Lead Opinion
The City of Sioux City appeals from a jury verdict in favor of Cheryl Davis on her claims of retaliation and hostile environment sexual harassment. We affirm in part and reverse in part.
I. BACKGROUND
Cheryl Davis began working for the City of Sioux City (City) in the City Clerk’s Office in 1977. In 1984, Davis became a Deputy Clerk. From 1982 to 1992, Bill Gross was the City Clerk and Davis’s supervisor. Gross, in turn, reported directly to the City Council, which had sole responsibility fqr hiring, firing and disciplining him.
During the first nine years that Davis worked under Gross, Davis claims Gross engaged in some inappropriate behavior toward her. However, Davis did not feel that this behavior was sufficiently egregious to report. In January 1991, however, Gross suffered a heart attack. Following his return from medical leave, and especially in late 1991 and early 1992, Gross’s inappropriate behavior
Pursuant to the City’s sexual harassment policy that had been in effect since 1988, Davis made a formal complaint about Gross’s behavior on February 12, 1992. In the course of an investigation by city personnel, Gross denied Davis’s allegations. Later, the investigators’ findings were submitted to the City Council. Davis was neither apprised of the investigation nor of the substance of the report. After discussing the report on March 16, 1992, the City Council voted to suspend Gross for one day and put a letter in his file. Davis was not informed of this action at the time.
On the morning of March 25, 1992, Davis submitted a letter of resignation and left her office. That same day, a letter was prepared by the City Council notifying Davis about Gross’s one-day suspension. Later that afternoon, Davis met with an attorney for the City and informed him that she had obtained some of Gross’s personal notes which suggested Gross had lied to investigators. On March 30, 1992, these notes were presented to the City Council. On review of this evidence, the City Council negotiated and concluded a severance agreement with Gross, who left city employment on April 3, 1992.
Davis was then asked to withdraw her resignation. Due to reorganization of city offices, however, Davis’s prior Deputy Clerk position had been eliminated. Davis was offered a new job as a property officer in the Community Development Department. The beginning annual salary at this new position was slightly more than Davis’s previous salary. However, Davis testified that the opportunities for pay increases and job advancement were fewer than in her prior role and that the new position was not a supervisory one, in contrast to her Deputy Clerk responsibilities. Additionally, Davis claims the new position ended within two years unless she successfully completed a civil service exam. Davis accepted the appointment, however, and continues to work in that capacity.
In June 1994, Davis filed sexual harassment and retaliation claims against the City and several of its officers.
II. DISCUSSION
A. Hostile Environment Jury Instruction
On appeal, the City argues that the district court erred in instructing the jury on the hostile environment sexual harassment claim because the instruction allowed the jury to find for Davis upon a mere finding of agency, without regard to whether Gross’s actions were properly imputed to the City.
We review the district court’s jury instructions for an abuse of discretion. Sherbert v. Alcan Aluminum Corp.,
In the situation of quid pro quo sexual harassment by a supervisor, where thé harassment results in a tangible detriment to the subordinate employee, liability is imputed to the employer. Meritor Sav. Bank, FSB v. Vinson,
In Smith v. St. Louis University, we used the knew or should have known standard in a case of supervisor-caused hostile environment sexual harassment. Smith,
The Smith ease is consistent with our other decisions. See, e.g., Callanan v. Runyun,
Finally, we note the case of Kinman v. Omaha Public School District,
The Supreme Court in Meritor Savings declined to set out a generally applicable standard of liability for employers under Title VII. Instead, the Court suggested that common law agency principles should guide courts in determining employer liability on a case-by-case basis. For example, when a supervisor uses the power delegated specifically to him by his employer to discriminate on the basis of sex, that employee’s actions should be imputed to the employer. On the other hand, in a hostile environment sexual harassment*1369 ease, the usual basis for a finding of agency will often disappear. In such cases, the em/ployer should not be held liable unless the employer itself has engaged in some degree of culpable behavior. For example, the employer could be held liable if it knew or should have known of the harassment and failed to take appropriate remedial action.
Id, at 469 (citations and quotations omitted) (emphasis added).
Therefore, we find that the district court abused its discretion in not instructing the jury on the knew or should have known employer liability standard. Consequently, we reverse and remand for a new trial on this issue. On retrial, the jury may well reach the same verdict, but must do so after being instructed on the appropriate liability standards.
B. Retaliation Claim
To prove unlawful retaliation, Davis must show that she complained of discrimination, the City took adverse action against her, and the adverse action was causally related to her complaint. Marzec v. Marsh,
On review of the jury’s verdict, we view the evidence in the light most favorable to the prevailing party. Elliott v. Byers,
We have considered the remainder of the City’s arguments and find them to be without merit.
III. CONCLUSION
Because the district court erred in instructing the jury on Davis’s hostile environment sexual harassment claim, we reverse and remand that claim for a new trial. Finding no error in the jury’s verdict for Davis on the retaliation claim, we affirm as to that claim. The case is remanded to the district court for proceedings consistent with this opinion.
Notes
. The individual officers were later dismissed from suit. Additionally, several other claims originally filed by Davis and her husband were dismissed. Davis’s hostile environment sexual harassment and retaliation claims were the only claims that proceeded to trial and are the only claims at issue in this appeal.
. On the sexual harassment claim, the jury awarded $4,100 for back pay, $4,090 for medical expenses and $20,000 for emotional distress damages. On the retaliation claim, the jury awarded $4,250 for back pay, $40,000 for front pay and $30,000 for emotional distress damages.
.The jury was instructed that its verdict must be for the plaintiff if the following elements were met: (1) plaintiff was subjected to sexually offensive conduct; (2) such conduct was on account of plaintiff's gender; (3) such conduct was sufficiently severe or pervasive so that a reasonable woman would find the work environment to be hostile; (4) plaintiff believed her work environment to be hostile; and (5) "The alleged harasser, Bill Gross, who was the supervisor of the plaintiff, was an agent of the City of Sioux City as described in the next instruction.” The following explanatory instruction was then provided:
*1367 With respect to the fifth element of Instruction 9, which is whether or not Bill Gross, who was a supervisor of the plaintiff, was an agent of the City of Sioux City, you should apply the following principles. Defendant City of Sioux City is a corporation. A corporation may act only through natural persons as its agents or employees and, in general, any agent or employee of a corporation may bind the corporation by his or her actions done and statements made while acting within the scope of his or her authority as delegated to him or her by the corporation or within the scope of his or her duties as an employee of the corporation. An employee acting outside his or her delegated authority or outside the scope of his or her duties of employment may not bind the corporation. However, even though an act is forbidden, such as sexual harassment in this case, it may still be within the scope of employment so as to impose liability on the corporation. In deciding whether the act complained of was within the scope of employment you should consider such factors as where the acts took place and all of the other evidence before you.
Addendum to Appellant's Brief at 6-7.
. We recognize those cases cited by the dissent which impute liability to an employer for a supervisor's hostile environment sexual harassment of an employee, regardless of the employer's actual or constructive knowledge of the harassment. We decline to follow such reasoning in this case because there is contrary binding precedent in this circuit. Furthermore, imputation of liability to the City in this cáse, without regard to City decision makers’ knowledge of Gross’s acts, would be inappropriate. As the dissent makes clear, the knowledge requirement may be dropped where “someone at the decision-making level in the coiporate hierarchy has committed the wrong." Infra at 1370-71 (quoting Hunter v. Allis-Chalmers Corp.,
Although the record is replete with examples of the decision-making responsibility of the City Council, little is said of Gross’s responsibilities. The City Council ordered an investigation into the harassment; forced Gross to resign; and transferred Davis to a new position. These are but a few examples of the fact that the City Council, not Gross, was vested with control over the City Clerk’s Officé. Indeed, after Gross resigned from the City Clerk position, the entire City Clerk Office was relegated to being one of many departments under the supervision of the City Manager. Such reorganization further demonstrates the relative'powers of the City Clerk and the City Council.
Therefore, notice to the City’s decision-making hierarchy, whether actual or constructive, of Gross's actions should be required. -Any other rule would render the Cily's attempts to prevent sexual harassment, such as its anti-harassment policy and training, a waste of time. Even if the rule urged by the dissent were appropriate for some cases, this is not such a case.
. The elements include: (1) plaintiff is in a protected group; (2) plaintiff was subjected to unwelcome harassment; (3) the harassment was based on plaintiff’s sex; (4) the harassment affected a term, condition, or privilege of plaintiff’s employment; and (5) the employer knew or should have known of the harassment and failed to take proper remedial action. Hall v. Gus Constr. Co.,
. The dissent uses the Kinman case in support of its position. Omitted from its quoted Kinman text, however, is important prefatory language which explains the Kinman court’s reasoning. After quoting Kinman for the proposition that "when a supervisor uses the power delegated specifically to him by his employer to discriminate on the basis of sex, that employee’s actions should be imputed to the employer,” the dissent then concedes, “[t]he [Kinman] opinion does add that "in a hostile environment sexual harassment case, 'the usual basis for a finding of agency will often disappear.’ ” ” Infra at 1370 (quoting Kinman,
. Meritor suggests that another example of an employer’s culpable conduct could be the absence of an anti-sexual harassment policy with a supervisor-bypass provision.
Concurrence Opinion
concurring in part and dissenting in part.
I agree with the Court that the judgment on the retaliation claim should be upheld, but I respectfully dissent from the Court’s action on the harassment claim.
In my view, the District Court’s instructions to the jury were correct. If we look to general “agency principles,” Meritor Savings Bank v. Vinson,
I briefly restate the facts. Mr. Gross was the top person in the city clerk’s office. He
The panel cites Smith v. St. Louis University,
Callanan v. Runyun,
The most persuasive authority cited by the Court is Kinman v. Omaha Public School District,
I would hold that a district court may give an instruction along the lines of the one given in this case when the alleged harasser is a high-level supervisor, and his acts can therefore be imputed directly to the employer. Meritor instructed courts to look to general “agency principles” to decide when the harassing acts of an employee can be imputed to an employer. Meritor,
A corporate or governmental entity cannot act by itself. Their personification is a legal fiction, and they can effectuate their goals only through their agents. See Hunter v. Allis-Chalmers Corp.,
Since the acts of a corporation are acts of human beings, to say that the “corporation” has committed some wrong ... simply means that someone at the decision-making level in the corporate hierarchy has committed the wrong; the deliberate act of such a person is the corporation’s deliberate act.... Whether his superiors know or should have known what he did is irrelevant; it becomes relevant only where the wrong is committed by someone below the managerial level.
Ibid. Likewise, the entity does not itself have a mental capacity by which it can gain knowledge of its employees’ wrongdoings. The employer necessarily relies on its agents to ensure that it complies with the laws and does not become subject to liability. When an employer gives a person essentially plenary authority over a department, as the city gave Gross here, that person is the employer for purposes of Title VII, and his acts within the scope of employment are done with the knowledge of the employer, because he necessarily, as the employer, has knowledge of his own actions. See Sauers v. Salt Lake County,
Of course, to hold the employer liable, its tortfeasing employee must have been acting within the scope of employment. This is not too difficult to show, particularly in this case, for acts on the employer’s premises, or during errands at his behest, or other acts plausibly related to employment will meet this standard. See, e.g., Doe by Doe v. B.P.S. Guard Services, Inc.,
Most circuits that have considered the issue have resolved it as I would. See Karibian v. Columbia University,
