Sexual Harassment: What We Learned in 2017

December 18, 2017

The scandal involving Harvey Weinstein and his company continues to make news, leaving most people wondering how sexual misconduct of this magnitude went unchecked for so long.

The Weinstein Company is no doubt asking itself yet another serious question: Is the company liable for Harvey Weinstein’s actions?

In short, yes . . . and it relates to how long his egregious conduct was permitted to continue.

The company (through the knowledge of its board members) knew these facts:

  1. Harvey Weinstein was known to be a womanizer.
  2. He had been accused of groping a model, but criminal charges were never brought.
  3. The Human Resources Department was denied access to his personnel file, despite criminal allegations against him.
  4. Employee complaints about Harvey Weinstein’s past sexual harassment/misconduct were common knowledge.
  5. His lawyers addressed most of the requests for information about complaints and settlements.
  6. The Human Resources Department did not conduct or order independent investigations into those complaints.
  7. Despite extensive evidence and the knowledge of multiple, confidential settlements between Harvey Weinstein and various women, Mr. Weinstein’s employment contract was renewed in 2015. A clause was added requiring him to repay the company if it was sued for his misconduct (including sexual harassment). Essentially, as long as he paid up, he was free to misbehave.

The allegations continue to pour in, implicating Weinstein’s connection to the company, harming its reputation, calling the company’s actions into question, and exposing it to liability. Had the company investigated the allegations, and if corroborated, fired Harvey Weinstein, it would have mitigated its risk.

What should you do?

  • Take every complaint of sexual harassment/misconduct seriously.
  • Conduct an independent investigation of all complaints to determine their validity.
  • Determine if company policies have been violated, even if the parties involved reach a settlement.
  • Consistently discipline policy violators, regardless of their status, role, performance, or ownership interest.
  • Strictly enforce anti-retaliation policies and ensure employees and third parties feel comfortable reporting their concerns.
  • When it comes to employee complaints, use confidentiality agreements and NDAs sparingly. They do notreduce company or decision-maker liability regarding future incidents if past incidents have been ignored.
  • Investigate all suspicious matters. When it comes to the actions of employees, there is nothing beyond Human Resources’ jurisdiction. A refusal to permit the Human Resources Department to review any records relating to an employee is highly suspect.

Companies can no longer bury their heads in the sand when it comes to sexual harassment. These complaints must be taken seriously and investigated — no matter how innocuous a complaint may seem.

As part of your Employment Practices Liability coverage (EPLI), TMLT policyholders have access to information on employment and human resources issues through EPLI Pro.

EPLI Pro contains summaries of state and federal law, training materials, and step-by-step procedures for HR tasks. EPLI Pro also offers webinars, workforce training, and information on creating staff handbooks and policies and procedures. (Please log in to myTMLT, our members-only portal, to access ELPI Pro.)

Reprinted from ePlace Solutions. ePlace Protect Newsletter. December 2017.

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