January 29, 2026
A New Standard? Employer Liability for 3rd Party Harassment
Q: Is an employer liable for the unlawful harassment of its employee by a customer, client, visitor, vendor, or other third party?
A: It depends. No surprise, right? But the traditional answer is being reconsidered by some courts. Since the EEOC rescinded its entire 2024 Guidance on Workplace Harassment, that led me to revisit some recent cases and wonder if the EEOC will publish related guidance to address this trend.
Historically, the U.S. EEOC and several federal circuit courts of appeals have applied a “knew or should have known” standard. An employer may be liable for unlawful workplace harassment by a third party if it knew or should have known about the harassment and failed to take reasonable measures to correct it. There is a higher standard of review when a manager or supervisor unlawfully harasses an employee.
Last summer, the 6th U.S. Circuit Court of Appeals (covering MI, OH, KY, & TN), departed from that reasoning. In that case, an employee alleged she faced a hostile work environment because of a client’s sexual harassment during a meeting in the client’s office. The court wrote, “we note that our holding departs from the conclusion reached by most circuit courts to have addressed the issue as well as the EEOC’s reading of Title VII.” Instead, the court held that the standard for employer liability for 3rd party harassment requires a showing that the employer intended for the harassment to occur. That was in August 2025. Some speculated whether other courts would follow.
In October, one did. In October the U.S. District Court for the Eastern District of Pennsylvania applied the same standard when a teaching assistant alleged a student subjected her to a hostile work environment. This court wrote, “We are guided in part from recent comprehensive analysis from the Court of Appeals for the Sixth Circuit (absent guidance from our Court of Appeals) persuading us the teaching assistant must show the university was substantially certain its actions would cause harassment.”
It remains to be seen if this is a trend that will continue. As the PA court points out, they rely on the 6th Circuit decision “absent guidance from the Court of Appeals.” This suggests their answer might be different if the Plaintiff wins on appeal.
What does this mean for employers? Raising the standard for liability may be good news for employers. It may also not serve as a safe harbor. Employers may be wise to continue all the proactive practices they (hopefully) already have in place. Continue to train your employees about their rights and responsibilities to work in a non-hostile, respectful, and civil workplace – virtual and in person. Train managers about their elevated duties to prevent and correct unlawful harassment and the legal liability they may create for themselves should they fail to do so.
