## Facts

- Santa Fe Trail Transportation Co. accused three employees—L. N. McDonald (white), Raymond Laird (white), and Charles Jackson (Black)—of misappropriating cargo.
- After an internal investigation, Santa Fe discharged McDonald and Laird but retained Jackson despite allegedly similar involvement.
- McDonald and Laird pursued contractual grievance procedures and filed EEOC charges; they obtained no relief.
- They sued in federal court alleging race-based disparate treatment in discharge under Title VII and 42 U.S.C. § 1981.
- They also alleged the Teamsters local union violated Title VII by acquiescing in the discriminatory treatment and by inadequately representing one petitioner during the grievance process.

## Issues

1. Whether Title VII’s ban on discharge because of an individual’s race protects white employees on the same terms as nonwhite employees.
2. Whether 42 U.S.C. § 1981 applies to claims of race discrimination against white persons in private employment.
3. Whether alleged participation in criminal misconduct bars a Title VII or § 1981 claim when the employer allegedly disciplined employees differently by race for the same incident.
4. Whether a labor union may be liable under Title VII for discriminatory grievance handling or for acquiescing in an employer’s racially disparate discipline.

## Decision

- The Supreme Court reversed the Fifth Circuit’s affirmance of dismissal and remanded for further proceedings.
- Title VII prohibits racial discrimination in private employment against white persons on the same standards as discrimination against nonwhite persons.
- Section 1981 is applicable to racial discrimination against white persons in private employment and is not limited to protecting only minorities.
- Misconduct may justify discharge, but it does not justify race-based disparities; if an employer retains a similarly culpable employee of another race, a disparate-treatment claim is stated.
- Title VII applies to labor organizations; a union may be liable if it discriminates by race in representation or grievance processing, or if it ratifies employer discrimination.

## Legal Principles

- Title VII’s prohibition on adverse action because of race protects “any individual,” including white employees, against race discrimination.
- 42 U.S.C. § 1981 extends to all persons and forbids race-based impairment of the right to make and enforce contracts, including claims brought by white employees.
- An employer may discharge for crime or misconduct, but the criterion must be applied equally across races; unequal enforcement can constitute disparate treatment.
- Labor unions are subject to Title VII and may be liable for race discrimination in representational activities, including grievance handling and acquiescence in employer discrimination.

## Conclusion

The Court held that Title VII and § 1981 prohibit race discrimination against white as well as nonwhite employees, and that alleged misconduct does not defeat a discrimination claim where discipline is allegedly imposed unevenly by race; it also recognized potential Title VII liability for unions that discriminate or acquiesce in discriminatory grievance representation.


McDonald v. Santa Fe Trail Transp. Co., 427 U.S. 273 (1976)