Time to report

Under previous law, employees had 180 days to file a charge of unlawful employment practices with the Texas Workforce Commission. HB 21 close to doubles this limitations period, allowing employees 300 days after the alleged conduct to file a charge of sexual harassment. This 300-day window is now consistent with federal law, under which employees have 300 days to file a sexual harassment charge with the Equal Employment Opportunity Commission. Notably, the newly-expanded window applies only to sexual harassment claims, and not to discrimination claims of other types (such as race or religion).

Expanded liability

Under SB 45, any person who employs one or more employees now may be liable for sexual harassment. The new law carves away the former protection for employers with fewer than 15 employees, now making Texas law more expansive than Title VII.

SB 45 defines sexual harassment as “an unwelcome sexual advance, a request for a sexual favor, or any other verbal or physical conduct of a sexual nature” under certain circumstances outlined in section 21.141(2) of the Texas Labor Code. Before the new law, the Texas Labor Code did not provide a cause of action against individuals for sexual harassment. Now, however, managers, supervisors, human resource professionals, or other persons acting “directly in the interests of an employer” all may be named in the petition and held personally liable for sexual harassment.

Employer response

With the passage of SB 45 and HB 21, an employee may bring a sexual harassment claim both for the harassing conduct itself or for an employer’s failure to take immediate corrective action. A defendant may now be held liable if an employee is harassed and the employer (or its agents, managers, or supervisors) knew or should have known the harassment was taking place, yet failed to take “immediate and appropriate corrective action.” Under the previous standard, employers needed only to take “prompt remedial action” when faced with an employee complaint.

While the legislature did not provide clear guidance on the differences between “immediate and appropriate corrective action” and “prompt remedial action,” courts are likely to hold employers to a higher response standard under the new laws.

Collateral implications

Opening the door to individual defendants may limit the number of harassment claims that can be removed to federal court, as the combination of individual plaintiffs and defendants is more likely to preclude diversity jurisdiction than the combination of individual plaintiffs and corporate defendants. Given the perception that state courts are sometimes less likely to grant summary judgment motions, the new law may have the additional effect of increasing settlement values in harassment cases as employers look to avoid lengthy discovery or trials.

Looking forward

The new laws are not retroactive, meaning they only apply to behavior alleged to have occurred on or after September 1, 2021. Texas employers should review and update their employee handbooks and sexual harassment policies, and smaller, previously-exempt employers should consider developing more formal policies and trainings. Employers of all sizes would be well-advised to provide refresher training on reporting sexual harassment, as well training on responding to such reports.