Store Manager Who Engaged in Sexual Harassment Was NOT a "Supervisor" Under Title VII...Therefore Employer is NOT Liable For His Conduct

EEOC v. AutoZone, Inc. - Sixth Circuit Court of Appeals

Facts:  In May 2012, Gustavus Townsel ("Townsel") was transferred to an AutoZone store and made store manager.  Townsel could hire new hourly employees and write employees up for misbehaving but could not fire, demote, promote, or transfer employees.  Authority over firing, promotion, and transferring rested solely with Ira Graham ("Graham") the district manager.

From August 2012 until November 2012 when Townsel was transferred to another store, several employees accused him of sexual harassment.  Specifically, LaKindal Smith ("Smith") alleged that Townsel made lewd and obscene sexual comments to her, among other sexually charged misconduct.  Smith talked with a co-worker, Robyn McEuen ("McEuen"), about Townsel's conduct.  McEuen said that when she had been subjected to similar alleged conduct by Townsel, she just brushed it off.  Another employee, Cherrelle Green (nee Willett) told a regional human resources manager that Smith tried to show her pornography on his phone.  After talking with several other employees, including Smith, the regional human resources manager informed store employees that Townsel would be transferred to another store.  Smith did not identify having any problem working with Townsel until after his transfer (as AutoZone scheduled an additional person to work on the days when both Smith and Townsel were in the store.)

The EEOC subsequently filed suit and alleged that AutoZone subjected Smith, McEuen, and Willett to sexual harassment.  AutoZone subsequently moved for summary judgment and the district court held that since Townsel was not a supervisor under Title VII, AutoZone could not be held vicariously liable for his actions.  After granting judgment in favor of AutoZone, the EEOC appealed.

Holding:  The Court cut to the chase and pointed out that if under Title VII of the Civil Rights Act of 1964, "[i]f the harassing employee is the victim's co-worker, the employer is liable only if it was negligent in controlling working conditions" (that is if the employer knew or should have known of the harassment yet field to take prompt and appropriate corrective action.  However, if the harasser is the victim's supervisor, a non-negligent employer may become vicariously liable if the agency relationship aids the victim's supervisor in his harassment.

In this case, the Court of Appeals agreed with the district court's holding that AutoZone was not vicariously liable for Townsel's harassment because Townsel did not supervise any employees he harassed.  An employee is a "supervisor" if he/she is empowered by the employer to take tangible employment actions against the victim.  As the facts established, Townsel had no authority to fire, demote, promote, or transfer employees at the store.  Since only having the ability to hire new employees or write up misbehaving employees was not found to be a tangible employment action (with "tangible employment action" being something that impacts a significant change in employment status), the Court held that Townsel was not a supervisor as defined by the statute and relevant caselaw.  

The Court did acknowledge that had there been evidence in the record which established Townsel had the ability to effect tangible employment decisions against the employees he harassed (and thus was found to be a supervisor), the appeal could have turned out differently. With that being said, the Court noted that AutoZone had established an affirmative defense to liability if that were the case.  The defense that AutoZone could rely upon consisted of two elements:  1) that AutoZone exercised reasonable care to prevent and promptly correct any sexually harassing behavior; and 2) that the harassed employees unreasonably failed to take advantage of preventative or corrective opportunities provided by the employer.  In this instance, AutoZone posted a toll free number in its stores to report harassment which Smith acknowledged being aware of.  As well, after learning of Townsel's conduct, the Court held that AutoZone acted promptly to transfer Townsel from the store (and subsequently terminate him a few days later).  

Judgment:  The Court of Appeals affirmed the granting of summary judgment in favor of AutoZone on the grounds that the store manager was not a "supervisor" under Title VII of the Civil Rights Act of 1964 and therefore the employer was not vicariously liable for the store manager's sexual harassment against other employees.

The Takeaway:  I can certainly understand some readers that read the facts of this case and the Court's ruling and throw up their hands in disgust.  I know I would be frustrated if a store manager made suggestive comments and engaged in sexually charged behavior, yet got away "scot free".  However, this is a case that tracked the language of the relevant statute and prior caselaw and applied it to the facts to reach the correct conclusion.  Based upon the facts in the record, Townsel was not a supervisor...although he was a store manager, he did not effect tangible employment decisions.  Lacking that key requirement is what doomed the EEOC's claim that vicarious liability existed here.  

Further, as the Court noted, even if it found that Townsel was a supervisor, AutoZone had posited a valid defense:  AutoZone promptly took corrective action after learning the extent of Townsel's conduct and the employees who claimed to be victims of the sexual harassment failed to take advantage of corrective opportunities.  Had the facts been different (i.e. had the employees taken quicker steps to make the sexual harassment known by management or H.R.), this case might have resulted in a different outcome.

Majority Opinion Judge:  Per Curiam

Date:  June 9, 2017

Opinion:  http://www.opn.ca6.uscourts.gov/opinions.pdf/17a0329n-06.pdf