Texas Supreme Court Clarifies: Managers Can Be Personally Sued for Workplace Misconduct
By: Zachery A. Grigg, JD, MPA – Attorney, ScottHulse PC
A recent federal case, Butler v. Collins (5th Cir. 2025), has major implications for Texas workplaces. The court confirmed that while the Texas Commission on Human Rights Act (TCHRA) is the exclusive remedy for discrimination and retaliation claims against employers, it does not shield individual employees from personal liability. In plain terms, a manager or coworker can still be sued for things like defamation or fraud, even if the same facts also form the basis of a discrimination claim against the employer.
THE CASE IN BRIEF
Cheryl Butler, a law professor at Southern Methodist University (SMU), was denied tenure. She sued SMU and several administrators, alleging discrimination and retaliation, as well as defamation and fraud against specific individuals.
The trial court dismissed her personal tort claims against specific the individuals, ruling that the TCHRA preempted them. But the Fifth Circuit asked the Texas Supreme Court to weigh in. The state’s highest court responded clearly:
- The TCHRA only governs employer liability.
- It does not give immunity to individual employees.
- Employees remain personally responsible for wrongful acts such as fraud or defamation, even when connected to workplace disputes.
The Fifth Circuit then reinstated Butler’s tort claims against the individual administrators while affirming dismissal of her other claims against SMU.
WHY THIS MATTERS
This ruling has ripple effects across Texas workplaces:
- FOR EMPLOYEES
- You’re not limited to filing a discrimination claim against your employer.
- If a supervisor lies about you or damages your reputation, you may sue that individual directly.
- FOR EMPLOYERS
- The TCHRA still protects the company by making it the exclusive remedy for discrimination and retaliation claims.
- But employers may face more complicated lawsuits if managers are named personally for non-statutory claims, increasing the pressure to settle disputes.
- FOR MANAGERS AND SUPERVISORS
- can be personally dragged into court if your actions cross into defamation, fraud, or other misconduct.
- The company’s legal shield does not protect them from their own behavior.
BEST PRACTICES GOING FORWARD
- Invest in training: Teach managers that workplace misconduct—like gossip, exaggerating performance issues, or misstatements—can have legal consequences.
- Promote professionalism: Respectful communication and transparency are not only good culture—they’re legal safeguards.
- Strengthen HR policies: Ensure reporting and documentation systems are clear and consistent to reduce exposure.
- Address issues early: Resolving conflicts quickly lowers the risk of lawsuits spiraling into personal liability.
THE BOTTOM LINE
Butler v. Collins confirms a critical distinction in Texas law:
- Employers are covered by the TCHRA’s exclusive remedy for discrimination and retaliation.
- Managers and coworkers are not immune and may be sued personally for torts like fraud and defamation.
For organizations, the lesson is clear. Protecting the company also means protecting your managers. Training, policies, and accountability are the best defenses, both for the employer’s bottom line and for the individuals who lead its teams.
How We Can Help: At ScottHulse PC, our experienced Labor and Employment team is closely monitoring these developments and is ready to help you navigate the complexities of the new litigation landscape. Whether you need assistance updating your policies, training employees, or understanding the legal implications of the lawsuit, we offer comprehensive guidance tailored to your business needs. Don’t wait until it’s too late. Contact us today to ensure your business is prepared for the potential impact of these significant changes.
Disclaimer: This information is provided for general informational purposes only and should not be construed as legal advice. Consult with an attorney for specific guidance on how the new overtime rules may affect your business. This material is provided for informational purposes only. It is not intended to constitute legal advice, nor does it create a client-lawyer relationship between ScottHulse and any recipient. Recipients should consult with counsel before taking any actions based on the information contained within this material.