In May v. Chrysler Group, LLC, the Seventh Circuit affirmed a district court’s judgment that an employer was liable for a hostile work environment claim related to ongoing harassment of an employee who was the continual target of racist, xenophobic, homophobic, and anti-Semitic graffiti, vandalism, and death threats. However, the court also vacated a $3.5 million dollar punitive damages award. Although the employer’s actions were not sufficient to halt the hostile work environment, the Seventh Circuit found that the somewhat lackluster approach taken by the company did not amount to reckless disregard of the employee’s right under Title VII of the Civil Rights Act.
Otto May was subjected to ongoing racist, xenophobic, homophobic, and anti-Semitic remarks, acts, and even death threats while employed as a pipefitter at Chrysler. May received notes and was subjected to graffiti that was described as “disturbingly vile and aggressive” by the court. The unknown harasser(s) also repeatedly slashed and punctured May’s tires, poured sugar into his gas tank on two occasions, and wrapped a dead bird in toilet paper to look like a Ku-Klux Klansman, which was then placed in a vice at May’s work station.
May reported the death threats and harassment to Chrysler. Three weeks later, Chrysler held two short meetings in which the anti-harassment policy was reviewed. Within days of those meetings, the death threats and graffiti resumed.
May then reported more than six additional incidents. However, Chrysler did not take any further action until four months later, after May involved the Anti-Defamation League. At this point, a human resources professional met with May, and May provided a list of suspects for investigation. The HR professional failed to interview any of these suspects.
Despite this meeting, the harassment continued. May received several threatening phone calls; more graffiti singling out May appeared at the facility; and May received another death threat note. Chrysler then took the final step in its investigation which was to retain a handwriting analyst.
The internal investigation conducted by Chrysler was central to the trial on May’s hostile work environment claims. The parties focused on the investigation procedures used by Chrysler to determine whether Chrysler took steps which were reasonably calculated to end the harassment. The internal investigation was further examined to determine whether Chrysler recklessly disregarded May’s rights under Title VII of the Civil Rights Act.
The jury awarded May $709,000 in compensatory damages after finding that Chrysler was liable for the ongoing harassment, in addition to $3.5 million in punitive damages. In order to avoid returning to trial on the issue of compensatory damages, May accepted a lesser amount of $300,000. However, the $3.5 million punitive damage award was vacated by the district court. Both parties appealed to the Seventh Circuit. The Seventh Circuit found that Chrysler was liable for the ongoing hostile work environment but was not liable for punitive damages.
How Could Chrysler Have Avoided Liability?
Chrysler would be liable for the ongoing hostile work environment if it failed to promptly and adequately “respond in a manner reasonably likely to end the harassment.” The steps an employer must take to end harassment will depend on the facts and circumstances, including “the gravity of the harassment alleged.” However, success or failure stopping harassment does not determine whether an employer is liable. Rather, “the efficacy of an employer’s remedial action is material to [a] determination whether the action was reasonably likely to prevent the harassment from recurring.”
The Seventh Circuit found that Chrysler did not promptly and adequately respond to the harassment alleged by May. The Court noted that during the first year of written threats and harassment, the only steps Chrysler took were: (1) two meetings regarding the anti-harassment policy; (2) an interview of May; and (3) hiring a handwriting expert. In light of the gravity of the harassment—death threats based on national origin, religion, ethnicity, and sexual orientation—May had produced sufficient evidence that Chrysler did not have a “prompt and adequate response” to his harassment complaint.
Chrysler failed to take sufficient steps because it did not interview anyone on May’s list. The Court stated that if an employee who has been subjected to repeated threats provides an employer with a list of names, the employer’s investigator should talk to at least some of those people.
Additionally, Chrysler failed to install a single surveillance camera to seek out the harassers. May asked Chrysler to install cameras; the police also made the same suggestion. Chrysler refused to do so, stating that the facility was too large for surveillance. However, the Court noted that Chrysler could have positioned one camera on May’s tool chest, where the vast majority of the death threat notes had been placed. Chrysler also claimed that the union probably would not permit the installation of cameras. However, the union only required notice as simple as “surveillance cameras in use.”
In short, Chrysler had an obligation to take steps reasonably calculated to end the harassment. Chrysler’s actions consisted of two brief meetings and one interview. Chrysler should have followed up by interviewing the brief list of employees that May suspected. Chrysler also should have considered installing surveillance cameras. Because it failed to take these basic steps, Chrysler was not able to avoid a finding of liability and a compensatory damages award.
Lackluster Internal Investigation Still Sufficient to Avoid Punitive Damages
Although Chrysler was unable to avoid a liability verdict, the company’s lackluster investigation still was sufficient to avoid punitive damages because it made a good-faith effort to comply with Title VII. May could recover punitive damages only if Chrysler acted with “malice or with reckless indifference “to May’s complaints.” In other words, Chrysler must have made a conscious decision that resulted in depriving May of Title VII protection.
Chrysler employed several strategies to stop and prevent the harassment. When May’s cars were vandalized, he was allowed to park in the salaried lot which was monitored by cameras. Chrysler required all supervisors to meet with their employees to review the anti-harassment policy. Chrysler implemented a protocol for handling May’s harassment incidents, including prompt clean-up of graffiti, documentation of the incidents, photographic documentation, notification to human resources and security, interviews of the person who discovered the graffiti, and interviews with any other person in the area where the graffiti or threatening note was found.
Chrysler also increased its security team presence in the relevant shop area. Chrysler moved its lockers to an open area which was more easily monitored. Chrysler conducted diversity training with all employees. Finally, the shop manager held town hall meetings with all employees in which he discussed the importance of a respectful work environment.
The Court found that Chrysler’s minimal internal investigation and response to the harassment complaints was not a sufficient response under the circumstances to protect the rights of an employee who was receiving death threats. This resulted in a finding of liability. However, the Court agreed that the steps taken by Chrysler indicated that Chrysler was not consciously indifferent or reckless with respect to May’s Title VII rights. Thus, Chrysler vacated the $3.5 million punitive damages award.
The Takeaway
The Seventh Circuit has made it clear that there are two separate standards for liability and punitive damages. However, the goal of every employer obviously is to avoid both. When approaching an internal investigation, employers should remember that the facts of the situation will dictate what steps are necessary and effective. Depending on the situation, employers should consider the following tools in any internal investigation:
- Promptly interview the victim:
- Ask the victim for a suspect list;
- Ask the victim for a witness list;
- Interview suspects indicated by the victim;
- Interview witnesses indicated by the victim;
- Solicit other witnesses from the victim’s suspects during their interviews;
- Consider whether union representation is necessary at any interview;
- Consider what pre-interview warnings may be necessary;
- Discuss the role of confidentiality in interviews;
- Document all interviews;
- Solicit written statements from interviewees;
- Photograph graffiti and any other evidence;
- Review the non-discrimination and anti-harassment policies to ensure that they contain a complaint procedure with multiple channels of reporting;
- Retain all communications containing threats, whether in hard copy or electronic format;
- Review the non-discrimination and anti-harassment policies and complaint procedures with employees;
- Institute additional diversity and harassment training;
- Consider whether any criminal actions have occurred which require police involvement;
- Consider electronic surveillance and whether such surveillance should be bargained over with any union;
- Investigate any electronic or “cyber” trail;
- Engage a handwriting analysis expert for review of threatening notes;
- Promptly clean up graffiti after it has been documented;
- Periodically touch base with the harassment victim throughout the process to ensure that the harassment is not continuing.
It is vital that employers thoroughly document every step throughout the internal investigation process. Not only are you preparing for potential litigation, but you are building a record to be used for the discipline and/or discharge of the harasser. This information also may be relevant in any future action brought by a discharged harasser, whether in front of an administrative agency, in court, or in a union grievance.
If you have any questions regarding this article, please contact your Davis & Kuelthau attorney.