Lowering The Bar In Workplace Bias Cases

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This episode is part of my initiative to provide access to important court decisions  impacting employees in an easy to understand conversational format using AI.  The speakers in the episode are AI generated and frankly sound great to listen to.  Enjoy!

A single HR form can decide a lawsuit. We dig into Shear v. Sisters of Charity to show how a mandatory EAP referral and a required compliance-reporting form collided with the Supreme Court’s new “some harm” standard from Muldrow v. City of St. Louis—shifting what counts as an adverse employment action under the ADA and Title VII. The story tracks a familiar arc—productivity issues, a performance improvement plan (PIP), and a sudden turn when coworkers report safety concerns—then pivots to a tougher question: when does care become coercion?

We walk through the core facts with clarity: the performance improvement plan, the mandatory referral to an outside EAP provider, and the form that would send attendance and treatment compliance back to the employer as a condition of keeping the job. That form becomes the fault line. Under the old “significant change” rule, a court might see the referral as inconvenient but not legally adverse. After Muldro, the bar drops. Non-monetary harms like coerced disclosures and loss of autonomy now qualify if they leave an employee worse off in a tangible way. We also weigh the employer’s best defense—policy consistency across employees—and why uniform rules do not automatically defeat a “regarded as disabled” claim when the trigger is a perceived mental health condition.

You’ll hear practical guidance woven through the analysis. For employers: narrow data collection, separate safety from performance, document objective reasons, and avoid tying privacy waivers to job survival. For employees: understand how “some harm” broadens viable claims, especially around privacy and compelled consent. By the end, you’ll see how Muldro reshapes risk around EAP mandates, monitoring, lateral transfers, and other once “minor” actions—and why the Shear case will influence where courts draw the line between genuine concern and unlawful stereotyping. If this conversation helps you think differently about policy, privacy, and workplace fairness, subscribe, share the episode with a colleague, and leave a quick review to tell us what resonated most.

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Disclaimer: For educational use only, not intended to be legal advice.

Episode Transcript

SPEAKER_01 (00:00):
Welcome to the deep dive.
Today we're looking into a uhreally significant legal shift
affecting employment law.
It centers around a formerhealth system employee, Bethany
Shear, and her employer, Sistersof Charity of Leavenworth Health
System, or SCL.

SPEAKER_00 (00:16):
Exactly.
Our source material is the 202510th Circuit ruling, Shear v.
Sisters of Charity.
And this case is, well, it'sabsolutely crucial because it's
one of the first big onesapplying a brand new lower
standard set by the SupremeCourt for workplace
discrimination claims.

SPEAKER_01 (00:31):
So this isn't just academic theory.

SPEAKER_00 (00:33):
Aaron Powell Not at all.
This directly impacts howemployers have to handle
concerns about employeebehavior, uh, mental health
right now.

SPEAKER_01 (00:39):
Aaron Powell Okay.
So our mission today is tounpack Bethany Shearer's story,
her job at SEL, the mandatorymental health counseling
situation, and ultimately herfiring.
But maybe even more importantly,we need to get into the legal
shift itself, this Moldrodecision, which basically
revived her case when it seemeddead in the water.
Okay, let's unpack this.

SPEAKER_00 (00:57):
So Bethany Shear, she worked for SCL in their
physician billing department.
Her role was patient accountsrepresentative I, and she was
there from 2014 up until 2019.

SPEAKER_01 (01:06):
And for a lot of that time, the relationship
seems, well, a bit rocky.
Focused mainly on her jobperformance.

SPEAKER_00 (01:12):
That's right.
If you dig into SCL's records,there's a clear paper trail.
Uh Shear had seven differentcorrective actions noted between
2014 and 2018.

SPEAKER_01 (01:22):
Seven.
Wow.

SPEAKER_00 (01:23):
Yeah, and almost all of them were about not hitting
her monthly productivitytargets.
Her supervisors, uh stole, theysaw this pattern.
She'd have low output for mostof the month, then this kind of
last-minute scramble, lots ofstress, to try and meet the
goals.

SPEAKER_01 (01:39):
So by August 2019, they decided to act.

SPEAKER_00 (01:42):
They did.
Supervisors Oars Born and Stolldrafted a performance
improvement plan, a PIP.
Pretty standard stuff, really.
They intended it as a tool, youknow, not disciplinary, just to
help her get more consistent.

SPEAKER_01 (01:52):
Right, just address the productivity.

SPEAKER_00 (01:54):
That was the plan initially.
But then things changeddramatically around August 22nd
and 23rd of 2019.
The focus shifted sharply fromjust performance to a perceived
crisis.
Oh so Skear apparently sharedsome deeply personal issues with
several co-workers, and thosecoworkers reported feeling
seriously concerned about herwell-being, her safety even.

(02:15):
Okay.
One supervisor, Stowe, actuallyrelayed concerns to HR,
mentioning talks of suicide orpossibly suicidal ideations.

SPEAKER_01 (02:24):
Uh okay, that definitely shifts the dynamic.
Right.
So once HR gets involved, whathappens to that standard PIP?

SPEAKER_00 (02:32):
Aaron Powell Well, the HR director, Karen Oxenford,
got these reports, and the PIPwas immediately overhauled.
It wasn't just about billingquotas anymore.
Who do they add?
They added a very specificmandatory requirement.
She had to be referred to SCL'semployee assistance program, the
EAP.
This was handled by an outsidecompany, New Directions, and
crucially, this counselingwasn't just suggested.

(02:53):
It was made an explicitcondition of her keeping her
job.

SPEAKER_01 (02:56):
Wow, a condition of employment.

SPEAKER_00 (02:58):
Exactly.
And this is where it gets reallycomplicated.
Shear, initially, she saidsomething like she was not
opposed to seeing someone forhelp.
She seemed okay with the basicidea of the PIP, but the
mandatory EAP part required herto sign a specific document, a
formal referral form, the FMRform, and that form became the
major sticking point.

SPEAKER_01 (03:18):
Why?
What was on it?

SPEAKER_00 (03:20):
It wasn't just a simple privacy release, you see.
By signing it, Shear wouldauthorize the EAP provider, new
directions, to report twospecific things back to her
employer, SCL.

SPEAKER_01 (03:30):
Okay, what were they?

SPEAKER_00 (03:31):
First, simply whether she attended the
counseling sessions.
Second, and this is key, whethershe complied with whatever
recommendations the EAP made.

SPEAKER_01 (03:40):
Ah, so SEL would know if she was following the
therapist's advice.

SPEAKER_00 (03:44):
Essentially, yes, at least in terms of compliance.
And Shear refused point blank tosign it.
She argued it was overbroad, apotential ADA violation, and a
serious invasion of her privacy.

SPEAKER_01 (03:54):
Especially since she maintained she wasn't actually
mentally ill or a danger toherself.

SPEAKER_00 (03:58):
Precisely.
Her concern was that SCL wasbasically getting oversight, you
know, control over intimatedetails of her potential mental
health treatment simply as aterm of keeping her job.

SPEAKER_01 (04:08):
How did SCL react to her refusal?

SPEAKER_00 (04:10):
They didn't budge.
From their perspective, signingthat FMR form was a mandatory
part of complying with the PIP,it was non-negotiable.

SPEAKER_01 (04:18):
So and she kept refusing.
Okay, so that leads to thelawsuit.
What was her specific legalargument?

SPEAKER_00 (04:37):
This is really important.
She sued under the Americanswith Disabilities Act, the ADA,
specifically using the regardedas disabled pronged.

SPEAKER_01 (04:45):
Meaning she wasn't claiming she had an actual
disability.

SPEAKER_00 (04:48):
Correct.
Her argument was that SCLterminated her based on their
erroneous perception that shesuffers from a disability of
mental illness.
She argued they acted based on,quote, myths, fears, and ather
stereotypes, not on any actualinability to do her job or
concrete evidence of being adanger.
The firing, she claimed, stemmedfrom their perception, their

(05:09):
fear.

SPEAKER_01 (05:10):
What's fascinating here is how this played out
legally.
SEO actually won the firstround, didn't they?

SPEAKER_00 (05:14):
They did.
And it really highlights howquickly legal standards can
change.
When Shear's case first went tothe district court, the judge
applied the existing law in thatcircuit, the 10th circuit.

SPEAKER_01 (05:24):
And that law made it hard for her.

SPEAKER_00 (05:26):
Very hard.
The standard came from a 1998case, Sanchez.
To prove discrimination underthe ADA or Title VII, an
employee had to show theysuffered an adverse employment
action.
But Sanchez defined that actionreally narrowly.

SPEAKER_01 (05:41):
How narrow?
What was that old standard?

SPEAKER_00 (05:44):
It had to be a significant change in employment
status.
Think big things getting fired,being demoted, not getting a
promotion you were qualifiedfor, or maybe being reassigned
to a job with vastly different,usually worse responsibilities.
It was a high bar.

SPEAKER_01 (05:58):
Like a wall the plaintiff had to climb over,
basically.

SPEAKER_00 (06:00):
Exactly, a pretty high wall.
So the district court looked atthe mandatory EAP referral, even
with that controversial FMRform, and said, okay, maybe it's
invasive, maybe it'sinconvenient, but is it a
significant change in her jobstatus, like a firing or
demotion?

SPEAKER_01 (06:14):
And the answer was no.

SPEAKER_00 (06:16):
The answer was no.
At that point, the referralitself wasn't the firing, it was
just a condition leading to thefiring if she refused.
So under that old high standard,the court dismissed her case.
The wall was too high.

SPEAKER_01 (06:29):
But then everything changed.

SPEAKER_00 (06:30):
Everything changed.
In 2024, after the districtcourt dismissed Shear's case,
the U.S.
Supreme Court dropped abombshell ruling, Muldrove v.
City of St.
Louis.

SPEAKER_01 (06:40):
And Muldro wasn't even an ADA case, right?

SPEAKER_00 (06:43):
Correct.
It was actually a Title VII caseabout alleged sex discrimination
involving a job transfer.
But the impact was massivebecause the Supreme Court
explicitly rejected that wholesignificant change test.
They said that standard waswrong, not just for Title VII,
but implicitly for other federaldiscrimination laws that use
similar language, like the ADA.

SPEAKER_01 (07:03):
Wow.
So the Supreme Court just toredown that high wall for
potentially all federaldiscrimination claims race, sex,
religion, disability.
Trevor Burrus, Jr.

SPEAKER_00 (07:12):
That's the implication.
It lowered the burdensignificantly.
So if the old standard was thathigh wall, what's the new one?

SPEAKER_01 (07:17):
What is the new standard after Maltro?

SPEAKER_00 (07:19):
The new rule is much simpler, much slower.
Plaintiffs now only need to showthey suffered some harm
respecting an identifiable termor condition of employment.

SPEAKER_01 (07:29):
Some harm, not significant harm.

SPEAKER_00 (07:32):
Exactly.
The Supreme Court clarified theemployer's action must have left
the plaintiff worse off, butneed not have left her
significantly so.
It's no longer about proving amajor change.
It's just about showing you weredisadvantaged in some tangible
way related to your job.

SPEAKER_01 (07:48):
So because Muldro came out after Shears' case was
dismissed.

SPEAKER_00 (07:51):
The 10th Circuit Court of Appeals, in its 2025
decision reviewing Shears case,basically said, hold on, they
vacated the lower court'sdismissal of the case.

SPEAKER_01 (08:00):
Meaning they canceled the dismissal.

SPEAKER_00 (08:02):
Right.
They told the district court,the rule you use, the
significant change rule, that'snot the law anymore, thanks to
Muldro.
You need to look at this againusing only the new lower sum
harm standard.

SPEAKER_01 (08:12):
Here's where it gets really interesting.
Because the fight now isn'tabout whether the harm was big
enough.
It's about whether this kind ofharm, forcing someone to
potentially reveal sensitivehealth compliance info to keep
their job, counts as any harm atall.

SPEAKER_00 (08:28):
That's precisely the question the district court has
to grapple with now on remand.
What does some harm actuallylook like when it's not about
losing pay or a promotion, butabout things like medical
privacy and personal autonomy?

SPEAKER_01 (08:40):
And SCL still has arguments, right?
They didn't just roll over.

SPEAKER_00 (08:43):
Oh, absolutely not.
SCL has some strong points.
They emphasize Shear'sperformance history, the fact
the PIP was initially draftedbefore the suicidal ideation
reports came in.
They argue the EAP referralwasn't discriminatory
retaliation for anything.

SPEAKER_01 (08:57):
And didn't they use this EAP referral on someone
else too?

SPEAKER_00 (09:00):
Yes, that's a critical piece of their defense.
They showed evidence that theyhad issued an identical
mandatory EAP referral with thesame FMR form requirement to a
different employee.
And that other employee wasreferred for general disruptive
behavior with no mention ofsuicidal thoughts or mental
health issues.

SPEAKER_01 (09:17):
So SCL's argument is look, this is just our standard
procedure for certain behavioralor performance issues.
We applied it consistently, notbecause we regarded Shear as
disabled.

SPEAKER_00 (09:27):
Exactly.
That consistency argument isprobably their best defense
against the discriminationclaim.
Plus, they also point outsomething else Shear did after
she was fired.

SPEAKER_01 (09:36):
Okay.

SPEAKER_00 (09:37):
Apparently, after her employment ended, Shear
voluntarily went to five EAPsessions with the very same
provider, new directions.
Oh.
So SCL argues, see, she wasn'tactually harmed by the referral
itself.
She later chose to use theservice.
How can the earlier mandatedreferral be considered harm if
she ultimately found value init?

SPEAKER_01 (09:58):
Okay, wait though.
Let me push back on that,especially under the new some
harm standard.
Just because she later wentvoluntarily doesn't erase the
potential harm of being forcedto agree to that specific FMR
form as a condition of keepingher job.

SPEAKER_00 (10:11):
That's Sheer's counter-argument, precisely.
The harm wasn't necessarily thecounseling itself, it was the
coercion.
It was being forced, underthreat of firing, to sign away a
degree of control over herpersonal health information
specifically, the compliancereporting back to SCL.

SPEAKER_01 (10:25):
The mandatory nature and that specific form are key.

SPEAKER_00 (10:29):
They are.
Her argument is she wasn't justtold go get help.
She was told sign this form,allowing us oversight into your
EAP attendance and compliance,or you're fired.
That required disclosure, linkedto the employer's action, which
she claims was based on aperceived disability.
They're regarded as part that'sthe harm.

SPEAKER_01 (10:47):
And if SEL acted because they wrongly perceived
her as mentally unstable, actingon a stereotype, maybe then
demanding that invasivecompliance info as a job
condition.

SPEAKER_00 (10:56):
Yeah.

SPEAKER_01 (10:57):
That itself makes her worse off, doesn't it?
It's a loss of privacy andautonomy that other employees
didn't face.

SPEAKER_00 (11:03):
This raises an important question.
It highlights the core tensionnow.
Can an employer have a policy,apply it consistently like SEL
did with the other employee, butstill have it result in
discrimination if the reasonthey applied it to SHEAR was
based on a perceived disability,and that application caused this
unique non-monetary harm relatedto privacy.

SPEAKER_01 (11:24):
So the debate has shifted.
It's not, was the harmsignificant anymore?
It's just was there some harm,some disadvantage?
And being forced to sign thatwaiver under threat of firing
seems like a clear disadvantage.

SPEAKER_00 (11:35):
It certainly seems easier to argue under the new
standard.
And you have to remember, shewas suspended without pay and
then fired, specifically becauseshe refused to sign that form.

SPEAKER_01 (11:44):
Right.
The refusal was the directtrigger for the negative
consequences.

SPEAKER_00 (11:48):
Exactly.
The mandatory requirement wasthe term of employment she
wouldn't meet, the refusaltriggered the disciplinary
action, and termination was theultimate result.
Under the some harm test,connecting those dots is much
more straightforward for aplaintiff.
Which is why the case is backwith the district court, they
now have to decide if thatcompelled loss of privacy and
autonomy qualifies under thislower Moldra standard.

SPEAKER_01 (12:12):
So what does this all mean?
What's the big takeaway here?

SPEAKER_00 (12:14):
Well, the key takeaway for you listening is
pretty stark.
The Moldra decision meansemployers really need to be
hyper-aware now.
Actions that might have seemed aminor before, things like
mandatory EAP referrals, evenchanges in work schedules,
specific types of monitoring, orlateral transfers with different
duties.
These can all potentially beseen as adverse employment

(12:36):
actions if they leave anemployee objectively worse off
in some way.

SPEAKER_01 (12:40):
Even if it's not about money or title.

SPEAKER_00 (12:41):
Even if it's not about money or title.
The bar for employees to bringdiscrimination suits under the
ADA in Title VII has beenlowered quite dramatically,
actually.

SPEAKER_01 (12:50):
It feels like it really puts teeth into that
regarded as disabled prong ofthe ADA.

SPEAKER_00 (12:56):
It really does.
Think about it.
Shear's entire claim rests onSCL regarding her as having a
mental illness based on thosecoworker reports based on, as
she alleges, myths, fears, andstereotypes.
Right.
So if an employer acts out ofwhat they might see as genuine
concern, but that concern stemsfrom an unfounded perception or
stereotype about a disability,and that action forces the

(13:19):
employee into a situation thatcauses some harm, like signing a
coercive privacy-invading formto keep their job.
Well, the new Muldros standardmakes it significantly easier
for that employee to argue thatthe employer's helpful
intervention is, in fact, directevidence of discrimination based
on that perceived disability.

SPEAKER_01 (13:36):
That's a really fine line for employers to walk now.

SPEAKER_00 (13:38):
It is.
Future cases are definitelygoing to be exploring this
tension.
Where does genuine appropriateconcern end and a legal action
based on stereotyping begin?
Especially when the resultingharm isn't a demotion, but
something more like a loss ofautonomy or privacy.