What Are The Implications of An Anti-Fraternization Policy As Applied To Non-Supervising Coworkers?

The Implications of an Anti-Fraternization Policies As Applied to Non-Supervising Coworkers

By Navid Yadegar and Navid Soleymani, our Los Angeles employment lawyers

Since the decision of the California Court of Appeals in Barbee v. Household Automotive Finance Corp., 113 Cal. App. 4th 525 (2003), employers have been assured that anti-fraternization policies which prohibit sexual and/or romantic relationships amongst supervisors and subordinates are enforceable. What has been largely absent from this discussion is whether anti-fraternization policies that apply to co-workers (who are not in supervisor-subordinate positions) also are enforceable.

Some commentators have suggested that anti-fraternization relating to co-workers should merely require a reporting obligation and not prohibit such relationships. That reporting policy, however, likely runs afoul of California privacy laws

The Privacy Laws Protect An Employee Against Mandatory Disclosures

The constitutional right to privacy is well-established and is found in both the United States and California Constitutions. See, e.g., Hill v. National Collegiate Athletic Assoc., 7 Cal. 4th 1, 15-20 (1994); Lawrence v. Texas, 539 U.S. 558 (2003). “Article I, section of the California Constitution is an enumeration of the “inalienable rights” of all Californians. ‘Privacy’ is declared to be among those rights.” Hill, 7 Cal. 4th at 16.

Under California law, the right to privacy applies against private actors, not just governmental entities. Hill, 7 Cal. 4th 1, 15-20 (1994) (“Privacy is protected not merely against state action; it is considered an inalienable right which may not be violated by anyone”).

The right to privacy can be used to challenge a private employer’s policy or agreement with its employees. A policy or agreement that violates the employee’s right to privacy is void and unenforceable. An employer may not “enforce such a contractual agreement if it intrud[es] on [an employee’s] right to privacy…. [T]he agreement would be unenforceable because it would be against public policy.” Semore v. Pool, 217 Cal. App. 3d 1087, 1097 (1990) (holding that an employee may assert a claim for wrongful violation of public policy, for refusing to take a random drug test in violation of his constitutional right to privacy); see also Clausing v. San Francisco Unified Sch. Dist., 221 Cal. App. 3d 1224, 1238 (1990) (the Constitutional provision protecting the right to privacy is “self-executing” and supports a cause of action for equitable relief).

The right to privacy is not only a basis on which to challenge an employer’s policy or agreement, but it also gives rise to a cause of action for invasion of privacy. A cause of action for invasion of privacy has three elements: (1) a legally protected privacy interest; (2) a reasonable expectation of privacy in the circumstance; and (3) conduct by defendant constituting a serious invasion of privacy. Hill, 7 Cal. 4th at 35.

Employees Have a Legally Protected Privacy Right

Courts have broadly described two categories of legally recognized privacy interests: (1) interests in precluding the dissemination or misuse of sensitive and confidential information (“informational privacy”); and (2) interests in making intimate personal decisions or conducting personal activities without observation, intrusion, or interference (“autonomy privacy”). Hill, 7 Cal. 4th at 30. “Whether a legally-recognized privacy interest is present in a given case is a question of law to be decided by the court.” Id. at 40.

In the context of an obligation to report a sexual or romantic relationship to an employer, both informational and autonomy privacy rights are implicated –i.e., an employee’s right to pursue a consensual relationship with whomever she chooses, and to keep the fact of that relationship private from others. There is nothing more quintessentially private than an individual’s physical, romantic, and personal relationships with others. The right to privacy in one’s personal relationships has been recognized under both federal and state law; indeed, the issue has even reached the United States Supreme Court. Lawrence, 539 U.S. 558.

In Lawrence, 539 U.S. 558, the Supreme Court held that individual decisions by married and unmarried person “concerning the intimacies of their physical relationship . . . are a form of ‘liberty’ protected by the Due Process Clause of the Fourteenth Amendment.” Lawrence, 539 U.S. at 578. “Moreover, this protection extends to intimate choices by unmarried as well as married persons.” Id. The Court noted “an emerging awareness that liberty gives substantial protection to adult persons in deciding how to conduct their private lives in matters pertaining to sex.” Id. at p. 572.

The California Supreme Court has construed the California Constitution to provide broader protection in employment litigation than the privacy rights guaranteed by the U.S. Constitution. American Academy of Pediatrics v. Lungren, 16 Cal. 4th 307, 327-28 (1997); see also Barbee v. Household Automotive Finance Corp., 113 Cal. App. 4th 525, 531 (2003) (“The state constitutional right to privacy provides protection that is distinct from, and some respects greater than, that provided by the federal Constitution.”). “[I]n the wake of Lawrence,” the California Court of Appeal recognized that one “may have a legally protected privacy interest in pursuing an intimate or sexual relationship.” Barbee, 113 Cal. App. 4th at 531.

Other California Courts of Appeal have similarly recognized the constitutional privacy right to pursuing intimate or sexual relationships and to keeping such relationships private from others. See Vinson v. Superior Court, 43 Cal. 3d 833, 841 (1987) (“California accords privacy the constitutional status of an ‘inalienable right,’ on a par with defending life and possessing property…. California’s privacy protection similarly embraces sexual relations”); Barrenda L. v. Superior Court, 65 Cal. App. 4th 794, 800 (1998) (the right to privacy “protects both the marital relationship and the sexual lives of the unmarried”);Roman Catholic Bishop v. Superior Court, 42 Cal. App. 4th 1556 (1996) (recognizing an employee’s constitutional right to privacy, stated that “the employer who queries employees on sexual behavior is subject to claims for invasion of privacy and sexual harassment”).

Non-Supervising Employees Have An Expectation of Privacy in Their Romantic Relationships with Coworkers

The second element of a privacy claim is a reasonable expectation of privacy, which “is an objective entitlement founded on broadly based and widely accepted community norms.” Hill at 37. “[C]ustoms, practices, and physical settings surrounding particular activities may create or inhibit reasonable expectations of privacy.” Id. at 37.

The only cases to have analyzed an employee’s expectation of privacy in the face of an anti-fraternization policy involve romantic relationships betweensupervisors and subordinates. Because of the unique issues presented by those relationships, courts have held that employees who engaged in relationships with their supervisors or subordinates have a reduced expectation of privacy. See, e.g., Barbee, at 113 Cal. App. 4th at 533.

In Barbee, Robert Barbee was the national sales manager for the company. He dated a member of his sales staff, Melanie Tomita. Barbee was Tomita’s boss. The company had a policy against inter-office relationships, but the policy applied only to relationships between supervisors and subordinates. When rumors surfaced of the relationship, Barbee was given the choice of breaking off the relationship or being fired. Barbee persisted in the relationship, was terminated, and sued the company for violation of his right to privacy.

The Court of Appeal held that “supervisors have [no] privacy right to engage in intimate relationship with their subordinates.” Barbee, at 113 Cal. App. 4th at 533 (emphasis added). Relying on a long line of cases upholding restrictions against “management-subordinate relationships,” the court reasoned that such relationships present issues of potential sexual harassment and create the appearance of favoritism. Id. at 532-33. As a result, Barbee, a supervisor, had no reasonable expectation of privacy in pursuing an intimate relationship with Tomita, his subordinate. Id. at 533.

Every case on which Barbee relied, and every justification advanced by Barbee, related to relationships between supervisors and subordinates. In fact, there is not a single case that holds that two co-workers, with no reporting or supervisory relationship with each other, lack a reasonable expectation of privacy in pursuing a relationship with each other. That is because the enforcement of anti-fraternization policies as between managers and subordinates is justified by the unique issues presented by those relationships. See Crosier v. United Parcel Serv., Inc., 150 Cal. App. 3d 1132, 1140 (1983), disapproved on other grounds by Foley v. Interactive Data Corp., 47 Cal. 3d 654 (1988) (employers are “legitimately concerned with appearances of favoritism, possible claims of sexual harassment and employee dissension created by romantic relationships between management and non-management employees”); Parks v. City of Warner Robins, 43 F.3d 609, 614 (11th Cir. 1995) (upholding an anti-nepotism policy because “[t]he true intent and direct effect of the policy is to ensure that no city employee will occupy a supervisory position vis-a-vis one of his or her relatives”); Anderson v. City of LaVergne, 371 F.3d 879, 882 (6th Cir. 2004) (upholding policy prohibiting dating amongst police officer of “different ranks” because it promoted an interest in avoidingsexual harassment suits”).

The implicit distinction drawn by Barbee – between co-worker relationships and supervisor-subordinate relationships – is an important one and is based on California and federal law. “As a general proposition, only a supervisor, or other person acting with the authority of the company, can cause [a tangible employment action].” Burlington Industries, Inc. v. Ellerth, 524 U.S. 742, 762 (1998) (emphasis added). In other words, “[t]angible employment actions fall within the special province of the supervisor.” Id. As a result, courts have held that an employer is vicariously liable for sexual harassment committed by a supervisor. Fiol v. Doellstedt, 50 Cal. App. 4th 1318, 1331 (1996) (“If a supervisor sexually harasses an employee, the … employer is vicariously and strictly liable for the harassment”).

On the other hand, with very limited exceptions, an employer is not “vicariously liable” for a hostile work environment allegedly created by non-supervising co-workers. See Chin, Wiseman, et al., Cal. Practice Guide: Employment Litigation (Rutter Group 2012) ¶ 10:395 (“[t]he employer is not vicariously liable for hostile environment sexual harassment created by plaintiff’s coworkers or others (as opposed to plaintiff’s supervisor.”). The only way an employer can be liable for harassment claims based on a non-supervising co-worker’s conduct is if the employer knew, or should have known, of the employee’s improper conduct and failed to take immediate and appropriate corrective action. In other words, in this context, an employer is liable only for its own action or non-action, and not as a result of vicarious liability. Cal. Gov. Code §12940(j)(1) (California law); 29 CFR §1604.11(d) (Federal law); see Rieger v. Arnold, 104 Cal. App. 4th 451, 464 (2002) (employer can be held liable for harassing conduct of its nonsupervisory employees only “if it was or should have been aware of them and did not take remedial measures”).

Accordingly, a co-worker who dates another co-worker, with whom there is no supervisory relationship, can state a sexual harassment claim against FMG only if: (a) the other employee engages in sexually harassing conduct toward the other, and (b) FMG becomes aware of the sexually harassing conductand (c) FMG fails to take immediate and appropriate corrective action. FMG can avoid sexual harassment liability in this scenario simply by enforcing its existing sexual harassment policy and taking immediate and appropriate action when it learns of potentially inappropriate conduct. There is no need or justification to prophylactically prohibit or otherwise regulate the relationship in the first instance. This scenario stands in stark contrast to that presented in Barbee, where any improper conduct committed by the supervisor would have been imputed to the employer through the vicarious liability doctrine.

Similarly, the favoritism issue cited by Barbee is a concern in the case of a supervisor-subordinate relationship – but not in a co-worker relationship. A claim of favoritism by other employees only exists where the relationship was between a supervisor and supervisee. And, even in the context of a supervisor-supervisee relationship, courts have held that “a co-worker’s romantic involvement with a supervisor does not by itself create a hostile work environment.” Candelore v. Clark Cnty. Sanitation Dist., 975 F.2d 588, 590 (9th Cir.1992) (emphasis added); Proksel v. Gattis, 41 Cal. App. 4th 1626, 1630 (1996) (“no claim of sexual harassment or discrimination exists” based on a claim of favoritism where the only alleged conduct is a relationship between a supervisor and employee). To establish a favoritism claim, another employee would have to demonstrate that a supervisor’s favoritism of a paramour was so severe and pervasive that it altered his or her working conditions and created a hostile work environment. Miller v. Dep’t of Corrs., 36 Cal. 4th 446, 471 (2005). In Miller, for example, the supervisor promoted women based on sexual favors, not merit, and refused to promote women who would not sleep with him. The court appropriately held that such widespread sexual favoritism could convey a “demeaning message … to female employees that they are viewed by management as ‘sexual playthings’ or that the way required for women to get ahead in the workplace is to engage in sexual conduct with their supervisors or the management.” Id. at 451.

An Obligation to Report Is A Serious Invasion on An Employee’s Privacy

“Actionable invasions of privacy must be sufficiently serious in their nature, scope, and actual or potential impact to constitute an egregious breach of the social norms underlying the privacy right. Hill, 7 Cal. 4th at 37. A policy that requires disclosure of a romantic or sexual relationship by definition infringes on an individual’s privacy rights. In addition, if the employer takes any action as a result of that disclosure (or the employees’ failure to disclose), the decision would be inseparably based totally on a private conduct, or on the failure to disclose such private information. Based on the application of these elements, therefore, there is a prima facie violation of the privacy law. That, however, is not the end of the analysis.

The Employer’s Competing Business Needs Do Not Outweigh the Employee’s Privacy Rights

An employer may assert a defense to a privacy action by claiming that the invasion of a privacy interest “is justified by a competing interest,” which must be balanced against the privacy interest. Hill, 7 Cal. 4th at 37-38. The competing interest must “derive from the legally authorized and socially beneficial activities of government and private entities. Their relative importance is determined by their proximity to the central functions of a particular public or private enterprise. Conduct alleged to be an invasion of privacy is to be evaluated based on the extent to which it furthers legitimate and important competing interests.” Id. at 38.

An employer’s “countervailing interests,” must be then weighed against the availability and use of protective measures, safeguards, and alternatives that would minimize the intrusion on privacy interests.” Hill, 7 Cal. 4th at 38. “[I]f defendant’s legitimate objectives can be readily accomplished by alternative means having little or no impact on privacy interests, the prospect of actionable invasion of privacy is enhanced.” Id.

What is an employer’s competing interest if the employees have no management responsibility over each other, they do not report to each other, they are not of different ranks, and their relationship was maintained outside of work hours? Certainly, as discussed above, there is no potential for favoritism or sexual harassment. To the extent there are any recognizable interests, they are outweighed by the employees’ right to privacy in pursuing a relationship and in keeping the relationship confidential. Furthermore, there are less intrusive alternatives.

For additional information, please call our Los Angeles employment lawyers at (310) 499-0140.