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How to Minimize Lawsuits for Discrimination and Harassment

By Efrain H. Logreira

Dealing with employee issues is a tough task for business owners and managers. Responding to accusations of harassment, including sexual harassment is one of the most sensitive and serious challenges they'll ever face. But owners and managers must pay close attention in order to limit costly lawsuits that could potentially destroy a small business. A little prevention can go a long way to protect the health of a business.

Discrimination and Harassment, including sexual harassment lawsuits show no sign of slowing down and workers continue to win multimillion-dollar damage awards as juries determine that employers didn’t do enough to prevent inappropriate conduct in the workplace.

"According to Federal law, employers can be responsible for discriminatory conduct occurring in their workplace, whether he or she had actual knowledge of it or not, if the conduct involves a supervisor or the employer had reason to know about the behavior," warns Carol Hastings, vice president of Corte Hispana, a Santa Monica company that produces English and Spanish harassment prevention training materials and offers on-site training in both languages. "The Supreme Court has ruled that employee lawsuits will succeed if an employer fails to take steps to prevent all types of harassment - even if no tangible job detriment results such as firing, hiring or demoting." Hastings notes.

The High Price For Ignoring Harassment

"Federal law under Title VII of the Civil Rights Act, which is enforced by The Equal Employment Opportunity Commission (EEOC) has established a range of possible damage awards, depending upon the size of employer," explains Zinnia Barrero, a bilingual-Spanish employment attorney, who specializes in harassment prevention training and mediation. "According to Title VII companies with 15 to 100 employees can be liable for a maximum of $50,000 in compensatory or punitive damages; 101 to 200 employees, $100,000; 201 to 500, $200,000; and more than 500, $300,000 if found liable by a judge or jury. Those figures don't include legal fees or separate awards for back pay or prejudgment interest."

The national average for the cost of defending a discrimination lawsuit through trial is approximately $300,000 and punitive damages awards average $274,000. In California, the Department of Fair Employment and Housing Commission (DFEH), can order up to $150,000 in damages for emotional distress from each employer or harasser charged, not including attorney’s fees. More significant is that, unlike federal law, California law does not place a cap on damages for discrimination or harassment. This means that a potential jury award is unlimited in California and could easily bankrupt a small or medium sized employer.

Which Employers Must Comply With These Laws?

The guidelines imposed by Title VII, provide that the discrimination and harassment laws cover all companies with 15 or more employees, who work 20 or more weeks per year. In California, employers with only one employee can be held liable for harassment.

What is Considered Harassing Behavior?

According to the DFEH, the three most common types of harassment and sexual harassment complaints filed are those in which:

• An employee is fired or denied a job or an employment benefit because he/she refused to grant sexual favors or because he/she complained about harassment. Retaliation for complaining about harassment is illegal, even if it cannot be demonstrated that the harassment actually occurred.
• An employee quits because he/she can no longer tolerate an offensive work environment. 
• An employee is exposed to an offensive work environment. Exposure to various kinds of behavior or to unwanted sexual advances alone may constitute harassment.

Education and Prevention are the Best Defense

There are some simple steps business owners can take to combat the threat of discrimination and harassment litigation. A program to educate employees in harassment prevention is the most practical way to avoid or limit liability. Your prevention program should include the following:

• Have an anti-harassment policy. A written Company policy on discrimination and harassment, including sexual harassment needs to be implemented.
• Communicate your policy to your employees. Not educating your employees regarding the policy is the same as not having one. All employees should be aware of the seriousness of policy violations.
• Train your supervisors. Supervisory personnel need to know how to comply with your harassment policy and how to recognize harassment. They need to understand that they may be held personally liable if they harass subordinates. 
• Investigate complaints promptly. Any time an employee says he or she is being harassed, take the complaint seriously and investigate it immediately. 
• Prevent retaliation. Make sure not to allow retaliation against the employee making the complaint.
• Do all you can to create a non-hostile work environment. Stress the importance of mutual respect and stipulate that harassing behavior will not be tolerated.

Employers with multicultural work forces are especially vulnerable to frictions in the workplace, employee relations issues, and challenges in enforcing federal and state laws. Many times language differences or lack of experience with U.S. laws can turn misunderstandings into major morale and legal issues.


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