Kitchen-Sink Guidance On Harassment, Retaliation and Joint Employment Issues

A recent case from the Court of Appeal for the Second Appellate District is a veritable  grab bag of issues for employers.  You name it – the court gave guidance on harassment, retaliation, and joint employer issues in McCoy v. Pacific Maritime Association.

McCoy worked for over a decade as clerk for terminal operator Yusen when she and several coworkers filed a federal discrimination lawsuit against their employer.  The lawsuit led to a confidential settlement between the parties.  Under the settlement, Yusen was required to train McCoy to be a vessel planner, a more prestigious position.

McCoy subsequently sued PMA, an organization that serves as a bargaining agent for Yusen, the employer, alleging that she was sexually harassed and suffered emotional distress during the vessel planner training, and that she was retaliated against due to the filing of the previous lawsuit.  Apparently, the harassment consisted of a co-worker’s comment about the buttocks of other female employees and his crude gestures toward a woman when her back was turned.  None of the sexual comments were directed at her.

The Court of Appeal affirmed the dismissal of McCoy’s sexual harassment claim, reasoning that although the comments were crude and offensive, the conduct, which occurred only five to nine times over a four-month period, did not create a work environment “permeated” with sexual harassment.  Moreover, the employee making the offensive remarks was not McCoy’s supervisor, and McCoy admitted she never mentioned the remarks or anything about sexual harassment to management.  Thus, there was no evidence that PMA knew or should have known of the alleged harassment and failed to take appropriate action.

On the retaliation claim, however, a jury awarded McCoy $1.2 million in damages, but the trial court granted PMA’s motion for judgment notwithstanding the verdict.  On appeal, the court ruled that the trial court had erred in excluding McCoy’s “me-too” evidence by other coworkers who complained they were retaliated against due to their participation in the same lawsuit as McCoy and who received the same training as McCoy as a result of the settlement.  Because the consideration of “me-too” evidence is fact intensive, the Court opined that the trial court should have at minimum conducted a hearing to ascertain the details of the evidence and similarity to McCoy’s claims before subjecting it to blanket exclusion.

The Court of Appeal also held that, aside from the “me too” evidence, there was substantial evidence from which a jury could find retaliation.  Yusen did four things that could support a retaliation verdict: (1) it exposed details of the confidential settlement agreement to McCoy’s supervisor; (2) it tolerated the offensive remarks by McCoy’s co-workers; (3) it denied her needed assistance; and (4)  it gave her substandard training compared to the other trainees.   

As for PMA, the court found it was not an employer under the FEHA.  Although PMA negotiated labor contracts on Yusen’s behalf, Yusen paid McCoy, supervised her and employed the co-workers who allegedly retaliated against her. 

This case is a reminder that even when an employer is not held liable for sexual harassment, employers can steal defeat from the jaws of victory by retaliating against employees.

Amy Durgan

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