The Supreme Court Speaks: Title VII “Supervisors” Must Have The Power To Implement Tangible Employment Actions

In Vance v. Ball State University, in a 5-4 decision issued June 24, 2013, on the same day and by the same majority that decided the Nassar case limiting Title VII retaliation claims to “but for” violations, the U.S. Supreme Court handed employers another victory by defining, precisely and narrowly, who is a “supervisor” for liability purposes in cases of Title VII unlawful harassment.

Under Title VII, employer liability for harassment varies based on the supervisory status of the harasser. If the alleged harasser is the target’s co-worker, the employer is liable if it was negligent in controlling the work environment.  When the alleged harasser is a “supervisor,” however, there are different, and more significant, rules in place.  If a supervisor’s harassment results in a tangible employment action, such as a termination, demotion, or loss of pay for the targeted employee, the employer will be automatically liable for the harassment, and the employer has no available defense.

When there is no tangible employment action involved, however, and the issue is whether the supervisory harasser has created a hostile work environment, an employer may avoid liability under Title VII if it can prove the now, well-known Faragher/Ellerth affirmative defense, which requires proof that: (1) the employer exercised reasonable care to prevent and correct any harassing behavior; and (2) the plaintiff unrea­sonably failed to take advantage of the preventive or corrective opportunities that the employer provided.

In light of these varying liability standards, whether the harasser is a “supervisor” is a critical issue, and one that has been left to the courts and juries to decide with little concrete direction and inconsistent results.  Now, the Supreme Court has provided much needed guidance and ruled that an individual is only a “supervisor” for purposes of vicarious liability when he or she has the power to significantly change the employment status of the plaintiff, which means the power to hire, fire, deny a promotion, reassign with significantly different responsibilities, or implement a decision causing a significant change in benefits.  The Supreme Court specifically rejected the broader definition of “supervisor” that the EEOC and several courts of appeals had adopted that included employees authorized to direct another employee’s daily work activities.

Therefore, in cases where the employer is automatically liable because a supervisor was the harasser, that vicarious liability will only be in play where the supervisor at issue was actually in a position to affect the plaintiff’s terms and conditions of employment.  The majority took the time to explain why it was drawing this bright line to aid parties embroiled in harassment litigation:  “The interpretation of the concept of a supervisor that we adopt today is one that can be readily applied.  In a great many cases, it will be known even before litigation is commenced whether an alleged harasser was a supervisor, and in others, the alleged harasser’s status will become clear to both sides after discovery.  And once this is known, the parties will be in a position to assess the strength of a case and to explore the possibility of resolving the dispute.  Where this does not occur, supervisor status will generally be capable of resolution at summary judgment.”  Lawyers and judges will be better positioned to prevent a case from getting to a jury that does not belong.

Employers should review organizational charts, job descriptions and other documents and systems defining supervisory chains of authority and responsibility.  Those individuals who are, indeed, able to effect a “significant change in employment status” should be clearly identified, which would include the supervisors with the express authority to hire, fire, demote, or reassign employees.  Similarly, employers should identify which supervisors do not have that authority.

While the narrower definition of supervisor is welcome news for employers in the litigation process, the Supreme Court warned against attempts by employers to insulate from liability by vesting in only a small group the decision-making authority as to other individuals.  The Court quickly recognized that such a group would very likely be relying on input from other co-workers who actually interact with the employees, which may result in the employer having delegating the power to take tangible employment actions to those workers who interact with the employees.  Of course, employers must continue to maintain compliance with workplace training, adopting anti-discrimination and harassment policies, and having a viable and accessible internal complaint process in place to address harassment concerns.

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