New Developments

We wish to bring a recent decision of the Maine Supreme Judicial Court to your attention which raises new uncertainties about who may be sued in Maine, in cases of alleged employment discrimination. The Court issued two different decisions in the case, "flip-flopping," on the question of whether supervisors can be sued individually. Ultimately, the Court decided to leave the question open, even though most of the federal cases to address this issue under parallel federal law have held that only employers may be sued.

By way of background, this new case is the first Maine case to address the potential liability of supervisors under Maine anti-discrimination law. Federal courts have usually held--under federal law--that supervisors or other managerial employees cannot be sued for employment discrimination, on the grounds that the purpose of anti-discrimination law is to change the employment practices of the employer. Most federal courts have held that Congress desired to keep the focus on the employer, rather than individual supervisors. Arguably, this would insure that employers would comply with the law rather than trying to pass the blame on to "loose cannon" middle-management employees.

The recent Maine case is Gordan v. Cummings, 2000 ME 68. The case arose following the merger of two marine businesses that had been run and owned by two different families. Shortly after the merger, the business fired a sales person, Ms. Gordan, who was also a member of one of the families. Ms. Gordan alleged age and sex discrimination under Maine's Human Rights Act. In state court, she sued her supervisors, members of the other family, and their pre-merger business. She did not sue the merged corporation that was her legal employer. The trial court dismissed the claims against the supervisors, following the federal precedents discussed above.

On appeal, the Maine Supreme Judicial Court initially reinstated the claims against the supervisors. That decision generated considerable controversy, and numerous claims against supervisors were filed shortly thereafter in other cases. Three months later, on July 25, 2000, the Court withdrew its first decision, finding that, for technical reasons, it did not need to decide the issue. Ms. Gordan lost her discrimination claims against the supervisors, but only because of procedural issues.

Permitting supervisors to be sued for alleged employment discrimination can have a significant effect on whether suit occurs, whether insurance is involved, and the dynamics of the litigation. Supervisors, rather than employers, are more likely to be sued in the case of a closely-held corporation, where a disgruntled employee may also be a part owner. In the absence of supervisor liability for discrimination, disputes among employee owners will be resolved according to contract or business law, and discrimination claims will often not be filed against the employer itself. Most contract and business claims will not be covered by insurance.

Regardless of the size and ownership of the employer, a suit against a supervisor for discrimination will typically proceed differently than a suit against the business. If the business views the supervisor as a loose cannon, the business is less likely to indemnify and defend him or her than would be the case in suits involving auto accidents, property damages, etc. The dynamics of the discrimination case will then likely involve finger pointing among the parties that are sued. This may provide the plaintiff with the chance to obtain admissions from the supervisor, who will try to show that the employer condoned or even ordered his actions.

Insurers, employers and supervisors will need effective representation in cases involving suits against supervisors. For the time being, the Maine Human Rights Commission is accepting and processing claims against supervisors as well as employers. Some of those cases will go on to court. Some of these claims may be covered by employer liability insurance policies. The Commission, employers, insurers, employees and the trial courts statewide will all have to handle these cases effectively until the Supreme Judicial Court decides the question once and for all. In all cases, the supervisor should consider bringing a motion to dismiss the suit, citing precedents under federal law.

Thomas R. Kelly, Esq.