In EEOC v. KarenKim, Inc., the US Court of Appeals for the Second Circuit considered whether the US District Court for the Northern District of New York abused its discretion by denying the EEOC's motion for injunctive relief after the defendant company was found liable for sexual harassment and for fostering a sexually hostile work environment in violation of Title VII and New York State law. A key litigated issue was whether the District Court properly denied the EEOC's motion when the sexual harasser had been terminated from employment but was in a relationship with the defendant company's owner, and therefore could continue harassing the company's employees.

Karen Conners, the owner of KarenKim, Inc., a grocery store operating in Oswego, New York, hired Allen Manwaring as Store Manager in 2001. Conners and Manwaring became romantically involved soon afterwards, have been engaged since 2006 and now have a young son together. As Store Manager, Manwaring repeatedly subjected a number of KarenKim employees, many teenaged girls, to verbal and physical sexual harassment. Although KarenKim did not have an anti-harassment policy until 2007 or a formal complaint procedure until after the trial in this case, several employees complained to their supervisors about Manwaring's conduct. At least two employees were terminated after complaining (one for absenteeism), and Connors found several complaints she received about Manwaring's conduct were unfounded.

After Manwaring pled guilty to second degree harassment for sticking his tongue in a young employee's mouth, KarenKim drafted a sexual harassment policy directing employees to report instances of sexual harassment to Connors. Connors suspended Manwaring for 30 days with pay for his conduct, but Manwaring entered the store a few times during his suspension without consequences.

In 2010, Connors finally terminated Manwaring for sexual harassment after one employee quit after having made several complaints about Manwaring's behavior. However, Connors tried to conceal the reason for his termination after the fact, and Manwaring continued to enter the store.

The EEOC filed suit against KarenKim and a jury returned a verdict for the EEOC, finding KarenKim and Manwaring had maintained a sexually hostile work environment with malice or reckless indifference to the rights of KarenKim's young female employees in violation of Title VII. The jury awarded compensatory and punitive damages to ten persons who had been victimized by KarenKim and Manwaring.

After trial, the EEOC moved to alter and amend the judgment to impose injunctive relief against KarenKim, arguing the relief was necessary because KarenKim had not adopted adequate measures to ensure the harassment did not continue. In particular, the EEOC noted:

The EEOC requested broad injunctive relief that would, in part, bar KarenKim from rehiring Manwaring and allowing him to enter the store, pay for an independent monitor to continually review its employment practices and cooperate in bi-annual EEOC compliance reviews for ten years. The District Court denied the EEOC's request, finding the requested relief was unnecessary and overly burdensome because there was no cognizable danger that KarenKim would engage in recurring Title VII violations. The EEOC appealed.

On October 19, 2012, the Second Circuit issued an opinion in EEOC v. KarenKim, Inc., holding that given the circumstances of the case, the District Court abused its discretion in denying the EEOC any injunctive relief.

The court noted that while in many cases terminating the harasser is sufficient to eliminate the danger of recurring Title VII violations, this case was unusual because:

Given these concerns, the Second Circuit held that, at a minimum, the District Court should have prohibited KarenKim from rehiring Manwaring and permitting him to enter the store premises.

The District Court also found that, as the moving party, the EEOC had the burden of proving injunctive relief was necessary. The Second Circuit noted that other circuit courts have held that, where violations of Title VII have been proven, injunctive relief is presumptively appropriate, and the defendant-employer instead has the burden of showing it should not be granted. However, the court ultimately did not rule on this issue, as regardless of which party had the burden of proof in the case, the EEOC had presented sufficient evidence to prevail on its motion.

The Second Circuit's decision in EEOC v. KarenKim, Inc. highlights that terminating a harasser may not sufficiently prevent future sexual harassment where the harasser has a continuing relationship to the employer. In light of this decision, employers in the Second Circuit should closely scrutinize the circumstances of any harassment on their premises to ensure they have taken appropriate steps, above and beyond termination, to prevent the harassment from recurring.

For more information on sexual harassment, see Sexual Harassment Toolkit. For resources to assist an employer in responding to an EEOC charge, see Preventing and Responding to an EEOC Charge Toolkit.