On June 24, 2013, the United States Supreme Court, in a 5-4 decision authored by Justice Alito in the matter of Vance v. Ball State University, held that “[a]n employer may be vicariously liable for an employee’s unlawful harassment only when the employer has empowered that employee to take tangible employment actions against the victim, i.e., to effect a ‘significant change in employment status, such as hiring, firing, failing to promote, reassignment with significantly different responsibilities, or a decision causing a significant change in benefits.’”

Effectively, the Vance decision makes it difficult for employees to sue employers for on-the-job harassment. While employers have generally been held strictly liable for harassment by supervisors, the Court’s decision limits employers’ liability to instances where the harassing supervisor was empowered “to take tangible employment actions,” such as hiring and/or firing employees. Hereafter the standard that will be applied to harassment by supervisors not empowered to take “tangible employment action” will be the same as is already applied to instances where the alleged harassment comes from co-workers – negligence. Specifically, the employer will only be held liable for the underlying harassment of a supervisor not empowered with “tangible employment action” (or a co-worker) if the employer is somehow negligent.

The implications of the Court’s decision are far-reaching for several reasons. Other than the immediate ramifications on existing harassment cases, the Court’s decision provides employers with ample incentive to creatively define the scope of authority their “supervisors” are given over employees, restricting “tangible employment action” authority to a much narrower pool of supervisory or managerial positions.
It should be noted, however, that this limitation applies only to federal employment discrimination cases brought under Title VII of the Civil Rights Act of 1964, and does not affect broader states’ rights protections provided under state statutory schemes.

Justices Ginsburg, Breyer, Sotomayor, and Kagan dissented to the Court’s opinion.