Friday, May 16, 2008

In responding to harassment complaint, prompt means prompt

In Bailey v. USF Holland, the 6th Circuit had occasion to examine whether the employer's response to two African-American employees' claims of racial harassment was sufficiently prompt to defeat liability. This case provides a good case study from which companies can learn how, and how not, to respond to an employee's internal complaint.

Bailey and Smith, both African-American, were dock workers for USF Holland. Throughout their employment, their white coworkers constantly subjected them to the word "boy." When they would complain to their coworkers that the word "boy" is offensive when directed at a black man, they would sarcastically respond, "damn it boy." The more they complained, the more serious the harassment would become. It moved from words to vandalism, including "boy" spray painted on equipment, etched into walls, used to depict black men in cartoon drawings, and even written on a calendar on MLK Day. The harassment was not limited to the use of the word "boy." Bailey discovered a noose hanging in the dock area, and Smith overheard one white coworker telling another that he liked Smith because he could call him "a low-down dirty nigger" and Smith would not do anything about it.

Two years after Bailey and Smith started complaining to management about the offensive use of the word "boy," a new terminal manager and the VP of HR decided to conduct "sensitivity training" at the terminal. During that training it was explained that "boy" was offensive to African-Americans because it was used as a racial epithet during slavery. During the training, "several white employees voiced resistance to the idea that it was wrong to refer to African-American men as 'hey boy' or 'damn it boy.'" One white employee, Fred Connor, even told the terminal manager that "boy" was a "southern thing" and he would continue to use it regardless of company policy.

Not surprisingly, the behavior continued for several months after the training, as did Bailey's and Smith's complaints to management. At that time, USF brought in an outside lawyer who conducted a three-day investigation. He concluded that "while the environment likely is not racially hostile [huh?], it is certainly one in which more sensitive employees can feel uncomfortable." As a result, the VP of HR wrote to Bailey and Smith, telling them that the company could not discipline any employees because the use of "boy" was not racially motivated and that everyone had denied the other alleged conduct.

As the graffiti and harassment continued, USF hired a handwriting expert and terminated the offending employee, Fred Connor. He filed a union grievance and was reinstated. After his reinstatement, Connor reiterated to the terminal manager that "he would not adhere to the policy and would continue to use the word 'boy' as he saw fit."

Finally, in 2006, 4 years after Bailey's and Smith's first complaint and a year after they filed their lawsuit, USF installed 25 security cameras, which finally ended the graffiti.

At a bench trial, the district court judge awarded Bailey and Smith each $350,000 in compensatory damages.

On appeal, USF argued that it could not be liable for the harassment because it took "reasonable, prompt, and appropriate corrective action." The 6th Circuit disagreed:

Defendant cites examples of its corrective action, noting for example that it "consistently had a reasonable harassment policy," conducted employee meetings to respond to plaintiffs' complaints, and disciplined the employee responsible for the graffiti. The district court correctly rejected these actions as insufficient. A harassment policy itself means nothing without enforcement, and the persistent harassment plaintiffs received over an extended period of time caused the district court to conclude that the policy was not consistently enforced. Defendant conducted employee meetings, but plaintiffs' coworkers stated that they did not consider their use of "boy" to be offensive and insisted that they would continue to use it. Defendant discharged Connor once it discovered that he created the graffiti, but he was reinstated soon thereafter. USF Holland was unable to stop the graffiti until it installed security cameras – an act it did not take until after plaintiffs initiated this lawsuit.

Termination of the alleged harasser is not the be all and end all of corrective action. Usually courts do not second guess an employer's course of remedial action. Indeed, had the sensitivity training succeeded in ending the harassment, I doubt that Bailey and Smith would have prevailed. When, however, the offending employee tells the VP of HR during sensitive training that he will continue calling black employees "boy," and others offer similar resistance, a company cannot turn a blind eye and hope that everything will work out. By the time employees started being disciplined and security cameras were involved, it was "too little, too late."

The timeline in this case spanned nearly 4 years from the first complaint to the installation of the cameras. In a case such as this, 4 weeks might not even be quick enough of a response. The severity of the response (i.e., counseling, discipline, termination) can vary depending on the severity of the harassment, but the quickness of the response cannot. Companies that allow problems such as these to fester and continue by dragging their feet in investigating and remedying them do so at their own peril, as the $700,000 verdict in this case illustrates.

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