A recent judgment awarded $250,000 in compensatory damages (including emotional distress) resulting from an employer’s inaction against a customer who for more than a year engaged in a pattern of harassment including inappropriately touching the employee and stalking.

In EEOC v. Costco, the EEOC proved that Costco failed to take steps to protect an employee from a customer who engaged in a pattern of harassing behavior.  The EEOC noted that as evidence of Costco’s inaction, it took them more than a year to even ban the customer despite the employees’ repeated protestations.  Because of Costco’s inaction, the employee was left with no choice but to go to the police and obtain an order of protection against the customer on her own.

Based on the company’s inaction, the EEOC argued Costco created a hostile work environment in violation of Title VII of the Civil Rights Act of 1964.   As the EEOC Lead Trial Attorney noted: “An employer should not wait until an employee is so fearful that she resorts to seeking a restraining order before intervening against a customer.  Employers should work diligently to ensure that all of its employees have a safe, harassment-free workplace.”

This case is a reminder that under Title VII employers needs to have plans in place to handle complaints by employees against customers, vendors, contractors or even friends of employees.  If an employee complains of harassment from a third-party, the manager or supervisor must treat the complaint as they would any other harassment complaint on the worksite.  This includes promptly investigating the issue and correcting the problem if the complaint can be sustained.  Training for supervisors to address and respond to these matters is also essential to ensure the employer does not run afoul of Title VII or similar state anti-discrimination laws.

Our team of attorneys has decades of experience in drafting harassment policies and training management on responding to complaints.  Providing these services is the first step in avoiding costly litigation and ensuring compliance with the various state and federal statutes.