Like it or not, employers, the birds and the bees are often at play in the workplace, and romantic relationships between co-workers are a fact of life. The California Supreme Court recently issued a ruling regarding workplace romance that has California employers squawking and buzzing, and that should raise awareness in other states regarding the potential perils of workplace romance.

The issue the California court considered, in Miller v. Department of Corrections, was whether an employee may assert a claim of sexual harassment based on supervisory favoritism towards another employee who is having a consensual affair with the supervisor. Most courts have dismissed such claims, finding that "paramour" favoritism does not constitute sexual harassment of individuals of either sex who are not favored. But the California Supreme Court thought otherwise under that state's civil rights law. It held that consensual sexual affairs may constitute sexual harassment of co-workers not involved in the affair if favoritism is sufficiently widespread to create a hostile work environment. Although not controlling in Michigan or under federal law, the case is a reminder to employers in all jurisdictions regarding the legal ramifications of workplace romance - even where it is entirely consensual.

As you might have expected, the facts in Miller were rather egregious - perhaps material for a Hollywood movie. The plaintiffs, former employees at a women's prison, alleged that the warden gave preferential treatment to three other female employees with whom he was having sexual affairs, and that this constituted unlawful sexual harassment. The warden's affairs were common knowledge in the workplace, and the employees involved made no attempt to keep them private. In fact, the three women frequently squabbled over the warden in the workplace. The plaintiffs alleged that they were denied promotions that were instead given to the warden's paramours, even though the plaintiffs were more qualified, and that they were retaliated against after complaining. Following the reasoning of most courts that have looked at similar issues, the trial court dismissed the claims. The California appeals court agreed.

The California Supreme Court reversed, however, concluding that a hostile work environment can be created, even if the plaintiffs are never themselves subjected to sexual advances, if the atmosphere created by the consensual affair is demeaning to women and conveys the message that the path to success is to sleep with the boss. The court opined that "when sexual favoritism in the workplace is sufficiently widespread it may create an actionable hostile work environment in which the demeaning message is conveyed to female employees that they are viewed by management as 'sexual playthings' or that the way required for women to get ahead in the workplace is by engaging in sexual conduct with their supervisors or the management." The court cautioned, though, that isolated instances of favoritism by a supervisor toward a paramour would ordinarily not constitute sexual harassment.

Obviously, the extreme facts of Miller are likely not to be repeated very often. But the case has received a substantial amount of publicity, and it is not unlikely that copycat claims will arise in other jurisdictions, with plaintiffs' attorneys arguing that the Miller holding should apply under other state or federal civil rights laws.

Miller is a good reminder of the risks employers may face when romance blossoms in the workplace, especially if it is between a supervisor and subordinate - a not uncommon scenario. To minimize risk, employers should consider whether to adopt non-fraternization policies that prohibit or otherwise regulate workplace romances. Some states (not Michigan) have laws prohibiting employers from taking action against employees for lawful off-duty conduct, which could be interpreted to restrict non-fraternization policies. In addition, important that such policies be drafted in a way that does not violate employees' rights under Section 7 of the National Labor Relations Act (NLRA). In Guardsmark LLC, the National Labor Relations Board recently found that an employer's policy prohibiting employees from fraternizing, dating, or becoming "overly friendly" with co-employees did not violate the NLRA. The Board found that employees would reasonably understand that the rule prohibited only "personal entanglements" and not the type of union organizing or other concerted activity protected by the NLRA. Nor was the policy promulgated in response to union activity or applied to restrict employees' right to organize. But some thought it did go too far in inhibiting Section 7 rights, or it would not have been challenged in litigation.

Often employers adopt non-fraternization policies that are less encompassing than the policy in Guardsmark, such as prohibiting supervisors from having romantic relationships with individuals they supervise. This type of policy would require the supervisor to notify the employer if any such relationship began to develop. At that point, several alternative scenarios could play out, including the transfer or resignation of one of the individuals. Employers should also consider whether to require the two individuals to sign an acknowledgement that the relationship is consensual, that they are aware of the company's sexual harassment policy and its reporting obligations, and that their workplace conduct will be professional at all times. Procedures like these not only minimize the risk that one of the employees involved in the affair will end up bringing a sexual harassment complaint, but also the risk that co-workers will complain. In addition, employers should make sure that the sexual harassment training they provide to managers and employees covers the topic of workplace romance.

Although workplace romances and an occasional lawsuit may be inevitable, these steps can go a long way to minimize risk.

Sonja Lengnick

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