Greenberg Traurig Alert
Sexual Harassment Liability: New Rules Affect Employers
By Ronald M. Rosengarten and Jennifer Demberg, Greenberg Traurig, Miami Office
View or download the PDF version of this Alert here.
On June 26, 1998, the United States Supreme Court issued two important decisions in the
area of sexual harassment, Burlington Industries v. Ellerth and Faragher v. City
of Boca Raton. These cases make it important for all employers to understand the new
rules under which they will be deemed liable for the actions of a supervisor accused of
sexual harassment, and how they can take preventative measures to avoid liability.
In Burlington Industries v. Ellerth, Kimberly Ellerth, a salesperson, claimed
she was subjected to constant sexual harassment by a mid-level manager who made offensive
remarks and gestures, as well as comments that could be construed as threats to retaliate
against her if she denied some sexual liberties. Ellerth did not complain about the
managers conduct to anyone in authority, even though she knew that the Company did
have a policy against sexual harassment. She quit after her immediate supervisor cautioned
her about her job performance. Three weeks later, she sent a letter explaining that she
quit because of the managers behavior.
In Faragher v. City of Boca Raton, Beth Ann Faragher, a lifeguard, claimed that
her supervisor created a sexually hostile atmosphere, which included uninvited and
offensive touching, lewd remarks, and speaking of women in offensive terms. Faragher
complained to another supervisor about this conduct, but that information was not passed
on to the City. Although the City had a policy against sexual harassment, it was not
distributed to beach employees.
Through these two cases, the Court established the following principles:
(1) If both of the following conditions exist, an employer will be subject to
"vicarious" liability (that is, indirect liability) for the actions of a
supervisor: (i) the supervisor has created a hostile environment for an employee (that is,
sexual harassment that is sufficiently severe and/or pervasive), and (ii) the
supervisor has taken some tangible employment action against the employee. Tangible
actions include hiring, firing, failure to promote, reassignment with significantly
different responsibilities, or a decision causing significant change in benefits.
(2) If a supervisor has created a legally hostile environment, but has not taken
a tangible employment action against an employee, then the employer has the chance to
avoid liability if the employer shows that it meets both of the following tests:
(i) the employer exercised reasonable care to prevent and correct promptly any sexually
harassing behavior; and (ii) the employee unreasonably failed to take advantage of
procedures or corrective opportunities provided by the employer or to avoid harm
In effect, these Supreme Court cases have created a greater risk of employer liability
once a supervisor has caused a hostile work environment. It does not matter whether the
employer "knew or should have known" what the supervisor was doing; the Supreme
Court essentially has imposed liability on the employer in cases where some tangible
employment action was taken by the supervisor. Even where no tangible action was taken, an
employer still will bear the burden of proving its defenses in order to escape liability
once the hostile work environment has been established.
The new Supreme Court rulings reinforce that the best way for employers to avoid
liability for a hostile work environment is to make sure well in advance that a sexual
harassment policy is in place, that it is communicated effectively to all employees, and
that there is an accessible and workable procedure for employees to register complaints.
Furthermore, as soon as employees complain of misconduct, employers must take quick steps
to investigate and stop any misconduct. Employees trained as to their rights with respect
to sexual harassment are more likely to register a complaint before any adverse
employment action is taken. Greenberg Traurig will continue to help its clients develop
sound policies against sexual harassment and procedures to deal with complaints, and we
remain ready to advise employers on how to respond to specific complaints of sexual
harassment once they are received.
This GT ALERT is issued for informational purposes only and is not intended
to be construed or used as general legal advice. Greenberg Traurig attorneys provide
practical, result-oriented strategies and solutions tailored to meet our clients’
individual legal needs.