The federal anti-harassment statutes include:

(a) Title VII of the Civil Rights Act of 1964 ("Title VII), which prohibits employment discrimination based on race, color, religion, sex or national origin and covers all private employers with 15 or more employees;

(b) The Age Discrimination in Employment Act of 1967 ("ADEA"), which protects individuals who are 40 years of age or older and covers all private employers with 20 or more employees; and

(c) Title I and Title V of the Americans with Disabilities Act of 1990 ("ADA), which prohibits employment discrimination against qualified individuals with disabilities and covers all private employers with 15 or more employees.

Harassment based on race, color, sex, religion, national origin, age of 40 or older, disability, or protected activity violates the anti-discrimination statutes. The anti-discrimination statutes are not a "general civility code" and thus do not prohibit simple teasing, offhand comments, or isolated incidents that are not "extremely serious." They do require the conduct to be "so objectively offensive as to alter the 'conditions' of the victim's employment."

Conduct alters the conditions of employment if it either:

(a) Results in a tangible employment action, or

(b) Is sufficiently severe or pervasive that it created a hostile work environment.

A tangible employment action is "a significant change in employment status", such as a significant change in duties, even if salary and benefits are unchanged, and can include a change that blocks the employee’s opportunity for promotion or salary increases. A tangible employment action requires an official act of the business; is usually documented in the business records; may be subject to review by higher level supervisors; and may require the formal approval and use of the company’s internal processes. A tangible employment action usually causes direct economic harm, and would include hiring and firing, promotion and failure to promote, demotion, undesirable reassignment, a decision causing a significant change in benefits, compensation decisions, and work assignment.

An action resulting in an insignificant change in employment status, such as a change in job title with no change in salary, benefits, duties, or prestige, is not tangible. On the other hand, if the new title is less prestigious and effectively constitutes a demotion, the action would be tangible.

Because no affirmative defense is available and an employer is always liable for unlawful harassment by a supervisor that results in a tangible employment action, it is important to know what constitutes a "tangible employment action"

A supervisor is an employee with the authority to (i) undertake or recommend tangible employment decisions affecting the employee; or (ii) direct the employee's daily work activities. "Tangible employment decisions" significantly change another employee's employment status, such as hiring, firing, promoting, demoting, and reassigning the employee. An individual who has the authority to recommend tangible job decisions affecting an employee qualifies as his or her supervisor even if the individual does not have the final say.

If the individual does not have the authority to undertake or recommend tangible job decisions but does have the authority to direct another employee's day-to-day work activities, that individual qualifies as his or her supervisor. For this reason, writing and enforcing job descriptions limiting the authority of positions could be important in determining the authority of employees in relation to other employees. If an employee reasonably believes a person has authority over the employee or the ability to significantly influence employment decisions affecting the employee, the employer maybe subject to vicarious liability for harassment by the person. Again a strong reason for accurate, clear job descriptions setting out authority and a chain of command.

If a harasser has no actual supervisory power over the employee, and the employee does not reasonably believe that the harasser had such authority, then the standard of liability for co-worker harassment applies.

If supervisor harassment does not result in a tangible employment action but does create an unlawful hostile environment, the employer can attempt to avoid liability or limit damages by showing both that:

(a) the employer exercised reasonable care to prevent and correct promptly any harassment; and

(b) the employee unreasonably failed to take advantage of any preventive or corrective opportunities provided by the employer or to avoid harm otherwise.

Consequently, an employer must have an effective complaint procedure that encourages employees to report harassing conduct before it becomes severe or pervasive. If an employee promptly uses that procedure, the employer should be able to stop the harassment before actionable harm occurs. For example, when an employee reports improper supervisory conduct, such as crude sexual comments or gestures, and management promptly investigates and undertakes appropriate disciplinary measures so that no further harassment occurs, there will likely be no liability.

It is important for employers to train their supervisors because if they do not and the supervisor engages in unlawful harassment, the employer will be liable. The anti-discrimination statutes make employers responsible for the discriminatory acts of their supervisors. If an inadequately trained supervisor rejects a candidate for promotion because of race, color, gender, or other protected category based bias, the employer will be liable regardless of whether the employee complained to higher management and regardless of whether higher management had any knowledge about the supervisor's motivation. The way to avoid liability is by being proactive – properly training the supervisor so that improper employment activities do not occur.

Proper training, policies, and procedures can protect employers from supervisory discrimination not resulting in tangible employment actions if the employer proves that it exercised reasonable care in preventing and correcting the harassment and that the employee unreasonably failed to avoid all of the harm.

To establish an affirmative defense, the employer must show that it undertook reasonable care to prevent and promptly correct harassment. One way for the employer to accomplish this is to have established an effective anti-harassment policy and a complaint procedure and to have circulated and enforced them.

Just having a written policy and procedure alone is not sufficient. The employer must make sure they are carried out and enforced. This requires training and follow-up on both the policies and the procedures. Additionally, the employer must take reasonable care to prevent harassment at all times. This means the approach cannot be piecemeal, but rather must be applied across the board, which again requires training and accountability.

Normally an effective policy and complaint procedure will be in writing and provided to each employee and redistributed periodically. An effective policy and complaint procedure requires that supervisors be well trained on what the policy says and prevents and on how complaints are to be handled under the complaint procedure. Both should be written in a way that will be understood by all employees in the employer's workforce. The employer should post them in central locations, make both an integral part of the employee handbook, and train both supervisors and employees on their rights and responsibilities.

An effective anti-harassment policy and complaint procedure should clearly explain what conduct is prohibited and assure employees who complain of or provide information related harassment that the employer will protect them from retaliation (naturally, the employer must make sure that such protection is carried out – through training and follow-up). The complaint procedure must set out an accessible avenue of complaint and assure the employee that the employer will protect the confidentiality of harassment complaints to the extent possible. The complaint procedure should provide a prompt, thorough, and impartial investigation, and assure the employee that the employer will take immediate and appropriate corrective action when it determines that harassment has occurred.

Each company should have a prompt, thorough, and impartial process to investigate any harassment claims. Upon learning of any claims of harassment, the company should first decide if a detailed fact-finding investigation is necessary. If the alleged harasser admits or does not deny the accusation, there would be no need to interview witnesses, and the employer could immediately determine appropriate corrective action. On the other hand, when the accused denies the accusations, the company must begin a fact-finding investigation immediately and begin interviewing the accuser, the accused, and any witnesses. The company may have to undertake intermediate measures before completing the investigation to ensure that further harassment does not occur, such as scheduling changes so as to avoid contact between the parties; transferring the alleged harasser; or placing the alleged harasser on non-disciplinary leave with pay pending the conclusion of the investigation. The complainant should not be involuntarily transferred or otherwise burdened, since such measures could constitute unlawful retaliation. Giving the investigation prompt and serious attention is imperative. Typically investigations that have passed regulatory muster have been completed in days, not weeks.

Merely have an anti-harassment policy and procedure is not sufficient to satisfy the employer's responsibility to exercise reasonable care to prevent and correct harassment. The employer has an additional duty to prevent harassment by its supervisors by screening them, training them, and monitoring their performance. The employer must train all of its supervisors and managers to address or report all complaints of harassment to appropriate officials regardless of whether they are officially designated to take complaints and regardless of whether a complaint was framed in a way that conforms to the organization's particular complaint procedures. An effective complaint procedure must require supervisors with knowledge of harassment to report the information to those in position to take appropriate action and must require supervisors to report not only "formal" but also "informal" complaints of harassment.

In order to exercise due care, management must correct harassment coming to its attention even if no complaint is filed, such as correcting areas in the workplace with graffiti containing racial or sexual epithets. The company must be proactive and "have its ear to the ground", because employers have been found liable when the courts determined that the harassment was so pervasive that higher management was deemed to have constructive knowledge of it, particularly in situations where the harassment was so broad in scope and so permeated the workplace that the court found it must have come to the attention of someone authorized to do something about it. This also requires the company to be aware of the conduct of its supervisors and managers and make sure they understand their responsibilities under the organization's anti-harassment policy and complaint procedure. Periodic training of those individuals can help achieve that result. Such training should explain the types of conduct that violate the employer's anti-harassment policy; the seriousness of the policy; the responsibilities of supervisors and managers when they learn of alleged harassment; and the prohibition against retaliation.

An employer should take reasonable steps to prevent harassment and investigate and remedy claims because the second part of the employer’s affirmative defense requires the employer to prove that the aggrieved employee "unreasonably failed to take advantage of any preventive or corrective opportunities provided by the employer or to avoid harm otherwise." Thus an employer who exercises reasonable care is not liable for unlawful supervisor harassment so long as the conduct does not result in a tangible employment action and so long as the aggrieved employee failed to take advantage of the complaint and investigative process. If the employee could have avoided some but not all of the harm, then damages can be reduced accordingly.

An employee’s reasonable fear that its use of the complaint procedure will result in retaliation will defeat the employer’s affirmative defense. To prevent that from happening, the employer must clearly communicate and enforce a policy that no employee will be retaliated against for complaining of harassment.

Remove Obstacles to Complaints: It is reasonable for an employee to not use the employer's complaint procedure if there are unnecessary obstacles, such as undue expense by the employee, inaccessible points of contact for making complaints (the hours of duty or location at a separate facility make the official responsible for taking complaints unavailable to the employee), or unnecessarily intimidating or burdensome requirements.

Increase employee confidence in the complaint process: An employee’s reasonable belief that the complaint process is ineffective will make the affirmative defense unavailable. Such would be the case if the complaint process required the employee to complain to the harassing supervisor or if the employee was aware of instances in which co-workers' complaints failed to stop harassment. The employer can take steps to increase employees' confidence in the efficacy of the complaint process by posting and training them on corrective and disciplinary measures undertaken to stop harassment.