She said he assaulted her on a work trip - the court said he wasn't her supervisor
A business trip, a hotel room, and a question about org charts just reshaped employer liability in California.
The state's Court of Appeal on October 5 affirmed summary judgment for Wells Fargo in a sexual harassment case brought by a wealth advisor in the bank's private banking division. The ruling turned on who qualifies as "your" supervisor under the Fair Employment and Housing Act (FEHA).
The worker alleged an investment strategist sexually assaulted her during a January 2020 work trip to Bakersfield. According to the court's recitation, colleagues had dinner and drinks at a hotel, after which the strategist came to the worker's room. She alleged she was too intoxicated to consent and may have been drugged. He maintained the encounter was consensual.
She raised concerns with a colleague about a month later. That colleague, according to the decision, "generally dismissed" them. It took until November 2020 for the worker to report the alleged assault to Wells Fargo's ethics hotline and law enforcement.
Wells Fargo launched an expedited investigation. Over ten months, an internal investigator produced a 28-page report finding the allegations "unsubstantiated." The strategist received a "final notice" affecting his eligibility for raises, bonuses, and promotions.
The worker sued in February 2023 under FEHA. The statute imposes strict liability on employers for harassment by a victim's supervisor - no proof of fault required. For co-worker harassment, the employer is liable only if it knew or should have known and failed to act.
Here was the catch. The worker conceded the strategist was not her supervisor. He could not hire, fire, or approve her time off. Both reported to the same manager. But she argued strict liability should still apply because he supervised lower-level support staff.
The court was unconvinced. His authority over associates had no bearing on his relationship with the worker - to her, he was a co-worker. Two colleagues of equal rank, the court reasoned, would face different liability standards under the worker's reading depending on whether one happened to manage subordinates. "This is not a reasonable interpretation" of the statute, it held.
The ruling did not cap strict liability at direct supervisors. FEHA's definition can reach beyond the immediate reporting line. But the harasser must hold supervisory authority over the complainant.
The worker's fallback arguments were both forfeited for not being raised at the right stage.
For HR professionals, the practical lesson is structural: the reporting line between harasser and complainant sets the liability standard, not the harasser's job title.
