2018 Winter ERP Report - Special Edition

report

Employment Law Updates and Employee Relations Answers for Franchised New Car Dealers / Winter 2018

SPECIAL EDITION: Sexual Harassment Issue

Hostile work environment sexual harassment is more subtle and more common. This category refers to instances in which an employer engages in, encourages, or allows behavior that creates a workplace environment that a reasonable person would consider intimidating, hostile, or offensive or that unreasonably interferes with an employee’s ability to perform their job. Examples include: • Sexually offensive remarks, jokes, or gestures

Harvey Weinstein, Al Franken, Kevin Spacey, Matt Lauer, Roy Moore — the list goes on and on! It seems that every day there are new stories, across almost all industries, about workplace sexual misconduct. In light of the current conversation about appropriate workplace behavior, ERP has produced this special “Sexual Harassment Issue”. This edition offers dealers an understanding of what sexual harassment is, how to investigate reports of it, components of an anti-sexual harassment policy, how to discipline sexual harassers, and steps to ensure your dealership discourages all forms of harassment.

• Unwelcome sexual advances • Unwelcome physical contact • Coerced sex acts • Physical intimidation • Displaying pornographic material • Comments about someone’s gender or sexual preferences

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$10 Mil Settlement in OEM Harassment Case

The Equal Employment Opportunity Commission (EEOC) recently reached a $10 million settlement with Ford for sexual and racial harassment claims at two Chicago plants. A lawsuit related to these claims is still making its way through the courts, which means Ford will pay much more than $10 million before the matter is resolved. While rarely discussed, employee turnover and reduced productivity are a real cost, in addition to the monetary expense of settlements, legal fees, and court-ordered fines. Cases like this are stark reminders of how much a business risks by failing to prevent workplace sexual harassment. What is sexual harassment? There are two broad categories of sexual harassment — quid pro quo and hostile work environment. Quid pro quo sexual harassment occurs when an employer, manager, or supervisor offers favorable treatment to an employee in exchange for sexual or romantic attention, or threatens negative treatment for refusing. For example, if an employee refuses to go on a date with a supervisor and the supervisor then threatens to demote them or schedules them for inconvenient shifts. Naturally, following through on these threats also qualifies as quid pro quo sexual harassment.

Who can commit sexual harassment? • People of any gender can commit sexual harassment. The victim doesn’t need to be of a specific gender in order for their behavior to qualify as sexual harassment. • The sexual harasser can be the victim’s supervisor/manager, an agent of the employer (i.e., a contracted construction worker), a coworker, or even a nonemployee (i.e., a customer).

2 When must a victim report sexual harassment in order for the harasser to be punished? Although headlines report victims coming forward after a decade or more, federal, state, and local laws all limit the time to take legal action against a harasser. New York State and New York City each allow three years from the date of harassment while agencies like the EEOC have shorter time periods.

Prevent Sexual Harassment

GNYADA Employee Relations Plan Newsletter / www.gnyada.com / Winter 2018 report 3

Dealers should focus on the overall dealership culture rather than just what is legally considered sexual harassment when working to prevent workplace sexual harassment. Employees may find a workplace culture toxic long before it reaches the legal threshold of sexual harassment. Studies show that creating a culture that discourages sexual harassment may lead to higher employee retention. Steps to Create a Culture of Respect • Respect starts at the top! Management should be modeling appropriate language, actions, and behavior, including not joking about being“politically correct”or staying out of trouble with HR. • Make sure employees are able to report behavior that may not be legal harassment but that makes them uncomfortable at work, whether the behavior is directed at them or a coworker. • Don’t allow supervisors or managers to “bully”their subordinates as this behavior can easily lead to sexual harassment. Even if your dealership has taken steps – having clear policies, providing effective training, and creating a culture of respect – to prevent sexual harassment, it may occur anyway. If sexual harassment does occur, the first step is investigating the claim to determine the appropriate response. INVESTIGATIONS SHOULD COVER THE F OLLOWING STEPS:

What if a dealer learns about sexual harassment that took place several years ago? If an individual incident took place so long ago that legal action cannot be taken against the alleged sexual harasser, dealers are still advised to investigate, as detailed on page 3. This will ensure that the sexual harassment has not been ongoing and that your dealership does everything possible to discourage other potential sexual harassment. A dealer’s first step should be to contact ERP or your dealership’s employment counsel whenever an employee complains about sexual harassment.

8 Steps to Investigate Claims of Sexual Harassment

1. Meet with the complaining employee to conduct an in-person interview and obtain a written report about the details of the alleged incident(s). 2. Meet with the alleged offender to conduct an interview and obtain a written report of their version of events. 3. Interview witnesses who can either confirm or contradict each party’s account. 4. Review each party’s personnel file to get further information about their relationship and whether there have been prior complaints about or made by either party. 5. Conduct any necessary follow-up interviews and review all information to determine if the alleged incident(s) in fact occurred.

6. If the incident(s) did not occur and the allegation was made in bad faith, consult with ERP or your lawyer to determine what disciplinary action may be taken against the complaining employee . 7. If the incident(s) did occur, determine the proper response, whether it is ensuring the two parties no longer work in the same department or on the same shift, retraining the offender, issuing a verbal or written warning, suspension, or termination. 8. Have a wrap-up meeting with the complaining employee to tell them about the investigation’s outcome. If the alleged offender remains on staff, advise the complaining employee to immediately report any further actions or retaliation against them.

report GNYADA Employee Relations Plan Newsletter / www.gnyada.com / Winter 2018

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An Employee Is Sexually Harassed but Doesn’t Want it Reported—NowWhat?

This scenario may be familiar: A staff member witnesses an employee being sexually harassed and reports it to management, or perhaps a manager witnesses the sexual harassment. When the witness tells the employee they are going to report the incident, the employee says they would prefer it not be reported. Whatever the employee’s reason, the employer faces a dilemma. Employers are legally required to provide their employees with safe work environments that are free of sexual harassment and are obligated to discipline any violators of the company’s anti-sexual harassment policy. In most cases, employers will conduct some form of an investigation into any allegations to determine whether further action is required. Obligation to Investigate Lack of cooperation or input from the allegedly sexually harassed individual may make it difficult to build evidence or to determine whether the conduct constitutes sexual harassment. Employers’ decisions to act in these circumstances should be based on the nature of the alleged conduct. There is no official boundary for egregious sexual harassment that must be investigated even if the alleged victim doesn’t wish to make an “official” complaint. Employers may differentiate based upon the severity of the allegations:

• If an employee allegedly gropes, makes an unwanted advance, exposes themselves, or commits quid pro quo harassment, the employer must investigate the incident regardless of whether the victim wants them to. Simply put, there is no “gray area”here. This type of conduct is too flagrant to ignore and can be a danger to other employees if permitted to continue. • On the other hand, if one employee says that a coworker made a sexual joke or crude hand gesture but doesn’t want to make a complaint on their own behalf, the employer may choose not to investigate. In instances where employers choose to pursue disciplinary action without cooperation from the allegedly sexually harassed individual, they may use the accounts of eyewitnesses, themselves included, during their investigations. Additionally, the harshness of the discipline (e.g., termination vs. suspension) is determined by the employer, not someone reporting sexual harassment. Important reminder: It is the employer’s obligation to determine whether an investigation is warranted. Those who make complaints or provide information should be assured that the employer will not tolerate any form of retaliation against them for participating in an investigation.

Legal information is not the same as legal advice. This content is offered for general informational and educational purposes only; it does not constitute legal advice or opinions. Moreover, the transmission or receipt of this information is not intended to create an attorney-client relationship between sender and receiver. If you want professional assurance that this information, and your interpretation of it, is appropriate to your particular situation, consult an attorney. ERP thanks James E. McGrath III, Esq. and Robert M.Tucker, Esq. from Putney,Twombly, Hall & Hirson LLP for contributing to this newsletter.

18-10Whitestone Expressway, Whitestone, NY 11357 718.746.5900 / www.gnyada.com GNYADA Employee Relations Plan Newsletter

Winter 2018

5 How to discipline an employee who has committed sexual harassment

Many factors must be taken into account when considering how to resolve an occurrence of sexual harassment. Considerations such as the specific nature of the offense, the relationship between the parties, and what outcome the complaining employee would be comfortable with make it ill-advised to have a“one-size-fits-all”discipline policy. While automatically terminating the offender may seem like the most straightforward approach, a one-strike rule may backfire. A strict policy could actually make some employees reluctant to report bad behavior. For example, if an employee just wants a colleague’s behavior to stop, they may not report it, knowing it may lead to termination. This could allow objectionable behavior to continue. In first-offense situations in which the infraction was not severe (i.e., an off-color joke or comment), dealers may consider resolving the issue by: • Ensuring that the employees do not interact with one another. However, use caution if moving the complaining employee to a new department or shift, as this can be perceived as retaliation.* • Having the offender complete training to ensure that their one- time violation stays that way.

If the offense was more serious, but not severe enough to warrant termination, suspension may be appropriate. Dealers who are considering suspending an employee should contact ERP to ensure that suspension does not violate wage and hour laws. For severe occurrences, dealers should consider terminating the offender, as allowing the individual to remain on staff may create an unsafe/hostile work environment.* Note: Carefully document the investigation and justify any disciplinary decision in order to protect the dealership against a potential claim of wrongful discharge.

You Terminate

Think and Wait before

An automobile dealership agreed to pay $2 million to settle a lawsuit in which a lot manager was alleged to have sexually harassed dozens of employees. The manager’s behavior allegedly included flagrant sexual comments, requests for oral sex, and regularly touching, grabbing, and biting employees’ buttocks and genitals. The suit also alleged that the dealership retaliated against employees who objected to the sexually hostile work environment. More than 50 employees received relief through the settlement, which also required the dealership to: - Implement policies and practices to ensure a work environment free of sexual harassment; - Evaluate its managers’compliance with anti-discrimination laws; - Hire a monitor to oversee the dealership’s efforts to provide a sexual harassment-free workplace; 6 *If an employee belongs to a union, check with counsel before taking any disciplinary action to ensure you are not violating the Collective Bargaining Agreement.

Dealership Pays $2 million to Settle Sexual Harassment Suit

- Provide regular anti-discrimination training to its employees and managers; and - Report other discrimination complaints to the EEOC for the duration of the decree.