On June 24, 2013, the United States Supreme Court issued an important decision regarding the reach of Title VII in an employment context. In Vance, the Court was faced with the question of whether the “supervisor” liability rule established by the Court in earlier cases applied to harassment by employees who had the authority to direct and oversee an employee’s daily work or whether the rule was limited to only those “supervisors” having the power to “hire, fire, demote, promote, transfer, or discipline” the employee. In a 5-4 decision, with Justice Alito writing the opinion of the Court, the Court held that an employee is a “supervisor” for purposes of Title VII only where the employee has the power to take tangible employment actions against the complaining employee (i.e. having the power to “hire, fire, demote, promote, transfer, or discipline”).
FACTS AND PROCEDURAL HISTORY OF VANCE
Maetta Vance, an African-American woman, worked for Ball State’s Banquet and Catering Department for over 15 years. For the entire time that Ms. Vance was employed in that capacity, her direct supervisor was Bill Kimes, general manager of the Banquet and Catering Department. In 2005, Ms. Vance complained about treatment she had received in the workplace at Ball State. She alleged that she had been threatened by Saundra Davis, catering specialist, and that another employee, Connie McVicker, had directed racial epithets toward her. Ball State investigated Ms. Vance’s allegations and, as a result, issued a written warning to Ms. McVicker. Regarding Ms. Vance’s complaints against Ms. Davis, the investigation resulted in conflicting accounts of what had occurred between Ms. Vance and Ms. Davis. As a result of the conflicting information received during the investigation, Ball State counseled both employees regarding their behavior. Throughout 2006 and 2007, Ms. Vance continued to complain about her treatment by Ms. McVicker and Ms. Davis.
Ultimately, Ms. Vance filed a lawsuit against Ball State, Ms. Davis, Ms. McVicker, and Mr. Kimes. In part, Ms. Vance claimed that the conduct of Ms. Davis created a hostile working environment for which Ball State should be held liable, because Ms. Davis was a supervisor.
Ball State moved for summary judgment on all claims brought by Ms. Vance. Based on precedents of both the Supreme Court and the Seventh Circuit Court of Appeals, the district court concluded that Ball State could not be held liable under Ms. Vance’s hostile work environment claims because Ms. Davis was not Ms. Vance's supervisor, in that Ms. Davis did not have the power to "hire, fire, demote, promote, transfer or discipline" Ms. Vance. Thus, the district court held that the acts of Ms. Davis could not be imputed to Ball State, which would have given rise to supervisor liability under Title VII.
Ms. Vance appealed the district court's decision to the Seventh Circuit Court of Appeals. The Court of Appeals affirmed the decision of the district court, concluding that because Ms. Davis did not have the power to "hire, fire, demote, promote, transfer or discipline" Ms. Vance, she did not have sufficient authority to be her “supervisor” for the purposes of liability under Title VII.
SUPREME COURT DECISION
In its decision, the Supreme Court determined that the test for who is to be considered a “supervisor” for Title VII purposes is the bright-line standard adopted by the Seventh Circuit. Under this test, an employer can be vicariously liable under Title VII for the actions of one of its employees "when the employer has empowered that employee to take tangible employment actions against the victim, i.e., to effect a 'significant change in employment status, such as hiring, firing, failing to promote, reassignment with significantly different responsibilities, a decision causing a significant change in benefits.'" With this decision, the Court attempted to provide clear guidance to employers and employees regarding who qualifies as a supervisor for purposes of Title VII. In adopting this standard, the Court rejected the position the set forth by the EEOC in its Enforcement Guidance. Under the EEOC’s Enforcement Guidance, a supervisor is described as someone who either has the authority to undertake or recommend tangible employment decisions affecting the employee or has the authority to direct the employee's daily work activities. In its rejection of the EEOC position, the Court described this position as "a study in ambiguity".
By adopting a bright-line rule, the Court indicated that lower courts should be able to determine early on in Title VII litigation whether any basis exists for imposing vicarious supervisory liability on an employer, by determining whether or not the employee in question had the power to "hire, fire, demote, promote, transfer or discipline" the complaining employee.
The decision by the Court in Vance is good news for employers, in that it limits circumstances where vicarious liability may be imposed under Title VII and provides clear guidance as to what those circumstances are. However, the decision does not impact the ongoing responsibilities imposed on employers to provide a workplace that is free from discrimination and discriminatory hostility. Prudent employers should continue to provide regular periodic training to their workforce regarding discrimination and harassment, with additional training to their managers, including those managers where there may be a question as to whether they are "supervisors" for purposes of Title VII. Employers should be certain that the training provided makes it clear that all managers have an obligation to take steps to prevent and to correct any discriminatory or harassing behavior.