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Failure to Investigate Leads to $95 Million Sexual Harassment Verdict

Recently, an Illinois jury gave employers a not so subtle reminder that every claim of workplace harassment should be investigated properly.  The jury awarded a former employee $95 million in compensation for the extreme harassment she endured from a manager at work despite her complaints to the Company hotline.

The plaintiff Ashley Alford, an employee at a large rent-to-own furniture chain, claimed she was constantly harassed by her manager Richard Moore.  The harassment began with pinching, lewd comments and unwanted gifts.  On one occasion, Moore hit Alford’s head with his genitals.  The harassment culminated with the manager trapping plaintiff in a storeroom, holding her down and masturbating over her. 

Plaintiff claims she called the Company hotline to report the harassment but she was never contacted by an investigator.  However, she says shortly after this, Moore’s supervisor confronted her in front of Moore, and told Moore to “watch his back.”  The Company never took any disciplinary action against Moore.  The Company however claims her complaint to the hotline was vague and it never received any other complaints from plaintiff. 

The jury awarded plaintiff $15 million in compensatory damages and $80 million in punitive damages.  This judgment represents about 80% of the Company’s 2010 profits.  It is very likely this will be reduced, as there are caps on the amounts of damages which can be awarded under certain statutes.  In fact, about half of the award has already been reduced.  A judge reduced the $4 million awarded under Title VII to $300,000 and the $50 million in punitive damages under Title VII to zero. 

While the damage reductions are a relief to employers, the Company’s argument is a lesson to all employers.  Even if a complaint is vague, Management must take steps to investigate.  If the Company had gone to the plaintiff and asked for further details, it could have performed an investigation and disciplined Moore before things got out of hand.  It is important to note that this case went beyond the usual employment sexual harassment case.  This case involved instances of sexual assault and battery.  Nevertheless, no employer wants their company name splattered across the headlines.  This is a vivid reminder that investigating each and every claim of harassment and discrimination is vitally important to maintaining a positive environment for all employees and avoiding litigation. 

Brody and Associates regularly provides training and counseling on maintaining a harassment free environment and on employment law issues in general. If we can be of assistance in this area, please contact us at info@brodyandassociates.com or 203.965.0560.