US Supreme Court: Who Is a Supervisor for Determining Title VII Liability Standards?

Under Title VII of the Civil Rights Act of 1964, the law regards harassment by a supervisor as different from harassment by a co-worker.  The employer is liable for harassment by a co-worker if the employer is negligent: the employer knew or should have known of the harassment and failed to take appropriate corrective action.  That is true as well in California under the Fair Employment and Housing Act.

For supervisor harassment, though, the employer is "strictly liable" - regardless of what it knew or should have known, and regardless of what action it takes - if the harassment includes a "tangible employment action" such as firing, demotion, loss of pay.  But if there is no tangible employment action, the employer may escape liability by proving that the employer exercised reasonable care to prevent harassment and the harassment victim did not take advantage of the employer's preventive or corrective opportunities.  That is known as the "Faragher-Ellerth" defense.  

Under California law, there is no escape from liability.  Employers are strictly liable for supervisor harassment, regardless of whether there is a tangible employment action. The employer may assert as a defense, though, that the employee's damages should be reduced because of the employee's failure to avail herself of opportunities to avoid the harassment (avoidable consequences defense.)

So, the issue of who is a supervisor matters under both schemes.  California law defines supervisor in its statute (Govt. Code Section 12926(s): "'Supervisor' means any individual having the authority, in the interest of the employer, to hire, transfer, suspend, layoff, recall, promote, discharge, assign, reward, or discipline other employees, or the responsibility to direct them, or to adjust their grievances, or effectively to recommend that action, if, in connection with the foregoing, the exercise of that authority is not of a merely routine or clerical nature, but requires the use of independent judgment."

Title VII does not define supervisor.  Some lower courts said that supervisors had to have the power to take tangible actions like firing, reassignment, etc.  The EEOC said supervisors merely have to have the power to direct the victim's work. Enter the Supreme Court.

Maetta Vance worked for Ball State University as a server in the catering department.  She complained that a co-worker, Saundra Davis, was her supervisor and harassed her over a period of time on the basis of her race.  Davis was a catering specialist, but she had no power to hire, fire, promote, demote, etc. Vance.  The lower courts threw out Vance's harassment claim because they found that Davis was not a supervisor and that Ball State was not negligent.

After reviewing precedent and the different supervisor formulations, the Court 5-4 decided

We hold 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.” Ellerth, supra, at 761. We reject the nebulous definition of a “supervisor” advocated in the EEOC Guidance and substantially adopted by several courts of appeals.

It is unclear whether this decision will affect California law.  As stated above, California has a statutory definition of "supervisor."  In fact, that definition is taken from the National Labor Relations Act, Section 2(11).  And the majority in the Vance case said the NLRA definition was too broad and did not apply to Title VII harassment cases.  So, it appears that California's supervisor definition is broader than  the Court's definition in Vance.

In dissent, Justice Ginsburg, writing for four, argued that the majority's definition is too narrow and that Congress should define supervisor.

This case is Vance v. Ball St. University and the opinion is here.

Court of Appeal: Let Jury Decide Co-Worker Harassment Case

The Court of Appeal issued a "writ" of mandate, overturning a summary judgment order on a harassment claim.  Mustafa Rehmani worked for Ericsson in Silicon Valley.  He is Pakistani. Many of his co-workers are Indian. Rehmani claimed the Indian co-workers gave him a rough ride.  The court describes a series of incidents, over a few months, in which there were political jokes, terrorism jokes, and the like.  However, these jokes were pretty isolated, occurring about a month apart. 

The court decided that the allegations were enough to send the case to a jury and that the trial court should not have granted summary judgment.  The court also held that the company's management had sufficient notice of the conduct, and there was insufficient evidence of an adequate response to the conduct to justify summary resolution.

If you believe the plaintiff's version of events (which the court had to do), he told his manager repeatedly about his co-workers' anti-Pakistani / anti-Muslim jokes.  But she brushed them off.  So, a very thin case of national origin harassment will go to a jury, or a mediator.  A little management training (or better training) could have helped here.

The case is Rehmani v. Superior Court and the opinion is here.

Court of Appeal: No Attorney-Client Privilege for Employee's Emails to Lawyer

Gina Holmes worked for Petrovich Development Co. LLC as assistant to the CEO, Paul Petrovich.  She was pregnant early in her employment and got into a discussion with her boss about the length of her leave and their respective feelings about her pregnancy. Although it appeared that they had cleared the air, Holmes simultaneously attempted to hire a lawyer, via email at work. Apparently, Holmes became upset that Petrovich forwarded her emails to others in the organization and quit, claiming constructive discharge, discrimination, harassment, etc.

The trial court summarily dismissed the harassment, discrimination and retaliation claims. The court of appeal affirmed - holding that the harassment evidence was limited to email correspondence that was neither severe nor pervasive.

The court of appeal also affirmed dismissal of the claim that Holmes was forced to resign. The court noted that when a plaintiff cannot establish a hostile work environment, a constructive discharge claim is a higher standard and must also fail.  Holmes' retaliation claim failed too, because of the lack of an adverse action.

That left claims for intentional infliction of emotional distress and invasion of privacy, which were tried to a jury. The jury found for the defendants. On appeal, Holmes claimed the trial court should not have allowed Petrovich to use the emails she sent to a lawyer seeking a referral, in which she explained her situation.  The trial court held that Holmes waived the privilege because she used company email, and there were clear policies explaining the company's right to monitor email.

The court of appeal agreed that Holmes waived the privilege Here is the money quote:

Although a communication between persons in an attorney-client relationship "does not lose its privileged character for the sole reason that it is communicated by electronic means or because persons involved in the delivery, facilitation, or storage of electronic communication may have access to the content of the communication" (§ 917, subd. (b)), this does not mean that an electronic communication is privileged (1) when the electronic means used belongs to the defendant; (2) the defendant has advised the plaintiff that communications using electronic means are not private, may be monitored, and may be used only for business purposes; and (3) the plaintiff is aware of and agrees to these conditions. A communication under these circumstances is not a “„confidential communication between client and lawyer‟” within the meaning of section 952 because it is not transmitted “by a means which, so far as the client is aware, discloses the information to no third persons other than those who are present to further the interest of the client in the consultation . . . .” (Ibid.)


When Holmes e-mailed her attorney, she did not use her home computer to which some unknown persons involved in the delivery, facilitation, or storage may have access. Had she done so, that would have been a privileged communication unless Holmes allowed others to have access to her e-mails and disclosed their content. Instead, she used defendants‟ computer, after being expressly advised this was a means that was not private and was accessible by Petrovich, the very person about whom Holmes contacted her lawyer and whom Holmes sued. This is akin to consulting her attorney in one of defendants‟ conference rooms, in a loud voice, with the door open, yet unreasonably expecting that the conversation overheard by Petrovich would be privileged.

Lawyers for employees obviously should take note and advise employees not to use monitored email systems. Employers should ensure their email policies are comprehensive and clear regarding employees' expectations of privacy.

The case is Holmes v. Petrovich Development Company LLC and the opinion is here.

Court of Appeal: No Attorney Present at Plaintiff's Mental Examination

The court of appeal's opinion in Toyota v. Superior Court should be interesting to employment lawyers and maybe to their clients involved in employment litigation.
Steven Braun was a plaintiff in a discrimination and harassment case against Toyota. He claimed significant emotional distress as a result of the conduct. Toyota arranged for a mental examination. Braun's attorney sought to impose certain conditions, including that it be taped, and that the attorney could accompany Braun to the exam and wait in an adjoining room. The doctor balked at this condition, as did Toyota. The Superior Court, however, allowed it. So, Toyota sought a "writ" - a mid-litigation appeal - overturning the Superior Court's decision.

The Court of Appeal granted the writ, which almost never happens in discovery disputes. The court said that although an attorney is not always prohibited from attending an examination, he or she must make some evidentiary showing of need. Toyota, on the other hand, showed (1) that the examination's scope was limited by court order (2) that the doctors believed the attorney's presence could influence the examination. The court also noted that medical professionals conducting such examinations are entitled to a presumption they will act properly.

The case is Toyota v. Superior Court and the opinion is here.

California Supreme Court Takes on Harassment v. Discrimination

Roby sued McKesson for disability-based harassment and discrimination. The jury awarded over $3million in actual and $15million in punitive damages, including an award of damages for harassment against an individual defendant. The verdict, though, was a mess and was reduced because of overlapping, duplicative damages awards. In addition, there was an issue of whether the individual could be sued for harassment because much of the alleged conduct was in connection with personnel decisions.

One of the issues the Supreme Court addressed is whether a manager / supervisor's conduct during "personnel actions" is evidence not only of the discriminatory motive, but also harassment. The court explained the difference as follows: "discrimination refers to bias in the exercise of official actions on behalf of the employer, and harassment refers to bias that is expressed or communicated through interpersonal relations in the workplace. " * * *
"[H]arassment is generally concerned with the message conveyed to an employee, and therefore with the social environment of the workplace, whereas discrimination is concerned with explicit changes in the terms or conditions of employment"

Applying this standard, the court upheld Roby's harassment claim:

Roby's discrimination claim sought compensation for official employment actions that were motivated by improper bias. These discriminatory actions included not only the termination itself but also official employment actions that preceded the termination, such as the progressive disciplinary warnings and the decision to assign Roby to answer the office telephones during office parties. Roby's harassment claim, by contrast, sought compensation for hostile social interactions in the workplace that affected the workplace environment because of the offensive message they conveyed to Roby. These harassing actions included Schoener's demeaning comments to Roby about her body odor n10 and arm sores, Schoener's refusal to respond [*40] to Roby's greetings, Schoener's demeaning facial expressions and gestures toward Roby, and Schoener's disparate treatment of Roby in handing out small gifts. None of these events can fairly be characterized as an official employment action. None involved Schoener's exercising the authority that McKesson had delegated to her so as to cause McKesson, in its corporate capacity, to take some action with respect to Roby. Rather, these were events that were unrelated to Schoener's managerial role,
engaged in for her own purposes.

Does this clear things up? There was a bright line between personnel actions and harassing conduct before this case, supported by 15 years of authority. Does this mean that personnel actions now are evidence of harassment when the manager carrying them out is unpleasant? We will see how lower courts treat evidence of harassment after this decision.

Separately - the Court also analyzed punitive damages in employment law cases. After detailed analysis, the Court decided that a one-to-one ratio between actual and punitive damages was the constitutional limit. The Court based its conclusion on its conclusion that as a corporation, McKesson's conduct was not particularly "reprehensible." The Court also based its decision on the high damages award, warranting a lower ratio because of the actual damages' deterrence of similar conduct.

The Court also explained what a "managing agent" is for punitive damages purposes, clarifying prior rulings:

In this case, the Court of Appeal concluded that the jury could reasonably have found supervisor Schoener to be a "managing agent" of employer McKesson. On that basis, the court concluded that the jury's award of punitive damages could be justified based on Schoener's actions alone, regardless of whether more senior managers at McKesson were informed of Schoener's actions. We disagree.

At the time of Roby's termination, McKesson had over 20,000 employees; Schoener
worked at a local distribution center supervising four of them. When we spoke in White about persons having "discretionary authority over . . . corporate policy"
(White, supra, 21 Cal.4th at p. 577), we were referring to formal policies that affect a substantial portion of the company and that are the type likely to come to the attention of corporate leadership. It is this sort of broad authority that justifies punishing an entire company for an otherwise isolated act of oppression, {Slip Opn. Page 32} fraud, or malice. The record here does not support the conclusion that Schoener exercised that sort of broad authority or that she was a "managing agent" for purposes of awarding punitive damages under Civil Code section 3294, subdivision (b). Therefore, in assessing the reprehensibility of employer McKesson's conduct, we must look to what McKesson's more senior managers knew and did.

The case is Roby v. McKesson Corp. and the opinion is here.

No Workers' Compensation Benefits for Mean Employee

So Verga is a United Airlines employee. She is tough on her co-workers. They resent it and are mean to her. Verga files a workers' compensation claim for "stress" caused by the co-workers' "disdain." The Court of Appeal, agreeing with the Workers' Compensation Appeals Board, held: "No benefits for you!"

Here is the gist of it:

The Workers’ Compensation Appeals Board (the WCAB) concluded that Rosemary
Verga was not entitled to compensation for psychiatric injury while employed by United Airlines. According to Verga, her psychiatric injury was the result of harassment and persecution by her supervisor and co-workers. However, the WCAB found “the true fact remains that [Verga] was not actually subject to harassment or persecution, she instead brought upon herself the disdain of her co-workers” because Verga was “a difficult person to get along with”; she was impolite, unpleasant, and co-workers “never knew when [she] might get upset.” The WCAB held: “That disdain is not an actual event of employment” within the meaning of the statute. [par.] We issued a writ of review and shall now affirm the WCAB order.

The case is Verga v. WCAB and the opinion is here.