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Dealing with workplace sexual harassment.

As the spectacle of the U.S. Senate confirmation hearings on the nomination of

Clarence Thomas to the U.S. Supreme Court unfolded amidst sexual harassment charges leveled against him by Anita Hill, it soon became apparent just how difficult, painful and embarrassing such a charge can be for both the accuser and the accused. it also became self-evident that there is a wide spectrum of opinion on what constitutes sexually harassing behavior, whether it be off-color locker-room humor or actual physical contact. Now that the issue of sexual harassment has surfaced, and given the all-too-often incorrect interpretations of its meaning, it's imperative that risk managers consider urging their employers to adopt a company policy on sexual harassment that establishes measures to prevent their companies from being drawn into a lawsuit.

Joan S. Morrow, a partner with Rider, Bennett, Egan & Arundel in Minneapolis, recently discussed policies and procedures to deal with sexual harassment in the workplace at the 20th Annual Risk Management Seminar, held at the Minneapolis Convention Center and sponsored by the Minnesota Chapter of the Risk and Insurance Management Society. According to Ms. Morrow, sexual harassment can be defined as "unwanted or unwelcomed sexual behavior." But confusing the matter is the fact that every kind of "illegal" conduct, whether it be propositioning or physical contact - will be "legal" as long as the action is welcomed by the receiver.

Currently, there is no objective standard over what exactly constitutes sexual harassment. So "while the debate of what is sexual harassment rages on, one thing is clear - risk managers want to do everything they can to keep a sexual harassment lawsuit out of their companies," she added.

Ms. Morrow explained that there are two basic forms of sexual harassment. The first is "quid pro quo" sexual harassment, which can be committed only by a supervisor or employer that has some power over the complainant. This power relates to either giving or withholding some important aspect of employment. A supervisor acting in such a manner, Ms. Morrow asserted, "will almost always make the company liable whether the employer knows about it or not, because the supervisor's conduct will be imputed to the company." Quid pro quo sexual harassment can also lead to lawsuits by third-party complainants - those employees who are not sexually harassed but see others who, as the objects of such behavior, are receiving preferential treatment, higher pay raises or promotions.

The other principal form of sexual harassment relates to a "hostile work environment." Under this scenario, a hostile (or uncomfortable or embarrassing) atmosphere of constant joking or touching - actions not tied to promotions or salary increases exists wherein it unreasonably interferes with a person's ability to do his or her job. This form will not automatically lead to employer liability. "The employer will be liable for hostile environment sexual harassment only if he or she knew or should have known of what was going on," Ms. Morrow held. The standard of welcomed versus unwelcomed sexual behavior still applies.

Offensive Behavior Policy

Whsta is an employer obligated to do? Ms. Morrow asked. "Simple - provide a workplace free of discrimination in general and sexual harassment in particular. And when there is a complaint of sexual harassment and it appears that this form of behavior may be occurring, look into it and take action if there is a problem."

So how does a company go about achieving this goal? A first step to eliminating sexual harassment from the workplace is to adopt a complaint procedure and a sexual harassment policy. Ms. Morrow's firm utilizes an "Offensive Behavior Policy"- so-called because sexual harassment is not the only form of behavior risk managers may want to eliminate from the workplace. And no matter how large or small one's company may be, if it doesn't have such a policy, "adopt one immediately; it will hold your company in good stead and may steer a complaint to you directly rather than to a lawyer or the Department of Human Rights," Ms. Morrow stated.

Policy Components

Recommended components of such a company policy include the name of the person(s) who will receive the complaint and conduct the investigation. Ms. Morrow encourages employers to select someone who will be warm, receptive and competent to handle such an investigation (someone complainants will feel comfortable going to). The policy should also mandate that any supervisor who receives a complaint or suspects something inappropriate is occurring must report it to the person(s) assigned to field the complaints.

Many of the lawsuits that have come the way of Rider, Bennett, Egan & Arundel resulted when the lower-level manager did not take the complaint seriously or did not pass it on to the proper people.

A third policy component is the provision of an investigation process that, while being as discreet as possible, demonstrates the company's intent to take action. Moreover, an offensive behavior policy must assure that the employee will not be subject to retaliation by any other company employee, and that any form of retaliation for complaining will not go unpunished.

Once a policy has been formulated, it is incumbent upon the employer to publicize it in a highly visible manner, even to the point of holding meetings on the topic. "Employees need to know that management cares about these things and wants an opportunity to hear and respond to the complaint (before the plaintiff attorneys step in)," Ms. Morrow said. This educating of the employees, supervisors and managers also helps in those instances where the offender claims in the face of disciplinary action of not knowing about any such policy employees terminated for sexually harassing others may turn and file lawsuits themselves.

Traditional Pitfalls

"Complaint handling is the Achilles' heel for many employers," Ms. Morrow stated. In her experience, it is almost never sexual harassment alone that leads to a lawsuit; it is usually the botched handling of a complaint or subsequent retaliation against the complainant that produces the lawsuit. "The good news is that this suggests that if you can learn how to handle these complaints appropriately, you may be able to avoid lawsuits," she added.

Whether it is the risk manager or someone else handling the complaint, "remember that it is somebody's very personal, very human problem. So the first job as an investigator, and a major key to the success of the investigation, is to make that person as comfortable as possible, making it easy for him or her to talk," Ms. Morrow advised. That means that the investigator should refrain from making editorial comments or judgments, or challenging the reasonableness of the claimant's remarks; personal conclusions can unduly aggravate a case. Also be aware that all case file documentation could wind up in a lawsuit later. Above all, the investigator must be fair to both parties. Just as the complainant has rights, so does the accused have a right to: "hear everything he or she is charged with, respond to it, put it in context and give the names of potential witnesses," she said.

Another area where lawsuits can be avoided is in proper post-complaint follow-up. After an investigation and subsequent action, a complainant continuing to work on the premises may still be harboring negative feelings or fearing retaliation. It is important to follow-up with the complainant to determine if there has been any retaliation. If there is no problem, then record that in the file; but if there are problems, then start the investigative process all over again and take appropriate remedial action.

The employer must also do everything it can to prevent retaliation against any witnesses favorable to the claimant. Ms. Morrow has found that "many a defensible discrimination case, whether it be sexual harassment, race or religion, has turned into a successful retaliation discrimination case because an employer could not discipline his or her own emotions, and because co-workers could not behave appropriately."

Harassment Coverage

Should a case of sexual harassment ever reach the point where a lawsuit is filed, Ms. Morrow has some basic advice for the risk manager: contact your company's employment lawyer and tender the defense of the claim immediately to every insurer you have, including the workers' compensation carrier (if there are allegations of bodily injuries in that complaint) and the directors' and officers' liability (D&O) carrier (if any of the officers or executives have been sued).

In recent years, the insurance industry has looked to address more directly the risks posed by sexual kick in where others leave off. "Sexual harassment typically will not be covered under a general liability policy, and D&O policies protect only the directors and officers, not the company itself or other supervisory employees," Art McDevitt, a vice president with Reliance National in New York, explained in a recent interview.

At Reliance National, for example, sexual harassment coverage can be found under the company's employment practices liability insurance, which also covers wrongful termination, race, religion and sexual discrimination. The policy limit is $5,000,000. The minimum premium currently offered is $15,000 and the minimum deductible is $10,000. The policy is priced on three factors, Mr. McDevitt reported: the type of risk some industries, such as the legal profession, appear more prone to sexual harassment or discrimination than others; the state in which the company is located, since some, such as California, have a higher incidence of lawsuit activity than others; and the number of employees.

For risk managers, Ms. Morrow asserted, the bottom line is this: you may as well assume there is always going to be some degree of unwelcomed sexual behavior taking place. But by creating an atmosphere where employees feel they can complain and that the charge will be dealt with appropriately, "then 1 think that you have a very strong likelihood of being able to avoid a lawsuit."
COPYRIGHT 1993 Risk Management Society Publishing, Inc.
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Author:Kurland, Orin M.
Publication:Risk Management
Date:Apr 1, 1993
Words:1634
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