Despite increased efforts to curb it, sexual harassment in the workplace hasn’t gone away. In fact, news reports of allegations of sexual harassment and lewd behavior lodged against media mogul Bill O’Reilly at Fox News and, separately, against transportation network company Uber, have shined a spotlight on the pervasiveness of sexual harassment in the workplace. As to O’Reilly, several complaints were raised and settled over several years by Fox News before the company asked O’Reilly to leave the network. With respect to Uber, the company allegedly swept “under the rug” several separate claims of sexual harassment made against a particular manager because the manager was a “high performer.” The sad truisms revealed by both the Uber and O’Reilly matters, clearly, are that money talks and rules can be bent (if not broken) for star performers. But there is a silver lining, as important lessons about the correction and prevention of sexual harassment in the workplace can be learned from these two publicly aired situations involving sex discrimination in the workplace.

What should be done when sexual harassment occurs in the workplace? First and foremost, the aggrieved employee (or whistleblower) should bring the improper behavior to the attention of the employer’s upper management, human resources or in-house legal department pursuant to a written grievance procedure. Upon receipt of notice of the claim, the employer should launch an investigation immediately (or as soon as reasonably practicable under the circumstances). Upon completing the investigation, the employer should take appropriate remedial action reasonably calculated to prevent further harassment. This approach serves two important purposes by concomitantly promoting a policy against sex discrimination in the workplace while insulating the employer from liability arising from such claims.

Most courts – at both the state and federal level in New York, New Jersey and Pennsylvania – agree that employers can avert legal exposure, thus creating a safe haven, by “exercising reasonably care to prevent and correct promptly any sexually harassing behavior.” This is accomplished by adopting an effective anti-harassment policy, properly training employees, implementing appropriate grievance procedures for the reporting and handling of claims of misconduct, conducting appropriate investigations, and by employing appropriate remedial measures when a claim of sexual harassment arises.  A general rule has been established that when employers have in place policies and procedures designed to address workplace discrimination and take remedial action in response to a complaint of discrimination, the employer may have protections from vicarious liability for the discriminatory actions of its employees.

In Cavuoti v. New Jersey Transit Corp., the Supreme Court of New Jersey expressed that “[a] company that develops policies reflecting a lack of tolerance for harassment will have less concern about hostile work environment or punitive damages claims if its good-faith attempts include periodic publication to workers of the employer’s anti-harassment policy; an effective and practical grievance process; and training sessions for workers, supervisors, and managers about how to recognize and eradicate unlawful harassment.”  The court went on to say that “a form of safe haven [exists] for employers who promulgate and support an active[] anti-harassment policy.”

This safe harbor protection afforded to employers that implement forceful anti-harassment policies and take prompt objective action in response to complaints of workplace discrimination makes sense. Employers who make a concerted effort to eliminate discrimination and sexual harassment in the workplace should be protected for their efforts, and not punished, particularly when prompt, remedial action is taken by the employer and the inappropriate behavior is mitigated.

This safe harbor, however, is not absolute. As the United States Court of Appeals for the Third Circuit held in Bouton v. BMW of North America, Inc., an employer may avoid liability only if its procedures for investigating and remediating alleged discrimination are sufficiently effective.  The affirmative defense cannot be asserted by employers who fail to implement effective anti-harassment policies (or where the policies exist in name only). In Gaines v. Bellino, the New Jersey Supreme Court held that an employer’s due care is demonstrated through effective grievance procedure, monitoring mechanisms, and through a showing of the employer’s commitment to its policies through consistent practice and implementation. Thus, the employer must engage in appropriate training and monitoring, which are indispensable to the affirmative defense. Additionally, the employer’s investigation must be appropriately conducted and the remedial action reasonably calculated to prevent further harassment. In Vasquez v. Empress Ambulance Service, Inc., the United States Court of Appeals for the Second Circuit reversed the dismissal of the plaintiff employee’s claims against the employer where the employer mishandled the investigation of the plaintiff’s claim of sexual harassment and ultimately terminated the plaintiff’s employment. Even where an employer implements appropriate policies and procedures, follows those procedures in the face of a hostile work environment complaint, promptly investigates and engages in what it believes is appropriate remedial action, as held by the Third Circuit in Knabe v. Boury Corp. – the employer nevertheless may be subject to liability where the investigation is “so flawed that it could not be said that the remedial action was adequate.”  In short, the investigation is not just worth doing, but it is worth doing the right way.

Many of these principles are promulgated by the United States Code of Federal Regulations. Title 29 of the Code of Federal Regulations, Section 1604.11, provides in relevant part:

  • “With respect to conduct between fellow employees, an employer is responsible for acts of sexual harassment in the workplace where the employer (or its agents or supervisory employees) knows or should have known of the conduct, unless it can show that it took immediate and appropriate corrective action.”
  • “An employer may also be responsible for the acts of non-employees, with respect to sexual harassment of employees in the workplace, where the employer (or its agents or supervisory employees) knows or should have known of the conduct and fails to take immediate and appropriate corrective action.” and
  • “Prevention is the best tool for the elimination of sexual harassment. An employer should take all steps necessary to prevent sexual harassment from occurring, such as affirmatively raising the subject, expressing strong disapproval, developing appropriate sanctions, informing employees of their right to raise and how to raise the issue of harassment under title VII, and developing methods to sensitize all concerned.”

In conclusion, an employer seeking to minimize liability arising from claims of sexual harassment in the workplace should: (1) adopt well-publicized anti-discrimination and anti-harassment policies; (2) implement grievance procedures in order to address claims of discrimination made by its employees; (3) regularly and properly educate and train its employees with respect to such policies and procedures; (4) conduct reasonably immediate, full and thorough investigations of any claims of sexual harassment or hostile work environment, regardless of whether the claim comes to light through the formal grievance procedure; and (5) take prompt, reasonable, necessary and appropriate remedial action with respect to each and every claim. By following these steps and appropriately addressing sexual harassment as it arises in the workplace, an employer can prevent future instances of improper workplace behavior and insulate itself from becoming the next Uber, Fox News or other newsworthy headline.