In the

United States Court of Appeals

For the Seventh Circuit

No. 99-1155

Equal Employment Opportunity Commission,

Plaintiff-Appellee,

v.

Indiana Bell Telephone Co., Inc., d/b/a

Ameritech Indiana, and Ameritech Corp.,

Defendants-Appellants.

Appeal from the United States District Court 

for the Southern District of Indiana,

Indianapolis Division.

No. IP-95-217-C M/S--Larry J. McKinney, Judge.

Argued November 12, 1999--Decided May 26, 2000

 Before Flaum, Ripple, and Rovner, Circuit

Judges. 

 Flaum, Circuit Judge. The defendants,

Indiana Bell Telephone Co., doing

business as Ameritech Indiana, and

Ameritech Corp. (collectively referred to

as "Ameritech") appeal the judgment

entered against them following a jury

trial in the United States District Court

for the Southern District of Indiana. The

defendants contend that the evidence

presented at trial was insufficient to

support the jury’s verdict. In addition,

the defendants allege various errors by

the district court concerning the

admission of evidence and the jury

instructions. For the reasons stated

below, we reverse and remand this case to

the district court for further

proceedings consistent with this opinion.

I. Facts

A.

 This appeal arises out of a suit brought

by the Equal Employment Opportunity

Commission ("EEOC" or "Commission") on

behalf of the claimants alleging that

Ameritech engaged in unlawful employment

discrimination in violation of Title VII
of the Civil Rights Act of 1964, 42

U.S.C. sec. 2000e et seq. The sexual

harassment claims upon which the EEOC’s

suit is based stem from a course of

sexually offensive conduct that former

Ameritech employee Gary Amos directed at

several of his female co-workers.

Although only those incidents that

occurred after November 21, 1991 can

serve as a basis for holding Ameritech

liable for Amos’s actions, all of the

incidents are relevant to Ameritech’s

knowledge of Amos’s propensity to harass

women and to the reasonableness of

Ameritech’s response./1 As such, it is

necessary to recount the entire series of

incidents constituting Amos’s allegedly

offensive conduct.

 In 1975, Amos was employed in

Ameritech’s coin center with Barbara

Huckeba. At trial, Huckeba testified that

Amos exposed himself to her on three

separate occasions. Huckeba also stated

that she reported these incidents to her

supervisor. Ameritech discharged Huckeba

on October 24, 1975, citing her problems

with Amos and its belief that Huckeba, as

a white female, could more readily find

another job than Amos, a black male. All

of the complaints surrounding Huckeba’s

encounters with Amos were expunged from

Amos’s employment record, but two

complaints about Amos’s behavior during

1975 were not expunged. These complaints

indicate that Amos brushed one coworker’s buttocks as she bent over, and

that Amos partially exposed his penis to

another co-worker.

 In February 1988, Amos engaged in

conduct that Jacquelyn Stine, a co-worker

with whom he was training to be a

customer service representative, found

offensive. Stine testified that this

conduct included telling Stine he was in

love with her, smelling Stine’s hair and

telling her it was beautiful, and running

a strand of Stine’s hair through his

mouth. During Stine’s last encounter with

Amos, Amos pushed himself against Stine

as she stood at a vending machine and

Stine noticed that Amos had an erection.

As a result of these problems with Amos,

Stine left the customer service training

program and returned to her previous job

as an operator. A copy of Stine’s

complaint against Amos was placed in his

file, but Ameritech did not discipline

Amos at this time.
 An Ameritech report indicates that on

July 18, 1989, Amos continued his

offensive conduct by partially exposing

his penis to a co-worker while seated in

the back of a van. Janie Kern, the coworker involved in this incident,

reported Amos’s conduct to Ameritech. At

this point, Ameritech warned Amos that he

would be disciplined if he were found at

fault in any future allegations of sexual

harassment.

 In 1990, six female Ameritech employees

formally complained to Ameritech about

Amos’s conduct in the small business

office where he worked. Of these six

women, five indicated that Amos had

rubbed his penis against them. Ameritech

investigated these complaints and

suspended Amos for two weeks. In

addition, Ameritech stripped Amos of a

sales award and informed him that he

faced termination for any such future

incidents. At the time the decision to

suspend Amos was made, Ameritech did not

review Amos’s personnel files, nor were

any of the supervisors involved in the

decision aware of Amos’s past history of

misconduct.

 Despite the two-week suspension, Amos

continued his harassing behavior. In

early 1991, Debbie Murray, one of Amos’s

co-workers in the small business office,

asked to move to a different desk because

Amos was making improper comments. These

comments included inviting Murray over to

his house and asking her whether she ate

breakfast alone. That same year,

Ameritech received an anonymous letter

claiming that Amos was still sexually

harassing women in the workplace. In the

investigation that followed, at least

three women confirmed that Amos was still

engaging in sexually harassing conduct.

 In February 1992, Jennifer Rice, another

employee in Ameritech’s small business

office, complained about Amos’s conduct.

Rice stated that Amos rubbed himself

against her, rubbed her neck, and made

inappropriate comments about her body. In

response to Rice’s complaint, Brian

Bauer, the direct supervisor of both Amos

and Rice, and Darlene Olberding, who was

in charge of the managers in the small

business office, met with Amos. Amos was

informed that he could not have any

physical contact with anyone in the
office, and that further misconduct could

result in his suspension or termination.

Amos expressed interest in moving out of

the small business office, but Bauer told

him that a transfer would not be the

answer.

 One of the claimants in this case,

Debbie Wentland, was also employed in the

small business office and was seated in a

four-person cubicle directly across the

aisle from Amos’s cubicle. Initially,

Amos and Wentland engaged in only

innocuous conversations, but during one

encounter Amos walked behind Wentland’s

chair and placed his hands on her

shoulders. Wentland also testified that

Amos rubbed and touched his crotch area

on a daily basis. At various times, Amos

would approach Wentland and touch her,

including standing close enough to her

desk that their legs touched and rubbing

his hand up and down her back. Wentland

asked Amos to stop touching her. She

complained to Bauer in November 1992

after an incident in which Amos patted

her stomach and said "Oh, so you are

going to be a mom," and then followed her

to her desk where he continued to talk to

her while rubbing his erect penis through

his pants.

 Bauer met with Wentland on November 25,

1992 and informed her that he would

forward her complaint to Monica Sharp,

Ameritech’s Equal Employment Opportunity

("EEO") Coordinator. Sharp first met with

Wentland to discuss Amos’s conduct, and

then met with Amos on two occasions.

Sharp informed Amos that he had violated

the previous warning not to touch anyone

in the office. On December 18, 1992,

Sharp recommended that Amos be terminated

based on her conclusion that Amos "d[id

not] seem able to control himself at

Indiana Bell." After forwarding this

recommendation to Ameritech’s legal

department, Sharp went on vacation.

 On December 28, 1992, Labor Relations

manager Joyce Leck returned from vacation

and, after reviewing Sharp’s

recommendation that Amos be terminated,

noticed that the thirty-day period for

disciplinary action provided for in the

collective bargaining agreement had

expired. Because Ameritech missed the

deadline for disciplining Amos, the

company did not take any action against

him. However, Sharp did meet with Leck
and an official from Ameritech’s legal

department. They agreed that the next

complaint against Amos would result in an

immediate suspension pending

investigation in order to avoid missing

any deadlines./2 Amos was then informed

that he was not being disciplined because

of an administrative error, but that any

further misconduct could result in his

suspension or termination.

 In January 1993, Sharp began an

investigation to determine whether Amos

was continuing to harass Wentland or any

of the other service representatives.

While Wentland stated that Amos had not

harassed her again, she did recommend

that Sharp speak to Lori Everts or

Patricia Black. Everts, a chief union

steward and a claimant in this case,

refused to talk to Sharp because she

regarded it as a conflict of interest to

assist the company in investigating a

member of the union. After an

unproductive meeting with Black, during

which a union steward continually

interrupted the interview, Sharp became

angry at what she regarded as union

interference with the investigation.

Sharp informed Leck, Ameritech’s Labor

Relations manager, of her concerns. Leck

then informed the union president that

the company intended to hold the union

liable if it were sued as a result of

Amos’s conduct.

 On April 15, 1993, Everts filed a charge

with the EEOC based on Amos’s conduct. In

her charge, Everts stated that Amos

walked around the office with his hands

in his pockets fondling his genitalia.

Everts also testified that Amos began

directing his behavior toward her in

February 1993 by brushing up against her

with his penis erect. Everts stated that

at different times Amos brushed his hand

over her buttocks, grabbed her waist, and

stared at her and stuck out his tongue.

Despite the filing of the EEOC charge

Amos’s misconduct continued, including

tapping his fingers on Everts’s back,

placing his hand on her back as she

walked down the hall, and yelling out to

her that her legs looked nice.

 When Ameritech received notice of

Everts’s EEOC complaint, it acted

according to established company

procedures for handling external

complaints and referred the matter to
Ameritech’s legal department. Ameritech

did not investigate the complaint, but

rather cooperated with the EEOC

investigation. Because Everts had refused

to cooperate in Sharp’s investigation,

Leck believed that the complaint was in

response to the company’s threat to hold

the union liable. An attorney in

Ameritech’s legal department ultimately

concluded that Everts’s charge had no

merit. Amos was not disciplined as a

result of the Everts complaint.

 In June 1993, Patricia Wolter, a

supervisor in the small business office,

found a note on her desk that read:

"Patti, you look so sexy today." Wolter

was upset by the note, and she asked Amos

if he was the author. Amos admitted

having written the note, but he claimed

that it was just a joke. Wolter reported

the incident to Carol Merriwether, who

was serving as EEO Coordinator while

Sharp was out of the office. As a result

of this incident, Ameritech suspended

Amos for thirty days.

 Wendy Pollard, the third claimant in

this case, began working with Amos in the

small business office in November 1993.

After approximately one month in the

office, Amos began touching and grabbing

Pollard’s hair and shoulders when he

passed. Amos also frequently stared at

Pollard while she was working, often with

his belt unbuckled. One afternoon, after

overhearing a conversation about

Pollard’s new jeans, Amos stood up,

stared at Pollard’s crotch, and said

"Wendy, I think you are right, those

jeans are a little too tight." In other

incidents, Amos told Pollard that he

would try to stop touching her hair but

that he was obsessed, and brought in

pictures of topless women and women in

lingerie to show Pollard and another

female co-worker.

 The final incident during Amos’s tenure

at Ameritech occurred on March 7, 1994.

While Pollard was moving her belongings,

she looked over the partition next to her

new desk and saw Amos sitting in a chair

masturbating. Pollard reported the

incident to Ameritech’s EEO Coordinator.

Ameritech suspended Amos pending

investigation and it terminated his

employment later that month. 

B.
 On February 21, 1995, the EEOC filed a

complaint in federal district court

against Ameritech. The Commission alleged

that Ameritech violated Title VII of the

Civil Rights Act of 1964, 42 U.S.C. sec.

2000e et seq., by subjecting Everts and

other similarly situated females to

sexual harassment. The EEOC sought both

compensatory and punitive damages. 

 Before the trial on the sexual

harassment claims against Ameritech

began, the district court considered

whether to allow Ameritech to present

evidence at trial related to its

collective bargaining agreement with

Amos’s union. Ameritech wanted to present

evidence that its decision regarding the

timing of Amos’s discharge was influenced

by management’s concern that if Amos were

discharged in violation of the "just

cause" provision of the collective

bargaining agreement, Amos would have

filed a union grievance, prevailed on

that grievance, and been reinstated by an

arbitrator. 

 After hearing argument on the issue, the

district court excluded testimony

relating to Ameritech’s concern that Amos

might be reinstated under the "just

cause" standard. As the court read the

relevant law, Title VII required

Ameritech to "act adequately and

reasonably to end the harassment." The

district court found that

Ameritech’scollective bargaining

agreement, or its fears that an

arbitrator might reinstate Amos, were not

relevant in determining the

reasonableness of Ameritech’s actions

under Title VII. 

 The district court reaffirmed its

evidentiary ruling as to the collective

bargaining agreement and the arbitration

evidence in a written order dated

September 15, 1997. In that order, the

court stated that "any concerns by an em

ployer that an arbitrator might undo the

discipline it has meted out for

misconduct does not excuse taking no, or

very little, action when [Title VII]

requires them [sic] to act promptly to

halt any violations of its provisions."

The court also noted its fear that if an

employer was entitled to delay taking

action against an employee because of the

risk of arbitration, employment
discrimination law would be subject to

"the vagaries of collective bargaining

and negotiated grievance and arbitration

procedures." 

 During the course of trial, Ameritech

moved for judgment as a matter of law as

to punitive damages. Ameritech argued

that the EEOC had presented no evidence

that would support an award of such

damages. The district court denied

Ameritech’s motion, and held that it

would instruct the jury on punitive

damages. The court’s decision with regard

to this instruction was based on the

understanding that punitive damages are

available if "an employer exhibits a

consistent attitude of indifference to

the protected rights of the claimant in

the face of evidence indicating that

corrective action that has already been

taken has not stopped the harassment."

The court further stated that the EEOC

would have to establish Ameritech’s

reckless indifference to the claimants’

Title VII rights by clear and convincing

evidence.

 Near the close of trial, and again at

the end of trial, Ameritech renewed its

motion for judgment as a matter of law.

Ameritech argued that the evidence

presented by the EEOC did not establish a

hostile working environment or liability

on the part of Ameritech, and further

contended that the evidence failed to

show damages in connection with Everts’s

claim. The district court denied both of

these motions and the case went to the

jury. 

 The jury returned a verdict for the EEOC

in the following amounts: $10,000 in

compensatory damages and $500,000 in

punitive damages on Wentland’s claim; $0

in compensatory damages and $50,000 in

punitive damages on Everts’s claim; and

$5,000 in compensatory damages and

$500,000 in punitive damages on Pollard’s

claim. Ameritech immediately moved for

judgment notwithstanding the verdict and

remittitur and the district court took

both of these motions under advisement.

 On October 3, 1997, the district court

entered judgment in favor of the

Commission. The court ordered that

damages be paid to the claimants in the

following amounts: $10,000 in

compensatory damages and $290,000 in
punitive damages to Wentland; $0 in

compensatory damages and $0 in punitive

damages to Everts; and $5,000 in

compensatory damages and $295,000 in

punitive damages to Pollard. The court

then denied a motion by the Commission to

amend the judgment, and denied

Ameritech’s motions for judgment

notwithstanding the verdict, new trial,

and remittitur beyond the reduction in

damages reflected in the court’s order.

Ameritech filed a notice of appeal with

this Court, and the Commission crossappealed. The two appeals were

consolidated for argument.

 On October 27, 1998, the district court

issued an order indicating it was

inclined to grant the Commission’s motion

to reconsider the issue of Everts’s

damages. The case was then remanded to

the district court for modification of

final judgment. Upon remand, the district

court reinstated the jury’s verdict

awarding $50,000 in punitive damages to

Everts. Ameritech now appeals from the

district court’s amended judgment of

December 22, 1998.

II. Analysis

A.

 We review the district court’s denial of

Ameritech’s motions for judgment as a

matter of law de novo. See Emmel v. CocaCola Bottling Co. of Chicago, 95 F.3d

627, 629 (7th Cir. 1996). Our review is

limited to "whether all evidence

presented, ’combined with all reasonable

inferences that may be drawn from it, is

sufficient to support the verdict when

viewed in the light most favorable to the

party winning the verdict.’" Hennessy v.

Penril Datacomm Networks, Inc., 69 F.3d

1344, 1354 (7th Cir. 1995) (quoting

Mathewson v. National Automatic Tool

Corp., 807 F.2d 87, 90 (7th Cir. 1986)).

As to punitive damages, we ask only if "a

reasonable jury could have awarded

punitive damages against [Ameritech]."

Tincher v. Wal-Mart Stores, Inc., 118

F.3d 1125, 1132 (7th Cir. 1997).

 Ameritech first contends that the

district court erred in denying its

motion for judgment as a matter of law as

to the issue of punitive damages because

the evidence presented at trial did not

support a punitive damages award.
Punitive damages "require more than . . .

’intentional unlawful discrimination.’"

Tincher, 118 F.3d at 1133 (quoting Emmel,

95 F.3d at 636). The EEOC must also

"prove that the defendant employer

engaged in the discriminatory practice

’with malice or reckless indifference to

the federally protected rights of the employee.’"

Emmel, 95 F.3d at 636 (quoting 42 U.S.C.

sec. 1981a(b)(1)). A showing of "malice

or reckless indifference" under 42 U.S.C.

sec. 1981a requires proof "that the

defendant almost certainly knew that what

he was doing was wrongful and subject to

punishment."/3 Soderbeck v. Burnett

County, Wis., 752 F.2d 285, 291 (7th Cir.

1985).

 In evaluating Ameritech’s insufficiency

of the evidence claim as to punitive

damages, we must consider the evidence in

light of the entire record to determine

whether a reasonable jury could have

determined that Ameritech acted with

"malice or reckless indifference" to the

claimants’ Title VII rights. See Emmel,

95 F.3d at 636. When examined against the

backdrop of Amos’s past history, it is

apparent that a reasonable jury could

have concluded that Ameritech acted with

"malice or reckless indifference." In

this regard, it is significant that by

November 21, 1991, Ameritech had

accumulated a history of complaints

against Amos going back to 1975.

Ameritech had received at least eleven

complaints against Amos indicating a

pattern and history of misconduct

directed at women. These complaints, and

Ameritech’s disciplinary actions in

response, indicate that as of November

21, 1991, Ameritech was on notice of

Amos’s recurring problems with female coworkers. See Jonasson v. Lutheran Child &

Fam. Serv., 115 F.3d 436, 439 (7th Cir.

1997) (stating that although incidents

prior to November 21, 1991 cannot serve

as a basis for employer liability, they

may be used to provide the jury a context

for evaluating the reasonableness of the

employer’s response). 

 Despite its knowledge of Amos’s

misconduct and the futility of its prior

disciplinary efforts, Ameritech continued

to allow Amos to work in the small

business office where ninety percent of

the employees were female. Even after the

company learned in February 1992 that

Amos had sexually harassed Jennifer Rice,
the company issued another warning to

Amos and refused his request to be

transferred out of the small business

office. Furthermore, after Wentland

complained to Ameritech about Amos’s

conduct and a subsequent investigation

found that Amos sexually harassed

Wentland, Ameritech did not discharge

Amos within the thirty-day limit for

disciplinary action imposed by the

collective bargaining agreement. In

addition, Ameritech concluded that

Everts’s EEOC charge had no merit and

thereby failed to act on it, and

repeatedly refused to discipline Amos on

other occasions. This Court has

previously held that the failure of an

employer to act to remedy an employee’s

misconduct, when coupled with the

employer’s knowledge of that conduct, can

be sufficient to justify an award of

punitive damages. See Jonasson, 115 F.3d

at 438. While the evidence in this case

may not compel the conclusion that

Ameritech acted with "malice or reckless

indifference" to the claimants’ Title VII

rights, it certainly provides a

sufficient basis for a reasonable jury to

find in favor of the Commission.

 In addition to its claims as to the

insufficiency of the evidence on punitive

damages, Ameritech also contends that the

evidence presented by the EEOC was

insufficient to support a conclusion that

Ameritech was negligent, or that the

claimants suffered a hostile work

environment. However, given our

conclusion that the record supports an

award of punitive damages against

Ameritech, we find the company’s

additional insufficiency of the evidence

arguments to lack merit. First, any

question as to the sufficiency of the

evidence on negligence, and consequently

as to Ameritech’s liability, see Perry v.

Harris Chernin, Inc., 126 F.3d 1010, 1013

(7th Cir. 1997) ("[E]mployers are liable

only when they have been negligent either

in discovering or remedying the

harassment."), is necessarily answered by

our discussion of punitive damages.

"Malice or reckless indifference"

establishes a higher standard than

negligence, so evidence supporting the

former supports the latter. Similarly, we

conclude that the evidence in this case

was sufficient to establish the existence

of a hostile work environment. All of the

claimants experienced various incidents
with Amos involving suggestive comments,

inappropriate touching, or indecent

exposure. Furthermore, all of the

claimants testified that they were

disturbed by this conduct. There is no

question that the evidence presented by

the EEOC was enough to establish a

hostile work environment from both an

objective and a subjective perspective,

see id., and that the evidence presented

was sufficient to justify an award of

both compensatory and punitive

damages./4 

B.

 With regard to Ameritech’s evidentiary

challenges, we review the rulings of the

district court for an abuse of

discretion. See Buckner v. Sam’s Club,

Inc., 75 F.3d 290, 292 (7th Cir. 1996).

"[T]he relevant inquiry is not how the

reviewing judges would have ruled if they

had been considering the case in the

first place, but rather whether any

reasonable person could agree with the

district court." Geitz v. Lindsey, 893

F.2d 148, 150 (7th Cir. 1990). If we

determine that the district court has

abused its discretion in making an

evidentiary ruling, we nonetheless affirm

the district court if the erroneous

ruling is determined to be harmless. See

Holmes v. Elgin, Joliet & E. Ry. Co., 18

F.3d 1393, 1397 (7th Cir. 1994).

 Ameritech challenges the district

court’s decision to exclude evidence

regarding Ameritech’s obligations under

its collective bargaining agreement and

the effect those obligations had on the

timing of Amos’s dismissal. The district

court held that such evidence was "not

relevant to a determination of the

reasonableness of an employer’s response

to sexual harassment in the workplace."

According to Ameritech, the district

court’s ruling in this regard was

erroneous as a matter of law. The

reasonableness of Ameritech’s response

should be determined according to whether

it was "’reasonably calculated to prevent

further harassment under the particular

facts and circumstances of the case at

the time the allegations were made.’"

McKenzie v. Illinois Dep’t of Trans., 92

F.3d 473, 480 (7th Cir. 1996) (quoting

Brooms v. Regal Tube Co., 881 F.2d 412,

421 (7th Cir. 1989)). Ameritech contends
that its obligations under its collective

bargaining agreement were part of the

facts and circumstances that informed

Ameritech’s judgment as to Amos’s

discipline, and as such they are relevant

to a jury’s determination of the

reasonableness of its response.

 Ameritech also argues that the exclusion

of the arbitration evidence was erroneous

in light of the punitive damages

instruction given to the jury, and the

large punitive damages awards that were

returned. As has been previously

discussed, in order to receive an award

of punitive damages the EEOC must show

that Ameritech acted with "malice or

reckless indifference" to the claimants’

Title VII rights. Emmel, 95 F.3d at 636.

According to Ameritech, it acted not out

of "malice or reckless indifference," but

rather out of concern for its obligations

under the collective bargaining agreement

and its fear that Amos would be

reinstated by an arbitrator if he were

fired. By excluding evidence of the

collective bargaining agreement and the

possibility of reinstatement, the

district court precluded Ameritech from

presenting what Ameritech contends was

important evidence that would go toward

proving it did not act with the state of

mind necessary for the imposition of

punitive damages. 

 In evaluating the district court’s

decision excluding evidence of the

collective bargaining agreement and the

potential outcome of arbitration

proceedings, we must first determine what

the district court meant when it stated

that the evidence in question was

irrelevant. As we understand it, the

district court was not considering the

question as a matter of logical

relevance; the district court did not

mean that this evidence was not useful in

assessing the probability that Ameritech

acted with "malice or reckless

indifference." Fed.R.Civ.P. 401. Nor did

the district court indicate that "the

probative value [of the evidence was]

substantially outweighed" by other

considerations. Fed.R.Civ.P. 403. Rather,

the district court stated that "an

employer is subjected to separate duties

under a positive law, such as Title VII,

and under a [collective bargaining

agreement]," and when those duties

conflict "the positive law controls." In
essence, the district court held that as

a matter of law, Ameritech’s obligations

under the collective bargaining agreement

and its fears as to the possible outcome

of arbitration could not be introduced in

the face of conflicting duties under

Title VII.

 To the extent the district court’s

ruling reflects the idea that Title VII

always trumps the provisions of a

collective bargaining agreement, that

ruling is erroneous as a matter of law.

While it is true that employers cannot

use collective bargaining agreements to

contract around anti-discrimination laws

like Title VII, see Trans World Airlines,

Inc. v. Hardison, 432 U.S. 63, 79 (1977)

("[A] collective-bargaining contract . .

. may [not] be employed to violate the

statute."), that principle is not

applicable to this case. The EEOC does

not allege that Ameritech negotiated for

the thirty-day limit on disciplinary

action in order to avoid Title VII

obligations, nor is there any evidence in

the record to that effect. Furthermore,

this is not a situation where Ameritech

is seeking to use its obligations under

the collective bargaining agreement as an

affirmative defense precluding liability

under Title VII./5 Rather, Ameritech

seeks only to introduce evidence as to

its collective bargaining agreement, and

its concern over the possible outcome of

arbitration, to demonstrate that it did

not act with the state of mind necessary

for an award of punitive damages and to

show that its response to Amos’s

misconduct was reasonable. See Deneen v.

Northwest Airlines, Inc., 132 F.3d 431

(8th Cir. 1998) (holding that proof of

discrimination offered by the plaintiff

was insufficient to support a punitive

damages award in light of the employer’s

belief that its actions were required by

a collective bargaining agreement). In

this context, the district court erred in

finding that evidence of Ameritech’s

collective bargaining agreement was

irrelevant as a matter of law. 

 The relationship between an employer’s

obligations under its collective

bargaining agreement and potentially

conflicting obligations under an antidiscrimination statute like Title VII is

more complex than the district court’s

decision indicates. Title VII and

collective bargaining agreements/6 each
represent important congressional

policies: preventing discrimination in

the workplace, and "effecting workable

and enforceable agreements between

management and labor," Trans World

Airlines, 432 U.S. at 79. Given the

important national policies underlying

both Title VII and collective bargaining

agreements, it is incorrect to hold, as

the district court did, that obligations

under Title VII always trump obligations

that exist under valid labor agreements.

See id. (holding that an agreed-upon

seniority system did not "give way" to an

employer’s duty to "reasonably

accommodate" religious observance under

Title VII); Eckles v. Consolidated Rail

Corp., 94 F.3d 1041, 1051 (7th Cir. 1996)

(holding that a collectively-bargained

seniority system was not trumped by the

duty to "reasonably accommodate" the

disabled under the Americans With

Disabilities Act). Because the district

court based its decision to exclude the

disputed evidence on an error of law,

that decision constitutes an abuse of

discretion./7 See Waid v. Merrill Area

Pub. Sch., 130 F.3d 1268, 1273 (7th Cir.

1997).

 While the EEOC concedes that the

district court may have been mistaken

about the legal relationship between

collective bargaining agreements and

Title VII, it contends that any such

mistake was harmless. We disagree.

Although the EEOC correctly points out

that Ameritech was able to present

evidence as to the thirty-day limit on

disciplinary action under the collective

bargaining agreement, Ameritech employees

were prevented from testifying about the

facts and circumstances surrounding the

timing of their decision to terminate

Amos. Ameritech was also precluded from

presenting evidence that it failed to

discharge Amos after the Wentland

incident because of concerns about

violating the collective bargaining

agreement. Furthermore, Ameritech could

not present evidence as to the

likelyoutcome of arbitration, and its

decisionmakers’ fears that Amos would be

reinstated were he to be discharged in

violation of the collective bargaining

agreement. As we have previously noted,

this was potentially significant evidence

as to Ameritech’s state of mind and to

the reasonableness of Ameritech’s

actions, and we cannot say that the
outcome of the trial would have been the

same had the jury been permitted to hear

this evidence. See United States v.

Stefonek, 179 F.3d 1030, 1036 (7th Cir.

1999) ("A ’harmless error’ as the term is

used in law is a trial error that does

not alter the trial’s outcome."); Collins

v. Kibort, 143 F.3d 331, 339 (7th Cir.

1998) (stating that an error is not

harmless when "a significant chance

exists" that the error "affected the out

come of the trial").

 Our conclusion that this evidence was

not harmless is bolstered by the nature

of the jury verdict in this case. In the

case of all three claimants, the punitive

damages awards rendered by the jury far

surpassed the awards given for

compensatory relief. When punitive

damages are such an important part of a

jury award, the defendant’s state of mind

is a central issue. See Kolstad v.

American Dental Ass’n, 119 S.Ct. 2118,

2125-26 (1999) ("Most often . . .

eligibility for punitive awards is

characterized in terms of a defendant’s

motive or intent."); Ortiz v. John O.

Butler Co., 94 F.3d 1121, 1127 (7th Cir.

1996) (stating that the "requisite

showing for punitive damages necessarily

focuses upon the defendant’s state of

mind"). By precluding the disputed

evidence, the district court deprived

Ameritech of potentially valuable

evidence that would have allowed it to

counter the jury’s impression that it

acted negligently or with "malice or

reckless indifference" to the claimants’

Title VII rights. The sheer size of the

jury’s verdict in this case, when viewed

in relation to the amount of compensatory

damages awarded, supports our conclusion

that the district court’s erroneous

preclusion of the arbitration evidence

was not harmless.

III. Conclusion

 Because we have determined that the

evidence was sufficient to support the

jury’s verdict, we decline to enter

judgment on behalf of Ameritech. However,

in light of our ruling that the district

court erred in excluding evidence of

Ameritech’s collective bargaining

agreement and its concern about the

outcome of arbitration, we REVERSE the

judgment of the district court and REMAND

this case for further proceedings
consistent with this opinion.

/1 Both parties agree that November 21, 1991 is

the relevant date for purposes of determining

Ameritech’s liability for punitive damages because that is the date on which 42 U.S.C. sec.

1981a was enacted. That statute, which provides

for punitive damages under Title VII, is not

retroactive. See Landgraf v. USI Film Prod., 511

U.S. 244, 281 (1994). Similarly, the district

court correctly determined that compensatory

damages could not be awarded based on emotional

distress for conduct before November 21, 1991.

Recovery of compensatory damages was added by 42

U.S.C. sec. 1981a, and that provision is nonretroactive as well. Landgraf, 511 U.S. at 281-

83.

/2 Under the terms of the collective bargaining

agreement, Ameritech could have terminated Amos

outside the thirty-day window for disciplinary

action if it had suspended Amos before the thirty-day limit expired.

/3 The district court properly instructed the jury

that in order to hold Ameritech liable for punitive damages, it would have to find that in

dealing with Amos after November 21, 1991 Ameritech: (1) was motivated by malice ("ill will, or

spite, or grudge") toward Wentland, Pollard, and

Everts, or toward female employees as a class; or

(2) acted with both "a high degree of awareness

that its conduct would violate Title VII" and

"consistent disregard for such a violation."

/4 Ameritech also contends that the punitive damages

awards in this case were clearly excessive. In

support of this contention, Ameritech points out

that two of the punitive damages awards, $290,000

to Wentland and $295,000 to Pollard, were near

the statutory maximum of $300,000 established by

42 U.S.C. sec. 1981a (b)(3)(D). According to

Ameritech, Hennessey v. Penril Datacomm Networks,

Inc., 69 F.3d 1344 (7th Cir. 1995), held that

awards at or near the statutory maximum should be

reserved for the most egregious of cases, and

that this is not an appropriate case for such a

large award. 

 We believe Ameritech has misread our holding in

Hennessey, which reduced an award at the statutory maximum. Id. at 1355-56. Although Hennessey

provides support for the idea that punitive

damages awards can be excessive, and that awards

at or near the statutory maximum should be reserved for egregious cases, the Court in that

case limited the decision to its facts and did

not purport to establish a per se rule about the

availability of punitive damages at or near the
statutory maximum. It is well-recognized that the

amount of damages is largely within the province

of the jury, and that its determination should

not generally be disturbed. See EEOC v. AIC

Security Investigations, Ltd., 55 F.3d 1276, 1287

(7th Cir. 1995) ("[T]he primary responsibility

for deciding the appropriate amounts of [punitive] damages rests with the jury."). Here, a

jury could well have determined that Ameritech’s

conduct was egregious and warranted a large

punitive damages award, and the district court’s

award of punitive damages at or near the statutory maximum was not in error.

/5 In response to the dissent, we want to emphasize

that our opinion should not be read to imply that

Ameritech, or any employer, can use a provision

in its collective bargaining agreement to shield

itself from liability under Title VII. An employer has a clear responsibility under Title VII to

act reasonably to end sexual harassment and to

protect its employees from harassing behavior,

see Brooms v. Regal Tube Co., 881 F.2d 412, 421

(7th Cir. 1989) (recognizing "that an employer is

liable for an employee’s action if the employer

knew or should have known about an employee’s

acts of harassment and fails to take appropriate

remedial action"), and Ameritech’s obligations in

that regard remain unchanged. However, Ameritech-

’s obligation to end sexual harassment, and

consequently its vicarious liability for the

actions of non-supervisory employees, is not

absolute. See Meritor Savings Bank, FSB v. Vinson, 477 U.S. 57, 72 (1986) (stating that there

are "some limits on the acts of employees for

which employers under Title VII are to be held

responsible"); Juarez v. Ameritech Mobile Comm.,

Inc., 957 F.2d 317, 320 (7th Cir. 1992) ("Employers are not strictly liable under Title VII for

sexual harassment engaged in by their employees."). Under Title VII, employers are liable for

compensatory damages only upon a showing of

negligence, see Baskerville v. Culligan Int’l

Co., 50 F.3d 428, 432 (7th Cir. 1995) ("[T]he

criterion for when an employer is liable for

sexual harassment is negligence."), and liability

for punitive damages is limited to situations

where an employer acts with "malice or reckless

indifference," 42 U.S.C. sec. 1981a(b)(1). By

focusing on an employer’s duty to remedy sexual

harassment under Title VII, and not on the issue

of Ameritech’s state of mind, we respectfully

suggest that both the district court and the

dissent misapprehend the purpose for which Ameritech sought to introduce the disputed evidence.

 In order to counter the plaintiffs’ allegation

that it acted negligently or with "malice or

reckless indifference" when it failed to terminate Amos following the Wentland incident, Ameri-
tech should have been allowed to present evidence

as to its asserted justification for acting (or

failing to act) in the way that it did. Only

after hearing this evidence could the jury properly evaluate Ameritech’s state of mind and the

reasonableness of its response. Our holding in

this regard does not elevate Ameritech’s obliga

tions under the collective bargaining agreement,

or its fears about the possible outcome of arbitration, into a defense to Title VII liability.

Having heard this evidence, a jury could conclude

that Ameritech should have discharged Amos after

the Wentland incident regardless of whether that

action would have violated the collective bargaining agreement. In this case, however, the

jury did not have the opportunity to consider

Ameritech’s asserted justification for its actions because the district court erroneously

determined that Ameritech’s obligations under its

collective bargaining agreement were irrelevant

to its responsibilities under Title VII. We

reverse and remand this case not, as the dissent

characterizes our opinion, because the district

court precluded Ameritech from offering evidence

of its collective bargaining agreement as a

defense to Title VII liability, but rather only

because the district court erroneously prevented

Ameritech from offering relevant evidence regarding its state of mind and the reasonableness of

its response to Amos’s harassing acts.

/6 The congressional policies underlying collective

bargaining agreements are embodied in the National Labor Relations Act, 29 U.S.C. sec. 151 et

seq.

/7 The EEOC concedes that the district court’s

statement of the law may be incorrect, but argues

that this mistake of law did not serve as the

basis of the district court’s opinion. Rather,

the EEOC asserts that the district court engaged

in a Rule 403 analysis and concluded on the facts

of this case that Ameritech’s concern about

violating its collective bargaining agreement was

so speculative as to render it irrelevant for

purposes of determining the appropriate response

to Amos’s behavior. We do not read the district

court’s opinion in this manner. The district

court indicated numerous times that it regarded

the disputed evidence to be inadmissible as a

matter of law, and we find no support for recharacterizing the court’s decision as a discretionary one. 

 ROVNER, Circuit Judge, concurring in part and

dissenting in part. Nearly two decades after it

fired the first woman to complain of Gary Amos’

harassment, Ameritech at last did what it should
have done years before--it fired him. By that

time, Amos had sexually harassed at least

eighteen of Ameritech’s female employees,

variously touching the women, exposing himself to

them, peppering them with suggestive remarks,

masturbating in their presence, and rubbing his

erect penis against their bodies. Long after it

was clear to the company that it had a serial

harasser in its employ, Ameritech botched any

number of opportunities to deal with his

misconduct decisively. It warned and suspended

Amos without effect; it promised harsher

sanctions in the future but did not follow

through; when it finally resolved to fire Amos in

1992, it inexcusably missed the thirty-day

deadline imposed by the collective bargaining

agreement; and even after that fumble, Ameritech

waited for three more women to complain of

harassment before it ultimately terminated Amos.

The evidence was thus more than sufficient to

support the jury’s conclusion that Ameritech’s

response to the harassment was not only

negligent, but indicative of a reckless

indifference to the rights of the women in its

employ, such that punitive damages were

appropriate. With that much of the majority

opinion, I wholeheartedly concur.

 I do not agree, however, that the district

judge abused his discretion in excluding evidence

of Ameritech’s professed concern for the outcome

of arbitration that might have ensued had the

company fired Amos sooner than it did. The

arbitration defense posits a conflict between the

obligation that Title VII imposes on an employer

to protect its workers from sexual harassment and

certain provisions of the collective bargaining

agreement between Ameritech and its unionized

workforce. More specifically, the defense assumes

that an arbitrator interpreting the agreement

might not agree with--and might well undo--

disciplinary action that Ameritech has taken in

fulfillment of its statutory obligation to

address workplace harassment. Proof along that

line, Ameritech posits, would have shown the jury

why its decision not to discharge Amos in

December 1992 and again in June 1993 was

reasonable: not wishing to see an arbitrator

reinstate Amos, it was simply biding its time

until it could fire Amos under circumstances that

an arbitrator would agree warranted his

discharge. What Ameritech wants, then, is for the

jury to evaluate the company’s conduct not solely

in terms of what was reasonably necessary to stop

the harassment that Amos was inflicting on his

co-workers, but also in terms of what the

collective bargaining agreement and an arbitrator

might have permitted.

 I believe my colleagues are mistaken in opening
the door to this defense. Title VII imposes an

unequivocal duty on employers to take reasonable

measures to stop harassment. Never before today

have we held that the provisions of a collective

bargaining agreement--or, more accurately,

concerns about how an arbitrator might interpret

them--can modify this obligation. What Ameritech

has won is the right to invoke the collective

bargaining agreement as an excuse for sitting on

its hands while Amos kept on terrorizing his

female colleagues. In fact, however, nothing in

the collective bargaining agreement forced

Ameritech to forego discharging Amos. And to the

extent that an employer’s duties under Title VII

and a collective bargaining agreement may

conflict, its obligation to protect its workers

from harassers should take precedence, as Judge

McKinney held. To permit the jury to let an

employer off the hook because of its professed

concerns about how an arbitrator might interpret

the collective bargaining agreement in effect

holds unionized employers to a lesser standard of

care in eliminating workplace harassment.

1. 

 What one must appreciate at the outset is that

Ameritech’s liability in this case hinges not on

its failure to act on any one occasion in

particular, but on its pattern of inaction in the

face of Amos’ unrelenting misconduct. Consider

what the company knew when the amended version of

Title VII took effect in November of 1991. By

that time, Amos had harassed at least thirteen

women at Ameritech. His acts already had run the

entire gamut of harassment, from inappropriate

remarks to intimate and unwelcome touching.

Indeed, by my count, Amos had already exposed

himself at least five times by then and had

rubbed his erect penis against startled coworkers on at least as many occasions. Nothing

that Amos did after 1991, then, could have come

as a surprise to Ameritech. The company had

already disciplined Amos on several occasions and

had twice threatened to fire him if he persisted

in the harassment. See Tr. 193, 570. It also

knew, as of 1991, that the discipline and

warnings had proven ineffective; for in

investigating the complaints of Debbie Murray and

an anonymous co-worker that year, Ameritech

learned that Amos was continuing to engage in

sexual misconduct. Tr. 584-93, 811-18.

 With this history in mind, one would think that

Ameritech, if genuinely concerned about the

welfare of its female employees, would have taken

more aggressive action in response to the acts of

harassment that occurred after the Civil Rights

Act of 1991 took effect. Instead, the company

bungled opportunity after opportunity to take
decisive action against Amos. In early 1992,

after Jennifer Rice complained of inappropriate

remarks and physical contact, the company simply

told Amos that he was not to touch anyone in the

office and warned him--again--that further

misconduct might result in suspension or

termination. Tr. 596-97. It did not fire him, it

did not suspend him, it did not dock his pay, it

did not, in fact, take any punitive action

against him. It even rejected Amos’ own

suggestion that he be transferred out of the

small business office (Tr. 1096-97), where

ninety-five percent of his co-workers were women

(see Tr. 177, 408, 843). Later that year, Amos

touched Debbie Wentland inappropriately--thereby

violating his supervisor’s admonition not to have

physical contact with his co-workers--and rubbed

his erect penis through his pants while talking

to her. The company’s EEO coordinator recommended

his discharge for this conduct (Tr. 776-77, 847),

but her recommendation sat unread on the labor

relations manager’s desk until after the thirtyday period for discipline specified by the

collective bargaining agreement had already

expired (Tr. 644). The company at that point

concluded it could take no action against Amos.

 Having muffed the decision to fire Amos in

1992, Ameritech should have been fully prepared

to take swift and decisive action when the next

incident of misconduct occurred. See Tr. 255,

648, 829-30, 1193. Yet, even after Lori Everts

filed an E.E.O.C. charge in 1993 because Amos had

touched her inappropriately, fondled his

genitalia through his clothing in front of her,

and brushed up against her while aroused--all

things he had done before to other women--the

company did not so much as investigate her

complaint. See Tr. 930-31, 941, 944-45, 1141.

When Amos wrote the "you look so sexy today" note

to supervisor Patricia Wolter in June 1993,

Ameritech opted simply to suspend him, a measure

that had already proven ineffective. See Tr. 406.

This freed Amos to harass Wendy Pollard, who

began to work with him in November 1993. After

months of touching her hair, staring at her with

his belt unbuckled, telling her that he was

obsessed with her, displaying photos of lingerieclad and topless women to her, Amos finally drove

Pollard to the EEO coordinator when she

discovered him sitting at his desk, with his

penis exposed and erect, masturbating. Finally,

the company got it right--it suspended him

immediately pending investigation and ultimately

terminated him.

 Ameritech thus allowed the equivalent of an

armed torpedo to wander about the workplace for

years wreaking havoc upon its female employees.

At least eighteen women--that we know of--fell
victim to Amos’ harassment. To focus upon

Ameritech’s failure to act in any single

instance--as its arbitration defense invites us

to do--is to miss the larger picture. By November

of 1991, Ameritech knew that it had an employee

who was prone to sexually harass his co-workers

in extremely offensive ways, and as to whom

repeated warnings and disciplinary measures had

proven utterly ineffective. Yet, the company

continued to respond to Amos’ misconduct with the

same day-late-and-a-dollar-short measures it had

tried before. Therefore, the first and most

important point with respect to Ameritech’s

liability is not that it failed to discharge Amos

in response to the Wentland and Wolter complaints

in particular, but that it missed those and so

many other chances to take action reasonably

calculated to stop his harassment--including not

only termination, but demotion, transfer,

intensive supervision, warnings to his

uninitiated co-workers, and any number of other

disciplinary and prophylactic measures.

2.

 As I noted at the outset, Ameritech’s

arbitration defense presupposes some degree of

tension between the collective bargaining

agreement and Title VII. In December of 1992, the

asserted conflict arose from the collective

bargaining agreement’s thirty-day limit on

disciplinary action: by the time Ameritech was

prepared to fire Amos in response to Wentland’s

complaint, thirty days had already passed. If it

had gone ahead and fired him after that point,

Ameritech posits, an arbitrator might well have

declared the discharge invalid and reinstated

him. The first and most glaring problem with this

line of defense is that the purported clash was

one wholly of Ameritech’s making.

 Only Ameritech is to blame for the failure to

discharge Amos in a timely fashion. The

collective bargaining agreement gave Ameritech

thirty days within which to impose discipline on

Amos. Ameritech does not argue that it was

unable to make the discharge decision within this

period of time. In fact, the only explanation

that Ameritech has offered for not meeting the

deadline is that its EEO coordinator, Monica

Sharp, left on vacation immediately after she

made the recommendation to discharge Amos, and

labor relations manager Joyce Leck did not review

the recommendation until she herself returned

from vacation, after the thirty-day deadline for

action had expired. So nothing precluded

Ameritech from firing Amos; it simply dropped the

ball. Standing alone, this is, at the least, a

classic instance of neglect. See Universal Reins.

Corp. v. Allstate Ins. Co., 16 F.3d 125, 128 (7th
Cir. 1994). Considered in light of Amos’

extensive history of harassment, and Ameritech’s

own professed certainty that an arbitrator would

never have permitted a late discharge, missing

the deadline amounts to something much worse.

 It is thus more than a bit ironic that

Ameritech’s own unreasonable failure to act

within the constraints of the collective

bargaining agreement has been transformed into a

defense to liability for both compensatory and

punitive damages. The thirty-day time limit was

not one unilaterally imposed on Ameritech by the

union. The company consented to that restraint in

negotiations with the union, and presumably it

did so with confidence that thirty days was

enough time to make discharge and other

disciplinary decisions. Having agreed to the time

limit, and presumably knowing from past

experience that an arbitrator might well declare

a discharge made beyond that time frame invalid,

Ameritech knew that it had to discharge Amos

within thirty days or not at all. 

 To accept Ameritech’s argument on its own

terms, then, is to appreciate the gravity of the

company’s mistake in allowing the deadline to

expire. If, as Ameritech posits, the thirty-day

time limit on discipline was ironclad, then the

only pertinent question insofar as the

reasonableness of Ameritech’s actions and state

of mind is concerned is what Ameritech did during

those thirty days. The answer is nothing. It was

entirely fair, in that context, for the E.E.O.C.

to castigate Ameritech for not discharging Amos

when, as the company admits, its own slip-up

accounts for the inability to take that step. See

Tr. 1301-04, 1356-57. It was also entirely within

the district court’s discretion to prevent

Ameritech from attempting to pin the failure to

discharge Amos on the likelihood that an

arbitrator would order him reinstated. Only

Ameritech is to blame for the situation in which

it found itself. Knowing that it had to act

within thirty days, the company dallied, allowing

the deadline to come and go without doing

anything. That the company may have wished to

fire Amos, that it might have done so eventually

but for its fears about what an arbitrator would

say, is beside the point. See Ameritech Br. 17-

18, 34. It would be a bit like a reckless driver

claiming that he meant to use more care after he

has already mowed down a pedestrian--good

intentions mean nothing after the fact. Ameritech

is no less culpable for allowing the deadline to

expire before acting on Sharp’s recommendation to

discharge Amos than it would be if it never

considered discharging him at all.

 There is a second, but equally important, flaw
in the arbitration defense insofar as it revolves

around the thirty-day limit. Ameritech would have

us believe that the jury was kept in the dark as

to the reason for the company’s decision not to

fire Amos in December 1992. Its opening brief,

for example, asserts that "Ameritech was

prevented from presenting the evidence explaining

why it did not terminate Amos at that time--

specifically, because an arbitrator would have

reinstated him." Ameritech Br. 34 (emphasis in

original); see also Reply Br. 12-13. Yet, as my

colleagues acknowledge, Ameritech was able to

explain that it did not discharge Amos in

response to Debbie Wentland’s complaint because

it did not effectuate that decision within the

thirty-day time frame specified by the collective

bargaining agreement. See, e.g., Tr. 1327. In

fact, as the record reveals, the thirty-day limit

on disciplinary action was discussed again and

again (and again) during the trial--on more than

twenty occasions, by my count. See Tr. 38-39,

202-03, 212, 219-26, 234-35, 248-55, 259-260,

261, 279, 280, 291, 335-40, 521, 608-09, 627,

642-48, 777, 779, 807, 926, 1103-04, 1145-46,

1301-04, 1327, 1356-57. The jury was thus fully

aware of the deadline and the constraints it

imposed on Ameritech’s ability to deal with Amos.

Evidence that an arbitrator would have enforced

that deadline might have been apropos had a

witness or the E.E.O.C. opined that Ameritech was

free to ignore the deadline and fire Amos anyway.

Ameritech suggests that this was the case.

Ameritech Br. 34; Reply Br. 12-13. My colleagues

appear to agree. See ante at 20. They have been

misled. A review of the record makes clear that

no one--no one--ever suggested that Ameritech

could have fired Amos after the thirty-day

deadline had expired. On the contrary, the

attorneys in their questions and argument, and

the witnesses in their testimony, uniformly

presumed that the time limit was inviolable./1

As far as the jury knew, then, there was no way

around the thirty-day deadline. The notion that

there was a compelling need for the arbitration

evidence is therefore a fallacy. As the record

makes plain, the E.E.O.C. chastised Ameritech not

for being unwilling to try and circumvent the

deadline after it had already expired, but for

failing to meet the deadline in the first

instance. See Tr. 1301-04; 1356-57./2

3.

 In June of 1993, another provision in the

collective bargaining agreement purportedly stood

in the way of discharging Amos. It was then that

Amos wrote a note to Patti Wolter telling her

"Patti, you look so sexy today." Tr. 387

(emphasis in original). Rather than discharging

him, Ameritech opted to impose the most serious

form of discipline short of discharge--it
suspended him for thirty days. The collective

bargaining agreement permitted discharges only

for "just cause," and if permitted Ameritech

would have shown that it had lost one or more

arbitrations over the just cause issue and that

in all probability, had Ameritech fired Amos for

writing the note, he would have won reinstatement

from an arbitrator.

 One can readily appreciate why an arbitrator

might not think that the note by itself

constituted just cause to discharge Amos.

Although troubling to Ms. Wolter--as it indeed

might have been to any reasonable person--the

note standing alone was relatively innocuous. In

view of Amos’ lengthy tenure with the company,

terminating him simply because he wrote that

single note to a co-worker would be a harsh form

of discipline. Indeed, a Title VII claim founded

on the note alone would surely falter, for

without more it would not establish the

objectively hostile working environment that the

case law requires. E.g., Rennie v. Dalton, 3 F.3d

1100, 1107 (7th Cir. 1993), cert. denied, 510

U.S. 1111, 114 S. Ct. 1054 (1994) ("’isolated

and/or trivial remarks of a sexual nature’ do not

satisfy the definition of sexual harassment"),

quoting Downes v. F.A.A., 775 F.2d 288, 293 (Fed.

Cir. 1985), abrogated on other grounds by Harris

v. Forklift Sys., Inc., 510 U.S. 17, 114 S. Ct.

367 (1993).

 It is not at all clear, however, why the note,

considered in the full context of Amos’ campaign

of harassment, would not have constituted just

cause for termination. By June of 1993, of

course, Amos had a well-documented history of

harassing women at Ameritech. What is more, the

more severe manifestations of that harassment

often were presaged or accompanied by remarks

akin to the "you look so sexy" observation Amos

made in his note to Wolter. Before Amos pushed

his aroused body against Jacquelyn Stine in 1988,

for example, he told her that her hair was

beautiful, that it was "just really delicious, or

. . . sensual," and that he was in love with her.

Tr. 73. And just before Amos followed Debbie

Wentland around the office in November 1992 as he

rubbed the erection in his pants, he patted her

stomach and remarked "Oh, so you are going to be

a mom." Tr. 271-72. These examples, among many

others, demonstrate all too well that statements

of the kind Amos made to Wolter were neither

isolated nor innocent. Typically, these remarks

were part of a pattern of verbal and physical

harassment which, left unchecked, simply

escalated.

 Why an arbitrator would blind himself to this

pattern--and to the proven ineffectiveness of
all disciplinary measures short of discharge in

stopping Amos’ harassment--is left unexplained.

Ameritech’s prediction of reinstatement seems to

assume that the arbitrator would focus solely

upon the event precipitating the discharge,

without consideration of any of Amos’ prior

conduct. Cf. Chrysler Motors Corp. v.

International Union, Allied Indus. Workers of

America, 959 F.2d 685, 686 (7th Cir. 1992)

(arbitrator refused to consider other incidents

of harassment that employer only discovered after

it had already discharged worker), cert. denied,

506 U.S. 908, 113 S. Ct. 304 (1992). Yet, so far

as the record reveals, nothing in the collective

bargaining agreement so restricts the just cause

inquiry. If it did, then we might well have a

genuine clash between the collective bargaining

agreement and Title VII that Ameritech posits.

For Title VII would indeed expect Ameritech to

have learned its lessons. When Amos wrote the

note to Wolter, Ameritech must have known that he

simply was not going to stop harassing his female

co-workers, and that terminating him was the only

way to bring the harassment to an end. See Tr.

233, 406, 630-31, 701. Indeed, one can read into

Ameritech’s arbitration defense a concession that

it knew as much; by the company’s own account, it

was simply awaiting the best opportunity to make

his discharge "stick." See Ameritech Br. 17-18,

34. But in this record there is no proof that the

collective bargaining agreement posed an obstacle

to discharging Amos in June of 1993.

4.

 Ameritech’s arbitration defense also presupposes

that if Ameritech had discharged Amos in either

December of 1992 or June of 1993 and an

arbitrator had subsequently ordered him

reinstated, that order would have been final.

That is not the case. Even if an arbitrator had

ordered Amos’ reinstatement, Ameritech could have

contested that decision in court. As the district

court recognized, courts can and do refuse to

enforce arbitration awards when they conflict

with explicit, well-defined public policy.

Chrysler Motors, supra, 959 F.2d at 687; see

generally United Paperworkers Int’l Union v.

Misco, Inc., 484 U.S. 29, 43, 108 S. Ct. 364,

373-74 (1987); W.R. Grace & Co. v. Local Union

759, Int’l Union of United Rubber, Cork, Linoleum

& Plastic Workers of America, 461 U.S. 757, 766,

103 S. Ct. 2177, 2183 (1983). The public has a

strong interest, which Title VII embodies, in

eliminating sex discrimination from the

workplace. Chrysler Motors, 959 F.2d at 687.

Reinstating an employee who either does not wish

or is unable to refrain fromsexually harassing

his female co-workers presents an obvious clash

with that interest. See, e.g., Stroehmann
Bakeries, Inc. v. Local 776, International

Brotherhood of Teamsters, 969 F.2d 1436, 1442 (3d

Cir. 1992) (vacating arbitration award

reinstating harasser who allegedly assaulted

customer’s employee: "an award which fully

reinstates an employee accused of sexual

harassment without a determination that the

harassment did not occur violates public

policy"), cert. denied, 506 U.S. 1022, 113 S. Ct.

660 (1992); Newsday, Inc. v. Long Island

Typographical Union, No. 915, 915 F.2d 840, 845

(2d Cir. 1990) (vacating arbitration award

reinstating serial harasser: "[The arbitrator’s]

award of reinstatement completely disregarded the

public policy against sexual harassment in the

work place."), cert. denied, 499 U.S. 922, 111 S.

Ct. 1314 (1991); Consolidated Edison of New York,

Inc. v. Utility Workers’ Union of America, No. 95

C 1672, 1996 WL 374143, at *5 (S.D.N.Y. Jul. 3,

1996) (vacating arbitration award reinstating

serial harasser: "Reinstatement of an employee

who has already been issued a strong and

unambiguous warning that any further sexual

misconduct could lead to dismissal would

contravene public policy condemning such

behavior."). Ameritech thus had a firm basis on

which to resist Amos’ reinstatement. Of course,

we cannot know for certain how Ameritech would

have fared in the effort to overturn an adverse

decision by the arbitrator. But that is the

point: having forsaken the opportunity to make

its case to an arbitrator and, if necessary, to

a court, Ameritech has left us all to speculate

about what might have happened. 

 Moreover, it is not at all clear to me how

Ameritech’s other employees would have been worse

off had the company risked arbitration by

discharging him in either December of 1992 or

June of 1993. As Judge McKinney wrote,

"Overlooked in this argument is the continuing

adverse effect Amos’s conduct may have on the

female employees while the employer waits until

it thinks it may have enough evidence to overcome

an arbitration decision." R. 213 at 10. For

whatever length of time it would have taken for

the anticipated arbitration and litigation over

the discharge to be resolved, Amos would have

been removed from the workplace, granting his

female co-workers at least a temporary reprieve

from his harassment. In the event of his

reinstatement, Ameritech would have been just as

capable of terminating him in the future if and

when he resumed harassment as it was when the

company decided in December 1992 and again in

June 1993 to "wait and see" rather than

discharging him on those occasions. See Chrysler

Motors Corp. v. International Union, Allied

Indus. Workers of America, 2 F.3d 760 (7th Cir.

1993) (sustaining the immediate discharge of
reinstated employee based on additional evidence

of harassment). Only Ameritech, it seems to me,

had anything to gain by following the latter

course, sparing itself the possible expense and

bother of having to defend a discharge in

arbitration and/or litigation.

 5.

 Even assuming that there was an outright,

irreconcilable conflict between the collective

bargaining agreement and Title VII, I am not

convinced that Ameritech’s obligation to protect

its employees from harassment necessarily had to

yield to the constraints imposed by its contract

with the union. The district court may have

overstated matters when it said that the

provisions of a collective bargaining agreement

must invariably give way to an employer’s

obligations under the civil rights statutes (R.

213 at 9), for Trans World Airlines, Inc. v.

Hardison, 432 U.S. 63, 97 S. Ct. 2264 (1977), and

Eckles v. Consolidated Rail Corp., 94 F.3d 1041,

1051 (7th Cir. 1996), cert. denied, 520 U.S.

1146, 117 S. Ct. 1318 (1997), reveal that this is

not always the case. But neither of those

precedents, on the other hand, gives an employer

license to sit back while its workers are

sexually harassed, simply because it believes

that a provision of the collective bargaining

agreement stands in the way of effective action. 

 TWA holds simply that Title VII does not

require an employer to interfere with the

seniority rights of some employees in order to

accommodate the religious needs of others. The

plaintiff in that case worked for an airline in

a critical department that operated twenty-four

hours a day, seven days a week. After becoming

involved in a religion that proscribed work on

Saturdays and on certain religious holidays, the

plaintiff asked that his work schedule be

adjusted accordingly to give him those days off.

Although the company had no difficulty finding

volunteers to fill in for the plaintiff on the

religious holidays that he observed, no one was

willing to work in his stead on Saturdays.

Consequently, the only means of accommodating the

plaintiff’s religious needs would have been to

deprive more senior employees of their shift

preferences by requiring one or more of those

employees to take the Saturday shifts. The

airline refused to take that step, and the

Supreme Court concluded Title VII did not compel

it to do so:

We agree that neither a collective-bargaining

contract nor a seniority system may be employed

to violate the statute, but we do not believe

that the duty to accommodate requires TWA to take
steps inconsistent with the otherwise valid

agreement. Collective bargaining, aimed at

effecting workable and enforceable agreements

between management and labor, lies at the core of

our national labor policy, and seniority

provisions are universally included in these

contracts. Without a clear and express indication

from Congress, we cannot agree with Hardison and

the E.E.O.C. that an agreed-upon seniority system

must give way when necessary to accommodate

religious observances.

432 U.S. at 79, 97 S. Ct. at 2274 (footnote

omitted). The rights of other employees, as well

as the unique importance of seniority provisions

in collective bargaining, figured prominently in

the Supreme Court’s analysis. "It would be

anomalous," the Court explained, "to conclude

that by ’reasonable accommodation’ Congress meant

that an employer must deny the shift and job

preference of some employees, as well as deprive

them of their contractual rights, in order to

accommodate or prefer the religious needs of

others. . . ." Id. at 81, 97 S. Ct. at 2275; see

also id. at 85, 97 S. Ct. at 2277. The Court went

on to note that the statute itself singles out

seniority rights for special treatment, "mak[ing]

clear that the routine application of a bona fide

seniority system would not be unlawful under

Title VII." Id. at 82, 97 S. Ct. at 2275, quoting

International Brotherhood of Teamsters v. United

States, 431 U.S. 324, 352, 97 S. Ct. 1843, 1863

(1977).

 Our own opinion in Eckles sounds the same

theme. The issue there was whether the Americans

with Disabilities Act required an employer to

guarantee an employee a position compatible with

his medical restrictions even if it meant

"bumping" a more senior employee from the

position in the first instance and preventing

other employees with greater seniority from in

turn "bumping" the plaintiff from that position

later on. Accommodating him in this way "pose[d]

a conflict not so much between the rights of the

disabled individual and his employer and union,"

we observed, "but between the rights of the

disabled individual and those of his co-workers."

94 F.3d at 1046. Relying on TWA and a host of

other cases decided under both the Rehabilitation

Act as well as the ADA, we concluded that the

duty to reasonably accommodate the limitations of

a disabled employee did not compel the employer

to ignore the seniority rights of other workers.

Id. at 1051. We were quite careful to emphasize

the narrow reach of our opinion, however.

We emphasize that our conclusion is limited to

individual seniority rights and should not be

interpreted as a general finding that all
provisions found in collective bargaining

agreements are immune from limitation by the ADA

duty to reasonably accommodate. The ADA does not

lack force in the unionized workplace, and the

duty to provide for the special needs of disabled

workers cannot be voided by either skillful

manipulation (such as a pretextual seniority

system) or inadvertence. We recognize that many

of the "reasonable accommodations" specifically

proposed within the ADA also have effects on

other workers, but find that collectively

bargained seniority rights have a pre-existing

special status in the law and that Congress to

date has shown no intent to alter this status by

the duties created under the ADA.

Id. at 1051-52; see also id. at 1046 n.9 ("We

most certainly do not here decide that all

provisions of collective bargaining agreements

will preempt a covered entity’s duty to

reasonably accommodate a disabled employee under

the ADA. We address only collectively-bargained

seniority systems that establish rights in other

employees.").

 My colleagues have taken a significant leap

beyond the holdings and rationale of both TWA and

Eckles in concluding that an employer may invoke

the provisions of a collective bargaining

agreement, and its concerns about how an

arbitrator might enforce those provisions, as an

excuse for the failure to remove a recalcitrant

harasser from the workplace. Neither TWA nor

Eckles remotely speaks to this issue, and

fundamental differences between those cases and

the one before us suggest that we should not be

so quick to rely on them now. This case does not

present the clash between the rights of the

plaintiff and the rights of his co-workers that

confronted the courts in those two cases. Indeed,

seniority rights, which occupy a position of

central importance in the collective bargaining

process that was cited repeatedly in both TWA and

Eckles, are not implicated here at all. Instead,

we are dealing with two entirely different

provisions of a collective bargaining agreement,

neither one of which, as I have explained above,

necessarily conflicts with the employer’s duty to

deal with harassment proactively. To the extent

that either of these provisions imposes a

constraint that might prevent an employer from

taking action that Title VII would otherwise

require--as Ameritech’s arbitration defense

supposes--we should hesitate to allow these

provisions to trump an employer’s obligations

under Title VII.

 The thirty-day limit on discharging or otherwise

disciplining an employee is simply that, a
limitation on the timing rather than the

substance of the action that an employer may take

against an employee. I do not doubt that, as a

general matter, the employees and their union

have a legitimate interest in seeing that

deadline enforced; and certainly Amos, as the one

facing termination, had a keen interest in the

enforcement of that limit. But as a procedural

limitation, the thirty-day limit surely ranks

much lower in the hierarchy of importance among

collective bargaining terms than seniority

provisions, which were central to the rationale

of TWA and Eckles. Recall too that the thirty-day

limit is not absolute--Ameritech could have taken

as much time as it wished to make the discharge

decision if only it had suspended Amos

immediately at the outset of its investigation.

See ante at 6 n.2. So as between the collective

bargaining agreement’s directive that discipline

be meted out within thirty days, and Title VII’s

command that employees be protected from sexual

harassment, I have little doubt that the latter

should prevail, as Judge McKinney reasoned.

 The just cause provision of the collective

bargaining agreement is, of course, more

substantive. For that reason, it may occupy a

position of more central importance to the

collective bargaining process. That does not

mean, however, that such a provision--or an

arbitrator’s interpretation of it--will or should

prevail over the employer’s Title VII duty to

address workplace harassment. On the contrary,

the case law already makes clear that the public

interest in eradicating sexual harassment will in

some instances take priority over an arbitrator’s

assessment of just cause. For example, in

Chrysler Motors Corp. v. International Union,

supra, 959 F.2d 685, Chrysler asked the court to

set aside an arbitrator’s order reinstating an

employee discharged for sexual harassment. We

acknowledged the public policy against workplace

harassment reflected in both Title VII and the

E.E.O.C.’s sexual harassment guidelines. Id. at

687-88. We also agreed that it would be

appropriate for the court to set aside an

arbitration award that clashed with this policy.

"As with any contract, a court may not enforce an

arbitrator’s interpretation of a collective

bargaining agreement that is contrary to public

policy." Id. at 687. As it turned out, we were

not convinced that the particular order under

review in Chrysler did run afoul of public

policy. The evidence before the arbitrator

indicated that the harasser had only engaged in

a single instance of misconduct and that he was

never warned or otherwise disciplined prior to

his discharge; the record also gave the

arbitrator no cause to believe that he was

incapable of rehabilitation. 959 F.2d at 688-89.
Under those circumstances, we believed that the

arbitrator’s order reinstating him was consistent

both with the just cause provision of the

collective bargaining agreement and with public

policy. Id. at 689. What is implicit throughout

our opinion, however, is that we would not

hesitate to set aside an arbitrator’s order if,

for example, it required the reinstatement of a

recidivist harasser, a move that would jeopardize

the rights of his co-workers and undermine the

public interest in a harassment-free workplace.

Our sister circuits have done just that. E.g.,

Newsday, Inc. v. Long Island Typographical Union,

supra, 915 F.2d at 845; see also Stroehmann

Bakeries, Inc. v. Local 776, International

Brotherhood of Teamsters, supra, 969 F.2d at

1442. 

 The rights of Amos’ co-workers cannot be overemphasized in this analysis, particularly in view

of the rationale of TWA and Eckles. In each of

those cases, the rights of other employees would

have suffered had the plaintiff been given the

accommodation he sought. Here the opposite is

true. The women who worked around Amos had an

undeniable interest in seeing Amos discharged as

promptly as possible once it was clear that

milder forms of discipline were ineffective in

stopping his abhorrent behavior. On the other

hand, allowing Amos to remain in the workplace

until Ameritech believed it had a sure-fire case

of just cause to fire him had the predictable

consequence of subjecting more women to a hostile

work environment.

 These distinctions vanish today, however, as my

colleagues articulate no limits on what types of

collective bargaining agreement provisions trump

an employer’s obligation to remediate

discrimination. This is a troubling result, for

both this and future cases. Never mind that

Ameritech alone is responsible for the failure to

comply with the contractual deadline in December

1992; and never mind that no arbitrator or court

was ever invited to decide whether discharging

Amos either then or in June of 1993 would have

been appropriate notwithstanding the thirty-day

and just cause provisions of the collective

bargaining agreement. Having waited for years

(and years) to get rid of Amos, Ameritech may now

hold up the collective bargaining agreement as a

fig leaf for its own inaction. I have no doubt

that other unionized employers will follow suit.

6.

 Even if the district court did err in excluding

evidence as to the collective bargaining

agreement and Ameritech’s fears of unfavorable

arbitration, that error does not require us to
overturn the jury’s verdict and put these parties

to the expense of a new trial. Two quick points

deserve making in that regard.

 Overwhelming evidence supports the jury’s

finding that Ameritech’s response to the

harassment was negligent, and that the company

was therefore liable for compensatory damages

under Title VII. Indeed, the evidence here comes

about as close as I have seen to a case for

liability as a matter of law. At the outset of

the relevant time period in November 1991,

Ameritech knew that it had a dangerous employee

on its hands. Amos had already harassed thirteen

women by then and showed no signs of stopping. On

the contrary, he went right on verbally

harassing, touching, and rubbing his penis

against his female co-workers. Yet, as I

indicated above, Ameritech’s reaction continued

to be half-hearted, bumbling, and wholly

ineffective. The failure to effectuate Amos’

discharge in December 1992 within the time frame

specified by the collective bargaining agreement

is but another example of the company’s

negligence. At the very least, the underlying

verdict on liability should stand. To suggest

that any reasonable jury would find Ameritech’s

conduct non-negligent is, I must respectfully

submit, preposterous.

 The question of punitive damages might at first

seem closer in view of the more culpable state of

mind required for such damages. But one must bear

in mind that Ameritech enjoyed the benefit of a

jury instruction that toughened the E.E.O.C.’s

burden of proof on punitive damages beyond what

the law actually requires. Over the E.E.O.C.’s

objection, the district court instructed the jury

that the Commission must prove Ameritech’s

reckless indifference by clear and convincing

evidence. Tr. 1114-15, 1378. Yet, a mere

preponderance of the evidence is all that is

necessary to support an award of punitive damages

under 42 U.S.C. sec. 1981a(b)(1). Knowlton v.

Teltrust Phones, Inc., 189 F.3d 1177, 1186 (10th

Cir. 1999); Stender v. Lucky Stores, Inc., 803 F.

Supp. 259, 324 (N.D. Cal. 1992); see generally

Price Waterhouse v. Hopkins, 490 U.S. 228, 253,

109 S. Ct. 1775, 1792 (1989). The fact that the

jury found the E.E.O.C.’s evidence compelling

enough to meet even this heightened burden

demonstrates just how strong the Commission’s

case was.

 In the series of Ameritech’s ineffective

responses to Amos’ harassment, one has no

difficulty detecting a reckless indifference to

the plight of the company’s female workers. More

than once the company responded to a complaint

about Amos as if it were the first, failing to
check his employment history, failing to ratchet

up the discipline from that which had already

been imposed previously, and, in December of

1992, failing to ensure that the time period in

which disciplinary measures could be imposed

would not be permitted to expire. Considering

what the company knew as of November of 1991, it

should have been on high alert from that point

forward, prepared to deal with any and all

complaints about Amos expeditiously and

efficaciously. After it dropped the ball in

December 1992, it should have been all the more

at the ready to protect its other employees. Even

so, three more complaints were required before

Ameritech finally terminated Amos. The fact that

it took the company nearly twenty years to bring

the harassment to an end is telling in and of

itself.

 Twenty years!

 I respectfully dissent.

1/ See, e.g., Tr. 627 ("Q. And meeting that 30 day

time frame is essential, correct? A. Absolutely

essential."); 645-46 ("Q. Let me ask you this:

Has there ever been an occasion, to your knowledge, where somebody had been terminated outside

of the 30 day calendar day period prescribed by

the contract? A. Not to my knowledge. . . . Q.

Could you have suspended Mr. Amos pending investigation and disciplined him under the contract

at that time? A. No. Q. Why not? A. Because the

30 day clock had come and gone."); 779 ("Q. What

did you hear from Joyce Leck? No action could be

taken because of [the] 30 day time line? A.

Right, exactly."); 807 ("Q. Isn’t it a fact that

any discipline cannot be done outside of 30 days? 

A. I now know that, but I may have not known that

before. . . ."); 1145-46 ("Q. Is there a rule in

the collective bargaining agreement that says

that the company cannot take any disciplinary

action after 30 days from the incident? A. Yes. 

Q. Has the union ever consented to the waiver of

that 30 day rule? A. Not that I’m aware of. . .

. Q. And if the company missed that time line is

it the union’s position that the company is

absolutely forbidden from taking any type of

discipline? A. Right.").

/2 Ameritech argues that Debbie Wentland’s testimony

triggered the need for the arbitration evidence.

Wentland testified that upon hearing the news

that Ameritech would not discipline Amos because

of the missed deadline, "I was very upset. I was

hurt. It is just, I guess I was naive, because I

felt like I had worked with the company for 14

years, and again they had no respect for me, they
didn’t care about my feelings. They were more

concerned about Gary’s rights than mine." Tr.

280. Nowhere in Wentland’s expression of frustration, however, is there a suggestion that the

company could have disregarded the contractual

deadline. The direct testimony on that point is

entirely to the contrary. See n.1, supra. Indeed,

when read in context, Wentland’s criticism was

directed to the half-hearted and ineffective

manner in which the company handled her complaint

as well as those of the other women that Amos

harassed. See Tr. 275-82, 284, 329-40.

 Ameritech also points out that manager Darlene

Olberding testified that she would have recommended the dismissal of Amos for Wentland’s

complaint (Tr. 174) and again suggests that the

exclusion of the arbitration evidence left the

company unable to explain why Amos was not discharged. Ameritech Br. 34; Reply Br. 10. But

Olberding herself acknowledged that the administrative "slip-up" precluded action against Amos

(Tr. 174); and she never suggested that the

company had the power to ignore the collective

bargaining agreement. The fact that she thought

termination was the appropriate response was

hardly remarkable in and of itself. After all,

EEO coordinator Monica Sharp recommended that

Amos be discharged (Tr. 776-77, 847). And Robert

McFeely, the director of human resources for the

five-state region served by Ameritech, himself

testified that Amos would have been terminated

but for the fact that the company missed the

thirty-day deadline. Tr. 226.