Third Circuit Employment Law 101: Title VII Liability for Non-Supervisors

Our old buddy Robert Rank-And-File from Pennsylvania-New Jersey-Delaware, Inc. is having problems at work again. This time, however, the culprit is not Sally Supervisor. It’s Lisa Leadperson.

What is your company’s potential exposure here? Find out after the jump.

Oh, that Lisa! She must not have been paying too much attention during that anti-harassment training class Pennsylvania-New Jersey-Delaware, Inc. held last month. Because she’s at it with the dirty jokes and the lewd comments. Heck, last week, she even brushed up against Robert’s butt.

And Robert has had enough. However, instead of following the employee handbook and reporting Lisa to both his manager and to HR, Robert went straight to the EEOC and filed a charge of discrimination. Now he’s filed a Title VII lawsuit in which he alleges sexual harassment and gender discrimination.

In the Third Circuit, “respondeat superior” liability (i.e., the employer’s responsibility of the acts of its employees) for harassment by non-supervisory employees only exists where the employer “knew or should have known about the harassment, but failed to take prompt and adequate remedial action.”

There can be constructive notice of unlawful workplace harassment in two situations:

Where an employee provides “management level” personnel with enough information to raise a probability of unlawful harassment in the mind of a reasonable employer; or
Where the harassment is so pervasive and open that a reasonable employer would have had to be aware of it.

Let’s return to our hypothetical. That cagey Lisa, wouldn’t you know, she was always careful to make sure that no one else was around when she harassed Robert. So, number 2 is out of play. But what about number 1? Can our employer still be held liable for Lisa’s actions? Probably not.

Federal courts in PA, NJ, and DE draw upon agency principles for guidance on the definition of “management level” employee. In Huston v. Proctor & Gamble Prods. Corp., the Third Circuit developed a two-part test to determine who may qualify as management level personnel:

[A]n employee’s knowledge of allegations of coworker sexual harassment may typically be imputed to the employer in two circumstances: first, where the employee is sufficiently senor in the employer’s governing hierarchy, or otherwise in a position of administrative responsibility over employees under him, such as a departmental or plant manager, so that such knowledge is important to the employee’s general managerial duties. In this case, the employee usually has the authority to act on behalf of the employer to stop the harassment, for example, by disciplining employees or by changing their employment status or work assignments….

Second, an employee’s knowledge of sexual harassment will be imputed to the employer where the employee is specifically employed to deal with sexual harassment. Typically, such an employee will be part of the employer’s human resources, personnel, or employee relations group or department. Often an employer will designate a human resources manager as a point person for receiving complaints of harassment. In this circumstance, employee knowledge is imputed to the employer based on the specific mandate from the employer to respond to and report sexual harassment.

It turns out our Lisa was just a lead person. She had no authority to hire, fire, or discipline. And the company had never trained her to deal with claims of sexual harassment. By failing to report Lisa’s behavior internally, Robert not only deprived his employer of the opportunity to investigate and take reasonable actions designed to make sure that Lisa would not repeat her unlawful behavior, but he’s also stuck with a loser of a lawsuit.