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Can a Plaintiff be Reinstated after Voluntary Resignation or Reduction in Force?


No doubt most people have heard about the gender discrimination case against the multinational finance company, Goldman Sachs, brought by five female employees who were denied promotion opportunities and retaliated against for their complaints. Two of the five employees were seeking reinstatement even though they were not subjected to discriminatory termination.

Claims of company-wide gender discrimination

There were five plaintiffs who filed claims of company-wide gender discrimination against all levels of female employees – associates, vice presidents and managing directors. The claims include denial of compensation and promotion opportunities. According to the plaintiffs, Goldman Sachs was a “boy’s club” that focused on drinking and sports and sexualized women, as well as retaliated against them for their complaints.

Goldman Sachs challenged claims for declaratory relief

During the litigation stage, Goldman Sachs filed a motion to dismiss the claims of two plaintiffs for injunctive and declaratory relief, including reinstatement to their former positions. This issue was important because one of the plaintiffs had voluntarily resigned and the other was separated from the company because her entire division was eliminated.

The two legal issues this motion raised were (1) whether these two former employees had standing to pursue injunctive and declaratory relief, as they were no longer employed; and (2) whether reinstatement was a proper form of relief in this particular situation.

Standing of a former employee to seek injunctive or declaratory relief

Ultimately, the court, in this case, determined these two former employees had standing to seek reinstatement, particularly. Although this ruling seemed to contradict an early decision that former employee lacks standing to bring claims against former employers for injunctive or declaratory relief. However, the court rationalized that the prior decision applied to a class action with claims for back pay and other individual monetary relief. The prior case did not apply to a request for reinstatement.

Are these former employees entitled to reinstatement?

The big question here is whether an employee can be reinstated when, either they voluntarily resigned or their department was eliminated. The court decided that an employee does not necessarily have to be fired to be entitled to reinstatement. In other words, a claim of unlawful termination is not required in order to be eligible for reinstatement. However, the next issue is whether reinstatement would be feasible in the given situation. To make that determination, the courts consider the circumstances of each case.

The feasibility of reinstatement when a position or department has been eliminated

Goldman Sachs argued that it was not feasible to offer reinstatement to an employee whose division no longer existed. However, the court disagreed, stating that reinstatement in a lateral position was a feasible option, especially in light of the fact that the employee had claimed that women were denied opportunities for lateral moves.

If you feel you have been the victim of discrimination or retaliation, or if you have any questions regarding your employment rights, please contact Michel | King , either online or by calling us at (205) 265-1880.

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