The U.S. Supreme Court has declined to review the Sixth Circuit’s decision in Bivens v. Zep, leaving intact that court’s holding that an employer’s liability under Title VII for harassment of employees by third parties depends on the employer’s intent. The Court’s decision also leaves in place a growing divide among the federal courts of appeals regarding the legal standard to establish liability on this issue.
What This Means for Employers
The Supreme Court’s denial of review means that there is no single, nationwide standard governing employer liability under Title VII for third-party harassment despite Title VII being a federal law that, in principle, is intended to apply uniformly across the United States. Instead, employers’ obligations may vary depending on the jurisdiction in which a claim is brought. As discussed in our previous Alert, the Sixth Circuit’s decision departs from the negligence standard applied by other federal courts of appeals (including the First, Second, Eighth, Ninth, Tenth, and Eleventh Circuits) and by the EEOC to claims of harassment by third parties.
Under the negligence standard, employers may be liable for harassment by third parties if the employer knew or should have known of the conduct and failed to take prompt, reasonable corrective action. By contrast, under the Sixth Circuit’s approach in Bivens, an employer may be liable only if it intended the harassment by the third party to occur or was substantially certain that it would occur. This divergence creates the result that a Title VII claim may be evaluated under different legal standards, and possibly result in different liability findings, depending solely on where the alleged conduct occurs. Even so, what remains clear is that employers cannot knowingly allow harassing conduct directed towards their employees by third parties.
Practical Takeaways
Regardless of the evolving legal landscape, employers can reduce risk by focusing on steps that remain important across jurisdictions:
- Clear reporting channels: Ensure employees understand how and where to report concerns involving customers, clients, vendors, or any other third-party.
- Prompt investigation: Treat complaints involving third parties with the same urgency as internal complaints.
- Flexible corrective measures: Be prepared to reassign accounts, adjust schedules, limit site access, or take other practical and legal steps to stop harassing behavior.
- Manager training: Supervisors should understand that dismissing or minimizing third-party conduct can create legal liabilities and that harassing conduct by a third party towards an employee must be properly addressed.
- Documentation: Maintain contemporaneous records, which demonstrate that complaints were addressed promptly.
These steps not only reduce legal exposure but also support employee retention, morale, and workplace safety, regardless of the legal standard applied.