By Anne R. DanaNila Merola, and Robert S. Whitman

Seyfarth Synopsis: In compliance with legislation passed earlier this year, New York State has released the final model sexual harassment policy and complaint form, the model training materials, and FAQs, which provide further guidance regarding the legislation. Two significant clarifications to the draft guidance issued several weeks ago are (1) the deadline for completion of employee anti-harassment training is October 2019, not January 2019, and (2) new employees must receive training “as soon as possible,” rather than within 30 days of hire.

Earlier this year, New York State enacted comprehensive legislation targeting workplace sexual harassment. Our previous Management Alerts outlining the various requirements under the law are linked here and here. On August 23, 2018, Governor Andrew Cuomo released a draft model policy and draft model internal complaint form, a draft training script, and draft FAQs. All of those draft documents were subject to public comment. On October 1, 2018, the State issued the final documents. This Alert highlights the key differences between the drafts and the final versions and consolidates the new requirements under the State law in one place.

As background, the law requires the Department of Labor and Division of Human Rights to create a model sexual harassment prevention policy and a model sexual harassment prevention training program. Those agencies have now done so: the model policy and the model training program is available here. Employers must either adopt the model policy and training program, or establish a policy and training program that equals or exceeds the minimum standards provided by the models. The sexual harassment policy must also include a complaint form for employees to report internally alleged incidents of sexual harassment (the model is available here). Below are further details about these requirements.

Policy and Complaint Form

Beginning on October 9, 2018, all employers must distribute to all New York State employees a sexual harassment prevention policy and a complaint form that employees can use to report inappropriate conduct.

For employers that opt to create their own policies, the policy must: (1) prohibit sexual harassment consistent with guidance issued by New York State; (2) provide examples of conduct that constitutes sexual harassment; (3) clearly state that sexual harassment is considered a form of employee misconduct and that disciplinary action will be taken against individuals engaging in sexual harassment and against supervisors or managers who knowingly allow such behavior to continue; (4) clearly state that retaliation against individuals who complain of sexual harassment or who testify or assist in any investigation or proceeding involving sexual harassment is unlawful; (5) include an internal complaint form that employees can use to report conduct that they believe is sexual harassment; (6) explain that complaints of sexual harassment will be investigated promptly and that the investigations will be as confidential as possible and that the rights and interests of all parties will be protected; (7) include information concerning the federal and state laws that prohibit sexual harassment, remedies available to victims of sexual harassment, and a statement that there may be applicable local laws; and (8) inform employees of their right to file a complaint with the New York State Division of Human Rights, the Equal Employment Opportunity Commission, federal or state court, or a local police department.

The final FAQs (available here) offer additional guidance for employers. Specifically,

  • Distribution: The policy must be provided to employees in writing or electronically. If the policy is made available on a work computer, employees must be able to print a copy.
  • Contractors & Non-Employees: The policy does not have to be distributed to contractors and other non-employees. However, because the State Human Rights Law has been extended to cover non-employees who bring sexual harassment claims, employers are “encouraged” to provide the policy to non-employees and anyone providing services in the workplace.
  • Complaint Form: The complaint form does not need to be included in full in the policy, but the policy should be clear about where the form may be found (g., on an internal website).
  • Investigation Procedure: The policy must describe the employer’s internal investigation procedure. The investigation procedure does not, however, have to be identical to the investigation procedure set forth in the State’s model policy.
  • Acknowledgment of Receipt: Employers are not required to obtain or keep a signed acknowledgment that an employee has read the policy, but are encouraged to do so.
  • Languages: The policy must be provided to employees “in the language spoken by their employees.” The State will publish additional model policy and complaint forms in Spanish, Chinese, Korean, Bengali, Russian, Italian, Polish and Haitian-Creole. When a model is not available in an employee’s language, employers may provide that employee with an English version.
  • New Employees: New employees should receive a copy of the policy prior to commencing work.
  • Optional Poster: The State also issued an optional Sexual Harassment Prevention Policy Notice, which is a poster that employers may display in the workplace. The poster simply directs employees and non-employees to the employer’s sexual harassment prevention policy. Posting the State’s Notice is optional. A Microsoft Word version is available here.

Training

The New York State law also requires employers to provide all employees with annual, interactive sexual harassment prevention training. In a key difference between the draft and the final FAQs, the deadline for complying with the training requirement has been extended to October 9, 2019 (previously, it was January 1, 2019). Moreover, employers are no longer required to train new employees within 30 days of hire, but rather are encouraged to provide training “as soon as possible.” The practical effect of these changes is that many employers will likely want to wait to conduct sexual harassment training until after the New York City law goes into effect on April 1, 2019. Our prior Alerts on the New York City law are available here and here.

For employers that choose to create their own training rather than adopt the State’s model, the training must be interactive and include all of the following: (1) an explanation of sexual harassment consistent with State guidance; (2) examples of conduct that is considered unlawful sexual harassment; (3) information about federal and state laws covering sexual harassment and available remedies; (4) information regarding the employer’s procedure for the timely and confidential investigation of complaints, including the specific name(s) of appropriate personnel and location to submit complaints; (5) information addressing supervisor conduct and additional responsibilities of supervisors; (6) an explanation of how to raise sexual harassment complaints with government agencies and courts; and (7) prohibitions on retaliation with examples.

Additional guidance as set forth in the final FAQs regarding sexual harassment training is as follows:

  • Annual: Employees must receive training annually, which can be based either on the calendar year, anniversary date of each employee’s start date, or any other date the employer chooses.
  • Who must be trained: All workers, regardless of immigration status, including exempt and non-exempt employees, part-time workers, seasonal workers, and temporary workers, must be trained. Non-employees, such as third-party vendors, contractors, volunteers, or consultants do not need to be trained. Employers may deem the training requirement satisfied for new employees who received compliant training from a prior employer in the past year if the new employee can verify completion through a previous employer or a temporary help firm.
  • Interactive: The FAQs offer the following examples of trainings that would meet the “interactive” requirement: (i) if the training is web-based, it has questions at the end of a section and the employee must select the right answer; (ii) if the training is web-based, the employees have an option to submit a question online and receive an answer immediately or in a timely manner; (iii) for in-person training, if the presenter asks the employees questions or gives them time throughout the presentation to ask questions; and (iv) the training provides a Feedback Survey for employees to turn in after they have completed the training. An training in which the individual only watches a video or reads a document, with no feedback mechanism or interaction, is not considered interactive.
  • Languages: Employers must provide training to employees “in the language spoken by their employees.” The State will publish model training materials in Spanish, Chinese, Korean, Bengali, Russian, Italian, Polish and Haitian-Creole. When a model is not available in an employee’s language, employers may provide that employee with training in English.
  • Records: Employers are not required to maintain copies of training records, but are encouraged to do so.
  • Duration: There is no specific time requirement for the length of the training.
  • Time and Payment for Training: Any training time must be counted as regular work hours.

Non-Disclosure Agreements Involving Claims of Sexual Harassment

As of July 11, 2018, New York employers have been prohibited from including an NDA in any settlement of a claim involving sexual harassment that would prevent the person who complained from disclosing the underlying facts and circumstances of the harassment, unless the complainant requests confidentiality.

The final FAQs clarify that the law will not operate like the analogous provisions of the Older Workers Benefit Protection Act. Specifically, waivers cannot be included in settlement agreements that can be presented and executed on the spot in a single document. Rather, if the complainant requests confidentiality, the terms must first be provided to all parties; the complainant must have 21 days to consider the provision; and, after 21 days, if confidentiality is still the complainant’s preference, the provision must be memorialized in a separate agreement signed by all parties. The complainant then has 7 days to revoke the agreement, which shall not be effective or enforceable until the revocation period expires. The 21-day review period is not waivable, so it cannot be shortened, even if the complainant so desires. The FAQs also clarify that there must be two agreements: (1) an agreement that memorializes the preference of the person who complained, and (2) the settlement agreement itself.

As always, Seyfarth Shaw attorneys are available to assist with any questions or concerns you have regarding the New York State Sexual Harassment Laws.

By Rashal G. Baz, Katherine Mendez, and Chelsea D. Mesa

Seyfarth Synopsis: Employers are now being presented with more options to outsource workplace complaints through third party companies and mobile apps. This may create an ease in grievance reporting for the employee, but does not necessarily shield employer liability.

Harassment in the workplace is not a novel issue, but with the rise of national and global movements such as #MeToo and Time’s Up — it has been on the forefront of our social, political and business conversations. Hollywood has cast a spotlight on sexual harassment and the sometimes imperfect protocols in place to address concerns. These issues are appearing in the headlines, TV shows, and social media platforms with the potential impacts of destroying a company’s goodwill and bottom line.

In response to this outcry and several industries’ spotting an opportunity to get involved, the technology-driven community has responded with mobile apps, anonymous grievance non-profit websites, new third-party consulting companies, and modernized hotline services. The goals of these new technologies and strategies is to heed complaints and optimize an employer’s response.

The Current State of Things

Before touching on the reporting outlets, it is critical to understand why a demand for such services exist. Historically, there have been studies that note the resistance to workplace harassment reporting. This could be attributed to a fear of employer retaliation, unwanted peer attention, distress in confronting a perpetrator or lack of trust in workplace changes following such a complaint. Sometimes employees simply do not know or recall where to find the protocol for filing harassment incidents. These are among the reasons the Equal Employment Opportunity Commission and other organizations shine a close light on the response procedures employed by a company.

Many employers use a host of different practices designed to make reporting as simple and effective as possible. These range from traditional reporting to a supervisor or HR in writing or in person, to the use of a designated ombudsman, email submissions and hotline phone numbers. The goal is to encourage the reporting of complaints, so they can be resolved.

A New Twist on Reporting

Mobile Applications: Glued to our phones, it only follows that harassment and employment complaint apps have been created for the workforce. When reporting an issue is easy and familiar, it stands to reason that more information will be transmitted to the business. One example app uses a subscription-based service employers can purchase and integrate into internal procedures. The app allows workers to identify themselves and their location or remain anonymous and pick from different pre-set messages to indicate the nature and severity of the concern. These apps also allow an employee to include documents, images or videos that are sent to their choice of two to four default managers who will receive the correspondence. These services claim to provide a safe space for raising concerns, free from external interference.

Consulting Groups: Third-party consulting groups have also responded to the need for something new by creating company-specific online environments where employees can file complaints. In turn, the consultants will assess the complaint, write an action plan on what type of investigation is needed, and provide an external “expert” to do a workplace investigation for inappropriate behavior. These companies tout experienced personnel that investigate the issue while avoiding the purported “inherent bias” human resources personnel may hold toward the complainant or accused employee.

Hotline Services: Outsourced workplace harassment and discrimination hotline services are not new, but seemed to have stepped up their game as well. Typically, hotlines provide a company-specific phone number, voicemail box and email address where employees can voice grievances. Instead of merely transmitting the collected data to employers, the third-party services are now also offering more involvement in employee complaints. Several now offer to have “experienced” human resource professionals produce a report that allows the employer to handle the issue internally, or chose an external route to be handled by a “team of experts,” similar to the aforementioned consulting process.

Will This Help My System?

While additional reporting processes can be beneficial to obtaining data and addressing complaints, using an external service does nothing to change any of the employer’s obligations. If an employer’s practices and implementation of strategy aren’t already strong, implementing the “hot new thing” would simply serve as a rearrangement of chairs on the deck of the Titanic, and not really solve much. In considering whether to add this to its arsenal, employers would have to trust that the individuals involved with their complaints are, in fact, qualified to handle them. Failures along the way will still fall on the shoulders of an employer.

An employer’s uniform response to delicate situations can help defend against retaliation claims stemming from harassment reports; however, it is difficult to remember, and thus repeat, how you responded to a previous situation without accessible and thorough documentation. Outsourcing the complaint to a third-party technology may assist in providing a platform employers can reference when handling a new grievance. However, these services can also expose employers to cybersecurity issues. This false sense of security can end in costly litigation if you do not audit these services on an annual basis. Complaints lost in the cloud will result in claims against employers, not the app.

These external systems also do not address the alleged “bias” concern plaintiffs often argue exist. These systems would still be contracted and paid for by the employer, who will have likely partnered with the third party to set up the system. And as the third party works with the employer over time and learns its business, a relationship between the parties (and a desire to keep the employer happy so the relationship continues) will likely develop. It is unclear how a third party will avoid the same arguments of bias that an internal process will face. This further rings true because the relationship’s collaborative nature still has the employer making the ultimate decision on next steps in response to a complaint.

On the flip side, employers who choose not to utilize such services may not be out of reach of their effects. There are organizations creating anonymous hotlines that allow employees from any company to submit a report that in turn is “instantly” sent to who they deem the appropriate individuals within the complainant’s organization. And Silicon Valley has created smartphone apps that allow employees to anonymously report an incident to the company’s chief executive and board. This places the burden on those who receive these complaints, who may not be the person within an organization able to respond quickly enough, to send them through the proper channels. Even though these systems may provide another means for employees to feel as though they have raised a concern, there is no guarantee it gets into the company and to someone who can address it.

The Takeaways

There have been many assessments on how to minimize incidents of harassment and create a zero-tolerance environment for such scenarios. Initially, these new systems may seem like the right solution, but if you are integrating protocols that are not followed by the head of the company to the grassroots, a palpable workplace change and a legally sound grievance procedure is unlikely.

The benefit of these outlets include the creation of additional accessible channels workers may feel safe utilizing, but does not guarantee the complaint gets in the hand of the person who has the power to address it. Using a third party to assess complaints may avoid alleged HR biases in theory, but the company’s relationship with the service and ultimate decision-making ability weakens the practicality of that benefit.

These resources may represent the future of reporting and thus require employers to proactively adopt policies and training to avoid being blindsided by their arrival. Ultimately, the release of numerous online lists pointing out sexual harassment perpetrators and the rise in anonymous direct-to-company complaints may create an ethical duty to prepare your staff on how to process the information. Should you chose to contract these grievance reporting services, it would be wise to conduct internal training on how to utilize it and what human resources/supervisors should do when they receive notice of a complaint. Finally, evaluate and update your workplace harassment and reporting policies.

Ensure your company has the internal knowledge it needs to react when the time comes. And always feel free to reach out to your favorite Seyfarth employment lawyer for guidance on how to implement and maintain the most effective and appropriate processes as we march toward the future of harassment reporting.

For more information on this topic, please contact the authors, your Seyfarth Attorney, or any member of Seyfarth Shaw’s Workplace Policies and Handbooks Team or the Labor & Employment Team.

By Paul S. Drizner and Michael D. Fleischer

Seyfarth Synopsis: The new Tax Act prohibits employers from deducting payments to individuals alleging sexual harassment or sexual abuse if the settlement or payment requires the Claimant to execute a nondisclosure agreement.

The #MeToo movement continues to have a significant impact on all employers, forcing human resource professionals to review their protocols for preventing, reporting and investigating sexual harassment claims. Now, Congress has passed the Tax Cuts and Jobs Act (the “Tax Act”), which may make sexual harassment settlements more expensive for employers who seek to keep these settlements private.

Under current tax law, an employer may deduct the ordinary and necessary expenses it incurs in carrying on its trade or business. This deduction generally includes legal settlements or payments to a plaintiff (including plaintiff’s attorney fees) and any legal fees the employer has incurred for its defense.

There has been an outcry by high profile victims’ advocates who have characterized confidentiality payments in settlements as “hush money” arguing that they mask inappropriate corporate conduct. In response, Congress included a provision in the Tax Act which is aimed directly at deterring employers from using nondisclosure agreements in sexual harassment settlements. Pursuant to new Internal Revenue Code Section 162(q), the government will no longer permit employers to deduct  “any settlement or payment related to sexual harassment or sexual abuse if such settlement or payment is subject to a nondisclosure agreement” or “attorney’s fees related to such a settlement or payment.”

Implications and Challenges

New Section 162(q) has important implications for employers but there remain a number of questions regarding its application.   We expect the IRS to issue guidance in the future which will clarify some of the current ambiguities, but employers must devise a plan now for new legal settlements since Section 162(q) applies to payments made after December 22, 2017.

First, the price for confidentially just increased. When an employer settling a sexual harassment claim includes a nondisclosure provision in the agreement, it will be unable to deduct any payments related to the matter, including the settlement payment and attorney’s fees. This may backfire on the Plaintiff’s Bar, because there are certainly instances where the plaintiff desires confidentiality for a variety of reasons, including that publication of the agreement may make it more difficult for the plaintiff to find another job. In cases where the plaintiff desires confidentiality more than the employer, the employer may use this leverage to lower its settlement offer, essentially charging the plaintiff for the additional cost of confidentiality.

Second, the broad language of the statute makes it uncertain whether the IRS will consider payments made pursuant to a confidential agreement that does not settle sexual harassment claims but which contains a broad waiver of claims, including for sexual harassment, as “related to sexual harassment” and, thus, preclude the deduction. Unfortunately, we do not know the answer yet. Until this issue is clarified, employers may want to consider adding a provision to their settlement agreements by which the parties acknowledge that even though the claimant is waiving a broad range of potential claims, there was no claim of sexual harassment or sexual abuse and none of the settlement payments are related to such claims.

It is also unclear exactly which deductions the IRS is precluding in connection with the confidential settlement of a sexual harassment claim. The statute is clearly intended to apply to the settlement payment itself, as well as attorney’s fees. But what about other payments? If an employer hires an investigator or expert to assist with its case, are those costs deductible? What if the employer provides outplacement services for the plaintiff or pays the plaintiff’s COBRA premiums, are those costs deductible? Finally, if an employer has Employer Professional Liability Insurance and the insurance carrier makes the settlement and/or attorney’s fees payment, will the insurance company be denied a deduction for those payments? These are questions that will hopefully be answered with future official guidance. Plaintiffs often bring sexual harassment claims along with other discrimination claims like age and race. We will need the IRS to clarify whether a portion of the settlement may be allocated to sex harassment, so that the employer may deduct remaining payments.

Third, the statute explicitly provides that attorney’s fees related to the confidential settlement of a sexual harassment or sexual abuse matter are not deductible. This provision creates separate implications for both plaintiffs and employers.

We read the new statute to prohibit any deduction for an employer’s own attorney’s fees incurred for defense, or the payments made to the plaintiff’s attorneys. The provision would also seem to prohibit a plaintiff from deducting any attorney’s fees the plaintiff pays to his or her attorneys.   A plaintiff has income if the employer pays his or her attorney’s fees. In the past, a plaintiff was generally allowed to deduct the amount of the plaintiff’s attorney’s fees that the employer paid, resulting in no net income to the plaintiff for the attorney’s fees. The broad language of new Section 162(q) appears to change that general rule and prohibit a plaintiff from deducting the attorney’s fees the employer paid.   As such, the plaintiff may now owe tax on income that the plaintiff never received and this will significantly reduce his or her net recovery.

Although it is unlikely that Congress intended to place a tax burden on plaintiffs who raise sexual harassment claims, there is no clear guidance on these issues. As a result, until the IRS issues further clarification, plaintiffs may look to employers to cover their additional tax liability, which will add to the cost of settlement and make negotiations more difficult.

The result of all of this is that employers will have to carefully evaluate the cost/benefit of confidentiality. It will remain important to continue to monitor developments concerning the new tax law and incorporate the issues discussed above into the legal and financial analysis when settling cases involving sexual harassment or sexual abuse.

Seyfarth Shaw will provide further alerts as new developments occur.

For more information on this topic, please contact the authors, your Seyfarth Attorney, or any member of Seyfarth Shaw’s RetailTax, or Labor & Employment Teams.

By Marjorie Clara Soto, Kay J. Hazelwood, and Mary Kay Klimesh

Seyfarth Synopsis: The U.S. Court of Appeals for the Tenth Circuit’s recent opinion in Yeasin v. Durham, No. 16-3367, 2018 WL 300553 (10th Cir. Jan. 5, 2018), addresses the “tension between some students’ free-speech rights and other students’ Title IX rights to receive an education absent sex discrimination in the form of sexual harassment.” The Court of Appeals did not specify a test to be applied when a student’s alleged First Amendment right to free speech intersects another student’s alleged right to be free from harassment in a university community, but did affirm the district court’s decision that a KU administrator did not violate clearly established law when she expelled Yeasin for misconduct related to an off-campus incident and tweets.

The court specifically refrained from deciding “whether Yeasin had a First Amendment right to post his tweets without being disciplined by the university.” The Court’s analysis in this case is of particular interest to public colleges, universities and schools who grapple with managing and balancing student First Amendment rights and the responsibility to maintain an educational environment free from harassment.

Background and Procedural History

In November, 2013, Dr. Tammara Durham, Vice Provost for Student Affairs, made a decision to expel Navid Yeasin from the University of Kansas (“KU”) after her review of a hearing panel’s findings of fact based on a preponderance of the evidence that Yeasin had violated KU’s sexual harassment policy by engaging in conduct which included posting off-campus social media tweets making derogatory statements about his ex-girlfriend’s body, but not naming her.

Yeasin proceeded to contest the expulsion in Kansas state court which concluded that the findings, adopted by Dr. Durham, “were not supported by substantial evidence” and that “KU and [Dr.] Durham erroneously interpreted the Student Code of Conduct by applying it to off-campus conduct.” KU appealed, arguing that its interpretation of KU’s Code of Conduct was “consistent with the obligations imposed on it under Title IX” and allowed for the University to expel Yeasin since its student code allowed for students to be punished for off-campus conduct that violates federal, state, or local law. In September 2015, that court affirmed the lower state court’s findings and Yeasin subsequently re-enrolled at KU.

Thereafter, Yeasin brought suit in federal court against Dr. Durham under 42 U.S.C. Section 1983 alleging her action to expel him from KU for the content of his on-line, off campus speech violated his First Amendment right to free speech and his Fourteenth Amendment right to substantive due process. He sought monetary damages claiming that KU’s wrongful expulsion delayed completion of his education, cost him lost employment and wages, and caused him emotional distress and mental anguish. Dr. Durham moved to dismiss both of Yeasin’s claims on qualified-immunity grounds. The federal district court granted Dr. Durham’s motion to dismiss, concluding that she did not violate Yeasin’s clearly established rights under the First and Fourteenth Amendments. On January 5, 2018, the Tenth Circuit Court of Appeals affirmed.

The Tenth Circuit Court of Appeals Analysis and Findings

Qualified immunity protects government officials from liability for civil damages if their conduct “does not violate clearly established statutory or constitutional rights of which a reasonable person would have known.” In order to overcome this defense, a plaintiff must show (1) that the official violated a statutory or constitutional right, and (2) that the right was clearly established. The Court of Appeals here found that Yeasin’s claim failed the second prong of this analysis.

In reaching its conclusion, the Court analyzed free speech cases in secondary school and college/university settings including consideration of Tinker v. Des Moines Indep. Community Sch. Dist., 393 U.S. 503 (1969) (finding that, while secondary-school students retained free-speech rights, schools can still prohibit actions that “would materially and substantially disrupt the work and discipline of the school…”); Morse v. Frederick, 551 U.S. 393 (2007) (allowing a K-12 school to discipline a student for flying a banner reading “BONG HiTs 4 JESUS” at an off-campus, school-approved activity because the banner could reasonably be viewed as promoting drug use); Bethel Sch. Dist. No. 403 v. Fraser, 478 U.S. 675 (1986) (K-12 schools can restrict lewd, vulgar, or indecent speech even without a forecast of disruption); and Hazelwood Sch. Dist. v. Kuhlmeier, 484 U.S. 260, 273 (1988) (allowing public officials to restrict K-12 school-sponsored speech).

Yeasin argued that First Amendment cases which allow for the restriction of student speech in the secondary school context cannot be applied in the university context in the same way. Rather, Yeasin argued that cases including Papish v. Bd. of Curators of the Univ. of Missouri, 410 U.S. 667 (1973) (addressing distribution of newspaper in the university setting “containing forms of indecent speech”); Widmar v. Vincent, 454 U.S. 263 (1981) (addressing a university’s refusal to allow a registered religious student group to meet in university buildings); and Healy v. James, 408 U.S. 169 (1972) (addressing a state college’s refusal to officially recognize a student group known because of its potential affiliation with a national organization known for campus disruption) should be applied. The Tenth Circuit Court of Appeals distinguished the cases advanced by Yeasin noting that the cases didn’t concern “university-student conduct that interferes with the rights of other students or risks disrupting campus order.” The Court also countered with language from Widmar, quoting Healy, which “suggests that the Supreme Court believes that the material-and-substantial-disruption test applies in the university setting.” Ultimately, the Tenth Circuit Court of Appeals concluded that Yeasin could not establish that Dr. Durham had violated clearly established law when she took action to expel him, in part, for his off-campus social media tweets.

The Court considered Yeasin’s substantive due process argument, and found that it was flawed. The Court reasoned that Yeasin needed to show that the school’s decision to expel him was arbitrary, lacked a rational basis, or shocked the conscience. Butler v. Rio Rancho Pub. Sch. Bd. of Educ., 341 F.3d 1197, 1200 (10th Cir. 2003). The court declined to resolve the question of whether Dr. Durham’s decision to expel Yeasin violated his right to substantive due process, and limited its opinion to a finding that she violated no clearly established law in doing so.

The need for college and university administrators and school officials to navigate their legal obligations when addressing decisions to discipline a student for off-campus speech on social media will no doubt remain a prevailing issue, especially when such conduct implicates the rights of another student to be educated in a harassment-free learning environment. Not surprisingly, KU modified its student code of conduct after this incident to explicitly extend its disciplinary jurisdiction to off-campus incidents.

Seyfarth Shaw continues to monitor the developments in the battle between the First Amendment right to freedom of speech and rights under Title IX to an educational environment free of sexual harassment. We will keep our readers apprised.

For more information on this topic, please contact the authors, your Seyfarth Attorney, or any member of Seyfarth Shaw’s Workplace Policies and Handbooks Team or the Labor & Employment Team.

By Uma Chandrasekaran, Kyle Petersen, and Megan P. Toth

Seyfarth Synopsis: In this February 1, 2018, hot-topic webinar, we will provide a roadmap for conducting legally compliant and effective sexual harassment investigations. There is no cost to attend this program, but registration is required.   

Over the past few months, news headlines have been dominated by sexual harassment allegations involving high profile celebrities. Sexual harassment in the workplace, however, is not limited to Hollywood and cuts across all industries. How an organization responds to allegations of workplace harassment can have significant impact, legally and culturally.

The time is right to revisit your company’s plan for responding to internal complaints. A critical component of that plan is being prepared to conduct effective and defensible investigations. This webinar will provide best practices for responding to and investigating workplace harassment complaints.

Be sure to register if you wish to attend this webinar. It will take place at 12:00 pm CT/1:00 pm ET. If you have any questions, please contact events@seyfarth.com.

By Uma Chandrasekaran and Kyle Petersen

Seyfarth  Synopsis: In this February 1, 2018, hot-topic webinar, we will provide a roadmap for conducting legally compliant and effective sexual harassment investigations. There is no cost to attend this program, but registration is required.   

Over the past few months, news headlines have been dominated by sexual harassment allegations involving high profile celebrities. Sexual harassment in the workplace, however, is not limited to Hollywood and cuts across all industries. How an organization responds to allegations of workplace harassment can have significant impact, legally and culturally.

The time is right to revisit your company’s plan for responding to internal complaints. A critical component of that plan is being prepared to conduct effective and defensible investigations. This webinar will provide best practices for responding to and investigating workplace harassment complaints.

Be sure to register if you wish to attend this webinar.   It will take place at 12:00 pm CT/1:00 pm ET.  If you have any questions, please contact events@seyfarth.com.

By Steve Shardonofsky and Brian A. Wadsworth

Texas Law Legal System ConceptSeyfarth Synopsis:  In a decision that is sure to increase the costs and complexity of litigation, the Texas Supreme Court recently held that a former employee’s common law assault claim was not preempted by the state’s anti-discrimination statute. The Court reasoned that if the gravamen of an employee’s claim is that the employer committed assault through a “vice principal”–as opposed to sexual harassment–the employee may pursue the common law claim directly and would not be preempted.

Recently, in B.C. v. Steak N Shake Operations, Inc., the Texas Supreme Court held that an employee could sue her employer for assault where the gravamen of the claim was sexual assault by the employer’s “vice principal”, and not sexual harassment. In doing so, the Court narrowed its previous holding in Waffle House, Inc. v. Williams, 313 S.W.3d 796 (Tex. 2010) that common law torts predicated on the same or similar facts as a sexual harassment claim are preempted by the Texas Commission on Human Rights Act (“TCHRA”).

In a somewhat bizarre twist of logic, the decision suggests that employees subject to a single, severe instance sexual assault by a “vice principal” may bring a common law claim against the employer; but employees subject to a pattern sexual harassment involving sexually suggestive comments and conduct (including less violent or offensive touching constituting assault) may only bring a claim under the TCHRA (subject to administrative exhaustion requirements and damages caps). Until the courts resolve this open question, employers will likely be forced to defend both types of claims at the same time, while also having to litigate factually-intensive questions regarding who qualifies as a “vice principal” under Texas law.

Plaintiff B.C. worked as a server in the Steak N Shake restaurant in Frisco, Texas. During a shift in October 2010, she claimed that her supervisor assaulted her in the bathroom, pushing her against the wall and sink, groping her, and exposing his genitals. She was able to escape the attack only after the supervisor lost his balance and fell to the ground. Steak N Shake conducted an internal investigation after B.C. reported the incident, but was unable to confirm B.C.’s story. Steak N Shake extended an unqualified offer to B.C. to return to work at any Steak N Shake location of her choosing. B.C. declined the offer and instead resigned. She later sued Steak N Shake for a variety of common law claims, including assault, on the basis that her supervisor was a “vice principal” and therefore Steak N Shake was directly liable for his tortious actions. Steak N Shake moved for summary judgment arguing, in part, that the TCHRA preempted B.C.’s common law claims. The trial court granted summary judgment without explanation and B.C. appealed. The Dallas Court of Appeals, relying on Waffle House decision, affirmed the trial court’s ruling on the grounds that the TCHRA preempted B.C.’s assault claim.

In reversing, the Texas Supreme Court distinguished the facts in Waffle House, noting that the plaintiff in that case (Williams) had asserted a common-law negligent retention and supervision claim based on the employer’s alleged failure to prevent a pattern of sexual harassment by co-workers over six months that included inappropriate comments, suggestive winks, and arguably sexual assault (the employee allegedly held the plaintiff’s arms with his body pressed against hers and rubbed against the plaintiff’s breasts with his arms). Because sexual harassment under the TCHRA based on co-workers harassment is predicated on the employer’s alleged negligence and because it was the employer’s continued negligent supervisor and retention of the harasser that constituted the factual basis of Williams’ claims, the Texas Supreme Court held in Waffle House that the gravamen of the Williams’ complaint was a TCHRA-covered claim and not the negligence claims.

The Court then distinguished its holding in Waffle House from the claim raised by B.C. First, the factual basis for Williams’ common law claim in Waffle House was Waffle House’s continued supervision and retention of the harasser. B.C., on the other hand, only alleged a single instance of violent assault. Second, the Court reasoned that Williams improperly repackaged the assault portions of her sexual harassment claim in terms of negligence. Yet the gravamen of her complaint was sexual harassment by co-workers. Conversely, unlike Williams, B.C. did not allege a pattern or practice of sexual harassment by co-workers. Instead, she alleged that on a single occasion, Steak N Shake, acting through her supervisor, sexually assaulted her. Third, Williams alleged that a co-worker physically harassed her, whereas B.C. alleged that her employer was directly responsible for the alleged assault of a “vice principal” (i.e., her supervisor). Therefore, the Court reasoned, the gravamen of B.C.’s complaint was assault, not sexual harassment under the TCHRA. The Court also noted that there is no indication that the Texas legislature intended for the TCHRA to preempt assault claims against individual assailants (whether a corporate entity or an individual).

The Court’s holding here is likely to cause confusion and lead to strange outcomes. With little guidance, courts will be forced to decide whether the gravamen of a complaint is assault or sexual harassment. Because the Court did not draw a bright line, employees subject to a pattern of non-physical harassment and only one incident of assault may be limited by the TCHRA, whereas employees subject only to sexual assault (but no ongoing harassment) may be free to assert common law claims. Regardless of the final outcome, in the short term employers will likely be forced to defend both claims at the same time, particularly in cases involving sexual harassment by supervisors, managers, or executives. Litigating assault claims and questions about who qualifies as a “vice principal” will also likely increase the costs of litigation in this context.

For more information on this or any related topic please contact the authors, your Seyfarth attorney, or any member of the Labor & Employment or Workplace Policies and Handbooks Teams.

By Meredith-Anne Berger and Tracy M. Billows

Seyfarth Synopsis: Recently, the Second Circuit held that the “cat’s paw” theory of liability may be used to support recovery for claims of retaliation where an employer negligently relies on information provided by a low-level employee with an “unlawful animus,” allowing employees to have an “outsize role” in an employment decision.

In Vasquez v. Empress Ambulance Service, the plaintiff complained of sexual harassment and the company began conducting an investigation, which led to the company’s downfall.  After getting wind of the complaint, the alleged harasser, Gray, himself produced false evidence that the plaintiff, Vasquez consented to and solicited a sexual relationship of her own accord and had in fact harassed Gray, which resulted in Vasquez’s termination.  The court found the company’s reliance on the information Gray provided during the investigation to be unjustifiable.  The court held that as a matter of law, the company could be found liable for Gray’s acts, despite the fact that he was a low-level employee.

The company’s investigation got off on the wrong paw from the start. First, Gray walked into the room where Vasquez was writing a formal complaint, and confronted her about reporting him.  Adding fuel to the fire, Gray then asked his coworker to lie for him and tell the supervisors that the harasser and the plaintiff were in a romantic relationship.  The coworker refused, but meanwhile, Gray manipulated a text message conversation between he and the Vasquez to make it appear as though another person with whom he exchanged sexual banter was actually Vasquez.  He then presented these doctored texts to the company, to show that he had been in a consensual relationship with Vasquez. The court was skeptical that the company could believe that Gray conveniently had printed copies of amorous text messages with Vazquez, at the very time she reported sexual harassment.

Vasquez’s supervisors thanked her for telling her story, and promised to sort the situation out, but refused to allow Vasquez to show them explicit photos sent to her by the alleged harasser. On the basis of the doctored text messages given to them by Gray and a “racy” selfie purportedly sent to Gray by Vasquez (which only showed a fraction of a face and was by no means “unequivocally” a photo of the plaintiff), the company fired Vasquez for sexual harassment. The supervisors refused to see any evidence from Vasquez that would refute Gray’s evidence and refused to show Vasquez the purported photo of her.  The court later noted that Gray “more closely resembl[es] a vengeful suspect than an independent informant.” The company failed to see the problem with blindly trusting Gray’s evidence that pointed the finger at the complainant while conducting an investigation into his own conduct.

The Second Circuit considered whether cat’s paw liability would allow the company to be held liable for its reliance on the alleged harasser’s (a coworker of plaintiff) retaliatory information. The court found that where an employer, through its own negligence, gives effect to the retaliatory intent of one of its low-level employees, it may be held liable for retaliation under Title VII.

However, the court also held that an employer who relies on a false report of an employee, but does so non-negligently and in good faith, cannot be held liable under the “cat’s paw” theory under Title VII. Further, the court found that an employer who, albeit negligently, relies on a low-level employee’s false accusations is not liable under Title VII unless the employee’s statements were the product of discriminatory or retaliatory intent, though the company may still face liability under state law for common law negligence.

This case highlights the importance of an independent, prompt, and thorough investigation (including looking at all of the evidence, not just select evidence) of any complaints of harassment, however unlikely litigation may seem at that stage. An investigation may later prove to be a sword, not a shield.

By Dawn Solowey

A great closing argument weaves the trial evidence into a compelling, memorable narrative. But trial counsel must also beware of improper argument, which can prove very costly, as shown by the recent Eighth Circuit decision in Gilster v. Primebank. Continue Reading That Closing Argument Will Cost You: A Cautionary Tale of How One Improper Argument Led to a Vacated Verdict and New Trial

By: Maya Harel

As we blogged earlier this week, the social media era is increasingly impacting the landscape of hostile work environment claims. With that in mind, it is important for employers to understand what it takes for plaintiffs to avoid dismissal of their claims and hold employers liable in sexual harassment cases.

Generally, isolated instances of improper behavior do not rise to the level of “severe or pervasive” conduct needed to establish liability for sexual harassment. If, however, a single incident was “extraordinarily severe” it may suffice to state a claim.

But what makes an incident extraordinarily severe?

Recently, a New York Federal Court considered this question when addressing allegations brought under New York’s Human Rights Law (which is analytically identical to Title VII claims) involving a male supervisor who asked a female employee out to a bar, stroked her hand in a sexual manner, and then forcibly pulled her in and kissed her on the neck. In the Court’s opinion, the severity of the of the incident was a question best left for the jury, and the fact that there was a single incident did not warrant dismissal of the plaintiff’s claims.

However, other courts in New York have interpreted similar facts in drastically different ways. For instance, earlier in 2013, a New York state court dismissed a sexual harassment case for failure to state a claim where the plaintiff’s supervisor grabbed her, demanded that she sleep with him, and then forcibly kissed her. The court found this isolated incident, along with an alleged longstanding but infrequent pattern of sexually explicit comments, to be insufficient to withstand a motion to dismiss.

While there appears to be no clear answer for when a single isolated incident amounts to sexual harassment in the workplace, employers should be aware that liability for isolated acts is possible, or, at the very least, may lead to lengthy litigation if judges are not willing to dismiss the claims. Defending these lawsuits can be expensive, so it is important to take steps (like the ones suggested here) to minimize sexual harassment in the workplace at the outset.

For more information on this issue or any other employment law related matter, please contact the author or your Seyfarth attorney.