Takeaway: Employers should immediately and effectively address any alleged use of racist epithets in the workplace, particularly if at all connected to owners or management.

In this case, the 6-year-old grandson of the business owners allegedly called an employee the "n-word" on three occasions. The 4th U.S. Circuit Court of Appeals rigorously reviewed the factual record and considered whether the owners' family could have done more to protect the plaintiff, sending the issue to a jury trial.

The plaintiff worked for Oakland Living Center Inc. (OLC), an assisted living facility in Rutherfordton, N.C. The OLC's owners left the management of the business to their son, who served as a supervisor while training to take over the business. The owners and their son were White, and the plaintiff was Black.

The plaintiff began working for the OLC in 2004 as a housekeeper, cook and personal care aide at the assisted living facility. The OLC had an employee handbook, but there was only one copy of it at the front desk. During this employment, the plaintiff claimed that she experienced racial harassment and other discrimination by the owners for 11 years, until she resigned in 2015.

Among other things, she claimed that: one of the owners said she would put a "slave number" on the plaintiff's identification badge; an owner's niece made a racist statement; the owners held a birthday party that had racist overtones for their grandsons and the plaintiff; and the plaintiff asked one of the...

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