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Bailey v. USF Holland, Inc., No. 07-5304 (6th Cir. May 16, 2008)

| May 15, 2008 | Daily Developments in EEO Law |

Unrepentant harassers leave their employer stuck with a $700,000 judgment in Nashville, plus the legal bill for one of the least effectual defenses in recent memory.  Bailey v. USF Holland, Inc., No. 07-5304 (6th Cir. May 16, 2008).

On February 20, 2008, I wrote about a serial sex harasser who remained employed for ten years — while the female victims were simply moved away — until the company finally fired him.  (Hawkins et al. v. Anheuser-Busch, Inc., No. 07-3235 (6th Cir. Feb. 19, 2008)).  The record in this case was not dissimilar; if anything, the company’s reaction was even more pathetic.   The plaintiffs were two African-American dock workers for a trucking company, who over the greater part of a decade were taunted with racial epithets (principally, the use of the word “boy”), graffiti and in at least one instance a noose.

The co-workers not only failed to heed anti-harassment warnings, but told the managers directly that they planned to go right on hazing the plaintiffs: 

“When Julie Jones became the terminal manager in 2004, Bailey, Smith, and another employee complained to her about the racially charged environment. She informed Steve Blubaugh, the Vice President of Human Resources. Blubaugh then conducted ‘sensitivity training’ at the terminal and specifically addressed the use of the term ‘boy,’ noting that it was a racial epithet used during sla very. During the sensitivity training, ‘several white employees voiced resistance to the idea that it was wrong to refer to African-American men as ‘hey boy’ or ‘damn it boy.” One white employee, Fred Connor, told Jones that the word ‘boy’ was a ‘southern thing’ and that he would continue to use it regardless of company policy, informing her that because of his insistence on using the word, ‘you are probably going to have to fire me one day.'”

The company hired an outside law firm to investigate the situation, which made more of a muddle:

“In November 2004, attorney Allen Cave, a member of a law firm employed by defendant, spent three days at the Nashville terminal investigating Mr. Bailey’s, Mr. Smith’s, and Mr. Bolden’s complaints. In his report, Cave stated, in part, that, ‘while the environment likely is not racially hostile, it is certainly one in which more sensitive employees can feel uncomfortable.’ Cave concluded that ‘raw racial attitudes, combined with the rough manner in which the employees engage each other could, if left unchecked, create a more legally objectionable situation in the future.’

“After receiving Cave’s report, Blubaugh wrote each of the plaintiffs and stated that, ‘regarding the issues of nooses and racial slurs not including the word ‘boy,’ the company could not discipline any specific employees because those employees had denied the conduct charged.’ Blubaugh stated that the company would continue to hold ’employee meetings’ and any employee who engaged in improper conduct would be disciplined. Regarding the use of the word ‘boy,’ the company concluded ‘that no one has used this term with racial animus, nor with any intent to hurt [the plaintiffs’] feelings.'”

At a bench trial, the district court found the employer liable and awarded each plaintiff $350,000 in compensatory damages, although it somehow avoided punitive damages.  The employer must have banked on the hope that the Sixth Circuit would hold the judge’s liability findings clearly erroneous.  But how likely was that outcome on the record presented at trial:

“A harassment policy itself means nothing without enforcement, and the persistent harassment plaintiffs received over an extended period of time caused the district court to conclude that the policy was not consistently enforced. Defendant conducted employee meetings, but plaintiffs’ coworkers stated that they did not consider their use of ‘boy’ to be offensive and insisted that they would continue to use it. Defendant discharged Connor once it discovered that he created the graffiti, but he was reinstated soon thereafter. USF Holland was unable to stop the graffiti until it installed security cameras – an act it did not take until after plaintiffs initiated this lawsuit.”

Where were the defense lawyers telling USF to settle this case, or at least not to take a hopeless appeal?

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