For workers to have legal standing to sue, a supervisor must be involved in harassment or discrimination.
The current Supreme Court has made no secret of its pro-business leanings. In 2010, its Citizen's United ruling opened the door to unlimited corporate donations to political campaigns.
In this milestone week, with rulings that gutted the Voting Rights Act and overturned the federal Defense of Marriage Act, the court also made decisions that favored businesses.
In its Vance vs. Ball State decision Monday, the Supreme Court curtailed the ability of employees to sue for workplace discrimination under Title VII of the Civil Rights Act of 1964.
The case involved employee allegations of a hostile work environment based on race at Ball State University. The Supreme Court decided against the plaintiff Maetta Vance, an African-American kitchen worker. In so doing, it created a new definition of supervisor, essentially as someone who can take tangible actions against the employee, for example, by hiring, firing, or promoting them.
The court majority placed a significant barrier in front of employees claiming harassment or discrimination in the future. This means, as a business owner, you have less legal risk of a descrimination suit--but you're not off the hook. Supervisors are still also responsible for making sure a non-discriminatory workplace environment exists.
"The take-away from this decision is that employers will now only be liable if they are negligent," says Charley Moore, chairman and founder of RocketLawyer, an online legal services company in San Francisco.
In order not to be negligent, Moore recommends small businesses take several important steps. These include developing an integrated reporting system to manage complaints. You should give employees a method to report incidents, write a code of conduct, perhaps in an employee handbook, and train managers as well as all employees about appropriate workplace behavior.
You don't want to create a hostile work environment--or leave yourself open to a lawsuit. "If the employee can prove harassment by the supervisor, then the company is most likely going to be liable," Moore says.