Fourth Circuit Holds Employer Liable for Third Party Harassment

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Joining a growing list of courts upholding employee claims of third party (non-employee) harassment, the Fourth Circuit Court of Appeals recently decided that a negligence standard applies to employers who were aware of should have been aware of the harassment and failed to take prompt action to end it. It is important to note that while the United States Supreme Court has not yet addressed the issue, the Fourth Circuit joins five other circuit courts of appeals in finding that a negligence standard applies to employers when there is a third party harassment claim under Title VII. This is an impressive and wide group of appellate courts and likely guarantees that any ensuing caselaw in the remaining circuits will no doubt take the same position.

What this drills down to is that if you, the employer, knew or should have known of the harassment, and failed to take quick corrective measures reasonably calculated to end the harassment, liability can be imputed to you, the employer. Third parties can be almost anyone, including customers, salespeople, vendors and suppliers.

Employers should minimize their risk by doing the following:

Review your policy. Review harassment policies to ensure they cover employee complaints of harassment by third parties. These policies should contain clearly articulated procedures for investigating complaints.
Investigate complaints of harassment promptly and thoroughly. Employers must be quick to investigate harassment complaints. While there is no hard and fast rule for the amount of time legally allotted here, a prudent rule of thumb is to initiate an investigation on receipt so nothing slips through the cracks.
Train your managers. Employers should conduct regular training to ensure that supervisory staff are familiar with your policies, and know the proper procedures to follow to address claims once made. Supervisors should also be vigilant to potential problems to minimize situations before they arise if possible.
Enforce your policy. Sounds like a no-brainer, but a surprising amount of companies adhere to the ostrich rule of putting their heads in the sand and attempting to ignore potentially explosive situations. Policies are only as good as their enforcement process.

Finally, employers should be aware that taking a corrective action when being made aware of potential harassment must be “reasonably likely to prevent future harassment”; thus, simply attempting to separate the harassing customer or other third party from the employee may not be sufficient, especially if the two continue to interact with one another. Further corrective actions will be necessary.

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Posted In: Legal