Harass and Pay Big
Call it the $34-million message. That’s the record amount that Mitsubishi Motor Manufacturing of America agreed last week to pay to settle the largest sexual harassment lawsuit ever brought against a private company.
Lawyers helped the Japanese auto maker avoid a legal admission of guilt in the case, which involved its plant in Normal, Ill. But what the company has agreed to speaks volumes: Mitsubishi is obligated to place all harassment policies and future complaints by female workers under the supervision of a panel of outside monitors. The panel will follow the company for a year and report its findings to the federal court and to the Equal Employment Opportunity Commission, which brought the landmark suit against Mitsubishi. The deal must now be approved by U.S. District Judge Billy McDade, and he should do so without delay.
Nationally, sexual harassment charges filed with the EEOC have been on a steady rise, from 6,883 in 1991 to 15,889 last year. The cost of settlements has also jumped, from $7 million in 1991 to $50 million. Companies have responded in a number of ways. For example, more are buying what amounts to sexual harassment insurance. That may be a good business decision, but it’s no substitute for knowing what’s going on in a company.
Other companies depend on required arbitration. To be hired, a person must sign away the right to sue and agree instead to binding arbitration. This tactic has been challenged in the courts, with mixed results; it offers no guarantee that disputes will stay out of court.
The message to businesses in the Mitsubishi case is straightforward: If you ignore harassment complaints you do so at your peril and you should practice writing lots of zeros on corporate checks.
In 1996 the EEOC launched a class action lawsuit against Mitsubishi on behalf of at least 300 potential female claimants in the first federal case of this kind directed at sexual harassment. First the EEOC conducted its own 15-month investigation at the plant. Its report said that Mitsubishi managers had repeatedly been made aware of complaints of groping, crude graffiti, derogatory epithets and worse.
In 1997 the company was still denying the allegations, but a task force, paid for by Mitsubishi and headed by former U.S. Labor Secretary Lynn Martin, filed a report that painted a bleak picture of management failures at the plant. The report called for 34 changes that Martin said amounted to “a total restructuring of the company’s workplace.”
The bottom line here is that companies have a responsibility to maintain a respectful workplace. Some female Mitsubishi employees will be taking that fact right to the bank.
