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Investigate or else! When harassment surfaces, HR inquiries and action could be worth millions

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in Discrimination and Harassment,HR Management,Human Resources

If you can’t find a way to end persistent workplace harassment, a court may conclude that your organization acted recklessly in denying an employee’s civil rights. That may mean you’ll owe a huge punitive damages award.

If it looks like simple efforts (such as painting over graffiti and conducting anti-harassment training) aren’t stopping the harassment, call on expert help.

Recent case: Otto worked on a Chrysler assembly line. Otto’s family history is complicated, but also the basis for the harassment he claimed he suffered at work. His Jewish grand­father emigrated from Germany to Cuba in 1911 and married a Cuban woman. Raised Christian, Otto fled Cuba as a child with his family after Fidel Castro took over. He converted back to Juda­ism when he married, and now identifies himself as Jewish.

In 2002, Otto claimed that someone vandalized his cars, parked in a Chrysler parking lot, by pouring sugar into the gas tanks and cutting the tires. He reported this to police and to HR, but Chrysler didn’t respond. Finally, after calling Chrysler’s HQ, someone in HR suggested he park in a different lot.

Then graffiti started appearing on the walls, and notes showed up in Otto’s toolbox. Over the next three years, Otto regularly received death threats, including notes that said, “Death to the Cuban Jew,” “Good Jew is a dead Jew,” “Get the Cuban Jew,” and “Your family is not safe we will get you.” Many of the notes and graffiti included swastikas.

Plus, someone dressed a dead bird like a KKK member in a sheet and placed it in a vise at Otto’s work­station.

Otto kept complaining to HR, which took little action. The graffiti was removed after a few days, but the identity of the harasser was never determined. It later turned out that HR suspected Otto had mental problems and was “harassing” himself. Other than one employee meeting called to discuss the company harassment policy, it did nothing else to stop the notes and graffiti.

Otto sued and a jury awarded him $709,000 in compensatory damages—plus a whopping $3.5 million in punitive damages. The trial judge dismissed the punitive damages and Otto appealed.

Now the 7th Circuit Court of Appeals has reinstated the punitive damages award. It concluded that Chrysler acted recklessly when it didn’t escalate its efforts to stop the harassment. The court also looked askance at Chrysler’s efforts to prove that Otto was the culprit and noted that the jury didn’t believe that was the case. (May v. Chrysler, No. 11-3000, 7th Cir., 2012)

Final note: What could Chrysler have done to stop the harassment? The court suggested that under the circumstances, installing surveillance cameras and entry locks that tracked employees coming and going would have helped.

In addition, Chrysler should have focused on figuring out who the culprits were instead of engaging in a seemingly intense effort to prove Otto was setting them up. For ex­­ample, Chrysler focused on getting handwriting analysis of the notes and graffiti and comparing the writing to Otto’s at the exclusion of many others in the plant.

The court said it should have done more.

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