Cerdeira v. Martindale-Hubbell, A-5855-06T1 (App. Div., September 18, 2008) – In this case, the Appellate Division for the first time held that an employer can be liable for co-worker harassment based upon negligent failure to have in place an effective and well-publicized sexual harassment policy.

The plaintiff was subjected to sexually harassing conduct by a co-worker who was not a supervisor, and plaintiff never reported the conduct to company officials. When the company learned of it, the harassing employee was immediately suspended and terminated two days later. Plaintiff nonetheless sued, claiming the employer fostered a hostile work environment. The Court rejected the company’s argument that it could not be liable for conduct about which it had no knowledge. It found that the concept of a negligence-based theory of liability for failing to institute a policy, as discussed in Lehmann v. Toys ‘R’ Us, 132 N.J. 587 (1993), applies equally to claims of non-supervisory harassment. Otherwise, employers might be discouraged from adopting proactive sexual harassment policies that are wellpublicized and directed to all employees.

This decision makes it even more critical for all employers to have in place a specific and detailed anti-harassment policy outlining the complaint procedure, as well as the need to provide antiharassment training to all employees, not just supervisors