A perusal of recent headlines shows that companies will place their heads firmly in the sand to keep harassers on the payroll if the company is focused on short term profits.
Despite potential ruinous risk to reputation, costly turnover, lost work time and higher health care costs (among other things) the fact of the matter is that many employers tolerate sexual harassment when the harasser is valuable to the organization. In some ways, the on-going wave of public sexual harassment incidents is similar to the problem with unsafe cars manufactured in the United States in the 1960s. It was cheaper for car makers to settle lawsuits out of court than to manufacturer safer cars.
In February, 21st Century Fox renewed Bill O’Reilly’s contract knowing that he was in the process of settling a sexual harassment complaint by a news analyst, who eventually received a $32 million settlement. O’Reilly, then the most-watched figure on cable TV, had earlier settled several other sexual harassment claims out of court.
Producer Harvey Weinstein had several Oscars to his credit but he was a notorious bully for years, not to mention sexual predator (or worse). He also was known to engage in physical violence at the office on occasion.
TMZ says Weinstein’s 2015 employment contract states that if the Weinstein Company had to pay settlements for his sexual or other misconduct, he must reimburse the company and pay an escalating set of fines: $1 million for the fourth and any subsequent instance.
Congress must insure employers that ignore evidence of sexual harassment face consequences that make it more expensive for them to do nothing than to act.
The complacency of Fox and the Weinstein Company demonstrates how little employers today fear the American legal system, which they count on to work on their benefit. Typically, employers retain human resource officers and legal staff who are trained to protect the company from sexual harassment complaints. Courts permit employers to make the legal process as long and difficult as possible for the victims, who often have few resources because they were driven out of their jobs by the employer and the harasser.
A recent development has made it even easier for employers. When the EEOC finds there is reasonable cause to believe the employer is guilty of sexual harassment, it offers a free and confidential mediation program whereby the employer can settle the matter – usually for peanuts – without even having to go to court. And it’s all secret!
Both Fox and The Weinstein Company knew or should have known of their employee’s abusive behavior but apparently they concluded the benefit of retaining the abuser outweighed the cost of paying the occasional out-of-court settlement. What is needed is serious consequence for employers who ignore evidence of sexual harassment. And by that I mean serious. A company that is making a profit of X billion should be ordered by a court to pay a percentage of its profit in damages. In that way, society will insure that employers take sexual harassment seriously.