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2 Huge 2016 HR Lawsuits to Learn From and Avoid

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Huge HR Lawsuits to Learn From and AvoidMistakes happen. Usually, we think of them as learning experiences and move on towards a more refined understanding. For the companies below, their HR mistakes led to costly disasters and PR nightmares—a devastating combo for any organization.

We are not in the business of airing others’ dirty laundry, however these lawsuits speak to the sheer importance of a comprehensive HR strategy, understanding of laws, and guiding principles that protect the organization and employees.

As you’ll see, failure to provide compliant, updated, and reviewed policies not only leaves an organization open to litigation, it can undermine culture and reputation as well.

Take a deep breath, read through these HR lawsuits, and review your own policies to ensure protection.

Limiting Employer Liability for Sexual Harassment

Our first examination relays the importance of having accessible, well-communicated policies.

The Case: Kandice Pullen allegedly was the victim of verbal and physical harassment by her supervisor more than once during her employment with the Caddo Parish School Board in Louisiana. Though she did not address her concerns, a coworker’s similar complaint pointed to Pullen as another potential subject to the sexual harassment she endured.

After the workplace investigation concluded, Pullen filed an Equal Employment Opportunity Commission discrimination charge.

The case went back and forth in the lower court, who initially ruled in favor of the school board, finding the employer had created a detailed sexual harassment policy that was found both on bulletin boards and online. Additionally, sexual harassment training was a common occurrence for a majority of the employees on a regular basis.

The ruling was reversed when witnesses testified that they had never been told of such a policy, where to locate it, or who they should speak to regarding concerns or complaints.

Lessons to Learn

It is critical that employers have a comprehensive policy for sexual harassment—and many other potential liabilities. It is equally critical that employees are made aware of these policies, where to find them, and to whom they should report any complaints.

The Caddo Parish School Board did well to protect itself in writing, but without awareness—it caused disputes in court that eviscerated the intention of the document.

  • Create a comprehensive sexual harassment policy
  • Communicate the policy with employees
  • Distribute the policy and ensure employees are aware of the policy’s location
  • Identify the HR professional or manager responsible for reporting concerns
  • Be open to questions and concerns

Whistleblower Sues Wells Fargo

The Case: 2016 was a devastating year for Wells Fargo. After news broke that over 2 million unauthorized accounts had been created for existing customers since 2011 to meet sales targets, Wells Fargo agreed to pay a penalty of $185 million in fines and an additional $5 million to refund customers.

In an effort to save a modicum of its reputation, Wells Fargo fired over 5,300 employees. Then, just as the disastrous year was about to end, the whistleblower responsible for reporting the unethical activity filed a federal lawsuit against the bank, claiming harassment after her initial reporting.

Currently underway, the allegations are shocking: poor performance evaluations, relieving of management duties, branch transference, denial of pay increases, wage reduction, and ultimately termination of employment in 2015.

If backed by evidence and the court, these are telltale signs of workplace retaliation.

Lessons to Learn

There are a lot of lessons for business owners to take from the ongoing plight of Wells Fargo.

  • Supervisors and supervision are not enough to ensure best practices are at play within your organization. Evaluations and employee development assist in locating disruptive behavior.
  • HR must handle each case with impartiality and use thorough investigative methods. If in doubt, outside investigators are available to conduct unbiased, timely investigations.
  • The Whistleblower Protection Act of 1989 is a federal law, protecting employees from precisely what the Wells Fargo employee allegedly underwent. Management and employees must be made aware of these laws and other OSHA statutes to protect the organization from contentious litigation.

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