Hotel Business Review

Mr. Schmidt

Hospitality Law

Harassment Concerns and Effective Policies for Hotel Employers

By Michael C. Schmidt, Partner, Cozen O'Connor

The scene is not uncommon, a beautiful hotel with several floors of luxurious rooms, restaurants and bars, and cascading waterfalls out at the pool. It is not your typical office, yet it is critical that hotel employers understand that the men and women who work in this setting are employees and that the hotel is a workplace. So, as informal, perhaps even as romantic, as the scene may be, employment laws proscribing harassment in the workplace apply in hotels as equally as they do in a medical practice, a law firm or an insurance brokerage house.

This article identifies the problems associated with not recognizing the unique dangers that exist when the hotel bedroom is also the workplace, and offers some best practices to effectively address the situation. At the outset, it is important to note that harassment on the basis of any protected status is unlawful and should be addressed in a hotel's employment policies, as well as in any internal harassment training. Thus, workplace harassment on the basis of an employee's (or a group of employees') age, disability, gender, race, color, religion, sexual orientation, or other protected basis, is unlawful and must be prevented. Nevertheless, sexual harassment continues to be the most prevalent type of harassment that occurs and forms the basis for lawsuits.

There are generally two types of sexual harassment - "Quid Pro Quo" and "hostile environment". "Quid Pro Quo" harassment occurs when a hotel supervisor, manager or someone in a position of power bases employment decisions or expectations on an employee's submission to, or rejection of, sexual advances or conduct. This type of harassment is the more obvious of the two, and may involve such employment decisions as hiring, firing, promotion, pay increases, work assignments, performance evaluations, and work shifts and locations. "Hostile environment" harassment occurs when verbal or nonverbal behavior or statements are directed at the sexuality of another person, are unwelcomed, are severe and pervasive enough to unreasonably interfere with an employee's work performance, and create an intimidating, hostile or offensive work environment. This type of harassment is more prevalent, but also more difficult to recognize and define. Examples of this type of harassment include off-color jokes or teasing; comments about another's body parts or sexual/personal activities; public displays of suggestive pictures, posters, screen savers or calendars; stares, leering, and repeated requests for dates; inappropriate touching; and offensive e-mail or electronic communications. Taken in isolation, one act or statement (where no touching is involved) may not constitute unlawful harassment. However, over time, repeated acts may become sufficiently pervasive and severe enough to interfere with an employee's ability to do his or her job. Furthermore, it is always recommended that a hotel strive not only to address conduct that may be deemed unlawful in the eyes of the law, but also conduct that is inappropriate in a work environment.

There have been many reported cases in which an employee has sued his or her hotel employer alleging harassment in the workplace. For example, a case in a Michigan federal court involved a housekeeper assigned to clean rooms.. Specifically, the employee noticed a broken door in one of the hotel rooms she was assigned to clean, called the front desk and waited for someone to come to the room to fix it. When the male maintenance worker came into the room, he initiated a conversation with the housekeeper, and ultimately grabbed her arm and propositioned her for sex in the hotel room. In another case in California, a hotel was found liable for sexual harassment committed by a hotel supervisor who engaged in vulgarities, made sexual remarks, and requested sexual favors from hotel housekeepers. The court found that the hotel could be held vicariously liable for the sexual harassment, because the general manager had knowledge of the conduct that seriously tainted the employee's work environment, and because the hotel did not have an effective anti-harassment policy and complaint procedure in place. Hotels need to take steps to address harassment in the workplace for four primary reasons:

• Executive and employee downtime.
  The waste of time and money required for key employees to focus on lawyers and lawsuits, rather than the operation of the hotel, cannot be understated.
• Employee relations.
  Though it should be obvious, many still do not recognize the old adage that a happy employee is a productive employee, and a workplace permeated with inappropriate harassment can negatively affect employee morale, and, consequently, result in decreased productivity.
• Public perception.
  These lawsuits, and the bad press that undoubtedly comes with them, can have a negative impact on the public's perception of the hotel. The public may decide not to stay at a hotel that becomes known in the press as an employer that "sanctions" harassment and discrimination in the workplace.
• Financial damages.
  The issue of workplace harassment should be addressed in order to avoid the hotel's liability for significant damage awards in a lawsuit. The financial stakes are high, as an aggrieved employee who is successful in litigation may be entitled to back pay, the monetary value of lost benefits, reinstatement or front pay in certain cases, mental anguish damages, punitive damages, and the payment by the hotel of an employee's own attorneys' fees. This is on top of the legal fees the hotel will pay for its own defense counsel.

It is important to note that while a hotel may be held liable in some cases for the acts of its supervisors, there are strategic decisions that can be made early on in a lawsuit to curb damages. This includes exploring early motions to test the sufficiency of a complaint, crafting positions to respond to a complaint, and defining initial discovery that can help shape a proper and effective defense to a sexual harassment lawsuit. In addition, the U.S. Supreme Court has permitted employers to assert an affirmative defense in certain sexual harassment cases - if the hotel had an effective policy that provides prompt remedial action, and if the employee unreasonably failed to utilize that policy. Other courts have since ruled that an effective anti-harassment policy will be considered when determining whether to impose punitive damages against an employer. However, courts have held that a mere blanket proscription against harassment or discrimination is not enough. The policy must contain an effective and fair procedure for an aggrieved employee to seek redress. For example, a hotel should initially express its commitment to equal employment opportunities, and emphasize that any discriminatory and harassing statements or conduct will not be tolerated. The policy should define harassment and provide examples of what may constitute inappropriate harassment in the workplace.

Michael C. Schmidt is a member of Cozen O'Connor in the Labor & Employment Practice Group. A portion of his practice is devoted to advising large and small businesses how to avoid litigation and minimize exposure to claims. He has represented clients in the hospitality and restaurant industry in matters involving wage and hour, discrimination and employment contract disputes. Mr. Schmidt is an Adjunct Professor of Law at Touro Law School in Central Islip, N.Y., he teaches employment law. He lectures and conducts seminars for human resources professionals, corporate executives, and lawyers. Mr. Schmidt can be contacted at 212-453-3937 or mschmidt@cozen.com

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