On March 24, 2017, the 7th Circuit reversed the dismissal of a complaint which alleges that employers jointly employed, as a supervisor, an employee with a known history of sexually harassing, verbally abusing, and physically intimidating his young female subordinates; and that they failed to take reasonable steps in response to multiple complaints of sexual harassment against him as well as other misconduct known to more senior managers. Anicich v. Home Depot U.S.A., Inc., et al., No. 16-1693 (7th Cir. 3/24/2017). In this decision, the 7th Circuit clarifies and explains the scope of Illinois employers’ tort liability for intentional torts committed by their supervisors against other employees, where the employer has been negligent. Illinois law permits recovery from employers whose negligent hiring, supervision, or retention of their employees causes injury.

The complaint alleges, inter alia, the following: that the supervisor verbally abused a female subordinate while he threw things, controlled and monitored her during and outside of her work hours, and required her to come with him on business trips; that after five years of this treatment, he misused his supervisory authority, with which the defendants had entrusted him, to require the subordinate to accompany him to his sister’s wedding in Wisconsin, by threatening to fire her or cut her hours if she refused; that she went; and that after the wedding, he killed and raped her while she was pregnant. The complaint also alleges that the supervisor’s behavior toward female subordinates was know to the employers; and that throughout her employment, the subordinate had repeatedly complained about her supervisor to higher level supervisors and managers.

The defendants moved to dismiss the complaint on the ground that they do not owe a duty of care to the subordinate under Illinois law. The district court agreed and dismissed the complaint. In reversing the dismissal, the 7th Circuit applied Illinois tort law, under which one person has no duty to prevent the criminal acts of another. However, Illinois employers have a duty to act reasonably in hiring, supervising, and retaining their employees. Illinois law recognizes a claim against an employer for negligently hiring, supervising, or retaining an employee the employer knew, or should have known, was unfit for the job in a way that created a danger to others. The elements of this claim are that: (1) the employer knew or should have known that an employee had a particular unfitness for his position which created a danger of harm to third persons; (2) that the unfitness was known or should have been known at the time of the hiring, retention, or failure to supervise; and (3) that the unfitness proximately caused the injury. The proximate cause requirement is met when the employee’s unfitness made harm to the plaintiff reasonably foreseeable. It is not necessary that the employer must have foreseen the precise injury or type of occurrence.

In rejecting the defendants’ position–that employer negligence liability would foist a burden on employers to fire or demote employees for sexual misconduct, the 7th Circuit pointed out that employers already have that obligation, independent of Illinois tort law, under Title VII of the Civil Rights Act of 1964, as well as the Illinois Human Rights Act. These statutes provide that sexually hostile or abusive work environments are an actionable form of sex discrimination (a/k/a sexual harassment) and that employers are liable for failing to discipline supervisors or employees who sexually harass other employees. Under federal law, employers are vicariously liable for sexually hostile work environments created by their supervisors, unless they exercise reasonable care to prevent and promptly correct the sexual harassment.

Illinois law limits employer liability for the negligent hiring, supervision, or retention of an employee acting outside the scope of his employment to situations where the employee harmed the victim on the employer’s premises or by using the employer’s chattel (such as a motor vehicle). Defendants argued that the supervisor was not on their premises or using their chattels when he allegedly killed the subordinate. But he used something else the defendants gave him–supervisory authority– which he manipulated as a means to accomplish his purpose. He could only do so because the defendants made him her supervisor. Employer liability based on the misuse of supervisory authority, therefore, is consistent with Illinois law because supervisory authority, in the employment tort context, is analogous to an employer’s chattel. In addition, other grounds exist to hold employers liable for misuse of supervisory power. Injuries caused by using an employer’s chattel or abusing supervisory authority both occur by virtue of the supervisor’s employment. Moreover, the law has moved toward holding employers vicariously liable for their supervisors’ intentional torts, even if committed outside the scope of their employment, when they caused the harm by abusing or threatening to abuse their supervisory authority.

The 7th Circuit concluded that intentional torts committed by the abuse of a supervisor’s authority are actionable under Illinois law and, therefore, the complaint states a claim for negligent hiring, supervision, or retention.