was involved in the meeting investigating the conduct of Carl
Emanuelson. Lidwell spoke to him and told him that she did not like Carl
Emanuelson and that Carl Emanuelson had made some inappropriate
comments, but that she was not interested in pursuing the matter through
At some point shortly thereafter, Ferguson spoke to Carl Emanuelson
about what she had heard concerning his behavior. She told him that such
conduct was unacceptable if it was happening and that his behavior would
be monitored. According to Ferguson, no further misconduct was reported
or observed. Also, within one or two weeks of Lidwell's discussion with
Ferguson, UPNC employees were provided with a revised sexual harassment
policy, which Lidwell saw. However, Carl Emanuelson adopted a demeaning
attitude toward Lidwell, comprised of looking at her with a sneer and
laughing when she passed him at work. According to Lidwell, this occurred
every time she saw Carl Emanuelson after speaking to Ferguson. Still, no
further statements with a sexual content occurred.
However, after speaking with Ferguson about Carl Emanuelson's conduct,
Lidwell found that her shifts at UPNC were cut.*fn1 Ferguson did not
order a cut in Lidwell's hours. Rather, it was the policy of UPNC to
allow its employees to work before any agency employees even if that
meant that UPNC employees were working overtime. Supervisors were
directed to cancel any shifts scheduled for agency use whenever
possible. Employees of Lidwell's agency were the first to be cut, but RN
Supervisors did not determine who was assigned to work because they did
not determine which agency employees worked any particular shifts. The
use of agency employees decreased dramatically in 1996 (3,726.72)
compared to levels existing in 1995 (12,168.91).
During the fall of 1995, in addition to working at UPNC, Lidwell worked
at Nittany Valley Rehabilitation Hospital and "The Meadows," facilities
owned by HealthSouth Corporation. Her position was part-time as a "pool
employee" from October 23, 1995, until January, 1996, when it became
full-time. The full-time position was RN Supervisor at Nittany Valley and
required Lidwell to work on weekends.
Generally, Lidwell had worked only weekends at UPNC because her husband
was available to stay with their three children. Her agency did not
guarantee hours. When Lidwell's shifts were canceled by UPNC, no one was
assigned to replace her.
Lidwell was aware that Carl Emanuelson was bitter toward agency
personnel because he felt that they were overpaid.
UPNC had a posted sexual harassment policy that also was distributed
with employee paychecks, and "in-services" on sexual harassment were
provided. The policy provided that, upon receipt of a complaint of sexual
harassment, an investigation would follow. Lidwell was not provided with
the policy personally, but was aware of the policy after it was shown to
her by an employee of UPNC who received it with a paycheck.
III. TITLE VII
(A) Hostile Work Environment
It is an unlawful employment practice under Title VII for an employer
"to fail or refuse to hire or to discharge any individual, or otherwise
to discriminate against any individual with respect to his compensation,
terms, conditions, or privileges of employment, because of such
individual's race, color, religion, sex, or national origin." 42 U.S.C.
2000e-2(a)(1). This prohibition is broader than a bar to economic or
tangible discrimination, and covers
more than terms and conditions in a narrow, contractual sense.
Faragher v. City of Boca Raton, 524 U.S. 775, 786 (1998) (citing
Oncale v. Sundowner Offshore Services, Inc., 523 U.S. 75, ,
118 S. Ct. 998, 1001 (1998); Harris v. Forklift Systems, Inc.,
510 U.S. 17, 21 (1993); Meritor Savings Bank, FSB v. Vinson,
477 U.S. 57, 64 (1986)). "[S]exual harassment so severe or
pervasive as to alter the conditions of [the victim's] employment
and create an abusive working environment violates Title VII."
Faragher at 786 (quoting Meritor at 67; further citations, internal
The Supreme Court has described hostile environment claims in general
terms. Such a claim has two prongs: objective, meaning that a reasonable
person would find the environment hostile or abusive; and subjective,
meaning that the victim in fact perceived the environment as hostile or
abusive. Faragher at 787 (citing Harris at 21-22). Whether an environment
is hostile or abusive is determined based on the totality of the
circumstances, including the frequency and severity of the discriminatory
conduct, its nature as physically threatening or humiliating as opposed
to a mere offensive utterance, and whether it interferes with an
employee's work performance. Faragher at 787-788 (citing Harris at 23).
Moreover, Title VII does not prohibit genuine but innocuous differences
in the ways men and women routinely interact with members of their own or
the opposite sex. That is, simple teasing, offhand comments, and isolated
incidents (unless extremely serious) will not amount to discriminatory
changes in the terms and conditions of employment. Faragher at 788
(citing Oncale at , 118 S. Ct. at 1003).
More specifically delineating the elements of such a claim, the Third
Circuit has held that, to succeed on a claim of a sexually hostile work
environment, a plaintiff must prove that: (1) the plaintiff suffered
intentional discrimination because of her sex; (2) the discrimination was
pervasive and regular; (3) the discrimination detrimentally affected the
plaintiff; (4) the discrimination would detrimentally affect a reasonable
person of the same sex in that position; and (5) the existence of
respondeat superior liability. Kunin v. Sears Roebuck and Co.,
175 F.3d 289, 293 (3d Cir. 1999), cert. denied, 120 S. Ct. 398 (1999).*fn2
(B) Employer Liability
The primary argument put forth in support of UPNC's renewed motion for
summary judgment is that UPNC is not liable under Faragher and Ellerth.
opinions, the Supreme Court established the law of employer
liability under Title VII.
As a preliminary matter, it should be noted that the distinction
between quid pro quo claims and hostile environment claims under Title
VII is not significant in the context of determining whether the employer
may be held liable. Rather, that distinction is significant in the
context of the threshold question of whether the plaintiff can prove
discrimination: when there is a tangible employment action, the
employment decision itself constitutes an actionable change in the terms
and conditions of employment; for harassment which precedes any tangible
employment action, the conduct must be severe or pervasive. The
employer's potential liability, however, is not affected by the
characterization of the claim as either quid pro quo or hostile
environment. Ellerth at 753-754.
There are several categories of cases in which an employer's liability
is rather straightforward. When the alleged harasser is "within that
class of an employer organization's officials who may be treated as the
organization's proxy," the employer may be liable. Faragher at 789.
Also, when there is a discriminatory employment action with tangible
results, the employer will be liable once the discrimination is proven.
Id. at 790. The rationale for the latter rule may be that the decision
maker "merges" with the employer or becomes the proxy for the employer in
making such a decision. Alternatively, the decision maker may be seen as
acting within the scope of his or her authority in making the decision.
Finally, it may be said that the decision maker is aided by the agency
relation in taking a discriminatory action. Id. at 790-791 (collecting
cases). Regardless, Meritor confirmed the "soundness of the results in
these cases (and their continuing vitality), in light of basic agency
principles . . ." Faragher at 791.
When the employer or high-echelon official of an employer has actual
knowledge of actionable harassment by subordinates, the employer may be
liable. This liability is premised on a theory of demonstrable negligence
or as the employer's adoption of the conduct and results as if they had
been authorized as the employer's policy. Id. at 789. See also Kunin at
293-294 (employer liable if it knew or should have known of harassment
and failed to take prompt remedial action). The Third Circuit utilizes a
theory of negligence. Kunin at 294 (no liability when employer's response
stops the harassment; citing Bouton v. BMW of N. America, Inc.,
29 F.3d 103, 110 (3d Cir. 1994), which held that there is no negligence if
grievance procedure is effective).
More difficult are those instances in which there is no tangible,
adverse job action, and the harasser is not of that class of persons
sufficiently high in the defendant's hierarchy to be considered a proxy
for the employer. Because Title VII defines "employer" to include
"agents," 42 U.S.C. 2000e(b), principles of agency law are applied,
using the general common law of agency rather than the law of any
particular state so that there will be uniformity and predictability in
the law under Title VII. Ellerth at 754-755. The beginning point is the
RESTATEMENT (SECOND) OF AGENCY (1957). Ellerth at 755. See also Faragher
at 793. The first relevant provision reads, "A master is subject to
liability for the torts of his servants committed while acting within the
scope of their employment." RESTATEMENT, § 219(1). Conduct is within
the scope of employment when actuated, at least in part, by a purpose to
serve the master. RESTATEMENT, § 228(1)(c).*fn3 See also Ellerth at
118 S.Ct. 2257; Faragher at 793. While courts generally have found
that conduct creating a hostile environment falls outside the scope
of employment because it is not motivated by a purpose to serve the
master, the Supreme Court pointed out that this will not be true in
every case. Ellerth at 756-757; Faragher at 793-798. For example,
sexual harassment may be a way of furthering the employer's policy
of discouraging women from seeking advancement. Ellerth at 757
(citing Sims v. Montgomery County Comm'n, 766 F. Supp. 1052,
1075 (M.D. Ala. 1990)). Other examples might be racial discrimination
in job assignments to placate prejudice in the workforce, thereby
preserving peace, or reprimanding male workers with banter while
responding to female employees' shortcomings in harsh or vulgar terms.
Faragher at 798-799. *fn4 However, "The general rule is that sexual
harassment by a supervisor is not conduct within the scope of
employment." Ellerth at 757.
Even if an employee is not acting within the scope of employment, there
are instances in which the employer may be liable. These instances are
those described in the following provision:
A master is not subject to liability for the
torts of his servants acting outside the scope
of their employment, unless:
(a) the master intended the conduct or the
(b) the master was negligent or reckless, or