Last month the Seventh Circuit Court of Appeals reinstated a $3.5 million punitive damages award against an employer for failure to “stiffen its efforts” to respond to an employee’s harassment complaints.  See May v. Chrysler Group, LLC, Nos. 11-2012 and 11-3109, U.S. App. LEXIS 17820, at *30 (7th Cir. Aug. 23, 2012).  May, who is Cuban Jewish, worked as a pipefitter at a Chrysler assembly plant and was subjected to racist, xenophobic, homophobic, and anti-Semitic graffiti over the course of a three-year period. The harassment involved over 70 incidents of hateful graffiti, death-threat notes left in May’s toolbox, and threatening phone calls. The harassers vandalized May’s car, struck him in the back with a flying object, punctured his bike and car tires several times, poured sugar in his car tank twice, and left at his work station a dead bird wrapped in toilet paper to look like a Ku Klux Klansman. At Chrysler’s request, May identified 19 employees he had reason to suspect, including two employees who had a history of making racist comments, as well as the husband of the human resources supervisor assigned to May’s case.  Chrysler did not interview any of the suspects. The only issue at trial and on appeal was whether Chrysler was liable for the hostile work environment to which May had been subjected—that is, whether Chrysler failed to respond “promptly and adequately” in a manner likely to end the harassment.

Chrysler’s response to the harassment included a meeting with the head of HR reminding employees at the plant about Chrysler’s harassment policy, implementation of a protocol for handling incidents of harassment against May, an investigation of who was at the plant at the time of the incidents, and retaining a forensic document examiner. The jury found that Chrysler “did not take steps reasonably intended to stop the harassment” and awarded compensatory damages against Chrysler in the amount of $709,000, as well as punitive damages in the amount of $3.5 million. On a post-trial motion for judgment as a matter of law, the District Court agreed that there was sufficient evidentiary basis for the jury to find the employer liable, particularly in light of the “long period of time” during which May endured the harassment, the fact that Chrysler’s response did not adapt or escalate as the harassment continued, Chrysler’s reliance on the same reactionary response despite its obvious ineffectiveness as a deterrent, and Chrysler’s failure to investigate every incident of harassment. May v. Chrysler Group LLC, No. 02 C 50440, 2011 U.S. Dist. LEXIS 73378, at *11-15 (N.D. Ill. July 7, 2011). The district court nonetheless remitted the compensatory damages award from $709,000 to $300,000 on the ground that there was no rational connection between the award and the evidence since the plaintiff had not presented any evidence of actual damages, such as medical bills, and emotional distress alone did not justify such a high award.  Furthermore, the district court vacated the punitive damages award, finding that while Chrysler’s response was potentially “imperfect and somewhat lacking,” it did not reach the level of “callousness and intentional disregard of plaintiff’s right” to support a punitive damages award. READ MORE →