The Civil Rights Act of 1991 prohibits discrimination in the making and enforcement of contracts. The Supreme Court ruled 5/27/08 that that law allows retaliation claims by employees who allege that discrimination led to their termination. Here, a restaurant manager claimed he was fired in retaliation for complaining about racially discriminatory treatment of another employee, but his employer claimed he was fired for leaving the restaurant safe open.
The Supreme Court held that although the Act does not specifically provide for race retaliation claims, employer conduct after the formation of a contract is subject to Section 1981 because Congress amended the law in 1991. Courts have interpreted Section 1982 to allow suits for retaliation, and Sections 1981 and 1982 have long been interpreted alike.
Employers will face a somewhat expanded scope of potential liability in discrimination cases, both from the ruling that retaliation is actionable and from the additional benefits that plaintiffs have under Sec. 1981 compared to Title VII of the Civil Rights Act, namely a longer statute of limitations, no requirement that EEOC administrative remedies be pursued, and no damages caps.