First Circuit Allows Case to Go to Trial Based on Co-worker’s Quid Pro Quo Harassment

By Amelia J. Holstrom

Most employers know that there are two kinds of sexual harassment claims that can be brought by employees: 1) quid pro quo and 2) hostile work environment. Quid pro quo harassment, which means “this for that,” occurs when a supervisor conditions a job benefit on the subordinates acceptance or rejection of the supervisor’s sexual advances. Employers have long understood that quid pro quo harassment can only occur between a supervisor and subordinate. In a recent case, Velazquez-Perez v. Developers Diversified Realty Corp., the First Circuit Court of Appeals found that, under Title VII, an employer can be held liable for quid pro quo sexual harassment based on the actions of a mere co-worker.

Employee, Antonio Valezquez-Perez, began working for Developers Diversified Realty Corp. (DDR) in 2007. By late 2007, Valezquez-Perez was promoted to the regional manager position. Valezquez-Perez’s direct supervisor was Rolando Albino. Albino’s boss was Francis Gonzalez.

Throughout his employment, Valezquez-Perez regularly interacted with a non-supervisory employee named Rosa Martinez. Martinez worked in Human Resources. Admittedly, the two had a flirtation relationship prior to April 2008, but each time Martinez implied she wanted something more than friendship, Valezquez-Perez gently informed her that he was not interested.

In April 2008, on a business trip, things changed between Martinez and Valezquez-Perez. One evening, Valezquez-Perez was walking with two female co-workers when Martinez followed him to his room where she attempted to force her way in. Valezquez-Perez threatened to call security and ultimately Martinez left. Thereafter, she called his room multiple times and suggested that Valezquez-Perez was going to have sex with one of the women he was seen with. In the following days, Martinez sent Valezquez-Perez a series of angry emails. In response Valezquez-Perez informed Martinez that he was not interested in her romantically. Martinez responded by making comments that Valezquez-Perez perceived as threatening to have him fired for rejecting her.

Valezquez-Perez complained to Albino and Gonzalez on several occasions. At one point, Albino told Valezquez-Perez to send an email to Martinez to smooth things over and even jokingly suggested that he consider having sex with Martinez. Albino told Valezquez-Perez that if he did not smooth things over, Martinez was “going to get [him] terminated.”

In the interim, Martinez began to criticize Valezquez-Perez’s job performance and shared her criticisms with Albino and Gonzalez. Some of Valezquez-Perez’s subordinate employees confirmed the performance criticisms and as a result, Gonzalez made the decision to give Valezquez-Perez a formal warning memorandum and place him on a Performance Improvement Plan in August 2008.

Thereafter, Valezquez-Perez saw Martinez at a hotel in which the two were staying for business. Again, Martinez followed him to his room, but this time she told him that she did not love her husband and that she loved Valezquez-Perez. In response, he told Martinez he was not interested in a relationship with her and that she should leave him alone.

That same night, Martinez wrote to Nan Zieleniec, Senior Vice President of Human Resources, and Diane Kaufman, Director of Employment and Employee Relations, and informed them that she disagreed with Gonzalez’s decision to place Valezquez-Perez on a Performance Improvement Plan. Martinez recommended that Valezquez-Perez be terminated immediately. Four days later, on August 25, 2008, Valezquez-Perez was terminated. After his termination, Valezquez-Perez sued DDR for, among other things, sexual harassment. In essence, Valezquez-Perez argued that Martinez caused his termination because he rejected her advances.

At the trial court level, the court dismissed the matter finding that DDR was not liable. Valezquez-Perez appealed and the First Circuit found in his favor. In doing so, the First Circuit quickly determined that a jury could reasonably find that Martinez told Valezquez-Perez that if he did not engage in a relationship with her she would get him fired and that after he rejected her, Martinez took various steps that ultimately caused Valezquez-Perez’s termination.

Next, because it was clearly a question of quid pro quo harassment, the court next turned to determining whether Martinez was a supervisor. The court ultimately determined that Martinez was not a supervisor because she did not have the authority to hire, fire, demote, promote, transfer, or discipline an employee. That, however, was not the end of the court’s inquiry.

The court next looked at whether the employer may be liable for quid pro quo harassment committed by a co-worker and determined that it could be. Specifically, the court noted that under Title VII the employer could be held liable for quid pro quo harassment by a co-worker if: 1) the co-worker made statements about the plaintiff for discriminatory reasons and with the intent to get the plaintiff fired; 2) the co-workers acts proximately caused the plaintiff’s termination; 3) and the employer acted on the co-workers statements and representations even though it knew or should have known of the co-workers discriminatory motivation.

In the instant case, it was clear that a jury could reasonably conclude that at least Albino knew of Martinez’s harassing conduct and her threat to have Valezquez-Perez fired and that Martinez’s comments influenced DDR’s decision. Consequently, the First Circuit reversed the trial court’s decision as to the quid pro quo sexual harassment claim and it may now proceed to trial.

Bottom Line

The decision appears to be fairly limited in its application. Yes, employers may now be liable for quid pro quo harassment committed by co-workers. However, the court’s decision makes it clear that the employer is only liable if it knew or should have known of the co-workers harassing/discriminatory actions and yet still permitted the co-workers discriminatory comments to influence the employment decision. In other words, in cases of co-worker quid pro quo harassment, employers still have a potential defense and are not simply automatically liable.

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