In a pair of important new decisions, the U.S. Supreme Court has for the first time clarified the rules about when you can be liable for harassment that you didn’t know about or that didn’t cause the victim a loss of job benefits. The rulings offer something for everyone. They make it easier for employees to sue you for harassment under federal law while also providing a roadmap of steps you can take to help insulate yourself from liability in certain cases. We’ll show you how to take full advantage of the new employer protections.
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Supervisor Makes Repeated Threats
The first case involved Kimberly Ellerth, a salesperson for Burlington Industries in Chicago. Ellerth claimed her supervisor, Ted Slovik, made comments about her breasts and told her to “loosen up,” warning her he could make her life at Burlington “very hard or very easy.” During an interview for a promotion, Slovik allegedly put his hand on Ellerth’s knee and told her he had reservations about promoting her because she was not “loose enough.” Ellerth said that on another occasion Slovik told her wearing short skirts would make her job “a whole heck of a lot easier.”
Despite Slovik’s alleged threats, Ellerth was promoted. But she eventually quit, claiming Slovik’s behavior made it impossible for her to continue working at Burlington. She then sued the company for sexual harassment.
Lifeguard Endures Ongoing Harassment
In the second case, a lifeguard employed by the city of Boca Raton, Fla., claimed two of her supervisors continually harassed her. The supervisors allegedly touched the employee, Beth Ann Faragher, and other female workers in inappropriate ways and made vulgar references to women and sex.
Faragher never complained to anyone in higher management about her supervisors’ behavior. She resigned and sued the city for sexual harassment.
Employers Claim No Harm, No Knowledge
In both cases, the employers asked to have the lawsuits thrown out of court. Burlington contended it couldn’t be liable for the alleged harassment because Ellerth suffered no job detriment in spite of her boss’s threats. And Boca Raton argued it shouldn’t be held responsible because it had no knowledge of the harassment since Faragher never complained.
Court Spells Out New Rules
The U.S. Supreme Court ruled in these two cases that under federal law you can be responsible for a supervisor’s harassment even if you didn’t know the harassment was occurring and even if the employee lost no tangible job benefit such as a promotion. But according to the court, you may be able to avoid liability by showing you took steps to prevent the misconduct. Here’s how the new rules work:
- Employee suffers job detriment. If an employee is denied a job benefit or fired because of a supervisor’s harassment, as an employer you are automatically liable. This is true even if you didn’t know about the harassment and even if you made efforts to prevent such behavior.
- Employee suffers no job detriment. If a supervisor makes threats but an employee suffers no job detriment, or if no threats are made but the harassment is severe and pervasive, you can still be held liable for the supervisor’s acts even if you didn’t know about the conduct. But there is some good news. The Supreme Court ruled you can defend yourself in these cases by showing: 1) you exercised reasonable care to prevent and remedy harassment, such as by distributing a strongly worded sexual harassment policy; and 2) the victim didn’t take advantage of the opportunities you provided to correct the harassment-for example by failing to report the harassment through an established complaint procedure.
Strong Policies More Important Than Ever
California courts currently hold employers automatically responsible for a supervisor’s harassment in all situations-regardless of whether you tried to prevent it or the victim experienced a job detriment. In the future, however, it’s possible that the Cali- fornia Supreme Court will adopt the U.S. Supreme Court’s more reasonable approach. (Note that under state and federal rules, you’re liable for co-worker harassment only if you knew about it and did nothing to stop it.)
Four Steps To Take Now
In the meantime, it is important to follow the advice suggested by these new cases. Having an effective sexual harassment policy and complaint procedure will increase the likelihood a harassment charge can be resolved quickly. Requiring an employee to complain before suing gives you a chance to stop the harassment-instead of being blindsided by a lawsuit over a problem you knew nothing about. And if you are sued, the fact that you had a policy and complaint procedure can greatly reduce the risk of punitive damages.
To fully protect yourself, be sure that you:
- Don’t let your harassment policy gather dust on a shelf. The policy needs to be regularly distributed and communicated. Have employees sign a form acknowledging they have received and read the policy. In ad-dition, periodically conduct training sessions for employees on your zero-tolerance policy.
- Make it easy to complain. Your policy needs to lay out a simple and reliable way for employees to report incidents of sexual or other harassment. Some employers have established special hotline numbers for employees to report problems. At a minimum, identify one or two experienced individuals responsible for investigating harassment charges, and make it clear employees can bypass a harassing supervisor when making a complaint.
- Conduct effective investigations. It’s critical to have effective procedures in place for promptly and thoroughly investigating complaints. To avoid being sued by the accused harasser, give the person a full opportunity to explain before you make a decision.
- Follow up. If you didn’t terminate the alleged perpetrator, continue to monitor the situation to make sure the harassment has stopped. And never do anything that could be considered retaliation against the victim, such as changing their work duties or reassigning them to a less desirable position.