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Sexual Harassment

The Basics, the Skeletons In Your Closet, and How to Be Prepared

Harvey Weinstein has put the spotlight on sexual harassment in the workplace. Under this light we see multiple industries struggling with their own sexual harassment allegations and revelations.

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Harvey Weinstein has put the spotlight on sexual harassment in the workplace. Under this light we see multiple industries struggling with their own sexual harassment allegations and revelations. For instance, restaurateur John Besh, a world-famous New Orleans chef, has been accused of not only sexually harassing an employee, but also allowing a hostile work environment to run rampant throughout his restaurants. Amazingly, his 1200-person company did not have a Human Resources department until the allegations came to light, at which point the company quickly hired an HR professional to try to control the damage.

Due to the same underlying issue, but through no fault of its own, Netflix, the movie streaming giant, has scrapped multiple shows and/or terminated its relationships with actors in recent weeks due to sexual harassment allegations against its stars, including Kevin Spacey and Louis C.K. Not surprisingly, politics is not immune from this blight; there have been multiple allegations of sexual harassment including harassers exposing their genitals and grabbing victims’ private parts in various Congressional offices, as well as the continued allegations against Roy Moore from Alabama, who recently lost his bid for the Senate, and Rep. John Conyers from Michigan. This controversy caused the Senate to pass a resolution in November mandating sexual harassment training for everyone working in Congress’ upper chamber. In light of all of these allegations across multiple industries and even in United States government, victims of sexual harassment are now feeling more emboldened than ever to speak out. All sectors of our society are reeling from such allegations, and are looking for any way to avoid the damning exposure of these claims.

In light of this new reality, now is a prime time for employers to revisit their sexual harassment policies and practices and learn from the mistakes of others. Aside from being against the law, sexual harassment can create serious public relations problems and destroy productivity. Failure to recognize these realities can devastate the continued viability of a company. For instance, the Weinstein Company is currently in shambles due to the voluminous allegations against one of its founders.

Two Types of Sexual Harassment Claims

As employers have long known, under Title VII of the Civil Rights Act of 1964, it is unlawful for an employer to “fail or refuse to hire or to discharge any individual, or otherwise to discriminate against any individual with respect to his compensation, terms conditions or privileges of employment, because of such individual’s race, color, religion, sex, or national origin.” This prohibition includes sexual harassment which is “unwelcome … verbal or physical conduct of a sexual nature … ” 29 C.F.R. 1604.11(a).

There are two types of sexual harassment claims: 1) quid-pro-quo harassment, which occurs when submission to or rejection of such conduct by an employee is used as the basis for employment decisions affecting the employee; and 2) a hostile environment where the conduct is severe or pervasive enough to create an environment that a reasonable person would consider intimidating, hostile or abusive.

From a factual perspective, a hostile work environment claim generally requires a showing of a pattern of offensive conduct, whereas a quid-pro-quo claim can arise from a single advance connected to the granting or denial of an employment benefit. For instance, an offer of a promotion in exchange for a sexual favor is a classic example of quid-pro-quo harassment. In contrast, a hostile work environment may be created when a supervisor shows employees nude photos of himself or repeatedly comments on his sex life.

Employer Liability Varies Depending on the Harasser

The question of who the harasser is determines whether the employer has vicarious liability for the harasser’s actions. For instance, if the conduct is between employees, an employer is responsible only where it was negligent in controlling the working conditions. If the harasser is a non-employee such as a vendor or the customer, the employer is only liable for known conduct or conduct it should have known about if it fails to take immediate and appropriate corrective action. This means an employer can be liable for sexual harassment of its employees by customers or vendors.

When the harasser is a customer, this often forces the employer to face a difficult business decision. For instance, the customer may account for a large portion of the company’s revenues, and management may be hesitant to make waves as a result. The law, however, absolutely requires the company to protect its employees from harassment, whether the loss of the customer will hurt the bottom line or not.

In contrast, if the harasser is a supervisor and the harassment culminates in a tangible employment action, the employer is strictly liable. Examples of common tangible employment actions are termination and failure to receive a promotion.

An Affirmative Defense to Employer Liability

If no tangible employment action occurs and the harasser is a supervisor, the employer can escape liability by establishing an affirmative defense that: 1) the employer exercised reasonable care to prevent and correct any harassing behavior; and 2) the plaintiff unreasonably failed to take advantage of the preventive or corrective opportunities that the employer provided. Vance v. Ball State University, 133 S. Ct. 2434, 2439 (2013). For example, if the employer has a well-publicized and enforced procedure for reporting allegations of sexual harassment and the employees fails to use it, the employer can assert this affirmative defense.

This possible defense makes it imperative for employers to publicize their sexual harassment policies and make sure employees are aware of them. A key to such success is training managers on the company policy and how they should respond to employees who have complaints.

In a key part of the Vance v. Ball State University decision, the United States Supreme Court clarified the definition of supervisor. The Court held an employee is a supervisor if the employer has empowered that employee “to take tangible employment actions against the victim, i.e., to effect a significant change in employment status such as hiring, firing, failing to promote, reassignment with significant change in employment status.” Id. To protect the company, employers should determine who the supervisors are, and who each supervisor oversees. In certain situations, the company may even be able to assert a defense that the alleged harasser is not the victim’s supervisor, and thus strict liability does not exist.

Preventive Action and Remedial Measures

The Equal Employment Opportunity Commission (EEOC), the federal watchdog for anti-discrimination employment laws, encourages employers to take preventive measures to avoid sexual harassment. Such measures include: 1) affirmatively addressing sexual harassment with employees; 2) expressing strong disapproval of such conduct; 3) developing appropriate sanctions; and 4) informing employees of their right to raise and how to raise the issue of harassment under Title VII.

For employers, these measures take the form of anti-harassment training and anti-harassment policies that are well publicized to employees and that are strictly enforced. An effective anti-harassment policy should include a procedure for reporting and resolving sexual harassment complaints. This procedure, however, should not require the victim to complain to his/her supervisor if for any reason the victim is uncomfortable doing so, including that the supervisor is the alleged harasser.

Under a typical chain of command, companies often require employees to resolve issues with their direct supervisor before going over their head. This, however, cannot be the case for anti-harassment policies because it has the effect of chilling the employee’s right to object when the victim has to complain to their direct supervisor, the alleged harasser. Therefore, allowing an employee to report such claims through an alternative path, Human Resources, a dedicated hotline (which can be only of minimal cost), or even the president of the Company is crucial.

Special Issues Facing Growing Businesses

John Besh, a James Beard award winning chef and employer of 1,200 employees, stepped down from his company earlier this year when approximately 25 current and former employees accused various managers throughout his company, including Besh himself, of sexual harassment. Although chef Besh denies he had anything other than a consensual relationship with a colleague, the litigation is ongoing and the allegations have already highlighted weaknesses in his company’s structure. For instance, as mentioned earlier in this article, the company had no Human Resources department and allegedly no established complaint procedure for reporting such claims. Therefore, the alleged victims have reported they had no idea where to turn when they were being harassed (this is especially damning when a senior member of management is accused). As we mentioned, the company immediately hired a Human Resources professional as soon as the fallout of the harassment allegations began.

This, however, is not a surprising story. In fact, this is a common problem companies face that start out small and then experience significant growth, such as small family businesses that grow to become major companies. This is also true for franchisees that start with one location and expand rapidly. Often, the organizational infrastructure simply does not keep up. This is because entrepreneurs who have a small business mentality often try to minimize costs and do not employ HR professionals as needed.

They instead frequently rely on their administrative staff or payroll person to stay current with changes in labor and employment laws. Unfortunately, this cost-saving measure often fails to include the appropriate mechanism for ensuring compliance with labor and employment laws. Therefore, employers should consult with competent labor and employment counsel to avoid these risks. While there is a cost, the cost of litigation, the damage to the company’s reputation, and the loss of productivity is exponentially more.

Tips to Avoid Sexual Harassment Claims

Good first steps in rooting out and avoiding sexual harassment in the workplace includes anti-harassment training and implementing and enforcing an anti-harassment policy. Employers must also diligently monitor the work environment on a daily basis to avoid potential sexual harassment claims. This includes not engaging in behavior that could be construed as sexual harassment such as:

Additionally, employers must realize that training may not ultimately be effective. For instance, most would agree that no amount of training would likely stop the habitual harasser. This is true even if the alleged harasser is the president of the company. In those instances, the company’s board of directors or upper management must take swift corrective measures that may include terminating the relationship with the habitual harasser. Failure to do so exposes the company to huge liability.

On the other hand, being outspoken against such harassment has many positive effects. Beyond the obvious lack of liability for misconduct, your company can stand tall demanding “the right thing” from all your employees. Such a position can be a core philosophy that can attract both employees and customers to your business. You can embrace this cause because it is right and because it is good for business.

***** Robert G. Brody is the founder of Brody and Associates, LLC and a member of this newsletter’s Board of Editors. Katherine M. Bogard is an associate at the firm.

The views expressed in the article are those of the authors and not necessarily the views of their clients or other attorneys in their firm.

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