The basis of an employer’s liability for a claim of hostile work environment under Title VII depends upon whether the harasser is the complainant’s supervisor or merely a co-worker.  When a hostile work environment is created by a co-worker, the employer is liable only if the employer failed to provide an avenue for reporting the harassment, or if the employer knew or should have known of the harassment but failed to take prompt and appropriate remedial action.  Under Title VII, an employer “knew or should have known” about workplace harassment if “management level employees had actual or constructive knowledge about the existence of a sexually hostile environment.”  Therefore, once a management level employee has enough information to raise the probability of sexual harassment in the mind of a reasonable employer, the employer is deemed to be on constructive notice of that harassment.

Recently, the 3d U.S. Circuit Court of Appeals affirmed summary judgment in favor of an employer, holding that the individual team leaders who were aware of certain harassing behavior were not the “management level personnel” referred to in Title VII and, therefore, that the employer could not be held liable for the claims of harassment made by the plaintiff.  Huston v. Proctor & Gamble Paper Products Corp., 3d Circ., No. 07-2799, June 30, 2009.

Priscilla Huston was employed by Proctor & Gamble’s Mehoopany, Pennsylvania plant for more than 10 years, working as a technician on teams that operated large paper manufacturing machines.  In 2004, Huston allegedly heard about a number of instances in which certain of her male team members exposed themselves to other male employees.  She reported those specific incidents only to her team’s “process coach” (Romanchick) and a “machine leader” (Traver), but not to senior management.  Huston alleges that she subsequently witnessed two similar incidents herself.  She reported those two incidents to a senior-level manager and a human resource manager.  An investigation was begun on the day that the incidents were reported.  Discipline ultimately was imposed to all team members, including Huston, after it was discovered that the entire team used vulgar language at work – a practice that the company had been working to eliminate.  Although Huston’s disciplinary history was such that she could have been terminated for this infraction, she was simply asked to be “mindful of her language” at work.

In the fall of 2004, P&G identified a costly problem occurring at the plant, and was able to trace the problem to a lack of care on the part of the technicians, including Huston.  At that point, all technicians were informed that they risked termination if caught fabricating data for machine data logs.  In spite of this warning, Huston admittedly falsified certain data into the logs, and was terminated from employment.  She then filed a complaint asserting a sexually hostile environment, claiming that Romanchick and Travers were “managers” who put the company on notice of the plant’s hostile environment, and that the company should have acted sooner with respect to the hostile environment.

The Third Circuit affirmed a lower court’s dismissal of the case, finding that Romanchick and Travers did not qualify as management-level employees for purposes of Title VII and, therefore, that the company was not on notice of the hostile environment until Huston reported it to senior management.  Unlike salaried managers, Romanchick and Travers were paid on an hourly basis, and had no actual authority to hire, fire, or discipline others.  Instead, they performed essentially the same functions as the remaining team members, with certain additional oversight functions.  According to the Court, an employee’s knowledge of sexual harassment may be imputed to the employer only when (1) that employee is sufficiently senior in the employer’s governing hierarchy so that such knowledge is important to that person’s general managerial duties; or (2) the employee is specifically employed to report or respond to sexual harassment.

This case provides a bright line definition of “managerial employee” with respect to Title VII’s use of that term by requiring knowledge of a hostile environment to reach an employee in the “governing body” of the company, as opposed to a mere “supervisory employee in the labor force.” According to the Court, “[a]lthough an employer has a duty to be reasonably diligent in attempting to discover co-worker harassment, an employer is not expected to know every instance of harassment that may occur between co-workers.”  While this should not be read as permission to ignore or minimize instances of harassment that come to light, it allows employers to fully understand their duty under Title VII, and to respond effectively when allegations of sexual harassment are properly raised.


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