In a decision likely to have significant implications for hospitals and other educational programs that receive federal financial assistance, the Third Circuit Court of Appeals recently held that a Philadelphia hospital can be subject to liability under either Title VII of the Civil Rights Act of 1964 or Title IX of the Education Amendments of 1972, following a lawsuit by a former medical resident asserting claims of sexual harassment and retaliation.

In Doe v. Mercy Catholic Med. Ctr., 2017 U.S. App. LEXIS 4004 (3d Cir. Pa. Mar. 7, 2017), the Third Circuit concluded that the resident program run by Mercy Catholic Medical Center through its affiliation with Drexel University's College of Medicine, qualifies as an "education program or entity" as defined by Title IX by virtue of its receipt of federal dollars through Medicare funding. Title IX prohibits sex-based discrimination, including sexual violence, sexual harassment, and hostile environment based on sex. Education programs or activities receiving federal funds are required to comply with Title IX's mandates.

In Doe, a medical resident alleged that she was subjected to sexual advances by her superior and was subsequently dismissed from the hospital's residency program after complaining about the purported harassment. As the hospital was within the reach of Title IX, the medical resident brought suit in federal court, without adhering to the administrative procedures required under Title VII. The lower court held that the medical resident could not use Title IX as a means of circumventing Title VII's administrative exhaustion requirement, as Congress intended for Title VII to be the exclusive avenue of relief from employment discrimination. The Third Circuit rejected this reasoning, holding that where Title IX and Title VII are equally applicable, a plaintiff can select either to pursue redress. 

In reaching its conclusion that the plaintiff was not limited to Title VII in asserting her claims, the Third Circuit identified four guiding principles: (1) private-sector employees are not restricted to Title VII in seeking relief from workplace discrimination; (2) whether an alternate avenue of relief for workplace discrimination circumvents Title VII's mandatory administrative procedures is a matter of policy within the purview of Congress; (3) Title IX implies a private cause of action that applies to both students and employees; and (4) Title IX's private cause of action extends to employees of federally-funded education programs who allege retaliation claims on the basis of sex.

Finally, the Third Circuit's opinion adopts an expansive definition of "education." "The Supreme Court has twice instructed us, that to give Title IX the scope its origins dictate, we're to accord it a sweep as broad as is its language," the 36-page opinion states. "[T]here's no reason to read the phrase 'education program or activity' so narrowly." Instead, the Court noted that the focus should be on whether the program at issue is structured as an education program; whether program participants receive a degree, certification or other qualification for successful participation; whether there are teachers, grades, and a tuition associated with the program; and whether the program is promoted as educational. The Third Circuit found that Doe's allegations satisfied each of these criteria.

The Third Circuit's decision has major implications for hospitals and other educational programs and activities that receive federal financial assistance. The most significant take-away for affected employers is that participants in their educational programs and activities may now elect to go straight to court to litigate claims instead of engaging in the administrative process as required under Title VII. In light of Doe v. Mercy Catholic Med. Ctr., employers that receive federal financial assistance for educational programs or activities should be mindful of the following:

• Employees may be able to pursue employment discrimination claims under either Title VII or Title IX;
• Employers should evaluate whether they are subject to liability under Title IX; and
• Realize that if a discriminated-against employee pursues their claim under Title IX, they may proceed directly to federal court without having to go before an administrative agency as required under Title VII.