©2001 Connell Foley LLP

Sexual harassment has been defined by our Supreme Court as consisting of unwelcomed sexual advances, requests for sexual favors and/or verbal or physical conduct of a sexual nature that results in an alteration of the terms or conditions of employment. Sexual harassment jurisprudence divides cases into two categories – Quid pro quo, when an employer attempts to make an employee’s submission to sexual demands a condition of employment and Hostile Work Environment which, by contrast, occurs when an employer or fellow employee harasses an employee because of his or her sex rendering the working environment hostile, intimidating or offensive.

Hostile-work-environment harassment is recognized as a cause of action under the New Jersey Law Against Discrimination ("NJLAD"). In the seminal case of Lehmann v. Toys 'R' Us, the New Jersey Supreme Court defined hostile-work-environment sexual harassment as:

Pursuant to this definition, in order to prove that a plaintiff (assuming a woman) was subjected to hostile environment sexual harassment, she must be able to prove that the complained-of discriminatory conduct:

would not have occurred but for [her] gender; and it was (2) severe or pervasive enough to make a (3) reasonable woman believe that (4) the conditions of employment are altered and the working environment is hostile or abusive.

Our courts have decided that this same test is applicable to harassment based on other forms of discrimination, including race and age-based discrimination.

Plaintiff's first burden in proving a prima facie case is to present credible evidence that discriminatory conduct occurred and that, but for her gender, it would not have occurred. As the Lehmann Court explained:

The Court explained that, in the absence of conduct "obviously based on the victim's sex, the victim must make a prima facie showing that the harassment occurred because of her sex." To meet that burden, a plaintiff must show that the conduct "more likely than not" occurred because of the protected characteristic. If the plaintiff cannot prove this first key element, the Court's inquiry is at an end, because the "defining characteristic" of actionable hostile-environment harassment under the NJLAD is that it occurs "because of the victim's sex." The Court also made it clear that not all harassment violates the LAD. If a supervisor is equally crude to all employees, regardless of their sex, it is not sexual harassment

If the plaintiff can meet this initial burden, then she must prove the remaining three elements to support her claim. These elements are "interdependent:"

In determining whether comments or gestures are "severe or pervasive," the following factors will be considered:

1. the total physical environment of the plaintiff’s work area;
2. the degree and type of obscenity that filled the environment of the workplace, both before and after the plaintiffs were assigned to the specific workplace;
3. the nature of the unwelcome sexual words or sexual gestures;
4. the frequency of the offensive encounters;
5. the severity of the offensive encounters;
6. whether the unwelcome comments or gestures were physically threatening;
7. whether the offensive encounters unreasonably interfered with any [of] plaintiff’s work performance, but subject to the admonition that each plaintiff is not obligated to prove that the unwelcome comments or gestures actually did interfere with each plaintiff’s work performance; and
8. whether the offensive encounters had an effect on any plaintiff’s psychological well-being, but also subject to an admonition that each plaintiff need not demonstrate specific psychological harm.

Baliko v. Union of Operating Engineers, 332 N.J. Super 261 (App.Div.1999)

A plaintiff cannot prove her case simply by adducing evidence that she believed the conduct to be "sufficiently severe or pervasive to alter the conditions of [her] employment and create an abusive working environment." Rather, the conduct must be such that a reasonable person in plaintiff's protected category would have found it so. In cases involving sexual harassment, the standard is that of a "reasonable woman". This is an objective standard – not a subjective one. A plaintiff's subjective response is not an element of a hostile work environment cause of action. It is the harassing conduct that must be severe or pervasive, not its effect on the plaintiff. The creation of working conditions a "reasonable" woman would consider hostile is all the "harm" a plaintiff must show. Lehman rejected the requirements of any proof that a plaintiff’s psychological well being was affected, nor is it necessary that any economic loss be shown.

The reasonable woman standard is said to protect the employer from the hypersensitive employee. As the Lehmann Court observed, "[i]t would not serve the goals of … equality to credit a perspective that was ... wholly idiosyncratic." Thus, while

Our courts have also noted that "it will be a rare and extreme case in which a single incident will be so severe that it would, from the perspective of a reasonable woman, make the working environment hostile," but it can occur. The New Jersey Supreme Court ruled in Taylor v. Metzger, 152 N.J. 490 (1998), that a supervisor's reference to an African-American subordinate as a "jungle-bunny," to her face and in front of witnesses, was determined to be one of those "rare and extreme cases" envisioned by the Lehmann Court where one incident could create a hostile working environment. In that case, however, the kind of racial slur used by the employee's supervisor was an egregious manifestation of bigotry and unlawful discrimination known to our culture; it was viewed as the "extreme case" where an isolated incident might be sufficiently severe or pervasive to state an actionable claim. Though Taylor was a race discrimination case, it can be imputed to a sexual harassment hostile working environment.

The required showing of severity or seriousness of the harassing conduct varies inversely with the pervasiveness or frequency of the conduct. Lehman v. Toys "R"Us.

Normally, a plaintiff is required to adduce evidence of "numerous incidents" which, taken together, could create the requisite degree of hostility. To be actionable as pervasive harassment, conduct must be extreme. Courts consider the totality of circumstances, including the "frequency of the discriminatory conduct; its severity; whether it is physically threatening or humiliating, or a mere offensive utterance and whether it unreasonably interferes with an employee’s work performance. Harassment is pervasive when incidents of harassment occur either in concert or with regularity, Andrews v. City of Philadelphia, 895 F2d 1475. Our courts have characterized pervasive harassment as "a gauntlet of sexual abuse". Mentor v. Vinson 477 U.S.57(1986). It must be more than a single non-extreme circumstance. (cf. Taylor, supra.)

Under New Jersey law, it has been found that scattered incidents of alleged harassment over an eight-month period, including company president's invitations to work-out and dine together, appreciative comments about plaintiff's body, and requests for the key to her corporate apartment, did not necessarily amount to severe or pervasive conduct. Lynch v. New Deal 974 F.Supp 441 (DNJ1997). A few instances of "harassment" on two or three days over the course of a month were not pervasive, taken as a whole. Reyes v. McDonald Pontiac 997 F.Supp. 614(D.N.J.1998). However, each case will be viewed on its own set of facts.

It is well established that the anti-discrimination laws simply are not intended to be a remedy for all boorish behavior or interpersonal problems. It has been found that Title VII and the NJLAD "are not cure-alls for bad feelings or personality conflicts", or every tasteless joke. Occasional vulgar banter, tinged with sexual innuendo" does not constitute sexual harassment. Reyes v. McDonald Pontiac 997 F.Supp.614(D.N.J. 1998); DeAngelis v. El Paso Police Assn. 51F2d 591(1995).

However, when harassment is found against a supervisor, our Supreme Court has concluded that an employer will be held strictly liable for equitable damages – that is, directly responsible, without regard to fault, for restoring an aggrieved party to the terms, conditions and privileges they would have enjoyed but for the harassment. This may include hiring or reinstating the victim, disciplining, transferring or firing the harasser, providing back pay and front pay and taking preventative and remedial measures at the workplace.

Compensatory damages are not governed by strict liability. The reason being that the employer is not the only one capable of providing such relief, as is the case with equitable damages. Accordingly, Lehman found that employer liability will be governed by the laws of agency. The liability of a master (employer) for the acts of its agent (supervisor) is outlined in Sec. 219 of the Restatement of Agency as follows:

1. A master is liable for the torts of his servant while acting in the scope of their employment.
2. A master is not liable for the torts of his servant acting outside the scope of employment, unless:

1. the master intended the consequences, or
2. the master was negligent or reckless, or
3. the conduct violated a non-delegable duty, or
4. the servant purported to act on behalf of the master and there was reliance upon apparent authority or the servant was aided in accomplishing the tort by the existence of the agency relation.

1. Did the employer delegate the authority to the supervisor to control the situation of which the plaintiff complains?
2. Did the supervisor exercise that authority?
3. Did the exercise of that authority result in a violation of the LAD?
4. Did the authority delegated aid the supervisor in injuring the plaintiff?

When the answer to each of these questions is Yes – the employer is vicariously liable for the harassment.

Another basis for employer liability is negligence. Though our courts have declined to set forth a standard of negligence for sexual harassment claims, it suggests that negligence may be shown by an employer’s failure to have in place a well-publicized and enforced anti-harassment policy, effective complaint structures, training and/or monitoring mechanisms. The absence of such mechanisms is not negligence per se, nor does the presence of such mechanisms demonstrate the absence of negligence. However, the existence of such mechanisms provides evidence of due care on the part of the employer.

The court urged 5 elements be put in place to prevent harassment complaints:

1. Policies – Available and Posted
2. Complaint Structures – Formal and Informal
3. Training – mandatory for supervisors
4. Monitoring mechanisms
5. Commitment and consistent practice.

Of importance to note is that an employer’s investigation of alleged sexual harassment is relevant to a claim under the LAD and our Supreme Court, in Payton v. N.J. Turnpike Authority, has concluded that materials relating to this investigation are discoverable by the complainant. This can be true even if the internal investigation is done by or through an attorney. The complainant is entitled to information, at a minimum, relating to the extent and timing of the investigation, information found and determined from the investigation, the evaluation of the investigation and the action taken pursuant thereto.

Where an employer has a well-established policy against sexual harassment, promptly investigates and effectively acts to remedy a situation of which an employee complains, the employer may not be liable for the alleged harassment of the employee. An employer should have "a reasonably available avenue" by which complaints can be made, investigated, and remedied. Smith v. Nordstrom (App.Div.1996)A-937-95T1. A company which has in place a well-publicized anti-harassment policy with an effective complaint structure, and which responds promptly when apprised of misconduct on the part of a supervisor has a potential defense for liability. Bouton v. BMW 29F2d 103, 111 (3dCir.1994). The presence of an effective sexual harassment policy by the employer that is known to the alleged victim arguably divests harassing supervisors of their apparent authority.

In Smith, supra, the Appellate Division examined whether an employer could be held vicariously liable to a plaintiff for a supervisor's harassing conduct. The court held that an employer could not be held vicariously liable where the employer had a clear anti-harassment policy, the policy set forth the individuals delegated with the responsibility and authority to enforce the policy and these individuals were accessible to the plaintiff. In Bouton, supra, guided by the New Jersey Supreme Court's decision in Lehmann and utilizing agency principles in deciding employer liability for sexual harassment, the Third Circuit held that an employer cannot be held liable for compensatory damages when it has in place an effective grievance procedure which is known to the victim.

Though the majority of cases of sexual harassment seek relief against supervisors, and employers as described above, employers may also be liable for non-supervisory employees and, in some circumstances independent contractors. In such instances of co-worker harassment, our courts have consistently held that, for an employer to be liable, it must know or should have known about the harassment and failed to take prompt action. Erickson v. Marsh-McLennan Co., 117 N.J.568. In reference to independent contractors, in addition to the above requirements, the extent of the contract and any other legal responsibility that the employer may have with respect to the conduct of the third party is compelling.

Quid pro quo sexual harassment occurs when an employer attempts to make an employee’s submission to sexual demands a condition of employment. Quid pro quo is more easily recognizable than hostile work environment and more clearly defined as a cause of action. Lehman v. Toys R Us, supra. Simply put, when an implicit or explicit threat is made that if an employee does not accede to sexual demands, he or she will lose his or her job, receive unfavorable performance reviews, be passed over for promotions or suffer adverse employment consequences, quid pro quo harassment has occurred.

To establish a prima facie case of quid pro quo sexual harassment, a plaintiff must satisfy the following five-part test:

1. The employee was a member of a protected class;
2. The employee was subjected to unwelcome sexual harassment in the form of sexual advances or requests for sexual favors;
3. The harassment complained of was based on sex;
4. The submission to the unwelcome advances was an express or implied condition for receiving job benefits or her refusal to submit resulted in tangible job detriment.

A plaintiff may prove a claim of quid pro quo sexual harassment by showing that his or her "response to unwelcome advances was subsequently used as a basis for a decision about compensation, [terms, conditions, or privileges or employment]." "The plaintiff need not show that the submission was linked to compensation, etc., at or before the time when the advances occurred. But the employee must show that his or her response was in fact used thereafter as a basis for a decision affecting his or her compensation, etc." Farnell, supra.

Once a prima facie case is made, the burden of proof shifts to the defendant to rebut the presumption of discrimination with a legitimate, nondiscriminatory reason for the adverse employment action. If that burden is satisfied by the defendant, plaintiff must then prove that the stated reason for the employment action is "pretextual" and the employment decision was based on sex discrimination. By necessity, claims of sexual harassment must be resolved on a case-by-case basis.

Generally speaking, liability for quid pro quo harassment – harassment which invokes the authority of the employer – can be imputed to an employer under a respondeat superior theory. It affects the tangible aspect of the workplace and accordingly, the employer would be strictly liable for the equitable damages therein – as discussed above, relating to promotion, termination, etc.

In 1998, the United States Supreme Court issued a ruling in which it statedly stepped away from the distinction between quid pro quo and hostile environment harassment in determining employer liability and relied upon a tangible versus non-tangible action. Cf. Burlington Industries, Inc. v. Ellerth, and Faragher. These held that in supervisory harassment cases in which there is tangible employment action, i.e. termination, demotion, the employer is strictly liable. The New Jersey Supreme Court has yet to adopt this "new" approach. However, this "new" approach actually differs little from the approach set forth in Lehmann, since both Ellerth and Faragher, agree with Lehmann's holding that an employer cannot be held strictly liable for a supervisor's acts unless the alleged victim has suffered a "tangible adverse employment action" proven to be causally linked to the alleged harassment. Faragher, 118 S. Ct. at 2293; Ellerth, 188 S. Ct. at 2268-69. This narrow limitation on strict liability is, like our own Supreme Court's ruling in Lehmann, premised upon the Restatement and reliant on traditional interpretations of the agency relationship.

In Ellerth and Faragher, the United States Supreme Court modified the federal standard applied when determining whether an employer can be held vicariously liable for hostile environment sexual harassment with non-tangible employment actions and crafted a two-prong affirmative defense. The defense has 2 elements – 1.) the employer exercised reasonable care to prevent and promptly correct any sexually harassing behavior, and 2.) that the plaintiff unreasonably failed to take advantage of the opportunities to avoid harm. Essentially, in addition to meeting the traditional burden of adducing evidence proving the first prong under federal law, the employer must demonstrate that the plaintiff had the opportunity to mitigate harm with a prompt complaint, but failed to do so. See Faragher, 118 S. Ct. at 2292-93; Ellerth, 118 S. Ct. at 2270.

Finally, aside from vicarious liability, the Court stated "[t]he general rule is that sexual harassment by a supervisor is not conduct within the scope of employment." Ellerth, 118 S. Ct. at 2266-67); Durham Life Ins. Co. v. Evans, 166 F.3d 139, 150 (3d Cir. 1999) following Ellerth and Faragher). Therefore the fundamental issue in determining liability for a supervisor's alleged act is whether the nature of the act was such that it arose from the supervisor's position as an agent of the employer. In other words, the question is whether the supervisor engaged in the act by using the power of the employer vested in him – for example, the power to hire, fire or promote – or in order to further the interests of the employer. If the act does not fall into these categories but was, rather, a personal act, then it is not considered to be within the scope of employment. Ellerth, 118 S. Ct. at 2266-67.

However, as fully discussed throughout this analysis, the burden upon the employer for the acts of its employees is significant. To avoid the potential of liability, aggressive tactics, policies and efforts should be made to avoid the defense of litigation.