The U.S. Supreme Court ruled unanimously on June 3, 2019, in Fort Bend County, Texas v. Davis, that federal courts may hear plaintiffs' claims of discrimination brought under Title VII, even if those claims were not brought to the U.S. Equal Employment Opportunity Commission (EEOC) or state agency equivalent. Specifically, the Court held that the filing of a charge of discrimination with the EEOC or state fair employment practices agency is not a jurisdictional prerequisite to bringing a claim in federal court. Therefore, an employer who fails to timely seek dismissal for failure to exhaust administrative remedies waives the defense. The Court's decision is a stark reminder to employers that delay in asserting certain defenses may result in a waiver of those defenses.

The majority opinion, written by Justice Ruth Bader Ginsburg, notes that "Title VII's charge-filing instruction is not jurisdictional, a term generally reserved to describe the classes of cases a court may entertain (subject-matter jurisdiction) or the persons over whom a court may exercise adjudicatory authority (personal jurisdiction)." As such, federal courts are not required to dismiss Title VII claims where the plaintiff has not exhausted administrative remedies on the basis of lack of jurisdiction.

Notably, employers may still use lack of exhaustion of administrative remedies as a defense – although an employer who does not bring such a defense in a timely manner waives it. Justice Ginsburg noted: "Defendants, after all, have good reason to promptly raise an objection that may rid them of the lawsuit filed against them."

When faced with a Title VII claim that has not yet been exhausted before an agency, employers should be sure to quickly address the lack of exhausted administrative remedies in an answer or a dispositive motion. Otherwise, the employer risks waiving an important potential defense to a Title VII claim.