United States District Court, N.D. Illinois
March 31, 2004.
KARENA KOERBER, Plaintiff,
JOURNEY'S END, INC., an Illinois corporation, d/b/a/ The Annex Lounge, Inc., Defendant
The opinion of the court was delivered by: JOHN W. DARRAH, District Judge
OPINION AND ORDER
Plaintiff, Karen A. Koerber, filed suit against Defendant, Journey's
End, Inc., for violations of Title VII of the Civil Rights Act of 1 964,
42 U.S.C § 2000e, et seq. Plaintiff alleges that she was
sexually harassed by an employee of Defendant, thus causing her place of
employment to be a hostile work environment. Trial was by the Court
without a jury on October 28, 29, and 30, 2003, and on November
The Court has considered the evidence, including the testimony of
witnesses and exhibits, and has further considered the written arguments
of counsel for the parties and the authority cited therein.
Pursuant to Federal Rule of Civil Procedure 52, the Court hereby enters
the following Findings of Fact and Conclusions of Law which are based
upon consideration of all the admissible evidence as well as the Court's
determination of the credibility of the trial witnesses. To the extent
that Findings of Fact, as stated, maybe considered Conclusions of Law,
they shall be deemed Conclusions of Law. Similarly, to the extent that
matters expressed as Conclusions of
Law may be considered Findings of Fact, they shall also be deemed
Findings of Fact.
FINDINGS OF FACT
Defendant is the owner and operator of a restaurant and a bar, the
Annex Lounge (the "Annex"), in Mundelein, Illinois, and is an employer,
as defined by 42 U.S.C. § 2000, et seq. Defendant has more
than 14 and fewer than 101 employees. Defendant is owned and operated by
George Orfanos, Greg DiPiero, and Donna DiPiero (collectively, "the
owners"). Plaintiff is a female who was hired by Defendant to work at the
Annex as a waitress in August 1993.
Plaintiff was interviewed and hired by Ernie Young, who was and
remained Plaintiffs direct supervisor throughout her employment for
Defendant. Young was the bar manager at the Annex. He reported to the
owners and had supervision over the bartenders and the waitresses at the
Annex. Plaintiff did not meet any of the owners on the day she was hired,
and Plaintiff did not meet any of the owners until approximately one year
after she was hired.
At the time Plaintiff was hired, Young did not inform her of any policy
against sexual harassment, nor did he explain to Plaintiff what sexual
harassment was. Moreover, neither Plaintiff nor any other employee
received a memo, letter, or any other written correspondence discussing
Defendant's so-called "open-door" policy to report problems, including
sexual harassment problems, when they began working for Defendant. Young
also failed to discuss this open-door policy with Plaintiff, and no
training about sexual harassment was ever provided to Plaintiff or any
other employee. Furthermore, the open-door policy was not posted or
placed in writing for the employees.
When Young hired Plaintiff as a waitress, he needed someone to begin
working immediately. However, Plaintiff had a health condition that
required her to take time off for
medical procedures. Young had the power to schedule shifts; and he
and Plaintiff reached an agreement that Plaintiff would start
immediately, and Young would not penalize her when she was absent for
medical reasons. It would have been difficult, because of pain, for
Plaintiff to work full time at the Annex with her injuries; and Plaintiff
felt that she could not get a job anywhere else with the flexible hours
available at the Annex and required by her medical condition.
In April 1994, Jennifer Denney, another waitress at the Annex, filed a
charge of sexual harassment with the Illinois Department of Human Rights
and the Equal Employment Opportunity Commission (the "EEOC") against
Defendant based on Young's conduct toward Denney. Young admitted to Greg
DiPiero that he had touched Denney's breast behind a closed door to his
office. Defendant settled this claim with Denney for $20,000.
Young was required to pay the settlement amount back to Defendant, even
though he was only making about $30,000 per year working at the Annex, In
addition to paying the $20,000 back to Defendant, Young was required to
sign a "Last-Chance" Agreement. This Agreement provided that the owners
and management of Defendant do not condone the harassment of any patron
or employee and that any such activity would result in Young's immediate
Young signed the Agreement on April 20, 1994. The owners also gave
Young a verbal warning and told Young that his harassing conduct was
unacceptable, and he would not work at the Annex if the conduct
Young's harassment of Plaintiff began as early as August 1993, when he
grabbed Plaintiffs buttocks. Thereafter, despite signing the Denney
Last-Chance Agreement, Young's harassing conduct toward Plaintiff
continued. Young made comments of a sexual nature to
Plaintiff. Young engaged in conduct of a sexual nature towards
Plaintiff, including brushing his hands across Plaintiffs breasts and
patting Plaintiffs buttocks. Young made a comment to Plaintiff about the
size of his penis and pointed to his genital area in Plaintiffs presence.
Young kissed Plaintiff. Young also made comments about Plaintiffs
breasts, how he would like to see them, and he offered Plaintiff money to
see her breasts. Sometimes, these comments were made when customers were
present in the Annex,
Young admitted to some of his harassing conduct. When he met with some
of the owners of the Annex after Denney filed her charge in 1994, Young
admitted that he patted Plaintiffs buttocks, brushed against her breasts,
and kissed Plaintiff. He further admitted that he discussed his penis
with Plaintiff and called her "a bitch." Young also admitted to brushing
up against Plaintiff even though she asked Young to stop.
After Denney filed her claim, Plaintiff met with Denney's attorney to
determine whether Plaintiff could file a charge of harassment. However,
Plaintiff did not file a charge at that time because she could not afford
to lose her job at the Annex.
Because of Young's harassing conduct, Plaintiff quit her job at the
Annex on May 23, 1995. However, Plaintiff went back to work in June 1995
after meeting with the owners to discuss Young's harassing conduct.
After Plaintiff came back to work at the Annex, Young's harassing
conduct continued throughout Plaintiffs employment. Young made sexually
explicit remarks to Plaintiff as well. He told Plaintiff that he
masturbated while thinking of Plaintiff. On Sundays, when the Annex was
slow, Young offered Plaintiff one-hundred dollars in exchange for oral
sex; Plaintiff emphatically rejected these propositions. Young made
comments about the size of Plaintiff s
breasts, and he talked about his penis in front of Plaintiff. One
time, Young asked Plaintiff and another female employee at the Annex,
Irish Sloan, to compare breasts. Young also discussed Plaintiffs buttocks
and his attraction to Plaintiff.
On or around August 21, 1996, Plaintiff was forced to use the men's
restroom at the Annex because of a problem with the women's restroom.
Plaintiff placed Matt Lagoni in front of the men's restroom to guard the
door. However, Plaintiff heard a commotion; and Young walked into the
men's restroom. Young started yelling and simulating an orgasm. Young
further stated that he always wanted to be in the same room as Plaintiff
when her pants were down. Plaintiff was in a toilet stall and yelled at
Young and told him to get out.
Between August 1996 and January 1997, Young, on several occasions,
brushed his hands across Plaintiffs breasts and pretended it was an
accident. He would then comment and say, "Oh, sorry. If your breasts
weren't so big, then it wouldn't be a problem," or something to that
affect. During this time period, Young also came up behind Plaintiff and
pretend to bear hug her. As Young would release his hands, he would touch
her breasts. Plaintiff was offended by Young's acts and told him to
"knock it off' or words to this effect. These incidents occurred when
other people were in the bar.
Young also attempted to touch Plaintiff in other ways between August
1996 and January 1997. Young repeatedly pretended that he needed to speak
with Plaintiff about something, lean in towards her, and then place his
hand on Plaintiffs buttocks. Sometimes he did this act in the view of
customers. Sometimes, Young grabbed Plaintiff and trirf to kiss her when
her arms were locked down. On several occasions, Young squeezed
Plaintiffs face and cheeks and kissed Plaintiff. Young made sexually lewd
comments to Plaintiff during this time period, as well.
When Plaintiff needed a new work T-shirt, Young offered to give her a
free one if she would undress in front of him.
Plaintiff was not receptive to these actions by Young throughout her
employment at the Annex. Sometimes, Plaintiff told Young to knock it
offer called him a pig. Other times, Plaintiff told Young to "go to hell"
or asked him to leave her alone. Sometimes, Plaintiff slapped Young
because of his offensive conduct.
Plaintiff became angry and embarrassed because of Young's conduct.
Young's comments about Plaintiffs breasts caused her low self-esteem, and
she contemplated breast reduction surgery. When Young touched Plaintiffs
breasts, she felt violated, degraded, and humiliated.
On or around January 24, 1997, just two days before Super Bowl Sunday,
Plaintiff quit her job at the Annex. Super Bowl Sunday was one of the
most lucrative days for tips for the waitresses at the Annex. Plaintiff
was originally scheduled to work on Super Bowl Sunday, January 26, 1997;
but Young cancelled her shift that day. On the Thursday before Super Bowl
Sunday, Plaintiff called Young at 5:30 p.m. to cancel her shift that day
because she was sick; Plaintiffs shift started at 6:00 p.m. Plaintiffs
cancellation required Young to call other staff members and see if they
could work for Plaintiff with very little prior notice. Plaintiffs
conduct inconvenienced the Annex staff, and Young cancelled Plaintiffs
Super Bowl shift as a result.
Defendant, in spite of Young's previous actions towards Denney, did not
adopt a formal plan to stop sexual harassment at the Annex. Defendant did
place an Equal Employment Opportunity poster in the bar by the ice
cooler. This poster remained on the wall throughout the entire time
Plaintiff worked at the Annex. However, the poster did not contain any
specific notices about an employee's rights concerning sexual harassment.
Rather, the poster only
contained general information about an employee's rights to be free
from discrimination based on race, color, religion, sex, or national
Although the owners required Young to sign the Last-Chance Agreement,
the owners failed to enforce its terms. One employee, Steve Miller,
visited with one of the owners, Orfanos, in 1996 after he was terminated
by Young for taking a break following a twelve-hour shift. The next day,
Miller spoke with Orfanos and explained the matter to him. Orfanos
rehired Miller; and at that point, Miller told Orfanos of Young's
constant improper behavior. Miller told Orfanos that Young was constantly
harassing any female employees and customers and that people were sick of
this conduct and did not want to put up with it. In reply, Orfanos simply
said, "[t]hat's Ernie." Plaintiff made similar complaints about Young.
Despite these complaints, no internal investigation was ever taken; Young
was never reprimanded; his salary was not reduced; and he was never
suspended, demoted, terminated or disciplined in any manner.
Defendant installed a video recording system at the Annex. The cameras
in the Annex were focused on the bar and the waitress station. Donna
DiPiero could review the tapes from the system. The video tapes, though,
were only reviewed if there was a shortage in the money counted at the
Annex. If there was no shortage, the contents of the tapes, which were
recorded daily, were taped over and those images were destroyed. Young
had access to the video equipment and could turn the video system off as
well. Further, Young knew which areas of the Annex were under video
While working at the Annex, Plaintiff worked two nights a week for a
total of seventeen hours at an hourly rate of $2.50 plus tips. According
to Plaintiff's 1996 W-2 statement, she earned $5,285.00 per year working
for Defendant. According to Plaintiff's 1995 W-2 statement,
she earned $3,736.00 working for Defendant. According to
Plaintiff's 1994 W-2 statement, she earned $3,683.25 working for
After Plaintiff quit her job at the Annex, she sought other employment.
Plaintiff was employed as a waitress for Kemper Lakes Gold Club from
March 1997 until November 1997. From November 1997 until April 1998,
Plaintiff was employed part-time as a receptionist at the Brickman Group.
She took maternity leave from her job at the Brickman Group. From
September 1999 until January 2000, Plaintiff was employed at Toddler's
Time for about $8.00 per hour, and subsequently at Children's World for
an unspecified period for about $8 per hour. Finally, Plaintiff worked
briefly at Zanie's Comedy Club in Vernon Hills, Illinois. On most nights
she worked at Zanie's, Plaintiff earned somewhere between $40.00 and
$60.00 in tips. However, it is unknown exactly how much Plaintiff has
earned since leaving her employment at the Annex. Plaintiff is also not
sure when she was last employed.
Plaintiff filed her charge of employment discrimination with the EEOC
on June 17, 1997. Three-hundred days prior to this filing is August
CONCLUSIONS OF LAW
The following issues are before the Court: (1) whether Plaintiff was
subjected to a hostile work environment and whether Defendant has proved,
by a preponderance of the evidence, an affirmative defense pursuant to
the holding in Ellerth and Faragher, (2) whether
Plaintiff's charge with the EEOC was timely filed; (3) whether Plaintiff
was constructively discharged and, if so, whether that affirmative
defense has been proven; and (4) whether Plaintiff is entitled to damages
and, if so, how much.
Hostile Work Environment
Under Title VII, it is unlawful for an employer "to discriminate
against any individual with respect to his compensation, terms,
conditions, or privileges of employment, because of such individual's
race, color, religion, sex, or national origin." 42 U.S.C. § 2000e-2(a)(1).
To prevail on a hostile work environment claim based on
sexual harassment, a plaintiff must prove that her work environment was
both subjectively and objectively offensive. To be an objectively
offensive work environment, a reasonable person must find the environment
hostile or abusive. To be a subjectively hostile work environment, the
victim must also perceive the environment to be offensive. Cerros v.
Steel Techs., Inc., 288 F.3d 1040, 1045 (7th Cir. 2002)
The plaintiff must also show that the harassment was based on her
membership in a protected class, the conduct was severe or pervasive, and
a basis for employer liability exists. Cerros, 288 F.3d at 1045.
To be severe or pervasive, the wrongful conduct must "alter the
conditions of [the victim's] employment and create an abusive working
environment." Faragher v. City of Boca Raton, 524 U.S. 775, 786
(1998) (Faragher) (second alteration in original).
To determine whether conduct is severe or pervasive, "a court must
consider the totality of the circumstances, including the `frequency of
the discriminatory conduct; its severity; whether it is physically
threatening or humiliating, or a mere offensive utterance; and whether it
unreasonably interferes with an employee's work performance."'
Cerros, 288 F.3d at 1046 (quoting Harris v. Forklift Sys.,
Inc., 510 U.S. 17, 23 (1993)). Thus, the social context of the
offending behavior must be carefully considered in determining whether
conduct is severe or pervasive. Cerros, 288 F.3d at 1046.
Young's conduct towards the Plaintiff specifically found above created
a working environment which was abusive for the Plaintiff, to say the
least. From the beginning of her employment with Defendant, Young's
sexual harassment of Plaintiff was both severe and pervasive. His conduct
was physically threatening and humiliating and included frequent
touching, grabbing, and other deliberate physical contact with
Plaintiff's buttocks and breasts. Young's comments and utterances were
likewise threatening and humiliating to Plaintiff. These statements by
Young included comments about Plaintiff's breasts and buttocks, Young's
penis, requests that the Plaintiff remove her shirt in front of him, and
invitations to engage in oral sex with him. Some of these statements were
made by Young in the presence of Defendant's customers. Young physically
and verbally sexually harassed Defendant throughout her employment with
Young's verbal and physical conduct was excessive and repetitive.
Moreover, his repeated actions were severe and carried out over
Plaintiff's objections. The totality of the circumstances indicates that
Young's conduct altered the conditions of Plaintiff's working environment
and created a hostile working environment. Plaintiff remained employed at
the Annex only because it provided the flexible work hours which she
required. A reasonable person subjected to this sort of repetitive
conduct would find it humiliating. Suffering this type of harassment from
a supervisor would unreasonably interfere with an objective person's work
performance. Accordingly, Plaintiff has proven, by a preponderance of the
evidence, that Young's conduct was objectively offensive.
Plaintiff specifically voiced her desire that Young's conduct stop on
numerous occasions, as well. Sometimes, she would push Young. When Young
asked Plaintiff for oral sex, Plaintiff,
in a very direct manner, told Young no. On other occasions,
Plaintiff slapped Young for his inappropriate conduct.
Specifically, Plaintiff was upset after the bathroom incident with Young.
Based on these circumstances, Plaintiff has proven, by a preponderance
of the evidence, that her work environment was subjectively hostile and
that she objected to Young's conduct and felt humiliated by his actions.
Plaintiff has also proven, by a preponderance of the evidence, that:
(1) as a female, she is a member of a protected class; and (2) she was
harassed and subjected to a hostile work environment because of her
Defendant has asserted an affirmative defense pursuant to the holdings
in Burlington Industries v. Ellerth, 524 U.S. 742 (1988)
(Ellerth) and Faragher, 524 U.S. 775. A defendant in a
sexual harassment suit who did not take a tangible employment action
against the plaintiff may avoid liability if it can show that: (1) it
exercised reasonable care to prevent and correct promptly any sexually
harassing behavior; and (2) the plaintiff unreasonably failed to take
advantage of any preventative or corrective opportunities. See, e.g.,
Sappington, 351 F.3d at 331. The defendant is required to prove, by
a preponderance of the evidence, that both elements of the defense have
been satisfied. Haugerud v. Amery Sch. Dist.,
259 F.3d 678, 698 (7th Cir. 2001) (Haugerud).
Both the Supreme Court and the EEOC have recognized that small
businesses may establish informal policies to deal with hostile work
environment claims. See Faragher, 524 U.S. at 808 ("Unlike the
employer of a small workforce, who might expect that sufficient care to
prevent tortious behavior could be exercised informally. . . ."); EEOC
Notice 915.002 ("It may not be necessary for an employer of a small
workforce to implement the type of formal complaint
process described above. If it puts into place an effective,
informal mechanism to prevent and correct harassment, a small employer
could satisfy the first prong of the affirmative defense to a claim of
harassment."). However, the process must be effective; the employer must
pursue an internal investigation or take some other appropriate remedial
action. See Haugerud, 259 F.3d at 699.
Here, it is undisputed that Defendant had no formal, written policy
against sexual harassment at the Annex. Defendant, though, argues it had
other mechanisms in place to report and prevent problems. Specifically,
Defendant argues that an EEO poster detailing employees' rights was
placed above a cooler; a video recording system was put into place to
monitor the Annex; the owners had an informal, open-door policy to
report problems; and a "Last-Chance Agreement" with Young was
However, the EEO poster did not contain any specific notices about an
employee's rights concerning sexual harassment. Rather, the poster only
contained, in general terms, information about an employee's rights to be
free from discrimination based on race, color, religion, sex, or national
origin. A general poster generally disclosing an employee's workplace
rights does not prove that an employer had a policy in place that would
prevent and correct promptly any sexually harassing behavior and is not
sufficient evidence that Defendant exercised reasonable care to prevent
and correct promptly any sexually harassing behavior by implementing an
informal policy against sexual harassment at the Annex.
Defendant's video recording system also fails to demonstrate that
Defendant exercised reasonable care to prevent and correct promptly any
sexually harassing behavior by implementing an informal policy against
sexual harassment at the Annex. The video tape system
was to prevent theft at the Annex; Young could turn the video
system off, and Young knew which areas were under video surveillance.
Under these circumstances, it cannot be said that the video system would
prevent and correct promptly any sexually harassing behavior by
Defendant's so-called open-door policy to discuss problems also fails
to demonstrate that Defendant exercised reasonable care to prevent and
correct promptly any sexually harassing behavior by implementing an
informal policy against sexual harassment at the Annex. This policy was
not in writing and posted for its employees to see. Nor did employees
receive a memo, letter, or any other writing disclosing this so-called
open-door policy upon commencing employment. Young, Plaintiff's direct
supervisor and the person who hired Plaintiff, did not inform Plaintiff
of any open-door policy when she was hired. Nor did any of the owners
ever discuss an open-door anti-harassment policy with Plaintiff; rather,
Plaintiff did not even meet any of the owners until approximately one
year into her job.
Finally, the Last-Chance Agreement implemented with Young fails to
demonstrate that Defendant exercised reasonable care to prevent and
correct promptly any sexually harassing behavior by implementing an
effective policy against sexual harassment at the Annex. The Last-Chance
Agreement states that the Defendant does not condone the harassment of
any patron or employee and that any such activity will result in
immediate termination. However, as set out above, when one employee,
Miller, told Orfanos, one of the owners, in 1996 of Young's behavior
towards female employees and customers, the owner simply said "[t]hat's
Ernie." Plaintiff made similar complaints about Young. In each instance,
no evidence was presented that the Defendant pursued an internal
investigation or took any remedial actions.
Based on the totality of the circumstances, the Defendant has failed to
prove, by a preponderance of the evidence, that it exercised reasonable
care to prevent and correct promptly any sexually harassing behavior.
Accordingly, Defendant has failed to prove that both elements of the
Ellerth/Faragher affirmative defense have been satisfied; and a
basis for employer liability thus exists.
The EEOC Filing Requirement
Before filing a Title VII discrimination suit in federal court, a
plaintiff must bring a charge of discrimination with the EEOC within 300
days of the alleged acts giving rise to his or her claims. See, e.g.,
Koelsch v. Beltone Elecs. Corp., 46 F.3d 705, 707 (7th Cir. 1995).
Acts of discrimination which occurred outside the 300-day period are
time-barred both before the EEOC and in federal court.
Here, Plaintiff may recover for acts of harassment that occurred on or
after August 21, 1996, which is 300 days prior to her filing of the EEOC
charge on June 17, 1997. On or around August 21, 1996, Young entered the
men's bathroom and sexually harassed Plaintiff, as discussed above.
Throughout the remainder of 1996 and the early part of 1997, Young made
references to customers about Plaintiff's breasts in front of Plaintiff,
touched Plaintiff's buttocks, and, on several occasions during this time
period, squeezed Plaintiff's cheeks and kissed Plaintiff. Accordingly,
Plaintiff has proven, by a preponderance of the evidence, that an act
contributing to her hostile work environment claim occurred during the
300-day filing period.
However, if Plaintiff can establish that the post-August 21, 1996 acts
were a part of a continuing violation, she may recover for all acts of
sexual harassment that she endured during her employment at the Annex.
Plaintiff must demonstrate that "there has been a pattern or policy
of discrimination continuing from outside the limitations period
into the statutory limitations period, so that all discriminatory acts
committed as part of this pattern or policy can be considered . . .
timely." Hardin v. S.C. Johnson & Son, Inc., 167 F.3d 340,
344 (7th Cir. 1999) (alteration in original).
In contrast to a discrete discriminatory event, hostile work
environment claims are series of separate acts that together constitute
one "unlawful employment practice" under 42 U.S.C. § 2000e-5(e)(I).
Nat'l R.R. Passenger Corp. v. Morgan, 536 U.S. 101, 117 (2002)
(Morgan). For a hostile work environment claim, it is irrelevant
that some of the hostile acts occur outside the statutory time period.
"Provided that an act contributing to the claim occurs within the filing
period, the entire time period of the hostile environment may be
considered by a court for the purposes of determining liability."
Morgan, 536 U.S. at 117.
Plaintiff has proved, by a preponderance of the evidence, that
discriminatory acts occurred within the 300-day filing period
between August 21, 1996 and June 17, 1997. Plaintiff was first
harassed at the Annex in August, 1993; and the harassment continued past
August 21, 1996, and throughout Plaintiff's employment at the Annex. Thus,
under the continuing violation doctrine, Plaintiff may recover for all
acts of sexual harassment she suffered while she was employed by
Defendant. Therefore, Plaintiff may recover for all acts of harassment
she suffered while working at the Annex between August 1993 and January
Defendant contends that even though conduct more than 300 days before
the EEOC filing requirement may be considered, an employer may also
assert equitable defenses, such as waiver and estoppel, when a plaintiff
unreasonably delays filing a charge. Morgan, 536 U.S. at 121.
Thus, an employer may raise the equitable defense of laches if the
plaintiff: (1) lacked diligence
in asserting her claim and (2) prejudiced the defendant through
this lack of diligence. Morgan, 536 U.S. at 121-22.
Generally, the longer the plaintiff delays in filing a claim, the less
prejudice the defendant is required to show in order to defend based on
laches. However, even for an extended delay, a defendant is still
required to make a minimal showing of material prejudice, "meaning it
affects the substantial rights of the defendant to such a degree that it
justifies the equitable relief of barring the plaintiff's claims."
Smith v. Caterpillar, Inc., 338 F.3d 730, 734 (7th Cir. 2003)
Defendant contends that Plaintiff knew she was a possible victim of
sexual harassment as early as spring of 1994, when she consulted with
Denney's attorney and perceived herself to be a victim of Young's abuse.
Thus, Defendant claims it was economically harmed because it was deprived
of the opportunity to handle the matter internally instead of paying
backpay for a delayed lawsuit.
Defendant, though, had an opportunity to address Plaintiff's complaints
against Young but failed to take appropriate measures. Plaintiff resigned
from the Annex in May 1995 as a result of Young's conduct. However,
Young's harassing conduct of Plaintiff resumed after she returned to work
and had met with the owners and continued throughout the remainder of
Plaintiff's employment at the Annex without any intervention by them.
Defendant has failed to demonstrate any prejudice it suffered by
Plaintiff's failure to assert her claim earlier. Significantly, Defendant
produced no evidence that: (1) as a result of the delay, it could not
present testimony from pertinent witnesses because they were unavailable
or their memories had faded; or (2) key documents relating to Plaintiff's
employment were lost or
destroyed because of Plaintiff's delay. See Smith, 338
F.3d at 733. Therefore, based on all the relevant facts, Plaintiff's
delay in filing her EEOC charge did not materially prejudice Defendant to
such a degree that justifies the equitable relief of barring Plaintiff's
Plaintiff next argues that, because of the hostile working environment
at the Annex, she suffered a constructive discharge. Defendant argues
that the working environment at the Annex was not so hostile that
Plaintiff was effectively forced to quit her employment.
"A constructive discharge occurs when an employee resigns his or her
current position because the employee considers the conditions
intolerable and a reasonable employee also would have found the
conditions remaining in the job unbearable." Robinson v.
Sappington, 351 F.3d 317, 336 (7th Cir. 2003) (Sappington).
The working conditions for a constructive discharge must be even more
egregious than the conditions for a hostile work environment because,
typically, "an employee is expected to remain employed while seeking
redress." Sappington, 351 F.3d at 336.
Plaintiff and a reasonable person would have felt that the conditions
for remaining at the Annex unbearable. As set out above, over the course
of her three-year employment with Defendant, Plaintiff was repeatedly
subjected to offensive comments and humiliating unwanted physical contact
of a sexual nature, sometimes in front of customers, from her supervisor,
Young. The harassing conduct occurred at the Annex despite the owner's
awareness that Young had both previously and was currently harassing
Plaintiff. Plaintiff's working conditions became so unbearable that she
was forced to quit her employment. Remaining at the Annex would have
subjected Plaintiff to further harassment and a cruel working situation.
See Sappington, 351 F.3d
at 337. Therefore, Plaintiff has proven, by a preponderance of the
evidence, that she was forced to quit her job at the Annex and was thus
Defendant contends that this constructive discharge was not a "tangible
employment action," for the purposes of the Ellerth/Faragher
affirmative defense. Typically, tangible employment actions are
discharges, demotions, or undesirable reassignments. Ellerth,
524 U.S. at 765. A tangible employment action, which inflicts economic
harm on the employee, can only be made by a supervisor, who "has been
empowered by the company as a distinct class of agent to make economic
decisions affecting other employees under his or her control."
Ellerth, 524 U.S. at 762. In these situations, "there is
assurance the injury could not have been inflicted absent the agency
relation" between the supervisor and the employer. Ellerth, 524
U.S. at 761-62.
However, because either a supervisor or a co-worker can be the cause of
a constructive discharge, "there is a concern that equating [a]
constructive discharge with other types of tangible employment actions
will impose liability on employers when the offending employee has not
been empowered by the employer to take the actions at issue."
Sappington, 351 F.3d at 335. Thus, for a constructive discharge
to be a tangible employment action for purposes of the
Ellerth/Faragher affirmative defense, the Seventh Circuit has
added an additional requirement: official action by the supervisor must
make the employment intolerable. Sappington, 351 F.3d at 336.
The supervisor must not only harass the employee; but, also, the
supervisor must so act in an "official, supervisory capacity" in making
the employment environment intolerable, Sappington, 351 F.3d at
Here, Plaintiff has failed to prove, by a preponderance of the
evidence, that her constructive discharge was a tangible employment
action. The only employment action taken by Young which could be
considered an official act of a supervisor was his decision to cancel
Plaintiff's shift at the Annex on Super Bowl Sunday, 1997, a lucrative
day for a waitress such as Plaintiff. Young made this decision to
discipline Plaintiff because she had previously called to say she would
not be at work a half-hour before Plaintiff's shift was scheduled to
begin, which severely inconvenienced the Annex staff. Plaintiff does not
contend and has produced no evidence that Young's action in this regard
was in any way related to his sexual harassment of Plaintiff.
Therefore, Defendant has properly asserted the
Ellerth/Faragher defense; and it must be determined whether
Defendant has proven both elements of this defense to the constructive
discharge. However, as fully discussed above, Defendant has not proven,
by a preponderance of the evidence, that it exercised reasonable care to
prevent and correct promptly any sexually harassing behavior. Therefore,
Defendant is liable for the constructive discharge of Plaintiff.
Plaintiff seeks punitive damages, compensatory damages, and backpay for
the harassing conduct and constructive discharge she suffered at the
Annex. Under 42 U.S.C. § 1981a(a)(1), a plaintiff may recover
compensatory damages and punitive damages, in addition to backpay. The
total amount of compensatory damages and punitive damages that may be
assessed against an employer with more than 14 but fewer than 101
employees, such as Defendant, is $50,000. 42 U.S.C. § 1981a(b)(3).
However, backpay is not included in the calculation of compensatory
damages. 42 U.S.C. § 1981a(b)(2).
To recover punitive damages, a plaintiff must demonstrate that the
employer "engaged in a discriminatory practice or discriminatory
practices with malice or with reckless indifference to the federally
protected rights of an aggrieved individual." 42 U.S.C. § 1981a(b)(1).
A three-part test is used to determine whether the assertion
of punitive damages is proper. First, a plaintiff must demonstrate the
employer acted with the requisite mental state. To satisfy this element,
a plaintiff may show that "relevant individuals knew of or were familiar
with the antidiscrimination [sic] laws and the employer's policies for
implementing those laws." Hertzberg v. SRAM Corp., 261 F.3d 651,
661-62 (7th Cir. 2001) (Hertzberg) (quoting Bruso v. United
Airlines, 239 F.3d 848, 857-58 (7th Cir. 2001) (Bruso)).
Plaintiff has proven, beyond a preponderance of the evidence, that
Young was familiar with the anti-discrimination laws and his employer's
policy for implementing those laws. Young was required to sign the
Last-Chance Agreement, which stated that Defendant did not tolerate
sexual harassment under any circumstances. Young was also given a verbal
warning by the owners that he would be terminated if his harassing
behavior continued. Under these circumstances, Young had enough
familiarity with the anti-discrimination laws to understand that sexual
harassment was illegal.
After a plaintiff meets this burden, she must show that the
discriminating employees are managerial agents who acted within the scope
of their employment. Hertzberg, 261 F.3d at 662. This inquiry is
fact-intensive and looks at "the kind of authority the employer has given
the employee, the amount of discretion given to the employee in executing
his job duties, and the manner in which those duties are carried out."
Hertzberg, 261 F.3d at 663 (quoting Bruso, 239 F.3d at
Here, Young, the bar manager at the Annex, interviewed, hired, and
supervised Plaintiff. He had the power to arrange unique scheduling
arrangements with employees, such as the agreement he made with Plaintiff
when she started working at the Annex. Young could also remove staff
members from shifts, including lucrative shifts during Super Bowl Sunday.
Young thus had significant authority at the Annex and a considerable
amount of discretion in hiring and scheduling. Therefore, Plaintiff has
proven, by a preponderance of the evidence, that Young was a managerial
employee acting within the scope of his employment when he sexually
If a plaintiff meets these burdens, the employer can still avoid
liability for punitive damages. The employer must show that "it engaged
in good faith efforts to implement an antidiscrimination [sic] policy."
Hertzberg, 261 F.3d at 662 (quoting Bruso, 239 F.3d at
In this case, Defendant has not proven, by a preponderance of the
evidence, that it did engage in a good faith effort to implement an
anti-discrimination policy. As discussed above, Defendant's display of
one EEO poster, their video surveillance system limited to theft
detection, the so-called, but non-existent, open-door policy, and the
payment for Young's prior sexual harassment do not evidence a policy by
Defendant to prevent discrimination at the Annex as occurred in this
Plaintiff suffered through repeated instances of sexual harassment over
the course of approximately three years from her immediate supervisor.
The owners, who were aware of both Young's prior conduct towards Denney
and his conduct at the Annex generally, did nothing to protect female
employees from harassment. But, significantly, Young was required to
reimburse the Defendant $20,000 for the settlement with Denney. Defendant
was ultimately not "out of
pocket" for Young's prior sexual harassment of Denney. Essentially,
the owners simply relied on trusting Young not to harass any more female
employees at the Annex and provided effectively nothing more to protect
its employees. Because Plaintiff is entitled to the maximum allowable
statutory damages, it is unnecessary to consider whether Plaintiff is
entitled to compensatory damages. Based on the above, Plaintiff is
entitled to $50,000 in punitive damages against Defendant, the maximum
amount mat can be awarded under § 1981a(b)(3).
Plaintiff also seeks backpay from Defendant. A district court has broad
equitable discretion in fashioning backpay awards that make a Title VII
plaintiff whole. David v. Caterpillar, Inc., 324 F.3d 851, 865
(7th Cir. 2003) (David). Once a violation of Title VII has been
found, there is a strong presumption that the plaintiff is entitled to
backpay for what she would have earned but for the discrimination.
David, 324 F.3d at 865. However, "amounts earnable with
reasonable diligence by the person or persons discriminated against shall
operate to reduce the backpay otherwise allowable." 42 U.S.C. § 2000e-5(g)(1).
Plaintiff is required to establish the amount of damages
she seeks. See E.E.O.C. v. Gurnee Inn Corp., 914 F.2d 815, 818
(7th Cir. 1990) (Gurnee).
Plaintiff seeks backpay, at a rate of $5,285.00 per year, based on her
1996 W-2 statement, starting from February 1997. Plaintiff then seeks
backpay for one of two periods: (1) through the end of 2003, which would
compensate Plaintiff through the completion of the trial; or (2) through
the end of June 2001. However, based on Plaintiff's W-2 statements
throughout her approximately three years at the Annex, Plaintiff earned
an average of $4,234.75 per year.
Plaintiff worked continuously in replacement jobs from March 1997 until
April 1998. Plaintiff has failed to show how much she earned during that
time period to permit determination
of the amount of her loss of pay, if any, after leaving the Annex.
Therefore, Plaintiff has failed to establish she is entitled to backpay
from March 1997 to April 1998.
Plaintiff terminated her employment after April 1998 while she was
pregnant. Plaintiff resumed employment in September 1999. This loss of
pay from unemployment is not related to her unlawful discharge from the
Annex. Therefore, Plaintiff may not recover backpay for this time period
as well. From September 1999 until January 2000, Plaintiff made $8.00 per
hour working at Toddler's Time. Plaintiff did not specify how many hours
a week she worked or her total cumulative pay for this time period.
Again, it is impossible to determine if she earned more or less than what
she would have earned at the Annex. Plaintiff has failed to establish she
is entitled to backpay from September 1999 until January 2000. Plaintiff
then worked for an unspecified period, for $8.00 per hour, at Children's
World. Finally, Plaintiff made approximately $40.00 to $60.00 per night,
for an unspecified period, working at Zanie's Comedy Club. It is unknown
when Plaintiff last worked. Accordingly, these amounts fail to properly
establish the amount of backpay to which she may be entitled. Therefore,
no backpay is awarded to Plaintiff.
For the foregoing reasons, judgment is entered in favor of Plaintiff
and against Defendant in the amount of $50,000.00
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