June 25, 2013

Who's the Boss? In Vance, Supreme Court Defines "Supervisor" for Purposes of Title VII Harassment Claims

Ruling Potentially Limits Employer Liability
Holland & Knight Alert
David J. Lisko

Since two landmark U.S. Supreme Court decisions in 1998, the courts have applied different rules to sexual and other discriminatory harassment claims under Title VII of the Civil Rights Act of 1964 ("Title VII") based on whether the harasser is a supervisor or a co-worker. It is substantially more difficult for an employer to avoid liability for harassment by a supervisor. But courts have disagreed about when an individual qualifies as a supervisor for this purpose. Some, including the First, Seventh, and Eighth U.S. Circuit Courts of Appeal, have limited "supervisors" to those employees who have the authority to take tangible job actions, such as hiring, firing, demoting, promoting or transferring other employees. But the Second, Fourth, and Ninth Circuits, as well as the Equal Employment Opportunity Commission (EEOC), have ruled that a supervisor is any employee with responsibility for the daily work of other employees.

In a big win for employers, the Supreme Court, by a 5-4 vote, has rejected the EEOC's position and adopted the narrow definition: a supervisor is an employee who has the authority to take tangible job actions. Vance v. Ball State University, No. 11-556 (June 24, 2013). This decision should make it harder for plaintiffs to prove sexual and other discriminatory harassment claims under Title VII.

Legal Background

Under Title VII, an employer’s liability for workplace harassment may depend on the status of the harasser. If the harassing employee is the victim’s co-worker, the employer is liable only if it was negligent, that is, if it "knew or should have known" about the harassment but failed to take prompt and appropriate action to stop the harassment. But in cases in which the harasser is a "supervisor," different rules apply. If the supervisor’s harassment culminates in a tangible employment action (i.e., "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"), the employer is strictly liable and has no defense.

If no tangible employment action is taken, an employer generally is still "vicariously liable" for the supervisor's harassment, but may escape liability by showing that: (1) the employer exercised reasonable care to prevent and correct any harassing behavior, and (2) that the plaintiff unreasonably failed to take advantage of the preventive or corrective opportunities that the employer provided. It is easier for a plaintiff to prove, and harder for an employer to escape liability for, harassment by a supervisor.

The Dispute

Maetta Vance, an African American woman, sued her employer, Ball State University (BSU), alleging that a fellow employee, Saundra Davis, created a racially hostile work environment in violation of Ti­tle VII. The district court granted summary judgment to BSU. It held that BSU was not vicariously liable for Davis’ alleged actions be­cause Davis, who could not take tangible employment actions against Ms. Vance, was not a supervisor. The Seventh Circuit agreed that only those employees who can take tangible employment actions are supervisors and agreed that Davis lacked such authority.

Supreme Court Decision

In Vance, the Supreme Court adopted the Seventh Circuit approach: under Title VII, a "supervisor" is an employee with the power to take "tangible employment actions" against another employee, i.e., actions that cause 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." Thus, an employee who merely has the authority to direct other employees' daily work is not a supervisor under Title VII and an employer will not be held vicariously liable for harassment by such an employee. By restricting who counts as a "supervisor," the Court has handed employers a significant victory and much needed clarity.

Practical Ramifications

Back when Americans worked in factories, mills or labored in similarly hierarchical workplaces, the distinction between "supervisors" and coworkers was more clear. In modern workplaces, there are often numerous employees with some amount of authority over what happens during the workday. For example, "leads" and "working forepersons" may control certain aspects of other employees' activities but may not have authority to change employees' tangible job status.

The Vance decision makes it easier for employers to identify the "supervisors" for whom they will be vicariously liable, and will make it harder for plaintiffs to prove their harassment claims. If an employee possesses the authority to take "tangible employment actions" against another employee, he or she is a supervisor for Title VII harassment purposes; if not, he or she is not. This clarity allows employers to identify and more closely train and monitor the conduct of those "supervisors" for whose conduct they will be vicariously liable. It will also make it more difficult for employees to prove harassment claims against those employees who have the authority only to direct other employees' day-to-day activities.

But employers cannot ignore the activities of employees with authority to direct day-to-day activities. The Supreme Court stated that in determining whether an employer was negligent in failing to learn about and stop harassment by such employees, the nature and degree of authority wielded by the harasser will be an important factor in determining negligence.

Employers should use the Vance decision as an opportunity to retrain all employees about the employers' policy prohibiting discriminatory harassment and the procedures to report and remedy allegations of harassment.

   

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Information contained in this alert is for the general education and knowledge of our readers. It is not designed to be, and should not be used as, the sole source of information when analyzing and resolving a legal problem. Moreover, the laws of each jurisdiction are different and are constantly changing. If you have specific questions regarding a particular fact situation, we urge you to consult competent legal counsel.


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