Employer Liability for Clients’ Harassment Approaches High Court

The battle over when employers are liable for the sexual harassment of one of their workers by a client, student, or other third party shifted to the US Supreme Court and the Third Circuit in separate new filings.

At issue is whether workers subjected to lewd comments, come-ons, or similar abuse by someone other than a supervisor or coworker must prove their employer intended for the harassment to occur or just that their employer negligently let it happen. Third-party harassers can also include vendors, patients, and temporary employees.

“It’s the work relationship with the company that puts the employee in the position where they’re harassed,” James Hux of Hux Law Firm LLC said.

The debate was spurred by an August US Court of Appeals for the Sixth Circuit ruling that broke ranks with up to 10 other circuits in setting an intent test, a view a Philadelphia federal judge in November predicted the Third Circuit would follow.

The Supreme Court’s now been asked to weigh in on the Sixth Circuit case, while the Third Circuit is asked to reverse the US District Court for the Eastern District of Pennsylvania ruling.

The standard used can sway the outcome of a lawsuit, especially before it reaches a jury. Critics of Bivens v. Zep Inc. and O’Neill v. Trustees of the University of Pennsylvania say they erode worker rights by making plaintiffs prove their employer desired for harassment to occur or was substantially certain it would, a higher bar than the negligence test’s knew-or-should-have-known standard.

In the former, ex-Zep territory sales representative Dorothy Bivens says a customer repeatedly asked her on dates and otherwise harassed her. In the latter, Penn teaching assistant Sophia O’Neill says a student with psychiatric issues had delusions of being in a romantic relationship with her, sent romantic messages, and hovered over her.

Supervisors, Coworkers, Nonemployees

Supreme Court sexual harassment precedent doesn’t directly address abuse by nonemployees. It instead provides an employer can be indirectly liable when a supervisor is the harasser and directly liable if negligent when a nonsupervisory coworker is the culprit.

This precedent is founded on agency law and there’s often no agency relationship between an employer and vendors or the like, the Bivens decision said. That puts third-party harassment outside the supervisor and coworker tests and liability can only derive from Title VII of of the 1964 Civil Rights Act’s general intent requirement, Bivens said.

That “got it backwards,” Christine T. Elzer of Elzer Law Firm said. Direct liability is based on a party’s own action or inaction and also applies when an employer fails to prevent or end harassment by a third party, she said.

There’s often only so much an employer can do, Duane Morris LLP’s Gerald L. Maatman Jr. said, citing their general inability to control third parties given the lack of an agency relationship. About the only effective control is to bar them from the premises or cancel their contract, which isn’t always practical. Employees have other potential remedies, including maybe suing for negligent retention if the harassment persists, he said.

‘Incredibly Tough’

Intent is “incredibly tough” to show and in some circumstances “nearly impossible,” said Sanford Heisler Sharp McKnight LLP’s Carolin Guentert. That’s why Bivens is so problematic.

It’s also unnecessary. It’s not like employees prevail “left and right” in third-party harassment cases under a negligence test, Guenert said.

Maatman doesn’t “see it that way.”

A lot of people questioned when Bivens was decided how a plaintiff could ever again establish a third-party harassment claim, Maatman said. But if the employer was on notice and didn’t do anything, that could be tantamount to intent, he said.

“A good plaintiffs’ lawyer will be able to show that” if the facts are there, Maatman said.

‘Academic Gymnastics’

The litigation impact of the standard used is also debated.

Requiring intent only matters for marginal claims, Seyfarth Shaw LLP’s Jules A. Levenson said. He pointed to Bivens’ declaration that some cases where other circuits used a negligence test would’ve come out the same way under an intent requirement and the O’Neill court analyzing and rejecting her claim under both standards.

It’s just “academic gymnastics” to heighten the standard and then say it really doesn’t make a difference in most cases, Hux said.

An intent test increases the likelihood of employers prevailing at summary judgment, Bradley Arant Boult Cummings LLP’s Katherine E. Griffin said. Avoiding a trial in these cases could be huge, she said.

There’s already a dissonance between how judges and juries view the severity or pervasiveness of harassment, which often determines the outcome in hostile environment litigation, she said.

“I think we could see that sort of dissonance” with the intent standard, too, Griffin said. Judges are versed in the difference between intent and negligence while jurors approach things more from a fairness perspective, where the wall between intent and negligence will fall away.

Loper Bright‘s Role

Bivens discounted the reliance of several other circuits in adopting a negligence test on longstanding Equal Employment Opportunity Commission workplace harassment guidance, in part citing Loper Bright Enterprises v. Raimondo. Loper Bright overturned the Supreme Court’s decades-old Chevron USA Inc. v. Natural Resource Defense Council Inc. test for determining when courts should defer to a federal agency’s interpretation of a law.

But what role the agency’s guidance will play in Bivens’ quest for review or O’Neill’s appeal remains unclear. For one, the guidance was rescinded in January 2025. And none of the decisions by the other circuits discussed deference or Chevron.

Even before Loper Bright, EEOC guidance on substantive Title VII provisions like sex discrimination never received Chevron deference, several attorneys said.

Loper Bright got too much attention when Bivens was decided, Guentert said. There’s no need for Bivens or O’Neill to rely on the EEOC guidance. The circuits that adopted a negligence standard didn’t exclusively base their decisions on it, she said.

The cases are Bivens v. Zep, Inc., U.S., No. 25-932, cert. petition filed 2/3/26 and O’Neill v. Trs. of Univ. of Pa., 3d Cir., No. 25-03310, opening brief filed 2/13/26.