- Constructive Discharge Should Not Be Considered a Tangible Employment Action
- January 16, 2004 | Author: John D. Canoni
- Law Firm: Nixon Peabody LLP - New York Office
On December 1, 2003, the Supreme Court granted certiorari to review a Third Circuit (Philadelphia) ruling that a constructive discharge qualifies as a tangible employment action under Burlington Industries v. Ellerth, 524 U.S. 742(1998), and Faragher v. Boca Raton, 524 U.S. 775(1998). The Third Circuit's ruling in Pennsylvania State Police v. Suders, 325 F.3d 432 (3d Cir. 2003), cert. granted, No. 03-95, 2003 U.S. LEXIS 8576, bars an employer from using the special affirmative defense established in Ellerth and Faragher for hostile work environment sexual harassment cases when a constructive discharge is proven. Employers can escape vicarious liability through this affirmative defense only if their supervisors have not taken a "tangible employment action." If, however, a tangible employment action has occurred, the employer is automatically liable for the harassment and may not assert the special affirmative defense.
The forthcoming Supreme Court decision will resolve a sharp split among the circuit courts. The Eighth Circuit, in agreement with the Third Circuit in Suders, has held a constructive discharge is a tangible employment action, Jackson v. Arkansas Department of Education, 272 F.3d 1020 (8th Cir. 2001), cert. Denied, 536 U.S. 908 (2002). The Second Circuit (Caridad v. Metro North Commuter Railroad, 191 F.3d 283, 2d Cir. 1999, cert. Denied, 529 U.S. 1107, 2000) and the Sixth Circuit (Turner v. Dowbrands, Inc., 2000 U.S. App. LEXIS 15733, 6th Cir. 2000), have disagreed. The First Circuit (Reed v. MBNA Marketing Systems, 333 F. 3d 27, 1st Cir., June 2003) would allow a constructive discharge to erase an employer's affirmative defense only in "rare cases" such as where a supervisory job assignment in retaliation for spurned sexual advances creates an extremely dangerous situation forcing the employee to resign immediately. Finally, the Seventh Circuit (Robinson v. Sappington, 2003 U.S. App. LEXIS 24723, 7th Cir., December 2003) would permit a constructive discharge to qualify as a tangible employment action only after distinguishing between actions by the victim's supervisors (included) and actions by his/her coworkers (excluded).
The Supreme Court can answer questions left open in Faragher and particularly in Ellerth. There, after drawing a careful distinction between tangible employment actions caused by supervisors (automatic vicarious employer liability) and hostile work environments caused by supervisory actions (vicarious employer liability but subject to an affirmative defense), the Court sought to provide content for the key phrase "tangible employment action." It required a "significant change in employment status" that "inflicts direct economic harm." The Court then gave illustrations ("such as hiring, firing, failing to promote, reassignment with significant different responsibilities, or a decision causing a significant change in benefits.")
Constructive discharge was not a listed illustration in Ellerth, even though Kimberly Ellerth claimed she had been constructively discharged. Kimberly was a salesperson in a two-person Chicago office where the other person was her immediate supervisor. Kimberly claimed another supervisor, located in the company's New York City office, harassed her with comments and threats. She could not cite any tangible employment actions and, indeed, was promoted during her short fourteen-month employment period. Kimberly did not complain to her immediate supervisor despite knowing Burlington had an antiharassment policy. She testified she had not complained because, if she had, her supervisor would have been obligated to report the harassment to his superiors. Kimberly resigned suddenly just after her immediate supervisor warned her to return customers' calls more promptly. Her weak constructive discharge claim was dismissed by the district court.
Burlington argued that it didn't know about the harassment because Kimberly never complained. The Supreme Court specifically noted that Kimberly "has not alleged she suffered a tangible employment action at the hands of [her supervisor's supervisor]" even though, as noted, she alleged constructive discharge in her initial complaint. The Court also specifically observed that, under its new rule, Burlington would be deprived of the affirmative defense if Kimberly had alleged a tangible employment action. Because one had not been alleged, Burlington could still be found vicariously liable but, the Court held, "should have the opportunity to assert and prove its affirmative defense." The case was remanded to give Burlington that opportunity.
The Ellerth Court gave us other clues as to what types of supervisory decisions would qualify as tangible employment actions. The authority of the employer itself must be implicated in a meaningful way, since " a tangible employment decision requites an official act of the enterprise, a company act." The Court continued: "[I]n most cases [that decision] is documented in official company records, and may be subject to review by higher level supervisors [and] the supervisor must obtain the imprimatur of the enterprise and use its internal processes." These strict requirements make sense in the context of a supervisor's discharge decision but not in the context of an employee's resignation decision followed by a claim of constructive discharge. The resignation is the employee's act not the company's. It will usually be documented in company records only as a resignation, a common personnel event. It will not necessarily be reviewed by higher level supervisors nor would that resignation, once accepted, require "formal approval of the enterprise."
Constructive discharges and tangible employment actions are fundamentally different concepts. They should not be conflated. The standards are different. A constructive discharge requires intolerable working conditions more egregious than the high "severe or pervasive" standard applicable to hostile work environments. This higher standard is purposeful because an employee is expected to remain employed in the face of increasingly difficult working conditions and, as the Third Circuit itself noted in Suders, to explore alternative avenues thoroughly before concluding resignation is the only option.
Additionally, as the Second Circuit noted in Caridad, a constructive discharge can be prompted by actions by supervisors and by coworkers together. Ellerth focuses exclusively on supervisory actions because employers are not vicariously liable for unknown coworker harassment. The courts that insist on tying constructive discharge to tangible employment actions must concede, as the Seventh Circuit did in Robinson, that all coworker contributions to a constructive discharge must be filtered out. A simpler approach would separate the two concepts. Constructive discharge, if proven, should only mean constructive discharge has been proven and appropriate remedies should be provided. It does not have to spill over into the separate hostile work environment analysis and deprive an employer of its affirmative defense.
This is particularly true since the burdens of proof differ. Employees have the burden of proving a constructive discharge. Employers have the burden of proving their affirmative defense. Separating the two concepts so that each stands on its own also avoids the "complex" proof problems described by the Third Circuit in Suders whereby evidence of employee complaints about potentially intolerable working conditions or about a severe or pervasive hostile work environment overlap. The "substantial risk" noted by the Third Circuit that constructive discharge evidence can "become a back door" for the introduction of affirmative defense evidence is easily avoided if the two legal concepts are each judged by their own standards.
Allowing constructive discharge to deprive an employer of its affirmative defense disturbs the Supreme Court's careful distinctions in Ellerth. Employees alleging hostile work environment harassment must prove the harassing individuals are supervisors. Ellerth's vicarious liability rules are based on the key premise that supervisory harassment is made possible by the abuse of supervisory authority vested in certain individuals by the employer. It is only because supervisors are aided in accomplishing the harassment by the existence of the agency relationship that employers are held vicariously liable.
In Suders, two of the three alleged supervisors were basically coworkers. One (Prendergast) "shared some supervisory authority." Another (Baker, the worst offender) allegedly had "a supervisory role," as did all other police corporals. Ms. Suders admitted the Pennsylvania State Police Headquarters was not aware of the harassment she experienced during her brief five-month employment at the McConnellsburg barracks. The State Police argued unsuccessfully that the individuals harassing Ms. Suders did not have "requisite authority" to commit a tangible employment action because they could neither fire nor demote her. Whether these individuals were or were not supervisors drops out of the picture once constructive discharge becomes a tangible employment action. Neither hostile work environment harassment nor the special affirmative defense can coexist with a tangible employment action.
The district court in Suders held the State Police successfully asserted their affirmative defense. They had a sexual harassment training program in place. Indeed, Ms. Suders met the female EEO officer when she took that training two months before her sudden resignation. She did not complain about either her allegedly intolerable working conditions or harassment at that time. Her first and only complaint to this EEO officer occurred only two days before she resigned by submitting a completed resignation form she had been carrying around with her. The Third Circuit's willingness to allow a constructive discharge claim to impose strict vicarious liability on the State Police rendered this admitted noncomplaint irrelevant. Of course, the Supreme Court in Ellerth crafted the affirmative defense for the purpose of encouraging employees being harassed to report that harassment to their employer. If employer liability attaches as soon as constructive discharge is found, this important Supreme Court policy initiative is frustrated.
In sum, employers hope the Third Circuit is reversed and the Supreme Court uncouples constructive discharge and hostile work environments. Each should stand on its own. If the facts of a case prove the employee was forced to resign by intolerable working conditions, constructive discharge should be found and remedied. If the facts show supervisory actions created a hostile work environment, that should be found and remedied but the employer must then have the opportunity provided by Ellerth to prove its affirmative defense. Expanding vicarious employer liability through the elevation of constructive discharge to a tangible employment action upsets the careful balance of employer/employee rights and obligations announced in Faragher and Ellerth.