Second Circuit: Notice of Termination is an Adverse Action Even if Rescinded

Last week, the U.S. Court of Appeals for the Second Circuit clarified its standard relating to rescinding terminations, and more specifically, how they interpret “adverse consequences.” The issue came before the court in a matter where an employee returned from her honeymoon, visibly pregnant, and was told that her position was going to be eliminated within a few weeks. Shortly thereafter, the employee retained an attorney and notified her employer of the same. Several days later, the employer rescinded her termination and reinstated her position. When analyzing rescinding termination claims under Title VII, the standard is to determine if the reinstatement had any lasting “adverse consequences.” Various circuit courts and lower courts have historically considered whether the employee was restored to the same salary, benefits, and title when reinstated in order to determine if there were adverse consequences to the employee. If the same material conditions were reinstated, courts would not recognize adverse consequences. Here, the employee did not claim any difference in salary, title, or benefits and therefore, the lower court ruled that the employee incurred no adverse consequences.