First Circuit Rules That The Existence Of A PIP Alone Is Not An Adverse Employment Action

The First Circuit Court of Appeals, which includes Massachusetts, Rhode Island, New Hampshire, Maine and Puerto Rico, issued an important ruling on March 13, 2026. In Walsh v. HNTB Corp., No. 24-1499, 2026 WL 710036, the Court rejected the plaintiff's argument that the mere issuance of a performance improvement plan (PIP) constituted an adverse employment action under the Age Discrimination in Employment Act (ADEA).

The Court affirmed summary judgment in favor of the employer after the plaintiff failed to present sufficient evidence to prove that she was subject to an adverse employment action, which is one of the essential elements of a prima facie discrimination claim.

According to the Court, "[a] PIP does not have the same effect in every employment situation." It pointed out that a PIP is not an adverse employment action when an employer uses it "to warn an employee about performance deficiencies or to assist an employee in developing a plan to achieve an opportunity for skill development." Conversely, a PIP may be considered an adverse employment action if it imposes new job duties, changes terms of employment, or deprives an employee of potential advancement opportunities. Whether a PIP falls within one of those two categories is a fact specific inquiry.

The PIP at issue identified areas of concern with the plaintiff's performance and listed ways to improve those concerns. The PIP did not assign the plaintiff new duties, did not impact her pay, benefits, or title, and did not limit her ability to seek other opportunities within the company. The PIP also stated that the company reserved the right to terminate the plaintiff before the end of the period provided for her to improve her performance. Based on all of these factors, the Court concluded that the PIP did not change the terms of the plaintiff's employment, but rather appeared to be nothing more than a documented counseling.

Notwithstanding this decision, employers should take care in issuing PIPs. It is important to frame PIPs as tools for addressing performance deficiencies or to achieve areas of development rather than as punishment or as indicating that a termination decision or other adverse action has already been decided upon. Employers should also create and retain detailed records of showing any performance concerns leading to the PIP as well as any continuing concerns. Finally, employers should use PIPs in a consistent manner with all employees regardless of any employee's protected status.

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