Employment Law Advisory Bulletin
RESPONDING TO HARASSMENT COMPLAINTS
Prompt Investigation but Ineffective Response Can Be Costly for
Employers
By Amy
Koziak and Mary
Drobka
[Nov. 2004]
The Washington State Court of Appeals recently
reaffirmed that an employer’s corrective action in response
to a harassment complaint must not only be prompt and adequate,
but effective. The Court of Appeals decision
affirmed a $500,000+ jury verdict for a Costco employee in a sexual
harassment case alleging hostile work environment claims under the
Washington Law Against Discrimination. Perry v. Costco Wholesale,
Inc.
Perry worked for Costco in its optical lab in Tukwila. Her alleged
harasser, Smith, was a non-supervisory co-worker who was also friends
with her husband, another Costco employee. According to Perry, Smith
began to make inappropriate sexual comments and gestures after her
husband transferred to another location. Perry admitted not immediately
reporting these allegations to Costco. At some later point, Smith
exposed himself to Perry in the parking lot, insinuating that they
should engage in sexual conduct and causing her to feel physically
threatened. Perry again did not report this to Costco or anyone
else because she feared that her husband might physically assault
Smith. Two or three months later, however, she finally told her
husband, and then immediately reported it to her shift supervisors
at Costco.
Costco conducted a prompt investigation, interviewing Perry, the
other women who allegedly experienced similar behavior, and Smith.
Smith was suspended for three days during the investigation. Some
of Perry’s co-workers confirmed her allegations, and in addition,
reported experiencing the same type of harassment from Smith. Smith
denied all allegations. The supervisor of the Tukwila lab found
Perry credible and recommended terminating Smith. However, after
completing their investigation, Costco management concluded that
Perry’s complaints could not be verified. Smith was transferred
from the night to the day shift and required to attend three hours
of “sensitivity training.” Perry disputed the results
of the investigation and requested a transfer out of the Tukwila
optical lab, which Costco denied. When Perry complained that at
times her shift overlapped with her alleged harasser, Costco suggested
that she begin her shift late and reduce her hours (effectively
reducing her pay). Perry finally used the internal job posting process
to find herself another position and transfer to Costco’s
Federal Way warehouse. While working at Federal Way, Perry reported
to management that Smith continued to bother her at work. Costco
confirmed Smith was coming on site, making insignificant purchases,
and also glaring at Perry. Costco simply informed Perry to “stay
away from him” and advised her there was nothing the company
could do to keep him away from her.
The Court found that “once an employer has actual knowledge
through higher managerial or supervisory personnel of a complaint
of sexual harassment, then the employer must take remedial action
that is reasonably calculated to end the harassment.”
Applying the Ninth Circuit standard for Title VII cases, the Court
held that the employer’s actions should “persuade the
individual harassers to discontinue unlawful conduct,” and
“impose sufficient penalties to assure a workplace free from
sexual harassment.” In evaluating whether an employer’s
response is effective, the Court of Appeals held that it will evaluate
the likelihood that the employer’s remedy would stop a harasser
in the future and deter future harassment by other offenders. Although
the Court of Appeals found Costco’s actions to be prompt,
the Court concluded that Costco’s remedial response was not
effective. The Court found that there was credible evidence
that the harassment had occurred, and Costco’s refusal to
transfer Perry out of the warehouse and its subsequent reaction
to Perry’s continuing problems failed to end the harassment.
In addition, neither the sensitivity training nor the transfer of
Smith to the more desirable day shift deterred Smith or others from
acting inappropriately with other employees. Finally, the Court
criticized Costco for not offering counseling to Perry, particularly
given the evidence that some harassment did occur.
Lessons Learned
This decision contains an extensive analysis of both an employer’s
chosen discipline for an accused harasser and an employer’s
treatment of a complainant post-investigation. The Court not only
questioned the adequacy of a three-day suspension where the investigation
uncovered multiple women who experienced similar behavior by the
harasser, but also Costco’s refusal to help Perry transfer
from the Tukwila location where her harasser continued to work.
The Court also questioned whether a transfer of a harasser from
the night to the day shift qualified as discipline, particularly
when co-workers perceived this as a more desirable shift and reported
that he was happy with the change. Finally, the Court of Appeals
noted that Costco inexcusably failed to address Perry’s concerns
about the harasser’s continued visits to her new work site,
after she transferred to a different store.
Key lessons that employers should take away from this case:
- Employers must be vigilant not only in promptly and thoroughly
investigating harassment claims, but also in designing effective
remedies and imposing disciplinary action that will end harassment
in the workplace.
- At a minimum, employers should try to resolve credibility issues
after careful consideration. Even though it may be difficult,
employers should make good faith determinations about what actually
occurred even though presented with differing or conflicting versions
of events.
- If higher management disregards the proposed recommendation
of the investigator, or the complainant’s immediate supervisor
or manager, the employer should be able to articulate defensible
reasons for rejecting the recommendations of those closest to
the situation.
- If the complaints are deemed credible, employers should listen
to the complainant, ask him or her for proposed resolutions, and
carefully consider the complainant’s suggested resolutions.
Even if not proposed, employers should explore offering counseling
to harassment complainants (including paying for the counseling
if it is not covered by insurance).
- When imposing discipline short of termination on a harasser,
employers should carefully evaluate whether the chosen “discipline”
could be perceived by others as advantageous or ineffective. For
example, transferring the harasser to another shift or work site
(and leaving the complainant status quo) should not be viewed
as a more desirable outcome by the harasser or co-workers. Employers
may need to err on the side of imposing more rigorous remedial
action, given that this Court implicitly held that if the harassment
reoccurs, it was by definition not effective.
- Employers must be proactive in following up with complainants
to ensure that the harassment is not reoccurring, that discipline
was effective, and that it has not caused any real or perceived
negative consequences for the complainant. If the complainant
does raise additional concerns, human resources must promptly
investigate the new allegations to evaluate whether the original
resolution was truly effective or if retaliation has occurred.
If policy violations are continuing, additional discipline needs
to be considered, including the harasser’s termination.
Any questions about this Advisory should be directed
to:
This
Employment Law Advisory is a publication of the Employer Services
Department of Davis Wright Tremaine LLP. Our purpose in publishing
this Advisory is to inform our clients and friends of recent developments
in employment law. It is not intended, nor should it be used, as
a substitute for specific legal advice as legal counsel may only
be given in response to inquiries regarding particular situations.
Copyright
© 2004, Davis Wright Tremaine LLP.
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