CHAPTER 15 —
TRAINING REALLY IS THE LAW:
THE RISE OF MANDATORY TRAINING

§ 15.1

I. RECENT TRENDS & DEVELOPMENTS

§ 15.1.1

A. INTRODUCTION

As of 2004, nearly every employer in the United States has mandatory employment law training obligations. Thus, the evolution of employment law training from a "nice idea" to legal imperative is now complete. Training is now required on topics such as harassment, business ethics, whistleblower protection, and safety. The mandate goes beyond the mere provision of training as quality standards are also obligatory. Such intensive training on such wide ranging topics will affect nearly every interaction an organization has with its employees.

It would be easy to narrowly focus on these relatively new mandates. Yet, wise employers were conducting employment law training years before the mandates were passed. Why? These employers realized that the investment in employment law training is one that pays for itself through lower litigation costs and less time spent dealing with vexing complaints. This section summarizes the more recent laws that make training obligatory and the business reasons that make training advisable.

§ 15.1.2

B. MANDATORY TRAINING

§ 15.1.2(a)

California's New Mandatory Harassment Training Requirement

Preventing Workplace Harassment

In 2004, California joined Connecticut and Maine in requiring that private employers train their managers on preventing workplace harassment, especially sexual harassment.¹ The California law, AB 1825, goes beyond the relatively straightforward requirements of these other states by significantly regulating the subject matter, quality, and delivery method of training.

Who Must Train and How Much Training

AB 1825 applies only to entities that regularly employ 50 or more employees or regularly receive the services of 50 or more persons pursuant to a contract. Presumably the "receiving services" language is an attempt to avoid deciding if a worker is an employee or independent contractor. Although not specified by the statute, courts have held that Fair Employment and Housing Act's (FEHA) other minimum employee requirements count only employees working in California. It is likely the training requirement covers supervisors located outside of California but managing those within the state.²

AB 1825 does not define "supervisory employee," and that term is not defines in FEHA's other sections. FEHA does use the term "supervisor," defining it as any individual having the authority "to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or the responsibility to direct them, or to adjust their grievances, or effectively to recommend that action . . . if the exercise of that authority is not of a merely routine or clerical nature, but requires the use of independent judgment."³ Are the terms supervisor and supervisory employee synonyms? The answer is unclear, although some cases indicate that "supervisory" duties are broader than those assigned to management employees.⁴

The Subject Matter of Training

AB 1825 also sets specific quality standards for the required training. The training must be conducted via "classroom or other effective interactive training" and include the following topics:

information and practical guidance regarding the federal and state statutory provisions concerning the prohibition against and the prevention of sexual harassment;
information about the correction of sexual harassment and the remedies available to victims of sexual harassment in employment; and
practical examples aimed at instructing supervisors in the prevention of harassment, discrimination, and retaliation.

The mandates extend to those presenting the training. The training can only be presented by "trainers or educators with knowledge and expertise" in preventing harassment, discrimination, and retaliation.

§ 15.1.2(b)

Ethics & Compliance Training Under Amended Federal Sentencing Guidelines

In response to the Sarbanes-Oxley Act of 2002, the U.S. Sentencing Commission amended their Sentencing Guidelines in 2004 to strengthen the requirements for corporate compliance. Under the amended guidelines, judges were required to consider whether a convicted corporation had established an "effective compliance program" prior to the violation taking place; in other words, whether the corporation had taken appropriate steps to prevent and detect violations of ethics laws. The 2004 amendment imposed the requirement that all employees, including high-level personnel, receive periodic training pertaining to their organization's ethics and compliance standards.

Consequently, comprehensive and periodic training on workplace ethics to prevent and detect criminal conduct has now become an ever greater imperative. If an organization undergoes scrutiny regarding its ethics and compliance practices under Sarbanes-Oxley or other federal statutes, evidence of an effective ethics and compliance program will significantly reduce liability exposure. Simply demonstrating that you have provided employees with an ethics policy or code of conduct is not legally sufficient; a formal training program is required under the amended guidelines.

In January 2005, the United States Supreme Court set aside part of the federal sentencing guidelines in a case concerning pronounced sentences for drug offenses.⁵ While not addressing the guidelines' corporate application in its opinion, the Court's decision has effectively left the "mandatory" nature of Sarbanes-Oxley sentencing guidelines unclear. However, the Court did find that judges should continue to consult the guidelines in determining sentences on an advisory basis at least until Congress can reconsider the mandatory nature of the sentencing scheme. Thus, employers looking to keep their officers out of court, would be well advised to consider ethics training as mandatory.

Until more specific guidance is issued, organizations will be well served to address the following as they implement ethics and compliance standards:

Can your organization demonstrate a commitment to compliance with ethics law at the "highest levels" of management?
Is compliance training universally provided to all employees, and is periodic evaluation of the effectiveness of compliance programs taking place?
Among specific topics to address in the training, are the following areas covered?

confidential information;
insider trading;
conflicts of interest;
proper accounting practices;
Sarbanes-Oxley Act requirements – particularly, understanding antiretaliation and whistleblower protections of this and other laws;
proper financial reporting procedures and financial records maintenance;
use of organizational property;
handling gifts and favors; and
reporting ethical and compliance concerns under your organization's policies.

§ 15.1.2(c)

Training as a Mandatory Part of the "Faragher, Ellerth Defense" to Workplace Harassment and the "Kolstad Defense" to Punitive Damages.

State Supreme Courts and Lower Federal Courts Take the Lead in Emphasizing Training

During 1998 and 1999, the U.S. Supreme Court's triptych of decisions in Faragher, Ellerth, and Kolstad put employment law training on the agenda of any HR professionals looking to avoid litigation. While the U.S. Supreme Court has since been relatively quiet on the subject, other federal courts and state supreme courts have taken the lead. These courts show an emerging trend that training may be an essential part of establishing an affirmative defense in harassment litigation or punitive damages in discrimination litigation.

Example of Training Being a Necessary Part of an Affirmative Defense to Harassment Litigation

Federal and state courts in certain jurisdictions have held that training managers on preventing workplace harassment is an essential element in establishing the Faragher/Ellerth affirmative defense.⁶ The line of cases from these courts hold that merely having a harassment policy is not enough to satisfy Faragher/Ellerth. In addition, employers must show the following:⁷

training for the company's supervisors regarding harassment;
an express antiretaliation provision; and
multiple complaint channels for reporting the harassing conduct.

The decision in Soto v John Morrell & Co., shows just how stringent courts have become in requiring the first prong (training) of the above stated test. In that case, the employer promulgated its harassment policy in a separate document in both English and Spanish. All employees received a copy of the policy at orientation, and annually thereafter, and were required to sign an acknowledgement. This acknowledgement stated that the employee had received the policy and gave the company's specific contact information for its EEO officer. The personnel and training departments displayed large posters detailing the company's antiharassment policy. Finally, the employer's president sent a letter to all employees, including the plaintiff, reminding them that harassment was against company policy.

This proactive, consistent approach to preventing workplace harassment was impressive. Yet, it failed to include one essential element – manager training. Managers were required to be trained yearly but that requirement apparently went unfulfilled. The Director of Human Resources did speak with managers yearly on the subject, claiming this was "training." His testimony fell apart upon examination by the plaintiff's attorney where the Director admitted that he had given managers no tools or script on how to train employees.⁸

Based on this testimony, the employer could not verify that he had provided training to the plaintiff's manager. Thus, the court denied the employer's request for summary judgment on the affirmative defense and let the case proceed to trial.⁹

The New Jersey Supreme Court delivered possibly the most emphatic statement about the need for employment law training.¹⁰ In that case, Maria Gaines, a Corrections Officer, alleged that her shift supervisor grabbed her face and kissed her against her will while the two were alone in the jail. Although Gaines reported this misconduct to one of her supervisors, the supervisor did not report this incident to his superiors because the county had not provided him with any anti-sexual harassment training. (In fact, several corrections officers testified that they had not received any training concerning the county's sexual harassment policy.) Gaines' allegations were ultimately brought to the attention of the county's Director of Personnel as a result of Gaines' deposition testimony in an unrelated case. Following an internal investigation of her claims, the county suspended the supervisor, who retired shortly thereafter.

The New Jersey Supreme Court held that, in the absence of managerial and supervisory training, triable issues existed as to the effectiveness of the county's antiharassment policy and as to whether that policy could shield the county from vicarious liability for the supervisor's misconduct.

In a previous decision, the New Jersey Supreme Court held that an employer may be held vicariously liable under New Jersey L.A.D. for a supervisor's misconduct when the employer was negligent in preventing workplace sexual harassment by that individual. The Gaines court emphasized that numerous factors are relevant to this determination, including whether the employer provided "mandatory" antiharassment training for its supervisors and managers, and also made that training available to all employees in its organization.¹¹ The court also rejected the county's argument that Gaines' failure to file a formal complaint pursuant to the antiharassment policy barred her claims. The court stated that an employee's inaction must be viewed in the context of whether the employer provided meaningful assistance to the employee who sought to complain about a supervisor's harassment. Concluding that an antiharassment policy "must be more than the mere words encapsulated in the policy," the court stated that such a policy must demonstrate an employer's "unequivocal commitment from the top" to preventing workplace sexual harassment.¹² According to the court, the absence of "effective preventive mechanisms," such as training, will present strong evidence that an employer was negligent in monitoring and preventing workplace sexual harassment. Based upon the record facts, the court held that Gaines' complaint should not have been dismissed because factual issues existed concerning the effectiveness of the county's antiharassment policy.¹³

Following the Gaines decision, the United States District Court for New Jersey formalized New Jersey's defenses to negligence-based claims of harassment as follows:

Effective preventative mechanisms, the New Jersey Supreme Court has observed, generally consist of four basic components: (1) formal policies which explicitly prohibit workplace harassment; (2) formal and informal complaint structures and procedures for promptly and thoroughly investigating and remediating claims; (3) training which is mandatory for supervisors and managers and made available to all other employees; and (4) some effective "sensing or monitoring mechanisms" to find out if the policies and complaint structures are trusted. Courts have also required that an employer demonstrate that it took affirmative steps to educate its employees about its policies and procedures.¹⁴

The Faragher/Ellerth defense spurred many employers to conduct harassment prevention training. Does the rejection of the defense by the California Supreme Court mean that such training is useless in California? No, it does not. In fact, employers should draw the opposite conclusion – that harassment training is more important than ever.

There is simply no margin for error when it comes to harassment by California managers. Put another way, the only way California employers can avoid liability for harassment by their managers is to ensure that the managers to do not commit harassment. This means that manager training must not only occur but that the training must be effective. "Check the box" training programs will no longer work (if they ever did) because there is no defense box left to check.

The lack of an affirmative defense, coupled with the new training obligation under California AB 1825 means that a prudent employer will focus on providing training that is effective and regular.

Avoiding Punitive Damages with Live, Interactive Training

In a recent case, the U.S. Court of Appeals for the Fourth Circuit so steadfastly adhered to the principle that punitive damages can be avoided that it actually overturned a jury's award of punitive damages because of the employer's good faith efforts (including live, interactive training) to proactively prevent workplace discrimination.

In Bryant v. Aiken Regional Medical Center Inc .,¹⁵ a jury found that the plaintiff had been denied promotions because of her race and because she had complained about discrimination (retaliation). The jury also decided that the employer should be castigated for the actions of its managers and awarded Bryant an extra $210,000 in punitive damages.

The court agreed with the jury's decision regarding discrimination and retaliation. However, it disagreed with the jury's punitive damages decision. The court noted that employers are not subject to punitive damages when individual manager's unlawful decisions were made "contrary to the employer's good faith efforts" to comply with federal antidiscrimination law. The court emphasized that the employer's good faith efforts, included:

Issuance and communication of an organization-wide equal employment opportunity policy.
Training of employees in a "carefully developed," classroom program that included interactive group exercises.
Voluntarily monitoring departmental demographics to help spot any issues of discrimination.

Contrasting these "extensive" actions with those of employers who never issued antidiscrimination policies or trained their managers, the court reversed the $210,000 punitive damages award.¹⁶

§ 15.1.2(d)

Mandatory Harassment Training on the Full Range of Protected Categories

Employers who focus their workplace harassment efforts exclusively on sexual harassment expose themselves to liability and damages on harassment based on other protected categories.¹⁷ In recent cases, employers have attempted to use the fact of having conducted sexual harassment training to defend claims based on race or other protected categories. The courts have routinely rebuffed these efforts holding that training on sex does not accredit to the employer's efforts to prevent other types of unlawful harassment.¹⁸

Training for Those Conducting the Investigations

Training programs to prevent discrimination and harassment tend to focus on managers and employees. These programs often recommend that employees call the Human Resources or Legal departments if serious issues arise for a more complete investigation. Thus, the skills of those conducting the investigations and making recommendations on appropriate remedial action must be up to date. The failure to do so can ruin any attempt to avoid litigation, as one employer learned in Schnoop v. Rotary Corp.¹⁹ In reviewing the employer's efforts to prevent harassment, the court noted "most importantly, . . . trained professionals in place to address it [racial and sexual harassment] were nonexistent."²⁰ Thus, the employer's attempt to escape liability was denied.

The"No Margin of Error" Philosophy Arises for Wage & Hour Compliance

Training managers on the basic requirements of wage and hour law has become crucial even though there is no direct requirement to do so. The wage and hour class action has become the "plaintiff's attorney's best friend." In California, the number of wage and hour class actions now outnumber those filed for discrimination. These class actions can be devastating on employers. Not only do they often result in multi-million dollar verdicts or settlement, they tend to effect large portions of the workforce. For example, the parties recently settled for $210 million (including post judgment interest and other fees) the appeal of a $90 million verdict against a major insurance company who misclassified 2400 employees as overtime exempt.²¹ Especially frustrating for employers is how quickly failing to pay for only tiny increments of hours worked can accumulate. Recently, a national chain of electronics stores agreed to pay $5.4 million to settle a dispute regarding its payment of overtime to employees. This huge dollar amount was generated from allegations that some 70,000 current and former workers were not paid for relatively small amounts of missed time including meal breaks, after employees punched out on the time clock, and while they waited for managers to unlock doors at the end of shifts. The problem was exacerbated by the fact that the retailer did not keep an accurate record of hours worked by employees as required by the FLSA.²²
This legal environment leaves no room for error for allowing even "minor" violations of wage and hour laws. Managers who know the basics about the employers' obligation are the first line of defense in preventing these minor infractions from occurring. In the case involving the national retailer, who would best know if the employees were taking their lunch breaks or if their time records were accurate? The answer is the local managers. However, very few companies train managers on the importance of keeping accurate time records or legal intricacies of what are "hours worked."

Management Skills Training and the Employment Law Connection

Several recent surveys and studies point to one conclusion – managers who fairly and professionally administer the performance and termination process are less likely to be sued and, if sued, less likely to be subject to punitive damages.²³ For example, the American Bar Association recently conducted a mock disability discrimination trial, with evidence strongly favoring the employer. When the jurors retired to consider the case, the acting judge announced that, were this a real trial, he would have dismissed the case because no reasonable jury could find for the plaintiff. Yet, the jury disagreed, finding that the plaintiff was not treated "fairly." Although this consideration that was legally irrelevant, the jury recommended a multimillion-dollar damage award.²⁴

Other surveys buttress the key finding of the mock trial. One study of the unemployed found that terminated employees found that only 4% of employees who felt their terminations were fair filed or considered litigation. Contrast that statistic with the statistics of those who felt that the termination process was insulting or felt that they had been given inaccurate information about the decision. A full 90% of that group either filed or considered litigation. The news is not much better for employers once they are before a jury. In another recent survey, most jurors disagreed with the statement "employees can be terminated without cause" even in states where employment at-will was the norm. Many jurors also disagreed that financial reasons were a legitimate reason for termination.²⁵

The lessons from these surveys are clear. Management skills training and employment law basics training are connected. Yes, managers do need training on basic management skills. But this training must be linked with the legal obligations of the organization. Only by linking the two subjects (skills and compliance) can organizations best hope to avoid and defend wrongful termination litigation.

§ 15.1.3

C. THE BUSINESS OF WORKPLACE TRAINING

Employment Law Training Reduced Costs

The application of basic business principles in large degree has kept the interest in training strong. Even as the economy has recovered somewhat from the recession of the past few years, HR professionals know that there "will be no money free for all" and that HR will continue to have to "do more with less."²⁶ The simple fact remains that fewer resources will be available than in the past and that the organization's remaining "human resources" must be better trained to carry out the organization's objectives.²⁷ As one expert stated:

I have consistently heard warnings that training budgets will be reduced due to a variety of circumstances. But I've never seen a business unit cut training that directly achieves business goals. . . . [Training that] advances business goals isn't an option; it's essential.²⁸

Employment law training helps meet core business goals, and thus, must be viewed as "essential." In lean or good economic times, a core goal of any organization must be to reduce unnecessary costs and focus resources on building for the future. The average jury award for wrongful termination claims is $1,800,000 and one-fifth of jury awards now top the $1,000,000 mark.²⁹ Indeed the total amount that employers pay out as a result of harassment and discrimination claims has doubled in the last five years.³⁰

Safety nets such as EPL insurance are costly themselves. Recent surveys show that premiums for this type of insurance have recently risen 50% and that employers can expect additional increases in premiums in the upcoming year.³¹ With employment litigation insurance premiums dramatically increasing, employers who cannot effectively manage employment law obligations will find themselves paying a huge bill.³² Even without litigation, the cost of employment law related disputes is high. One study found that large corporations spend $6.7 million per year dealing with harassment claims in addition to litigation costs.³³

The extravagant costs of employment litigation and protective insurance must be reduced to meet the core business goals of reducing non-productive costs. Employment law training programs, when done correctly, provide such a reduction. For example, after implementing a comprehensive employment law training program run by Littler Mendelson, the State of Washington realized a 37% decrease in employment law related claims. This saved the state an estimated $2 million per year. These facts comport with the experiences of human resources professionals nationwide. Eighty-two percent of those surveyed found that employment law training to be effective or extremely effective in reducing litigation.³⁴ Indeed, with the average cost to settle a lawsuit hovering at $300,000, a training program that eliminates even one lawsuit presents an amazing return on investment.³⁵

Employment Law Training Promotes Productivity

Employment law training can help reduce litigation costs and it can do more. Such training can improve productivity, a key goal for every employer regardless of the state of the economy. Productivity gains are especially noticeable for the "management lifecycle" programs such as lawful hiring, dealing with problem performance, and terminations. These programs teach managers the core skills needed to hire and retain their best employees and maximizing the performance of the entire workforce. Such efforts can also provide organizations with positive public relations. At the decade's start, the business headlines sensationalized Coca-Cola's $192.5 million settlement of discrimination class action. Last year, after introducing mandatory training for managers on equal employment issues, the company is earning public praise for its diversity efforts.³⁶

Technological Advances

Training's continued strength was further promoted by advances in technology, allowing organizations to do more training with less resources. Early predictions that by the year 2000 the primary method of delivering training to employees would be on-line proved overly optimistic.³⁷ Yet, the future may have finally arrived.

Advancements in "live" on-line training, through virtual classrooms and webinars, have ameliorated some of the concerns with traditional, self-study e-learning. Live on-line learning allows organizations to combine the best features of classroom training (e.g., use of engaging subject matter experts, participants having questions answered in real time, and team building) with many of the cost saving features that self-study e-learning allows. Indeed, one organization reported a $90,000 savings using live on-line learning to train over 500 employees on harassment prevention.³⁸ It is this combination of benefits that will likely make live on-line learning the "successor to traditional . . . classroom training."³⁹

§ 15.1.4

D. CONCLUSION

Sexual harassment training is now required by the law of many states. Federal and state courts require harassment and discrimination training to avoid punitive damagers. Sarbanes-Oxley requires ethics training as part of sentencing guidelines. These mandates further underscore what prudent employers have known for years, training, done correctly, can be a vital part of improving morale and productivity. Fortunately, technology trends have made conducting such training easier and more cost-effective than ever before. For employers looking to do the right thing by their organizations, employment law training serves both compliance and productivity goals.

§ 15.2

II. OVERVIEW OF THE LAW OF TRAINING

§ 15.2.1

A. MANDATORY HARASSMENT PREVENTION TRAINING FOR PRIVATE EMPLOYERS

Legal authorities, whether the legislatures or courts, have traditionally been reluctant to require employers to provide training. That attitude has changed the last few years have brought a variety of new training mandates.

§ 15.2.1(a)

Mandatory Sexual Harassment Training Under California Law

The wise course of action to conduct regular harassment training becomes a legal responsibility since Governor Arnold Schwarzenegger signed Assembly Bill 1825 on September 29, 2004.

AB 1825 (new Government Code section 12950.1; text available at www.leginfo.ca.gov) requires that employers train supervisors on sexual harassment every two years. At first glance, the statute only seems to codify what many employers are already doing. A close reading of the statute, however, reveals very specific requirements that every employer must now follow.⁴⁰

The Theory Behind AB 1825

AB 1825's legislative history provides some explanation of the law's rationale. The statute was sponsored by Assembly woman Sarah Reyes. Her basic argument was that current laws, while prohibiting sexual harassment, have not done enough to eliminate the problem. Reyes notes that during the 2002-03 fiscal year, 4,231 sexual harassment cases were filed with the Department of Fair Employment and Housing (DFEH), totaling 22% of all cases filed. The impact of sexual harassment on businesses is significant, Reyes argued. Harassment costs the average Fortune 500 company $6.7 million per year in indirect costs alone. Training helps reduce those costs. According to the Hartford Business Journal, "Most legally sophisticated companies provide such training to all supervisory and nonsupervisory employees. That's the smart thing for small and large employers to do to minimize their legal exposure to [sexual harassment] claims."

Who Must Train, How Much Training, and How Often

The law imposes an initial and continual training requirement on covered employers. By January 1, 2006, employers must provide two hours of sexual harassment training and education to all supervisory employees who are employed as of July 1, 2005. Employers that already provided such training to a supervisory employee in or after 2003 would be exempt from this initial requirement as to any such supervisory employee. After January 1, 2006, covered employers must provide sexual harassment training and education to each supervisory employee once every two years, and to each new supervisory employee within AB 1825 does not define "supervisory employee," and that term is not defined in FEHA's other sections. FEHA does use the term "supervisor," defining it as any individual having the authority "to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees, or the responsibility to direct them, or to adjust their grievances, or effectively to recommend that action . . . if the exercise of that authority is not of a merely routine or clerical nature, but requires the use of independent judgment."⁴¹ Are the terms supervisor and supervisory employee synonyms? The answer is unclear. Courts seem to use the two terms interchangeably at times. There have been cases where the court indicated that "supervisory" duties are broader than those assigned to management employees for the purposes of respondent superior.⁴² Since it seems to be significantly more beneficial to train even low-level supervisors, its seems prudent to provide these employees with at-least the minimum training required by AB 1825.

Specifics of the Training Requirement

AB 1825 also sets specific quality standards for the required training. The training must be conducted via "classroom or other effective interactive training" and include the following topics:

Information and practical guidance regarding the federal and state statutory provisions concerning the prohibition against and the prevention of sexual harassment.
Information about the correction of sexual harassment and the remedies available to victims of sexual harassment in employment.
Practical examples aimed at instructing supervisors in the prevention of harassment, discrimination, and retaliation.

The quality mandate extends to those presenting the training. The training can only be presented by "trainers or educators with knowledge and expertise" in preventing harassment, discrimination, and retaliation.

The quality standards require an employer to closely examine its training programs. Merely sitting a supervisor down and having her or him view a video or non-interactive web-based product – "show and go" – would likely not meet the statutory requirements to conduct "classroom . . . or . . . effective interactive training and education." Would classroom training by someone who has done a significant amount of harassment training but who has no practical experience preventing harassment meet the requirement to have the training conducted by those with "knowledge and expertise" in preventing harassment, discrimination, and retaliation? Although not entirely certain, the answer will likely be "no." Given this uncertainty, the most prudent approach is to use trainers and training organizations with both a solid training and harassment prevention background regardless of whether the training is done live or on-line.

The statute provides a floor, not a ceiling, for an employer's harassment prevention efforts. The FEHA makes it an unlawful practice for an employer to fail to take "all reasonable steps" necessary to prevent harassment from occurring. Providing the required training will be one step, but only one step, in meeting this requirement. Indeed, AB 1825 does not "discourage or relieve any employer from providing for longer, more frequent, or more elaborate training and education regarding workplace harassment or other forms of unlawful discrimination in order to meet its obligations to take all reasonable steps necessary to prevent and correct harassment and discrimination."

The statute's invitation to go beyond its minimum requirements should be accepted by employers. In particular, employers should provide extra training (additional classes or training longer than two hours) that covers all the protected categories under both federal and state antidiscrimination laws. The EEOC in its 1999 guidance on preventing liability for workplace harassment made this point definitively:

An employer should ensure that its supervisors and managers understand their responsibilities under the organization's antiharassment policy and complaint procedure. Periodic training of those individuals can help achieve that result. Such training should explain the types of conduct that violate the employer's antiharassment policy; the seriousness of the policy; the responsibilities of supervisors and managers when they learn of alleged harassment; and the prohibition against retaliation.⁴³

Already courts have held that training which is limited exclusively to sexual harassment will be of no value in defense of a race, national origin, color, age, or disability harassment case.⁴⁴ In fact, such limited training could backfire. For example, a plaintiff could argue that the employer was such a "minimalist" that only the statutory sexual harassment training was done. This minimalist approach, a plaintiff could then argue, shows a lack of respect or importance being placed on racial harassment, for example.

The Effects of Doing It Wrong and Getting It Right

The good news for employers is that, under AB 1825, a claim that training failed to reach a particular individual does not automatically result in the liability of an employer for subsequent harassment. It should be recognized that plaintiffs (or plaintiffs' attorneys) will almost certainly argue that the failure to meet the new training mandates is partial evidence of an employer's failure to take all reasonable steps to prevent harassment. The bad news is that an employer's compliance with the statute does not automatically insulate it from liability for sexual harassment of any current or former employee or applicant. If an employer violates any of the statute's mandates, the DFEH must issue an order requiring compliance.

§ 15.2.1(b)

Mandatory Sexual Harassment Training Under Connecticut Law

The Connecticut Human Rights and Opportunities Act requires all mandatory sexual harassment training under Connecticut law, private and public employers with 50 or more employees to provide two hours of sexual harassment training and education to all supervisory employees, and to all new supervisory employees within six months of the assumption of a supervisory position.⁴⁵ This statute's regulations provide significant detail on how to meet this mandate.⁴⁶

The training must be conducted in a classroom-like setting, using clear and understandable language and in a format that allows participants to ask questions and receive answers. Audio, video and other teaching aides may be utilized to increase comprehension or to otherwise enhance the training process. In 2003, Connecticut's Commission on Human Rights and Opportunities issued an opinion letter stating that online courses will comply if the course "provides an opportunity for students to ask questions and obtain answers in a reasonably prompt manner." Thus live, on-line webinars, for example, would satisfy the Commission's guidelines.

The content of the training must include the following:

A description of all federal and state statutory provisions prohibiting sexual harassment in the work place with which the employer is required to comply, including, but not limited to, the Connecticut discriminatory employment practices statute (section 46a-60 of the Connecticut General Statutes) and Title VII of the Civil Rights Act of 1964, as amended.⁴⁷
Definition of sexual harassment as explicitly set forth under Connecticut statutes.
A discussion of the types of conduct that may constitute sexual harassment under the law, including the fact that the harasser or the victim of harassment may be either a man or a woman and that harassment can occur involving persons of the same or opposite sex.
A description of the remedies available in sexual harassment cases, including, but not limited to, cease and desist orders; hiring, promotion or reinstatement; compensatory damages and back pay.
A statement advising employees that individuals who commit acts of sexual harassment may be subject to both civil and criminal penalties.
A discussion of strategies to prevent sexual harassment in the work place.

The regulations also encourage employers to discuss the following during the training:

Inform training participants that all complaints of sexual harassment must be taken seriously, and that once a complaint is made, supervisory employees should report it immediately to officials designated by the employer, and that the contents of the complaint are personal and confidential and are not to be disclosed except to those persons with a need to know.
Conduct experiential exercises such as role playing, co-ed group discussions and behavior modeling to facilitate understanding of what constitutes sexual harassment and how to prevent it.
Teach the importance of interpersonal skills such as listening and bringing participants to understand what a person who is sexually harassed may be experiencing.
Advise employees of the importance of preventive strategies to avoid the negative effects sexual harassment has upon both the victim and the overall productivity of the workplace due to interpersonal conflicts, poor performance, absenteeism, turnover and grievances.
Explain the benefits of learning about and eliminating sexual harassment, which include a more positive work environment with greater productivity and potentially lower exposure to liability, in that employers—and supervisors personally—have been held liable when it is shown that they knew or should have known of the harassment.
Explain the employer's policy against sexual harassment, including a description of the procedures available for reporting instances of sexual harassment and the types of disciplinary actions which can and will be taken against persons who have been found to have engaged in sexual harassment.
Discuss the perceptual and communication differences among all persons and, in this context, the concepts of "reasonable woman" and "reasonable man" developed in federal sexual harassment cases.

§ 15.2.1(c)

Mandatory Sexual Harassment Training In Maine

In workplaces with 15 or more employees, Maine employers must conduct a training program for all new employees within one year of commencement of employment that includes, at a minimum, the following information:

the illegality of sexual harassment;
the definition of sexual harassment under state and federal laws and federal regulations, including the Maine Human Rights Act and Title VII;
a description of sexual harassment, utilizing examples;
the internal complaint process available to the employee;
the legal recourse and complaint process available through the commission;
directions on how to contact the commission; and
and the protection against retaliation.

Employers must conduct additional training for supervisory and managerial employees within one year of commencement of employment. This training, includes, at a minimum, the specific responsibilities of supervisory and managerial employees and methods that these employees must take to ensure immediate and appropriate corrective action in addressing sexual harassment complaints.⁴⁸

Ethics & Compliance Training Under Amended Federal Sentencing Guidelines

The Sarbanes-Oxley Act of 2002, one of the most far-reaching pieces of corporate reform legislation in recent memory, is the most important law in this area. The Act contains provisions that received little or no public attention but which have potentially significant implications for employers.

Perhaps the most significant employment law change arising from the Act is the creation of a new federal cause of action entitled "Whistleblower Protection for Employees of Publicly Traded Companies." Under this section of the statute, an employee of a publicly traded company who provides information about actions that he or she reasonably believes to be a violation of federal securities law, the rules of the SEC, or "any provision of Federal law relating to fraud against shareholders" is given federal statutory protection. To warrant this protection, the employee must provide information, or cause the information to be provided, or assist in an investigation into conduct that the employee reasonably believes violates securities law or the law barring fraud against shareholders.

The disclosures protected include information made available to a federal regulatory or law enforcement agency, a member of Congress, a congressional committee or, more broadly, any person with supervisory authority over the company or any person at the employer with the power to "investigate, discover or terminate misconduct." The Act also protects an employee who assists in any proceeding actually filed or "about to be filed" relating to securities fraud or fraud against shareholders. The protected assistance includes filings, testimony, participation, and assistance in such proceedings. The employee who engages in this protected activity is entitled to be exempt from discharge, demotion, suspension, harassment, or any other type of discrimination.

The far-reaching scope of the Act is emphasized by the fact that it covers not only publicly traded companies, but also their officers, employees, contractors, subcontractors, and agents. This language would appear to leave officers and employees open to liability in their individual capacities. In addition, the Act would appear to create a claim against companies or organizations which do business with publicly traded companies.

In response to the Sarbanes-Oxley Act of 2002 , the U.S. Sentencing Commission amended their Sentencing Guidelines in 2004 to strengthen the requirements for corporate compliance. Under the amended guidelines, judges must consider whether a convicted corporation had established an "effective compliance program" prior to the violation taking place; in other words, whether the corporation had taken appropriate steps to prevent and detect violations of ethics laws. The 2004 amendment imposes the requirement that all employees, including high-level personnel, receive periodic training pertaining to their organization's ethics and compliance standards.

Comprehensive and periodic training on workplace ethics to prevent and detect criminal conduct has now become an imperative. If an organization undergoes scrutiny regarding its ethics and compliance practices under Sarbanes-Oxley or other federal statutes, evidence of an effective ethics and compliance program will significantly reduce liability exposure. Simply demonstrating that you have provided employees with an ethics policy or code of conduct is not legally sufficient; a formal training program is required under the amended guidelines.

In January 2005, the United States Supreme Court set aside part of the federal sentencing guidelines in a case concerning pronounced sentences for drug offenses.⁴⁹ While not addressing the guidelines' corporate application in its opinion, the Court's decision has effectively left the "mandatory" nature of the Sarbanes-Oxley sentencing guidelines unclear. However, the Court did find that judges should continue to consult the guidelines in determining sentences on an advisory basis at least until Congress can reconsider the mandatory nature of the sentencing scheme. Thus, employers looking to keep their managers out of jail should consider ethics training as mandatory.

Until more specific guidance is issued, organizations will be well served to address the following as they implement ethics and compliance standards:

Can your organization demonstrate a commitment to compliance with ethics law at the "highest levels" of management?
Is compliance training universally provided to all employees, and is periodic evaluation of the effectiveness of compliance programs taking place?
Among specific topics to address in the training, are the following areas covered?

confidential information;
insider trading;
conflicts of interest;
proper accounting practices;
Sarbanes-Oxley Act requirements – particularly, understanding antiretaliation and whistleblower protections of this and other laws;
proper financial reporting procedures and financial records maintenance;
use of organizational property;
handling gifts and favors; and
reporting ethical and compliance concerns under your organization's policies.

B. FARAGHER & ELLERTH: THE AFFIRMATIVE DEFENSE & ITS IMPACT ON THE LAW OF TRAINING

Faragher and Ellerth — these two sexual harassment cases grabbed headlines in every daily newspaper across the country. The U.S. Supreme Court concluded that if a supervisor made remarks about a subordinate's breasts, told her he could make her life "very easy or very hard," and said she might not get a promotion because she was not "loose enough," that was sexual harassment even though she was never fired or demoted and in fact got a promotion. The Court also found that when supervisory male lifeguards touched the bodies of female subordinates without invitation, told lewd stories in their presence, and pantomimed oral sex in front of them, that was sexual harassment also. Those who read the newspaper accounts of these decisions and concluded that these rather obvious holdings merely refined the legal definition of sexual harassment missed several important points.

The real focus in these two cases, Burlington Industries, Inc. v. Ellerth ,⁵⁰ and Faragher v. City of Boca Raton ,⁵¹ was not on what constituted sexual harassment, but on who was liable for it, under what circumstances, and why. The answers to these questions have had a definite effect on the emerging law of training during these last few years.

§ 15.2.1(a)

Failure to Adequately Train About Sexual Harassment

In Ellerth , the company argued that there could be no supervisory harassment absent a tangible job detriment. The Court rejected that argument. In Faragher , the City of Boca Raton argued that it could not be liable for what it did not know. The Court rejected that argument as well.

The Supreme Court held that an employer is strictly liable under Title VII for any gender-based harassment by a supervisor that results in a tangible job detriment. If the harassment does not result in a tangible job detriment, the employer is still strictly liable. Under those circumstances, however, the employer can raise an affirmative defense. It can show that: (1) it used "reasonable care" to prevent and correct any harassment, and (2) the employee "unreasonably" failed to complain.

Justice David Souter, writing for a seven-justice majority in one of the two cases, indicated that the root of the City of Boca Raton's liability was not only the intimidating authority its supervisors wielded, but also the fact that the City had failed in its duty to adequately train these supervisors:

Recognition of employer liability when discriminatory misuse of supervisory authority alters the terms and conditions of a victim's employment is underscored by the fact that the employer has a greater opportunity to guard against misconduct by supervisors than of common workers; employers have greater opportunity and incentive to screen them, train them, and monitor their performance.⁵²

The Supreme Court thus sent a clear message in these two linked decisions: The failure to adequately train supervisors regarding all appropriate aspects of sexual harassment creates Title VII liability and may deprive the employer of its best defense.

All Protected Categories Covered

Although these two suits focused exclusively on substantive issues related to sexual harassment, federal courts have applied these principles to harassment claims based on nearly all the protected categories.⁵³

The Supreme Court implicitly endorsed that expansion when it explicitly drew a parallel between race and sex harassment in Faragher, stating that:

Although racial and sexual harassment will often take different forms, and standards may not be entirely interchangeable, we think there is good sense in seeking generally to harmonize the standards of what amounts to actionable harassment.⁵⁴

Indeed, the EEOC followed this line of thinking when it declared that the Faragher and Ellerth standards apply equally to all forms of harassment forbidden by federal antidiscrimination laws.⁵⁵

The EEOC reported a dramatic rise since September 11th in harassment charges based on conduct targeted at Muslims or those with Arab, Afghani, Middle Eastern or South Asian national origins.⁵⁶ Thus, employers may have to rely on the affirmative defense more often in claims including a greater variety of categories. Thus, employers can expect to need to raise the affirmative defense in a wide variety of cases.

The EEOC's Mandate to Train

The requirement to train, implicit in these landmark Supreme Court cases, was further made explicit by the EEOC's 1999 guidelines on establishing an affirmative defense:

If feasible, the employer should provide training to all employees to ensure that they understand their rights and responsibilities [under the laws prohibiting harassment]. . . . An employer should ensure that its supervisors and managers understand their responsibilities under the organization's antiharassment policy and complaint procedures. Periodic training can help achieve that result. . . . An employer should set up a mechanism for a prompt, thorough, and impartial investigation into alleged harassment . . . . The employer should ensure that the individual who conducts the investigation would objectively gather and consider the relevant facts. Whoever conducts the investigation should be well trained in the skills that are required for interviewing witnesses and evaluating creditability.⁵⁷

The EEOC's position is clear: To have the best chance to avoid liability for workplace harassment, employers must train every employee and every manager on their responsibilities in preventing harassment at work.

§ 15.2.1(b)

Cases Discussing Harassment Training in the Wake of Supreme Court Decisions

Application of Faragher/Ellerth Affirmative Defense

In determining if an affirmative defense exists, courts have considered not only whether an employer has an antiharassment policy, but also whether the policy has been effectively communicated to supervisors and employees. The EEOC has taken the position that an employer has a duty to prevent harassment, which extends beyond merely implementing an antiharassment policy.⁵⁸ Following this line of thought, courts have found that proof of sexual harassment training can be essential to an employer's ability to assert the affirmative defense. Indeed, some courts have held that training is an essential element in proving that the employer "exercised reasonable care to prevent and correct harassing behavior" under the first prong of the defense.

Training Managers – A Necessary Part of the Affirmative Defense

Federal and state courts in certain jurisdictions have held that training managers on preventing workplace harassment is an essential element in the establishing Faragher/Ellerth's affirmative defense.⁵⁹ The line of cases from these courts hold that merely having a harassment policy is not enough to satisfy Faragher/Ellerth . In addition, employers must show the following:

training for the company's supervisors regarding harassment;
an express antiretaliation provision; and
multiple complaint channels for reporting the harassing conduct.⁶⁰

Soto v. John Morrell & Co., shows just how stringent courts have become in requiring the first prong (training) of the above stated test. In that case, the employer promulgated its harassment policy in a separate document in both English and Spanish. All employees received a copy of the policy at orientation and annually thereafter, and were required to sign an acknowledgement. This acknowledgement stated that the employee had received the policy and gave the company's specific contact information for its EEO officer. The personnel and training departments displayed large posters detailing the company's antiharassment policy. Finally, the employer's president sent a letter to all employees, including the plaintiff, reminding them that harassment was against company policy.

This proactive, consistent approach to preventing workplace harassment was impressive. Yet, it failed to include one essential element – manager training. Managers were required to be trained yearly but that requirement apparently when unfulfilled. The Director of Human Resources did speak with managers yearly on the subject, claiming this was "training." His testimony fell apart upon examination by the plaintiff's attorney:

Q: What guidelines requirements does corporate have for you in terms of what you must do in training, is there any written policy or guideline saying this is what you must do, this is how you must do it?

A (Director of H): Not that I'm aware of.

Q: . . . Has corporate ever provided you like a script of what is to be told to employees regarding sexual harassment?

A: No.

Q: Have they ever provided you any policies that say you must do this training with its employees regarding sexual harassment and then provide the training material?

A: No, other than the statements and placards and stuff that I have alluded to earlier.

Q: So they don't have a program that they say this is the program you must teach?

A: No.

Q: So there's no uniform method of communicating the sexual harassment policy to the employees of John Morrell, is that correct?

A: I believe that's correct.⁶¹

Successful Application of the Affirmative Defense

Compare how the employer faired in the Soto decision with those employers who combined proactive harassment prevention measures with training. Federal courts and the EEOC have determined that an employer which distributes an antiharassment policy and which trains its supervisors and employees on harassment prevention can establish the affirmative defense.⁶³ Indeed, employers who take regular and comprehensive measures to prevent harassment, as opposed to a one-time approach, will find themselves in a good position to have their motions for summary judgment granted. Such a positive result can occur even when the employer's actions were not always perfect.

In Wyatt v. Hunt Plywood , Ms. Wyatt alleged that a supervisor committed harassment by referring to her in "vulgar terms" and by continually asking her to have sex.⁶⁴ The court found that the pattern of harassment fell into three specific time periods. Throughout the three periods, the company took a proactive approach to preventing harassment. It promulgated to all employees a harassment policy that included multiple ways to report harassment. The company also held regular training sessions with its managers on preventing harassment. Finally, after Ms. Wyatt's complaint of harassment, the company concluded a thorough investigation within three days resulting in the harasser being terminated. The court was impressed, holding that the company's approach was "more than adequate" to entitle it to summary judgment regarding the second and third periods of harassment.⁶⁵ Regarding the initial period of harassment, Ms. Hyatt had complained to her supervisor, who did nothing in response. The court found that the company had taken reasonable steps to prevent harassment. Because the plaintiff did complain, the company's motion for summary judgment could not be granted.

Continual efforts to prevent harassment, including training, can also help establish the second prong of the Faragher/Ellerth defense – the plaintiff's failure to reasonably complain about harassment to the employer. In Frisk v. Postmaster General , the plaintiff's failed relationship with a supervisor lead to years of sexually harassing conduct.⁶⁶ Yet, the plaintiff never availed herself of the several complaint procedures contained in the Post Office's policy. Was the plaintiff's failure to complain reasonable? The EEOC answered "no" based largely on employer's proactive steps to encourage complaints. These efforts included five separate posters relating to harassment being posted at the plaintiff's place of work, three publications were mailed to the plaintiff and other employees on EEO matters, including harassment, and the plaintiff received annual training.⁶⁷

Continual efforts to prevent harassment also paid off for employers even when their remedial measures were not perfect. In Fisher v. Electronic Data Systems , the plaintiff alleged that she was subjected to sexual comments, touching, and implications that she would be fired if she refused her former supervisor's advances.⁶⁸ However, the plaintiff did not inform anyone about the conduct for over a year. In reviewing whether the employer established the affirmative defense, the court looked at two issues: (1) did the employer attempt to prevent the harassment and (2) once the harassment occurred did the employer take effective remedial action.

Regarding the first prong, the employer maintained an antiharassment policy and trained the plaintiff and her manager about the conduct. Even the plaintiff acknowledged that this was sufficient to show the employer's good faith efforts to prevent harassment.⁶⁹ The plaintiff did question the adequacy of the employer's investigation. However, the court deemed those flaws minor, especially in light of the employer's efforts to prevent harassment. Thus, the employer established the affirmative defense, and the plaintiff's complaint was dismissed.⁷⁰

Conducting training before the harassment claim occurs gives an employer the best chance of showing that it took "reasonable steps" to prevent harassment. Many courts note the fact that training occurring well after the alleged harassment as a reason to deny the affirmative defense.⁷¹ However, conducting training even in the post-complaint stage can help an employer avoid liability.⁷² In Ferencich v. Merritt, the Board of County Commissioners was not liable for the sexually harassing behavior of a courthouse supervisor, because the evidence showed that the employer did not have a policy of allowing sexual harassment, and it acted quickly to discipline the offender, the Court of Appeals for the Tenth Circuit ruled. There, the plaintiff alleged that almost immediately after she started work at the County her supervisor began making sexual comments and sending her sexually explicit e-mails. The plaintiff finally complained after the supervisor twice placed her hand on his clothed genitals. The County's personnel director and assistant chief deputy took swift, authoritative action. After an investigation, they permanently demoted the supervisor and required him to undergo sexual harassment training. Unfortunately, the supervisor committed another incident of potential harassment, and the county terminated his employment. The court held that the combination of the policy, grievance procedure, and swift remedial action, which included training, were sufficient to insulate the County from liability.⁷³

It is interesting that in many of the above cases the employers' actions, while admirable, were less than ideal. In Wyatt , the supervisor who fielded the initial complaint did nothing. Yet, this failure did not "poison the well" so that the company's regular training plus prompt reaction to the final complaint were enough to establish an affirmative defense to all but the first period of harassment.⁷⁴ In Walton , the company policy lacked a clear reporting chain, which was made up for by annual letters to employees and supervisory harassment training.⁷⁵ In Fisher, the employer's investigation, while quick, did not follow all of the most prudent procedures to ensure effectiveness.⁷⁶ The Board of Commissioners' quick response, including training, after harassment occurred was enough to establish a defense in Ferencich v. Merritt .⁷⁷ The message the courts are sending seems clear. While perfection is not required, employers' harassment efforts, including training, must be consistent and effective to establish an affirmative defense.⁷⁸

Employer's Failure to Adequately Train Managers Defeats Application of the Affirmative Defense

Equally important to consider are those cases in which employers failed to establish the affirmative defense in part due to a perceived lack of or insufficient training about harassment. Often, employers with antiharassment policies have been unsuccessful in raising the affirmative defense because their policies were not effectively communicated to supervisors or employees. This problem could have been corrected by high quality training.

Training that does not adequately explain to employees how to prevent and report harassment may be insufficient to establish an affirmative defense.⁷⁹ In Elmasry , Jennifer Elmasry alleged sexual harassment by her supervisor. Elmasry claimed that the supervisor made numerous inappropriate sexual comments, propositioned her on several occasions, inappropriately touched her and fired her when she did not reciprocate. The company's motion for summary judgment regarding the harassment claim was denied. The court reasoned that the plaintiff raised genuine issues of fact as to whether the employer really had taken reasonable care to prevent harassment. Although Elmasry undisputedly received the company's antiharassment policy and complaint procedure, she was not "effectively made aware of that policy, because no one specifically pointed it out or explained it to her." Further, the company provided just "one training seminar, a portion of which dealt with sexual harassment."⁸⁰

In Williams v. Spartan Communications, Inc. , the court reversed a grant of summary judgment to an employer, pointing out that although the employer had a policy, the accused harasser/supervisor had not been trained on sexual harassment or the policy, and there was other evidence of upper management harassment.⁸¹ Thus, even though the plaintiff knew of the policy and the employer forced the alleged perpetrator to resign after the allegations, this employer had to continue the costly journey toward trial, in part, because it had not trained its supervisors. Having a sexual harassment policy but failing to disseminate it or train managers and employees on the subject prevented another employer from winning its summary judgment motion in the harassment portion of a lawsuit.⁸²

Similarly in Gordon v. Southern Bells, Inc. , the court held that the employer failed to establish an affirmative defense because it did not provide harassment complaint forms, it did not distribute the policy to employees or managers, and it did not provide antiharassment training.⁸³ The existence of a policy on its own was not enough to establish the first prong of the affirmative defense. The court also held that the plaintiff had complained, so the employer could not meet the second prong of the defense.

Training Must Be Effective to Establish an Affirmative Defense

It should be recognized that while training is an important, possibly indispensable step, in avoiding liability for harassment, it is not a magic shield. In one case brought against Compaq, the company had an antiharassment policy that was posted in the workplace.⁸⁴ The plaintiff received training in sexual harassment prevention that included a discussion of ways that an employee could make a complaint. Yet, once she made an apparently valid complaint of sexual harassment against her supervisor, the computer maker did not monitor or limit the manager's authority. Thus, the court held that Compaq could not establish an affirmative defense to harassment liability and denied the company's motion for summary judgment.⁸⁵

Courts are scrutinizing the details of the training before releasing organizations from liability under the affirmative defense. As explained above in Soto, the company's failure to provide any detail about what was presented during training barred the application of the affirmative defense.⁸⁶ In Lapenta v. City of Philadelphia , the court held that "one half day training seminar on sexual harassment,. . . almost ten years prior to the alleged harassment. . . [is] insufficient as a preventative measure."⁸⁷ General discrimination training or training focused on protected category will not be a general panacea against liability. In Freeman v. Spencer Gifts , the company had conducted sexual harassment training, which the court found irrelevant in the attempt to establish an affirmative defense to a racial discrimination claim.⁸⁸

The lesson from these cases is that training must be consistent and of such good quality that it helps employees change their behavior to comply with the law.

§ 15.2.2

C. STATES PROVIDING AN EVEN HIGHER STANDARD FOR AFFIRMATIVE DEFENSE

State courts have been even more emphatic in stating that employers who fail to train their employees on preventing harassment evidence negligence in monitoring their workforces, and therefore, will be without a defense to liability.⁸⁹ In Gaines v. Bellino , the plaintiff, a Corrections Officer, alleged that her shift supervisor grabbed her face and kissed her against her will while the two were alone in the jail. Although Gaines reported this misconduct to one of her supervisors, the supervisor did not report this incident to his superiors because the county had not provided him with any anti-sexual harassment training. (In fact, several corrections officers testified that they had not received any training concerning the county's sexual harassment policy.) Gaines' allegations were ultimately brought to the attention of the county's Director of Personnel as a result of Gaines' deposition testimony in an unrelated case. Following an internal investigation of her claims, the county suspended the supervisor, who retired shortly thereafter.

Gaines filed suit in 1998 against supervisor and the County Correctional Facility alleging violations of the New Jersey Law Against Discrimination (NJLAD). The county moved for a summary dismissal of Gaines' claims without a trial, relying on its antiharassment policy as an affirmative defense to Gaines' claims. Both the trial and appellate courts agreed with the county's position, concluding that the county was shielded, as a matter of law, from vicarious liability for supervisor's misconduct because: (1) it had promulgated a workplace antiharassment policy, (2) Gaines had failed to report the harassment incidents to higher level management in accordance with the terms of the policy, even though she knew of the policy's existence, and (3) the county took disciplinary action against the supervisor as soon as it learned of the alleged harassment. The New Jersey Supreme Court reversed both lower court rulings and remanded the case for further proceedings.

Training – Evidence of an "Unequivocal Commitment" to Prevent Workplace Harassment

The U.S. Supreme Court in Faragher , held that in the absence of managerial and supervisory training, triable issues existed as to the effectiveness of the county's antiharassment policy and as to whether that policy could shield the county from vicarious liability for the supervisor's conduct.

In its seminal 1993 decision in Lehmann v. Toys ‘R Us , the New Jersey Supreme Court held that an employer may be held vicariously liable under NJ LAD for a supervisor's misconduct when the employer was negligent in preventing workplace sexual harassment by that individual.⁹⁰ The court in Lehmann had explained that the presence of an antiharassment policy would not automatically shield the employer from claims of hostile environment workplace sexual harassment unless that policy was an effective one.

The court in Gaines emphasized that while Lehmann did not establish "a bright-line rule . . . for the standard of negligence required in sexual harassment claims," numerous factors are relevant to this determination, including whether the employer provided "mandatory" antiharassment training for its supervisors and managers, and also made that training available to all employees in its organization.⁹¹ The court also rejected the county's argument that Gaines' failure to file a formal complaint pursuant to the antiharassment policy barred her claims. The court stated that an employee's inaction must be viewed in the context of whether the employer provided meaningful assistance to the employee who sought to complain about a supervisor's harassment. Concluding that an antiharassment policy "must be more than the mere words encapsulated in the policy," the court stated that such a policy must demonstrate an employer's "unequivocal commitment from the top" to preventing workplace sexual harassment.⁹² According to the court, the absence of "effective preventive mechanisms," such as training, will present strong evidence that an employer was negligent in monitoring and preventing workplace sexual harassment. Based upon the record facts, the court held that Gaines' complaint should not have been dismissed because factual issues existed concerning the effectiveness of the county's antiharassment policy.

Eliminating the Affirmative Defense and the Greater Need to Train

The affirmative defense available to claims of harassment under federal antidiscrimination laws but may not apply to the parallel state laws. In a major decision regarding sexual harassment by supervisors, the California Supreme Court finally decided whether California's Fair Employment and Housing Act (FEHA) includes a special or "affirmative" defense to sexual harassment claims recognized by the United States Supreme Court in federal employment harassment claims. Ruling in Department of Health Services v. Superior Court , the California Supreme Court held that FEHA does not allow the federal Faragher/Ellerth defense.⁹³ The California Supreme Court emphasized that FEHA's provisions differ from Title VII. The Faragher/Ellerth defense was based on the law of agency. The FEHA imposes strict liability for all harassment by supervisors, and thus does not allow defenses based on agency.⁹⁴

The Faragher/Ellerth defense spurred many employers to conduct harassment prevention training. Does the rejection of the defense by the California Supreme Court mean that such training is useless in California? No it does not. In fact, employers should draw the opposite conclusion – that harassment training is more important than ever.

Prudent employers will likely re-focus on live training for managers to best ensure the greatest impact. Regular follow-up training for managers will also likely become the norm under this regime of heightened scrutiny.

§ 15.2.3

D. THE "KOLSTAD DEFENSE" TO PUNITIVE DAMAGES

Training has also become an indispensable tool in the struggle to prevent the crippling costs of punitive damages. In 1999, the U.S. Supreme Court made EEO training more important than ever by making it a part of a defense against punitive damages in discrimination cases.⁹⁵ The Supreme Court's decision in Kolstad v. American Dental Association under Title VII of the Civil Rights Act of 1964 seems to have pleased both employees and employers. An employee is no longer required to show that an employer's discriminatory conduct was egregious or outrageous for an award of punitive damages. However, an employer will not be held liable for punitive damages if a manager's conduct is contrary to the employer's good-faith efforts to comply with Title VII.

Carole Kolstad was one of two employees competing for a promotion in the Washington, D.C. office of the American Dental Association. When the other employee, a male, was selected, she sued the Association in federal court, alleging that she had been passed over because of her gender in violation of Title VII. A jury ruled in her favor, awarding her $52,718 in back pay. Kolstad appealed, however, contending that the trial court should have instructed the jury that it could award her punitive damages as well. The appeals court agreed with Kolstad. The Supreme Court decided to hear the case to resolve a conflict among the federal appellate courts about the circumstances under which punitive damages, i.e ., extra money damages to punish the employer, may be awarded in Title VII cases.

The Supreme Court issued its decision in two equally important parts. The first part was good news for employees; the second part was a pleasant surprise for employers.

In the first part, the Court held that an individual who is successful in an employment discrimination suit might also collect punitive damages if he or she shows the following:

The discrimination was intentional . This means simply that the employer intended to discriminate based on a protected category, not that it knew the discrimination was unlawful. (Remember: not all discrimination is unlawful; only discrimination on an improper basis, such as race, gender, etc., is forbidden. Disparate impact cases in which an employer does not intend to discriminate but where its action has a discriminatory effect, do not qualify for punitive damages.)
The employer acted with malice or reckless indifference to the employee's rights . According to the Court, this does not mean that an employer's conduct must be egregious or outrageous before punitive damages may be awarded. Rather, the employee must only show that an employer discriminated "in the face of a perceived risk that [the employer's] actions [would] violate federal law." In other words, the employer knew that its actions might violate the law. The Court noted that there would be circumstances where intentional discrimination does not give rise to punitive damages, as where the employer is unaware of the relevant federal prohibition or discriminates with a distinct belief that its discrimination is lawful, where the underlying theory of discrimination is novel or otherwise poorly recognized, or where the employer reasonably believes that its discrimination satisfies the bona fide occupational qualification or other statutory exception to liability.

In part two of its decision, on a much more closely divided 5-4 decision, the Court ruled that even if an individual satisfies the criteria described above, he or she cannot collect punitive damages from the employer (as an entity) if the manager's actions "are contrary to the employer's good faith efforts to comply with Title VII." This means that even if the plaintiff shows that an employee, typically a manager or supervisor, engaged in unlawful discrimination with the knowledge that those actions might violate the laws, the plaintiff still may not receive punitive damages.

How does an employer show that it has made "good faith efforts" to comply with the discrimination law? Although the Court did not detail every action that might qualify under this standard, a "good faith" effort clearly includes: (1) adoption and implementation of antidiscrimination policies, and (2) training personnel about what is and is not permitted under applicable laws.⁹⁶ The Court's decision is to encourage "employers to adopt antidiscrimination policies and to educate their personnel."⁹⁷

In a recent case, the U.S. Court of Appeals for the Fourth Circuit so steadfastly adhered to the principles set forth in Kolstad , that it actually overturned a jury's award of punitive damages because of the employer's good faith efforts (including live, interactive training) to proactively prevent workplace discrimination.⁹⁸

In sum, an employer need not be concerned quite as much about large punitive damages awards if the employer has adopted and implemented adequate antidiscrimination policies. But an employer cannot just sit back once a policy is in place or turn a blind eye to employee actions that might violate the law. The cases make it more important than ever for employers to train all employees, particularly supervisors and managers, about the do's and don'ts of federal discrimination law and to be ever vigilant in monitoring the workplace to insure that policies are regularly and consistently applied. To do otherwise is an open invitation to liability.

§ 15.2.3(a)

Liability Limited Where Employer Provides Training

Courts have increasingly used the Kolstad decision to ensure that employers who train on harassment and discrimination prevention do not receive punitive damages.⁹⁹ In this case, the court refused to let the jury even consider awarding punitive damages against the defendant companies because they had shown good faith efforts to prevent harassment. Although two waitresses complained of vulgar comments and inappropriate touching by managers, the court found that the companies had "a well-publicized policy forbidding sexual harassment, gave training on sexual harassment to new employees, established a grievance procedure for sexual harassment complaints, and initiated an investigation of the plaintiff's complaints" which met the Kolstad standards.¹⁰⁰ In this case, although the companies were found liable for compensatory damages for harassment and emotional distress, they completely avoided punitive damages of much higher amounts.

Oddly, in this case, the same steps that earned the employer the Kolstad defense, failed to convince the jury that the company should have an affirmative defense under Faragher and Ellerth . The appellate court allowed this logical inconsistency by stating that it was reasonable for a jury to choose not to believe the company and therefore find the company liable for harassment. It was also reasonable for the judge not to give out a punitive damages jury instruction based on the company's efforts which satisfied the Kolstad good-faith test. Although the judge tried to "overrule" the jury and grant judgment as a matter of law on the harassment claims, the appellate court reversed that decision because a judge's opinion is not allowed to supplant the jury's.

Another company escaped punitive damages in an economic harassment case where a male employee claimed that he was terminated because he had rejected his female manager's sexual advances.¹⁰¹ The court held that the employer's policy prohibiting discrimination and harassment, and its training of managers on that policy, indicated its good faith. Thus, the court granted the employer's summary judgment motion rejecting the plaintiff's request for punitive damages.

Courts have also applied the Kolstad defense where employers have held management training on harassment prevention and the employer was shown not to have had knowledge of the harassing situation.¹⁰² In Cooke v. Stefani Management Services, Inc. , a male bartender alleged sexual harassment by his male manager. Although he complained to both the manager and assistant manager at the branch restaurant, he never reported the incidents to the corporate office. The appellate court held that the corporation had met the Kolstad good faith defense requirements by instituting antiharassment policies, holding management harassment prevention training which the alleged harasser had attended, and posting an antiharassment poster at the branch restaurant site. The court therefore reversed the award of punitive damages against the restaurant stating that the employer had done everything it could have done given that it never had knowledge of the alleged harassment.

§ 15.2.3(b)

Liability Enhanced Where Employer Fails to Train

One of the most remarkable legal developments have been decisions in which an employer's inaction regarding training showed willful disregard for the law and was the basis for the award of punitive damages in a harassment or discrimination law suit.¹⁰³ In Phillips , the job applicant claimed race and age discrimination during the application process. Although the employer never met the applicant, the plaintiff was able to show that the hiring managers had knowledge of his age and race through his resume. The managers admitted that they wanted to hire "bright, young, and aggressive" salespeople and actually hired seven young, white salespeople in place of the applicant.

Although the employer had an EEO statement on its application, the court found that the employer had discriminated against the plaintiff and that the company had failed to educate its managers about their legal duty not to discriminate. "Leaving managers with hiring authority in ignorance of the basic features of the discrimination laws is an ‘extraordinary mistake' for a company to make, and a jury can find that such an extraordinary mistake amounts to reckless indifference" of antidiscrimination laws.¹⁰⁴ The employer here had to pay liquidated damages as a result of not educating its managers appropriately regarding their hiring duties.

Although Phillips applies only to the award of liquidated damages under the ADEA, courts routinely harmonize the standards applied under the various major federal EEO laws. Thus, failing to train managers could be used to prove a plaintiff is entitled to punitive damages. At the very least, proving that training has occurred will likely become a required element of showing that an employer implemented "good faith" efforts to prevent discrimination from occurring.

Even without Phillips, failing to train employees can result in the loss of the Kolstad defense.¹⁰⁵ Karen Romano sued U-Haul for sex discrimination after she was fired from her job as a customer service representative. Romano's manager told her that upper management did not want women working in the main office and that "the only problem you have is you sit when you pee." A jury verdict in favor of the plaintiff ($625,000 punitive damages; $15,000 compensatory damages) was affirmed on appeal. The court of appeals reviewed the Kolstad standard regarding whether to award punitive damages. Noting that a written antidiscrimination policy, without more, is insufficient to insulate an employer from punitive damages liability, the court held that a "defendant must also show that efforts have been made to implement its antidiscrimination policy through education of its employees and active enforcement of its mandate."¹⁰⁶

Courts continue to enforce the message that employers who fail to train managers on how to prevent and properly respond to harassment complaints will be liable for punitive damages without recourse to Kolstad . In Swinton v. Potomac Corporation, a section 1981 racial discrimination case, the court affirmed a $1,000,000 punitive damages award.¹⁰⁷ The employer had argued that it met the good faith Kolstad requirement because it had written policies forbidding harassment and had instituted antiharassment procedures. The court rejected this argument. The court stated that the company "could have impressed upon its supervisors . . . whom it tasked with accepting complaints of harassment . . . that repeatedly subjecting a black employee to "nigger" jokes is wholly unacceptable, and at odds with basic antidiscrimination principles. But it chose not to, and [the employer] cannot now be heard to protest . . . ."¹⁰⁸ The court clearly indicated that training and educational measures which further managerial awareness of discrimination and harassment are important components necessary before an employer can invoke the good-faith defense.

A similar decision was reached in Marrero v. Goya of Puerto Rico, Inc .¹⁰⁹ There, the court affirmed the punitive damages award against the company noting that defendant Goya's managers had failed to respond to complaints and "the jury was justified in finding that Goya did not have a sexual harassment policy in effect during the relevant events…[and even if it had] Goya did not present any evidence that it had implemented it, either through educating its employees or enforcing its mandate."¹¹⁰

In a particularly reprehensible case, a fuel-hauling company's East Indian employees filed a racial discrimination and breach of contract lawsuit against ARCO because its managers consistently called the Indian employees and owners derogatory names such as "rag-heads," "towel-heads" and the like.¹¹¹ The managers further demeaned the Indian employees by requesting that fuel be cleaned up with their turbans, making them wait longer to fill their trucks and forcing them to use slower pumps. The court found that ARCO did not present evidence "of the implementation of an effective antidiscrimination policy" and ARCO failed to respond to any complaints made internally and thus failed to assert or establish a Kolstad defense. The jury awarded only $1 in compensatory damages on the section 1981 race discrimination claim, but gave the fuel haulers $5 million in punitive damages. The court affirmed this award despite ARCO's protests of gross excessiveness.

The need to conduct effective harassment prevention training may now be more critical than ever in California, due to the recent decision by the Supreme Court in Department of Health Services v. Superior Court .¹¹² The court held claims for sexual harassment filed under California's Fair Employment and Housing Act (FEHA) will not be subject to the federal Faragher/Ellerth defense. The court emphasized that the FEHA's provisions differ from Title VII in that the FEHA imposes strict liability for all harassment by supervisors, and thus does not allow defenses based on agency. The Faragher/Ellerth defense is based on the law of agency.

While limiting the application of the Faragher/Ellerth defense, this decision affords California employers a significant new defense to claims of harassment by supervisors under the FEHA: the doctrine of avoidable consequences. This defense allows an employer to plead and prove that it took appropriate steps to prevent and address harassment, but that the employee unreasonably failed to take advantage of those protections. It enables employers to limit damages, so that they will not be liable for damages an employee could have avoided by utilizing the employer's complaint procedures.

In addition to having adequate written policies and procedures, training should be conducted to establish that the company's policies and procedures have been clearly communicated to all employees. Thus, in the same manner that training helps establish an employer's "good faith" defense to punitive damages under Title VII, it will also remain a critical part of the avoidable consequences defense in cases of sexual harassment filed under California's FEHA.

§ 15.2.3(c)

Training Which Is Not Enough to Avoid Punitive Damages

Even in situations where an employer has trained its employees and can prove it, punitive damages may apply if the employer did not train the managers actually responsible for the inappropriate conduct.¹¹³ In Godinet, the employer had to pay over $470,000 in damages and attorneys' fees, including $150,000 in punitive damages, even though it had an antidiscrimination policy and had trained some of its supervisors. In this case, a Samoan man was not promoted, and he claimed it was because the company had promoted African Americans instead. The plaintiff failed to receive two different positions with the company and ultimately filed a race discrimination lawsuit. Three employees testified that they had been directed by management to hire African American employees and both the positions the plaintiff wanted were given to African Americans.

Ultimately, although the employer had conducted training, it could not show that the four managers involved in the lawsuit had been trained in how to prevent discrimination. It had also failed to investigate the plaintiff's exit interview form where he checked "no" to a question regarding the company's provision of equal opportunity for all employees. The employer additionally failed to follow up on or investigate a phone call from plaintiff threatening to file a discrimination lawsuit.¹¹⁴ For all of these reasons, the employer was found liable for $150,000 in punitive damages and the court stated that "in addition to adopting antidiscrimination policies, an employer ‘must make a good faith effort to educate its employees about these policies.'"¹¹⁵

Training every other year is also not enough to prevent liability if the training did not occur during the years that the alleged harassment occurred.¹¹⁶ In Greene v. Coach, Inc. , the employer, Coach, submitted attendee lists of seven antiharassment and antidiscrimination training workshops it conducted from 1996-2000. However, for the two years of the plaintiff's employment, 1997-98, no attendee lists were submitted. In addition, although Coach apparently had a policy, there was no evidence submitted that indicated the extent to which retail managers were informed of the policy. As a result, Coach's motion to dismiss the plaintiff's punitive damages claim was denied. In part, by not training on an annual basis, Coach lost the ability to claim a good faith defense at the summary judgment stage, and a jury will likely be allowed to decide whether the company is liable for punitive damages.

Ensuring that the training is legally sound and covers the organizations own policies is also important to avoiding punitive damages.¹¹⁷ In Cadena , the company had conducted antiharassment training. Yet, because of legally unsound advice given by the trainer (e.g., the trainer's opinion that exposing genitalia to female employees would not be harassment if an apology ensued), the court held that the company had not taken "good faith" efforts to avoid harassment.¹¹⁸

Additionally, any delay in the implementation of training may impact the availability of Kolstad' s defense to a punitive damages claim. In Johnson v. Spencer Press of Maine, Inc ., the employer had launched a harassment prevention training program in early 2000, but the implementation of the program did not allow the employer to overcome a claim for harassment subsequently filed by an employee who had worked there since 1991. The accused supervisor alleged to have only realized that his behavior (making religious jokes, viewing Playboy magazines in the workplace and saving nude pictures on his computer) was inappropriate when he attended the training in April 2000. Due in part to the timing of the training, the court concluded that a triable issue of fact remained as to whether the employer had undertaken good faith efforts to comply with Title VII.¹¹⁹

In the same vein, employers which give "check-the-box" training will not always escape punitive damages awards either. In Madison v. IBP, Inc. , the employer had an antiharassment policy and an affirmative action plan.¹²⁰ Yet, it had squeezed "Legal Aspects of Supervision" into a two hour program which apparently included antiharassment training. The court held that these practices were not enough to avoid having the jury deliberate on punitive damages, given the evidence that the corporate policies were not carried out at the plant. Ultimately, managers were found to have ignored complaints of racial and sexual harassment and punitive damages were awarded.

§ 15.2.3(d)

Lessons on Avoiding Punitive Damages

As most employers already know, punitive damages can far exceed compensatory damage awards, sometimes raising much more serious financial issues for companies than the possibility of having to pay only compensatory damages. Punitive damage awards under Title VII are capped between $50,000 and $300,000, depending on the size of the employer. In light of the high stakes, an employer cannot afford to appear ignorant or unconcerned about its responsibilities to avoid discrimination complaints and to remedy the complaints it receives. Prevention through training can go a long way not only to limit an employer's liability under Title VII, but also to prevent discrimination claims from arising in the first place. Additional steps an employer can take include: instituting a policy forbidding harassment or discrimination, ensuring the policy is well-publicized, training new and existing employees on harassment/discrimination prevention, establishing a grievance procedure for harassment/discrimination complaints, and investigating internal complaints promptly.

The high cost of litigation is often enough to encourage employers to train supervisors and employees about how to avoid acts of discrimination and harassment. However, the possibility of more frequent punitive damages liability in Title VII cases gives employers an additional incentive to timely and regularly train supervisors and employees on how to avoid discriminatory and harassing conduct. Employers cannot afford to shirk their antidiscrimination obligations under Title VII. Nor can they ignore the advantages of providing antidiscrimination training.

§ 15.2.4

E. Unlawful Workplace Harassment Training: State-by-State Survey

§ 15.2.4(a)

California, Connecticut, and Maine are the three states placing the most direct harassment prevention training requirements on private employers. The following summarizes the laws of other states regarding such training.

§ 15.2.4(a)(1)

California

In addition to the requirements discussed above, the California Fair Employment and Housing Act requires employers to distribute an "information sheet" or provide "equivalent information" to all employees regarding sexual harassment. The information sheet is available from the Department of Fair Employment and Housing.¹²¹

The California Penal Code also requires that all new law enforcement officers attend a "basic training" course that includes training on sexual harassment in the workplace. Current officers must also be trained on sexual harassment.¹²² In 1998, the California Legislature authorized the state's Judicial Council to "provide by rule of court for racial, ethnic and gender bias, and sexual harassment training for judges, commissioners and referees."¹²³ The Judicial Council responded almost instantly, enacting a rule mandating "job-related training and continuing education programs for all [court] personnel concerning . . . sexual harassment awareness . . . [and] discrimination and bias."¹²⁴ The new rule took effect January 1, 1999.

§ 15.2.4(a)(2)

Colorado

The Colorado Sex Discrimination Rules, as adopted by the Colorado Civil Rights Commission, "encourage" employers to "sensitize" employees regarding issues relating to sexual harassment.¹²⁵

§ 15.2.4(a)(3)

Connecticut

See section 15.2.1(b) above.

§ 15.2.4(a)(4)

Florida

The Public Personnel Rules of Florida's Administrative Code require all supervisors within executive branch agencies to undergo training on the principles of equal opportunity and affirmative action.¹²⁶

§ 15.2.4(a)(5)

Illinois

The Illinois Human Rights Act provides that every public employer shall maintain and carry out a sexual harassment program, including sexual harassment training, as a component of all new employee-training programs.¹²⁷ Illinois law also requires that public contractors and eligible bidders for public contracts have a written sexual harassment policy that includes information on the Illinois Department of Labor's complaint process.

§ 15.2.4(a)(6)

Maine

Maine's Sexual Harassment Training and Education in the Workplace Law requires all private and public employers to conduct a sexual harassment education and training program for all new employees in workplaces with 15 or more employees within one year of commencement of employment.¹²⁸

§ 15.2.4(a)(7)

Massachusetts

Massachusetts' Fair Employment Practice Act "encourages" employers to conduct an education and training program for new employees within one year of commencement of employment, and to provide additional training for supervisors.¹²⁹ In addition, "Labor organizations and appropriate state agencies are encouraged to cooperate in making such training available."

§ 15.2.4(a)(8)

Michigan

Michigan's Disability Bias Law requires the department of civil rights to offer training programs to employers, labor organization and employment agencies to assist in understanding the requirements of the Act.¹³⁰

§ 15.2.4(a)(9)

Oklahoma

Oklahoma's "Fair Employment Practices Act", through its Rules of Personnel Management and Administration, requires that all state personnel who investigate complaints of discrimination be trained in the areas of equal employment opportunity, discrimination and burdens of proof.¹³¹

§ 15.2.4(a)(10)

Pennsylvania

Pennsylvania's Human Relations Act requires that all "Commonwealth employees will be educated in sexual harassment."¹³²

§ 15.2.4(a)(11)

Rhode Island

Rhode Island's Sexual Harassment, Education and Training Law "encourages" employers to conduct an education and training program for new employees within one year of commencement of employment, and to provide additional training for supervisors.¹³³ "Employers and appropriate state agencies are encouraged to cooperate in making such training available."

§ 15.2.4(a)(12)

Tennessee

The Tennessee State Employees' Sexual Harassment Law obligates the state department of personnel to conduct training workshops for all public employees.¹³⁴

§ 15.2.4(a)(13)

Texas

Texas' Employment Discrimination Law mandates that each state agency provide its employees with employment discrimination training within 30 days after being hired and then on a supplemental basis every two years.¹³⁵

§ 15.2.4(a)(14)

Utah

The Utah Department of Human Resource Management Rules obligates all public employers to conduct sexual harassment prevention training consistent with standards established by the Department.¹³⁶

§ 15.2.4(a)(15)

Vermont

The Vermont Fair Employment Practices Act "encourages" employers to conduct an education and training program for new employees within one year of commencement of employment, and to provide additional training for supervisors.¹³⁷

§ 15.2.4(e)

Judicially Imposed Settlements & Consent Decrees Requiring Training

Not all workplace training is mandated by legislatures or by executive branch regulators. Training may also be required by the judicial branch as part of the settlement of a lawsuit, or, if the state or federal government has brought suit against the employer, as part of a negotiated "consent decree." Indeed, requiring training as a part of litigation settlement is now standard operating procedure for the EEOC. For example, Morgan Stanley settled a long standing sexual discrimination class action on the eve of trial for $54 million.¹³⁸ In that case, the settlement contained detailed training requirements, including ongoing executive training, discrimination training, and diversity training.¹³⁹ Significantly, the decree required that part of the training be done using live training (either in-person or live on-line) instead of self-study training.¹⁴⁰

As part of the resolution of a heavily publicized race discrimination suit filed by some of its employees, Texaco paid $115 million in damages and $26.1 million in wage increases to its minority employees. As a part of the settlement, Texaco announced a "comprehensive plan" designed to eradicate vestiges of discrimination. The plan included a redesign of the corporation's diversity training program and the expansion of that program to include all employees. The new program, launched in mid-1997, included components on diversity awareness training, sensitivity training, and training to insure that employees develop an awareness of different work styles, according to company sources.¹⁴¹

OSHA also continued a long-standing practice of requiring safety training to settle disputes over employer fines. For example, Phillips Petroleum Co. agreed to pay $2,169,500 in penalties for safety and health violations discovered after an explosion in March 2000 that killed one worker and injured 69 others at a chemical plant. As part of the settlement agreement, Phillips Chemical Co. will conduct comprehensive reviews of the plant's training program and standard operating procedures.¹⁴²

In an ergonomic-related settlement, the U.S. Labor Department settled a long-standing claim with Beverly Enterprises, the nation's largest nursing home chain. The agreement settled citations issued by OSHA to five Beverly nursing homes, and required the employer to agree to train workers on the proper use of lifting devices at 270 facilities operated across the United States.¹⁴³

§ 15.2.4(f)

Other Legal Implications of Inadequate Training

The laws described above impose on an employer both a duty to train and a minimum standard of care. However, even when an employer provides all training that is required by law, a court may find that the employer should also have complied with higher training standards, if such higher standards are common in the employer's industry. Thus, if other companies in the industry provide training that exceeds the minimum required by law, the higher level will become the new threshold for training.

Training may also be deemed inadequate when a trainee fails to learn the material. For example, under Fed-OSHA, in order to comply fully with HazCom right-to-know regulations, employers must ensure not only that their employees receive the training but that they also understand the information and training that they were given.

An employer who fails to train as required by law or by industry standards may be subject to fines and penalties by the government agency involved, including forfeiture of government funding or exclusion from government contracts. Some statutes also specify criminal sanctions, including incarceration, against an employer or individual trainer when the failure to conduct training results in death or serious injury to an employee or someone else.¹⁴⁴ Of course, employees or third parties injured because of a lack of training (or inadequate training) may file civil lawsuits seeking compensatory and punitive damages from the employer, particularly if they can demonstrate that the employer failed to meet the industry standard for training.

In these civil lawsuits, the plaintiff may try to prove that although the company met the minimum requirements of the statute, the particular circumstances of the workplace required additional training. For example, although Fed-OSHA does not require that training be conducted in more than one language, employers with diverse workplaces should ensure that the training is understood, i.e. , that it is conducted in the native language of the employees, not just in English. Similarly, although there is no requirement for employers to pair employees with supervisors who speak the same language, since training often occurs on the job, the employer's failure to pair the employee with a supervisor who speaks the worker's language may result in liability if the employee is injured or disciplined for failure to perform.

§ 15.2.4(b)

Occupational Safety & Health Training Requirements

Education and training are essential means for communicating practical understanding of the requirements of effective safety and health protection to all personnel. Without such understanding, managers, supervisors, and other employees will not perform their responsibilities for safety and health protection effectively. The U.S. Department of Labor's Bureau of Labor Statistics (BLS) reports that safety instruction is the field that currently provides the highest single percentage of training activity per employee in the nation.

Employers are providing more on-the-job safety training than any other kind. According to data developed by the ASTD, 84% of employers with 50 or more employees responding to its 1997 Human Performance Practices Survey indicated they provided OSHA training the previous year.

On January 26, 1989, the Federal Occupational Safety and Health Administration (Fed-OSHA) issued safety and health program management guidelines (Guidelines) for use by employers to prevent occupational injuries and illnesses. These Guidelines consisted of program elements distilled by Fed-OSHA from safety and health management practices of employers who, in Fed-OSHA's view, successfully protected the safety and health of their employees.¹⁴⁵

The Fed-OSHA Guidelines listed four elements for effective occupational safety and health programs: (1) management commitment and employee involvement; (2) work site hazard evaluations; (3) hazard prevention and control measures; and (4) safety and health training. Employers must implement training programs to ensure that all employees understand the hazards to which they may be exposed and how to prevent harm to themselves and others from exposure to these hazards so that employees accept and follow established safety and health protections.

Supervisors must be trained to carry out their safety and health responsibilities effectively and to ensure that they understand those responsibilities and the reasons for them. This includes training supervisors to analyze the work under their supervision to identify potential hazards, maintain physical protections in their work areas, and reinforce employee compliance through performance feedback and enforcement of safe work practices.

Training is a required component of compliance with virtually all Fed-OSHA standards. However, there are two key compliance areas common to all employment situations that present excellent starting points for implementing safety and health training programs. These are hazard communication and accident prevention plans (injury and illness prevention plans). Providing the required initial and refresher training in these areas can also meet minimum training requirements for a wide range of substance-specific and industry-specific OSHA standards. See "OSHA Training Requirements Highlights" at the end of this chapter for a detailed, but not all-inclusive, list of other safety and health topics that require employee training.

The minimum elements that must be covered in hazard communication and accident prevention training are as follows.

Employer Personnel Responsible for Safety & Health Program Administration

Initial and refresher training must clearly designate specific individuals with overall responsibility for implementing and updating hazard communication and accident prevention programs. Employees must be informed as to how to contact these personnel regarding safety and health questions or concerns, including a provision for anonymous reporting of such concerns.

Task-Specific Hazards & Control Measures

Employees must be informed of all chemical, physical and biological hazards involved in their assigned work tasks, as well as additional hazards that may affect their work tasks. This training must include instruction in how employees can recognize such hazards and potential signs and symptoms of overexposure, and what measures the employer has implemented to protect employees from the hazards and to prevent overexposures. Hazard recognition training must include the employer's container labeling systems, warning signs and how employees can obtain and read Material Safety Data Sheets from chemical suppliers. Where protective measures include special tools or engineering controls, the employees must be taught how to use and maintain those devices. Where personal protective clothing and/or respirators are required, employees must similarly receive training in the proper selection, use, and maintenance of those devices. If employees may periodically be assigned to nonroutine tasks, the training program must include measures that the employer will use to identify and control potential hazards of such non-routine work assignments and how those measures will be communicated to affected employees.

Most recently, OSHA has been formalizing a directive that will address workplace violence in the nursing home industry through training and outreach. The directive, CPL 2-2.69, requires all nursing home employees with occupational exposure to the hazards associated with blood and other infectious materials, to receive training at the time of initial employment and at least annually thereafter.

Employee Communication

Training for compliance with hazard communication and accident prevention plans must include a description of the means used to communicate with employees regarding safety and health matters. Communication methods may include workplace postings, written memos or newsletters, training handouts, safety meetings, and/or safety committees, as well as daily interactions between employees and their supervisors.

Minimum Safe Work Practices & Enforcement

Employers should develop and implement written, minimum safe work practices and standard operating procedures for each task assigned to employees. Compliance with these safe work practices and procedures should be a condition of employment. Noncompliance should result in disciplinary action in accordance with the employer's personnel policies and practices. Both the minimum work practices and procedures and the employer's enforcement policy must be communicated to employees in training.

Refreshers & Training Updates

Employees require periodic refresher training in hazard communication and accident prevention. The usual recommended frequency is at least annually. Employees observed violating safe work practices or procedures or behaving in an unsafe manner sh

CHAPTER 15 — TRAINING REALLY IS THE LAW: THE RISE OF MANDATORY TRAINING

CHAPTER 15 —
TRAINING REALLY IS THE LAW:
THE RISE OF MANDATORY TRAINING