Are Sexual Harassment Rules Too PC for Small Businesses?

By Kitty French, Manta Content Editor - August 8, 2016

Are Sexual Harassment Rules Too PC for Small Businesses?

Sexual harassment policies are a necessary human resources aspect of small business management. Why are so many owners reluctant to institute rules?

Sexual Harassment Tipsheet

Sexual harassment: Unwelcome advances, requests for sexual favors, verbal or physical harassment of a sexual nature, or offensive remarks about a person’s sex that create a hostile work environment.

  • Both men and women can be victims or perpetrators of sexual harassment.
  • Harassers can be the victim’s supervisor, coworker or customer.
  • Sexual harassment violations are enforced by the federal Equal Employment Opportunity Commission (EEOC) and/or state and local Fair Employment Practices Agencies (FEPA).
  • Federal sexual harassment laws cover all private and public employers with 15 or more employees.
  • Some states and local governments have extended these laws to very small companies with fewer than 15 employees.

A sexual harassment lawsuit filed by former Fox News host Gretchen Carlson led Fox News founder and CEO and former chairman Roger Ailes to resign this summer. Other network executives were also fired over the allegations. Carlson’s suit, bolstered by harassment complaints levied by a number of Fox News staffers, captured attention this election season and even generated a response from GOP nominee Donald Trump.

Sexual harassment isn’t just a problem in show business or big business, however. Employers—including small business owners—are responsible for protecting their employees and their organizations from harassment and its legal ramifications. The consequences can be disastrous for those who don’t.

Take the Dunkin’ Donuts franchise owner in New York who agreed in August to pay $150,000 to settle a federal Equal Employment Opportunity Commission (EEOC) lawsuit after his manager repeatedly harassed young female employees.

Or McWhite’s Funeral Home in Fort Lauderdale which, according to its website, has fewer than 10 employees. Its owner agreed in May to pay $85,000 to settle harassment charges filed against him by employees.

Or take Achiote Restaurant in San Ysidro, California, which in April agreed to pay $27,500 to settle a harassment and retaliation suit. The EEOC found that owners failed to properly respond when a male manager was caught videotaping male employees in the restroom. That settlement required the restaurant’s owners to develop harassment policies and provide training to employees and managers.

A total of 11,364 sexual harassment charges were handled by the EEOC and state agencies in 2011 (the most recent combined reporting data). Of those cases, 26% were decided in favor of complainants, with employers of all sizes paying out $52.3 million in victim settlements in one year alone.

“Small employers would be well advised to adopt an adequate anti-harassment policy, provide training to their employees, and follow the policy if an employee makes a complaint,” said Michael Semanie, an employment lawyer and partner at Killgore Pearlman in Orlando. Such a policy, he said, “shows employees that the employer cares about their wellbeing, while also providing a legal defense in the event of a sexual harassment claim.

Yet 67% of small employers have no anti-harassment rules or training in place, according to a new Manta poll on small business sexual harassment protocols.

Forty-one percent said sexual harassment policies were “unnecessary given my small number of employees.” Eleven percent said such rules were “too PC for my company’s culture.”

“I’ve had clients complain that the work environment is casual or not very regimented, so implementing training and written policies results in pushback from employees who aren’t used to such rules,” said Gordon Berger, a labor and employment attorney at Ford Harrison in Atlanta.

But clear rules and training are “simply good business,” said Berger. “Without anything in writing and without training, an employer risks that an employee interprets the policies differently, claims there was no policy or says that he/she was unaware.”

That puts you, the business owner, without much defense should your employees or managers harass someone or fail to address a complaint.

“Small and informal companies may feel that this kind of training spoils the fun. They don’t want to introduce what they see as bureaucracy and too many corporate policies,” said Mikaela Kiner, founder of uniquelyHR, a human resources consulting firm in Seattle. “But nothing spoils fun like having employees treating each other disrespectfully.”

No matter how small your staff, it’s never too early to train employees on your standards of conduct around sexual harassment, said Kiner. “Small teams often have a feeling of friendship and camaraderie, and it’s easy to forget that there are boundaries at work.”

Poll methodology: Between 7/27 – 8/1 2016, Manta surveyed 594 small business owners via on-site poll. The margin of error is +/- 4.02 percentage points with a 95% confidence.