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Recent Legal Actions Illustrate Importance of Sexual Harassment Prevention Policies

A California judge in May 2022 approved an $18 million settlement between video-game giant Activision Blizzard and the U.S. Equal Employment Opportunity Commission after the federal agency accused the company of subjecting employees to severe sexual harassment and pregnancy discrimination, and that it engaged in retaliation against employees who complained.

A few months earlier Tesla was sued by six women, who described a culture of sexual harassment that included unwanted touching, catcalls and retaliation against those who complained. And recently 15 women interviewed by the Financial Times accused Apple Inc. of giving short shrift to their complaints of sexual harassment.

While these are all large companies, it’s mostly small and mid-sized companies that are sued for sexual harassment and the legal fees, settlements or court judgments can be so high that they imperil the very future of the businesses concerned.

But the headline-making cases do hold some value: They give other companies a roadmap of what not to do if they receive complaints of sexual harassment and discrimination.

The common thread in these cases is that the companies allegedly ignored or downplayed reports made by their employees, and some allegedly threatened complaining employees with firing, a demotion or transfer.

It’s important that you have in place a strong sexual harassment prevention policy and a system in place for reporting incidents. You should also have procedures for handling complaints.

If harassment does occur, you must take effective action to stop any repetition and correct any effects of the harassment. You also need to train your employees in your policies and your zero-tolerance policy.

Your legal requirements

All California employers with five or more workers must conduct two hours of sexual harassment prevention training to all supervisors and one hour of training to all non-supervisor staff six months after being hired, and every two years after that.

The state requires that the training include the following:

  • Information and practical guidance regarding federal and state law concerning the prohibition against, and the prevention and correction of, sexual harassment and the remedies available to victims of such harassment.
  • Practical examples of harassment, discrimination and retaliation.
  • Information about preventing abusive conduct and harassment based on sexual orientation, gender identity and gender expression.
  • Procedures for employees to file a complaint of sexual harassment, as well as the company’s steps for dealing with complaints.
  • Appropriate remedial steps to correct harassing behavior, including the employer’s obligation to effectively investigate harassment.

The law also requires you to have in place a written sexual harassment prevention policy that must also be distributed to your staff. You are also required to post sexual harassment prevention posters in the workplace.

You should approach workplace harassment prevention with extreme care to reduce the risk of lawsuits, agency charges and penalties, and other fallout. Not only is training employees on sexual harassment in the workplace required by California employment law, but it is also the key to reducing the chances of an incident occurring.

If you are sued

Despite all of your training and policies, you can still be sued by an employee who alleges sexual harassment. And even if the allegations are false, you’d still be on the hook for paying to defend against them.

The best way to avoid this circumstance is to purchase employment practices liability insurance, which may pay for defense costs, settlements and judgments in cases where an employee sues you over workplace infractions.

Contact us for more information on the best coverage for your specific business operation.