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The Supreme Court Holds That Title VII Imposes Strict Liability on an Employer for Harassment by a Supervisor Only if the Supervisor Has the Power to Take "Tangible Employment Actions"

By a 5-4 vote, the Supreme Court narrowed the circumstances under which an employer can be held strictly liable for the actions of a supervisor in an harassment case.  The case is Vance v. Ball State University (June 24, 2013).

In a typical harassment case, one of the key issues is whether the employer is vicariously liable for the actions of a lower level employee who has harassed a co-worker.  An employer faces potential vicarious liability both under a "strict liability" theory (if the harasser is a supervisor) and under a "negligence" theory (if the harasser is not a supervisor).  The majority opinion in Vance summarized the underlying legal principles as follows:

Under Title VII, an employer’s liability for such 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 in controlling working conditions. In cases in which the harasser is a "supervisor," however, different rules apply. If the supervisor’s harassment culminates in a tangible employment action, the employer is strictly liable. But if no tangible employment action is taken, the employer may escape liability by establishing, as an affirmative defense, 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. Under this framework, therefore, it matters whether a harasser is a "supervisor" or simply a co-worker.

(citations omitted).  The Court addressed the definition of a "supervisor" in this context.

The plaintiff (Vance) is a black employee of Ball State who alleged claims for racial discrimination.  The specific issue in the case related to conduct by Davis, a white woman.  The Court summarized the relevant facts as follows:

During the time in question, Davis, a white woman, was employed as a catering specialist in the Banquet and Catering division. The parties vigorously dispute theprecise nature and scope of Davis’ duties, but they agreethat Davis did not have the power to hire, fire, demote, promote, transfer, or discipline Vance.

Vance claimed that he was racially harassed by Davis, but the district court rejected the claim because (1) Davis was not a "supervisor" because she had no power to take tangible employment actions with respect to Vance, and thus Ball State was not strictly liable; and (2) Ball State took actions in response to the specific conduct about which Davis complained, and thus Ball State was not negligent.  The Seventh Circuit affirmed.

Writing for the majority, Justice Alito noted that the lower courts were in conflict about the definition of "supervisor" in this context:

Under Ellerth and Faragher, it is obviously important whether an alleged harasser is a "supervisor" or merely a co-worker, and the lower courts have disagreed about the meaning of the concept of a supervisor in this context. Some courts, including the Seventh Circuit below, have held that an employee is not a supervisor unless he or she has the power to hire, fire, demote, promote, transfer, or discipline the victim.  Other courts have substantially followed the more open-ended approach advocated by the EEOC’s Enforcement Guidance, which ties supervisor status to the ability to exercise significant direction over another’s daily work.

Justice Alito adopted the Seventh Circuit's approach and rejected the EEOC's interpretation:

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 tangible employment actions against the victim, i.e., 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." We reject the nebulous definition of a "supervisor" advocated in the EEOC Guidance and substantially adopted by several courts of appeals.

Justice Alito criticized the alternative definition as vague and unworkable:

The alternative approach advocated by petitioner and the United States would make matters far more complicated and difficult. The complexity of the standard they favor would impede the resolution of the issue before trial. With the issue still open when trial commences, the parties would be compelled to present evidence and argument on supervisor status, the affirmative defense, and the question of negligence, and the jury would have to grapple with all those issues as well. In addition, it would often be necessary for the jury to be instructed about two verydifferent paths of analysis, i.e., what to do if the alleged harasser was found to be a supervisor and what to do if the alleged harasser was found to be merely a co-worker.

The majority thus held that Davis was not a "supervisor" and affirmed the judgment of the Seventh Circuit.

In a dissenting opinion, Judge Ginsburg criticized the majority for ignoring the realities of the workplace:

 The Court today strikes from the supervisory categoryemployees who control the day-to-day schedules and assignments of others, confining the category to those formally empowered to take tangible employment actions. The limitation the Court decrees diminishes the force of Faragher and Ellerth, ignores the conditions under which members of the work force labor, and disserves the objective of Title VII to prevent discrimination from infecting the Nation’s workplaces. I would follow the EEOC’s Guidance and hold that the authority to direct an employee’s daily activities establishes supervisory status under Title VII.

David C. Holmes is a Houston employment lawyer with The Law Offices of David C. Holmes