Employment Law - Law Firms Playing Favorites In The Workplace

Tuesday, November 1, 2005 - 01:00

Just when employers thought it safe to show preference to a paramour in the workplace, a recent California case has prompted a closer look at the limits of the well-established paramour rule, which holds that a supervisor's accordance of preferential treatment to his paramour might be unfair, but not illegal. This article explores that California decision, Miller v. Dep't of Corrections, 30 Cal. Rptr. 3d 797, 36 Cal.4th 446 (Cal. 2005), the EEOC's guidance on sexual favoritism, and other noteworthy favoritism cases. This authority permits employees who are not targets of sexual conduct to bring a hostile work environment claim where the employer has permitted an atmosphere permeated by widespread favoritism of consensual sexual partners.

However, employers should not despair. This theory of sexual harassment is limited to egregious factual circumstances. By understanding the legal parameters discussed below, employers can minimize their potential exposure to hostile work environment claims based on the "widespread favoritism" theory.

Miller v. Dep't of Corrections

In Miller, two former state prison correctional officers claimed that their prison warden had accorded unwarranted favorable treatment to female employees with whom he was having consensual sexual relationships, in violation of California's anti-discrimination statute. Unlike typical plaintiffs in a sexual harassment case who are targets of unwanted sexual advances, conduct or comments, the crux of plaintiffs' claim was that the warden's sexual relationships with others created a hostile work environment for them. The Supreme Court of California found that the district court improperly granted summary judgment in favor of defendant.

The Miller court was presented with extraordinary facts. The evidence demonstrated that the prison warden had sexual affairs with three subordinates over the course of several years and that these affairs began at one prison facility and continued at another facility after the warden caused them to be transferred. These individuals, working in a confined environment, openly boasted about their relationships with the warden and "squabbled over him, sometimes in emotional scenes witnessed by other employees." 30 Cal. Rptr. 3d at 805. In addition, special benefits were accorded to the warden's paramours, including promotions and the power to harass other employees who complained about the affairs - including verbal and physical abuse - without being subjected to discipline. Moreover, outraged employees testified that they believed they needed to have sex with the warden to receive such favorable treatment. One of the warden's paramours announced that if she was not given a promotion by the warden, she would "'take him down' with her knowledge of 'every scar on his body.'" Id. at 804. Further, the warden told plaintiff Miller that he was "'finished'" with one of his paramours and that he "should have chosen Miller - a comment Miller reasonably took to mean that he should have chosen Miller for a sexual affair." Id. at 815.

In arriving at its conclusion that a reasonable jury could find that such conduct, viewed in its entirety, was "severe" and "pervasive" such that it altered plaintiffs' terms and conditions of employment, id. at 814, the court concluded that "although an isolated instance of favoritism on the part of a supervisor toward a female employee with whom the supervisor is conducting a consensual sexual affair ordinarily would not constitute sexual harassment, when such sexual favoritism in a workplace is sufficiently widespread it may create an actionable hostile work environment [for non-paramours] in which the demeaning message is conveyed to female employees that they are viewed by management as 'sexual playthings' or that the way for women to get ahead in the workplace is by engaging in sexual conduct with their supervisors or the management." Id. at 801-02 (citations omitted).

In addition to heavily relying upon a policy statement issued by the EEOC, the Miller court relied upon two federal court decisions which, according to the court, "suggest[ed] that overt manifestations of sexual favoritism may create a hostile work environment in violation of Title VII when they convey the message that a woman cannot be 'evaluated on grounds other than her sexuality.'" Id. at 813 (quoting Drinkwater v. Union Carbide Corp., 904 F.2d 853, 862 (3d Cir. 1990) and citing Broderick v. Ruder, 685 F. Supp. 1269, 1277-78 (D.D.C. 1988)). Finally, the Miller court defended its conclusion by stating that "the concept of conduct that gives rise to a hostile work environment by creating a work atmosphere that is demeaning to women is not new." Id. (relying upon a California regulation and courts stating that harassment may include the posting of derogatory or lurid images) (emphasis in original).

EEOC Policy Statement

Critical to the Miller court's decision is its reliance on an EEOC Policy Statement in which the EEOC explains three types of sexual favoritism: isolated favoritism, favoritism when sexual favors have been coerced, and widespread favoritism of consensual sexual partners. See EEOC Policy Guidance on Employer Liability Under Title VII for Sexual Favoritism, No. N-915.048, January 12, 1990 (" EEOC Policy "). With respect to the first category, it is the EEOC's position that while isolated favoritism may be "unfair," it does not rise to the level of an actionable sexual harassment claim. Id. § A. This position is consistent with the vast majority of courts who have considered this issue. See, e.g., Womack v. Runyon, 147 F.3d 1298, 1300 (11th Cir. 1998); Taken v. Oklahoma Corp. Comm'n, 125 F.3d 1366, 1370 (10th Cir. 1997); Bercerra v. Dalton, 94 F.3d 145, 149-50 (4th Cir. 1996); DeCintio v. Westchester County Med. Ctr., 807 F.2d 304 (2d Cir. 1986). The reason for this policy is straightforward: the non-paramour is not disadvantaged based on his or her gender, which is protected by anti-discrimination laws. Rather, the non-paramour is disadvantaged because of the supervisor's preference for his or her paramour. See EEOC Policy § A. As the Second Circuit explained in DeCintio, there is "no justification for defining 'sex' for Title VII purposes, so broadly to include an ongoing, voluntary, romantic engagement." 807 F.2d at 307.

The EEOC takes a different position with respect to "widespread favoritism." Indeed, the EEOC articulates two potential causes of action against employers based upon widespread favoritism. See EEOC Policy § C. First, the EEOC policy provides that men and women may bring hostile work environment claims even if the alleged conduct based on consensual sexual affairs is not directed at them, if the atmosphere is sufficiently severe or pervasive to alter the conditions of their employment. See id. According to the EEOC, if a supervisor's conduct is widespread such that it sends an implicit message that women are viewed as "sexual playthings" and creates an environment demeaning to women, a claim can be stated by men and women who do not welcome this conduct. Id. This is the theory (and language) adopted by the Miller court. Second, the EEOC provides that female employees can bring an implied quid pro quo claim where "[m]anagers who engage in widespread sexual favoritism . . . communicate a message that the way for women to get ahead in the workplace is by engaging in sexual conduct or that sexual solicitations are a prerequisite to their fair treatment." Id. Evidence of such a message may also be used to support a hostile work environment claim. See id.

To illustrate a scenario of widespread sexual favoritism, the EEOC discusses the Broderick case, cited in Miller, in which a federal district court concluded that a staff attorney at the Securities and Exchange Commission ("SEC") established that she was forced to work in a hostile work environment where plaintiff and other female employees were deprived of promotions and job opportunities due to, among other things, a number of sexual affairs between four of plaintiff's supervisors and other women. 685 F. Supp. at 1273-75, 1278. The court emphasized while plaintiff was the target of a few unwelcome sexual incidents, the more compelling aspect of her claim was the offensive environment created by these supervisors through their sexual relationships with other women in which plaintiff's motivation and performance were severely affected. See id . at 1278.

The EEOC's Policy Statement is regularly relied upon by courts for its policy on isolated favoritism. In addition, some courts have acknowledged a potential cause of action based on widespread favoritism as articulated in the Policy Statement. For example, in Bartniak v. Cushman & Wakefield, Inc., where a plaintiff requested a sexual favoritism jury charge, the court quoted the EEOC Policy Statement and noted that "a charge of sexual favoritism may be appropriate in some circumstances." 223 F. Supp. 2d 524, 531-32 (S.D.N.Y. 2002). However, citing DeCintio, the court concluded that plaintiff's evidence fell short of widespread favoritism. See id .

Bad Facts Make Bad Law: Widespread Favoritism Theory Limited To Extreme Cases

Beyond Miller and Broderick, very few - if any - courts have found viable sexual harassment claims on a widespread favoritism theory. This is not surprising, since courts are rarely faced with the outrageous behavior found in Miller . While the effect of Miller remains to be seen, it is unlikely that the floodgates will suddenly open to these claims, considering that the EEOC's widespread favoritism policy - promulgated over fifteen years ago - has rarely been invoked by courts. Even under the EEOC's policy, only a rare set of circumstances could create a hostile work environment based on consensual sexual relationships in the workplace. Without an egregious set of facts, the judiciary appears hesitant to extend the protection of the anti-discrimination laws and depart from the well-settled paramour rule.

Preventing A Miller Scenario

The favoritism cases and EEOC policy, however, can assist employers in preventing and defending claims of sexual favoritism. Employers should keep in mind the key factors behind the Miller court's decision (and the EEOC's policy) in order to evaluate the legal risk to the company, including (1) the number of employees with whom the supervisor has sexual relationships; (2) the number of supervisors engaged in sexual affairs with subordinates; (3) how public the relationships are in the office and the interaction between the employees who are the supervisor's paramours and the supervisor; (4) whether the employees having these relationships are receiving benefits that other employees are not receiving and which are not justified by performance or other merit-based reasons; (5) whether the employees who are having these relationships with supervisors wield power over the employees who are not in such relationships; and (6) whether the overall feeling in the workplace is that in order to be promoted or receive equal treatment, an employee must have sexual relations with the supervisor.

In addition, employers should train supervisors and managers about the legal risks that may flow from relationships with subordinates, and should consider prohibiting such relationships. Even though isolated instances of favoritism towards paramours are generally lawful, they inevitably create employee relations problems, and potential lawsuits. An increased awareness may alleviate potential issues before they become "widespread" and potentially actionable.

Kevin B. Leblang is Chairman of the Employment Law Group at Kramer Levin Naftalis & Frankel LLP and Rachel Manne is an Associate in the group.

Please email the authors at kleblang@kramerlevin.com or rmanne@kramerlevin.com with questions about this article.