A Questions of Employment Law: Anti-harassment policy is the best defense

Claire, president of the ABC Company, asks Tom, manager of the human resources department, what steps the company needs to take to help protect itself against sexual harassment lawsuits. Tom reports a recent case where the court dismissed a sexual harassment claim because the employer took reasonable measures to prevent and correct the harassment. Are there lessons to be learned by ABC?

The First Circuit Court of Appeals held in Chaloult v. Interstate Brands Corporation (Aug. 28, 2008) that a female employee who claimed she was sexually harassed by her supervisor cannot maintain her Title VII claim against the employer even though she alleged a co-worker had been aware of the alleged harassment.

Bonnie Chaloult worked at IBC for five years before applying for and receiving an entry-level supervisor position. In February 2005, Kevin Francoeur, assistant production manager, became Chaloult’s immediate supervisor. Chaloult submitted a letter of resignation six months later. In her resignation letter, she alleged for the first time that her supervisor, Francoeur, had questioned her personal affairs with another entry-level supervisor, Jim Anderson, and that she no longer felt comfortable working for Francoeur.

After notifying the assistant human resources manager, Paul Santos, IBC’s department manager, met with Chaloult to discuss the statements in her letter. Chaloult referred to only one incident that had taken place.

Following the meeting, Santos reported the incident to human resources, conducted an investigation and spoke to both Francoeur and Anderson. The conclusion was that no sexual harassment occurred, although the supervisor was disciplined for using extreme and inappropriate language.

Chaloult filed a sexual harassment lawsuit against IBC a year later, alleging she was sexually harassed by Francoeur for a six-month period. For the first time, Chaloult alleged a number of incidents of inappropriate language and sexual propositions that she had not mentioned in her resignation letter or to Santos.

Anderson, a peer of Chaloult, witnessed some of the incidents but did not report them. As entry-level supervisors, Chaloult and Anderson both reported to Francoeur.

IBC had an anti-harassment policy in place that included procedures for reporting sexual harassment. The policy also required supervisors to report any incidents of sexual harassment to management.

Under Title VII of the Civil Rights Act of 1964, an employer is subject to vicarious liability for sexual harassment perpetrated by an employee’s supervisor when the sexual harassment does not result in a tangible employment action. Under the Faragher-Ellerth defense established in 1998 by the U.S. Supreme Court, an employer may shield itself from such liability and prevail on an employee’s harassment claim if the employer demonstrates that the employer had exercised reasonable care to avoid harassment and to eliminate it when it might occur and the employee failed to act with reasonable care to take advantage of the employer’s safeguards and otherwise prevent harm that could have been avoided.

Two-pronged defense

The court found that IBC could assert the two-pronged Faragher-Ellerth affirmative defense to the sexual harassment claim.

Chaloult did not contest that IBC met the second prong of the employer defense. The issue was whether the company met the first prong and took reasonable care to avoid the sexual harassment.

The court found IBC had satisfied its burden as to the first prong. IBC had a sexual harassment policy in place, trained its employees regarding the policy, conducted an investigation into the complaint made at the time of Chaloult’s resignation and took appropriate action.

Chaloult argued that the first prong had not been met because IBC had a policy requiring all supervisors to report harassment, and therefore Anderson’s knowledge of the conduct could be imputed to the employer.

The court disagreed, noting that to impute a peer’s knowledge to the employer just because the employer voluntarily adopts a policy requiring all supervisors to report sexual harassment would “discourage and penalize” employers from adopting anti-harassment policies.

Of course, in some cases a supervisor’s knowledge of harassing behavior may be imputed to the company to require corrective action. But here, there was no claim that anyone above Chaloult knew of such conduct.

This case reinforces the importance of establishing anti-harassment policies and complaint procedures for reporting alleged harassment.

It also highlights the importance of conducting prompt investigations of complaints, whether formal or informal. These are all critical tools in increasing an employer’s chance of prevailing against sexual harassment claims.

Jennifer Parent, director in the Litigation Department of McLane, Graf, Raulerson & Middleton, can be reached at 603-628-1360 or Jennifer.parent@mclane.com.