An employer’s duty to protect employees from unlawful harassment extends to harassment by customers and other third parties. Employers forget this at their peril.

The EEOC recently fi led a complaint against Fred Meyer Stores Inc. alleging that the company failed to protect three female employees from sexual harassment by a customer. The complaint alleges that Fred Meyer failed to take action after the employees reported that a male customer would rub against them, give unwanted hugs and grope their bodies while they attempted to clock in and out. According to the EEOC’s lawsuit, the manager dismissed the employee’s complaints as “rumors” and in one instance directed an employee to “keep her voice down” when she told the customer to leave her alone. As a result, Fred Meyer is now in the hands of litigators.  

Fred Meyer is not alone. In Lockhard v. Pizza Hut, Inc., 162 F.3d 1062 (10th Cir. 1998), the Tenth Circuit Court of Appeals upheld a jury verdict of $200,000 in compensatory damages against an Oklahoma Pizza Hut franchisee for allowing a hostile work environment created by customers who sexually harassed a waitress. The waitress had complained to her supervisor that the customers were making sexually offensive comments, and she requested permission not to wait on them. Her supervisor refused. The men again made offensive comments and one grabbed her by the hair. The waitress reported the incident to her supervisor and again requested that she be relieved from waiting on the customers. Her supervisor again refused. When the waitress returned to the table, one of the customers grabbed her hair, then grabbed her breast, and fi nally put his mouth on her breast. The waitress quit and sued her employer, and she ultimately prevailed.

Both cases serve as good reminders that employers have a duty to protect employees from sexual harassment (and other prohibited harassment) even if the harasser is a customer or client. Under Title VII, an employer is liable for harassment by third parties when its supervisors or managers know or should know of the conduct and fail to take prompt action that is reasonably calculated to end the harassment and prevent its recurrence. That action need not be at the cost of doing business with the customer. For example, in the Pizza Hut case, the manager could have sent a male waiter to the table rather than require the waitress to continue serving the male customers. In a commercial setting, requesting that a corporate customer designate a new representative can end harassment by an individual while preserving the relationship with the customer itself.  

Although it may present challenges when the harasser is a client, vendor, or other third party, failing to take steps to stop the harassment can be an expensive mistake. Employers should train their supervisory employees on the company’s sexual harassment policies and make clear to them and the workforce at large that the anti-harassment policies also apply to third parties such as customers and vendors.