Arbaugh v. Y & H Corp.
The Supreme Court ruled that a federal civil rights law's requirement that an employer have at least 15 workers is not a limit on which cases a federal court can hear at all, but rather a fact the worker must prove to win her case.
Because the employer waited until after losing a jury trial to raise the 15-employee issue, it was too late to raise it, and the woman's jury verdict and award are restored rather than thrown out on a technicality.
How it got here: A trial court vacated a jury verdict for the plaintiff after ruling the employee-count requirement was jurisdictional; the Fifth Circuit affirmed, and the Supreme Court agreed to resolve a circuit split.
The Case in Depth
What happened
Jenifer Arbaugh worked as a bartender and waitress at a New Orleans restaurant and said one of its owners sexually harassed her, forcing her to quit. She sued the restaurant's corporate owner under the federal law banning workplace sex discrimination, plus related state claims, and a jury awarded her $40,000 after a two-day trial.
The question before the Court
If a company waits until after a jury trial to argue it had too few employees to be sued under a civil rights law, can that argument still wipe out the verdict?
Why it matters
Employees who win discrimination verdicts will no longer see their victories erased years later because a company waited to argue it was too small to be sued. Businesses must raise employee-count disputes early, and courts nationwide gained a clear rule for telling when a statutory requirement is truly about a court's power to hear a case versus just an element a plaintiff must prove.
What changes now
The case goes back to the lower courts, with the original jury verdict and $40,000 judgment for Jenifer Arbaugh reinstated because the employer's too-small-to-sue argument came too late to challenge the merits of her claim. This is a final decision on the jurisdictional question, though further proceedings may occur on remand to formally restore the judgment and address the previously dismissed state-law claims.
What this does not decide
The Court did not decide whether the restaurant actually had 15 or more employees — that merits question is resolved by the reinstated jury verdict, not by this ruling. The decision also does not address every statute with an employee-count or similar threshold; it only announces the general test for telling jurisdictional limits apart from claim elements.
How the Court got there
The legal reasoning, step by step
- The Court framed the issue as distinguishing two often-confused ideas: a federal court's basic power to hear a type of case at all (subject-matter jurisdiction) versus a fact a plaintiff must prove to actually win (an element of the claim).
- The Court reasoned that treating a rule as jurisdictional carries serious consequences: jurisdictional defects can be raised at any time, even after a full trial, and courts must dismiss an entire case, including any related state-law claims, once jurisdiction is found lacking.
- Because those consequences are so disruptive, the Court adopted a clear-statement approach: a statutory limit counts as jurisdictional only if Congress clearly says so; otherwise courts should treat it as simply part of what a plaintiff must prove.
- Applying that approach, the Court found nothing in the civil rights law's text tying the 15-employee threshold to the courts' basic power to hear the case, unlike other laws where Congress did clearly write dollar-amount or party-status limits into the jurisdictional grant itself.
- The Court also noted that where such a threshold is genuinely contested, letting a jury decide it as part of the case, rather than a judge deciding it as a jurisdictional gatekeeping matter, respects the jury's traditional role as fact-finder on the merits.
- Because the 15-employee threshold is not jurisdictional, the employer's objection was really an argument about the merits of the claim, and rules governing merits arguments require them to be raised before the trial ends.
Doctrinal impact
Cases affected by this decision
Distinguishes Hishon v. King & Spalding (467 U. S. 69)
The Court says this earlier case never actually decided whether the 15-employee rule was jurisdictional.
Distinguishes EEOC v. Arabian American Oil Co. (499 U. S. 244)
The Court says its earlier use of the word 'jurisdictional' there was a passing label, not a real ruling on the question.
Reaffirms Steel Co. v. Citizens for Better Environment (523 U. S. 83)
The Court relies on this case's rule that unexamined 'jurisdictional' labels in past rulings carry no binding weight.