Race Discrimination Under Section 1981 – The Lines Are Blurred

By Fiona W. Ong - Shawe Rosenthal LLP

August 29, 2018

A recent case brought something to my attention that I had not focused on before. As noted by the U.S. District Court for the District of New Jersey in Vodopivec v. Anthony’s LLC, Section 1981’s specific prohibition on “race discrimination” encompasses more than just the traditional notions of race – it also includes ancestry and ethnicity! But not national origin. What?!!!

To refresh your recollection, Congress passed Section 1981 as part of the Civil Rights Act of 1866, and it provides, in relevant part:

All persons within the jurisdiction of the United States shall have the same right in every State and Territory to make and enforce contracts, to sue, be parties, give evidence, and to the full and equal benefit of all laws and proceedings for the security of persons and property as is enjoyed by white citizens, and shall be subject to like punishment, pains, penalties, taxes, licenses, and exactions of every kind, and to no other.

Although “race” does not appear in the language of the statute, the Supreme Court has held that this section prohibits racial discrimination in the making of private and public contracts. The Supreme Court then went on to say that “race” is interpreted to include “ancestry or ethnic characteristics” but not “nation of … origin.” It further clarified that sub-groups are protected under the aegis of “race” – such as “Arabs, Englishmen, and Germans.” Other federal courts, including the Vodopivec court, have followed this lead in finding ancestry and ethnicity – but not national origin – to be covered by Section 1981.

Well, this is a little confusing to me. As you likely know, the Equal Employment Opportunity Commission, which enforces the other major federal race discrimination law – Title VII – requires employers with 100 or more employees (as well as certain other employers) to complete and submit the annual EEO-1 form, in which company employment data is summarized by “race/ethnicity, gender and job category.” As to “race/ethnicity,” employers must indicate the number of employees who are of the Hispanic or Latino ethnic group, and separately indicate the numbers of those who are White, Black or African-American, Native Hawaiian or Other Pacific Islander, Asian, American Indian or Alaska Native, or Two or More Races. That’s a pretty short and definitive list.

Of relevance to this issue, in its Compliance Manual, the EEOC then more broadly defines “race” as including “ethnic ancestry.” It also recognizes an overlap with national origin discrimination, but asserts that they are not the same. “For example, discrimination against a Chinese American might be targeted at her Asian ancestry and not her Chinese national origin. In that case, she would have a claim of discrimination based on race, not national origin.”

And then, the EEOC has also issued an Enforcement Guidance on National Origin Discrimination (yes, the same discrimination that the Supreme Court says is specifically NOT covered by Section 1981). In that Guidance, the EEOC states that national origin discrimination not only includes discrimination based on place of origin, but also ethnicity. In fact, it equates “national origin group with “ethnic group.”

So, as I understand it: Race = Ethnicity, and Ethnicity = National Origin, except that Race ≠ National Origin. (The math does not compute…)

But what does it matter? Well, attorneys who get the definition of “race” wrong for purposes of a Section 1981 claim could potentially face malpractice charges! After all, Section 1981 has a different statute of limitations and provides for different damages than Title VII. So, failing to bring a Section 1981 claim in conjunction with a Title VII claim could be a problem. And I am not speculating – courts have acknowledged this possibility!