The United States Court of Appeals for the Fourth Circuit re-affirmed the importance of employers promptly undertaking remedial measures calculated to eliminate discrimination in order to insulate themselves from liability under Title VII discrimination cases.

In this case, the EEOC filed a class action in federal court alleging a discriminatory and hostile work environment at a fiberglass tank plant located in Maryland over a two year period. Among the actions contributing to the hostile environment included the use of racial slurs, threats of KKK actions, and, on at least one occasion, the use of a picture of a person hanging by a noose in order to threaten one or more black employees.

In EEOC v. Xerxes Corp., 2011 U.S. App. LEXIS 8481 (4^th Cir. April 26, 2011), the Fourth Circuit sustained a trial court’s grant of summary judgment on the basis that, after February 3, 2006, the employer’s response to each reported incident was reasonably calculated to end the discrimination. Among other measures, the employer used counseling, written reprimands, suspensions, and even reported some of the more egregious instances of harassment to the local police. On the other hand, the Court of Appeals held that, prior to February 3, 2006, a genuine issue of material fact existed as to whether the employer had notice of racial harassment prior to February 3, 2006 but failed to take appropriate remedial action during that period.

This case shows the importance of taking prompt remedial action when a potential incident of harassment is brought to the attention of management. By promptly responding to reported harassment with appropriate remedial action, an employer may be able to protect itself from Title VII liability. An employer would be best served to establish clear policies of reporting and addressing reported harassment and carefully following these established policies.