{"id":37337,"date":"2016-03-31T19:25:18","date_gmt":"2016-04-01T00:25:18","guid":{"rendered":"https:\/\/content.findlaw-admin.com\/ability-legal\/uncategorized\/one-sexual-harassment-law-suit-can-devastate-even-the-largest.html"},"modified":"2016-07-27T16:24:25","modified_gmt":"2016-07-27T21:24:25","slug":"one-sexual-harassment-law-suit-can-devastate-even-the-largest","status":"publish","type":"corporate","link":"https:\/\/corporate.findlaw.com\/litigation-disputes\/one-sexual-harassment-law-suit-can-devastate-even-the-largest.html","title":{"rendered":"Sexual Harassment and Corporate Liability"},"content":{"rendered":"<section class=\"fl-gutenberg-byline\">\n    <div class=\"fl-gutenberg-byline-content\">\n                    <p><em>This article was edited and reviewed by <a href=\"https:\/\/www.findlaw.com\/company\/our-team.html\" rel=\"noopener\">FindLaw Attorney Writers<\/a><\/em><\/p>\n\n                | Last reviewed\n        <time>\n                            May 21, 2026\n                    <\/time>\n    <\/div>\n\n    \n    <details class=\"fl-gutenberg-byline-toggle fl-gutenberg-byline-legally-reviewed\">\n        <summary>\n            <i class=\"fl-gutenberg-byline-icon\" aria-hidden=\"true\"><\/i>\n            Legally Reviewed\n        <\/summary>\n\n        <div class=\"fl-gutenberg-byline-toggle-content\">\n            <p><em>This article has been written and reviewed for legal accuracy, clarity, and style by <a href=\"https:\/\/www.findlaw.com\/company\/our-team.html\" rel=\"noopener\">FindLaw\u2019s team of legal writers and attorneys<\/a> and in accordance with <a href=\"https:\/\/www.findlaw.com\/company\/company-history\/editorial-policy.html\" rel=\"noopener\">our editorial standards<\/a>.<\/em><\/p>\n\n        <\/div>\n    <\/details>\n\n    <details class=\"fl-gutenberg-byline-toggle fl-gutenberg-byline-fast-checked\">\n        <summary>\n            <i class=\"fl-gutenberg-byline-icon\" aria-hidden=\"true\"><\/i>\n            Fact-Checked\n        <\/summary>\n\n        <div class=\"fl-gutenberg-byline-toggle-content\">\n            <p><em>The last updated date refers to the last time this article was reviewed by FindLaw or one of our <a href=\"https:\/\/www.findlaw.com\/company\/our-team\/contributing-authors.html\" rel=\"noopener\">contributing authors<\/a>. We make every effort to keep our articles updated. For information regarding a specific legal issue affecting you, please <a href=\"https:\/\/lawyers.findlaw.com\/?fli=bylinelink\" rel=\"noopener\">contact an attorney in your area<\/a>.<\/em><\/p>\n\n        <\/div>\n    <\/details>\n<\/section>\n\n\n\n<p>Having sexual harassment policies in place is no guaranty that your clients or their employees are adequately protected. After all, many businesses still make <a href=\"http:\/\/www.americanbar.org\/newsletter\/publications\/law_trends_news_practice_area_e_newsletter_home\/business_kow.html\" title=\"American Bar Association, &quot;Avoid Putting Your Company at Risk: The Top Ten Employer Mistakes When Investigating Employee Harassment and Discrimination Complaints&quot;\" rel=\"noopener\">common mistakes<\/a> particularly when it comes to investigating claims of harassment and discrimination. For example, they may fail to maintain confidentiality to remind parties about policies regarding retaliation. <\/p>\n<p>If you represent corporate clients, it&#8217;s important to ensure that their policies, both in writing and in practice, sufficiently protect their employees and reduce risks of liability. This is especially important considering the prospect of <a href=\"https:\/\/www.eeoc.gov\/eeoc\/newsroom\/release\/5-1-13a.cfm\" title=\"U.S. Equal Employment Opportunity Commission, &quot;EEOC Wins Jury Verdict of More than $20 Million for Sexual Harassment and Retaliation&quot;\" rel=\"noopener\">multi-million dollar verdicts<\/a>. Read on to learn more about sexual harassment in the corporate workplace and ways to protect your clients.<\/p>\n<p><b>What&#8217;s the Law on Sexual Harassment?<\/b><\/p>\n<p>While there may be applicable state laws in your client&#8217;s jurisdiction (e.g. wrongful termination laws), if your client or company has 15 or more employees, it will also be subject to <a href=\"https:\/\/www.eeoc.gov\/employees\/coverage.cfm\" title=\"U.S. Equal Employment Opportunity Commission, &quot;Coverage&quot;\" rel=\"noopener\">EEOC enforcement under Title VII<\/a>. EEOC complaints normally involve a formal investigation and findings and could also lead to a federal lawsuit being filed by an employee or by the EEOC itself.<\/p>\n<p>Generally, to succeed on a federal claim of sexual harassment, an employee must show:<\/p>\n<ol>\n<li>Unwelcome harassment of a sexual nature,<\/li>\n<li>That the harassment affected a term, condition or privilege of employment, and<\/li>\n<li>A basis for employer liability.<\/li>\n<\/ol>\n<p>There are primarily two types of sexual harassment cases depending on whether the employee experienced any resulting tangible employment actions such as termination, failure to promote or hire, reassignment, or lost wages. In these cases, employers are automatically liable for sexual harassment. However, in cases where no tangible employment action exists, an employee can still sue for creation of a hostile work environment in which case an employer is liable, unless:<\/p>\n<ul>\n<li>It took reasonable and prompt action to prevent and correct harassing behavior, and<\/li>\n<li>The employee unreasonably failed to utilize preventive or corrective opportunities<\/li>\n<\/ul>\n<p>Employees can also make a claim for retaliation if they experience adverse treatment related to their complaint. Successful complaints can lead to recovery of lost wages, punitive damages, attorney&#8217;s fees, and other job-related losses. It can also result in reinstatement or promotion as well as an order requiring an employer to develop more comprehensive sexual harassment policies.<\/p>\n<p><b>Mitigating Corporate Liability<\/b><\/p>\n<p>Upon receiving a complaint of sexual harassment, an employer should promptly investigate and take reasonable actions. Regarding the offender, this can include:<\/p>\n<ul>\n<li>Oral or written warning or reprimand<\/li>\n<li>Transfer or reassignment<\/li>\n<li>Demotion<\/li>\n<li>Reduction of wages<\/li>\n<li>Suspension<\/li>\n<li>Discharge<\/li>\n<li>Training or counseling<\/li>\n<li>Ongoing monitoring<\/li>\n<\/ul>\n<p>Employers can also take actions to address the harm to the victim, such as:<\/p>\n<ul>\n<li>Restoration of leave taken due to harassment<\/li>\n<li>Removal of negative evaluations associated with the harassment<\/li>\n<li>Reinstatement<\/li>\n<li>Apology by the harasser<\/li>\n<li>Monitoring to ensure no retaliation<\/li>\n<li>Correction of other harassment-related harm, which may include further compensation for losses<\/li>\n<\/ul>\n<p><b>Corporate Liability for Third Parties<\/b><\/p>\n<p>There are situations when employees are sexually harassed by customers or other third parties rather than by other employees. This is often referred to as third party sexual harassment and can lead to employer liability. As an example, <a href=\"https:\/\/www.gpo.gov\/fdsys\/pkg\/USCOURTS-ca4-10-01476\/pdf\/USCOURTS-ca4-10-01476-0.pdf\" title=\"Government Publishing Office, Unpublished Opinion, EEOC v. Cromer Food Services\" rel=\"noopener\">a case in 2011<\/a> involved the employee of a vending machine company who was sexually harassed by hospital employees when stocking machines. In that case, the Fourth Circuit determined that the vending machine company could be held liable <a href=\"https:\/\/www.eeoc.gov\/eeoc\/litigation\/reports\/11annrpt.cfm\" title=\"U.S. Equal Employment Opportunity Commission, &quot;Office of General Counsel Fiscal Year 2011 Annual Report&quot;\" rel=\"noopener\">under a negligence standard<\/a> for the actions of non-employees.<\/p>\n<p>In addition to the growing case law on third party sexual harassment, there&#8217;s also a <a href=\"http:\/\/www.ecfr.gov\/cgi-bin\/text-idx?node=se29.4.1604_111&amp;rgn=div8\" title=\"29 C.F.R. \u00a7 1604.11(e)\" rel=\"noopener\">federal regulation directly on point<\/a> stating that employers can be responsible for the acts of non-employees if they:<\/p>\n<ul>\n<li>Know or should know of the harassment, and<\/li>\n<li>Fail to take immediate and appropriate action.<\/li>\n<\/ul>\n<p>If third parties are creating hostile work environments for your client or company, you and your client should still take prompt action to remedy the situation. In these situations, employers should investigate the complaint as if the offender were an employee and take reasonable steps to protect their employees, even if it may harm business relationships. After all, the cost of keeping a harassing customer may be a multi-million dollar jury verdict.<\/p>\n<p><b>Further Resources<\/b><\/p>\n<p>For more information on prevention strategies, see the EEOC&#8217;s <a href=\"https:\/\/www.eeoc.gov\/policy\/docs\/harassment.pdf\" title=\"U.S. Equal Employment Opportunity Commission, &quot;Enforcement Guidance, Vicarious Employer Liability for Unlawful Harassment by Supervisors&quot;\" rel=\"noopener\">guidance for employers<\/a> as well as FindLaw&#8217;s article, <a href=\"https:\/\/corporate.findlaw.com\/human-resources\/sexual-harassment-an-ounce-of-corporate-prevention.html\" title=\"FindLaw, &quot;Sexual Harassment: An Ounce of Corporate Prevention&quot;\">on corporate prevention of sexual harassment<\/a>. For more information on the investigation of sexual harassment complaints, see FindLaw&#8217;s article on <a href=\"https:\/\/corporate.findlaw.com\/human-resources\/this-investigation-of-sexual-harassment-complaints.html\" title=\"FindLaw, &quot;The Investigation of Sexual Harassment Complaints&quot;\">investigation of sexual harassment complaints<\/a>. Also, to help inform your clients about the increasing risks of sexual harassment through social media, see the EEOC&#8217;s <a href=\"https:\/\/www.eeoc.gov\/eeoc\/newsroom\/release\/3-12-14.cfm\" title=\"Equal Employment Opportunity Commission, &quot;Social Media is Part of Today&#039;s Workplace but its Use May Raise Employment Discrimination Concerns&quot;\" rel=\"noopener\">additional guidance regarding social media<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Having sexual harassment policies in place is no guaranty that your clients or their employees are adequately protected. After all, many businesses still make <a title=\"American Bar Association, &quot;Avoid Putting Your Company at Risk: The Top Ten Employer Mistakes When Investigating Employee Harassment and Discrimination Complaints&quot;\" href=\"http:\/\/www.americanbar.org\/newsletter\/publications\/law_trends_news_practice_area_e_newsletter_home\/business_kow.html\">common mistakes<\/a> particularly when it comes to investigating claims of harassment and discrimination. For example, they may fail to maintain confidentiality to remind parties about policies regarding retaliation. If you represent corporate clients, it&#8217;s important to ensure that their policies, both in writing and in practice, sufficiently protect their employees and reduce risks of liability. This is especially important considering the prospect of <a title=\"U.S. Equal Employment Opportunity Commission, &quot;EEOC Wins Jury Verdict of More than $20 Million for Sexual Harassment and Retaliation&quot;\" href=\"https:\/\/www.eeoc.gov\/eeoc\/newsroom\/release\/5-1-13a.cfm\">multi-million dollar verdicts<\/a>. Read on to learn more about sexual harassment in the corporate workplace and ways to protect your clients.<\/p>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_categories":[6522,6526,6520],"class_list":["post-37337","corporate","type-corporate","status-publish","hentry","corporate_categories-litigation-disputes__civil-litigation","corporate_categories-litigation-disputes__civil-litigation__civil-rights","corporate_categories-litigation-disputes"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate\/37337","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=37337"}],"wp:term":[{"taxonomy":"corporate_categories","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_categories?post=37337"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}