He's Just Not That Into You

A New Twist On Workplace Romance After Thompson v. North American Stainless

Workplace romances have always been a breeding ground for employment lawsuits. Claims of sexual harassment, discrimination, favoritism and retaliation erupt from the aftermath of two “romantic souls” finding each other (and often losing each other) at work.

The recent United States Supreme Court ruling in Thompson v. North American Stainless, LP, (Jan. 24, 2011) added a new twist to the “workplace romance-begets-litigation” scenario. In Thompson, Eric Thompson and his fiancé, Miriam Regaldo, both worked for North American Stainless (NAS). In 2002, Regaldo filed a charge with the Equal Employment Opportunity Commission (EEOC) alleging that her supervisors discriminated against her based on her gender. On February 13, 2003, the EEOC notified NAS of Regaldo's charge. Approximately three weeks later, NAS terminated her fiancé, Thompson. In his lawsuit, Thompson alleged that he was terminated in retaliation for his fiancé's EEOC charge, while NAS contended that performance-based reasons supported Thompson's termination.

The US Supreme Court ruled that NAS’s firing of Regaldo’s fiancé was a retaliatory act designed to punish her for filing the EEOC complaint and that Thompson – the fiancé who did not engage in any protected activity such as make the complaint or act as a witness in the investigation did have standing to sue for retaliation as a person in Regaldo’s “zone of interest.”

Refusing to define which third party relationships are defined as within the “zone of interest,” the Court referred back to an earlier decision it made in a retaliation case, Burlington N.S.F. R. Co. v. White and stated, “We expect that firing a close family member will almost always meet the Burlington standard, and inflicting a milder reprisal on a mere acquaintance will almost never do so, but beyond that we are reluctant to generalize."

In leaving the door open as to which relationships are within an employee’s “zone of interest” the Court expanded the number of people with standing to sue for retaliation. Not only will this contribute to “retaliation cases” being the number one claim filed with the EEOC, as it was last year, but it has added new “language” to the workplace romance scenario. Now, if a person wants to know if their relationship is heading towards the altar, they can inquire whether their beloved considers him or herself within their “zone of interest.” If the answer is “No,” that’s a definite sign that he or she’s just “not that into you.”

Some Proactive Lawsuit Prevention Strategies that employers can implement to Prevent Retaliation Lawsuits are:

1) Draft and implement a No Retaliation Policy that is separate and apart from your harassment prevention policy. Most employers have a one or two sentence prohibition against retaliation in their other policies. This is no longer enough in light of the prevalence of retaliation claims.
2) Train your employees and managers on retaliation (again, not just an add on topic to their sexual harassment prevention training). Spend time explaining to them what types of behavior constitute potential retaliation, (including conduct that doesn’t detrimentally affect pay) and to be aware that third parties who have close relationships with a complainant and witnesses are now within the “zone of interest” for retaliation.
3) Review Anti-Fraternization Policies, if the company has them, to ensure that they are consistently enforced, but watch out for selective enforcement right after a complaint is filed.
4) Involve HR when disciplining complainants, witnesses and people within their zone of interest, especially when doing so right after the complaint is filed, or an investigation takes place.
5) During an investigation into the underlying claim, remind employees to come to HR if they feel that they are experiencing retaliation so that the company can investigate the retaliation claim and help protect the parties and witnesses in an investigation, as well as those individuals within their zone of interest.

Lawsuit Proof Investigations

One of the best Lawsuit Prevention Strategies that I advocate to my clients is how to anticipate the myriad of ways a plaintiff’s lawyer will undermine the investigation that you, the employer (or in many cases the human resource investigator or in-house counsel), conducted. Why does this prevent lawsuits? Because (1) a Lawsuit Proof Investigation may deter a plaintiff’s lawyer from even taking a case. It demonstrates that the employer acted reasonably and will limit or mitigate the damages that an employee can collect (i.e. it’s not worth the plaintiff lawyer's time or money, if he (or she) takes the case on contingency, and (2) it shows the employee considering litigation against your company what a “fair” result might be if he or she decides to pursue litigation. That is, if the employee has “made their case” to the investigator and believes that the investigator is fair and neutral, then the conclusion that the investigator makes, even if it is not the employee’s desired result, will be the likely conclusion that a judge or jury will make after hearing all of the same facts. At this point, the employee will hopefully realize that a lawsuit will be expensive, time consuming and possibly, pointless.

The six ways that a plaintiff’s lawyer can undermine or “attack” an investigation are:

o The “Neutrality” Attack
o The “Time” Attack
o The “Fair & Thorough” Attack
o The “Taint Free” Attack
o The “Retaliation” Attack
o The “Burden to Remedy” Attack

The details of these attacks are the subject of a program which I will be presenting to the attendees of PIHRA District 15 on August 17, 2010, 11:30am-1:30pm. If you are interested in learning more about them in an entertaining format, please register and attend: http://www.pihra15.org. Nonmembers are permitted to attend as well.

To demonstrate my gratitude to PIHRA in supporting Katz Consulting & Associates’ mission to proactively prevent lawsuits, I am also including downloadable Sample Documents that are helpful in conducting investigations of sexual harassment.
Sample Sexual Harassment Complaint Form*
Sample Investigation Questions for the Accused*
Sample Investigation Suspension with Pay for Accused*
Sample Investigation Conclusion and Recommendations*
*The samples are not intended to be "ready for use" by readers. In addition, they are not to be construed as legal advice. Rather, these forms are intended as samples and should be adapted to your particular company's needs. Although this work is copyrighted, you may freely use the content in creating or changing your own forms. I strongly encourage you to consult with a labor/employment attorney or contact me prior to using these forms within your company to ensure compliance.

California’s 4th Dispenses “Wild Justice”

On December 10, 2009, in Haberman v. Cengage Learning, 180 Cal.App.4th 365 (2009) the California Court of Appeals for the 4th Circuit affirmed the trial court’s summary judgment in favor of the employer on the employee’s claim that she was sexually harassed and retaliated against. The ruling in this case reminds me of a famous quote:

“Revenge is a kind of wild justice, which the more man's nature runs to, the more ought law to weed it out.” (Francis Bacon Sr.)

In this case, the Court of Appeals did not ignore the peculiar timing of the allegations made by Cengage Learning’s employee and ruled in favor of the employer, weeding out the “revenge” lawsuit at the summary judgment phase. The facts of this case reveal it as a “revenge” lawsuit.

Cengage Learning, a textbook publishing company, employed Alicia Haberman as a sales representative from 2004 through 2008. During her employment at Cengage Learning, Haberman underperformed, consistently failing to meet her annual sales goals. For years, this underperformance went virtually ignored, but in 2007, when Cengage Learning hired on a new district sales manager, Rick Reed, he began to hold Haberman accountable to her projected sales goals. Reed gave Haberman verbal and written notice of his expectation of her improvement. He created an action plan for her improvement as it pertained to her “gap to goal.” He discussed his concerns over Haberman’s failure to improve with the President, Vice-President and national sales manager of Cengage Learning. He gave Haberman a final chance to demonstrate improvement. On September 10, 2007, Reed told Haberman that if she did not show improvement she would be placed on a Performance Improvement Plan (PIP). Finally, on October 10, 2007, Reed placed Haberman on a PIP. Presumably, failing to meet the PIP would be grounds for dismissal.

A few days later, Haberman conveniently remembered that she had been sexually harassed for the past three years by the company’s national sales manager, Eric Bredenberg. On October 12, 2007, she made a complaint with Cengage Learning’s Human Resources department stating that she had “enough” and was being harassed. In November, she took a medical leave of absence and never returned to work. (Her employment was terminated effective August 31, 2008.)

In November 2007, Haberman filed a complaint in state court against Cengage Learning, Rick Reed and Eric Bredenberg alleging sexual harassment, retaliation, breach of contract and intentional infliction of emotional distress. The trial court granted the defendant’s motion of summary judgment. On appeal, the Court of Appeals reviewed the trial court’s decision and considered all the evidence set forth.

In her complaint, Haberman alleged she had been sexually harassed by Bredenberg in 2005 with comments he had made. These comments included “Wow. You look so pretty.” A school administrator was “pretty hot for being an older woman.” A comment that a supervisor’s father, named Richard, was called by his son of the same name, “Big Dick.” A comment that she was “drop dead gorgeous.” When driving his car behind her in a parking garage, a comment on the phone that he was “coming up right behind her and that it felt pretty good.” A comment that a text book author had “the hots” for her. A comment that his grief counselor advised him to wait before entering into another relationship and “did she know someone who just wanted to have sex?” In addition, these conversations were not one-sided. Court papers showed Haberman also sent emails and made comments to Bredenberg, such as, “Thank you Eric! You are too good!” “I think the picture of the week should have been a muscle pose of you!!!” In addition, Haberman alleged that another sales person who failed to meet sales goals was not placed on a PIP; therefore, her discipline was a mere pretext for harassment.

Usually, California trial courts do not grant summary judgment in harassment cases because any questions of fact should be decided by a jury after hearing the evidence rather than a judge based on his/her reading of the paperwork. However, in this case, the Court of Appeal carefully evaluated the evidence and concluded that the trial court correctly decided the motion and affirmed the court’s summary judgment. The Court found that although Haberman alleged harassment from 2004 through 2007 that the comments were sporadic, isolated, occasional and trivial falling short of meeting the “severe and pervasive” standard for a hostile work environment case. Second, the court rejected her allegation of retaliation since the alleged retaliatory conduct – the decision to put her on the PIP - actually predated her complaint to human resources and therefore could not have been in retaliation for her complaint. The Court similarly disposed of the breach of contract claim and intentional infliction of emotional distress claim.

What Proactive Lawsuit Prevention Strategies Did Cengage Learning Implement That Saved It from a Costly Lawsuit?

Cengage Learning Implemented Progressive Discipline and Gave Employees Ample Opportunities for Improvement
Cengage Learning provided Haberman with clear performance standards. Therefore, her supervisor had a clear, objective, well documented reason for placing Haberman on the PIP. She had been given many opportunities to improve. She had been given many warnings about her failure to improve. These disciplinary actions were documented. She had been given many opportunities and resources for improvement. Therefore, the court did not find her placement on a PIP a pretext to mask any harassment.

Cengage Learning Had a Grievance Procedure with Various Avenues for Employees to Complain
Once Haberman decided to complain, she did not have to complain to her direct supervisors, Rick Reed or Eric Bredenberg. She knew she could complain to her human resources (HR) department. Therefore, the fact that she never complained about the alleged ongoing harassment to another manager or to HR until after her job security was undermined made the timing of her complaint seem vengeful.

Cengage Learning’s Supervisors’ Did Not Date, Sexually Proposition or Physically Touch Their Supervisees
This case could have easily survived summary judgment if the alleged harassment went only one or two steps beyond inappropriate comments. If Bredenberg had sexually propositioned Haberman or even inappropriately touched her, the Court most likely would have allowed a jury to evaluate whether the conduct was “pervasive” or a “quid pro quo” thereby costing Cengage Learning many more thousands of dollars in litigation expenses.

What Proactive Lawsuit Prevention LEADERSHIP Strategies Should Cengage Learning Have Implemented? (In other words, how can you and your company better protect yourself from “revenge” lawsuits?)

To recap from my previous blog, Proactive Lawsuit Prevention Leadership Strategies invoke the highest standards of conduct. These strategies ask employers to internalize all the externalities inherent in employee relations, even the conflicts which may not necessarily give rise to litigation under the current laws or the externalities that a business is not forced to “pay for” by order of a court. Using Haberman v. Cengage Learning as an example, the company in this case could have demonstrated leadership and better protected itself with the following actions:

Cengage Learning Should Train Their Supervisor’s On the Appropriate Use of Email and Technology
Especially in today’s high tech world, companies must educate their managers about the appropriate use of technology in the corporate environment. The casual and sometimes inappropriate “conversations” documented time and again in email communications between Bredenberg and Haberman are glaringly obvious as “unprofessional” when presented as evidence in litigation. Email communications, voicemails, PDAs and the use of social media are becoming fodder for plaintiff’s counsel in these cases. Techno-harassment is emerging in increasing frequency in the case law. Cengage Learning should have trained its managers to anticipate that email is discoverable and to only put into email communication information that a manager would feel comfortable reading out loud in front of a jury.

Cengage Learning Should Train Managers Not To Talk About Their Sex Lives
Whether the details of a person’s sex or romantic life can trigger a sexual harassment lawsuit or not, managers should not discuss the details of their own romantic or sexual escapades with their coworkers or subordinates nor should they ever ask about someone else’s. This is an area that can easily offend the person listening to these stories or make others uncomfortable. Because the intent of the accused is often irrelevant or secondary to the offense of the receiver of harassment, these stories are unsuitable and too risky in the workplace and among coworkers.

Cengage Learning Should Train Managers to Always Treat Like Cases Alike
Although Cengage Learning was able to demonstrate that Haberman’s placement on a PIP was appropriate and that the other employee who was not placed on a PIP only missed sales goals for two years, (rather than the three years that Haberman missed) this was a near miss for Cengage Learning. The Company should ensure that performance standards and discipline are consistent and objective, rather than based on the subjective opinions or decisions of individual supervisors. If Cengage Learning had objective performance standards that it applied consistently, than Haberman would have been disciplined about her underperformance in the years prior to Reed’s hire. His suddenly holding her accountable would not have triggered her backlash lawsuit or incurred the “revenge” allegations. Treating like cases alike also increases the likelihood that a claim of discrimination or harassment is defeated.

Can you identify any other strategies that a company in this situation can implement to protect it from a “revenge” lawsuit?