In the 2019 Legislative Session, the Maryland General Assembly continued its work to increase protections for workers with respect to workplace harassment (see our previous client alert) resulting in a number of significant changes to the state Human Relations Law, effective October 1, 2019.
The Human Relations Law.
As a reminder, the Human Relations Law prohibits unlawful employment practices against employees and applicants for employment, including, but not limited to, discrimination on the basis of race, color, religion, sex, age, national origin, marital status, sexual orientation, gender identity, genetic information, or disability, or because of the individual’s refusal to take a genetic test.
Because harassment is a form of discrimination, the law is understood to prohibit workplace harassment on the basis of any of these protected characteristics. In addition, the law prohibits employers from discriminating or retaliating against an employee or applicant for employment who has opposed an unlawful employment practice, or made a charge, testified, assisted, or participated in any manner in an investigation, proceeding, or hearing about a claim of discrimination, harassment, or retaliation.
Summary of Changes.
The highlights of the new amendments affecting private sector employers are:
All employment protections under this law will now apply to independent contractors.
Employers with fewer than 15 employees now will be subject to liability under this law if a complaint of harassment is filed against them.
The law will now expressly state that it is a separate unlawful employment practice for employers to harass employees, and defines harassment.
An employer will be strictly liable for harassment by individuals who have managerial/supervisory authority over the complaining employee or applicant.
An employer will also be liable if it knew or should have known about the harassment and did not stop it.
Employees will have 2 years after an alleged act of harassment occurs in which to file an administrative harassment charge with the Maryland Commission on Civil Rights or local agency (whereas a charge of discrimination must be filed within 6 months of an alleged act of discrimination).
Employees will have 3 years to file a lawsuit alleging harassment (but only 2 years for discrimination case).The right to file a lawsuit arises after the administrative charge has been pending for 180 days.
Definition of Employee. The amendments expand the definition of “employee” to include independent contractors. A previous expansion extended protections against workplace discrimination to interns, while carefully noting that this extension did not create an employer/employee relationship between the employer and intern. The legislature did not include a similar disclaimer with respect to independent contractors.
Why is this a concern? Prudent employers take great care to ensure that independent contractors are not treated like employees for any purposes, to avoid the implication that they have been misclassified for purposes of unemployment, workers compensation, tax withholding, wage and hour, and other legal issues for which there is a distinction between employees and independent contractors. Now that the legislature has extended workplace protections to independent contractors, businesses must ensure that independent contractors receive training about anti-harassment policies, procedures for reporting complaints, and protection from unlawful conduct – similar to that provided to employees. Employers, very carefully, will have to provide independent contractors the protections to which they will now be entitled under the law, while protecting against the creation of an unintended employer/employee relationship.
Definition of Employer. Historically, the Maryland Human Relations law has applied only to employers with 15 or more employees. The amendments now create two definitions of employer. Under the first definition, an employer is defined as a person engaged in an industry or business with 15 or more employees. Under the new second definition, if an employee has filed a harassment complaint against their employer, an employer will then be defined as a person engaged in an industry or business with one or more employees.
This amendment creates more questions than answers. First, the amendment does not explain what it means by “file a complaint.” Does this refer to administrative complaints filed with the Maryland Commission on Civil Rights, the Equal Employment Opportunity Commission, or similar local fair employment practices agencies? Does this also refer to internal complaints, formal or informal?
Second, what happens if an employee files a complaint alleging both discrimination and harassment against a small employer? Will the small employer only have liability with respect to the harassment complaint, or – once the harassment complaint is filed - will the small employer now have potential exposure for all unlawful employment practices? (Since many complaints combine allegations of discrimination, harassment, and retaliation, this will become a pressing issue.)
Third, does the exposure for liability occur on a case-by-case basis or, once the first harassment complaint is filed, does a small employer fall under the second definition for all time?
Regardless of the murkiness of the amendment, it is clear that all private-sector Maryland employers, regardless of size, will now be subject to liability for unlawful harassment. Accordingly, all employers should engage in best practices to prevent and correct harassment in the workplace, which includes, but would not be limited to, establishing and implementing policies prohibiting harassment in the workplace and procedures for reporting, investigation, and corrective action.
This adjustment will impact many Maryland employers, although there are many counties in Maryland that already have local civil rights laws preventing discrimination, harassment, and retaliation by small employers (Baltimore County (1+ employees), Frederick County (4+ employees), Harford County (5+ employees), Howard County (5+ employees), Montgomery County (1+ employees), and Prince George’s County (1+ employees). (Please note that these county laws each have their own lists of protected characteristics, some of which are different than those protected under the state law, so coverage may be broader.)
Definition of Harassment. Although it has long been accepted that the Human Relations Law prohibits workplace harassment, the amendment now names it as a separate unlawful employment practice. The law will define harassment as that which is based on race, color, religion, ancestry or national origin, sex, age, marital status, sexual orientation, gender identity, or disability. Strangely, this list of protected characteristics includes “ancestry,” which is not a class otherwise protected under the Human Relations law, and excludes “genetic information,” which is a class protected under the law.
Unlawful Employment Practice. The amendment creates a new unlawful employment practice stating simply that an employer may not “engage in harassment of an employee.” It appears, from the way this is written, that harassment of applicants for employment is not prohibited by this section; however, employer liability for harassment of applicants is specifically addressed in the new liability section.
Strict Liability – Supervisors and Managers.
The amendment codifies two standards for employer liability for unlawful harassment – strict liability and negligence.
Under the strict liability standard, an employer will be strictly liable (meaning there is no defense) for harassing conduct towards an employee or applicant for employment by someone who (1) undertakes or recommends tangible employment actions affecting the employee or applicant such as hiring, firing, promoting, demoting, and reassigning; or (2) directs, supervises, or evaluates the work activities of the employee. It is important to note that liability is based simply on the role and authority of the individual over the employee or applicant, not whether the individual took tangible action against (or in favor of) an employee or applicant who rejected (or accepted) harassing conduct, as would be seen in the classic “quid pro quo” scenario of supervisor harassment. In addition, the fact that this standard applies to those who “direct the work” of employees, suggests that an employer may be held strictly liable (again, no defense) for the actions of front-line supervisors or team leads – not just those with traditional managerial authority.
The second theory of liability is the traditional negligence standard most commonly seen in cases alleging a hostile work environment. Under this standard, an employer will be liable for harassment if the employer knew or should have known that the harassment was occurring and failed to take appropriate action to stop it.
Changes to Deadlines. As detailed in the summary above, the amendment also extends the deadlines for filing administrative charges and lawsuits alleging harassment, while keeping the existing deadlines for discrimination claims. The practical effect of this change will be interesting to see, as agency complaints and lawsuits frequently combine allegations of discrimination, harassment, and retaliation. It remains to be seen whether individuals will take advantage of the extended deadlines or ignore them for fear of missing the deadlines for their discrimination or retaliation claims. Alternatively, we may see multiple filings by a single claimant.
Additional changes. Finally, the amendment contains additional changes, including training requirements for state employees and additional requirements for employees of the University System of Maryland, which are beyond the scope of this client alert.
What Employers Should Do:
- By October 1, 2019, all employers, regardless of size, at a minimum, should develop, distribute, implement, and enforce an anti-harassment policy and procedure for the reporting, investigation, and correction of complaints of discrimination, harassment, and retaliation. The policy should be applicable to all employees, applicants for employment, interns, and independent contractors.
- Training on the policy should be provided at hire (or engagement) and at regular intervals during employment or engagement.
- Additional training should be provided to all front line/team lead, supervisory, and managerial personnel to further educate them about their responsibility to avoid conduct that could be construed as discriminatory, harassing, and retaliatory, and how to respond to and report complaints to authorized personnel. This training should address, in detail, the theories of liability and their role in creating risk for the employer.
- Procedures should be developed and communicated to all company officials responsible for the receipt, investigation, and remediation of discrimination, harassment, and retaliation complaints.
Melissa Jones, co-chair of the Labor and Employment Group, counsels companies on employment, labor, and immigration issues. For more information about these new amendments and other employment concerns, please contact her.
This information has been prepared by Tydings for informational purposes only and does not constitute legal advice.