Employer Liability For Hostile Environments

An employee at your office makes unwelcome lewd comments about your appearance and repeatedly urges you to go out on a date. This same employee also has a tendency to brush up against you when passing in the hallway. You consider yourself to be a victim of a hostile work environment and you weigh commencing a legal action.

An important legal question is whether you may hold your employer liable for the harassment caused by such an employee. This question is often at the center of harassment claims because there can be no recovery— even against individuals—unless your employer's liability is established. Today's column addresses employer liability in hostile work environment cases under Federal, state and city anti-discrimination laws.

Differing Standards

Employer liability in hostile work environment cases, under Federal law, is determined by use of either agency or negligence theories depending on whether the harassment is caused by supervisors or co-workers. Subject to an "affirmative defense" (described below), employers are strictly liable, under agency theory, when the harassment is caused by a supervisor. When a co-worker is the harasser, an employer is only liable if it knew (or reasonably should have known) of the hostile work environment but failed to take appropriate remedial action. This legal standard for co-worker harassment is based on negligence theory.

Under Federal law, employers are not always subject to strict liability even when supervisors cause the harassment. Rather, such harassment must culminate in a "tangible employment action" (e.g. termination of employment, failure to promote, demotion, reassignment with significantly different responsibilities). An example of a hostile work environment culminating in a tangible employment action is a victim's firing because he or she rejected a supervisor's sexual advances.

When no "tangible employment action" is taken, your employer is permitted to invoke the "Faragher- Ellerth" affirmative defense to avoid liability under Federal law. This affirmative defense protects an employer and extinguishes its liability for supervisory harassment provided the employer can demonstrate that: (a) it exercised reasonable care to prevent and correct promptly any harassment; and (b) the victim unreasonably failed to take advantage of the employer's preventive or corrective opportunities.

Always Complain

Therefore, if your employer distributed an anti-discrimination policy containing a complaint procedure, you must comply with that procedure and complain of any harassment; otherwise your employer will likely avoid liability under Faragher-Ellerth. Fortunately, not all failures to complain of harassment are deemed "unreasonable." For example, if you can demonstrate that your employer retaliates against complainants or typically takes no action in response to harassment complaints, your failure to complain will not extinguish your employer's liability. As for co-worker harassment, Federal law applies the abovedescribed negligence standard.

State law differs somewhat from Federal law by generally avoiding agency and negligence theories. Under state law, the victim must demonstrate that the employer had knowledge of and acquiesced in the harassment or subsequently condoned it. Yet, in practical terms, a victim will likely satisfy this state standard by demonstrating that the employer responded with "calculated inaction" to a hostile work environment.

With regard to supervisors, the state's highest court has suggested that the Faragher-Ellerth affirmative defense is available to employers under state law. Still, at least two appellate courts appear willing to impose strict liability when the harasser is a highlevel manager (even in the absence of any tangible employment action).

City Law

Finally, the New York City Human Rights Law is the easiest of the antidiscrimination laws for establishing employer liability. The city law expressly states that employers shall be liable for the unlawful discriminatory practices committed by "managerial or supervisory personnel." Thus, there is no need to demonstrate a tangible employment action to establish an employer's strict liability for supervisory harassment under city law. Simply stated, if a supervisor is guilty of harassment, so too is the employer.

One Federal court has recently held that employers may not avoid liability, under city law, by invoking the Faragher-Ellerth affirmative defense because of the city law's strict liability standard for "managerial and supervisory personnel." As for co-worker harassment, city law provides that an employer is liable if it knows, or reasonably should know, of the harassment and acquiesces to the harassment or fails to take immediate or appropriate corrective action.

James A. Brown is a partner in the law firm Brown & Gropper, LLP. He can be reached at (212) 366-4600 and at jabrownlaw@aol.com.