On September 10, 2018, the 7th Circuit affirmed a jury verdict in favor of a former employee of a big box company, who alleged and testified that she was harassed by a store customer. Equal Employment Opportunity Commission v. Costco Wholesale Corporation, Nos. 17-2432 & 17-2454 (7th Cir. 9/10/2018). The employee testified at trial that she was stalked by a store customer for over a year. Things got so bad at the end that she secured a no-contact order from an Illinois state court. She took unpaid medical leave due to emotional trauma from the experience, and when she did not return to work from medical leave, the company terminated her employment. The Equal Employment Opportunity Commission (“EEOC”) filed a lawsuit against the company on behalf of the employee, alleging that the company had subjected her to a hostile work environment by tolerating the customer’s harassment. The 7th Circuit held that a reasonable jury could conclude that the customer’s conduct was severe or pervasive enough to render the employee’s work environment hostile.

There was evidence at trial that the customer repeatedly approached the employee and asked her personal questions, which she reported to her direct manager. The employee encountered the customer multiple times for over a year. The employee testified that the customer constantly tried to talk to her and constantly tried to give her his phone number. The 7th Circuit concluded that based on the trial record evidence, the jury could infer both that the customer approached the employee very frequently and that he sometimes came to the store to see her rather than to shop. She testified that he watched her, which made her uncomfortable, talked to her, and expressed some of his questions in a sexual way. She testified that he told her that she was pretty, beautiful, and exotic, asked her age, asked her out on dates, and commented on her physical appearance. There was also some evidence of physical contact–the customer using his shopping cart to bump into the employee or her cart, touching her twice (once on her face, once on her wrist), and attempting to hug her twice. She testified that she observed him with his phone over his head, videotaping her, after which she secured a non-contact order from the circuit court. The company investigated, ultimately instructed the customer to not shop at that particular store, and directed him to shop at one of its other stores in a different location. Subsequently, while the employee was shopping with her father at the store where the customer was told to shop, the customer screamed profanity at them. Thereafter, the company forbade the customer to enter any of its stores without direct permission from the store General Manager or the Assistant Vice President of the Midwest Region.

The EEOC alleged that the company had discriminated against the employee because of her sex by creating and tolerating a sexually hostile work environment of offensive comments of a sexual nature, unwelcome touching, unwelcome advances, and stalking by a customer. After the hostile work environment claim went to trial, the jury awarded the employee $250,000 in compensatory damages. Title VII of the Civil Rights Act of 1964 (“Title VII”) prohibits an employer from discriminating against an employee on the basis of sex. An employer violates this provision when discrimination based on sex creates a hostile or abusive work environment. The 7th Circuit stated that this case is unusual because it involves alleged sexual harassment by a customer rather than by a supervisor or coworker. However, an employer can still be liable for a hostile work environment that results from the acts of non-employees, including customers. The same standard of liability applies to both co-worker and customer harassment. To establish a hostile work environment claim, a plaintiff must demonstrate that she was: (1) subjected to unwelcome sexual conduct, advances, or requests; (2) because of her sex; (3) that were severe or pervasive enough to create a hostile work environment; and (4) that there is a basis for employer liability. The third factor requires the unwelcome conduct to be severe or pervasive enough from both a subjective and an objective point of view. At issue on appeal was the objective prong. To be severe or pervasive enough to create a hostile work environment, conduct must be extreme. The determination depends on all of the circumstances, including the frequency of the discriminatory conduct; its severity; whether it is physically threatening or humiliating; and whether it unreasonably interferes with an employee’s work performance. The harassment must occur because of the plaintiff’s sex, but the harassment does not have to be overtly sexual to be actionable under Title VII. The harassment need not consist of pressure for sex, intimate touching, or a barrage of deeply offensive sexual comments. Actionable sex discrimination can take other forms, such as demeaning, ostracizing, or even terrorizing an employee because of her sex. It was reasonable for the jury to find that the customer’s alleged conduct was objectively intimidating or frightening. A reasonable juror could conclude that being hounded for over a year by a customer, despite intervention by management, involvement of the police, and knowledge that he was scaring her would be pervasively intimidating or frightening to an average person (i.e., from an objective point of view). Thus, the company’s challenge to the jury’s conclusion that the customer severely or pervasively harassed the employee was a losing argument.