Dive Brief:
- A Black former portfolio manager for BNY failed to show that racial discrimination, rather than lack of qualifications and poor performance, led to his alleged demotion and termination, the 3rd U.S. Circuit Court of Appeals held Monday.
- BNY terminated the plaintiff in Lynn v. The Bank of New York Mellon in a reorganization process that aimed to reduce redundancy between roles, with the company viewing the plaintiff as the poorest performing of the termination candidates. He alleged that BNY placed him on a performance improvement plan and later fired him in retaliation for filing a discrimination charge with the U.S. Equal Employment Opportunity Commission. He also claimed that BNY replaced him with a White employee.
- A district court granted summary judgment for BNY on all claims,; and the 3rd Circuit affirmed. It held that BNY did not actually replace the plaintiff’s position, instead spreading his responsibilities to existing employees. The court also held that BNY offered a nondiscriminatory reason for the termination — the plaintiff’s performance — which the plaintiff failed to establish as pretext for discrimination.
Dive Insight:
In its decision, the 3rd Circuit noted that evidence offered by BNY cut against the plaintiff’s claims of discriminatory animus.
For instance, the White employee whom the plaintiff claimed to have replaced him following his termination had actually been an existing employee at the termination and performed only some of the plaintiff’s responsibilities after he had been let go. Moreover, replacement of a plaintiff by someone outside of their protected class is not necessary to raise an inference of discrimination, the court said.
The plaintiff had also been placed on a PIP less than three months following the filing of his EEOC charge and responded to this by emailing his supervisor: “I believe that I am continuing to be discriminated against on the basis of my race and retaliated against because of my race-discrimination complaints, including my filing of an EEOC Charge against BNYM.”
But the plaintiff offered only “weak and mischaracterized evidence” aside from the timing of the PIP to show that it was discriminatory, the court said. It noted that the plaintiff’s supervisor at the time demonstrated a desire to work with the plaintiff to improve his performance and based her decision to initiate the PIP based upon feedback from multiple employees about the plaintiff, including some who had never heard about his EEOC charge.
As a separate matter, the court also rejected the plaintiff’s argument that he had been demoted before to moving to the role at BNY that he held prior to his termination. The 3rd Circuit held that no rational jury could find that the company compelled him to leave his previous position to take the new one and that available evidence showed he had instead voluntarily left his prior role.
PIPs do not always constitute an adverse action under federal antidiscrimination laws, federal courts have said. For instance, the 1st Circuit held in March that architectural firm HNTB did not discriminate against an employee who claimed that her placement on a PIP was discriminatory on the basis of age. The 1st Circuit noted that the plan in question did not lead to reassignment or the loss of title or pay or any limitation on the plaintiff’s ability to seek other opportunities at the firm.
However, a 2025 decision of the 7th Circuit held that a PIP with “impossible” conditions could be viewed as discriminatory toward an employee who is fired as a result of not completing such a plan. In that case, the plaintiff’s PIP contained action items whose deadlines had passed before the plaintiff received the plan.
