The Faragher-Ellerth Defense: How California Employers Can Still Win a Harassment Claim

An employee reports harassment by a supervisor. The company has a written policy, required training, and a reporting procedure. Under federal Title VII, those facts may support the Faragher-Ellerth defense. Under California FEHA, the law does not eliminate an employer's liability for supervisor harassment.

In State Department of Health Services v. Superior Court (McGinnis) (2003), the California Supreme Court rejected the Faragher-Ellerth defense under FEHA but recognized a narrower avoidable-consequences doctrine for supervisor sexual-harassment claims that can reduce damages.

The distinction matters. For supervisor harassment, prevention and training help build the record but do not erase FEHA liability. For coworker and qualifying nonemployee harassment, prompt and appropriate corrective action can directly affect the employer's liability. Here's how each framework works and what California employers should document when a complaint arrives.

Key Takeaways

• FEHA imposes strict liability for supervisor harassment. Faragher-Ellerth was rejected in McGinnis (2003).

• For supervisor sexual-harassment claims, California recognizes an avoidable-consequences defense that can reduce damages but does not eliminate liability.

• Faragher-Ellerth still applies to federal Title VII claims, so plead it there.

• FEHA's "supervisor" definition includes anyone with the responsibility to direct others using independent judgment, a broader standard than the federal Vance test.

• For coworker and third-party harassment, prompt and appropriate corrective action can defeat liability entirely.

• Required training is useful evidence of preventive efforts, but it is not a substitute for an accessible reporting process, prompt investigation, appropriate corrective action, and consistent enforcement.

Is the Faragher-Ellerth Defense Available to California Employers?

Not for supervisor harassment under FEHA. The defense comes from two 1998 U.S. Supreme Court cases, Faragher v. City of Boca Raton (524 U.S. 775) and Burlington Industries v. Ellerth (524 U.S. 742). Under federal law, an employer can defeat liability for supervisor harassment that involved no tangible employment action such as discharge, demotion, or an undesirable reassignment by proving two things:

1. It exercised reasonable care to prevent and promptly correct harassment.

2. The employee unreasonably failed to use the complaint procedures or otherwise avoid the harm.

California went a different way:

Does the Faragher-Ellerth Defense Work in a Sexual Harassment Case in California?

It works only if the plaintiff sues under federal law. In State Department of Health Services v. Superior Court (McGinnis) (2003) 31 Cal.4th 1026, an employee alleged hostile-environment harassment by a supervisor. The employer argued Faragher-Ellerth should end the case. The California Supreme Court held that FEHA's strict-liability rule leaves no room for the federal defense, which rests on agency principles.

Two practical consequences follow:

• A Title VII claim is the only place the defense still does its full job. If a complaint pleads federal claims alongside FEHA, raise it for those.

• Don't build your whole strategy on it. FEHA covers smaller employers, has no damages caps, and imposes strict liability for supervisors. Plan around FEHA first.

What Is the Avoidable Consequences Defense, and What Do You Have to Prove?

McGinnis gave California employers a narrower substitute. You must plead and prove all three elements:

1. You took reasonable steps to prevent and correct workplace harassment.

2. The employee unreasonably failed to use the preventive and corrective measures you provided.

3. Reasonable use of those measures would have prevented at least some of the harm.

Here's what that defense does, and what it doesn't:

• It limits damages. It reduces what the employee can recover for harm they could have avoided had they reported.

• It does not defeat liability for supervisor harassment. The claim survives; its value shrinks.

• The burden is yours. You carry it as an affirmative defense.

• Its reach beyond sexual harassment is unsettled. The jury instruction (CACI 2526) is titled for sexual harassment by a supervisor, though some commentators expect courts to extend the doctrine to other FEHA claims.

Who Counts as a "Supervisor" Under California Law?

More people than you might expect. FEHA's definition is broader. It includes individuals with authority to hire, transfer, promote, assign, reward, discipline, or discharge employees; responsibility for addressing employee grievances; or responsibility for directing employees' daily work, including making effective recommendations on those actions, when the authority requires independent judgment rather than routine or clerical work.

That matters because the label decides the standard. Supervisor harassment means strict liability. Coworker harassment means a negligence-style test you can win.

What If the Harasser Is a Coworker or a Non-Employee?

This is where prompt, appropriate corrective action can prevent employer liability under the applicable FEHA standard, depending on what the employer knew or should have known and the circumstances of the response.

For harassment by a coworker or qualifying nonemployee, FEHA can impose liability when the employer knew or should have known of the conduct and failed to take immediate and appropriate corrective action. A fast, documented response doesn't just reduce damages here. It goes to liability itself.

What Evidence Proves You Took "Reasonable Steps"?

Both California defenses turn on what you can present to the court.

Failure to prevent harassment is separately actionable under Gov. Code §12940(k), but California courts generally require an actionable underlying discrimination, harassment, or retaliation claim before a plaintiff can prevail on the failure-to-prevent theory.

If you'd like a legal review of your harassment complaint procedure before a complaint arrives, DefendMyBiz offers a paid 1-hour consultation with its FEHA/EEO Defense team.

What Professionals Are Asking About Harassment Complaints

The practical employer question is usually not whether a harassment policy exists. It is what management should do in the first few hours after someone reports misconduct.

In an r/AskHR discussion, a general manager at a Southern California business asked: “One of my female employees has accused a male employee of sexual harassment off company property after hours. How do I handle this?”

The manager explained that this was his first sexual harassment complaint and described the steps he had already taken. That is the employer-side problem California's harassment rules create: once management becomes aware of a complaint, the quality and timing of the response matter.

A separate 2026 discussion in r/humanresources featured an HR professional dealing with a harassment allegation involving a subcontractor and an employee who did not want to be identified or to participate further in the investigation.

The HR professional was looking for practical guidance on how to proceed with the investigation despite limited cooperation.

These discussions are not legal authority, but they reflect the questions employers and HR teams actually face:

• Who should receive and document the initial complaint?

• When should HR or outside counsel become involved?

• How quickly should the accused employee be separated from the complainant?

• What should the employer do when a complainant or witness will not cooperate?

• Who should conduct the investigation?

• What should be preserved before the investigation begins?

• How should the employer document corrective action?

• What should happen to any subsequent scheduling, disciplinary, performance review, or termination decisions involving the complainant?

For California employers, the practical answer is the same: treat the first report as the beginning of an evidence record. Preserve the complaint, document when management became aware of it, conduct a prompt and appropriately scoped investigation, take corrective action when warranted, and document the steps taken.

What Should You Do the Day a Harassment Complaint Lands on My Desk?

1. Preserve the complaint itself and the reporting path. Record who received the complaint, when they received it, what they understood the allegation to be, and when it was escalated to HR or counsel.

2. Separate the parties. Don't let the accused supervisor control the complainant's schedule, assignments, or reviews while you investigate.

3. Start the investigation promptly with a neutral, trained person. Investigation delay is often important evidence in a plaintiff's challenge to the adequacy of the employer's response.

4. Document each step as it happens, including dates, interviews, and findings.

5. Act on the result and follow up. Corrective action with no check-in leaves the record incomplete.

6. Watch every later decision about the complainant. Discipline, schedule changes, or termination after a complaint invite a retaliation claim.

Our guide on defending a retaliation claim after a documented firing explains why the timing of documentation decides those cases, and the same principle applies when the complaint is about harassment. Our guide to wrongful termination defense covers the next step if a termination follows.

If a harassment complaint has already been filed with the CRD or EEOC, or an employee's attorney has sent a demand letter, contact DefendMyBiz for a free 15-minute consultation.

Conclusion

California does not allow the Faragher-Ellerth defense against supervisor harassment under FEHA. California imposes strict liability on employers for supervisor harassment under FEHA. In supervisor sexual-harassment cases, McGinnis recognizes an avoidable-consequences defense that can limit damages but does not eliminate liability.

Build one record that serves every theory, with a clear policy, current training, a fast, neutral investigation, documented correction, and protection from retaliation. That record reduces damages in supervisor cases and can win coworker cases outright.

If you're already facing a harassment complaint with the CRD or EEOC, or a demand letter from an employee's attorney, DefendMyBiz offers a free 15-minute consultation. We represent employers only.

Frequently Asked Questions

Disclaimer: The above content is for informational purposes only. This is not legal or tax advice. Laws, IRS guidance, and withholding requirements can change, and outcomes depend on specific facts. You are advised to contact a qualified attorney for any legal advice.