Great Policy; No Follow-Through

The best policy in the world won’t protect you without follow-through.

That’s the lesson of a decision by the Seventh Circuit  Court of Appeals  in a Wisconsin sexual harassment case, Equal Employment Opportunity Commission v. Management Hospitality of Racine, Inc., et al., No. 10-3247 (Jan. 9, 2012,).

The defendant, a company owned by Salauddin Janmohammed  which operates 21 International House of Pancakes restaurants, had a “zero-tolerance”  anti-harassment policy in place, anti-harassment training, and a policy of investigations of complaints.

What it didn’t have was follow-through. Or, in the words of the Court, “the policy and complaint mechanism were not reasonably effective in practice.”

According to the Court:  “the presence of a sexual harassment policy is encouraged by Title VII [but] the mere creation of a sexual harassment policy will not shield a company from its responsibility to actively prevent sexual harassment in the workplace.”

The Court upheld an award of $105,000 to two teenage servers at an IHOP operated by the defendant in Racine.  Katrina Shisler and Michelle Powell said they were sexually harassed in 2004 and 2005 by an IHOP assistant manager in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e et seq.

Normally, an employer can advance the so-called Faragher/Ellerth affirmative defense in a Title VII case sexual harassment claim involving a hostile work environment. This allows the employer to escape liability for damages if:

 (a) it “exercised reasonable care to prevent and correct promptly any sexually harassing behavior,” and

 (b) “the plaintiff employee unreasonably failed to take advantage of any protective or corrective opportunities provided by the employer or to avoid harm otherwise.”

The Court said the  Faragher/Ellerth affirmative defense was not available to the Management Hospitality because both teens had complained to managers about sexual harassment  and the managers did nothing.  The company did not begin investigating until a private investigator hired by an attorney for one of the teenager began asking questions.

The Court said a rational jury could have found that the sexual harassment occurred “every shift,”  was “highly offensive,” and included “physical touching.”

The Court said a rational jury also could conclude that the employer failed to follow its own policies by discouraging  employees from reporting complaints, providing inadequate anti-harassment training to supervisors, and failing to “promptly” investigate the complaints.

The EEOC filed suit on behalf of the two teenaged servers. A jury awarded one of the servers $1,000 in compensatory damages and the other $4,000 in compensatory damages and $100,000 in punitive damages.

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