In a close 5-4 decision issued on June 24, the U.S. Supreme Court resolved a seemingly simple question that has far-reaching implications for employers.
In Vance v. Ball State University, 570 U.S. ___ (2013), a narrow majority of the Court decided that the definition of “supervisor” should be limited for purposes of harassment liability under Title VII of the Civil Rights Act. Under Title VII, it is unlawful for an employer to discriminate against (or harass) any individual on the basis of race, color, religion, sex, or national origin. Further, under 1998 Supreme Court decisions Faragher v. Boca Raton and Burlington Industries, Inc. v. Ellerth, employers can be held vicariously (strictly) liable for harassment committed by “supervisors”, where that harassment results in “tangible employment action” against an employee (such as reassignment, failure to promote, ). If the harasser was not a “supervisor”, the employer is only liable for the harassment if the employer failed to exercise reasonable care in preventing and correcting workplace harassing behavior.
While other terms that arose from the Faragher and Ellerth cases are clear, the word “supervisor” has remained undefined. Circuit courts of appeals have been split as to what definition should apply. The Court considered two options:
Option A: a person qualifies as a “supervisor” by directing and overseeing an employee’s day-to-day activities. This option was the definition of choice of the 2nd, 4th and 9th Circuits, as well as the EEOC (Equal Employment Opportunity Commission)..
Option B: a “supervisor” directs and oversees the employee’s day-to-day activities, and is empowered to “hire, fire, demote, promote, transfer, or discipline” the employee. This option was favored by the 1st, 7th and 8th Circuits.
The Court favored Option B. It felt that Option A was too “nebulous”; by contrast, Option B could be “readily applied” (often before litigation commences), making it possible to resolve harassment disputes before filing suit (or at least before reaching the trial phase).
The Vance decision is very good for employers, as it narrows the scope of strict liability to harassment engaged in by those who can themselves take “tangible employment actions” against the employee. Those without that power do not qualify.
But this does not mean employers should rest on their laurels. It is important for employers to be aware of who among their managerial staff qualify as “supervisors” for purposes of Title VII liability. All employees should be trained in recognizing and preventing harassment. Even those who are not in a “supervisor” position can create liability if they do not properly handle a complaint, as failure to properly investigate or correct the situation can result in a finding of negligence on the part of the employer and liability for damages.