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Preventing Workplace Sexual Harassment Through Leadership

According to the Equal Employment Opportunity Commission (EEOC): “Harassment in the workplace will not stop on its own—it’s on all of us to be part of the fight to stop workplace harassment. We cannot be complacent bystanders and expect our workplace cultures to change themselves.”

This truth cannot be overstated. 

For 30 years, the law, the media, and popular culture has reported about sexual harassment—and the need to eliminate it. It is appropriate, therefore, to ask: Why does so much harassment persist and take place in so many of our workplaces? And, most important of all, what can be done to prevent it? After 30 years, is there something we’ve been missing?

It could be said that the missing element is leadership. Too often, yet for good reason, dealing with sexual harassment in the workplace is something that management, executive directors, and chief executive officers often defer to others to handle and manage.

Perhaps the time has come to see the wisdom and efficacy of having nonprofit leaders become more personally involved in the necessary task of eliminating and preventing sexual harassment in the workplace.

Granted, the reality is that many of these individuals are very busy, taxed, and overworked. However, a demonstration by senior management and supervisors that they acknowledge, understand, and will take an active role in prevention can only have a positive effect upon the consciousness in the workplace that “zero tolerance” means just that.

In general, there are many ways to demonstrate this leadership. Here are just a few suggestions:

  1. Management should take an active role in training

The presence of these agency leaders and senior managers at training sessions impresses the importance of the subject onto staff. It signals that management is committed to the elimination of sexual harassment in the workplace.

  1. Train supervisors to monitor the workplace for policy breaches

Supervisors are uniquely positioned to monitor the interactions of staff with one another and to make inquiries if there is a hint toward any form of harassment. Supervisors should also monitor whether members of the staff show signs of being victimized.

  1. Proactively support enforcement and prevention

The need to effectively deal with sexual harassment in the workplace often presents management with a conflict of loyalties if the offender is a long-time employee, colleague, or friend. No one is too important, indispensable, or essential to an employer’s business to be disciplined for violations of a zero-tolerance policy, and managers should demonstrate the courage to handle these situations properly.

  1. Monitor and track complaints and investigations

While the complaint and investigation processes are properly delegated to staff with the experience and expertise to handle these critical functions, it’s also vitally important that management know how these actions are handled.

  1. Maintain an open-door policy

Nothing will encourage employees to come forward and report their experiences more than a senior manager who welcomes, supports, and empathizes with them.

The law has placed no greater importance on any single aspect of employment than the prevention and elimination of sexual harassment. While training and effective complaint and investigation policies have provided methods to achieve this goal, dedicated understanding, support, and encouragement by the leaders of an organization are essential to ensure that mission will succeed.

Terminating Employment

In 2015, Jeanette Ortiz had been working for Chipotle for 14 years. She was general manager of a restaurant in the Fresno, California, area and was being considered for a promotion that would have increased her pay by $25,000. Ortiz’s hopes were crushed when she was fired.

Ortiz had prepared an envelope of $600 in cash for a routine armored car pickup. When the armored car didn’t show up, Ortiz texted her manager to let him know. But the cash disappeared. To her shock, Ortiz was accused of the theft. Instead of the promotion that Ortiz was expecting, she was shown the door. Ortiz’s manager insisted there was video footage showing Ortiz stealing the cash, but refused to show it to her.

Ortiz felt Chipotle’s reason for the termination was a sham. She had recently been injured at work. Furious at having been accused of theft by her former employer, and convinced that her injury and resulting time off were the real reason for the dismissal, she sued Chipotle for wrongful termination. Was she right?

While all employers must proceed with caution when deciding to end their relationship with an employee, managers at nonprofits often feel they are subject to additional scrutiny than a for-profit business. It’s a common expectation that nonprofits will have a moral component to their management, even if those decisions are not related to the nonprofit mission. A messy termination can harm the nonprofit’s reputation with its funders, clients, staff, and the community. It can also make it more difficult for the nonprofit to recruit and hire employees. But with some careful planning, this risk can be managed.

There are a few simple tips for lowering risk related to employee terminations.

Be honest about the reasons for the termination

Many nonprofit managers believe that if employers have an at-will relationship with their employees, employers don’t have to provide a reason for a dismissal. This is a mistake. Being at-will does not mean an employee can be dismissed for no reason at all. An employee who is being involuntarily dismissed from employment should always know why. If an employee is experiencing performance problems, they should have received clear and direct feedback about the deficits in their work and the consequences for failing to improve. If the reason for dismissal stems from the employee’s own misconduct, the employee should have had an opportunity to give their “side of the story.” If they haven’t, then a thorough investigation hasn’t been completed, which can lead to ugly surprises down the road.

Try to be more specific than not

Avoid generalizations about the employee’s conduct and work quality. You may have a very clear idea in your head about what it means for an employee to not be “a good fit.” But if you don’t get specific with the employee, it’s only natural that they will hear the reasons that fit best with their understanding of the situation. Really think about what such a vague statement means to an employee in the absence of any specific feedback. If you’re told you’re “not a good fit” and you look around and see you’re one of only a few employees who is over 50, it’s easy to see how “not a good fit” can turn into “too old.” Be specific and objective in your explanation. Tie the reasons for the dismissal to your nonprofits mission. It’s okay if the employee doesn’t agree with you—in fact, it’s unlikely they will. Sometimes acknowledging that you can agree to disagree about the specifics is the best outcome that can reasonably be expected. The employee may not accept the feedback about their performance or conduct, but if they feel they have been treated with respect, it’s much easier for them to accept it’s time for them to move on.

Be prepared and plan ahead

Don’t wait until you’re ready to let go of an employee to consider the logistics. Make sure you keep track of whether the employee has company property and consider how you’re going to collect it. Make sure you have the ability to shut off access to your nonprofit’s computer systems. Just as importantly, think about what personal property the employee has at the worksite and how that property can be returned to them.

Make sure you know what should be included in their final pay, and when it needs to be provided to the employee. In some states, employers must provide all final pay owed to the employee at the time of dismissal.

If your employees are members of a union, make sure that you’ve followed the collective bargaining agreement, and be aware that it may call for specific steps or an internal appeal process.

Regardless of the circumstances of the end of employment, treat the departing employee with respect. The vast majority of people who sue their former employee will tell you the same story—they were angry because they felt they were treated poorly. Handing an employee a box and having them pack up their belongings, then marching them past their colleagues to the front door is a great way to buy your organization a lawsuit.

Finally, take all threats of violence seriously. No one wants to believe that a former colleague would ever cause harm, but unfortunately it does happen. If you receive or hear of such a threat always take it seriously. Report the threats to law enforcement, take steps to increase physical security at the workplace, and consider obtaining a restraining order.

Lawsuits have unpredictable results

Let’s turn back to Jeanette Ortiz, the Chipotle manager accused of theft. Three years after she was fired, the case went to trial, and Chipotle was unable to produce the video it claimed showed Ortiz stealing the money. Chipotle failed to make a solid record of the reasons they claimed they let Ortiz go. Ortiz, for her part, had over a decade of glowing performance reviews and she pointed out the only thing that had changed in her employment relationship was her workplace injury.

The jury found for Ortiz, awarding her a whopping $8M for lost wages, emotional and mental distress, and damage to her reputation. Punitive damages could have magnified the award even further, but before that could be decided, Chipotle quickly settled with Ortiz for an undisclosed amount. Chipotle learned a bitter lesson about proceeding with caution when it comes to employee terminations. Don’t let your nonprofit be next.

NIA members with Directors & Officers insurance with Employment Practices Liability are eligible for unlimited free employment-related consultations with our Labor & Employment Risk Managers. If you’re not a member of NIA, get a quote.

Contractual Liability: How Nonprofits Can Protect Themselves and Their Communities

In any negotiated agreement, each party should be liable for the things over which they have control.

Before you sign a contract, do you review it with your insurance broker?

Decision-makers at nonprofit organizations can better work with insurance brokers, identify potential problems with contracts, and navigate liability when signing a contract with local municipalities. The COVID-19 pandemic has created new challenges for nonprofit organizations around contractual liability. Fortunately, there are steps you can take to protect your organization and the communities you serve.

We always recommend that our members have someone with legal expertise review any contract before signing it. In this article, I’ll specifically cover issues of liability and indemnification in contracts.

How contract liability between nonprofits and municipalities has changed during COVID-19

Depending on how your nonprofit carries out its programs, a contract with your local municipality could cover anything from the work your nonprofit is doing for the community (for example, if you run childcare services or a food bank) to simply public space for a fundraising event (for example, a walk for the cure in a local park).

Even before COVID-19 became a public health concern, contract wording often pushed all liability onto the nonprofit, and in many cases, inappropriately so. That trend has continued. Immediately after COVID-19 emergency orders went into effect, we began to see wording being added to various contracts that shifted liability for any COVID-19 claims from the municipalities to the nonprofits. And for nonprofits that expanded their programming to assist their municipalities in COVID-19 relief efforts, we saw the addition of even broader language shifting liability onto those organizations.

Often, municipalities want the help from nonprofits to address issues in the community, but local government agencies try to pass off as much of the liability as they can to nonprofit partners as a way to control costs. So it’s important for decision-makers at nonprofits to understand what risks they are taking when partnering with municipalities, and to only agree to assume liability for things the nonprofit has control over.

Indemnification clauses

One of the main ways municipalities transfer liability is through the indemnification clause in the contract. This clause determines how the liability flows in case of a claim against the nonprofit or against the municipality.

An indemnity agreement is a risk transfer mechanism (a contract) in which one party (the indemnitor) transfers risk from (indemnifies) another party (the indemnitee).

What exactly does that mean in layman’s terms? The indemnification agreement attempts to ensure that liability for a claim is assigned to the party responsible for causing that claim, either through their direct action or through their negligence. Again, each party should be liable for the things over which they have control.

You want to make sure your nonprofit is covered in cases where there’s a claim from an error or omission on your part. Accidents happen and things are sometimes missed, which is why you buy insurance. However, you need to make sure you’re not being forced to cover someone else’s liability because of contract language that shifts others’ liability onto your nonprofit.

Here’s an example of a nonprofit project and a typical indemnification clause:

The city of Mos Eisley has a contract with the nonprofit Solo Foundation to set-up and manage COVID testing centers. Solo doesn’t do any of the testing nor do they handle any medical procedures or equipment. They simply setup the tents, direct traffic and check people in as they arrive. The city requires all of its contractors to include the following indemnification agreement in the Service Contract:

Consultant agrees to add the city of Mos Eisley as an Additional Insured and to hold harmless and indemnify the city of Mos Eisley, its officers, agents and employees for all claims, legal expenses or judgements which are caused by any negligence, liable act or omission of the consultant or those acting in the consultant’s behalf in the performance of your ongoing operations with respect to this contract.

A good contract would have mutual indemnification wording, where each party agrees to defend and possibly indemnify the other party for claims caused by their respective actions. Even considering the exposure to COVID claims, the above indemnification clause is fair. It references claims caused by the negligence of the nonprofit. This is not always the case in light of new liabilities like COVID-19.

By the end of 2020, both the reinsurance market and primary insurers started excluding or limiting coverage liability third party claims relating to the COVID-19 pandemic. In the case of a nonprofit, the vast majority of these third-party claims would be assertions that an individual contracted the virus because the nonprofit was negligent in taking precautions to mitigate the spread of the virus. This kind of claim would be difficult to prove, but it may leave your organization vulnerable to class action lawsuits, so it is important to work with your insurance broker to understand what kinds of expenses your nonprofit may be liable for under new insurance clauses.

Additional insured

An “additional insured” (AI) is a person or organization that enjoys the benefits of being insured under an insurance policy, in addition to whomever originally purchased the insurance policy (the named insured).

Here’s a real-life example:

A nonprofit hires a psychologist as a consultant to council its clients on-site once a week, in a group session. The psychologist requires, by contract, that the nonprofit add her as an additional insured on the nonprofit’s insurance policy. On the way to a meeting, one of the clients slips on a wet floor on the nonprofit’s premises and hurts their back. The client then sues the nonprofit and the psychologist as a result of the incident. As an additional insured, the psychologist would be defended by the nonprofit’s insurance policy.

Why would anyone want to be added as an additional insured? Because it helps to ensure that the party that’s liable for the loss holds the financial responsibility for a claim. As we’ve discussed, people should only agree to be responsible for the things over which they have control. In the case of our example above, the nonprofit should have been in control of keeping a safe environment by drying the floors. The additional insured (the psychologist) is being covered only for claims caused by the actions of the named insured (the nonprofit) to the policy.

An entity or person should only be added as an AI when there is some legal relationship between the nonprofit and that entity. In other words, if your organization is not being required by written agreement to add someone as an additional insured, you shouldn’t add them.

In some cases, the nonprofit will want to be added as an additional insured on another’s insurance policy. As an example, if the nonprofit has hired a contractor to do construction at the nonprofits location, it is a good idea to have that contractor, by way of a written agreement, add the nonprofit as an additional insured to the contractor’s insurance policy.

Arising out of vs. caused by

What makes an indemnification clause fair? There are a couple phrases the nonprofit should look for and try to avoid with respect to the indemnification clause. These phrases are “arising out of” and “sole negligence.” Here is the indemnification clause from our earlier example:

Consultant agrees to add the city of Mos Eisley as an Additional Insured and to hold harmless and indemnify the city of Mos Eisley, its officers, agents and employees for all claims, legal expenses or judgements which is caused by any negligence, liable act or omission of the consultant or those acting in the consultant’s behalf in the performance of your ongoing operations with respect to this contract.

Now, let’s change a few words:

Consultant agrees to add the city of Mos Eisley as an Additional Insured and to hold harmless and indemnify the city of Mos Eisley, its officers, agents and employees for all claims, legal expenses or judgements arising out of the performance of your ongoing operations with respect to this contract.

The first version states specifically that the claim must be caused by the nonprofit’s negligence. This is preferable, as the nonprofit should not accept liability for things outside their control. The second version is much broader in scope. It could be argued, inappropriately so, that any claim or loss that happens arises out of the nonprofit’s operations.

Here is a real-life claims scenario to illustrate that point (note that the names have been changed to protect anonymity of the organization):

Good Heart Housing leases apartments and houses to ensure the availability of low cost housing for their clients. They lease an apartment from Richard. Richard requires Good Heart to add him as an additional insured. In one of the apartments that Good Heart is using to house a family, there is a fire. The fire is caused by faulty wiring that Richard knew about but didn’t fix or tell Good Heart about.

It is clear that it was not the family’s or the nonprofit’s fault that the fire started. Should the nonprofit’s insurance (via the indemnification clause with “arising out of” wording) reimburse Richard for the loss?

Under the “arising out of” scenario, Richard could argue that this fire loss should be covered under the additional insured language because the fire was “arising out of” the nonprofit’s actions (renting the house). Under the “caused by” wording, it is clear that the fire was not caused by the actions of our insured (or the family). It was not the fault of either party that the fire started.

Sole negligence

Now let’s discuss the concept of “sole negligence.” Here is another example of a poor indemnification clause:

The Nonprofit agrees to indemnify, defend, and hold harmless The City, its agents, employees and officers, from any and all liability cost or expense, including but not limited to attorneys fees arising out of or relating to the performance of the work regardless of whether caused in part by the acts or omissions of the Nonprofit. Nothing herein shall be interpreted as obligating Nonprofit to idemnify The City against its sole negligence or willful misconduct.

Essentially, this clause means that if a claim is the result of the City being anything but 100% at fault, the nonprofit will be held responsible. In other words, let’s say the City is 99% responsible for a claim or The City can point to the sole negligence clause and try to push 100% of the liability onto the nonprofit. To make matters worse, it is very rare that a judge (or jury) would find either party 100% liable for any claim or loss. That is why some municipalities insist on this wording.

Nonprofits should push for better wording in contracts stating that indemnification for a claim will be allocated proportionally by the contribution of either party to that claim.

Top 3 ways to protect your nonprofit from additional liability

While COVID-19 presents a new risk for nonprofits in terms of liability, there are still fundamental best practices that can help protect your organization from taking on responsibility for events beyond your control. Here are three things you should look for in any indemnification clause for a contract you are going to sign:

  1. Make sure the wording refers to claims caused by your actions and not “arising out of” anything. The “arising out of” wording is too broad and could lead to liability being assigned to you that is out of your control. Don’t agree to take on liability for things outside your control.
  2. If you are agreeing to indemnify another party via a written agreement, ask that that party agree to also indemnify you (mutual indemnification). That way everyone is liable for the things over which they have control.
  3. You should ask that any “sole negligence” wording be removed. This type of wording will almost always lead to the indemnitor being responsible for all losses. Instead nonprofits should ask that indemnification for a claim will be allocated proportionally by the contribution of either party to that claim.

Before you sign any contract, it is always a good idea to have your broker review it to ensure your organization will be compliant with the indemnification and insurance clauses.

Managing Teleworking Employees

In 2017, in the middle of a live interview with BBC News, Professor Robert Kelly’s daughter marched stridently into the background, becoming an instant media sensation. Just four years later, the intersection of work life and home life is accepted as the “new normal,” and the sight of a child wandering through the background of a live meeting barely raises an eyebrow. Most nonprofit employers understand that the COVID-19 pandemic has changed our way of working—perhaps permanently—but the adaptation of policies and practices haven’t always kept up.

In the early days of the pandemic, nonprofit employers scrambled to implement telecommuting strategies. The crisis didn’t leave much time for considering the long-term implications of a “virtual workplace.” Now that over 70 million Americans have been vaccinated for COVID-19, more nonprofits are considering whether to require employees to return to the office, or to permit them to continue telecommuting. Many nonprofit managers are surprised to find that differing expectations about whether working from home is a right or a privilege are creating conflict. At worst, employers may face an expensive and time-consuming lawsuit.

Home as the New Workplace

Managing boundaries has been a particularly difficult area for employees to navigate when they suddenly became telecommuters. Last year when the pandemic first hit the U.S., stay-at-home orders were implemented across the country. As schools and childcare centers closed, employees took on additional roles at home that often overlapped with their work time. Gone was the traditional office environment that provided a physical barrier between employees’ professional and personal lives. For many employees, home and work have been taking place in the same space for a year or more. The challenge of balancing work and personal obligations is front and center.

Unfortunately, the majority of managers have never received any formal training in how to manage a remote workforce, much less a workforce dealing with competing demands on employees’ time. Managers themselves are experiencing burnout in having to maintain an inexhaustible supply of encouragement and positivity in the face of employees who are being asked to juggle multiple responsibilities for home and work.

Now is the time for nonprofits to begin implementing more robust policies and schedules for employees who continue to work from home. Employees may be reluctant to return to the office, or to compromise on a previously flexible schedule. Even after they have been trying to “do the right thing” for their employees, nonprofits are sometimes surprised to find they are not on the same page with their employees about the long-term strategy.

Disability Implications

Another challenge employers are facing is increased requests by employees to work at home for medical reasons. Many employees are concerned about returning to the office, especially if they have a condition that would make them particularly susceptible to COVID-19. In some situations, telecommuting can be a reasonable accommodation for an employee with a disability. But navigating that path can be tricky, and with disability discrimination cases climbing every year. Many nonprofits don’t realize that under the Americans with Disabilities Act, they are responsible for identifying situations in which an employee may need an accommodation and offering to engage in the interactive process. Employers can unintentionally create liability merely by saying “no” to requests like telecommuting without engaging in the legally required steps to determine whether such an accommodation is appropriate and necessary.

Organizational Culture

Nonprofit managers and their reports often bemoan the loss of the benefits of in-person discussions. Many studies show employees working remotely are actually more productive than they are in the office. But that often depends on the nature of the work. Research has shown that the more complex the interactions required as part of a particular job, the less likely that job can be fulfilled on a 100% remote basis. The casual knowledge transfer and social bonds that develop through in-person interactions are difficult to replace. Intentionally developing informal collaboration strategies—not just cheesy icebreakers—leads to increased engagement and employee retention.

Workplace Policies in the Virtual Workplace

Nonprofits remain responsible for ensuring that wage and hour laws are followed, even when employees are working remotely. Given the blurring of lines between work and personal time, how can nonprofits ensure that hourly employees accurately report their hours, including overtime? That situation can be further complicated when an employee already has performance problems. Managing employee performance in a remote environment brings a particular set of challenges that require careful consideration and management.

As difficult as it has been to suddenly launch a remote work strategy, many nonprofits have discovered the advantages of a remote workforce. Telecommuting has allowed nonprofit employers to hire from a much more widespread talent pool and reduce the overhead of maintaining physical workspace for all its employees. Fewer cars on the road helps reduce pollution. Even as the pandemic appears to wane, it’s clear that telecommuting in some form is here to stay. Nonprofits will benefit from an intentional implementation of a risk-conscious strategy for handling remote work.

Learn about risk management topics by registering for our webinars — free to all members of Nonprofits Insurance Alliance (NIA) and $45 for the general public.

Granting Employees Time Off to Vote

With the national election less than a month away, we’re already seeing pictures of long lines of early voters and reports that maintaining social distancing in polling locations due to the COVID-19 pandemic will likely increase the time it takes to vote. One thing is clear: Employers need to prepare for employees’ requests for time off on Tuesday November 3rd.

Over 600 national employers, encouraged by the Time to Vote movement, have chosen to make election day a paid holiday. If you don’t have election day as a holiday, it’s important to consider what employers’ responsibilities are for providing leave to vote.

Voting Leave Mandated

There are about twenty-two states that have laws granting employees the right to take paid time off to vote.1 Some states also require employees to be granted the entire day off if working the election as a poll worker or in the election’s office. There are many variations of these laws. Some require notices to be posted. Some specify the amount of time that the employee is eligible to take off and how the employee requests and schedules the leave with their employer. With all these details, it is important that you understand the specifics of the voting/election leave law in your state/locality. Generally, this information can be found on the website for the Secretary of State or the County Elections Office. For example, see the California Secretary of State Time off to Vote webpage with sample notices for employers. The US Election Assistance Commission and FiveThirtyEight also are great resources for state voting laws.

Although many employees may choose to vote by mail this year, some are choosing to drop off their ballots in person and may face long waits to do so. Whether a worker can ask for time off to vote early or drop off their mailed ballot is not typically addressed in the law, so employers should remain flexible about these requirements. If your nonprofit has employees who live in a neighboring state, it makes sense to follow the law where the employee will be voting, although that is also not clearly addressed in these laws either. Some states, such as Maryland, Oklahoma, Missouri, and Wyoming, require employees to prove that they voted to get the leave.

States without Voting Leave Laws

The remainder of states do not require employers to provide voting leave, but some of these states encourage employers to allow time off for voting. Employers in states that do not mandate voting leave should review their handbooks and policies to see if they offer voting or other accrued paid time off that could be used for this purpose. Employee requests for time off in states with no mandatory voting law should be processed in a non-discriminatory manner, without regard to any protected characteristic, such as race, gender, or other legally protected characteristic.

Get Prepared

All employers should take the following steps now to be prepared for Election Day:

  • Research your state and county’s election leave laws.
  • Provide any mandated notice to employees about their voting leave rights.
  • Consider encouraging employees to vote early or by mail if allowed in your state.
  • Solicit employee time off requests early to evaluate how many absences will need to be scheduled and managed. Review the applicable law to see what control the employer has, if any, regarding the timing of the leave.

Notes:

1These states have paid voting leave laws: Alaska, Arizona, California, Colorado, District of Columbia, Illinois, Iowa, Kansas, Maryland, Minnesota, Missouri, Nebraska, Nevada, New Mexico, New York, Oklahoma, South Dakota, Tennessee, Texas, Utah, West Virginia, and Wyoming.

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