|The Fifth Circuit recently held in Arredondo v. Elwood Staffing Servs., No. 22-50502 (5th Cir. Aug. 25, 2023) that an employment agency furnishing employees to another company must have actual or constructive knowledge of the hostile work environment before it can be held liable for these actions.
Plaintiffs are two women, Elwood Staffing Services, Inc., placed at a job site working for Schlumberger, Ltd. A senior coworker at their site was a lesbian who sexually assaulted one of the women and harassed the other. Plaintiff submitted a complaint about sexual harassment, and Schlumberger terminated her. The other Plaintiff later resigned. Together, the women filed suit in federal court alleging violations of Title VII. The district court entered a mixed summary judgment order, finding the women had viable claims against Schlumberger but releasing Elwood from the suit. Schlumberger subsequently settled with Plaintiffs at mediation. The women challenged the order to the extent it granted summary judgment in Elwood’s favor on appeal.
The Fifth Circuit affirmed. The court explained that Plaintiff does not provide evidence that Elwood knew what was happening to her in the gun shop. She did not report the discrimination and abuse she experienced to Elwood. And a report would not have been and was not a wasted action. Nor does she provide evidence that Elwood should have linked the other Plaintiff’s complaints to other employees. At best, she has shown that Elwood had good reason to ask Schlumberger some questions, which, of course, it did. But that does not meet the applicable knowledge element in her cause of action. The court concluded that Elwood did not have actual or constructive knowledge of the hostile work environment experienced by Plaintiff. The court concluded that Plaintiffs sought to hold the wrong party liable for their injuries. They cannot establish why Elwood should be held responsible for the misconduct of Schlumberger’s employees.