What Has the Latest Scandal Caused and What Can It Teach Your Company

As corporate, political, and elite entertainment circles are rocked by revelations on a daily basis, HR managers, owners, and CEOs at businesses of all sizes are scrambling to attempt to fix a problem that has been decades in the making.

The tip of the iceberg came to light on October 5, 2017, when it was announced that movie producer and studio owner Harvey Weinstein was accused of the assault and harassment of dozens of women. These accusations have led to further allegations of harassment by some of the best-known leaders in the entertainment, technology, business and political worlds. Many of the accused have either been fired or resigned their positions and all have inflicted untold emotional damage to co-workers and serious financial damage to the companies for whom they worked.

As of November 27, 2017, there have been more than 60 high-profile accusations, with more expected to come. These accusations have spanned industries, career types, levels of severity, and length of time since the alleged incidents.

Other than the high level of publicity surrounding the accusations, the cases share little in common. As such, these cases have garnered much more attention than the average accusation, and can be seen as “cautionary tales” for all companies - small, medium and large. Indeed, there are several important lessons to learn from their downfall.

The subject of employee harassment is just one of the many issues addressed by the human resource specialists at Resourcing Edge

As a Certified Professional Employer Organization (CPEO), Resourcing Edge supplies cost-effective, integrated and customized solutions that help manage its clients’ HR responsibilities.

Are you legally prepared for a sexual harassment lawsuit? A Customized HR Solution can ensure your business and your employees are protected.

What Constitutes Harassment in the Workplace?

A company’s worst HR nightmare is having a high-profile executive accused of sexual harassment. Attorney Kim Freeman, counsel for Resourcing Edge was asked about the actions that constitute “sexual harassment” of one employee by another?

“Generally, there are two types of sexual harassment claims, Freeman said. “ The two are quid pro quo (Latin for “this for that”) and hostile work environment. 

“Quid pro quo harassment occurs when an employment decision, such as a promotion, assignment or keeping a job, depends on submitting to unwelcome sexual advances, requests for sexual favors or other verbal and physical sexual conduct.

Freeman goes on to explain that a hostile work environment would occur when unwelcome sexual advances, or other physical and verbal sexual conduct has the effect of interfering with work performance, or creating an intimidating, offensive, environment. 

For example, states Freeman, “a female-dominated sales team tells sexually explicit jokes, talks about their recent sexual escapades on a sales trip and leaves prank gifts, like sex toys, for its one male member who is mortified and embarrassed. The behavior is so pervasive he cannot work effectively and either quits or is fired. This could lead to a claim for hostile work environment.”

As a lawyer with years of PEO (Professional Employer Organization) experience, Freeman says that sexual harassment isn’t always overt, like a demand for sex, or a direct sexual assault. “Examples include, but are not limited to, the discussion of sex or sex partners, sexual innuendo, repeated ‘accidental’ touching, sexual jokes/memes/pictures, and even obscene texts or phone calls.”

“While the law doesn’t prohibit teasing, or offhand remarks, the impact to the employee is what defines the harassment.”

What to Do About a Harassment Claim?

As companies that have dealt with the fallout of employee harassment have learned the hard way, the best solution for these actions is prevention. There are several steps that should be considered when harassment is suspected.

“The most important step is the one that should have taken place long before any claim is made,” Freeman said. “A company must have an anti-sexual harassment policy in its employee handbook, and every employee should have signed a separate acknowledgment of the policy. The acknowledgment should be on file with the company or the Professional Employment Organization (PEO). In addition, all employees, including managers and executives, should receive annual anti-sexual harassment training.

“However, if a complaint of sexual harassment is made, or if human resources becomes aware of rumored harassment, a thorough investigation must occur. The employee should be assured that no retaliation will occur for coming forward and the accused should be notified of the complaint and warned that no acts of retaliation will be tolerated. 

“In the case of a PEO partnership, the PEO should be informed immediately. The PEO partnership provides employers with the extra support structure that can mean the difference between a crisis and a solution. Then the incident is first reported, the PEO can help the worksite employer with the investigation, and if necessary, the PEO can notify its insurance carrier of a possible claim. It is important that the complaint, investigation, results and any remedial or disciplinary actions be thoroughly documented.”

What Are the Company’s Liabilities Related to this Harassment?

“There are a couple of legal standards that can apply to make an employer liable for damages because of sexual harassment in the workplace,” Freeman said. “If the claim involves a supervisor harassing an employee, the company must answer for the conduct under a ‘vicarious liability standard’ known as “respondent superior,”(“let the master answer.”) ”  These situations most often arise under the “quid pro quo” type of sexual harassment.

“When sexual harassment claims originate between co-workers, the standard applied is one of negligence. Basically, the employer is being accused of having failed to do something that he has a duty to do. In this case, it is the prevention of sexual harassment on the job. The negligence standard is harder to prove than vicarious liability. To prevail, a claimant must show: (a) the employer knew or should have known about the harassing conduct and (b) the employer failed to stop the conduct.

“A claimant could be entitled to back pay, front pay, compensatory and punitive damages. Damages could range in the tens of thousands to millions of. In 2016, a company in California was ordered to pay nearly $1.5 million in damages in a sexual harassment and retaliation lawsuit filed by the Equal Employment Opportunity Commission (EEOC). In that case, the court found that a dried fruit processing company subjected multiple female farmworkers to continuous sexual advances, stalking and unwanted physical touching.  When male and female workers complained about the hostile work environment, they were fired in retaliation.

As far as the legal statutes involved in employee harassment, Freeman notes, “Companies can face litigation pursuant to Title VII of the Civil Rights Act of 1964, which prohibits discrimination in employment based on sex, race, color, national origin and religion. Many states have similar protections as well, and those could be cited in a complaint on sexual harassment. Besides the claim for sexual harassment, a complainant could also bring an action for retaliation if fired (or other adverse action was taken) after reporting the incident. 

What’s Next?

Accusations, spanning industries and career levels, continue to mount daily, and we have no way of truly knowing how big the iceberg truly is yet. As the #MeToo social media movement gains a similar traction, more men and women will feel empowered to come forward to their current and past employers. Better anti sexual-harassment training, such as the webinars designed and offered by Resourcing Edge, as well as communication about what sexual harassment is, and the measures in place to protect employees who report harassment, is a large step in the right direction. 

There is nothing more important than the safety of employees in the workplace. With appropriate HR policies and partnerships in place, companies can ensure a safe culture for all.

What would your company do if you were accused of employee harassment? Do you have an up-to-date employee handbook that deals with this issue? For a no-obligation consultation on ways your company can avoid employee harassment suits, Contact Us