By Mark B. Stumer, Esq.
With all the media attention on the subject lately, the number of sexual harassment cases filed each year against bars and their owners are escalating at an all too rapid pace. As an attorney, I am often called after-the-fact (i.e. “I’ve been served with a sexual harassment lawsuit. What do I do now?”). The goal of this article is to eliminate or substantially reduce the risk of you and/or your bar being sued for sexual harassment.
These lawsuits often take a severe financial and personal toll on the bar and its owners. The average court verdict for a sexual harassment plaintiff is $350,000.00 (this does not include defense costs or any intangible costs the employer incurs as a result of bad publicity, embarrassment and diminished productivity). I’ve even seen a few marriages end as a direct result of sexual harassment lawsuits. The average cost of legal fees to defend a sexual harassment lawsuit is $150,000.00. Additionally, sexual harassment laws typically provide for fee shifting to the Plaintiff if they win the case. Thus, in addition to your legal fees, you will also be responsible for the plaintiff’s legal fees if they win.
Let’s first clarify what it is. A series of Supreme Court decisions have defined what “sexual harassment” now means. Those cases, and the interpretive guidelines of the Equal Employment Opportunity (EEOC), define two distinct types of sexual harassment:
· Quid Pro Quo (a legal term meaning “this for that”), which occurs when a beneficial condition of employment is premised upon an employee’s submission to sexual advances. This claim is typically asserted when an employee rejects a sexual advance, and then claims a connection between that rejection and a subsequent adverse job action (such as a denial of a raise or promotion, loss of shifts, pay cut, demotion, suspension, termination, or a “constructive discharge” where an employee claims that the conduct made his or her job conditions so intolerable that they were forced to quit); and
· Hostile Environment, in which a supervisor or employee creates a work environment through sexually related verbal or physical conduct that sufficiently alters an employee’s working conditions or creates an intimidating or sexually charged work environment. A hostile environment is created when unwelcome sexually related behavior occurs. For example, an unwanted touching or groping, an employee makes comments or tells jokes of a sexual nature after knowing that such comments or jokes are unwelcome or when one employee keeps asking another employee for dates after being refused. Generally, repeated conduct is required to prove a hostile work environment, and a “stray comment” has been held not to alter the working conditions sufficiently to create a cause of action. However, some comments or conduct can be so severe that a single incident can create liability. Hostile environment claims are far more common than quid pro quo.
As an owner, there are steps that are preventative measures that can and should be taken:
1. Prepare and Distribute a Written Sexual Harassment Policy: Assuming that your managers and employees know how to behave without explicit guidelines could be your ticket to the courthouse. A written sexual harassment policy will specify exactly what behavior is prohibited and will further provide for an internal complaint procedure for the employee that believes they have been sexually harassed. The complaint procedure should require that the employee complain in writing to a specific person (also naming an alternate choice in the event the first named is the alleged harasser) within a specified time period (usually within 14 business days from the harassing incident). It is critical that the policy protect complainants and witnesses from any retaliation from any source as a result of initiating or supporting a sexual harassment allegation. The employee will sign a “receipt” for this policy acknowledging that they have read it, that they fully understand it, and that they agree to abide by terms and conditions contained it. The policy should be distributed to all existing staff and provided to all new hires.
It is important not to become complacent with any existing policy as the sexual harassment laws and the interpretations of the laws are frequently being amended by legislation and re-interpreted by litigation. As such, the policy should be reviewed by qualified legal counsel on a yearly basis to ensure compliance with the always evolving body of case law.
The importance of this policy cannot be overstated. It not only serves to educate the staff as to what conduct is prohibited but could also serve to insulate the bar and its owner from liability if the alleged victim fails to complain in accordance with the complaint procedure stated in the policy. It also permits the owner to quickly launch an investigation into the allegations, put an immediate end to any ongoing harassment, and take prompt remedial measures against the harasser in the event that the allegations are substantiated.
2. Educate All Staff: Even given the use of a detailed sexual harassment policy, all current staff and new hires should be regularly trained (at least once per year) with regards to sexual harassment prevention. This training should be done by a qualified attorney. I know that attorneys aren’t cheap (the training with materials should cost you about $1,500.00) but the potential benefits of this training will far outweigh the costs.
3. Promptly and Properly Investigate ALL complaints of sexual Harassment. All internal complaints of sexual harassment must be investigated . . .even the ones that don’t appear to be serious. The investigation should be designed to obtain a prompt and thorough collection of the facts, an appropriate responsive action, and an expeditious report to the complainant that the investigation has been concluded, and, to the full extent appropriate, the action taken.
If the investigation reveals that there was in fact sexual harassment, appropriate action must be taken against the harasser. Appropriate action will vary and should be determined on a case by case basis but can include removal of harasser from all interaction with the complainant, demotion, removal of shifts, suspension and/or termination of the harasser. Be sure not to transfer or otherwise change the employment terms of the complainant in any way as a result of their complaint. For example, unless specifically requested by the complainant in writing, do not change the shift schedule of the complainant in response to a complaint. You may be doing so to simply separate them from the harasser but that shift change may be viewed as retaliation for their complaint and would give rise to separate cause of action against you and the bar for retaliation even if they did not experience any sexual harassment in the first place.
At the conclusion of the investigation, it is prudent to inform the complainant in writing of the results of the investigation and action taken against the harasser, if any.
In the hospitality industry, bar owners must constantly balance between having a friendly and cordial work environment and one that is legally prohibited. Properly utilizing the above three preventative measures will help ensure that the bar and its owners are doing what they can to minimize their exposure and liability to sexual harassment lawsuits.
Mark B. Stumer, Esq. is an attorney licensed to practice law in New York and is the founder of the law firm Mark B. Stumer & Associates, PC. He and his law firm have been representing bars, restaurants and nightclubs in New York since 1995. [email protected]
