Publications
Second: It’s Time to Review Your Employee Complaint and Exit Interview Procedures,
and to Train Your Managers on Their Proper Use
The recent Supreme Court case of Pennsylvania State Police v. Suders has justifiably received a great deal of attention, especially among HR professionals. It is relatively easy to explain what the case says, but what does it really mean in terms of instructing businesses on the art of avoiding employment lawsuits?
Suders involved a “constructive discharge” situation – that is, the plaintiff claimed that she had been sexually harassed to the point where her work life had been made so intolerable as to leave her with no choice but to quit. She sued for sexual harassment, and the issue the Supreme Court had to resolve was one of monumental, practical importance: what defenses can an employer assert to constructive discharge claim?
Background… In 1998, the Supreme Court decided two cases – often referred to together as Ellerth/Faragher -- that drastically changed employment law. In Ellerth/Faragher, the Court provided some bad news, and some not-as-bad news for employers.
First, the Court ruled that in proven harassment situations involving a “tangible employment action” – that is, harassment which results in termination, demotion, discipline and so on – there is no defense, and the employer will be held liable, period. Obviously, those cases heightened the need for preventive measures (and, in effect, gave birth to CCG).
Second, the Supreme Court ruled that in proven hostile work environment situations (as opposed to a tangible employment action targeted directly at an employee), an employer would be permitted to raise a defense: the employer can avoid liability if 1) it can prove that it exercised reasonable care to prevent and promptly correct any harassing behavior of which it was made aware, and 2) if it can prove that the plaintiff unreasonably failed to use the preventive or corrective policies and procedures provided by the employer.
Focus on the second component of this defense for now. It boils down to this: if the employer has a viable complaint and investigation procedure in effect, and an employee who is victimized by a hostile work environment fails to use that procedure without good reason, the employee could easily lose his or her harassment lawsuit – basically, the Supreme Court ruled that in cases which do not involve a tangible employment action, an employee has to give an employer a chance to resolve the situation so long as the employer has established a reasonable procedure for the employee to do so.
Enter the Suders case. The question in Suders was whether a constructive discharge situation would be treated as a tangible employment action (i.e., the employer loses, no defenses allowed), or whether it would be treated as a hostile work environment case (i.e., the employer could defend by showing that the complaining employee did not take advantage of the reasonable policies and procedures the employer had implemented to redress work place harassment).
The Supreme Court ruled that the constructive discharge in Suders was not to be treated as a tangible employment action, and that the employer could offer the same defenses as are available in a hostile work environment case – good news for employers. So, while the existence of viable complaint and investigation procedures is no guaranty of victory, employers who have implemented such procedures will, in similar situations, be given the opportunity to present a defense… a great alternative to the “you’re liable, no matter what” result that abides in tangible employment action cases.
It is important to note, however, that the magic only works if you do it right. This is not a simple process. The EEOC and the courts have provided lengthy guidance on what kinds of complaint and investigation procedures will pass muster, and companies are well advised to seek professional guidance in this area. For instance, see the March 2002 and June 2002 issues of Avoiding Lawsuits. It is also of great importance to establish a compliant documentation procedure that allows you to prove you did the right thing, and an exit interview procedure can also be extremely helpful.
Finally, it cannot be stressed enough that merely enacting the policies – even the right policies -- without also training the people responsible for administering the policies, is exceptionally dangerous. Consider a 2004 Circuit Court case, MacGregor v. Mallinckrodt. An employee complained of discrimination, and utilized the company’s complaint procedure. The Court found, however, that after the complaint was made, only minimal investigations were conducted, and no effective action was taken to remedy the situation – all contrary to the company’s enacted procedures. The result: an award of $1 million in punitive damages (subsequently reduced to $300,000 by statute). Ignoring your own procedures, said the Court, is tantamount to not bothering to enact them in the first place.
In effect, in Suders, the Supreme Court has handed employers a life preserver in the increasingly-common constructive discharge cases that many employers face. You can grab onto the life preserver by properly enacting and implementing the right kinds of procedures. Or you can choose to drown.
Counsel Consulting Group LLC helps companies throughout the United States avoid employment and HR-related claims and liabilities. CCG assesses existing policies, procedures and problem areas; it provides customized liability-avoidance training to managers and executives; and it designs and implements business techniques that reduce employment liability risks on a long term basis. CCG also offers specialized workshops for managers and HR executives, customized consulting in focused employment-related areas, and CD-ROM and web-based training alternatives. For more information, contact us at info@powelltrachtman.com and visit our website at www.counselconsulting.com.
Powell Trachtman Logan Carrle & Lombardo PC. is a full service law firm with offices in suburban Philadelphia, PA, Harrisburg, PA and Cherry Hill, NJ. Powell Trachtman represents a variety of commercial enterprises, entrepreneurs and business executives in respect to their litigation, litigation avoidance planning, business formation, business transactions, estate and tax planning, and other needs. We are also approved defense counsel for numerous insurance carriers in matters pertaining to professional malpractice, products liability, employment practices, directors and officers liability, and many other fields. For more information, contact us at info@powelltrachtman.com and visit our website at www.powelltrachtman.com.
Various insurance carriers have approved Powell Trachtman as counsel for the defense of employment practices claims, directors and officers liability claims, and other claims litigated in Pennsylvania and New Jersey. If a claim is brought against you, please feel free to contact us for further information.
