#MeToo Era Settlements…$3.5 Million at a Time

by Benjamin A. Nucci and Audrey E. Chastain 

Recently, a California company settled a U.S. Equal Employment Opportunity Commission (“EEOC”) sexual harassment lawsuit by consent decree for $3.5 million. Additionally, and as part of the settlement, the company will hire a third-party monitor, create an internal equal employment opportunity consultant position and an internal compliance officer position, institute sexual harassment training (including civility and bystander intervention training) for its employees, revise its anti-discrimination and anti-retaliation policies, and maintain records of any sexual harassment and retaliation complaints, audits, and reporting. 

What happened? According to the EEOC’s complaint, both male and female employees were subjected to sexual harassment and retaliation in violation of Title VII of the Civil Rights Act of 1964. This included unwelcome comments of a sexual nature, employees exposing themselves, and employees being subject to unwanted physical touching of a sexual nature. The complaint alleged that when the harassed employees complained to their supervisors and human resources, the company failed to take the complaints seriously or engage in any remedial measures. The EEOC claimed that some of the employees left their jobs because of the anxiety, depression, and stress created. The company disputed all allegations in the complaint. 

Although no answer was filed by the company, the “equal opportunity” defense might have been raised. Title VII provides that it is an unlawful employment practice to discriminate “because of” an individual’s sex. See 42 U.S.C. § 2000e-2(a)(1). Courts have historically viewed sexual harassment as a form of sexual discrimination. See Meritor Sav. Bank, FSB v. Vinson, 477 U.S. 57, 64, (1986). Focusing on the “because of” requirement under Title VII, the “equal opportunity” defense posits that a perpetrator harassing both men and women escapes liability because the victim of the harasser cannot prove that the perpetrator discriminated because of that individual’s sex. The theory being that “[w]hen the conduct is equally harsh towards men and women, there is no hostile work environment based on sex.” Reine v. Honeywell Int'l Inc., 362 F. App'x 395, 397 (5th Cir. 2010) (emphasis added).

The settlement therefore avoided consideration of the “equal opportunity” defense. Nonetheless, the case is a reminder of the importance of having effective employee training, complaint procedures, and behavioral policies in place to streamline operations and ensure a harassment-free workplace. That way, employers can find ways to avoid claims that cost $3.5 million.