Third Circuit Issues Major Employment Law Decision Affecting New Jersey Sexual Harassment Claims

The United States Court of Appeals for the Third Circuit recently issued an important decision on the law of sexual harassment in the case of Sheri Miransky versus Susquehanna County and Thomas Yadlosky, Jr.  The Third Circuit hears appeals from the Federal District Courts of New Jersey, Pennsylvania, Delaware and the Virgin Islands.  Its decisions are binding on questions of federal law in New Jersey.  The only higher court in the nation is the United States Supreme Court.

 

The Facts

The facts are long, but generally speaking Sheri Minarsky suffered from years of significant sexual harassment by her supervisor.  She did not complain for several years because she feared retaliation, which the supervisor threatened, and because she saw that upper management knew of his harassment against other employees and did nothing.  Finally after four years she did complain, and her supervisor was fired.

Miransky sued for sexual harassment under Title VII of the Federal Civil Rights Act of 1964.  The United States District Court for the Middle District of Pennsylvania (the United States District Courts are the federal trial level courts).  The District Court judge granted summary judgment dismissing Mr. Miransky’s claims against the County based on the “Farragher-Ellerth” affirmative defense because she had not utilized the complaint procedures in the County’s anti-harassment policy.

 

The Third Circuit’s Analysis of the Farragher-Ellerth Defense

Title VII bars sex-based discrimination in the workplace, sexual harassment including the “Farragher-Ellerth” defense is based on two decisions by the United States Supreme Court in 1998, Burlington Industries, Inc. v. Ellerth, and Faragher v. City of Boca Raton.  The Third Circuit quoted these cases, explaining that in a case where there was sexual harassment but no tangible economic action (such as firing, demotion, etc.), such as, as here, to get the benefit of the affirmative defense:

The employer must show “(a) that the employer exercised reasonable care to prevent and correct promptly any sexually harassing behavior, and (b) that the plaintiff employee unreasonably failed to take advantage of any preventive or corrective opportunities provided by the employer or to avoid harm otherwise.”

The cornerstone of this analysis is reasonableness: the reasonableness of the employer’s preventative and corrective measures, and the reasonableness of the employee’s efforts (or lack thereof) to report misconduct and avoid further harm. Thus, the existence of a functioning anti-harassment policy could prove the employer’s exercise of reasonable care so as to satisfy the first element of the affirmative defense.

To prove the second element of the affirmative defense, that the plaintiff unreasonably failed to avail herself of the employer’s “preventive or corrective opportunities,” the Supreme Court has held that “proof that an employee failed to [exercise] reasonable care to avoid harm . . . will normally suffice to satisfy the employer’s burden under the second element of the defense.”

In its decision, the Court noted that for the first element, while Miransky had waited four years, the touchstone was whether the County had an “effective” anti-harassment policy in place.  Because the County had known of the supervisor’s harassment and not stopped it, there were certainly grounds for a jury to decide that the policy was not, in fact, effective.  Likewise, the mere fact that the County fired the supervisor after so long could just have easily been proof that for four years the County had not used reasonable care to prevent and correct his behavior.

For the second element, the Court found that Miransky certainly had a plausible argument that her delay was reasonable given the County’s inaction and her supervisor’s threats of retaliation.  The Court explained:

Although we have often found that a plaintiff’s outright failure to report persistent sexual harassment is unreasonable as a matter of law, particularly when the opportunity to make such complaints exists, we write to clarify that a mere failure to report one’s harassment is not per se unreasonable. Moreover, the passage of time is just one factor in the analysis. Workplace sexual harassment is highly circumstance-specific, and thus the reasonableness of a plaintiff’s actions is a paradigmatic question for the jury, in certain cases. If a plaintiff’s genuinely held, subjective belief of potential retaliation from reporting her harassment appears to be well-founded, and a jury could find that this belief is objectively reasonable, the trial court should not find that the defendant has proven the second Faragher-Ellerth element as a matter of law. Instead, the court should leave the issue for the jury to determine at trial.

Here, Minarsky asserts several countervailing forces that prevented her from reporting Yadlosky’s conduct to Beamer or a County Commissioner: her fear of Yadlosky’s hostility on a day-to-day basis and retaliation by having her fired; her worry of being terminated by the Chief Clerk; and the futility of reporting, since others knew of his conduct, yet it continued. All of these factors were aggravated by the pressing financial situation she faced with her daughter’s cancer treatment.

Indeed, the Court noted that “Minarsky identifies instances where asserting herself rendered her working conditions even more hostile, and she was led to believe that she should not protest her supervisor’s conduct. Presented with these facts, a reasonable jury could find that Minarsky’s fear of aggravating her work environment was sufficiently specific, rather than simply a generalized, unsubstantiated fear.”

Appellate judicial opinions are normally dry recitations of the facts and the law.  And perhaps nothing is more dry and boring than footnotes in an appellate judicial opinion.  That makes footnote 12 all the more remarkable.

This appeal comes to us in the midst of national news regarding a veritable firestorm of allegations of rampant sexual misconduct that has been closeted for years, not reported by the victims. It has come to light, years later, that people in positions of power and celebrity have exploited their authority to make unwanted sexual advances. In many such instances, the harasser wielded control over the harassed individual’s employment or work environment. In nearly all of the instances, the victims asserted a plausible fear of serious adverse consequences had they spoken up at the time that the conduct occurred. While the policy underlying Faragher-Ellerth places the onus on the harassed employee to report her harasser, and would fault her for not calling out this conduct so as to prevent it, a jury could conclude that the employee’s non-reporting was understandable, perhaps even reasonable. That is, there may be a certain fallacy that underlies the notion that reporting sexual misconduct will end it. Victims do not always view it in this way. Instead, they anticipate negative consequences or fear that the harassers will face no reprimand; thus, more often than not, victims choose not to report the harassment. Recent news articles report that studies have shown that not only is sex-based harassment in the workplace pervasive, but also the failure to report is widespread. Nearly one-third of American women have experienced unwanted sexual advances from male coworkers, and nearly a quarter of American women have experienced such advances from men who had influence over the conditions of their employment, according to an ABC News/Washington Post poll from October of 2017. Most all of the women who experienced harassment report that the male harassers faced no consequences.  Additionally, three out of four women who have been harassed fail to report it. A 2016 Equal Employment Opportunity Commission (EEOC) Select Task Force study found that approximately 75 percent of those who experienced harassment never reported it or filed a complaint, but instead would “avoid the harasser, deny or downplay the gravity of the situation, or attempt to ignore, forget, or endure the behavior.  Those employees who faced harassing behavior did not report this experience “because they fear[ed] disbelief of their claim, inaction on their claim, blame, or social or professional retaliation.” .

In sum, the Miransky decision places a much higher burden on employers seeking to escape liability under Title VII for their supervisors’ sexual harassment.  Having an anti-harassment policy is simply not enough.  The policy must be shown to have teeth.  An employer cannot merely show that an employee didn’t take advantage of the complaint procedures in its policy.  The employer has the burden of showing both that the policy itself was effective, and that the employee unreasonably failed to take advantage of it. Because it is an affirmative defense, the burden is on the employer to make this showing.  Based on this case, it will be much harder for the employer to meet that burden.

 

The Farragher-Ellerth Defense Under New Jersey’s Law Against Discrimination

Similarly to Title VII, New Jersey’s Law Against Discrimination prohibits sexual harassment.  In a divided 2015 opinion, the New Jersey Supreme Court adopted the Farragher-Ellerth defense.  However, the court noted that merely having a policy would not allow an employer to escape liability.  The Court explained that “the affirmative defense provides no benefit to employers who empower sexually harassing employees who take tangible employment actions against their victims, employers who fail to implement effective anti-harassment policies, and employers whose policies exist in name only.”  The Court noted that the New Jersey courts look to Federal courts decisions regarding Title VII for guidance in interpreting New Jersey’s Law Against Discrimination. Given this caveat and the federal court’s decision in the Miransky case, it will be difficult for employers to escape liability for their supervisors’ illegal harassment.

 

The Takeaway

The takeaway for employers is that they must not only have an anti-sexual harassment policy; they must make sure that all their employees have it, that they effectively enforce it, and are seen to enforce it.  Ignoring or not responding to harassment can be fatal to their defense.

The takeaway for employees is that if there is a policy they should use the complaint procedures outlined in it.  This case is something of an outlier.  Normally failure to utilize an anti-harassment policy will doom an employee’s harassment claim.  (In this case, it was probably the egregious failure by the County to enforce the policy which caused the Court to reject the defense.)

 

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