Under California’s Fair Employment and Housing Act (“FEHA”), employers generally are strictly liable for a supervisor’s harassment, even where the employer is unaware of the supervisor’s alleged bad actions. While this left many employers without much recourse in the event supervisors misbehaved, a recently published Court of Appeal decision offers some hope. In Atalla v. Rite Aid Corp., 2023 WL 2521909 (Cal. Ct. App. Feb. 24, 2023), the Court of Appeal established limits on the extent to which employers can be held responsible for conduct stemming from employees’ personal relationships and after-hours conduct.
Hanin Atalla (“Atalla”), a pharmacist, sued Rite Aid alleging that Erik Lund (“Lund”), a Rite Aid district manager, had sexually harassed her, among other claims. Atalla’s harassment claim stemmed from a series of late-night text messages containing a video of Lund engaging in a sexual act and a photo of his genitals. Rite Aid did not dispute that Lund had sent the sexually explicit communications, but maintained that it was not liable for harassment based on Lund’s conduct because he was not acting in his capacity as a supervisor at the time. The trial court granted summary judgment to Rite Aid on Atalla’s sexual harassment claim, among others, and Atalla appealed.
The Court of Appeal affirmed summary judgment for Rite Aid because it agreed that the alleged harassment occurred when Lund was not acting in his capacity as a supervisor. In reaching this conclusion,...
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