Court Ruled Employers Liable Only for Intentional Harassment

On August 8, 2026, the 6th US Circuit Court of Appeals set a new intent-based standard for third-party workplace harassment.

Updated on Sept. 30, 2026 in Human Resources

Court Ruled Employers Liable Only for Intentional Harassment

Live Poll

Should employers be legally liable for workplace harassment committed by their customers or clients?

The 6th US Circuit Court of Appeals ruled on August 8, 2026, that employers are only liable for harassment committed by non-employees if they intended for the harassment to occur. This decision rejects the previous negligence standard for third-party liability.

Why it matters

This ruling establishes a significant new legal threshold for workplace harassment claims. By requiring proof of intent, it alters how companies must approach allegations of harassment involving third parties.

Zep, Inc. eliminated 23 sales roles in 2021 as part of a broader workforce reduction. The court ruling now governs liability across a jurisdiction covering Kentucky, Michigan, Ohio, and Tennessee.

The players

6th US Circuit Court of Appeals

This federal court holds jurisdiction over cases originating in Kentucky, Michigan, Ohio, and Tennessee.

Dorothy Bivens

She was a sales representative who sued her employer, Zep, Inc., for claims involving a hostile work environment.

Zep, Inc.

The company is a business entity that was the subject of a lawsuit regarding workplace harassment and retaliation.

The details

The decision arose from a lawsuit filed by Dorothy Bivens against Zep, Inc., alleging a hostile work environment and retaliation under Title VII. A district court had previously ruled in favor of Zep, Inc., which had reassigned a client to a different sales team following a report of harassment.

Dorothy Bivens worked as a sales representative for Zep in 2021.
The 6th Circuit Court of Appeals issued its ruling on August 8, 2026.

Market Landscape

This ruling creates a split between the 6th Circuit and other federal courts regarding the interpretation of Title VII of the Civil Rights Act of 1964. The decision narrows the scope of employer liability, potentially creating a distinct legal environment for businesses operating within these specific states.

Employees may face a higher burden of proof when reporting harassment caused by non-employees within the 6th Circuit states. Businesses in these areas may adjust their internal HR policies to align with this new intent-based liability requirement.

The takeaway

Companies operating in Kentucky, Michigan, Ohio, and Tennessee should review their third-party harassment reporting protocols in light of this new precedent. Legal observers note that this decision highlights a growing divide in federal interpretation of employer responsibilities.