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Oct 08, 2018

Vicarious Liability for Unlawful Harrassment

By: Allison Mann

One of my favorite shows to watch and rewatch is the popular NBC comedy The Office. The show follows the employees of the Scranton branch of Dunder Mifflin—a paper company. This sitcom brings us an iconic character—Michael Scott. Michael is the manager of the Scranton branch of Dunder Mifflin. His hijinks entertained audiences, and were the focus of the show for multiple seasons. However, Michael may have been an employer’s worst nightmare as a manager. Some of his “greatest hits” of terrible decisions include fake firing an employee, making inappropriate sexual jokes in the office, hitting an employee with his car on company property, and kissing another employee to prove that he is not homophobic. Much of his behavior could be perceived as harassment.

The Law:

An employer can be held legally responsible for the actions of its supervisory employees. This is called vicarious liability. It has been made clear that an employer can be subject to vicarious liability for unlawful harassment by a supervisor. However, there are some instances where an employer can protect themselves from such responsibility.

First, the general rule is that an employer will always be held vicariously liable where the unlawful harassment resulted in a “tangible employment action” against the employee. A tangible employment action is a significant change in employment status. So, examples include termination, failure to promote, demotion, reassignment, or change in compensation or benefits.

An employer has an affirmative defense against vicarious liability where it can show that the harassment did not result in a tangible employment action. To utilize this defense, the employer must show (1) that it exercised reasonable care to prevent and correct any harassing behavior; and (2) that the employee unreasonably failed to take advantage of any preemptive or corrective opportunities provided by the employer or to otherwise avoid harm. If these can be proven, the employer will avoid all liability for the harassment.

The Takeaway:

In the show, there was very little consequence for Michael’s ill-advised actions, though Dunder Mifflin did take some action. We see the entire office participating in sensitivity training, and in one episode, we can see that Oscar received a settlement from the company for Michael’s actions.

There are many different avenues for an employer to take in order to prevent unlawful harassment in the workplace, and to insulate itself from potential vicarious liability. Preservation of the affirmative defense discussed above is crucial. The standard here is going to be that the employer exercised reasonable care. Steps to preserve this defense include:

    • Drafting and disseminating an anti-harassment policy;
    • Implementing a complaint procedure;
    • Conducting an effective investigation whenever a complaint is made;
    • Protecting employee confidentiality to the extent possible under the circumstances;
    • Taking appropriate corrective action; and
    • Protecting against retaliation.
Oftentimes it comes down to the timeliness and the effectiveness of the employer’s response in cases of harassment. Having a system in place to identify and address these issues is crucial.

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Reprinted with permission from an article submitted for publication in the October, 2018 Southwest Area Human Resource Association newsletter.