Supreme Court Limits Vicarious Liability In Harassment Cases

By Joe Leibovich
(901) 328-8269

The United States Supreme Court has narrowed the definition of who is a supervisor for purposes of sexual harassment cases.  The effect of this is that employers will have an easier time defending sexual harassment cases.

The Court in Vance v. Ball State University, 570 U.S. _____ (2013), took on a question left open by prior decisions Burlington Industries, Inc. v. Ellerth, 524 U.S. 742 (1998) and Faragher v. Boca Raton, 524 U.S. 775 (1998).

Both Ellerth and Faragher dealt with when a company can be held responsible for sexual harassment.  In these cases, the Court held that employers are vicariously liable for harassment by a supervisor when it leads to a tangible employment action, including firing, hiring, failure to promote, job reassignment, or loss in benefits.  In such cases, an employer is strictly liable for the harassment, whether or not the employer knew about the harassment.

Furthermore, the Court previously held that a company is vicariously liable for “hostile work environment” harassment by a supervisor, even where there is no tangible job employment action.  In such cases, employers can attempt to raise a defense (which is the employer’s burden to prove) that the employer exercised reasonable case to prevent and correct harassing behavior, and that the plaintiff failed to take advantage of such opportunities.

In cases of non-supervisor harassment, courts look to whether or not the employer knew or should have reasonably known about the harassment, but failed to take remedial action.

So, it becomes important to know who is and is not a supervisor when defending claims of sexual harassment.

Today’s decision in Vance stated:

“We hold that an employer may be vicariously liable for an employee’s unlawful harassment only when the employer has empowered that employee to take tangle employment actions against the victim…”

In doing this, the Court rejected the EEOC’s definition of “supervisor,” which lower courts had been utilizing.  Under that definition, a supervisor was one who had the ability to exercise significant direction over an employee’s work. This could have led to situations where a co-worker who had some oversight, even for a short period, could be deemed to be a supervisor.

The Court’s 5-4 decision by Justice Alito is a victory for employers, but by no means signals that employers can not be liable for non-supervisory harassment.  The Court stated “As an initial matter, an employer will always be liable when its negligence leads to the creation or continuation of a hostile work environment.  And even if an employer concentrates all decisionmaking authority in a few individuals, it will likely not isolate itself from heightened liability under Faragher and Ellerth.  If an employer does attempt to confine decisionmaking power to a small number of individuals, those individuals will have a limited ability to exercise independent discretion when making decisions and will likely rely on other workers who actually interact with affected employees. … Under those circumstances, the employer may be held to have effectively delegated actions to the employees on whose recommendations it relies.”

Overall, Vance does not change the landscape much.  But it does provide some help to employers for the actions of individuals who can’t directly or indirectly take tangible job actions against employees or applicants.

While Vance gives employers some comfort, it is important for employers to continue to provide an avenue for reporting harassment that will lead to proper investigations and results.  An employer can not simply turn a blind eye to an atmosphere charged with sexual harassment.  And, employers still need to be aware that even if an individual can not directly fire or discipline an employee, that individual may still be a supervisor if their input is given weight in employment decisions.  Proper policies and training remain invaluable in this context.

EEOC Files Lawsuits Over Background Checks

By Joe Leibovich
(901) 328-8269

The EEOC has filed two lawsuits, including one against Tennessee based Dollar General Corp., over the use of criminal background checks.  The lawsuits filed this week against Dollar General and BMW essentially allege that the background checks have a disparate impact on minority employees and applicants.

The EEOC takes the position that background checks affect African Americans adversely due to disparities in arrest and convict rates between minority and White individuals.

The Agency issued guidance to employers in April 2012 regarding the use of criminal background checks.  In that guidance, the EEOC reiterated its position that the fact of an arrest has little meaning, as that does not provide proof of criminal wrongdoing.

On the other hand, a conviction is reasonable proof that the person did what they were accused of.

But, according to the Agency, that alone is not enough in light of the disparate impact on African Americans.  The EEOC turned to a 1977 Eighth Circuit case, Green v. Missouri Pacific Railroad, 549 F.2d 1158 (8th Cir. 1977), to describe when the use of criminal background checks may be valid.  The EEOC listed three Green factors

1.  The nature and gravity of the offense or conduct;

2.  The time that has passed since the offense or conduct and/or completion of the sentence; and

3.  The nature of the job held or sought.

The guidance went in depth into each of these factors, and ultimately provided a set of “Employer Best Practices”.  The EEOC states employers should:

  • Eliminate policies or practices that exclude people from employment based on any criminal record.
  • Train managers, hiring officials, and decisionmakers about Title VII and its prohibition on employment discrimination.
  • Develop a narrowly tailored written policy and procedure for screening applicants and employees for criminal conduct.
  • Identify essential job requirements and the actual circumstances under which the jobs are performed.
  • Determine the specific offenses that may demonstrate unfitness for performing such jobs.
  • Identify the criminal offenses based on all available evidence.
  • Determine the duration of exclusions for criminal conduct based on all available evidence.
  • Include an individualized assessment.
  • Record the justification for the policy and procedures.
  • Note and keep a record of consultations and research considered in crafting the policy and procedures.
  • Train managers, hiring officials, and decisionmakers on how to implement the policy and procedures consistent with Title VII.
  • When asking questions about criminal records, limit inquiries to records for which exclusion would be job related for the position in question and consistent with business necessity.
  • Keep information about applicants’ and employees’ criminal records confidential. Only use it for the purpose for which it was intended.

The EEOC has indicated this issue is a high priority for the Agency.  And these new lawsuits would seem to indicate that is the case.  Both Dollar General and BMW deny their policies are unlawful.

It is certainly not possible to predict whether or not the EEOC’s lawsuits will ultimately prevail.  But, it is vital for employers to note that the EEOC is looking at these policies.  Both lawsuits do stem from individual complaints, but it is possible the Agency could aggressively pursue employers over this issue.

In any event, and certainly while we wait for the results of this litigation, employers should take a look at their background check policies to see if they are in compliance with the EEOC’s guidance.


Vickie Moffett Completes Regal Service

Shuttleworth PLLC associate, Vickie L. Moffett, recently served as Queen of the Grand Krewe of Ptolemy, one of ten Grand Krewes of Carnival Memphis, during Carnival Week 2013 festivities. Krewe activities included visits to various local children’s charities, nursing homes and developmental centers.

Since the inception of The Carnival Memphis Children’s Charity Initiative, Carnival Memphis and the Grand Krewes have raised over $1,500,000 with matching funds for local children’s charities. This year’s charities are Perea Pre School, Ronald McDonald House and YWCA of Greater Memphis.