6th Circuit sets higher standard for employer liability in third-party harassment case

In a recent decision, the U.S. 6th Circuit Court of Appeals (whose rulings apply to employers in Kentucky, Michigan, Ohio, and Tennessee) established a new, higher standard for holding employers liable for harassment committed by third party, nonemployees. The main question before the court was, “When, if ever, is an employer liable—either directly or vicariously—for the harassment of an employee by a nonemployee?”

Customer harassment

While working as a sales representative for Zep, Inc., Dorothy Bivens contended a business customer locked her in his office and asked her on a date. She refused the customer’s invitation and ended the conversation. She reported the incident to her supervisor, who reassigned the customer to another sales team so she wouldn’t have to interact with him again. Shortly after, she was terminated as part of a company-wide reduction in force. She sued Zep, alleging a hostile work environment, retaliation, and discrimination.

The 6th Circuit ruled in favor of Zep, reasoning that it could be liable for the customer’s actions only if it intended for Bivens to experience a hostile work environment at the hands of the customer or was substantially certain that she would. This is a significant-seeming departure from the typical negligence analysis used by most courts and the Equal Employment Opportunity Commission (EEOC). The negligence standard is where an employer is liable if they “knew or should have known” about the harassment and failed to take prompt corrective action.