Most employers are aware that they can be held liable for a supervisor’s or coworker’s harassment of an employee under Title VII of the Civil Rights Act. However, employers often fail to realize that under certain circumstances, they can also be liable for harassment committed by their clients, customers or vendors.
Title VII places a duty upon the employer to maintain a workplace free from harassment — from whatever source. The Equal Employment Opportunity Commission (EEOC) has enforced this principle on multiple occasions. Employers may be held responsible for acts committed by non-employees, including customers, if the employer: (1) knew or should have known about the unlawful behavior of the customer; and (2) fails to take immediate corrective action.
How does a company respond to such allegations? Traditionally, businesses are concerned with the financial consequences. Addressing the harassment can lead to a loss of an important customer. Employees subjected to customer harassment are in a difficult situation from a reporting standpoint. Many employees feel they cannot complain because the outcome may result in a loss of business for their employer.
As stated above, the standard does not require your employee to complain about the customer’s harassment. If the employer witnesses the harassment or “should have known” of the situation, liability can result. Employers should never engage in conduct which deters an employee from complaining about harassment and should always take such complaints seriously to alleviate any employee concerns about reporting. Here are some steps that should be considered:
1. Make sure your harassment policy addresses harassment by third parties or customers. Your policy should not be limited to harassment by coworkers. It should address how employees can complain and specifically state that employees should not fear retaliation or reprisal if they submit a complaint of harassment.
2. Provide training to your supervisors and employees as to how they should react if they experience sexual harassment by a customer. In many industries, harassment is not uncommon (for example, hotels, casinos, restaurants, bars, healthcare and nursing). You should provide your employees the tools and training to deal with these uncomfortable situations. This may help stop further harassment by a customer and limit the complaints that you receive.
3. If an employee alleges harassment by a customer, it is imperative that the company investigate and take prompt, affirmative steps to end harassment. Always make sure that these complaints are taken seriously and that employees feel supported. Affirmative steps may include removing the employee from dealing with the customer and having another employee to help service the customer.
While these steps are sometimes difficult to implement, they are much easier and cheaper than the alternative, a lawsuit.