Sexual Harassment Hazing Claim Not Barred by WC Exclusivity Provision

Attorney Tom Robinson, Lexis Nexis, shares insight into an interesting claim about a workers compensation and sexual harassment claim.

In a suit against Cheesecake Factory, the EEOC alleged that sexualized hazing of workers occurred at the company’s Chandler, Arizona facility. A restaurant worker should not reasonably expect to suffer humiliation and sexual abuse at the hands of coworkers, but if multiple reports are true, that is exactly what a number of male workers had to endure at this restaurant.

To what extent are sexual harassment suits against employers barred by the exclusive remedy provisions of a typical state workers’ compensation act? After all, once such an act has become applicable either through compulsion or election, it affords the exclusive remedy for injury by the employee against the employer [see Larson’s Workers’ Compensation Law § 100.01et seq.]. But does it always?

Title VII of the Civil Rights Act of 1964
It is axiomatic that the exclusive remedy provisions of a state’s workers’ compensation act cannot trump federal anti-discrimination laws, such as Title VII of the Civil Rights Act of 1964, which generally prohibits discrimination and/or harassment of employees on the basis of, among other things, their sex [see The Supremacy Clause (USCS Const. Art. VI)].

State Anti-Discrimination Laws
The same is usually true for claims for sexual harassment brought pursuant to state anti-discrimination laws. The predominant justification is the important public policy underlying such civil rights laws, which would be thwarted by a rigid application of the exclusiveness doctrine.

Tort Claims Associated With Charges of Sexual Harassment
In conjunction with their statutory sexual harassment claims, plaintiffs frequently raise related tort claims for injuries or distress caused by the alleged offensive and prohibited behavior. Because workers’ compensation law was created to supplant the common law of tort for injuries arising out the workplace, courts are far more likely to find these tort claims barred by exclusivity [see Larson’s Workers’ Compensation Law § 104.05[4]].

In most jurisdictions, however, some tort claims are successful as against the exclusivity defense, being treated as outside the ambit of the workers’ compensation system. Decisions of this kind generally rely on one of three distinguishing features:

the intangible or emotional nature of the plaintiff’s injury;
the intentional–rather than accidental-quality of sexual harassment; or
the personal-rather than work-related-origin of sexual harassment.

Defenses Related to Respondeat Superior
The plaintiff who attempts to hold the corporate employer liable in tort has the additional burden of connecting the corporation with the offensive act. One common defense to a claim based on sexual harassment is that the injury, typically the act of a supervisor, was not one arising out of the employment, but rather was the personal act of a third person. One effort to get around the defense is to show negligent hiring and retention of a known offender. Ordinarily, mere negligence is insufficient to implicate the employer; retention on the part of the employer, as demonstrated by repeated refusals to act in the face of ample warnings, may suffice to show intent.

Key Is the Type of Injury Sustained by Victim
Usually, an exclusivity challenge will hinge upon the type of injury sustained. If the core elements of the suit allege humiliation, mental distress, indignity, embarrassment or such typical job discrimination items as lost wages or loss of promotion, the exclusiveness clause does not apply. However, if a substantial portion of the complaint involves physical injury, or the kind of mental or nervous injury or emotional distress compensable under the workers’ compensation law, most states will hold the action to that extent banned.

An important corollary of this rule is that the more liberal a jurisdiction is in compensating for mental-mental injuries, the more the range of possible tort suits is reduced. A state which refuses to compensate within the workers’ compensation system for mental-mental harms may well have left the door open to tort suits for emotional distress.

Application of “Exclusivity Defense” in Cheesecake Factory Case
According to most news reports, the instances of alleged sexual hazing at the Chandler, Arizona Cheesecake Factory restaurant involved not so much physical injury, but rather humiliation, intimidation, and the like. The EEOC’s case is not subject to the exclusivity defense-it isn’t a claim filed by an employee-and to the extent that individual plaintiffs file suits of their own against the employer, their claims of discrimination and harassment will likely move forward in spite of workers’ compensation exclusivity. Only to the extent that the plaintiffs claim physical injuries are they likely to be hindered.

Author: Thomas A. Robinson This blog was specially prepared by Lexis Nexis for the Workers’ Comp Kit Blog by LexisNexis Workers’ Compensation Law Center and reprinted with the publisher’s permission.

Try the WC Cost Calculator to show the REAL COST of work comp.
Look at WC 101 for the basics about workers comp.

Do not use this information without independent verification. All state laws are different. Consult with your corporate legal counsel before implementing any cost containment programs.