Labor & Employment Law Daily Wrap Up, DISCRIMINATION—SEXUAL HARASSMENT—E.D. Pa.: General manager proceeds to trial on claim he was sexually harassed by subordinate, (Jan 13, 2025)

By Kathleen Kapusta, J.D.

Noting that the fact pattern here was fairly rare, the court noted that several district courts have recognized a lane of assessing liability in cases, such as this one, where a subordinate allegedly sexually harasses his or her supervisor.

Allowing an African-American general manager of a car dealership to advance to trial on his Title VII hostile work environment claim based on allegations he had been sexually harassed by a subordinate, a federal court in Pennsylvania, noting the rare fact pattern involved here, found evidence the dealership was aware of the harassment and failed to take prompt evidence to stop it and the GM took actions attempting to stop it but was unsuccessful. His Title VII and Section 1981 race and gender discrimination claims also advanced, as did his Title VII retaliation claim, but his Section 1981 mixed motive case failed for lack of direct evidence of discrimination (Jenkins v. Ciocca Management, Inc., No. 5:23-cv-05115-JMG (E.D. Pa. Jan. 9, 2025)).

Hired as a used car manager for the dealership in 2013, the employee was promoted three years later to general sales manager and then to general manager in 2019. That same year, a delivery coordinator for the dealership began sending him sexually charged messages through Instagram, although the GM did not know he was receiving them until sometime in late 2020 or early 2021. At that time, he showed the messages to the regional vice president, who purportedly told him “he wanted nothing to do with the situation.”

Investigation. When, in 2023, the GM heard rumors that he was having an affair with the delivery coordinator, he went to the HR director, who launched an investigation. At the end of the investigation, the HR director and the dealership’s COO told the GM that he would no longer be employed in that role. While the company claimed it tried to discuss the possibility of another position with him, the GM contended that it refused to discuss whether his compensation would remain the same. He also claimed that during the meeting, the HR director told him he should have handled the situation with his subordinate by taking “her out for a drink.

According to the GM, the investigation could not confirm that he had a relationship with the subordinate and concluded that he had harassed her. While both employees made accusations against each other, the HR director testified that she had doubts as to the subordinate’s truthfulness.

Hostile work environment. Moving for summary judgment against the GM’s hostile work environment claim, the dealership argued that the claim failed as a matter of law because, as the delivery coordinator’s supervisor, he could not bring a sexual harassment claim under Title VII. The court acknowledged that while this was not the typical scenario involving supervisor-on-subordinate or coworker-on-coworker sexual harassment, several district courts have recognized “another lane of assessing liability in cases, such as this one, where a subordinate allegedly harasses his or her supervisor.” This method of analysis, said the court, largely tracks the method employed for coworker-on-coworker harassment but exempts liability for the employer if the supervisor failed to stop the harassment.

Lyles. Further, in 2014, a federal court in the District of Columbia, in Lyles v. Dist. of Columbia, identified several ways in which the supervisor could have stopped the harassment, including “reporting the harassment to the supervisor’s own supervisor... doing something to ‘effect a significant change in employment status’ of the harasser, or reprimanding the employee.”

Employing that standard here, the court found evidence the GM told the regional VP he was receiving “crazy sexual messages” from his subordinate, but the regional VP did not want to be involved. Because he was part of management, the court observed, a jury could find the dealership had actual or constructive knowledge of the sexually hostile environment. A reasonable jury, the court continued, could also find the GM attempted to stop the harassment by reporting the subordinate’s texts to the regional VP but was unsuccessful in doing so. Accordingly, the court denied summary judgment on this claim.

Title VII race/gender discrimination. The dealership next argued that the GM, for purposes of his Title VII race and gender discrimination claim, could not show he suffered an adverse action because it wanted to discuss employing him in another capacity after it removed him from his GM role, but he refused to engage in such a conversation. The GM, however, claimed that when he attempted to discuss how a change in his role would affect his compensation, the COO would not answer his question. Here, the court found a reasonable jury could conclude that such a transfer with a change in his compensation structure or financial situation with the company qualified an adverse employment action.

To show an inference of discriminatory motive, the GM pointed to his subordinate, arguing that she was a white woman who was treated more favorably than him even though they accused each other of similar misconduct and were subject to the same employment policies. Though the court found this to be a close call, it found there was enough evidence for a reasonable jury to conclude that the GM and his subordinate were similarly situated as to the relevant facts of this case. They were subject to the same employment policies and to the same supervision and investigation by the HR department. They also accused each other of similar misconduct and the GM argued that only he faced any consequences. Accordingly, the court found the GM sufficiently established an inference of discrimination.

Pretext. And while the dealership claimed it removed the GM from his role because of his poor judgment in failing to timely report the subordinate’s messages to HR—he waited two years after he told the regional VP about the messages—the court found sufficient evidence of pretext so as to preclude summary judgment. He argued that the investigation determined that he had not harassed his subordinate, there was no evidence he ever responded to any of her messages, and there was no confirmation of any relationship between them.

In addition, the HR director testified that she had doubts about the subordinate’s truthfulness and when the GM met with the director, she purportedly told him he did not know women and he should have taken the subordinate out for a drink. Despite this, he was the only one who suffered an adverse employment action. Thus, said the court, it was up to a jury to resolve these fact issues.

Section 1981. Having allowed the GM’s Title VII race discrimination claim to proceed under the McDonnell Douglas framework, the court allowed his Section 1981 claim to proceed under that framework as well. Because, however, he failed to provide any direct evidence of racial discrimination, the court granted summary judgment against his Section 1981claim on a mixed-motive theory.

Retaliation. Finally, allowing the GM’s Title VII retaliation claim to also advance, the could found he could show he engaged in a protected activity by complaining to HR about the rumor of an affair he had heard, there was evidence he suffered an adverse employment action, and the close temporal timing—one week—between his report to HR and the purported adverse action was unduly suggestive.

The case is No. 5:23-cv-05115-JMG.

Judge: Gallagher, J.

Attorneys: Vipul T. Patel (Gunther & Patel) for Sean Jenkins. Susan Smith Lloyd (Law Office of John P. Hendrzak) for Ciocca Management, Inc.

Companies: Ciocca Management, Inc.

Cases: SexualHarassment Discrimination RaceDiscrimination SexDiscrimination Discharge PennsylvaniaNews GCNNews