In Parker v. Reema Consulting, the Fourth Circuit addresses a claim where a female subordinate alleges that she was subjected of repeated rumors of sleeping with her supervisor to secure a promotion.  Importantly, company managers participated in the spreading of the rumors. To state a claim under Title VII for a hostile work environment because of sex, the plaintiff must allege workplace harassment that (1) was “unwelcome”; (2) was based on the employee’s sex; (3) was “sufficiently severe or pervasive to alter the conditions of employment and create an abusive atmosphere”; and (4) was, on some basis, imputable to the employer.

In this case, The Fourth Circuit agrees that these sex based rumors can serve as the basis for a hostile environment claim and that the continuous nature of the harassment was sufficiently pervasive as to interfere in her work.

https://law.justia.com/cases/federal/appellate-courts/ca4/18-1206/18-1206-2019-02-08.html