Establishing liability for discrimination or harassment by a supervisor

New California laws establish training requirements for supervisors in issues of discrimination and harassment

2016 June

With the many changes in the law on the subject of employee rights and protection, whether they are due to issues of gender identity, sexual orientation, or religion, among other things, one issue remains a constant controversy and sometimes confusion: when can you get individual supervisor liability?

Recent training requirements adopted by the legislature regarding the failure to train supervisors properly in dealing with issues of discrimination and harassment in the workplace can now not only enhance the liability of the employer, but can demonstrate clearly the individual liability of supervisors.

Who is a supervisor?

Federal and state discrimination laws differ in their definition of supervisor for liability purposes, but for those who practice in California and seek to apply California anti-discrimination law, the Fair Employment and Housing Act, and precedential cases applying FEHA, provide a clear path to understanding the world of supervisors in this area of law. Additionally, the required training companies are to provide supervisory employees provides further clarity on obligations.

When it comes to interactions with the company’s own employees – which form the basis of claims under the Fair Employment and Housing Act (Cal. Gov. Code, §§ 12940, et seq.) – supervisors may be considered “employers,” thereby subjecting the company, and possibly even themselves individually, to statutory liability whether or not the company itself ratified the acts of said supervisor.

The Fair Employment and Housing Act prohibits (among other things) discrimination, harassment and retaliation by “employers” in the workplace (See Cal. Gov. Code, §§ 12940(a) [discrimination], 12940(h) [retaliation] and 12940(j)(1) [harassment]; see also (Roby v. McKesson Corp. (2009) 47 Cal.4th 686, 705); (Miller v. Department of Corrections (2005) 36 Cal.4th 446.)

Under Government Code section 12940, the term “supervisor” or “supervisors,” is defined in keeping with both federal and state case law, which treats supervisors differently than other employees in matters of civil rights and discrimination in the workplace. The United States Supreme Court has defined a supervisor as an employee empowered by the employer “to take tangible employment actions …[and] a significant change in employment status [against fellow employees] such as hiring, firing, failing to promote, reassignment with significantly different responsibilities or a decision causing a significant change in benefits.” (Vance v. Ball State (2013) 133 S.Ct. 2434, 2443.) Due to the position of authority over an employee a supervisor invariably holds, courts, and FEHA, have classified a supervisor as an agent of the employer for purposes of attaching liability. (Janken v. GM Hughes Electronics (1996) 46 Cal.App.4th 55); (See Roby, 47 Cal.4th at 686.) Thus, depending on the theory of recovery triggered by their actions, the supervisors may even be directly and individually responsible to the plaintiff under FEHA.

Is a supervisor responsible for discrimination, harassment and retaliation?¹

Government Code section 12940(a) bars discrimination in the workplace on the basis of gender, race, religion, sexual orientation, gender expression, medical condition, military and veteran status, disability and age. Courts have interpreted this mandate to potentially involve the performance of commonly necessary personnel actions and other management duties such as hiring, firing, promotion and compensation, which may be found to be discriminatory if based on improper motives. (See Janken v. GM Hughes Electronics, 46 Cal.App.4th at 64.) As a matter of public policy, however, individual supervisors are not liable to plaintiffs for discrimination under FEHA in carrying out the policies of the employer. (Reno v. Baird (1998) 18 Cal.4th 640, 655.)

Retaliation under FEHA, governed by section 12940(h)², is another claim for which the California Supreme Court has ruled that supervisors are not individually liable. As explained, as retaliation is based on what is generally a corporate decision, potentially made collectively by a number of persons, individual responsibility is considered unfair and unwarranted. (See Jones v. Lodge at Torrey Pines Partnership (2008) 42 Cal.4th 1158.)

In this sense, discrimination and retaliation – as defined and governed by the code – are treated similarly by the courts as an expression of corporate policy as opposed to individual bad acts.

Harassment, on the other hand, is a much different story. It is defined to potentially include “slurs or derogatory drawings, [physical interference] with freedom of movement… [or] unwanted sexual advances.” (See Cal. Gov. Code, § 12940(j)); (Reno v. Baird, supra, 18 Cal.4th at 646.) None of these types of actions are necessary to the management of personnel for the benefit of an employer. As such, a supervisor acting in the course and scope of his or her employment when the harassment occurs may be held personally liable. (Myers v. Trendwest Resorts Inc. (2007) 148 Cal.App.4th 1403.) (Gov. Code, § 12940(j)(1), 12940(j)(3).) The employers are equally strictly liable for the supervisor’s harassment of their fellow employees.

However, if the harassing employee is a non-supervisor, the only way to hold the employer responsible is to show that the employer knew or should have known of the harassment and failed to take immediate and appropriate corrective action. (See Cal. Gov. Code, § 12940 (j)(1). Moreover, a second tier supervisor who knows of the harassment but fails to do anything is not subject to personal liability although failing to respond appropriately to the complaints of harassment may well trigger liability against the company itself. (Fiol v. Doellstedt, (1996) 50 Cal.App.4th 1318.³)

Although supervisors cannot be held personally liable for discrimination or retaliation, the California Supreme Court in Roby noted explicitly that acts of discrimination “can provide evidentiary support for a harassment claim by establishing discriminatory animus on the part of the manager responsible for the discrimination, thereby permitting the inference that rude comments or behavior by that same manager was similarly motivated by discriminatory animus.” (Roby, supra, 47 Cal.4th at 709.) In that way, the same acts when performed by a supervisor may communicate a “hostile message” which not only encompasses official employment actions but also contributes to harassing social interactions. Finally, the Roby court found that the critical inquiry is whether the overlapping evidence can provide support individually for both harassment and discrimination. At that point, the trier of fact can determine the damages based upon whichever theory under FEHA is successful. (Roby, supra, 47 Cal.4th at 710.)

However, when it comes to punitive damages, supervisors are not necessarily managing agents. In order to establish eligibility for punitive damages, a supervisor must be found to be an officer, director or managing agent. A supervisor or low-level manager with the power to hire or fire is not a managing agent. The key issue will be how much discretion the manager possesses and whether that discretion affects operations as a whole. However, a lower-level employee’s misconduct may trigger punitive damages liability if a “managing agent” ratifies the misconduct.

Thus, in the end, one avenue to determine the extent of liability that might attach against an employer and/or supervisor, a plaintiff’s counsel should evaluate the training and procedures in place to prevent workplace harassment and retaliation.

What are the training materials to seek?

• Mandated California AB 1825 Supervisor Harassment Training

California state law AB 1825, which is part of the Fair Employment and Housing Act, first became effective August 17, 2007. The legislation mandates state-wide sexual harassment training for any employee who performs supervisory functions within a company of 50 employees or more. Specifically, AB 1825 requires companies that regularly employ 50 or more employees (part-time, full-time and temporary), agents and/or independent contractors ensure their covered supervisors undergo two hours of sexual harassment prevention training every two years. This law also requires that newly hired or promoted supervisors undergo such training within six (6) months of their hire or promotion.

The training must instruct supervisors about their obligation to report complaints of discrimination, harassment or retaliation to a designated company representative (such as an HR manager), and must review with supervisors the steps necessary to take appropriate remedial measures to correct harassing behavior.

The training must cover “abusive conduct,” including the definition of abusive conduct, the negative impact of abusive conduct, the elements of and examples of abusive conduct, and the fact that a single act will not constitute abusive conduct unless it is sufficiently severe and egregious. The regulations state that there is not a specific amount of time that must be spent on abusive conduct in the training but it should be covered in a meaningful manner.

In addition, employers must maintain training documentation for a minimum of two years. Documentation must include names of the supervisors trained, training date, sign-in sheet, certificates of attendance or completion, type of training, copies of written or recorded training materials, and the name of the training provider. For webinar training, employers must also retain a copy of the webinar, written materials used by the trainer, written questions submitted during the program, and written responses or guidance that the trainer provided during the webinar. For e-learning training, employers must retain written questions received and written responses or guidance provided.

Thus your discovery should be geared to finding out this information. For companies smaller than 50 employees, the type of training provided is equally important even if not mandated by state law.

• Policies and procedures in place

Most companies have, or should have, Employee Handbooks setting forth policies and procedures, including those related to claims and complaints of discrimination and harassment in the workplace. In fact, on April 1, 2016, revised FEHA regulations took effect, emphasizing an employer’s affirmative duty to take steps to create a workplace that is free from discrimination, harassment and retaliation.

To that end, the regulations make it mandatory for employers to have a written anti-discrimination, harassment and retaliation policy that covers specific information and sets up a complaint and investigation process. Thus, in addition to distributing the Department’s DFEH-185 brochure on sexual harassment, or an alternative writing that complies with Government Code section 12950, an employer shall develop a harassment, discrimination, and retaliation prevention policy that:

(1) Is in writing;

(2) Lists all current protected categories covered under the Act;

(3) Indicates that the law prohibits coworkers and third parties, as well as supervisors and managers, with whom the employee comes into contact from engaging in conduct prohibited by the Act;

(4) Creates a complaint process to ensure that complaints receive:

(A) An employer’s designation of confidentiality, to the extent possible;

(B) A timely response;

(C) Impartial and timely investigations by qualified personnel;

(D) Documentation and tracking for reasonable progress;

(E) Appropriate options for remedial actions and resolutions; and

(F) Timely closures.

(5) Provides a complaint mechanism that does not require an employee to complain directly to his or her immediate supervisor, including, but not limited to, the following:

(A) Direct communication, either orally or in writing, with a designated company representative, such as a human resources manager, EEO officer, or other supervisor; and/or

(B) A complaint hotline; and/or

(C) Access to an ombudsperson; and/or

(D) Identification of the Department and the U.S. Equal Employment Opportunity Commission (EEOC) as additional avenues for employees to lodge complaints.

(6) Instructs supervisors to report any complaints of misconduct to a designated company representative, such as a human resources manager, so the company can try to resolve the claim internally. Employers with 50 or more employees are required to include this as a topic in mandated sexual harassment prevention training, pursuant to section 11024 of these regulations.

(7) Indicates that when an employer receives allegations of misconduct, it will conduct a fair, timely, and thorough investigation that provides all parties appropriate due process and reaches
reasonable conclusions based on the evidence collected.

(8) States that confidentiality will be kept by the employer to the extent possible, but not indicate that the investigation will be completely confidential.

(9) Indicates that if at the end of the investigation misconduct is found, appropriate remedial measures shall be taken.

(10) Makes clear that employees shall not be exposed to retaliation as a result of lodging a complaint or participating in any workplace investigation.

Dissemination of the policy shall include one or more of the following methods:

(1) Printing and providing a copy to all employees with an acknowledgment form for the employee to sign and return;

(2) Sending the policy via e-mail with an acknowledgment return form;

(3) Posting current versions of the policies on a company intranet with a tracking system ensuring all employees have read and acknowledged receipt of the policies;

(4) Discussing policies upon hire and/or during a new hire orientation session; and/or

(5) Any other way that ensures employees receive and understand the policies.

Any employer whose workforce at any facility or establishment contains 10 percent or more of persons who speak a language other than English as their spoken language shall translate the policy into every language that is spoken by at least 10 percent of the workforce.

All of these tools are created to ensure that employees are provided a safe and protected work environment and that supervisors are trained sufficiently to know their obligations under the law by virtue of their position. Discovery of these materials can demonstrate the employer’s failure to follow the law, either in providing sufficient training, policies or enforcement, strengthening claims of liability against them. Moreover, these guidelines and the guidelines or policies of the employer, if any, provide a roadmap for reviewing the behavior, actions and attitude of the supervisor. It gives you the ability to not only test their knowledge of what actions constitute harassment/discrimination, but you can also test their actions against these guidelines related to harassing behavior and/or how they handled complaints. For example, guidelines, tests or other training materials often contain hypotheticals. These can be used to examine the supervisor’s knowledge of the policies, but also some fit closely with the harassing or offensive behavior at issue in your case. Then they are useful to demonstrate the complete disregard of the policies or guidelines by the individual supervisor.

All in all, the employer’s lack of follow-through with appropriate training can be a strong nail in solidifying liability against the employer and those same training materials can help to demonstrate clearly that the harassing supervisor is clearly subject to individual liability.