Is a Flood of Sexual Harassment Litigation About to Hit Small Business?

Sexual harassment at work

Allegations will soon surface in businesses of every size in every industry

No industry is immune from the types of sexual harassment complaints currently piling up against entertainment celebrities and political figures. It’s quite clear that women in the workforce are no longer willing to tolerate a culture of sexual intimidation.

The high-profile allegations against such heavy hitters as Harvey Weinstein, Matt Lauer and Sen. John Conyers are giving women in other industries the courage to come forward, too. There will undoubtedly be trickle down from these high-profile cases into smaller businesses.

Ironically, the harassment allegations appearing in almost daily news reports defy a recent trend. There has been a continual decline since 2010 in the  number of sexual harassment charges filed with the Equal Employment Opportunity Commission.

Leaders set the tone

Reducing the potential for incidents of sexual harassment in your company begins at the top. Other executives at Harvey Weinstein’s company and NBC’s Today Show had to know what was going on, whether directly or through rumors. There’s ample reason to believe that the ostrich syndrome is a significant problem in the upper management of many companies.

Your star employees who meet financial goals or grow your business cannot be immune from the consequences of unacceptable behavior. Business owners and board members need to know they may be held personally liable for claims of sexual harassment against their employees. And private organizations can be sued by shareholders and others.

One red flag board members need to recognize is large or unusual checks going out. Is someone being paid to keep silent? If a satisfactory answer isn’t forthcoming, investigate the issue further.

Setting up a sexually safe workplace

The first step is to recognize the cultural issue of predatory advances, especially the intimidation factor. Take rumors and allegations seriously. The message must be clear that inappropriate behavior in the work environment won’t be tolerated.

Create a well-defined written sexual harassment policy that includes procedures for complaints and investigations. Make it clear that the policy pertains to all employees, including company leaders. Strict enforcement of the policy and procedures drastically reduce the potential of sexual harassment claims.

All employees need training in accepted behavior and the policies and procedures you establish.

Some businesses might want to consider adopting Vice President Mike Pence’s personal policy. He never dines alone with a woman or attends an event where alcohol is served unless accompanied by his wife. 

Unfortunately, negative fallout could result from these recent celebrity cases. False allegations are always a concern.  Fear of misinterpreted behavior or false allegations might result in men being less willing to mentor or work one-on-one with women. But many of these mentoring meetings take place outside the workplace, in environments ripe for unwanted advances and away from observers.

One more element of protection

An Employment Practices Liability insurance policy is a must. These policies are affordable and protect against allegations of employment-based discrimination based on race, sex, age or handicap, sexual harassment and wrongful termination or discipline. An EPLI policy can be purchased either on a stand alone basis or combined with a Management Liability policy (ADA Directors & Officers Liability policy).

Please contact Sadler & Company if you are interested in a quote by completing the get quote form or calling our commercial insurance department at 800-622-7370.

Source: Judy Greenwald. “Harassment claims set to increase.” 06 Nov. 2017
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