• Since supervisors are representatives of the company, a company can be held liable for the actions of its supervisors.

The extent to which an employer is liable for acts of sexual harassment by supervisors was decided in two Supreme Court cases, Faragher v. City of Boca Raton, 524 U.S. 775 (1998) and Burlington Industries v. Ellerth, 524 U.S. 742 (1998). These cases decided that an employer is vicariously liable for the acts of its supervisors.

The Court held that where the harassment results in a “tangible employment action,” such as termination, demotion, or undesirable reassignment, the employer would be held liable for the actions of its supervisor, even if the employer was unaware of the conduct (because supervisors are representatives of the company).

If no tangible employment action occurs, an employer may raise an affirmative defense if it satisfies these two requirements:

1. The company must show it exercised reasonable care to prevent and promptly correct any sexually harassing behavior once it became aware of it, and
2. The company must show that the employee unreasonably failed to take advantage of any preventative or corrective opportunities provided by the employer (such as following a stated sexual harassment complaint reporting policy).