California Court Defines Supervisor Harassment Liability Standards

California court rules strict liability applies only if harasser directly supervises plaintiff.

In Doe v. Wells Fargo Bank, N.A., the California Court of Appeal, Second Appellate District, clarified employer liability for harassment claims under the Fair Employment and Housing Act (FEHA). The October 5, 2026, decision addressed whether strict liability applies to employers when a harassing employee holds a supervisory role but does not directly supervise the plaintiff.

The plaintiff, a wealth advisor at Wells Fargo, alleged that an investment strategist sexually harassed and assaulted her on a business trip. Although the strategist supervised other employees, he did not have supervisory authority over the plaintiff. The trial court granted summary judgment to Wells Fargo, concluding that strict liability did not apply since the harasser was not the plaintiff's direct supervisor. The court also found that the bank responded promptly and appropriately to the complaint.

The Court of Appeal affirmed, holding that strict liability for harassment under FEHA attaches only when the alleged harasser acts in a supervisory capacity over the plaintiff. This ruling emphasizes that an employee’s supervisory title or authority over others does not automatically create strict employer liability for harassment claims involving different employees.

Eric Witt, legal analyst, summarized the ruling: "Employers should understand that an employee’s title or supervisory authority over others does not automatically expose an employer to strict liability for harassment." This decision signals to employers and legal counsel the importance of clearly defining supervisory roles and tailoring harassment prevention policies accordingly.

While Wells Fargo's internal investigation details were not disclosed, the court noted the employer was not negligent given its response. This case sets a significant legal precedent for how California courts interpret supervisory liability under FEHA and impacts how companies handle harassment complaints not involving direct supervisors.