Fourth Circuit Holds that Employers May be Held Liable for Workplace Gossip

The Fourth Circuit held that the answer is “yes”; driving home that employers should not take workplace gossip lightly.

Parker began her employment at Reema as a warehouse clerk. After six promotions, however, she advanced to the position of assistant operations manager.

Soon thereafter, Parker learned that certain male employees, including the jobsite’s highest ranking employee, were circulating false rumors that she had slept her way to her new job.

As the rumor spread, Parker’s co-workers and subordinates treated her with open resentment and disrespect. And, her work environment became increasingly hostile.

Parker sued Reema under Title VII. But, the United States District Court for the District of Maryland granted Reema’s motion to dismiss, holding that the offending rumors were based not on gender, but on false allegations about Parker’s conduct.

The Fourth Circuit reversed. The District Court, it held, had failed to consider the “sex-based nature of the rumor and its effects.” Parker, according to the Fourth Circuit, “plausibly invoke[d] a deeply rooted perception — one that unfortunately still persists — that generally women, not men, use sex to achieve success. And with this double standard, women, but not men, are susceptible to being labelled as ‘sluts’ or worse, prostitutes selling their bodies for gain.”

In short, because “‘traditional negative stereotypes regarding the relationship between the advancement of women in the workplace and their sexual behavior stubbornly persist in our society,” and “these stereotypes may cause superiors and coworkers to treat women in the workplace differently from men,” the Fourth Circuit concluded that Parker plausibly alleged that she suffered gender-based harassment.

The Takeaway

Malicious gossip in the workplace serves no useful purpose. To the contrary, it can undermine employee morale and productivity and hobble employer efforts to recruit and retain dedicated workers.

What’s more, under Parker, employers in the Fourth Circuit — Maryland, North Carolina, South Carolina, Virginia, and West Virginia — may face liability, under the anti-discrimination law, if supervisors and managers spread gender-based gossip about employees and applicants and employers fail to take prompt and appropriate disciplinary action against employees who do.

Parker may influence case law development outside of the Fourth Circuit. So, employers, there and beyond, should not tolerate malicious gossip.