Wednesday, July 11, 2007

Vicarious release held ineffective

Edwards v. Ohio Inst. of Cardiac Care is not earth shattering for what it says, but I write because of the novel argument made by the employer in trying to escape a jury verdict. It is well-settled Ohio law that supervisors and managers are jointly and severally liable with their employers for their own acts of discrimination. After suffering a $200,000 jury verdict on a sexual harassment claim, the employer in Edwards made the novel argument to the appellate court that the plaintiff's pretrial settlement with the accused supervisor extinguished the company's liability. While the Court seemed impressed with the creativity of the argument, it ultimately rejected it (the case was reversed on other grounds relating to the jury instructions). The Court reasoned that the supervisor is not liable simply as the employer's agent, but is liable because the statutory definition of "employer" in R.C. 4112.02(A)(2) includes individual supervisors and managers whose conduct violates the law. In other words, the supervisor and the company are co-employers. Thus, a settlement with one does not extinguish the liability of the other. In other words, if you want to obtain a release, you have to make sure you are a party to the agreement.