In a recent unpublished decision, the Fourth Circuit ruled that merely being placed on a performance improvement plan (PIP) does not amount to actionable discrimination under Title VII.

Employers commonly use PIPs to provide an opportunity for an employee to correct and improve his or her deficiencies in performance. Many employees believe that PIPs amount to discriminatory or retaliatory targeting when they do not agree with their employer’s assessment of their performance.

In Jensen-Graf v. Chesapeake Employers’ Ins. Co., the employer placed Jensen on a PIP because of perceived performance deficiencies in a few areas. Jensen disagreed, felt that she had been targeted, and filed an EEOC charge, claiming that the company was using the PIP to discriminate against her based on her gender. She subsequently filed a retaliation charge when her employer did not allow her to participate in a professional development course. The district court granted summary judgment to the employer on the basis that neither action met the legal requirements for discrimination or retaliation claims.

The Fourth Circuit agreed, finding that Title VII claims require that an employer have taken an adverse action against the employee bringing the action. Adverse actions are generally discrete events that affect the terms and conditions of employment in a negative way. Courts have found that termination, demotion, salary reduction, denial of promotion, transfer, and loss of benefits constitute adverse employment actions. A PIP, while it may be a precursor to an adverse action, is itself not an action that results in a material change in the terms or conditions of employment.

While a PIP in and of itself is not an adverse action that can give rise to a Title VII claim, employers should not use PIPs as swords or to cover up unlawful discrimination. PIPs have a very useful purpose to rehabilitate employees with potential. If an employee can otherwise provide discriminatory animus and good performance, a PIP could be used as further evidence of intent to discriminate.