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Beyond the Usual Suspects

By Melanie L. Herman

Risk managers and senior professionals who bear responsibility for risk management or human resources often protest that keeping abreast of changing laws and regulations is a difficult, if not impossible task. The employment field presents many challenges, as changes in state and federal laws must be considered along with judicial decisions that may defy long-standing practice. A new ruling provides a terrific example of the need to “stay tuned” when it comes to managing employment risk.

In Miller v. Dept. of Corrections (05 C.D.O.S. 6268. July 18, 2005), the Supreme Court of California held that an employee may establish an actionable claim of sexual harassment under California’s FEHA (Fair Employment and Housing Act) by demonstrating that widespread sexual favoritism was severe or pervasive enough to alter working conditions and create a hostile work environment. In this case, whose facts provide compelling evidence that “truth is stranger than fiction,” two female correctional system employees alleged that a hostile work environment was created by the warden’s concurrent sexual relationships with two deputy wardens and his secretary.

What makes this case unique and instructional? The plaintiffs in the case did not complain that they were subject to unwanted sexual advances by the warden. Instead, their allegations detail a long history of favoritism towards his sexual partners that put the plaintiffs at a decided disadvantage (e.g., loss of work responsibility and entitlement to benefits) in some cases and in danger in others (e.g., abusive conduct by one of the warden’s sexual partners was ignored).

Writing on behalf of a unanimous court, Chief Justice Ronald George noted, “Even widespread favoritism based upon consensual affairs may imbue the workplace with an atmosphere that is demeaning to women because a message is conveyed that managers view women as ‘sexual playthings’ or that the way required to secure advancement is to engage in sexual conduct with managers… Such a hostile environment may be created even if the plaintiff never is subjected to sexual advances.”

Next steps: The Court has remanded the case to the appellate court for further proceedings.

Risk Management Reminders:

• Remember that your organization has an obligation to act upon any complaint alleging harassment. The Miller case clarifies that the obligation to investigate includes complaints by Party A about relations between Parties B and C. Many employers have embraced the duty to investigate even without recognizing that Party A may be a future plaintiff in a sexual harassment suit.
  
  
• Revisit your policy on fraternization. While research on relationships suggests that the workplace is a common initial meeting place for adult relationships, employers cannot ignore the risks that accompany dating in the workplace. The California case reminds us that workplace relationships can lead to claims by persons involved in a relationship as well as those who aren’t directly involved but allege that the relationship of others nonetheless affected the terms and conditions of employment.
  
  
• When developing or re-tooling your policy on fraternization, remember to place the emphasis on prohibiting activities that are potentially damaging to your organization. An appropriate policy makes clear that the organization does not seek to prohibit legal conduct carried on outside the workplace or intervene in the personal lives of employees. The policy may continue by providing examples of situations where fraternization is prohibited due to its potential damaging effect on the workplace. For example: where the individuals involved have a manager/supervisee relationship, where one of the individuals involved works in the HR department, or where due to a natural line of progression one person in the relationship might become the supervisor of the other.
  
  
• Remember your “Ps” and “Rs.” Pay special attention to Privacy when you are drafting or updating your policy on fraternization. Also consider your exposure to Retaliation claims. Remember that a retaliation clam may succeed even when the underlying complaint fails (e.g., in this case an allegation of sexual harassment resulting from a hostile work environment).

ABOUT THE AUTHOR

Melanie Herman is executive director of the Nonprofit Risk Management Center (www.nonprofitrisk.org). She can be reached at Melanie@nonprofitrisk.org.

riskVue | The webzine for risk management professionals
August 2005