In an episode of Seinfeld, George Costanza lost his job after the cleaning woman, with whom he had sex on his desk in his office after hours, ratted him out to management.
Could he have sued for sexual harassment? According to Stevens v. Saint Elizabeth Med. Ctr. (6th Cir. 8/29/13), the answer is no.
Caroline Stevens, worked as the personal assistant to defendant Dr. Donald Saelinger, the Chief Executive Officer of Patient First, which was later acquired by Saint Elizabeth Medical Center. After the hospital discovered a recently ended a consensual relationship between the two (which included after-hours sex in the office ), it offered both the option of resignation or termination. Stevens refused to resign, yada yada yada, and was fired.
The 6th Circuit affirmed the dismissal of both her sexual harassment claim (premised on some post-break-up love notes and other protestations of continued affection at the office) and her retaliation claim (premised on her termination after she had written a letter to Saelinger stating a desire to do her job in a non-threatening environment).
There is nothing wrong with employees dating. Nothing good, however, comes from a boss having relations with a subordinate employee, especially one who is a direct report. No matter your corporate position on employee romance, it’s probably best to prohibit managers and supervisors from dating (etc.) their direct reports. Untangling relationships is complicated enough. You do not need to complicate it more by engaging the possibility (and the resulting legal risk) of an employee reporting to an ex.
As for George’s possible legal claims, it’s no soup for you.