Sexual Harassment by Customers—Employer Responsibility

Could You Be Liable If a Customer Harasses Your Employee? Employers must address sexual harassment by customers in addition to harassment by other employers. Courts can hold employers accountable if they fail to take reasonable actions to prohibit a hostile work environment and protect an employee. While the “customer is always right” is a maxim that people in business try to follow, under these circumstances the customer is not right. EEOC v. Costco Wholesale Corp. A case in point is the EEOC v. Costco Wholesale Corp. case. The U.S. Court of Appeals for the Seventh Circuit reviewed the case and in 2018 ruled in favor of the EEOC. Case Details A customer stalked a Costco employee for over a year. The employee reported the stalking to her managers. However, because the managers did not believe the harassment was severely sexual in nature, they did not take stronger actions quickly enough to prevent it. After some time, Costco did tell the customer to leave the employee alone. In fact, Costco eventually banned the customer from the store where the employee worked. However, these actions were taken after constant encounters that lasted over more than a year where the customer repeatedly stalked the employee. He constantly asked her personal questions, touched her on several occasions and then came in disguise to observe her and later on, even took a video of her. After her third interaction with the customer, the employee filed a police report about the stalking. Subsequently, the police called the Assistant General Manager about the report, and as a result he yelled at the employee and told her...

What New York Data Privacy and Security Protection Means for Employers

Employers Must Comply with New SHIELD Law In July of 2019, the New York legislature passed the “Stop Hacks and Improve Electronic Data Security” (SHIELD) act. The new law provides greater protection for private information and broadens requirements for security breach notification. Which NY Employers Must Comply with the Law? The SHIELD law applies to all NY employers because private information includes individual names and Social Security numbers. Businesses that do not reside in New York but that do business with New York residents are also subject to the law’s security requirements. What Does Private Information Include? Private information includes: Name Social Security Number (SSN) Driver’s license number Credit or debit card number Financial account number Biometric information Username or email address and password to online account What Is Necessary for Compliance? To be in compliance with SHIELD, employers must implement a data security program that keeps private information secure and adheres to the act. How extensive the program must be depends on the size of the company and its business activities and the sensitivity of the personal information it gathers. If the business is already in compliance with the following laws, they are also in compliance with SHIELD: Gramm-Leach-Bliley Act HIPPA Security Rule New York Site Department of Financial Services’ Cybersecurity Requirements for Financial Services Companies What Are the New Breach Notification Requirements? The new law expands the definition of breach of the security system. Breach now includes unauthorized access of computerized data that compromises: Security Confidentiality Integrity of private information Breach also now extends to New York residents and not only New York businesses. A company may...

No Mandatory Arbitration Under the NYS Anti-Sexual Harassment Law

Will the Provision Hold Up Under Higher Court Scrutiny? New York’s new anti-sexual harassment law states that New York employers may no longer include mandatory arbitration clauses for sexual harassment claims. Furthermore, settlements regarding sexual harassment claims may not include non-disclosure provisions. The exception would be when the complainant prefers to include such a provision. Reasons the Arbitration Provision May Not Stand In a recent case, Mahmoud Latif v. Morgan Stanley & Company, the company moved to compel arbitration of Latif’s claims based on their arbitration agreement. The arbitration agreement stated that covered claims would include statutory discrimination, harassment and retaliation claims. Latif alleged that he was sexually assaulted by a female supervisor, was subjected to inappropriate comments regarding his sexual orientation, inappropriate touching, sexual advances and offensive comments about his religion. He reported the incidents to the company’s Human Resources department. The only disputed aspect between the parties is whether the complaint is subject to the arbitration agreement based on the recently enacted New York anti-sexual harassment law. Ruling in the Case The judge granted Morgan Stanley’s motion to compel arbitration of the Latif claim. The reason given was that “the Federal Arbitration Act requires courts to enforce covered arbitration agreements according to their terms.” The judge stated that “the Supreme Court has instructed that the FAA reflects ‘both a liberal federal policy favoring arbitration and the fundamental principle that arbitration is a matter of contract.'” Basically, the federal law takes precedence over state law. State law is subject to preemption, which means that a higher court or authority displaces a lower court or authority regarding matters that...

What the New Anti-Sexual Harassment Law Means for NY Employers

Is There Liability You Could Face that You Did Not Face in the Past? The NYS new anti-harassment law has a number of sweeping changes. For one, it applies to all protected classes under New York Human Rights Law, not only to sexual harassment cases. Protected classes include discrimination based on: Age Creed Race Color Sex Sexual orientation National origin Marital status Domestic violence victim status Criminal or arrest record Predisposing genetic characteristics New Anti-Sexual Harassment Law Burden of Proof for a Hostile Work Environment The “Severe or Pervasive” Standard Under the previous law, to succeed in a claim, an employee suing an employer for discrimination had to prove that harassment was “severe and pervasive.” Rape or beating up an employee based on their protected class would be obvious examples of a severe act. More often though, the courts looked for pervasive harassment, such as continually making racial slurs or frequently touching the employee in a sexual way over a period of time. Workplace comments had to rise to the level of vulgar and humiliating verbal assaults rather than occasional teasing or jokes. In some instances, a combination of unwelcome physical acts, such as forcible touching and verbal abuse would meet the burden of proof. Unless employees could provide evidence that rose to that level of proof, they would not have an actionable claim. The New Burden of Proof: Rising Above “Petty Slights and Trivial Inconveniences” With the new law, the burden of proof has changed from “severe and pervasive” to “rising above petty slights and trivial inconveniences.” An affirmative defense for an employer is to prove that “the...

Two New York Bills Passed in June for Equal Pay

Equal Pay Continues to Be a Focus for New York Legislatures The New York legislature passed two laws that offer greater protection against wage discrimination. As employers, it is wise to stay abreast of new employment law amendments so you can ensure your business practices are up-to-date. New Law with Provisions Against Wage Discrimination The bill on wage differentials added provisions to labor law that further protect employees against wage discrimination. The law addressed “equal pay for equal work.” The usual protected classes for equal pay of age, race or gender now also include national origin, gender identity and express, military status, disability along with marital or family status and domestic violence victim status. Criteria Used for Determining Equal Pay According to the new bill, employers must pay workers based on the following criteria: Equal work performance involving equal skill, effort and responsibility Performance being done under similar working conditions Substantially similar work being done The exceptions that are a legitimate basis for pay differences include: Seniority systems Merit systems Systems that measure earnings by quantity or quality of production Bona fide factors (not sex), such as education, training or experience New Law Prohibiting Salary and Work Compensation Questions This bill prohibits employers from doing the following: Relying on wage or salary history to determine whether to employ a job applicant Using wage or salary history to determine the employee’s wages or salary In addition, employers must not ask for wage or salary history (orally or in writing) as a condition for: Interviewing the job applicant Considering whether or not to make a job offer Employing a job candidate...