COURT FAVORS WORKERS IN HARASSMENT RULINGS.

Byline: Aaron Epstein Knight Ridder Newspapers

Ending its term with a rousing victory for women in the workplace, the Supreme Court told the nation's employers Friday that they can be held legally responsible for supervisors' sexual misconduct even if they knew nothing about it.

In a pair of milestone 7-2 rulings on sexual harassment, the court said employers are always liable when a supervisor's abuse results in a tangible job injury to the victim, such as firing, demotion or transfer to an undesirable job.

At the same time, however, the justices said that if the workers suffer no adverse job consequences, employers can escape liability if they have set up effective anti-harassment policies and can show that the complaining employee failed to use them.

The court issued its new guidelines in settling disputes arising from supervisors' harassment of one woman on a Florida beach and of another in the Chicago office of a large corporation. Neither was punished for refusing a superior's advances.

Taken together, the court's guidelines will be required reading in the nation's workplaces, where reported incidents of sexual misconduct are on the rise.

Sexual harassment complaints to the U.S. Equal Employment Opportunity Commission surged to 15,900 last year - an increase of 131 percent since 1991, the year Congress first allowed compensatory and punitive damages for such harassment under Title VII of the Civil Rights Act of 1964.

In the cases decided Friday, the court rejected arguments from employer organizations that they should be responsible only for their own negligence, not for harassment by supervisors of which they were unaware.

The two Supreme Court decisions, written by Justices David Souter and Anthony Kennedy, sought to rescue lower-court judges from a morass of confusion and discord.

The inability of the lower courts to forge a consensus on employer liability became starkly evident last year when all 12 judges on the Chicago-based federal appeals court openly pleaded for the Supreme Court to bring order to the ``chaotic case law.''

Out of the chaos came these new Supreme Court rules:

An employer may be held liable to a victimized employee for a sexually hostile environment created by the employee's supervisor.

If the harassment culminates in a ``tangible employment action'' - such as firing or demoting the employee or transferring her to an undesirable job - the employer has no defense.

If no such action is taken, the employer has a two-step defense. It consists of showing first that the employer ``exercised reasonable care to prevent and correct promptly any sexually harassing behavior,'' and second that the employee ``unreasonably failed to take advantage of any preventive or corrective opportunities provided by the employer.''

A few lawyers said the cases might help Paula Jones' appeal from the dismissal of her sexual harassment lawsuit against President Clinton because, in each case, the allegedly harassed woman suffered no adverse job consequences.

But many other lawyers cited significant differences between the two cases. The Jones vs. Clinton case involved only one alleged incident, did not result in any detrimental job consequences for Jones and, in the view of the judge who dismissed the case, did not appear to involve a job threat by Clinton.