Employer Can be Liable under Title VII For Negligently Permitting a Coworker's Discriminatory Efforts to Cause an Employee's Termination: First Circuit | Practical Law

Employer Can be Liable under Title VII For Negligently Permitting a Coworker's Discriminatory Efforts to Cause an Employee's Termination: First Circuit | Practical Law

In Velazquez-Perez v. Developers Diversified Realty Corp., the US Court of Appeals for the First Circuit held, as a matter of first impression, that an employer could be liable under Title VII of the Civil Rights Act of 1964 (Title VII) for negligently permitting a female coworker's discriminatory efforts to cause a male plaintiff's termination. The court also held that, as a matter of first impression, the plaintiff's retaliation claim was subject to the longer 300-day limitations period under a worksharing agreement between the Equal Employment Opportunity Commission (EEOC) and the Puerto Rico Department of Labor and Human Resources.

Employer Can be Liable under Title VII For Negligently Permitting a Coworker's Discriminatory Efforts to Cause an Employee's Termination: First Circuit

by Practical Law Labor & Employment
Published on 28 May 2014 • USA (National/Federal)
In Velazquez-Perez v. Developers Diversified Realty Corp., the US Court of Appeals for the First Circuit held, as a matter of first impression, that an employer could be liable under Title VII of the Civil Rights Act of 1964 (Title VII) for negligently permitting a female coworker's discriminatory efforts to cause a male plaintiff's termination. The court also held that, as a matter of first impression, the plaintiff's retaliation claim was subject to the longer 300-day limitations period under a worksharing agreement between the Equal Employment Opportunity Commission (EEOC) and the Puerto Rico Department of Labor and Human Resources.
On May 23, 2014, in Velazquez-Perez v. Developers Diversified Realty Corp., the US Court of Appeals for the First Circuit held as matters of first impression, that:
  • An employer could be liable under Title VII for negligently permitting a coworker's discriminatory efforts to cause a plaintiff's termination.
  • A Title VII retaliation claim in Puerto Rico is subject to the longer 300-day limitations period under a worksharing agreement between the EEOC and the Puerto Rico Department of Labor and Human Resources.
(12-2226, (1st Cir. May 23, 2014).)

Background

Antonio Velazquez-Perez (Velazquez) was employed by Developers Diversified Realty Corp. (DDR Corp.) from June 2007 through August 2008. Rosa Martinez was the representative of DDR's human resources department for Puerto Rico. For the first ten months of his employment, Velazquez concedes that he had a good working relationship with Martinez, despite occasional flirtations. However, in April 2008, Martinez began a pattern of harassing behavior including:
  • In April 2008, at a hotel where they were staying for a business trip, following Velazquez to his room, trying to force her way in and sending multiple angry and suggestive emails to Velazquez and to female colleagues he had been walking with that night.
  • Sending angry emails to Velazquez in the days following that incident, making statements that Velazquez perceived as threatening to have him fired for rejecting her.
  • Discussing Velazquez's job performance with his supervisors and copying the supervisors on emails to Velazquez criticizing him for his work.
  • Referring a memo detailing her complaints of Velazquez's performance to two senior officials at the company's headquarters in Ohio.
  • At a hotel in Michigan where they were both staying for a business meeting, following Velazquez into an elevator, telling him that she did not love her husband, that she did love Velazquez and that she wanted to have a romantic relationship with Velazquez. Velazquez told Martinez that he did not want to have a relationship with her, and that she should stop following him, which she eventually did.
  • Right after the elevator incident, sending an email to Velazquez's supervisors, recommending that Velazquez be terminated immediately.
On August 25, 2008, four days after that email was sent, Velazquez's supervisors terminated him.
Velazquez sued in district court, but the district court granted summary judgment in favor of DDR. Velazquez appealed to the First Circuit, alleging that DDR:
  • Discriminated against him on the basis of sex in violation of Title VII, by:
    • terminating him; and
    • subjecting him to a hostile workplace.
  • Retaliated against him for complaining of sexual harassment.

Outcome

The First Circuit vacated the district court's grant of summary judgment to DDR on Velazquez's discriminatory termination claim, otherwise affirmed the district court's judgment and remanded to the district court for further proceedings. The First Circuit held that:
  • A jury could reasonably decide that Martinez's discriminatory actions were the proximate cause of Velazquez's termination.
  • No reasonable jury could find that Martinez was Velazquez's supervisor.
  • As a matter of first impression, DDR could be found liable for negligently allowing Martinez's discriminatory acts to cause Velazquez's firing.
  • Martinez's conduct was not sufficiently severe or pervasive to create a hostile work environment.
  • As a matter or first impression, Velazquez's retaliation claim was subject to the longer 300-day statute of limitations due to the EEOC's worksharing agreement with Puerto Rico Department of Labor and Human Resources, even though EEOC regulations about limitations periods where states have analog anti-discrimination statutes and enforcement agencies do not reference Puerto Rico.
  • Velazquez waived the appeal of his retaliation claim by failing to address challenges to that claim in his reply brief.
The First Circuit found that:
  • Martinez's persistent and forceful lobbying, for example by harshly criticizing Velazquez in emails to him and to his supervisors, and by compiling a list of allegations against him, could be the proximate cause of his discharge.
  • There is no evidence that DDR delegated to Martinez any relevant authority over any tangible employment actions affecting Velazquez. Velazquez was managed by line supervisors who decided whether to discipline or reward him, and Martinez, in her role as a member of the human resources department, filled only a supporting staff function, giving advice and assistance.
  • The fact that Martinez had to lobby other staff members to terminate or discipline Velazquez proves that she did not have the authority to fire or discipline Velazquez, and therefore she did not fit the definition of a supervisor established in Vance v. Ball State Univ., 133 S. Ct. 2434 (2013).
  • Although Vance involved claims of hostile environment sexual harassment, the case suggests that the Supreme Court intended to limit vicarious liability from all forms of unlawful harassment including quid pro quo harassment.
  • An employer can be held liable under Title VII if:
    • the plaintiff employee's colleague makes statements maligning the employee, for discriminatory reasons and with the intent to cause the employee's termination;
    • the colleague's discriminatory acts proximately cause the employee to be terminated; and
    • the employer acts negligently by allowing the colleague's acts to achieve their desired effect although it knows, or reasonably should know, of the discriminatory motivation.
    In this case, a reasonable jury applying this test could find in favor of Velazquez.
  • Neither the gifts that Martinez gave to Velazquez, nor the comments she made at the hotel during and after the April 2008 incident, were sufficiently severe or pervasive to warrant a hostile work environment claim, especially given the lack of physical touching, implicit physical coercion, extreme language or obscene behavior.
  • Worksharing agreements can permit state proceedings to be automatically initiated when the EEOC receives the charge (EEOC v. Green, 76 F.3d 19 (1st Cir. 1996)). The EEOC standard worksharing agreement clearly states that a filing with the EEOC will initiate proceedings at the Puerto Rico Department of Labor and Human Resources.

Practical Implications

This decision creates a new Title VII cause of action. It is not clear whether other US courts of appeals will adopt the First Circuit's analysis, which seems like a Cat's Paw theory of liability that imposes lighter evidentiary burdens on a plaintiff. It is also not clear whether courts will otherwise find this type of claim barred by state workers' compensation laws, which generally provide that workers' compensation benefits are the exclusive remedy for harm to an employee caused by an employer's negligent acts or omissions.