Modern Continental/Obayashi v. Massachusetts Commission Against Discrimination

Modern Continental/Obayashi vs. Massachusetts Commission Against Discrimination & another. Suffolk. January 6, 2005. September 7, 2005. Present: Marshall, C.J., Greaney, Ireland, Spina, Cowin, & Sosman, JJ. Anti-Discrimination Law, Sex. Employment, Discrimination, Sexual harassment. This court concluded that an employer may be held liable for failing to respond reasonably to acts of sexual harassment of which it is aware or reasonably should be aware, even though the harassing acts are perpetrated by someone who is not an agent or employee of the employer [104-108], and that the standard for imposing liability in such an instance is whether the employer took prompt, effective, and reasonable remedial action once it realized or should have realized that one of its employees was being victimized by a third party’s harassment [108-110], In a civil action seeking review of a decision of the Massachusetts Commission Against Discrimination (commission) finding an employer liable for sex discrimination when it failed to protect one of its employees from harassment by employees of one of the employer’s subcontractors, the judge erred in granting judgment on the pleadings in favor of the commission, where, as a matter of law, the remedial steps that the employer undertook satisfied its obligation to take prompt action that was reasonably calculated to end the harassment being perpetrated on its employee. [110-118] Civil action commenced in the Superior Court Department on March 26, 2002. The case was heard by Carol S. Ball, J., on a motion for judgment on the pleadings. The Supreme Judicial Court on its own initiative transferred the case from the Appeals Court. Richard D. Wayne for the plaintiff. Beverly I. Ward for Massachusetts Commission Against Discrimination. James B. Cox for Whatleigh Edmands. John D. O’Reilly, III, Karl J. Gross, & James F. Grosso, for Associated General Contractors of Massachusetts, Inc., & others, amici curiae, submitted a brief. Whatleigh Edmands. Sosman, J. Modem Continental/Obayashi (Modem) sought judicial review of a decision by the Massachusetts Commission Against Discrimination (MCAD) finding Modem liable for sex discrimination when Modern failed to protect one of its employees from harassment by employees of one of Modem’s subcontractors. A judge in the Superior Court affirmed the MCAD’s decision, and Modem appealed. We transferred the case to this court on our own motion. Although we reject Modem’s contention that an employer can never be liable for sexual harassment perpetrated by outside third parties, we agree that, on this record, Modern satisfied its obligation to its employee by making reasonable efforts to remedy the harassing conduct. The MCAD’s decision to the contrary is not supported by substantial evidence, and instead reflects the imposition of an erroneous standard higher than reasonableness. We therefore reverse the judgment. 1. Facts and procedural background. On January 18, 1994, Whatleigh Edmands, a female employee of Modern, filed a complaint with the MCAD charging Modem with sex discrimination based on sexual harassment. She subsequently amended her complaint to add Mohawk Construction (Mohawk), one of Modem’s subcontractors, as a respondent, but ultimately settled her claim against Mohawk. She amended her complaint again to add a claim that she was constructively discharged from Modem as a result of a hostile work environment. The investigating commissioner found probable cause to support the claim of sexual harassment, but no probable cause to support the claim of constructive discharge. The matter went forward to a public hearing solely on the sexual harassment claim. The hearing commissioner’s findings on that claim are as follows, supplemented by uncontested details from the record. Modem was the successful bidder on a public works project to prepare the eastern approach to the Ted Williams Tunnel, a portion of the Central Artery/Tunnel project (the so-called “Big Dig”). Modem subcontracted the iron work on the project to Mohawk. As a condition of its contract, Modem and all of its subcontractors entered into a project labor agreement with the construction trades unions, which required, inter alla, that all craft employees (including foremen) be union members, that all such employees be hired through exclusive union hiring halls, and that workers not be disciplined or terminated except for “just cause.” Whatleigh Edmands, an apprentice carpenter, was hired by Modem through the carpenters’ union in October, 1993. She worked with four or five other caipenters on a crew supervised by foreman Charles Cofield. Numerous other tradespeople were on the site, including ironworkers employed by Mohawk. On November 3, 1993, Edmands was using one of the portable toilet facilities on the site when she heard scratching noises outside. Looking up, she saw someone peering through an air vent near the roof. The peeper was wearing a brown hard hat of a type worn exclusively by the ironworkers. When Edmands tried to exit, she found herself unable to open the door, as a tie wire had been fastened around the toilet enclosure. She screamed, and someone cut the tie wire to let her out. As she came outside, she saw approximately twelve men in the area. She yelled at them, demanding to know who had spied on her and tied her in the portable toilet facility. None of them responded. Later that day, Edmands informed Cofield of the incident, and Cofield assured her that he would “take care of this.” The following day, Richard Ell, the steward for the carpenters’ union, came to see Edmands about the incident, and, the next day, returned to see Edmands with Jay Kennedy, the steward for the ironworkers’ union. Ell informed Edmands that one of the ironworkers, Joe Roselli, had admitted responsibility for tie wiring Edmands into the toilet facility. Ell asked Edmands if she wanted to have Roselli apologize in person, suggesting that seeing him might enable her to identify him as the person who had peered in through the vent. Although Edmands said that she did not wish to speak to Roselli, Roselli was brought over and made his apologies to her. He admitted that he was the one who had fastened the tie wire, but claimed it was a prank that he intended to play on another ironworker, and that he had thought someone else was using the toilet facility at the time. Roselli denied that he had looked through the vent. After hearing from Roselli, Ell asked Edmands if she could identify Roselli as the person who had peered in through the vent. She could not. At the hearing, Edmands testified that Roselli was not the peeper. On November 8, five days after the incident, Edmands and Ell met with Modem’s project manager, John McNamara. McNamara indicated that he would speak with the ironworkers’ business agent to have Roselli removed from the site. McNamara also suggested that Edmands view the videotapes of the work site to see if those tapes would help her identify the person who had peered in through the vent. Thereafter, McNamara contacted Mohawk’s president, requesting that Mohawk investigate the matter. He also asked Mohawk to transfer Roselli off the job site, but Mohawk refused to remove him or to discipline him. On November 10, Edmands noticed that the portable toilet facility had been defaced with graffiti, consisting of the word “HERS” written above a drawing of an eye and, below the eye, a cmde caricature of female genitalia. Edmands understood that the graffiti was directed at her, and that it referred to the prior week’s incident. She encountered Cofield and Ell a short time later; Cofield again promised to “take care of this,” and the graffiti was removed. Following up on McNamara’s suggestion about the videotapes, Edmands reviewed the tapes on November 15. However, the camera angle was such that, despite reviewing the tapes twice, Edmands still could not make any identification. Two days later, George Coblyn, Modem’s equal employment opportunity officer, spoke with Edmands and asked her to give him a written statement concerning both the original peeping and tie wiring incident and the graffiti incident. She provided him with such a statement two weeks later. That statement contained no identification of either the perpetrators or of any potential witnesses. Coblyn also contacted employees and officials at Mohawk. They refused to provide him with any information concerning the identity of the perpetrator of either the peeping incident or the subsequent graffiti. On November 23, Coblyn gave a brief presentation on the subject of sexual harassment, including a warning that sexual harassment would not be tolerated at the site, at a regular gathering of workers, managers, and union representatives referred to as “tool box talks.” However, very few persons attended that particular tool box talk. Without Edmands’s knowledge, her union initiated a grievance with respect to these incidents, and on December 7, she was called to attend a step one grievance meeting. In addition to various officials from Modem, the meeting was attended by the ironworkers’ union business agent, Sonny Oliver; the ironworkers’ steward, Jay Kennedy; and Roselli. Oliver, on behalf of the ironworkers, dominated the meeting. Oliver denied that anyone had peered into the toilet facility while Edmands was using it. He also insisted that the facility had been shut with a tie wire in order to prepare for its removal by a crane (a version contrary to Roselli’s prior admission that he had tie wired the facility as a prank). McNamara repeated his request that Roselli be transferred off the project. At that, the ironworkers threatened to strike if Roselli were removed. Oliver also raised issues concerning the cleanliness of the toilet facilities. There ensued some discussion concerning the security and cleaning of the facilities, resulting in a “general agreement” that certain of the toilets would be designated for exclusive use by female workers (instead of being entirely unisex, as they had been until that point), and that they would be separated from the men’s toilets, set off by fencing, and secured with padlocks. However, from the date of the original November 3 incident onward, Edmands had opted to use the bathroom facilities at a building one-quarter mile away, and she continued to do so even after these additional security measures were later instituted. Although unable to convince Mohawk to remove Roselli, and unable to uncover the identity of any other perpetrator, McNamara revised the work schedule at the site so that iron work would be done at a different location (some 500 to 700 yards from where Edmands worked) and on a different shift. Although Edmands still would encounter Roselli (and other ironworkers) at shift changes, she would not be working with ironworkers in the immediate vicinity. McNamara had been skeptical of the efficacy of padlocking the newly-designated female toilet facilities, but he carried through with the ordering of separate facilities, the placement of signage, the installation of padlocks, and the issuance of padlock keys to female employees. Within a few weeks, the padlocks on the women’s toilets disappeared. Some fencing was erected, but quickly fell down or was removed. And, instead of placing the facilities in separate locations, the women’s toilets were frequently placed side by side next to the men’s toilets. In February, 1994, a step two grievance meeting was held, attended by Edmands, officials from the carpenters’ union, and officials from Modem. Although she was not using the facilities in any event, Edmands complained that Modem had failed to carry through on its agreement to separate, fence, and lock the women’s portable toilets. Modem took the position that fencing had been a suggestion at the prior meeting, but not an agreed item. At the step two meeting, it was agreed that the female facilities would be kept separate, surrounded by fencing, and locked. In addition, a security monitor would be hired, assigned to report on any further problems, including any incidents of sexual harassment or graffiti. Finally, Modem confirmed that Roselli had been moved to a different location and different shift. Based on the results of the step two grievance meeting, the carpenters’ union, with Edmands’s agreement, decided not to take the matter to arbitration. On March 21, 1994, as Edmands was entering her work trailer, she encountered her foreman, Cofield, erasing graffiti. Edmands did not see the graffiti, but Cofield informed her that it had consisted of depictions of male and female genitals. By late March or early April, 1994, the task that ironworkers had been assigned at a different location and shift was completed. As a result, Roselli and the ironworkers returned to the day shift, working in a location near Edmands. Shortly thereafter, the monitor hired to patrol the toilet facilities discovered some graffiti in the men’s toilet facilities that referred to Edmands in vulgar terms, and brought it to Coblyn’s attention. (Edmands did not see it.) Coblyn in turn reported this new outbreak of graffiti to McNamara, who instructed him to draft a memorandum, to be distributed to all workers at the site over McNamara’s signature, responding to the incident. Thereafter, Coblyn supplied McNamara with the requested draft memorandum. Instead of distributing the notice drafted by Coblyn, McNamara drafted his own notice, which focused on the specific problem of vulgar graffiti. That notice was distributed to all workers with their paychecks. Later that month, Edmands told Coblyn that she was tired of working in an environment that made her “nervous and scared,” where people were “so angry at [her] for just wanting to work.” She also contacted her union and asked to be transferred to a different job site. Coblyn suggested that she could be transferred to work in a facility referred to as “the mill,” which was part of the same project but at a removed location. Although some workers considered the mill a better assignment (as it was a more comfortable indoor site with more amenities), Edmands considered the work at the mill to be less challenging and a less valuable experience than work in the field. She nevertheless agreed to the transfer. At the mill, Edmands’s foreman, Steve Pema, remarked that, in his view, women working outside the home were adversely affecting the economy. He then clarified that he was referring to women of his own age (i.e., of an age significantly older than Edmands). When Edmands reported these remarks to an equal employment opportunity officer, the officer told her that Pema’s inappropriate comments used to be worse. Edmands quit her job at Modem in May, 1994, and went to work for a technology company as a software engineer. The hearing commissioner found that the incidents were sexual in nature or, even if not explicitly sexual in nature, that they had been directed at Edmands because of her sex; that their cumulative effect was sufficiently severe that it impacted Edmands’s working environment and triggered a duty on the part of Modem to take action; and that Modem’s response to these incidents of harassment was inadequate. He therefore found Modem liable for sex discrimination, awarded Edmands $50,000 in damages for emotional distress, and ordered Modem to submit and implement a plan acceptable to the MCAD to train all of Modem’s Massachusetts employees concerning “the legal requirements of nondiscrimination in the workplace.” Modem appealed to the full commission, which affirmed the hearing commissioner’s decision in all respects and awarded Edmands attorney’s fees and costs. 2. Discussion, a. Employer’s liability for harassing acts committed by third parties. Modem contends that, as a matter of law, it cannot be held liable for the conduct of independent third parties over whom it did not have control. The only known perpetrators of the harassing acts at the project site were ironworkers employed by Mohawk; there was no evidence of any such acts committed by employees or agents of Modem. Modem’s argument relies on the literal wording of the statutory prohibition against sexual harassment: it is an unlawful practice “[f]or an employer, personally or through its agents, to sexually harass any employee” (emphasis added). G. L. c. 151B, § 4 (16A). Mohawk was an independent subcontractor, and Mohawk’s offending employees were not the “agents” of Modem. However, in addition to the prohibition set forth in § 4 (16A), Modem is also prohibited from discriminating against its own employees on the basis of sex (including discrimination with respect to the “conditions” of employment), G. L. c. 15IB, § 4 (1); and discrimination on the basis of sex includes sexual harassment, G. L. c. 151B, § 1 (18). An employer who passively tolerates the creation of a hostile working environment implicitly ratifies the perpetrator’s misconduct and thereby encourages the perpetrator to persist in such misconduct, whatever the employer’s precise legal relationship to the perpetrator. Moreover, acquiescence on the part of the employer effectively communicates to the victim of harassment that her employer does not care about the hostile environment in which she must work, a message that can only operate to exacerbate the adverse effects of that hostile environment. In this context, an employer who is not part of the solution inevitably becomes part of the problem. Bearing in mind that the statute “shall be construed liberally for the accomplishment of [its] purposes,” G. L. c. 151B, § 9, we decline to read it in a manner that would absolve an employer of all responsibility for a hostile work environment merely because that hostile work environment is attributable to persons who are not the employer’s own employees or agents. The MCAD guidelines on the subject of sexual harassment provide that an employer may, in some circumstances, be held liable for sexual harassment perpetrated by persons who are not employees of the employer. Massachusetts Commission Against Discrimination Guidelines: Sexual Harassment in the Workplace § IDLC (2002) (MCAD Guidelines). Specifically, liability may be imposed where the employer knew or should have known of the harassing conduct but “failed to take prompt, effective and reasonable remedial action.” Id. The MCAD Guidelines recognize that an employer may have less control over perpetrators who are not its own employees, and the factor of control is to be taken into consideration in determining whether the employer should be held liable: “The primary difference between employer liability for harassment perpetrated by co-workers and harassment committed by non-employees lies in the ability of the employer to control the conduct of the non-employees. The greater the employer’s ability to control the non-employee’s conduct, the more likely it will be found liable for that person’s unlawful harassment.” Id. Where the Legislature has expressly delegated to the MCAD the task of “formulat[ing] policies to effectuate the purposes” of G. L. c. 151B and given it authority to “adopt, promulgate, amend, and rescind rules and regulations” to implement the statute, G. L. c. 151B, §§ 2, 3 (5), we accord substantial deference to the MCAD’s interpretive guidelines. See Dahill v. Police Dep’t of Boston, 434 Mass. 233, 239 (2001), and cases cited. Here, the MCAD’s interpretation is a reasonable one, whereas the interpretation proposed by Modem would seriously undermine the objective of eliminating sexual harassment in the workplace. The MCAD’s interpretation is also consistent with a considerable body of Federal precedent interpreting comparable provisions of Title VII of the Civil Rights Act of 1964. Regulations of the Equal Employment Opportunity Commission (EEOC) interpreting Title VII recognize that an employer may be liable for sexual harassment perpetrated by third parties: “An employer may also b