Understanding Section 1981 Race Discrimination Claims

Understanding Section 1981 Race Discrimination Claims in Federal Court

Race discrimination in contractual relationships—including employment—is prohibited under federal law. One of the most potent tools for combating this injustice is 42 U.S.C. § 1981 (“Section 1981”), which protects individuals from race-based interference in the making and enforcement of contracts.

This blog explores the legal foundation of Section 1981, how it works, and how courts—especially in Texas and the Fifth Circuit—have interpreted and applied it.

What is Section 1981?

Section 1981 of the Civil Rights Act of 1866, codified at 42 U.S.C. § 1981, states in relevant part:

“All persons within the jurisdiction of the United States shall have the same right… to make and enforce contracts… as is enjoyed by white citizens.”

The term “make and enforce contracts” includes:

This statute applies to both public and private actors and protects only against racial discrimination. See Saint Francis Coll. v. Al-Khazraji, 481 U.S. 604, 613 (1987) (holding that Section 1981 protects against discrimination based on ancestry or ethnic characteristics).

Key Elements of a Section 1981 Claim

To establish a claim under Section 1981, a plaintiff must show:

  1. They are a member of a racial minority;
  2. They were subject to intentional racial discrimination;
  3. The  discrimination concerned a contractual relationship or interest.

“To establish a claim under § 1981, a plaintiff must initially plead and ultimately prove that, but for race, [they] would not have suffered the loss of a legally protected right.”
— Comcast Corp. v. Nat’l Ass’n of African American-Owned Media, 140 S. Ct. 1009, 1019 (2020)

The Supreme Court’s decision in Comcast clarified that but-for causation is the standard of proof: race must be the determining factor in the adverse action.

Texas and Fifth Circuit Application of Section 1981

In the Fifth Circuit, which covers Texas, Louisiana, and Mississippi, courts follow the McDonnell Douglas burden-shifting framework for indirect evidence of discrimination:

  1. Prima facie case (plaintiff proves race-based differential treatment)
  2. Employer’s legitimate, nondiscriminatory reason
  3. Plaintiff shows pretext for discrimination

“To prevail under Section 1981, the plaintiff must prove that the defendant had a discriminatory purpose and that the discrimination was a ‘but-for’ cause of the adverse action.”
— Body by Cook, Inc. v. State Farm Mut. Auto. Ins. Co., 869 F.3d 381, 386 (5th Cir. 2017)

Texas Federal Court Example:

In Mitchell v. Crescent Directional Drilling, L.P., No. 4:13-CV-3077, 2015 WL 123642 (S.D. Tex. Jan. 7, 2015), an African American plaintiff alleged he was terminated due to his race. The court allowed his Section 1981 claim to proceed past summary judgment because the plaintiff presented evidence that white coworkers were treated more favorably under similar circumstances.

Differences Between Section 1981 and Title VII

 While both Section 1981 and Title VII of the Civil Rights Act of 1964 prohibit race discrimination, they differ in several important ways. Section 1981 applies exclusively to race-based discrimination, whereas Title VII covers a broader range of protected classes, including race, color, sex, religion, and national origin. Section 1981 protects both employees and independent contractors, while Title VII applies only to employees. Another key distinction is that Section 1981 does not require filing a charge with the Equal Employment Opportunity Commission (EEOC) before going to court, allowing plaintiffs to proceed directly with a lawsuit. In contrast, Title VII mandates an administrative process, including filing a charge and obtaining a right-to-sue letter. Additionally, damages under Section 1981 are not capped, meaning plaintiffs may recover full compensatory and punitive damages if proven, whereas Title VII imposes statutory caps on damages based on the size of the employer. Finally, most claims under Section 1981 are subject to a four-year statute of limitations, as established by the Supreme Court in Jones v. R.R. Donnelley & Sons Co., 541 U.S. 369 (2004), whereas Title VII claims are generally subject to much shorter deadlines, requiring administrative action within 180 or 300 days of the alleged discrimination and a lawsuit within 90 days of receiving a right-to-sue notice.  

Remedies Under Section 1981

Successful plaintiffs can recover:

In Johnson v. Chapel Hill Independent School District, No. 6:16-CV-1111, 2018 WL 3017363 (E.D. Tex. June 15, 2018), the court permitted Section 1981 claims for alleged racially discriminatory termination to proceed alongside Title VII claims, noting the availability of broader remedies.

Practical Considerations

  Final Thoughts

Section 1981 is a critical civil rights statute that offers robust protection against racial discrimination in employment and other contractual relationships. In Texas and throughout the Fifth Circuit, courts carefully scrutinize claims for intentional race discrimination, but they also uphold them when the evidence is compelling.

If you’ve been denied a job, contract, or promotion—or treated unfairly in the workplace—because of your race, you may have a valid Section 1981 claim. Consulting with an experienced civil rights or employment attorney can help you assess your rights and options for moving forward.