Sexual Harassment Training Requirements by State

As the #MeToo movement has grown over the past two years, and claims against powerful individuals continue to surface in the media and on social media, employers and companies need to adjust their response polices as one thing is clear: sexual claims are very real, very expensive, and very destructive.

The following cases are real-world examples of how sexual harassment claims can cost employers in terms of time, money, and employee morale, and can cause pain and distress to employees.

  • A recent claim against the popular P.F. Chang’s China Bistro chain cost the company $1 million in response to two employees claims that they were repeatedly sexually harassed and were subjected to a hostile work environment.
  • Two female employees at a California winery were subject to repeated sexual harassment by the winery’s general manager and then subsequently retaliated against by the company. A Los Angeles jury awarded $11 million dollars to the two women. Each woman received $1 million for past emotional distress; $1.5 million for future emotional distress and $3 million in punitive damages. In addition to the $11 million dollars to the women, their attorneys will also receive their attorney’s fees.
  • Ford announced it would pay up to $10.1 million to settle a racial- and sexual-harassment investigation at two Chicago plants. 
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California Passes Law Requiring Boards of Publicly-Held Corporations to Include Women by 2019 (SB 826)

woman on boardOn September 30, 2018, California Governor Jerry Brown signed into law a radical initiative to add women to corporate boards of directors for publicly-held corporations headquartered in California.   According to Brown in a letter to the California State Senate, “Given all the special privileges that corporations have enjoyed for so long, it’s high time corporate boards include the people who constitute more than half the ‘persons’ in America.”  The California Senate approved Senate Bill 826 by a vote of 23 to 9 after the State Assembly narrowly passed the proposal with the bare minimum 41 votes a day earlier.  The Bill was then approved by the Governor and filed with the California Secretary of State.

Brown lawIn an effort to “close the gender gap” in business, the new law requires publicly traded corporations whose principal executive offices are headquartered in California to include at least one woman on their boards of directors by the end of 2019.  By December 31, 2021, this requirement will expand to require that a minimum of two women must sit on boards with five (5) members, and there must be at least three women on boards with six or more (6+) members.  The corporations’ SEC 10-K form will be used to determine the location of the principal executive offices.

The bill requires that by July 1, 2019, the Secretary of State publish the number of domestic and foreign corporations whose principal executive offices are located in California and who have at least one female director. The bill also authorizes the Secretary of State to impose fines for violations of the bill, and provides that funds from these fines are to be available, upon appropriation, to offset the cost of administering the bill.

Penalties for non-compliance will be high, including fines of $100,000 for a first violation and $300,000 for a second or subsequent violation.  Companies must demonstrate their compliance by filing their board member information with the Secretary of State by the respective deadlines. Continue reading