Reassigned … and Ready to Sue? Fourth Circuit Ruling May Open the Door to More Discrimination Claims by Employees

Quick Hits

• In Herkert v. Bisignano, No. 24-1420 (August 14, 2025), the Fourth Circuit found that, depending on the circumstances, a job reassignment may be an adverse employment action under the Supreme Court’s Muldrow standard.
• While finding that an employee’s acceptance of a new position does not necessarily mean that the change was voluntary, the Fourth Circuit declined to hold that any loss of supervisory authority would constitute “an actionable ‘disadvantageous change’ in employment status.”
• Employers may need to be prepared to explain and defend the legitimate reasons for a reassignment decision.

Background

An employee who served as a supervisory building manager for the Social Security Administration (SSA) suffered from multiple physical disabilities, including severe renal impairment, pulmonary impairment, and spondylosis. The employee’s request for scheduled telework as an accommodation for her medical needs was initially denied. She challenged the denial, and an SSA official eventually determined that the requested accommodation was reasonable and effective.

In the meantime, due to performance issues, the employee was reassigned to an analyst position at the same pay grade and level. The employee considered the new position, which lacked supervisory responsibilities, to be lower status, less interesting, and offering fewer opportunities for advancement. She was then offered a different nonsupervisory management analyst role at the same pay grade and level, which she still considered to be a demotion. She accepted that position, however, as the “least worst” option. She was also able to telework as requested.

The employee sued the SSA for a violation of her rights under the Rehabilitation Act (the federal-employee analogue to the Americans with Disabilities Act) claiming, among other things, that she had been subjected to discrimination in her reassignment from her building manager role to the nonsupervisory management analyst role. The federal district court, ruling prior to the Supreme Court’s 2024 decision in Muldrow, granted summary judgment in favor of the SSA and dismissed the employee’s claims, finding that the reassignment was not a sufficiently significant change in employment status to qualify as an adverse employment action, given that the employee retained the same pay grade and salary. The court also found that the employee had voluntarily accepted the reassignment.

The Fourth Circuit’s Decision

The Fourth Circuit vacated the district court’s judgment and remanded the case for further proceedings. The appeals court’s decision was governed by the Supreme Court’s ruling in Muldrow v. City of St. Louis, which clarified that employees need not show a “significant” change in working conditions to establish an adverse employment action under federal antidiscrimination laws. Instead, it is sufficient to show some disadvantageous change in an employment term or condition. Several key points may be drawn from the Fourth Circuit’s opinion:

• Job reassignments may constitute an adverse employment action. The court emphasized that under the Muldrow standard, the employee’s reassignment could be considered adverse even if it did not result in a “significant” change in her employment status. The loss of supervisory authority and duties, as well as the perceived demotion, were sufficient to potentially meet this standard.
• Acceptance is not necessarily the same as voluntariness. The Fourth Circuit has previously held that there is no adverse action where an employer grants a voluntary request for transfer. But here, it found that there were genuine factual disputes regarding whether the employee’s reassignment was voluntary. The employee argued that she accepted the new position only as the “least worst” alternative. This raised questions about the voluntariness of her reassignment that needed to be resolved by a jury.

Lessons for Employers

Under Muldrow, whether an employment action may be considered adverse will be fact-specific and dependent on the circumstances. The Fourth Circuit’s decision highlights that even seemingly lateral moves might be considered adverse if they result in disadvantageous changes to an employee’s working conditions. Employers may want to be aware of the possible negative implications of reassignments and be able to explain the legitimate business reasons for such actions. This case serves as a reminder that staying informed about recent rulings is important for employers navigating the constantly evolving parameters of employment law.

Ogletree Deakins’ Leaves of Absence/Reasonable Accommodation Practice Group and Workforce Analytics and Compliance Practice Group will continue to monitor developments and will provide updates on the Employment Law, Leaves of Absence, State Developments, and Workforce Analytics and Compliance blogs as additional information becomes available.

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