A Victory for Employers: The Supreme Court Narrows Employer Vicarious Liability Under Title VII

Introduction

On June 24, 2013, the US Supreme Court issued a decision in Vance v. Ball State University, No. 11-556, holding that an employee is a “supervisor” for purposes of vicarious liability under Title VII only if he or she is empowered by the employer to take tangible employment actions against the victim. Vance v. Ball State University, No. 11-556 (June 24, 2013).

Facts

Maetta Vance (Vance) began working for University Dining Services at Ball State University (BSU) in 1989 as a substitute server. She was the only African-American working in the department. Vance submitted a complaint to BSU when Saundra Davis (Davis), a white coworker, allegedly used a racial epithet directed at her and African-American students at BSU. Davis did not have the authority to hire, fire, demote, promote, transfer, or discipline Vance.

BSU issued Davis a written warning. Following a series of incidents that resulted in Vance reporting that she felt unsafe in her workplace, BSU investigated but found no basis for any remedial action. On October 3, 2006, Vance sued BSU in federal district court for lessening her work duties and her ability to work overtime, forcing her to work through breaks, and unjustly disciplining her. She also alleged that BSU had created a racially hostile work environment in violation of Title VII. After filing the suit, Vance claimed her work environment continued to worsen, but the University’s investigations did not yield enough evidence to discipline anyone.

BSU moved for summary judgment. The district court granted the motion and held that there was not enough evidence to prove a hostile work environment and that the University was not liable for the actions of individual coworkers. The court explained that BSU could not be held vicariously liable for Davis’ alleged racial harassment because Davis could not “hire, fire, demote, promote, transfer, or discipline” Vance and, as a result, was not Vance’s supervisor under the Seventh Circuit’s interpretation of that concept. The court further held that BSU could not be liable in negligence because it responded reasonably to the incidents of which it was aware. Vance appealed, and the US Court of Appeals for the Seventh Circuit affirmed the judgment of the lower court.

The Supreme Court’s Decision

Vance filed a writ of certiorari to the Supreme Court, posing the following: Whether the “supervisor” liability rule established by Faragher v. City of Boca Raton and Burlington Industries, Inc. v. Ellerth (i) applies to harassment by those whom the employer vests with authority to direct and oversee their victim’s daily work, or (ii) is limited to those harassers who have the power to “hire, fire, demote, promote, transfer, or discipline” their victim.

The Supreme Court, in a 5-4 decision written by Justice Samuel Alito, held 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.”

In so holding, the Court rejected the EEOC’s Enforcement Guidance definition of supervisor, which ties such status to the ability to “exercise significant direction over another’s daily work.” The Court opined that under the approach advocated by Vance and the EEOC, supervisor status would very often be murky and too vague. The Court’s definition, however, offers clarity to litigants. The Court reasoned as follows:

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.

The Court rejected the dissents’ contention that the opinion’s holding will preclude employer liability in other cases with similar facts. Assuming that a harasser is not a supervisor, the Court explained, a plaintiff could still prevail by showing that the employer was negligent in failing to prevent harassment from taking place. Evidence that an employer did not monitor the workplace, failed to respond to complaints, failed to provide a system for registering complaints, or effectively discouraged complaints from being filed would be relevant. Thus, the Court wrote, “it is not true, as the dissent asserts, that our holding ‘relieves scores of employers of responsibility’ for the behavior of workers they employ.”

Applying the above definition of supervisor, the Court held that, because there was no evidence that BSU empowered Davis to take any tangible employment actions against Vance, the judgment of the Seventh Circuit should be affirmed.

The Dissent

The dissent, written by Justice Ruth Bader Ginsburg, took issue with the Court’s definition of supervisor because it “strikes from the supervisory category employees 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.” The dissent would have adopted the EEOC’s Guidance definition of supervisor, which counts as a supervisor anyone with authority to take tangible employ­ment actions or to direct an employee’s daily work activities.

Conclusion

The Supreme Court’s narrow definition of supervisor in this context is certainly a win for employers. However, as the majority specifically noted, employers may still be held liable for failing to monitor the workplace or respond to complaints, among other theories. In addition, some state, county and city human rights laws apply a broader definition of “supervisor” in this context.  The Arent Fox Labor & Employment group will continue to monitor developments in this area as they occur.