SEXUAL HARASSMENT: TRENDS & DEVELOPMENTS. Presented by Kent R. Smith Jackson Walker L.L.P.

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1 SEXUAL HARASSMENT: TRENDS & DEVELOPMENTS Presented by Kent R. Smith Jackson Walker L.L.P. Sexual Harassment Defined Sexual harassment, of course, is a form of sex discrimination under Title VII. Meritor Savings Bank v. Vinson, 477 U.S. 57, (1986). While Title VII does not define sexual harassment, the EEOC has defined it as Unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature when (1) submission to such conduct is made either explicitly or implicitly a term or condition of an individual s employment, (2) submission to or rejection of such conduct by an individual is used as the basis for employment decisions affecting such individual, or (3) such conduct has the purpose or effect of unreasonably interfering with an individual s work performance or creating an intimidating, hostile or offensive working environment. 29 C.F.R (a). This definition establishes two different types of sexual harassment, (1) quid pro quo sexual harassment and (2) hostile environment sexual harassment. Meritor Savings Bank v. Vinson, 477 U.S. 57, (1986); EEOC Policy Guidance on Current Issues of Sexual Harassment (1990). Quid pro quo harassment occurs when submission to or rejection of the harassing conduct by an individual is used as the basis for an employment decision. EEOC Policy Guidance on Current Issues of Sexual Harassment (1990); 29 C.F.R (a)(2), (3). Harassment is unwelcome when submission to or rejection of the conduct is made either explicitly or implicitly a term or condition of an individual s employment. EEOC Policy Guidance on Current Issues of Sexual Harassment (1990); 29 C.F.R (a)(1) Jackson Walker L.L.P. All rights reserved.

2 The U.S. Supreme Court has held that for harassment to violate Title VII it must be sufficiently severe or pervasive so as to alter the terms or conditions of the individual s employment. Id., at 67. Where the harassment is committed by a co-employee, an employer is only liable when it has been negligent either in discovering or remedying the harassment. Where an employer has taken reasonable steps to discover and rectify acts of sexual harassment by coemployees, it will not be held liable. Williamson v. City of Houston, 148 F.3d 462, (5 th Cir. 1998). In Meritor Saving Bank v. Vinson, the Court declined to resolve the issue of an employer s liability for the sexual harassment of it s supervisors. It only noted that courts should look to agency principles in deciding whether an employer was liable for it s supervisors harassment of another employee. Id., at 72. Employer Liability Revisited In 1998, the Supreme Court returned to the issue of employer liability for sexual harassment. In Burlington Industries, Inc. v. Ellerth, 524 U.S. 742 (1998) and Faragher v. City of Boca Rotan, 524 U.S. 775 (1998), the Supreme Court held that employers are vicariously liable for the unlawful harassment of their supervisors. However, the Court also created a limited affirmative defense for employers. Where no tangible employment action is taken, the employer can raise an affirmative defense in avoidance of liability by showing (1) that it exercised reasonable care to prevent and promptly correct any sexually harassing behavior and (2) that the employee unreasonably failed to take advantage of any preventive or corrective opportunities provided by the employer or to otherwise avoid harm. If a tangible employment action is taken against an employee who was the subject of severe or pervasive sexual harassment, then an employer is held vicariously liable for the harassment of it s supervisor regardless of any preventive steps taken by the employer. Sexual Harassment: Trends & Developments Page 2

3 Clarification of What Constitutes Sexual Harassment In 1998, the Supreme Court also clarified what constitutes sexual harassment in Faragher v. City of Boca Rotan, 524 U.S. 775 (1998) and Oncale v. Sundowner Offshore Services, 523 U.S. 75 (1998). In Faragher, in addition to addressing employers vicarious liability, the Supreme Court stated that simple teasing, offhand comments and isolated incidents, unless extremely serious, do not amount to discriminatory changes in the terms and conditions of employment. In so holding the Court said that to be actionable under Title VII, the environment must be both objectively and subjectively offensive. In other words, a reasonable person would have to find it to be hostile or abusive and the victim must in fact perceive it to be so. In Oncale v. Sundowner, the Supreme Court held that Title VII applied to harassment committed against members of the same sex. However, the Court again reiterated, that to be actionable, the harassment has to be based upon sex and that Title VII does not prohibit all forms of harassment in the work place. Same sex harassment was also recently held to be covered under the Texas Human Rights Act. Dillard Department Stores, Inc. v. Gonzales, S.W.3d, 2002 WL (Tex. App.-El Paso 2002). RECENT DEVELOPMENTS What is a Supervisor? Unfortunately, the Ellerth and Faragher cases give us little clue as to what constitutes a supervisor. The EEOC enforcement guidance on vicarious liability states that an individual qualifies as a supervisor if he or she (1) has authority to undertake or recommend tangible employment decisions affecting the employee; or, (2) the individual has authority to direct the employee s daily work activities. EEOC Enforcement Guidance: Vicarious Employer Liability Sexual Harassment: Trends & Developments Page 3

4 For Unlawful Harassment By Supervisors (1999). While this may seem straightforward at first, the application of this definition can be much more difficult. In Hall v. Bodine Electric Co., 276 F.3d 345, (7 th Cir. 2002), the Seventh Circuit Court of Appeals recently held that the fact that one employee has authority to oversee some aspects of another employee s job performance does not necessarily make them a supervisor under Title VII. In that case Ms. Hall complained of sexual harassment by another employee by the name of Samuel Lopez. She had been told that Mr. Lopez had the authority to assign her to specific work assignments and that she was required to follow his instructions. Following Seventh Circuit precedent, the Court stated that the essence of supervisory status is the authority to affect the terms and conditions of the victim s employment. This authority primarily consists of the power to hire, fire, demote, promote, transfer or discipline an employee. Absent at least some of this authority, the Court noted, the employee does not qualify as a supervisor. The authority of Mr. Lopez to oversee Ms. Hall s work was not sufficient to establish a supervisory relationship in the absence of any authority to directly affect the terms and conditions of employment. This view appears to be the trend in cases where an alleged harasser is a low-level supervisor. Last year U.S. District Courts in New York and San Antonio came to a similar conclusion. Mark v. Otis Elevator, 2001 WL (S.D. N.Y. 2001); Rosales v. San Antonio, 2001 WL (W.D. Tex. 2001). In the Rosales case, the Court considered the question of how much and what kind of authority an individual must possess to be a true supervisor under the Faragher case. The District Court in that case decided that under Faragher it is only where the supervisor has the authority to affect the terms and conditions of employment that they will be classified as a true supervisor for the purposes of imputing liability to the employer. Since the Sexual Harassment: Trends & Developments Page 4

5 crew leader in that case did not have authority to hire, fire, reward, promote or significantly discipline, the Court found that he was not a supervisor under the Faragher test. In another supervisor case, the Seventh Circuit considered whether the fact that a supervisor was not in the direct chain of command but was still a superior was a supervisor for purposes of raising the Faragher affirmative defense. Gawley v. Indiana University, 276 F.3d 301 (7 th Cir. 2001). This case was an appeal from a summary judgment in favor of the University. One of the issues was whether the alleged harasser was a supervisor under the Faragher affirmative defense. After discussing the facts which showed that although the harasser could not hire or fire Gawley, the Court noted that he could instigate disciplinary proceedings against her and had substantial control over the equipment she could use and how she performed her job. The Court also noted that the harasser apparently was aided in his harassment by his superior position. However, the Court sidestepped the issue and assumed that the individual was a supervisor and affirmed summary judgment on the University s affirmative defense on other grounds. Mere Hostility vs. Based on Sex Reiterating that in sexual harassment cases Title VII only prohibits actions that were based on sex, the D.C. Circuit relied on the Supreme Court s decision in Oncale v. Sundowner, in holding that obscene gestures, slashing of tires, vulgar and sexually demeaning comments did not constitute sexual harassment. Davis v. Coastal Int l Security, 275 F.3d 1119 (D.C. Cir. 2002). The conduct in that case arose out of a rancorous employment dispute that started after Davis disciplined two employees. The resulting harassment included the slashing of Davis tires, being told that he made the other employees sick and that he was aggravating. The other Sexual Harassment: Trends & Developments Page 5

6 employees also grabbed their crotch in front of him, made kissing gestures and used a phrase describing oral sex. The Court held that in a same sex case a Plaintiff can show that the harassment rises to the level of illegal sexual harassment if he can show 1) that the behavior was motivated by actual homosexual desire, 2) that the harassment was framed in sex specific and derogatory terms, 3) that the harasser was motivated by general hostility toward members of the same gender in the workplace or 3) that there was direct evidence of how the harasser treated members of both sexes in a mixed sex workplace. After reviewing the evidence, the Court noted that it was clear that the harassers in this case were motivated by a workplace grudge and not by sexual attraction. As such, the harassment was not based on sex. The Court also noted that such language and gestures, especially when used by men, are simply expressions of animosity or juvenile provocation. Tangible Employment Action The question of whether constructive discharge constitutes a tangible employment action for purposes of asserting the Faragher defense continues to be debated between the Federal Courts of Appeal. In 2001, the Eighth Circuit implied that constructive discharge did constitute a tangible employment action. Jackson v. Arkansas Dept. of Education, 272 F.2d 1020 (8 th Cir. 2001) If the Eighth Circuit continues with this interpretation in later cases, it will join the Third Circuit [Cardenas v. Massey, 269 F.2d 251 (3 rd Cir. 2001)] in holding that constructive discharge is a tangible employment action. However, the Second Circuit holds to the contrary [Caridad v. Metro-North Commuter Railroad, 191 F.2d 283 (2 nd Cir. 1999)] as does the Tenth Circuit. Mallinson-Montague v. Pocrnick, 224 F.3d 1224 (10 th Cir. 2000). Sexual Harassment: Trends & Developments Page 6

7 In the Mallinson case, the Tenth Circuit discussed in depth the concept of tangible employment action. In that case, Mallinson-Montague, and other former loan officers of ProBank sued the bank and others for sexual harassment committed by their former supervisor, James Pocrnick. Pocrnick repeatedly sexually harassed the Plaintiffs and retaliated against their rejection of his advances by denying them business leads and rejecting loans that they originated. After reporting the harassment and the ensuing investigation, the Plaintiffs quit after they found the working conditions intolerable. On appeal of a jury verdict, ProBank argued that only if the Plaintiffs working conditions had been so intolerable as to constitute a constructive discharge would there be a tangible employment action so as to prohibit it from raising the affirmative defense under Faragher. In rejecting this argument, the Tenth Circuit said that the only relevant inquiry on the tangible employment action issue was whether the Plaintiffs had demonstrated a materially adverse change in the terms and conditions of employment. Citing the Second Circuit s decision in Caridad v. Metro-North Commuter Railroad, the Court noted that not every constructive discharge would be a tangible employment action under Faragher. The Court held that evidence of the loss of business opportunities and the disapproved loans originated by the Plaintiffs were sufficient to constitute a tangible employment action. Reaching a similar conclusion but for different reasons, the Fifth Circuit on March 15th held that a demotion without any reduction in pay or other economic harm can still constitute a tangible employment action. Green v. The Administrator of the Tulane Educational Fund, F.3d, 2002 WL (5 th Cir. 2002). The Court reasoned that although the Supreme Court noted in Faragher and Ellerth that a tangible employment action inflicts economic injury in most cases, the Supreme Court never stated that an economic loss was required in all cases. Sexual Harassment: Trends & Developments Page 7

8 On another note, the Fifth Circuit also held in Green that harassment that resulted from personal animosity between a supervisor and his subordinate after a failed intimate relationship was harassment based on sex under Oncale. OTHER RECENT CASES IN THE FIFTH CIRCUIT The Fifth Circuit has continued to consider the extent and nature of sexual harassment liability in various contexts. Although not a sexual harassment case, the Court considered the issue of vicarious liability in Arguello v. Conoco, Inc. 207 F.3d 803 (5 th Cir. 2000). Conoco was sued for racial harassment and discrimination in a public accommodation in violation of Title II of the Civil Rights Act of 1964 and 42 U.S.C because employees at various Conoco stores had harassed and abused African-American and Hispanic customers. The District Court granted summary judgment on all claims. One of the issues on appeal was whether Conoco, Inc. was liable for the acts of the employees. The employees who committed the harassment and abuse actually worked for stores that were independently owned and operated but that carried the Conoco brand. The Court rejected Conoco s argument that there was no vicarious liability for the harassment of non-supervisory employees under the Ellerth/Faragher decisions. Such a rule in public accommodation cases, the Court noted, would essentially be a no liability rule since most customers deal only with non-supervisory employees. Instead, the Fifth Circuit held that courts should apply standard agency principles to determine whether the acts complained of were within the scope of employment. The Court reversed the granting of summary judgment on this issue as the Plaintiffs had presented enough evidence to raise a question of fact as to whether the employees had been acting within the scope of their employment. In Mota v. University of Houston Health Science Center, 261 F.3d 512 (5 th Cir. 2001), Professor Mota, a native of Venezuela, brought suit for retaliation and same sex harassment. He Sexual Harassment: Trends & Developments Page 8

9 alleged a pattern of same sex harassment from his supervisor with repeated threats to his position and immigration status if he did not go along with the harassment. Some nine months after the harassment began, Mota filed a written complaint with the University. The University s investigation determined that there was no evidence of harassment. Mota was eventually terminated when he failed to return to work after an unpaid leave of absence. Mota had tape recordings of the harassment from his supervisor which were never given to the University during its investigation but were played for the jury at trial. The jury returned a six figure verdict against the University. One of the issues on appeal was whether the nine months between the time the harassment began and the first written complaint of harassment to the University amounted to Mota unreasonably taking advantage of the University s corrective and preventive procedures. In affirming the judgment, the Court held that although the nine month delay could be an excessive delay, in light of the fact that during that period of time Mota had been repeatedly threatened with retaliation unless he complied with the harassment, nine months was not an unreasonable delay. The Court also held that Mota s refusal to give the tape recordings to the University would not justify setting aside the jury s verdict for failure to use the University s corrective and preventive procedures because He [Mota] may have viewed the production of additional evidence, such as recordings of conversations, as futile, given his concerns over the effectiveness of the panels inquiry In a more recent case, the Fifth Circuit affirmed a summary judgment in favor of an employer that promptly investigated reported harassment and took prompt remedial action. Woods v. Delta Beverage Group, Inc., 274 F.3d 295 (5 th Cir. 2001). Ms. Woods worked for Delta from June 18, 1998 to July 22, During that time she reported harassment by a co- Sexual Harassment: Trends & Developments Page 9

10 employee. Within one day of the report, the incident had been investigated and the harasser had been instructed to cease all such conduct, that if it occurred again he could be fired and that the harassment was going to be noted in his personnel file. Woods reported no other harassment during the next two weeks. After that time she did not show back up for work again. In her subsequent suit, Woods alleged that the harassment continued after the harasser had been reprimanded. The Fifth Circuit held that the employer was not liable for harassment of which it had no knowledge and which Woods failed to report. The Court also stated that the employer did not have to fire the harasser and that the actions taken under the circumstances were sufficient prompt remedial action. However, the Court also noted that had the harassment continued and been reported, and Delta had still only reprimanded the harasser, then such might not rise to the level of prompt remedial action. Interestingly, the Fifth Circuit recently upheld an arbitration award reversing the termination of an employee that committed sexual harassment. In Weber Aircraft, Inc. v. General Warehousemen and Helpers Union Local No. 767, 253 F.3d 821 (5 th Cir. 2001), an employee by the name of Sewell had been discharged by the company for repeated incidents of sexual harassment. The union filed a grievance under the collective bargaining agreement that provided for arbitration and the arbitrator determined that there was no just cause for the termination given the facts of the case and the employee s prior record of service. The arbitration award ordered that Sewell be reinstated without back-pay. Weber filed suit to vacate the award, and the District Court granted Weber s motion for summary judgment. The Fifth Circuit reversed and reinstated the award holding that the arbitrator did not exceed his authority and that the award did not violate any public policy against sexual harassment. Sexual Harassment: Trends & Developments Page 10

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