Texas Supreme Court Upholds Right of Employee to Sue for Sexual Assault!

By Robert G. Chadwick, Jr., Managing Member, Seltzer Chadwick Soefje & Ladik, PLLC

In October 2011, a female associate at the Frisco, Texas Steak N Shake restaurant was allegedly sexually assaulted by her supervisor.  She subsequently filed a common law assault suit claiming Steak N Shake was responsible for the misconduct of a vice principal. There are many likely reasons why Steak N Shake was not also sued under the Texas Commission on Human Rights Act (“TCHRA”), which prohibits gender discrimination in employment. Chief among these likely reasons is the $300,000 maximum damage cap imposed by the TCHRA, which does not exist as to common law assault claims.

In reliance upon the 2010 Texas Supreme Court opinion in Waffle House, Inc. v. Williams, the trial court determined that the TCHRA provided the exclusive remedy for workplace sexual harassment, which included the plaintiff’s assault claim.  Accordingly, the trial court granted Steak N Shake’s motion for summary judgment.  Upon appeal, Dallas’ Fifth District Court of Appeals affirmed the trial court’s ruling.

In a February 24, 2017 opinion, the Texas Supreme Court reversed the summary judgment ruling. The Court confirmed again that, “[w]here the gravamen of a plaintiff’s case is TCHRA covered harassment, the Act forecloses common-law theories predicated on the same underlying sexual-harassment facts.”  However, “where the gravamen of the plaintiff’s case is assault, we hold that the TCHRA does not preempt a common law assault claim.”

For Texas employers, the significance of the decision in B.C. v. Steak N. Shake Operations, Inc. is not limited to a potential exposure to higher damage awards.  Employers are encouraged to review their employment practices liability insurance policies to determine whether assault claims are excluded from coverage.

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