Category Archives: Sexual Harassment

January 8, 2018

Confidential Sexual Harassment Settlements No Longer Tax Deductible

Steven Gutierrez

By Steve Gutierrez

The recently enacted tax reform bill contains a short provision that could significantly affect whether and how employers settle sexual harassment claims. Section 13307 of the Tax Cuts and Jobs Act states that no deduction is allowed for any settlement or payment related to sexual harassment or sexual abuse if the settlement or payment is subject to a nondisclosure agreement. The new provision also prohibits a tax deduction for attorney’s fees related to confidential sexual harassment settlements or payments.

Deductibility Hinges On Confidentiality of Settlement

The new tax provision eliminates a tax deduction for sexual harassment-related settlements only if the settlement or payment is subject to a nondisclosure agreement. In other words, if an employer requires the alleged victim of sexual harassment or abuse to keep the settlement (and presumably the underlying claim) confidential, then the amount of the payment and any attendant attorney’s fees are not tax deductible. Sexual harassment/abuse settlements and related attorney’s fees remain tax deductible if they are not subject to a nondisclosure agreement.

The policy behind this provision appears to be in response to the recent spate of sexual harassment and abuse claims coming to light. The “#MeToo” campaign has raised significant concerns about companies and their high-level employees hiding behind nondisclosure agreements to avoid public scrutiny about unlawful sexual conduct in the workplace. Repeat offenders often keep their jobs when their employers pay off the victims in secret. By eliminating the tax deduction for confidential settlements and related attorney’s fees, companies will be forced to weigh confidentiality against tax deductibility when deciding whether to settle each claim.

What If Sexual Harassment/Abuse Is Only One of Multiple Claims Being Settled?

One of the questions left unanswered in this new tax reform provision is what happens to the tax deduction for payments that settle more than one kind of employment claim. In many cases, the victim of sexual harassment or sexual abuse brings other claims against his or her employer, such as retaliation, gender discrimination, violation of the Equal Pay Act, or defamation. The language of the provision is unclear as to what is meant by any settlement or payment related to sexual harassment or sexual abuse. One could argue that a retaliation claim that arose from an adverse action following a complaint of sexual misconduct would be related to the sexual harassment claim. But what about an Equal Pay Act claim? Is that related to sexual harassment or sexual abuse?

It is unclear whether confidential settlement payments related to these other types of employment claims will remain tax deductible when lumped in with a sexual harassment settlement. This open question will likely lead employers to separate settlement agreements and payments for non-sexual harassment claims in order to keep the settlement of these other types of claims confidential and tax deductible. It also could lead employers (on likely advice from their attorneys) to structure settlements of multiple claims with an allocation of only a small amount, say $100, to the settlement of the sexual harassment claim, with the remainder of any settlement payment attributed to other types of claims alleged by the victim. Absent any clarification on this issue, we expect this will be the subject of much litigation down the road. In the meantime, companies and their attorneys likely will use creative drafting of settlements to try to separate unrelated claims in order to keep the settlement of non-sexual-harassment claims confidential and retain the deductibility of payments and attorney’s fees incurred for non-harassment matters.

Deductibility of Victim’s Attorney’s Fees

Another open question is whether the denial of deductibility applies only to the companies making settlement payments and their own attorney’s fees related to such settlements, or if it applies to the attorney’s fees incurred by the victim as well. The new provision denying deductibility for settlements subject to nondisclosure agreements amends section 162 of the Internal Revenue Code (IRC) which is the section that allows deductions for ordinary and necessary trade or business expenses paid or incurred during the course of a taxable year. Generally, an individual would not be able to take a business deduction under IRC Section 162. However, the language in the new provision does not make it clear that it applies only to the business’s own attorney’s fees, thus leaving open an interpretation that it also prohibits the victim of sexual harassment or sexual abuse from deducting his or her attorney’s fees related to settlements of such claims. It also could be interpreted to deny the deduction to a business that pays the victim’s attorney’s fees as part of a confidential settlement.

This could hit victims hard as those who sign nondisclosure agreements may have to pay taxes on the entire settlement, including any amounts paid to cover his or her attorney’s fees. Or, it could lead victims to reject any settlement containing a nondisclosure provision in order to avoid paying taxes on the attorney’s fee portion of the settlement payment.  It also may make employers less likely to agree to pay the victim’s attorney’s fees as part of a confidential settlement because the total amount of fees paid to attorneys on both sides would not be deductible as a business expense. It is unclear whether Congress meant to hamstring victims in this way, or if it was the result of inarticulate drafting. We will have to see whether a correction or guidance is issued to clarify how the new denial of deductibility provision affects a victim’s ability to deduct attorney’s fees.

Get Advice Before Settling

The denial of deductibility provision affects any amounts paid or incurred after December 22, 2017 (when the tax reform act became effective). This makes one thing about this new tax deduction provision clear – employers should get advice from competent counsel and tax professionals before settling any sexual harassment or sexual abuse claims. Employers will need to evaluate each case individually to decide whether confidentiality trumps deductibility. Then, after the employer decides whether to impose a nondisclosure requirement on the alleged victim of sexual harassment/abuse, the settlement agreement must be drafted carefully in light of this new provision. If the victim asserts multiple claims, employers may be able to keep the settlement of non-harassment claims both confidential and deductible, if the settlement agreement is drafted correctly.

The bottom line is seek advice early and don’t use boilerplate settlement agreements without considering the tax deductibility consequences of nondisclosure provisions.

January 2, 2018

Sexual Harassment – Employers Should Act Now

By Mark Wiletsky

Roger Ailes, Bill O’Reilly, Harvey Weinstein, Kevin Spacey, Charlie Rose, Matt Lauer, politicians from both sides of the aisle – the list of prominent individuals accused of sexual harassment and assault continues to grow. And as sexual harassment dominates the headlines, workers are coming forward in increasing numbers to describe inappropriate sexual conduct in the workplace.

This heightened awareness by both the public and employees should make every employer pause to consider if it is doing enough to keep employees safe and free from harassment. Here are our recommendations for steps you should take right now to help prevent your organization from appearing in the headlines.

Have a Strong Anti-Harassment Policy

Every employer should have a written policy that prohibits sexual harassment in the workplace. If you do not have one, you should strongly consider implementing one to ensure your employees know that sexual harassment is absolutely prohibited. If you already have one, review it to ensure that it includes the following provisions:

  • zero tolerance for unlawful harassment and inappropriate sexual conduct in the workplace
  • examples of unacceptable physical conduct, such as unwelcome touching, hugging, kissing, groping, and gestures, as well as inappropriate verbal or visual conduct, such as sexual jokes, emails, cartoons, pictures, and propositions
  • requests for sexual favors or demands to engage in intimate relationships will not tolerated
  • policy applies to inappropriate conduct by managers, co-workers, vendors, customers, and others who come into contact with your employees
  • every employee is expected to report any harassment that he or she experiences or witnesses
  • reporting mechanism that offers two or more reporting channels (such as a supervisor and the human resources manager)
  • commitment to take complaints seriously through timely and thorough investigation
  • no retaliation or adverse consequences will occur to those who report sexual harassment or cooperate in any investigation or proceeding
  • employees found to have engaged in sexual harassment or other inappropriate conduct will be subject to discipline, up to and including termination.

Train Both Managers and Employees

A policy does little good if your employees are not aware of it. Take this opportunity to conduct sexual harassment training for your entire workforce. Live in-person presentations may be the best way to train your employees, allowing you to take questions and emphasize your organization’s commitment to preventing and resolving any harassment issues. If live training sessions are impossible, offer video or recorded training. Provide specialized training to your executives, managers, and supervisors so that you can stress their input in creating a culture that is free of harassment, and to help them recognize and learn how to handle harassment scenarios.

Encourage Reporting of Inappropriate Conduct 

Employees won’t report harassment to you if they feel their complaint will fall on deaf ears.
They may, instead, talk to the media or an attorney. Consequently, management and human resources professionals need to encourage reporting of workplace improprieties, no matter who it involves or how sensitive the accusation. If you do not welcome complaints, you will not have an opportunity to nip inappropriate conduct in the bud or resolve situations that could prove highly detrimental to your company. 

Investigate Every Complaint

You must treat every report of sexual misconduct or harassment seriously and conduct a timely, thorough investigation to determine whether the alleged conduct occurred. If the complaint is against your company president or another high-ranking individual, you still must investigate it in the same vigorous manner you would for any other employee accused of the misconduct. Consider whether you need to hire outside counsel or a third-party investigator to preserve privilege and to avoid allegations that the investigator was biased because he or she reports to the person accused of misconduct. Take time now to make sure you have an investigation process in place so that when a report of harassment comes in, you don’t waste time determining who does what. 

Take Prompt, Appropriate Action

As you receive a sexual harassment complaint and begin an investigation, you need to determine what action, if any, should be taken pending the investigation’s outcome. You may need to place the alleged harasser on leave, or you may need to separate workers so that they work on separate shifts or in different locations. Your duty is to stop any harassment from occurring, so take whatever steps may be necessary to do that. Then, when you have sufficient facts about the alleged harassment, determine what action is warranted to resolve it. If you conclude that harassment likely occurred, you need to impose consequences. Depending on the severity, that could mean immediate termination of employment. Remember, zero tolerance means no unlawful harassment goes unpunished.

Preventing and Resolving Sexual Harassment Should Help Keep You Out of the News

Because the topic of sexual harassment is so hot right now, take the time to recommit your organization to preventing and resolving workplace harassment by following the steps above. Your efforts now will go a long way in avoiding surprise allegations in the future.

May 31, 2017

Sexual Harassment Claim May Proceed Despite Lack Of Specificity In EEOC Charge

By Brad Cave

The Tenth Circuit recently reversed the dismissal of a quid pro quo sexual harassment claim and sent it back to the trial court for a trial, rejecting the employer’s argument that the required, pre-lawsuit EEOC charge did not allege quid pro quo harassment.

Labeling Between Two Forms of Harassment Not Required

Most human resource professionals recognize that two forms of sexual harassment are prohibited under Title VII’s ban on sex discrimination. Quid pro quo harassment arises when a supervisor demands sexual favors from a subordinate in exchange for the receipt or withholding of a term or condition of employment. Hostile work environment harassment occurs when sufficiently severe or pervasive offensive conduct creates an intimidating, hostile, or abusive work environment. This distinction has been recognized for decades by the courts as two variations of prohibited sexual harassment.

Despite the widespread acceptance of these two recognized forms of unlawful harassment, neither Title VII nor its regulations use the “quid pro quo” or “hostile work environment” labels. As the Tenth Circuit Court of Appeals (whose decisions apply to Wyoming, Colorado, Utah, Kansas, New Mexico, and Oklahoma) recently pointed out, these labels began in academia and then were adopted by the courts. But, according to the Court, despite the ability of the labels to describe the alternate ways that sexual harassment may occur, the labels themselves are not wholly distinct claims. They both raise a claim of sex discrimination in the workplace in violation of Title VII.

Because a claim of sex discrimination encompasses both types of sexual harassment, the majority of the Tenth Circuit three-judge panel concluded that a former employee’s EEOC charge need only allege sufficient facts to alert his former employer of the alleged violation without having to specifically label which form of harassment is being alleged. Jones v. Needham, No. 16-6156 (10th Cir., May 12, 2017).

Male Mechanic Alleged Female Supervisor Made Sexual Advances

The case at issue arose when Bryan “Shane” Jones alleged that he was fired because he refused to have sex with his direct supervisor, Julie Needham. Jones worked as a mechanic for Needham Trucking, of which Ms. Needham was also a shareholder.

To file his claim with the EEOC, Jones completed an intake questionnaire on which he checked the boxes for “Sex” and “Retaliation” as the basis for his charge. He also wrote in sex harassment on the form. Moreover, he identified two witnesses that he claimed would testify that they knew of the sexual harassment and provided that another mechanic was treated better because he had sex with Ms. Needham. He also prepared an attachment to provide more details of his claim, including the statement that “I was terminated because I refused to agree to Ms. Needham’s sexual advances and I rejected all such efforts by her.”

EEOC Issued Right-to-Sue Letter After Preparing An Abbreviated Charge

Unbeknownst to Jones, the EEOC apparently did not receive the separate attachment to his intake questionnaire. Instead, the EEOC prepared a charge form based on the intake questionnaire alone. That charge form stated that during his employment, Jones was subjected to sexual remarks by owner, Julie Needham, that he complained about the sexual harassment to the general manager and other owners and nothing was done, and that Needham terminated his employment. The charge did not specify the additional information that Jones had written in his would-be attachment about Needham’s sexual advances.

After the EEOC issued Jones a right-to-sue letter, he filed a lawsuit in federal court alleging sexual harassment and other state-law claims. Although his complaint initially pursued his sexual harassment claim on both a hostile work environment and quid pro quo basis, he later dropped his argument based on a hostile work environment.

District Court Dismissed Quid Pro Quo Claim For Failure To Exhaust Administrative Remedies

Looking at whether Jones’ EEOC charge form sufficiently alleged sexual harassment, the district court appeared to find it deficient because the form did not include the missing attachment that spelled out the quid pro quo allegations. Relying on precedent that a plaintiff’s claim in federal court “is generally limited by the scope of the administrative investigation that can reasonably be expected to follow the charge of discrimination submitted to the EEOC,” the district court dismissed Jones’s sexual harassment claim, holding that Jones had failed to exhaust his administrative remedies for his quid pro quo sexual harassment claim.

Jones appealed to the Tenth Circuit, which revived his claim upon finding that the charge form contained sufficient allegations to trigger an investigation that would look into “what [Needham’s] sexual remarks were, why Mr. Jones was fired, and whether the two events were connected.” As described above, the Tenth Circuit refused to require that the charge be more specific as to the type or form of harassment alleged.

Lesson: Investigate All Possible Harassment Without Regard For Labels

Although Jones’s employer, Needham Trucking, argued that the facts alleged in the EEOC charge failed to provide it with notice that Jones was alleging quid pro quo harassment, the Tenth Circuit didn’t buy that argument. Instead, it expected the employer to investigate and respond to the facts that were in the charge regardless of whether they supported a hostile work environment or quid pro quo claim. Consequently, employers should investigate all facts in an EEOC charge and let their investigations follow where the facts take them.

Failure to exhaust administrative remedies is a very viable and useful defense when an employee’s lawsuit alleges claims outside of the allegations found in the EEOC charge. But when it comes to sexual harassment, don’t get too caught up in any labels regarding the theory of harassment being alleged. If the facts allege a claim under either (or both) forms of harassment, the charge may very well be sufficient.

June 15, 2016

OFCCP’s New Sex Discrimination Rule Expands Employee Protections Based on Pregnancy, Caregiver Status, and Gender Identity

Biggs_JBy Jude Biggs

This week, the OFCCP updated its sex discrimination guidelines on topics such as accommodations for pregnant workers, gender identity bias, pay discrimination, and family caregiving discrimination. Intended to align the OFCCP’s regulations with the current interpretation of Title VII’s prohibitions against sex discrimination, the new rule will require federal contractors to examine their employment practices, even those that are facially neutral, to make sure that they do not negatively affect their employees. The new rule takes effect on August 15, 2016.

Overview of New Sex Discrimination Rule

The existing OFCCP sex discrimination guidelines date back to the 1970s. The new rule is designed to meet the realities of today’s workplaces and workforces. Today, many more women work outside the home, and many have the financial responsibility for themselves and their families. Many women have children while employed and plan to continue work after giving birth to their children. Women sometimes are also the chief caregivers in their families. The updated regulations are meant to offer women and men fair access to jobs and fair treatment while employed.

The new rule defines sex discrimination to include discrimination on the basis of sex, pregnancy (which includes childbirth or related medical conditions), gender identity, transgender status and sex stereotyping. The rule specifies that contractors must provide accommodations for pregnancy and related conditions on the same terms as are provided to other employees who are similarly able or unable to perform their job duties. For example, contractors must provide extra bathroom breaks and light-duty assignments to an employee who needs such an accommodation due to pregnancy where the contractor provides similar accommodations to other workers with disabilities or occupational injuries.

The new rule also incorporates President Obama’s July 2014 Executive Order that prohibits federal contractors from discriminating on the basis of sexual orientation and gender identity. In addition, contractors that provide health care benefits must make that coverage available for transition-related services and must not otherwise discriminate in health benefits on the basis of gender identity or transgender status.

The rule prohibits pay discrimination based on sex. It recognizes the determination of “similarly situated” employees is case-specific and depends on a number of factors, such as tasks performed, skills, effort, levels of responsibility, working conditions, job difficulty, minimum qualifications, and other objective factors. Notably, the OFCCP rule says that employees can be “similarly situated” where they are comparable on some of the factors, but not all of them.

Unlawful compensation discrimination can result not only from unequal pay for equal work, but also from other employer decisions. Contractors may not grant or deny opportunities for overtime work, training, apprenticeships, better pay, or higher-paying positions or opportunities that may lead to higher-paying positions because of a worker’s sex. Employees may recover lost wages for discriminatory pay any time a contractor pays compensation that violates the rule, even if the decision to discriminate was made long before that payment.  Read more >>

January 19, 2016

An Uncomfortable, But Not Hostile, Work Environment

Cave_BBy Brad Cave

Certain workplace behavior may be unusual, uncomfortable or downright weird, but may not be unlawful. Do you want to take the chance of knowing what crosses that line?

Imagine receiving this complaint from an employee: “My supervisor frequently compliments my appearance, clothing and cologne. He touched my back and buttocks, claiming he was showing me where he was experiencing back pain. He instructed me to participate in two body-fat contests requiring me to wear a speedo where he again complimented my appearance and tried to touch my buttocks. He repeatedly asked me to join him for drinks during a company event.”

Do these allegations suggest a hostile work environment? Would your company be liable for sex discrimination?

Real Case Offers Guidance

These facts arose in an actual lawsuit filed by Bryan McElroy, a former district sales manager for American Family Insurance (AFI). McElroy was fired by his supervisor, Tony Grilz, after failing to meet sales goals and engaging in insubordinate behavior. After his termination, McElroy filed a charge with the Equal Employment Opportunity Commission (EEOC) and later filed suit in federal court, alleging, among other things, that he was subjected to a hostile work environment based on the above-recited behavior by Grilz.

Uncomfortable Work Behavior

The federal court acknowledged that “some of Grilz’s conduct could make many people uncomfortable.” But the district judge ruled that the conduct did not rise to the level of being so objectively offensive that it created a hostile or abusive work environment. The district court rejected McElroy’s hostile work environment claim and granted summary judgment to AFI.

On appeal to the Tenth Circuit Court of Appeals (whose decisions apply to employers in Colorado, Wyoming, Utah, Kansas, and New Mexico), McElroy argued that if the conduct could make many people uncomfortable, a jury could find it sufficiently offensive to support his hostile work environment claim. The Tenth Circuit disagreed. It failed to see how behavior that was capable of causing “mere discomfort” would necessarily alter the conditions of employment so as to create a hostile work environment.

The court stated that to succeed on a hostile work environment claim, an employee must establish that the workplace is permeated with discriminatory intimidation, ridicule, and insult, that is sufficiently severe or pervasive to alter the conditions of the victim’s employment and create an abusive working environment. The court reiterated that “even incidents that would objectively give rise to bruised or wounded feelings will not on that account satisfy the severe or pervasive standard” necessary for an actionable claim under Title VII. The court affirmed the grant of summary judgment in favor of AFI and against McElroy on his hostile work environment claim. McElroy v. Am. Family Ins., No. 14-4134 (10th Cir. Oct. 30, 2015).

Handling Questionable Complaints

What would you do if you received a complaint based on conduct such as what McElroy reported? Act on it? Ignore it? Here are some tips for handling complaints that may, or may not, rise to the level of severe or pervasive conduct.

Tip #1: Treat Each Complaint Seriously

It may be tempting to dismiss complaints of workplace harassment that may seem minor or inoffensive to you. Don’t do it. You never know if the complainant is telling you the full story or if other, more serious allegations are waiting to be told. In addition, failing to look into a report of workplace harassment will negate certain defenses if the complainant decides to file a lawsuit.

Tip #2: Conduct an Investigation

All reports of workplace harassment should be investigated. Hopefully, your investigation will show that no additional inappropriate behavior is occurring and that the reported conduct was an isolated, non-severe incident. You may, however, find that the conduct is more widespread. Perhaps other employees reporting to the same supervisor have experienced similar conduct, or the conduct has been escalating to involve more physical contact. You need to dig deeper to get the full picture of what the employee and his/her co-workers may be experiencing.

Tip #3: Take Action To Stop Inappropriate Behavior

Whether the behavior rises to the level of creating a hostile work environment or not, take action to stop it. Talk to the person acting inappropriately and explain that conduct such as touching and making comments about other employees’ looks leads to an uncomfortable work environment and must cease. Follow up with the complainant to make sure that he or she is not experiencing further inappropriate behavior or retaliation. Nip such conduct in the bud so that mere uncomfortable behavior does not escalate to unlawful harassment.  

Tip #4: Train Supervisors and Employees Annually

Conduct annual training on sexual harassment and other inappropriate workplace behavior in order to educate your workforce on your harassment policies and complaint-reporting mechanisms. Use training sessions to reinforce your commitment to keeping your company free of discrimination and retaliation. Make sure managers and supervisors are trained on recognizing and responding to complaints of workplace harassment.

Conclusion

Unlawful workplace harassment is tricky to define with any certainty. Conduct that one judge or appellate court finds as causing “mere discomfort” may be deemed sufficiently severe or pervasive so as to create a hostile work environment by another judge or court. Your best practice is to keep inappropriate behavior out of your workplace, follow the tips above and stay out of court in the first place.

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September 15, 2015

Wyoming Discrimination Charges: A Look at the Numbers

Cave_BBy Brad Cave 

Mark Twain is credited with saying that “facts are stubborn things, but statistics are more pliable.” The Wyoming Labor Standards Division and the EEOC both keep statistics of the types of discrimination charges the agencies receive from Wyoming employees. When it comes to discrimination charges, the allegations are almost always pliable, but the statistics show us some interesting things for employers to ponder.

Wyoming Labor Standards Charges 

The Wyoming Fair Employment Practices Act makes it unlawful for employers to discriminate on the basis of age, sex, race, creed, color, national origin, ancestry, pregnancy or disability. The Wyoming Department of Workforce Services’ Labor Standards Division is the state agency that processes and investigates most complaints of employment discrimination filed by Wyoming workers. 

In 2014, the Wyoming Labor Standards Division received a total of 203 discrimination charges. It processed 182 of those charges and deferred the remaining 21 charges to the federal Equal Employment Opportunity Commission (EEOC) because they were either untimely under state law or contained allegations of Equal Pay Act violations. The Division reports the breakdown of 2014 charges by allegation as follows: 

Type

No. of Charges

Percentage of Total Charges

Retaliation

76

41.8%

Sex

55

31.2%

Disability

46

25.3%

Age

33

18.1%

National Origin

27

14.8%

Race

21

11.5%

Religion

  7

  3.8%

You math wizzes in the audience have already exclaimed that the percentages exceed 100%, and the author must be numerically challenged. But, many charges include allegations of multiple types of discrimination. Indeed, charges often include an allegation of discrimination on the basis of protected class, and an allegation of retaliation in response to complaints about the discrimination. As you can see, Wyoming had more retaliation charges than any other type of charge. That mirrors the nationwide statistics where retaliation charges lead the list of most-filed charges. Not far behind are sex discrimination charges, with disability charges as the third most-frequently filed. 

EEOC Charge Statistics for Wyoming Charges 

The EEOC also maintains charge statistics for each type of discrimination that is alleged under the federal discrimination laws that it enforces, and annually publishes those statistics on a state-by-state basis.The EEOC count includes charges under Title VII, which prohibits discrimination on the basis of sex, race, color, religion and national origin, as well as charges under other federal discrimination laws such as the Americans with Disabilities Act, the Age Discrimination in Employment Act, and the Genetic Information Nondiscrimination Act. 

The EEOC’s most recent data for fiscal year 2014 (Oct. 1, 2013 through Sept. 30, 2014) shows that the federal discrimination charges for Wyoming received by that agency track the Labor Standards Division’s statistics, with retaliation charges leading the list. With a total of 69 discrimination charges filed with the EEOC by Wyoming workers in FY2014, here are the numbers by type:

Type

No. of Charges

Percentage of Total Charges

Retaliation

30

43.5%

Sex

29

42%

Disability

25

36.2%

Age

20

29%

Race

14

20.3%

National Origin

  6

  8.7%

Color

  4

  5.8%

Equal Pay Act

  3

  4.3%

Religion

  2

  2.9%

Wyoming employers received significantly more sex discrimination charges in 2014 than compared to 2013. The percentage of sex discrimination charges filed with the EEOC went up from 29.2% in FY 2013 to 42% in FY2014. Retaliation charges topped the list in both FY2013 and FY2014. The full list of EEOC charge receipts for Wyoming for the last five years may be viewed on the EEOC’s website at  http://www1.eeoc.gov/eeoc/statistics/enforcement/charges_by_state.cfm#centercol

Lessons Learned 

The charge statistics from the Wyoming Labor Standards Office and the EEOC reflect discrimination complaints filed by applicants and employees, not cases in which discrimination was determined to exist. Even so, the charge numbers for Wyoming suggest a number of action items for employers who want to avoid being included in next year’s statistics. 

First, retaliation gets a lot less attention from employers than it should, as these numbers show.  Whenever an employee complains about something at work that implicates a statutory right, like the right to be free from discrimination or harassment, or requests an accommodation or FMLA leave, the employee has engaged in protected activity. Most discrimination laws prohibit adverse actions because an employee has engaged in protected activity. And, it makes little difference whether the employee’s underlying complaint or request was valid – the employee is still protected against retaliation. 

Employers need a strong, stand-alone anti-retaliation policy, not just a couple of sentences at the end of the policy prohibiting discrimination. Employers also need to train supervisors and managers about the significance of employee complaints, and how the law protects employees. And careful consideration should be given to any adverse employment action for an employee who has opposed discrimination in the workplace, been interviewed as part of an investigation, or participated in a discrimination proceeding. 

Second, the prevalence of sex discrimination charges, which includes harassment charges, suggests that employers should review and update their discrimination and harassment policies, and continue periodic harassment prevention training. A strong harassment prevention policy, with understandable definitions and examples and multiple reporting options, is usually the best defense against a charge of sexual harassment. Of course, any observed or reported harassment must be investigated and any behavior which violates your policies must be stopped. 

Finally, adopt a policy that guides employees who wish to request an accommodation, and train supervisors how to recognize employee requests that could be interpreted as a request for accommodation. Once a request is made, follow a thorough interactive process to explore reasonable accommodations that do not place an undue burden on your organization but will allow the person to perform their job. Only when you are absolutely sure that no reasonable accommodation is available should you terminate a disabled employee. 

These action items will go a long way toward keeping you from becoming a statistic!

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March 13, 2014

Harassment Training for Supervisors is Key in Minimizing Risk

By Mark Wiletsky 

Most employers today have policies prohibiting harassment.  But if your supervisors and employees are not trained on those policies, and if harassment is allowed to occur, your organization could face significant liability.  

Female Bailiff Alleges Egregious Sexual Harassment By Her Supervisor 

Camille Kramer was employed as a jailor and later as a bailiff by the Wasatch County Sheriff’s Department.  While working at the jail, male co-workers allegedly made offensive comments about Kramer’s breasts, she was subjected to sexually explicit materials on work computers and had to listen to graphic sexual conversations.  Kramer complained to Sheriff Kenneth Van Wagoner, the head of the Sheriff’s Department.  Sheriff Van Wagoner said he’d “take care of it” and proceeded to call a staff meeting at which he used Kramer as a volunteer to act out the exact harassing scenarios that she had reported to him.  Van Wagoner told the group: “[t]hat’s harassment. Don’t do it.”  When the harassment got worse after the meeting, Kramer complained again to the Sheriff, who told her she might want to avoid that area. 

Kramer transferred to the courthouse to work as a bailiff.  Sergeant Rick Benson, also a bailiff, supervised both Kramer and one other bailiff. According to Kramer, Benson subjected Kramer to a campaign of sexual harassment and sexual assault that ranged from demanding foot rubs to groping and rape.  Kramer did not report Benson’s conduct to the Sheriff because Benson threatened her job if she said anything and she believed nothing would be done about it anyway. 

Later, Kramer told female co-workers about the rape and assault. She also told them that she was having a consensual affair with another man and was pregnant from that relationship.  Sheriff Van Wagoner found out about Benson’s sexual assault of Kramer and her pregnancy from one of Kramer’s co-workers.  He assigned a detective who was not trained in human resources or in conducting sexual harassment investigations to look into the misconduct.  The detective focused his investigation exclusively on finding out who fathered Kramer’s baby, not on Benson’s conduct.  When it was learned that Kramer was involved with a married county firefighter, the detective urged Kramer to resign and Kramer was disciplined with her certification suspended for six months for “actions unbecoming an officer.”  Although the Sheriff decided to terminate Benson, Benson resigned before that could happen.  

Benson directly supervised Kramer’s work as a bailiff.  He wrote her performance evaluations, which could cause her to be promoted, demoted or fired.  He could create a corrective action plan for her which might include transfer, reassignment or separation, if he deemed her performance was substandard. At all times, however, the Sheriff was the final decision-maker and the only person who had the actual authority to take tangible employment actions against Kramer. 

Kramer sued the County and the Sheriff for sexual harassment in violation of Title VII, among other claims.  The district court granted summary judgment to the County, holding that because Benson did not have the actual authority to unilaterally fire Kramer, the County could not be vicariously liable for Benson’s conduct.  It also ruled that supervisor status could not be based on Benson having apparent authority over Kramer because no reasonable juror could find that Kramer reasonably believed that Benson had the power to fire her.  On appeal, the Tenth Circuit Court of Appeals reversed the grant of summary judgment in favor of the County and remanded the case to the trial court for further proceedings. Kramer v. Wasatch Cty. Sheriff's Office, No. 12-4058 (10th Cir. Feb. 25, 2014).

Delegation of Power and Apparent Authority 

The Tenth Circuit pointed to wording in the Supreme Court’s recent case, Vance v. Ball State, 570 U.S. ___ (2013), to determine whether the County could be vicariously liable for Benson’s conduct.   Vance held that a “supervisor” for purposes of determining employer liability for workplace harassment under Title VII includes only those individuals who have the authority to take tangible employment actions against the victim.  Although that seemed like a bright-line test, the Tenth Circuit stated that if Benson had or appeared to have the power to take or substantially influence tangible employment actions or used the threat of taking such actions to subject Kramer to a hostile work environment, then the County could be vicariously liable for Benson’s severe or pervasive sexual harassment.  Because the Court found sufficient evidence in the record that raised genuine issues of fact as to whether the Sheriff effectively delegated to Benson the power to cause tangible employment actions by relying on Benson’s recommendations and performance evaluations when making decisions regarding firing, promotion, demotion and reassignment, the Court reversed the grant of summary judgment to the County.  The Court stated that even if the Sheriff took some independent analysis when considering input from Benson on employment decisions, Benson could qualify as a supervisor if his recommendations were among the proximate causes of the Sheriff’s decision-making.  The Court also found that there was evidence to suggest that Kramer reasonably believed that Benson had the power to take tangible employment actions against her meaning Benson qualified as a supervisor under apparent authority principles.  

No Tangible Employment Actions 

If Benson is a supervisor under the definition established in Vance, the County would be strictly liable for Benson’s harassment if it resulted in a tangible employment action.  Kramer asserted that four actions constituted tangible employment actions.  First, she argued that Benson’s rape was a tangible employment action.  The Court disagreed, stating that while the rape was inarguably a severe form of sexual harassment, Benson did not commit the rape in an official company action.  Next, Kramer asserted that Benson prepared a negative performance evaluation of her and argued that was a tangible employment action.  However, Benson improved the evaluation after speaking with Kramer and before submitting it to the Sheriff, so even though the threatened poor evaluation contributed to a hostile work environment, it did not constitute a tangible employment action.  The Court similarly rejected the final two alleged employment actions, a denial of leave time and assigning Kramer to an unfavorable duty that denied her the training needed for a promotion.  The Court found that the loss of one day’s leave time was not a “significant” change in Kramer’s benefits and the assignment to an unfavorable duty did not have a deleterious economic consequence for Kramer or reduce her opportunity for advancement.  Finding that Kramer did not suffer a tangible employment action, the Court remanded for consideration of whether the County established the Faragher/Ellerth defense. 

Teachable Moments from the Tenth Circuit 

The Court’s thorough discussion of Benson’s conduct and what the Sheriff did/did not do when he learned of potential misconduct reveals many teachable moments for employers.  First and foremost, make sure to train your supervisors and employees on prohibited forms of harassment, and how important it is to promptly and appropriately address issues when they arise.  For example, when an employee reports harassing behavior, as Kramer did when she first worked at the jail, take it seriously.  Do not simply tell workers to “stop it” or tell the person who complained to “avoid the area” or stay away from the perpetrators.  Make sure that the person conducting the investigation is trained in workplace harassment investigations.  Do not focus the investigation solely on the potential wrongdoing of the complaining party, as the detective did when trying to determine the father of Kramer’s baby.  Talk to all parties implicated in the misconduct, including any witnesses who may have knowledge of the hostile work environment.  If the investigation reveals harassing behavior, take immediate steps to correct it and prevent it from happening again.  Follow up with the person who reported it to make certain your corrective actions are effective and that no further incidents have occurred. And finally, do not retaliate against the complaining employee.  Learning from these missteps will go along way in minimizing your risk of harassment liability.

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August 12, 2013

EEOC Slapped with Order to Pay $4.6 Million for Pursuing Unreasonable and Groundless Discrimination Claims

By Mark Wiletsky 

240px-US-EEOC-Seal_svgWhen a former employee sues for discrimination or retaliation, the employer generally is unable to recover its fees or costs for defending the lawsuit, even if the employer prevails.  That was not the case, however, in a recent class action brought by the agency tasked with enforcing federal anti-discrimination laws, the Equal Employment Opportunity Commission (EEOC).  A federal court recently slammed the EEOC with over $4.6 million in attorneys’ fees, costs and out-of-pocket expenses after finding that the EEOC’s pattern or practice class action claim and 153 of the individual discrimination claims were unreasonable or groundless.  EEOC v. CRST Van Expedited, Inc., No. 07cv95 (N.D. Iowa, August 1, 2013).

 EEOC Sued Employer Alleging Sexual Harassment 

In September 2007, the EEOC filed a lawsuit against trucking company, CRST Van Expedited, Inc. (CRST) alleging that the company’s lead drivers and team drivers subjected female employees to sexual harassment and created a sexually hostile environment in violation of Title VII.  The EEOC filed its action on behalf of employee Monika Starke and a class of similarly situated female employees.   

After almost a year of discovery in the case, the EEOC was pressed to identify the total number of harmed individuals making up the purported class.  In October 2008, the EEOC identified 270 allegedly aggrieved female employees.  When the EEOC failed to make all of the individuals available for deposition by a court-ordered deadline, the District Court barred the EEOC from pursuing claims on behalf of those 99 individuals who were not deposed.

CRST filed multiple motions for summary judgment to get the remaining claims dismissed before trial.  First, CRST succeeded in getting the EEOC’s pattern or practice claim dismissed, which meant that the EEOC was left to pursue harassment claims only on behalf of individual employees. CRST then hammered away at all of the individual claims and succeeded in getting them all dismissed for a multitude of reasons, ranging from lack of evidence that some individuals had suffered severe or pervasive harassment to some individuals not reporting any harassment to the company.  Significantly, the Court dismissed 67 of the individual claims because the EEOC had failed to exhaust administrative prerequisites by failing to investigate or attempt conciliation of the claims.  Having dismissed all claims against CRST, the District Court found that CRST was the prevailing party and was entitled to recover its attorneys’ fees and costs, which exceeded $4.5 million.

EEOC Appeals and Keeps Two Claims Alive 

The EEOC appealed the dismissal of 107 of the claims to the Eighth Circuit Court of Appeals.  The Eighth Circuit reversed the dismissal of the claims on behalf of two female employees and consequently found that CRST was no longer the prevailing party entitled to recover its attorneys’ fees and costs.  The case was sent back to the District Court for continuation of those two claims. 

District Court Awards Millions in Attorneys’ Fees, Costs and Expenses 

After the case was sent back to the District Court, the EEOC voluntarily dismissed one of the two remaining claims because it had failed to exhaust the administrative prerequisites as to her claim.  CRST agreed to settle the remaining claim for $50,000 and the parties asked the Court to dismiss the case in its entirety as a result of the settlement.  CRST then asked to recover its attorneys’ fees, costs and expenses for the claims on which it prevailed. 

In order to recover its attorneys’ fees, costs and expenses, CRST needed to show that it was the prevailing party for purposes of Title VII and that the EEOC’s claims were frivolous, unreasonable, or without foundation.  The Court ruled that CRST was the prevailing party on the EEOC’s pattern or practice claim and on 153 of the EEOC’s individual claims.  CRST was not the prevailing party, however, for the claim it settled, for the three claims withdrawn by the EEOC and for 98 claims that the Court dismissed as a discovery sanction against the EEOC.  The Court then ruled that the EEOC’s failure to exhaust Title VII administrative prerequisites of investigation and conciliation for 67 of the individual claims was unreasonable.  It further ruled that the EEOC’s pattern or practice claim was unreasonable as it was based only on anecdotal evidence.  In total, the Court found that 153 of the individual claims as well as the pattern or practice claim were unreasonable or groundless.   

After discounting the total amount of CRST’s attorneys’ fees, costs and out-of-pocket expenses to reflect those claims for which CRST was not the prevailing party, the Court ordered the EEOC to pay CRST $4,694,442.  This award represented $4,189,296 in CRST’s attorneys’ fees, $91,758 in costs and $413,387 in out-of-pocket expenses for expert witness fees, travel expenses, delivery fees, and similar expenses. 

While the EEOC performs an important function and pursues meritorious cases, the case against CRST shows that employers can and should fight back when the EEOC brings a frivolous case.  Significantly, this is not the first time a court has awarded fees against the EEOC or rejected its claims.  Last year, the Tenth Circuit (which covers Colorado) slapped the EEOC with attorneys’ fees and costs in EEOC v. TriCore Reference Laboratories, No. 11-CV-2096 (10th Cir. 2012), affirmed summary judgment against the EEOC in EEOC v. The Picture People, Inc., No. 11-CV-1306 (10th Cir. 2012), and the court affirmed a district court’s decision that the EEOC’s administrative subpoena was overbroad in EEOC v. Burlington Northern Santa Fe Railroad.  We also recently discussed a letter sent by nine state Attorney Generals, in which they criticized the EEOC’s lawsuits and position concerning employers’ ability to use background checks to screen employees with a criminal record.  Hopefully, these losses, fee awards, and criticisms will cause the EEOC to more thoroughly evaluate which cases have merit before subjecting employers to the high cost and aggravation of defending meritless claims.


Disclaimer: This article is designed to provide general information on pertinent legal topics. The statements made are provided for educational purposes only. They do not constitute legal advice and are not intended to create an attorney-client relationship between you and Holland & Hart LLP. If you have specific questions as to the application of the law to your activities, you should seek the advice of your legal counsel.


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June 26, 2013

Employers Benefit From Supreme Court Ruling On Title VII Retaliation Claims

By Jude Biggs 

In a favorable ruling for employers, on June 24 the U.S. Supreme Court held that a retaliation claim under Title VII of the Civil Rights Act of 1964 requires an employee to show the employer’s desire to retaliate was the “but-for” cause of the challenged employment action.  University of Texas Southwestern Medical Center v. Nassar, No. 12-484 (U.S. June 24, 2013).  This establishes a different causation standard for retaliation claims than is required for underlying Title VII discrimination claims, which only require an employee to show the motive to discriminate was one of the employer’s motives in making an adverse decision.  Although cumbersome to have two standards, the decision is good news for employers, as often a jury will not find any discrimination by an employer, but may find retaliation after an employee speaks up about alleged discrimination.  Making it more difficult to prevail on a retaliation claim will, hopefully, encourage plaintiffs to bring fewer cases or resolve them earlier than going through an expensive trial.  

Employee Must Prove Employer Would Not Have Taken Action But For an Improper Motive 

In a 5-4 decision, the Supreme Court ruled a plaintiff making a retaliation claim under Title VII must establish that the employer would not have taken the alleged adverse employment action but for the plaintiff having engaged in protected activity.  Protected activity that may trigger a retaliation claim includes the employee opposing, complaining of or participating in a proceeding about unlawful discrimination in the workplace.  Through this ruling, the Court instructs that retaliation claims should fail if an employer had other reasons or motivations – singly or together — that caused the employer to take the adverse action (even if one other factor was retaliatory in nature).   In less legal terms, the employer wins if it can show its non-retaliatory reasons caused it to make the decision, even if a small portion of the decision was based on retaliation against the employee for engaging in protected conduct. 

Justice Kennedy, writing for the majority which included Justices Roberts, Scalia, Thomas and Alito, stated that the text of Title VII’s anti-retaliation provision appears in a different section of the law from the provision that prohibits discrimination based on race, color, religion, sex or national origin.  When Congress inserted the less rigorous “motivating factor” standard for discrimination cases in 1991, it could have inserted that standard into the anti-retaliation provision.  In choosing to omit it, Congress deliberately concluded that retaliation claims are to be treated differently and retaliation is unlawful only when the employer takes adverse action against an employee “because” of their protected activity.  The Court pointed to its interpretation of the Age Discrimination in Employment Act of 1967 in Gross v. FBL Financial Services, Inc. to require “but for” causation for retaliation claims. 

The Court also stated that this causation standard is essential to the fair and responsible allocation of judicial resources.  Recognizing that retaliation claims have been on the rise, the Court recognized that lessening the causation standard could contribute to the filing of frivolous claims, diverting resources from employers, agencies and courts in other efforts to fight workplace harassment. 

Dissent Urges Congressional Action 

Justices Ginsburg, Breyer, Sotomayor and Kagan dissented, alleging that fear of retaliation is the leading reason why employees do not speak up about discrimination in the workplace.  Because Title VII plaintiffs often have been subjected to both discrimination and retaliation, they now will have to litigate their claims under two standards:  (1) discrimination under the “motivating factor” test which requires a plaintiff to show only that a prohibited characteristic was a motivating factor in the employer’s adverse action, even if other factors also motivated the action; and (2) retaliation under the “but for” standard which requires a plaintiff to show that the employer would not have taken the adverse action but for a retaliatory motive.  The dissent concluded that this decision is at odds with a line of previous decisions that recognize retaliation claims are inextricably bound up with an underlying discrimination claim.  Justice Ginsburg, writing the dissenting opinion, stated “the Court appears driven by a zeal to reduce the number of retaliation claims filed against employers.” Calling the majority decision “misguided,” the dissent urges Congress to enact another Civil Rights Restoration Act to counter and remedy the injustice done by the majority opinion. 

Employers May Face Fewer Retaliation Claims or At Least, Fewer Successful Claims 

In practice, it is questionable how relevant the causation standard may be to potential litigants of retaliation claims.  Employees believing they have been wronged after they complain about discrimination will likely still file retaliation claims, no matter what causation standard applies.   Juries often will conclude retaliation occurred based on a general “fairness” standard.  However, employers may be able to resolve such claims at the summary judgment stage (when a court decides a claim does not merit a trial), because proof of other factors that contributed to the adverse employment decision will defeat the retaliation claim. 


Disclaimer:This article is designed to provide general information on pertinent legal topics. The statements made are provided for educational purposes only. They do not constitute legal advice and are not intended to create an attorney-client relationship between you and Holland & Hart LLP. If you have specific questions as to the application of the law to your activities, you should seek the advice of your legal counsel.


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June 25, 2013

Supreme Court Limits Definition of Supervisor for Employer Liability in Workplace Harassment Claims

By Emily Hobbs-Wright 

In a huge win for employers, the U.S. Supreme Court today decided that for purposes of determining employer liability for Title VII harassment cases, a “supervisor” is limited to those who are empowered by the employer to take tangible employment actions against the victim.  Vance v. Ball State Univ., No. 11-556 (U.S. June 24, 2013).  This means that employees who oversee the daily activities of other employees, but do not have the power to discipline, fire, promote, transfer or take other actions against an employee, are not considered “supervisors” in workplace harassment cases under Title VII.   

In drawing a sharp line between co-workers and supervisors, the Supreme Court adopted a clear standard that parties and reviewing courts can apply early in a case in order to determine which side has the burden of proof in Title VII harassment litigation.

Supervisor vs. Co-Worker as Harasser – Why It Matters 

Determining employer liability for harassment under Title VII of the Civil Rights Act of 1964 depends on whether the alleged harasser is a “supervisor” or a “co-worker” of the individual being harassed.  If the harasser is a co-worker, the employer will be liable for the harassing behavior only if the complainant can show that the employer was negligent, meaning that the employer knew or should have known of the conduct and failed to take immediate and appropriate corrective action.  See 29 CFR § 1604.11(d).   

If the harasser is a supervisor, however, the test for employer liability changes dramatically.  If the harassing supervisor caused a tangible employment action such as firing, demoting or reducing the complainant’s pay, the employer will be automatically liable for the harassment.  If there was no tangible employment action, the employer may still be liable, unless it can meet a two-pronged affirmative defense known as the Faragher/Ellerth defense.  

In order to establish the Faragher/Ellerth defense, outlined by the Supreme Court in the companion cases of Faragher v. City of Boca Raton, 524 U.S. 775 (1998) and Burlington Industries, Inc. v. Ellerth, 24 U.S. 742 (1998), an employer must show: (1) that the employer exercised reasonable care to prevent and promptly correct the harassing behavior; and (2) the plaintiff-employee unreasonably failed to take advantage of preventative or corrective measures established by the employer or to avoid harm otherwise.   

The key difference between cases alleging harassment by a co-worker and a supervisor is the burden of proof.  With co-worker harassment, the plaintiff-employee bears the burden of demonstrating employer negligence.  When trying to avoid liability for supervisor harassment, however, the employer bears the burden of establishing the Faragher/Ellerth affirmative defense.  The higher hurdle that must be met by employers when litigating supervisor harassment raises the opportunity for the plaintiff-employee to recover damages for harassment in the workplace.  Consequently, an important issue in a harassment case is whether the alleged harasser is a supervisor or a co-worker.   

Supreme Court Resolves Split in the Circuits on Definition of “Supervisor”

Lower courts have disagreed on the test for deciding whether an alleged harasser is a “supervisor” or merely a co-worker.  Some federal appellate courts, including the First, Seventh and Eighth Circuits, have ruled that an employee is not a supervisor under Title VII unless he or she has the power to hire, fire, demote, promote, transfer, or discipline the victim.  Other circuits, including the Second and Fourth Circuits, have followed the more expanded approach urged by the Equal Employment Opportunity Commission (EEOC), which applies “supervisor” status to those who have the ability to exercise significant direction over another employee’s daily work activities.   

In a 5-4 decision, the Supreme Court resolved this split in authority by holding that an employer may be vicariously liable for an employee’s unlawful harassment only when the employer has empowered that employee to take tangible employment actions against the victim, that is, to effect a significant change in employment status, such as hiring, firing, failing to promote, reassignment with significantly different responsibilities, or a decision causing a significant change in benefits.  Calling the EEOC’s definition of supervisor “nebulous,” the Court stated that it was not sufficient to deem an employee a “supervisor” based on his or her ability to direct another employee’s tasks.  The Court noted that the EEOC Guidance that looks at the number (and perhaps the importance) of the tasks in question would be a “standard of remarkable ambiguity.”  Relying on the Faragher and Ellerth decisions, the Court stated that a supervisor is instead empowered by the company as a distinct class of agent that may make economic decisions affecting other employees under his or her control. 

Bright Line Between Co-Workers and Supervisors Will Aid Employers Facing Harassment Claims 

The bright line test that the Court adopted for determining who is deemed a “supervisor” in Title VII cases eliminates murkiness and provides a clear test that reviewing courts can easily apply. The Court noted that it typically will be known before litigation is commenced whether an alleged harasser was a supervisor, and if not, it will become clear to both sides after discovery.  The Court goes on to say “once this is known, the parties will be in a position to assess the strength of a case and to explore the possibility of resolving the dispute.  Where this does not occur, supervisor status will generally be capable of resolution at summary judgment.”  The Court clearly wanted employers to be able to get the supervisor issue resolved early in a lawsuit so that both sides will know who bears the burden of proof and can pursue early resolution of the case based on the strength of the evidence. 

Employees Still Protected, but Must Prove Company Negligence 

The Court’s majority, which includes Justices Alito, Roberts, Scalia, Kennedy and Thomas, states that employees who face harassment by co-workers who possess the authority to inflict psychological injury by assigning unpleasant tasks or by altering the work environment in objectionable ways will still be protected under Title VII.  The Court states that such victims will be able to prevail “simply by showing that the employer was negligent in permitting this harassment to occur, and the jury should be instructed that the nature and degree of authority wielded by the harasser is an important factor to be considered in determining whether the employer was negligent.”  According to the majority, the fact that harassing co-workers may possess varying degrees of authority over daily tasks will not be a problem under the negligence standard “which is thought to provide adequate protection for tort plaintiffs in many other situations.” 

Dissent Would Follow EEOC’s Guidance and Extend “Supervisor” Status Based on Authority to Direct an Employee’s Daily Activities 

Justice Ginsburg, joined by Justices Breyer, Sotomayor and Kagan, wrote a lengthy dissent opining that the majority’s rule diminishes the force of Faragher andEllerth, ignores the reality of the current workplace and strays from the objective of Title VII in preventing discrimination in the workplace.  The dissent favors the EEOC’s Guidance, believing that employees who direct subordinates’ daily work are supervisors.  Justice Ginsburg wrote that although one can walk away from a fellow employee’s harassment, “[a] supervisor’s slings and arrows, however, are not so easily avoided.”  The dissent recites numerous cases in which a person vested with authority to control the conditions of a subordinate’s daily work life used his position to aid his harassment, and then points out that in none of the cases would the majority’s “severely confined definition of supervisor yield vicarious liability for the employer.”  The dissent concludes that the majority decision embraces a position that relieves scores of employers of responsibility for the behavior of the supervisors they employ.  

Conclusion – Victim Must Prove Employer Negligence When Harassed by a Non-Supervisor 

The Vance opinion means that employees alleging harassment by another employee who does not have the power to hire, fire, promote, transfer or discipline them, bear the burden of proving the employer’s negligence in order for the employer to be liable for the harassment.  This means the alleged victim must prove that the employer knew or should have known of the conduct and failed to take immediate and appropriate corrective action.


Disclaimer: This article is designed to provide general information on pertinent legal topics. The statements made are provided for educational purposes only. They do not constitute legal advice and are not intended to create an attorney-client relationship between you and Holland & Hart LLP. If you have specific questions as to the application of the law to your activities, you should seek the advice of your legal counsel.


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