EECO takes aim at contractors for increased violations

By Randy Bonnecaze

In recent years, sexual harassment claims have dramatically increased in many industries. But construction has been especially hard hit. In response, the Equal Employment Opportunity Commission (EEOC), a federal agency that enforces federal employment discrimination laws, has chosen to target the construction industry for sexual harassment violations.

It wants to send a strong message to construction company owners and their employees that the EEOC will not tolerate such workplace harassment.

Your first reaction to sexual harassment may be to put your head in the sand and hope none of your employees ever files a claim. After all, it's an issue wrought with awkwardness, ambiguity and animosity. But don't take this risk. Let's review the definitions of sexual harassment and how to protect your company.

Primary types. Knowledge is indeed power when trying to avoid sexual harassment liability. To that end, you need to understand the two types of harassment as defined by the courts:

Quid pro quo. This is sexual harassment in which a "power" relationship exists and the perpetrator demands sexual advances or favors that the victim neither wants nor welcomes. Along with these demands, threats of detrimental job-related consequences may also occur.

Bear in mind, the threat of adverse consequences needn't actually be carried out, nor does any direct threat of physical harm. Quid pro quo harassment poses the greatest liability risk. If a victimized employee can prove these claims true, the courts will always hold the employer liable.

Hostile work environment. Here the environment in which the employee works is intimidating, hostile or offensive because of sexually explicit or other bad behavior. Unlike quid pro quo harassment, the offensive actions needn't come from a supervisor or someone in a powerful position. And this type of harassment isn't necessarily intended to discriminate against or harm the employee. In fact, some accused harassers don't believe their actions are harmful, but rather cute and funny.

Nonetheless, under today's legal standards, what the harasser thinks, believes or intends is irrelevant. The ruling matter is the victim's reasonable belief that the offensive conduct is severe and pervasive enough to create a hostile environment.

Recently, within the hostile or offensive working environment area, a new subtype of liability known as "third-party harassment" has arisen. Here the harasser is an outside party, such as a vendor, supplier, customer or any other person who routinely interacts with a company's employees. Because construction businesses routinely deal with a variety of such third parties, accusations of this form of harassment are becoming particularly prevalent in your industry.

The courts have ruled that if an outsider uses sexually explicit physical or verbal behavior that would constitute a hostile environment if he or she were a co-worker, the employer must intervene to stop it.

In other words, you're fully responsible for your business's work environment. So if you or a supervisor becomes reasonably aware of a third party's inappropriate behavior, and you do nothing to stop it, you could become legally liable for that harassment.

How liability is determined. The U.S. Supreme Court has ruled that the two primary harassment types - quid pro quo and hostile work environment - aren't the only factors determining liability. The law still requires proof that severe and pervasive conduct exists. And even if proof exists, employers aren't always liable in hostile work environment cases.

On the other hand, the court has ruled that an employer can be liable for a supervisor's or employee's bad behavior if the victim can show that he or she suffered from "tangible employment action" because of the accused's actions. Examples of tangible employment action include:

• Termination or demotion
  
• Pay decreases
  
• Withheld raises or promotions
  
• Significant changes to or elimination of benefits
  
• Reassignment of the employee's responsibilities to ones significantly different from previous duties

If no tangible employment action was taken, but conduct still defined as sexual harassment occurred, you must be able to prove that: 1) You exercised reasonable care to prevent and promptly correct any sexually harassing behavior, and 2) The employee "unreasonably failed to take advantage of any preventive or corrective opportunities provided by the employer or to otherwise avoid harm."

If you can't prove both of these two elements, a court will hold you liable.

What you should do. To ensure you're exercising reasonable care, the Supreme Court and other legal bodies recommend you immediately:

• Create or review and revise your sexual harassment policy, making sure you've distributed it to employees
  
• Require each employee to sign an acceptance form, acknowledging that he or she received the policy and understands its contents, and
  
• Provide mandatory sexual harassment prevention training for every level of worker and for new hires
  You also need to develop reporting procedures so employees can report and register complaints. These procedures should ensure confidentiality as well as an alternate measure, outside the normal channels, to report harassment by supervisors. Immediately and seriously investigate each complaint. If you discover harassment has occurred, act quickly to resolve the situation.

Editor's Note: Randy J. Bonnecaze is a Certified Public Accountant (CPA) with Hannis T. Bourgeois LLP, Baton Rouge.