LeClairRyan attorney Thomas C. Regan discusses litigation revolving around allegations that a supervisor failed to properly respond to sexual harassment of an employee by a non-employee, providing insight to help employers understand their potential liability and avoid getting ensnared in similar situations.
The #MeToo movement has hammered home for employers the critical importance of keeping sexual harassment out of the workplace. However, a recent federal court case underscores how sexual harassment can occur in ways that defy what many employers might think of as the typical pattern. The ruling by the U.S. District Court for the Eastern District of Pennsylvania comes in a case that has nothing to do with a male boss or co-worker behaving inappropriately with a female colleague. It hinges instead on allegations that a supervisor failed to properly respond to sexual harassment of an employee by a non-employee.
That might bring to mind the Hollywood trope of a hardworking waitress forced to regularly endure catcalls or worse by a male customer, but Hewitt v. BS Transportation defies even this familiar scenario. It involves a lawsuit over alleged male-to-male sexual harassment in the world of big rigs and fuel refineries. In court documents, truck driver Carl Hewitt alleges that his supervisor at BS Transportation failed to take prompt remedial action in response to sexual harassment of Hewitt by a male worker at a fuel distribution company’s refinery. Hewitt routinely traveled to the Pennsylvania facility to pick up fuel bound for NASCAR racecars.
The truck driver alleges that the harassment started in 2014 with sexual comments and hand gestures made “at least once or twice a week” by refinery employee Anthony Perillo. He also claims that Perillo’s supervisor and other refinery employees knew of this behavior but did nothing to stop it. After having “begged” Perillo to stop making such remarks, Hewitt alleges that Perillo took even more aggressive actions such as brushing past him and making bodily contact or “parading around” in his undergarments. According to Hewitt’s account, in August 2016, Perillo grabbed Hewitt by the buttocks, shoved him into a truck and asked “Do you like that?” Hewitt claims his manager at BS Transportation promised to “make a report” and “take care of it,” but never told the fuel distribution company about the alleged behavior or investigated it. The plaintiff further claims his manager asked him to stay quiet about the allegations — and fired Hewitt when he brought them up again.
This past January, U.S. District Judge Jan E. DuBois issued a ruling allowing Hewitt’s case against BS Transportation to proceed. While the issue of sexual harassment by non-employees is unresolved in the U.S. Court of Appeals for the 3rd Circuit, the judge noted, other district courts in the 3rd Circuit have ruled that an employer may be held liable “where the employer (or its agents or supervisory employees) knows or should have known of the conduct and fails to take immediate and appropriate corrective action.”
Business owners in a broad array of sectors — especially retail and the hospitality industry — need to be aware of the potential risks they may face with respect to sexual harassment of their employees by non-employees. The latter group could include customers, vendors, business partners or even government inspectors or other personnel. Below are four potential takeaways from the Hewitt case for employers:
1. Stay Updated on the Law
Many harassment and discrimination claims filed against employers rely on Title VII of the Civil Rights Act of 1964. Generally speaking, though, this federal law applies to employers with 15 or more employees. As the defendants in Hewitt have pointed out, BS Transportation is a small company with fewer than 15 employees — a fact that could nullify Title VII-related claims as the case proceeds. However, certain of Hewitt’s complaints also rely on the Pennsylvania Human Relations Act, a state law that defines “employer” as “any person employing four or more persons within the Commonwealth.” That means Hewitt could survive, but in state court.
Companies should stay informed about the ever-involving definitions of terms such “employer” or “supervisor” at both the federal and state levels. Back in 2017, for example, the 3rd Circuit Court of Appeals issued a significant decision more broadly interpreting “supervisor” under both Title VII and the New Jersey Law Against Discrimination. Such definitions are critical, because they help employers fully grasp their potential liability and more accurately determine who at the company should receive anti-discrimination training for supervisory personnel.
2. Check Your Policies
Certain types of businesses, such as those that serve a lot of alcohol, may already operate with clear policies on harassment by disinhibited, ill-behaved customers or other non-employees. Here the task is to make absolutely sure those rules are understood and followed. Schedule regular training sessions, and make sure new employees understand these policies. Other businesses may lack clear policies on sexual harassment involving non-employees. If so, they should formulate and disseminate them posthaste and engage in the requisite training of all appropriate parties.
3. Question Your Assumptions
Take care to imagine the various ways in which problematic interactions could occur. When the behavior defies the expected pattern, your company’s supervisors and other employees may be more likely to casually ignore it, perhaps because it seems “funny” or “no big deal.” The imperative here is to err on the safe side: Employees should be encouraged to promptly respond, based on clearly established company policies rooted in all applicable laws, to anything that could reasonably be construed as harassment. This response should never be “outsourced;” if an employee complains about harassment by a non-employee, the supervisor cannot simply say, “OK, I’ll tell the guy’s boss to make him stop.” What if that non-employee’s boss rolls his eyes and ignores the matter?
4. Treat All Non-Employees Equally
A particular danger for business owners is to give deferential treatment to non-employees they see as being disproportionately valuable. Imagine that a customer worth $2 million in annual business sexually harasses one of your employees. Some employers might be tempted to try to settle the matter by paying the employee, say, $100,000 and asking him or her to sign a nondisclosure agreement. But that cold calculus would be wrong on every level. In today’s social-media-driven world, the arrangement is quite likely to be revealed publicly (indeed, your employee might already have shared the details on Facebook, Twitter and the like). Imagine the liability the company will face if its continuing business relationship with the harasser leads to additional victims down the line.
Unfortunately, taking action against non-employee harassers is not, in itself, risk-free. My office once represented a major retailer in Pennsylvania that had received threats of litigation from a sexually harassing customer it had — quite properly and proactively — banned from the store. The alleged harasser slinked off and never filed any legal action, but the matter shows how your response must be carefully considered every step of the way.