May 01, 2008

How Bad Is the Behavior? Pretty Egregious for Punitive Damages

The EEOC is getting a lot of press for a $1 million jury verdict in a harassment case against agri-giant Harris Farms that was recently upheld by the Ninth Circuit. The verdict included the maximum $300,000 for punitive damages allowed under federal law. I have to admit, the numbers alone piqued my interest. And I wondered--how serious does an employer's activity or inactivity have to be to justify that kind of punitive damages award? So I found the lower court's unpublished opinion, explaining why it denied Harris Farms' request for judgment as a matter of law with respect to punitive damages. Essentially, this was a request that the jury verdict be overturned because there wasn't legally sufficient evidence that the defendant acted in "malice or reckless disregard" of the plaintiff's rights, the legal standard for punitive damages. Here's a summary of the reasons the court determined the defendant's behavior could be "reckless disregard": * The defendant's written sexual harassment policy was out of date, and didn't even include a retaliation provision. Company executives knew it was out of date and didn't do anything about it. * When the plaintiff made her complaints, translations of reports or interviews were inaccurate. * After complaining of a physical incident in which she was grabbed by the harasser, the plaintiff was sent to work in a field by his home. When he made the assignment, her direct supervisor said he didn't know she'd filed a complaint or that the two should be kept apart. When the plaintiff complained the harasser drove slowly back and forth by the field, the employer didn't take any formal action. * Two days later, the plaintiff reported to human resources that the harasser had raped her. Though they'd called the police about the grabbing incident, they didn't report the rapes and they didn't interview the harasser about them until 6 weeks later. * In the midst of all this, the plaintiff complained to human resources that co-workers were spreading sex-related rumors about her. She said she was scared, and requested not to work alone. The request was denied, and eventually the plaintiff was investigated and disciplined for participating in gossip and making sexually inappropriate comments. I understand that limiting damages is a big concern for most employers. In fact, this fear has led to some great strides in the context of harassment--training, clear policies, understandable procedures. Given that, a verdict like this can be a scary one. Maybe. I thought this might be a test case--one that would give some very clear guidance and put pressure on employers to tread carefully. Though it's not without its lessons (and obviously doesn't set a standard in every case), it also affirms a lot of practices conscientious employers are already following. Have an up-to-date policy. Investigate immediately. Report incidents of physical sexual assault to local authorities. I don't know that we needed a $1 million jury verdict to tell us that. Alayna Schroeder