Are You Liable for Your Employees' Bad Actions?

Is a misogynistic manager liable for harassment?
Magazine Contributor
2 min read

This story appears in the August 2005 issue of Entrepreneur. Subscribe »

Say you have a manager who can't keep his hands to himself. One woman gets fed up and sues for sexual harassment. Who would a court hold liable?

You'd think it would be the jerk with the roaming hands who didn't get the memo about treating women with respect. You'd think wrong.

For the past 20 years, courts have ruled that Title VII of the Civil Rights Act, which prohibits discrimination against employees because of sex, includes sexual harassment. But just who is legally responsible in these cases? The statute in question makes it illegal for an employer--"a person engaged in commerce with 15 or more employees" and "any agent of such a person"--to engage in discrimination and sexual harassment. So can your company get off the hook by claiming that the perpetrator, though an agent of the company, is the only one responsible?

The answer is no. While the U.S. Supreme Court has never ruled on this issue, the majority of the federal appellate circuits have ruled that the individual supervisor is not personally liable.

That doesn't mean you have to keep a harasser on your work force. In many cases, courts treat employers more leniently if they educate their supervisors about what sexual harassment is, establish a culture where it isn't tolerated and, when someone reports it, take prompt action.


Jane Easter Bahls is a writer in Rock Island, Illinois, specializing in business and legal topics.

More from Entrepreneur

Get heaping discounts to books you love delivered straight to your inbox. We’ll feature a different book each week and share exclusive deals you won’t find anywhere else.
Jumpstart Your Business. Entrepreneur Insider is your all-access pass to the skills, experts, and network you need to get your business off the ground—or take it to the next level.
Are you paying too much for business insurance? Do you have critical gaps in your coverage? Trust Entrepreneur to help you find out.

Latest on Entrepreneur