On March 24, 2009, the Department of Labor (“DOL”) issued a statement making clear that employers, including Hawaii employers, can expect an increase in DOL audits.  The statement, issued through Secretary of Labor, Hilda Solis, can be found at the DOL’s website, http://www.dol.gov/opa/media/press/esa/esa20090324.htm.

Among other things, Ms. Solis stated that she is “committed to ensuring that every worker is paid at least the minimum wage, that those who work overtime are properly compensated, that child labor laws are strictly enforced and that every worker is provided a safe and healthful environment.”

In addition:

The department’s Wage and Hour Division has already begun the process of adding 150 new investigators to its field offices to refocus the agency on these enforcement responsibilities. In addition, under the American Recovery and Reinvestment Act, the agency will hire 100 investigators to ensure that contractors on stimulus projects are in compliance with the applicable laws. The addition of these 250 new field investigators, a staff increase of more than a third, will reinvigorate the work of this important agency, which has suffered a loss of experienced personnel over the last several years.

Finally, Ms. Solis stated that:  “I am dedicated to ensuring compliance with federal labor laws to both strengthen our economy and protect workers in this country.”

Given the expressed intent of DOL, it is critical that Hawaii employers take the necessary steps, now, to both reduce the risk of potential liability connected to a possible audit AND to prepare for audit itself. 

Thus, Hawaii employers should at a minimum take the following steps prior to and during the audit:

After the audit is completed, it is critical that the Company not repeat any errors in policies or procedures identified by DOL.  Accordingly, any necessary revisions should be made promptly with assistance of counsel.

Roman Amaguin, Esq.; romanamaguin@yahoo.com; www.amaguinlaw.com

Roman Amaguin, Esq. is a Hawaii lawyer specializing in employment law, labor law, and civil litigation.

The present day labor law dates back to the 1930’s. The 1930’s have been called the New Deal era. It was during this time that Congress acted to raise minimum wage there was reconsideration of the labor laws that were affecting both private and public sector employees. There have been no major new laws that have been passed over the last few decades.

Early Labor Laws

Some of the early labor laws included the following:

The Clayton Act:

The Act stated, “The labor of a human being is not commodity or article of commerce,” and provided further that nothing contained in
The Federal antitrust laws: shall be construed to forbid the existence and operation of labor… organizations… nor shall such organizations, or the Members thereof, be held or construed to be illegal combinations or Conspiracies in restraint of trade under the anti-trust laws.

The Railway Act:

This Act was passed in 1926. It required those employers to bargain collectively and prohibiting discrimination against unions. It applied originally to interstate railroads and their related undertakings. It was amended in 1936 to include airlines.

Acts forbidden under the labor law

1) Dominating or otherwise interfering with formation of a labor union, including the provision of any financial or other support.

2) Interfering with or restraining employees engaged in the exercise of their rights to organize and bargain collectively.

3) Imposing any special conditions of employment, which tended either to encourage or discourage union membership. The law stated, however, that this provision should be construed to prohibit union contracts requiring union membership as a condition of employment in a company — a provision that, in effect, permitted the closed and union shops. (In the former, only pre-existing members of the union could be hired, in the latter. new employees were required to join the union.)

4) Discharging or discriminating against an employee because he had given testimony or filed charges under the Act.

5) Refusing to bargain collectively with unions representing a Company’s employees

Legislation which, except in specific exceptional circumstances, prohibit discriminating against one on the ground of one’s sex is not limited to but most often becomes involved in relation to or in the course employment, in, e.g., recruitment, job selection, terms and conditions of employment, training and promotion, and pay -including in the form of fringe benefits and redundancy pay and pensions.

In law, discrimination can be direct or indirect -or as harassment or victimization.

The law expects employers to have specific policies to ensure in all respects non-discriminatory treatment of all their employees of either gender or transgender -whether male or female and regardless of the marital status of men or women in their employ, and neglect or recklessness by the employer may make in law the employers (including vicariously) liable for sex discrimination or sexual harassment.

Sex discrimination is, simply, subjecting to less favourable treatment a person because of that person’s sex -because the person is boy or girl, is a man or a woman (including, in the case of female persons, whether pregnant, expecting, or with a baby or children as covered by the equality and employment legislation, and also male persons in relation to paternity leave), or because of that person’s marital status -because that the person is married or single -mostly applicable to married women.

It is also unlawful sex discrimination if on the ground of one’s sex one is not paid equally for what the law calls ‘equal work’ ~which is not necessarily same work but also is work of equal value -in other words such work that is like work or work which cannot be argued in law reasonably not to be work that is rated as being equivalent work (Hayward -v- Canwell Laird Shipyards 1988).

‘Pay’ in the European Union in Article 119 of the Treaty of Rome is defined this as being the ordinary, basic, or minimum wage or salary or any other consideration, whether in cash or kind, which the worker receives, directly or indirectly, in respect of his [or her] employment from [the] employer -including any benefit involved in relation to after the employment ends ~such as concessions in respect of travel benefits following retirement (Garland -v- British Rail Engineering 1982) and early-retirement pension (Barber -v- Royal Exchange Assurance Groups 1990).

Sex discrimination can be ‘direct’, or ‘indirect’.

Direct sex discrimination would be, for example, if one is refused employment on the ground that the job traditionally is regarded as being ‘a man’s job’ or as being ‘a woman’s job’ (Baksha -v- Say 1977).

Indirect sex discrimination is by way of a requirement which without reasonable justification can not be or can less be met by the other sex ~for example if a job advertisement said that the position advertised persons of either sex could apply but unjustifiably stated that hand-bags or purses were not allowed to work or must wear perfume -in England under European Union Law’s definitions it was held that it was unlawful discrimination that in government employment the age limit for appointment to executive officer grade was 28 since many women in their 20s planned or had babies to look after (Price -v- Civil Service Commission 1978).

It is equally unlawful sex discrimination to segregate male and female sexes without reasonable justification in places of work, as it is also to victimize one because of applicable e.g. feminism or feminist activity or if is known or suspected to have made or be intending to make an allegation of having been subjected to sex discrimination or sexual harassment.

Sexual harassment at work sometimes may also be a criminal offence ~in Europe the EU Code of Practice defined it as being unwanted conduct of a sexual nature or other conduct based on sex affecting the dignity of a woman [or a man] at work -it is a detriment on the ground of one’s gender (it was unlawful for example for two male employees to have made frequently remarks which were suggestive to one of their female colleagues and to have brushed against her deliberately causing such unpleasantness as to have necessitated her requesting to be transferred to another post -Porcelli -v- Strathclyde Regional District Council 1980).

In Europe the member states of the European Union must have an Equal Opportunities Commission or its equivalent to regulate these under e.g. the Sex Discrimination Act 1975 (supplemented by the Equal Pay Act, Maternity and Parental Leave Regulations, Maternity and Paternity (Amendment) Regulations, EE (Sexual Orientation) Regulations -and in the Employment Rights Act and the Employment Relations Act).

The Equal Opportunities Commission must also to provide information and assistance -including legal representation subject to meeting specified criteria, to persons who wish to complain to a county court, or in the case of trainees or employees to an employment tribunal.

The complaints process includes, if the person alleging discrimination so chooses, serving a questionnaire on the alleged discriminator -requiring to related questions written answers ~it may be used in evidence and inference be drawn from failure to respond or vague or ambiguous answers.

The person alleging discrimination may be, up to limits specified by law, in the case of the industrial / employment tribunals, ordered to pay costs, if the allegation proves to be unreasonably groundless, frivolous, or vexatious, and whereas financial remedy in respect of other matters is limited to a maximum, following a European Court of Justice confirmation there is, at the discretion of the tribunal, no limit on the amount of compensation which may be awarded for injury to feelings arising from sex discrimination in the workplace.

It is not unlawful sex discrimination, though, to discriminate in life or accident insurance risk assessment for employees fringe benefits justifiable by statistics, or in competitive sport if strength or stamina or physique matters -nor is it sex discrimination in employment if discrimination relates to, e.g., unadvertised managing of premises partly in one’s or relatives’ occupation, voluntary non-profit bodies or charities insignificant to other sex or statutory single sex colleges, or facilities which may embarrass men or women or would offend significantly a religion on grounds or privacy and decency.

Sex discrimination may be perfectly lawfully practised by employers, if there is an imbalance of male and female employees, without the dismissal of any by recruiting specifically from one sex alone, and in such cases as of necessity only from one particular sex must be recruited ~for example as in the case of a movie company’s advertising Edgar Rice Borough’s ‘Tarzan’ specifically for a male person or for his ‘Jane’ auditioning only female persons -or, e.g., in the case of a modelling agency employing as a fashion model only persons of one sex for modelling wear for that sex only.

Sex discrimination laws may vary in detail among countries that have such legislation, and in the European Union they are more or less uniform -in the case of allegations of discrimination in education in England (whether one does or not settle through the Advisory Conciliation and Arbitration Service -ACAS) with a requirement within a specified time before taking legal action to inform the secretary of state for education.(Laws change –always ascertain current law)The author has a website at: http://www.geocities.com/eoa_uk

Equal opportunities workplace discrimination in sex discrimination cover sexual orientation, same-sex prejudice, adoption, paternity, maternity, parental, dependant leave, marital status, equal pay; race relations employment discrimination ethnic relations, religious discrimination, nationality, citizenship; discriminatory practices, disability discrimination.

Sex equality, race relations, disability work rights in employment discrimination laws are:-A. It is employment discrimination contrary to nondiscrimination policy, unlawful prejudice, to treat employees e.g. working women, colored, foreign workers less favorably than others ~this is the basis of equal opportunities, nondiscrimination laws, in workplace discrimination, be it gender equality, racial equality, disability rights in employment -applying employment discrimination rights is illegal.B. It is illegal workplace victimization to penalize one for complaining or inquiring about or doing anything in good faith in relation to employment discrimination -be it about discriminatory practices of e.g. gender prejudice or sexual orientation or ethnic relations, even if there has not been, and even if the employer retaliation is not itself employment discrimination ~causing detriment after employment ends also is employment discrimination.

Important details of employment discrimination are:-Equal Opportunities are not minority rights, or women’s rights only ~it is equally illegal employment discrimination for e.g. black or women employers to subject to racial inequality or gender discrimination or sexual harassment a white an employee -in ethnic relations it is employment discrimination whether the employer belongs to a dominant majority group or a minority group.Lawful prejudice is possible: in employment discrimination, whether it is race relations, ethnic relations, or sex equality, employers are entitled to employment discrimination in recruitment by preferring a particular racial or ethnic or gender or sexual orientation class to ensure fair gender equality or racial equality respecting nondiscrimination policy ~non-employment of the disabled is legal employment discrimination if workers are less than 20 -or if a legal musts, e.g. safety helmet for Sigh bike messenger.Segregation, racial or ethnic, is not unlawful employment discrimination if genuinely otherwise it would disrupt ~in gender equality it is not illegal employment discrimination but lawful discriminatory practice to provide separate one-sex facilities to avoid embarrassment -it is also legal employment discrimination if it would offend a sizable faith.

Otherwise racial segregation can make liable in employment discrimination as race discrimination -if it arises from an employment discrimination complaint, additionally, also as employment victimization.Employment victimization if is due to, e.g., gender prejudice, an employment discrimination complaint must have preceded it – Negorajam -v- Agnew, 1994.Workplace harassment, be it sexual, religious or belief, ethnic or racial harassment, is more than employment discrimination -it can be, additionally to employment discrimination, a criminal offence ~also if it is only employment discrimination and on its own not of criminal nature, if persisted in, in employment or after termination.

Sex harassment or racist abuse by a colleague is not workplace harassment as employment discrimination if not in course of or at place of work nor related to work -action lies in equal opportunities but not as employment discrimination.

Workplace harassment, e.g., sexual harassment, is required in employment discrimination case-law to be shown to have adversely affected one’s dignity – Porcelli -v- Stratchlyde Rural District Council, 1980.Religious or Belief Discrimination it is in equal opportunities and employment discrimination, because of one’s religion or belief, to apply a condition on the assumption that a law would not be respected -e.g. an undertaking that Sigh builders would wear helmets at all times, or that a Sigh judge would wear instead of his turban the wig worn in British courts of law. Degrading treatment (which the above would also be) in employment discrimination under the race relations legislation (racial victimization -or religious, ethnic, color, nationality, citizenship) takes into account what the complainant considers to be degrading.Age Discrimination may also be complained of, if employee or candidate may is refused employment because of his or her age, or in employment if is less favourably treated or subjected to victimization. Disability discrimination while it is, in employment discrimination legislation, to not provide some 30% disability work for disabled employees in a workforce of 20 or more -with appropriate work and equipment and workplace adjustments, disability discrimination is subject to employment discrimination precedent and the courts may regard an employer’s failure in special interviewing arrangements not a discriminatory practice amounting to employment discrimination but failure of the disabled job applicant, even if the special arrangements need was stated on the application and details were never asked, if disabled persons fail to specify them .

Disability discrimination is legal if the workforce is less than 15 ~also if of indirect effect on disabled workers -it is employment discrimination only if it affects directly.

Disabilities do not entitle to equal rights or disability rights in disability employment discrimination unless for a year seriously disabled in ordinary daily activities -else it is not employment discrimination.Genuine occupational qualification excuses employment discrimination -in equal opportunities employment rights it is a genuine occupational qualification is one that does not unjustly disqualify an entire class of, e.g., female workers or married women employees, or staff transsexual or of a different sexual orientation, or alien workers ~in employment discrimination such proof is on the employer in sex or race discrimination claims – Panesaar -v- Nestle 1980.Grading of employees vulnerable to employment discrimination -e.g. of working women or black or immigrant workers, may be complained of as employment discrimination ~employer must show that were not taken into account personal factors, e.g. a working woman likely to take maternity leave or a single parent working girl, in assessing – National Vulcan Engineering -v- Wade, 1977.Maternity leave, paternity or parental or adoption or dependant leave, in employment discrimination laws are for all -married, partner, or neither ~if it is agreed contractually, employment discrimination laws forbid employers to prefer the contractual or the statutory entitlement -in equal opportunities applicable to employment discrimination employees choose which.Comparison must be made if one is directly subjected to employment discrimination to show that employment discrimination to have been by way of less favorable treatment of the complainant than other workers – Aziz -v- Trinity Taxis, 1998.Less favorable treatment complained of as employment discrimination must have taken place at the workplace or must be in relation to employment, otherwise it is not employment discrimination ~in ethnic relations, e.g., employer’s excluding from a house-warming party is not equal opportunities race equality breach of nondiscrimination policy -but it is employment discrimination if from a workers’ office party – Walters -v- Metropolitan Police, 1997.Equal pay if the employment discrimination has been in respect of, it is inessential for comparison to be of identical work -in employment discrimination precedent similar work suffices, e.g., a single working girl’s work and a married working woman’s like work – Hayward -v- Canwell Laird Shipyards, 1977.Internal Appeal offer in employment discrimination must precede worker’s dismissal, if made – James -v- Waltham Holy Cross Urban District Council, 1973.Claims for employment discrimination or, e.g., sexual harassment or color victimization must allege so -if the worker only claims only unfair dismissal the qualifying period may bar an, e.g., race equality employment discrimination case exempt from the qualifying period requirements – British Airways Engine Overhaul -v- Francis, 1981.Qualifying period for suing does not apply to employment discrimination and workplace harassment -no particular length of service need be shown to sue for employment discrimination ~also so in equal opportunities workplace victimization.Time limit does apply -in employment discrimination legal proceedings must be commenced within three months of the equal opportunities breach or of when the employment discrimination, or the employment discrimination victimization, became known – Cornelius -v- University College -Swansea 1987.Questionnaires are part of equal opportunities claims in employment discrimination whether sex discrimination, color prejudice, workplace harassment, or employment victimization ~one may serve one on the employer and use answers or non-reply in arguing employment discrimination.Amendments may be allowed by employment tribunals to employment discrimination complaints, only if are about a matter included in the in employment discrimination particulars – Swiss Life & Health Insurance -v- Kay, 2004.Additional claims based on same employment discrimination also so – Ashworth Hospital -v- Liebling, 1996.Onus of proof in employment discrimination is the complainant’s on a balance of probabilities ~regard to employer’s reasons for the alleged employment discrimination can reverse that – Humphrey’s -v- Board of Management of St. George’s School, 1978.

The European Court of Justice has ruled in employment discrimination cases that there is no limit on what may be awarded for injury to feelings in claims arising from workplace discrimination.

Costs may be involved if a party, including the complainant, has been vexatious, frivolous, or “otherwise unreasonable” –normally, in the course of or in relation to the proceedings.

Laws change; these are brief guidelines.The author has a website at: http://www.geocities.com/eoa_uk

It is well established now under federal Title VII law that an employer is liable for actionable sexual harassment caused by a supervisor with “immediate (or successively higher) authority over the employee.”  However, in cases where the employee does not suffer a “tangible employment action,” such as discharge, demotion, or an unfavorable reassignment, there is an affirmative defense that an employer may raise to avoid Title VII liability and damages.  

Under such affirmative defense whether an employer has an anti-harassment policy is relevant evidence.  Also important is effective supervisory training and training of employees on the harassment policy and complaint procedure.

Training and educational programs for all employees take on an even higher degree of importance under Hawaii state law, HRS Chapter 378.  State law currently is interpreted by the Hawaii Civil Rights Commission (“HCRC”) as mandating strict liability for sexual harassment committed by supervisors. 

While the Hawaii Supreme Court has not addressed the HCRC’s interpretation of HRS Chapter 378 a recent Illinois Supreme Court decision upheld a Illinois Human Rights Commission ruling addressing a regulation similar to the HCRC’s–that an employer was strictly liable for a supervisor’s harassing conduct under Illinois state law even though the supervisor did not even have direct supervisory authority over the Complainant.

The April 16, 2009 Illinois decision will certainly be persuasive authority to a Hawaii Supreme Court faced with interpreting the HCRC’s regulation.  Accordingly, it is critical that Hawaii employers understand the importance of having an effective policy and company-wide training program on not only a defense to a sexual harassment claim, but prevention.

I.          The Importance of Having an Effective Harassment Policy

A.                The Faragher/Ellerth Defense

Having an effective sexual harassment policy and training program will greatly increase the chance of avoiding liability under the affirmative defense for sexual harassment claims recognized by the U.S. Supreme Court in Faragher v. City of Boca Raton, 524 U.S. 775 (1998) (“Faragher”) and Burlington Industries v. Ellerth, 523 U.S. 742 (1998) (“Ellerth”). 

Where alleged harassment by a supervisor does not culminate in an adverse (“tangible”) employment decision, the employer may avoid liability by showing that: (1) the employer exercised reasonable care to prevent and promptly correct any harassing behavior; and (2) the plaintiff unreasonably failed to take advantage of any preventive or corrective opportunities provided by the employer to avoid harm.  “A tangible employment action constitutes a significant change in employment status such as hiring, firing, failing to promote, reassignment with significantly different responsibilities or a decision causing a significant change in benefits.”  Ellerth, supra.

The importance of the Faragher/Ellerth defense was significantly increased by the U.S. Supreme Court’s decision in Pennsylvania State Police v. Suders, 542 U.S. 129 (2004), which held that the defense is available in constructive discharge cases unless the plaintiff quits in a reasonable response to an employer-sanctioned adverse action of an official nature, such as a demotion or a cut in pay.

A zero-tolerance harassment policy must fit the environment and employees.  The Ellerth court stated:

While proof that an employer had promulgated an antiharassment policy with complaint procedure is not necessary in every instance as a matter of law, the need for a stated policy suitable to the employment circumstances may appropriately be addressed in any case when litigating the first element of the defense.  The policy should be written in plain English, so that all employees regardless of their educational level or background can understand it … [a] policy should include a clear and precise definition of unlawful harassment so that employees know what type of conduct is prohibited by the policy and will be able to recognize that conduct should it occur.

Accordingly, if the alleged harasser has supervisory authority over the victim, the employer will be held automatically liable for any harassment committed by the supervisor unless the employer is able to successfully raise the affirmative defense. 

B.        Tips On Drafting a Zero-Tolerance Policy and Complaint Procedure. 

(1)               Write in simple English.

(2)               Include a clear definition and examples of prohibited conduct and make it broad enough to prohibit all forms of harassment.

(3)               State the company’s “zero-tolerance” philosophy in the policy regarding all forms of harassment,

(4)               Designate at least two specially trained managers who will be responsible for investigating harassment complaints for the company. 

(5)               Determine the complaint procedure that will be used to investigate complaints of harassment by supervisory employees, co-workers and outsiders. 

(6)               Provide a “clear chain of communication,” allowing employees to step outside of the normal hierarchy in the event the supervisor is the harasser and consider having a toll-free number employees can call.

(7)               State that employees who report prohibited conduct will be protected from retaliation.

(8)               State that the employer will promptly investigate the matter in an objective and discrete manner.

(9)               Provide the form of disciplinary action to which offenders can expect to be subjected.

(10)           State that the employer will also take remedial action.

(11)           Train your management employees and line employees on the policy and procedure. 

(12)           Have each employee sign an acknowledgment form that they have received a copy of the policy and procedure, and that they have received training on the harassment policy. 

C.        The Faragher/Ellerth Defense and Hawaii Law

Like Title VII, the Hawaii Employment Practices Act prohibits discriminating against individuals in virtually all aspects of employment.  However, it remains an open question whether an employer, under Hawaii state law, can assert the Faragher/Ellerth affirmative defense. 

Currently, under regulations promulgated by the HCRC, the state agency charged with the enforcing and interpreting Hawaii’s Employment Practices Act, strict liability would apply to a supervisor’s harassment of a subordinate regardless of whether tangible action is taken:

§12-46-109 Sexual harassment.

(a)        Harassment on the basis of sex is a violation of chapter 378, HRS. Unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct or visual forms of harassment of a sexual nature constitute sexual harassment when:

(1)        Submission to that conduct is made either explicitly or implicitly a term or condition of an individual’s employment; or

(2)        Submission to or rejection of that conduct by an individual is used as the basis for employment decisions affecting that individual; or

(3)        That conduct has the purpose or effect of unreasonably interfering with an individual’s work performance or creating an intimidating, hostile, or offensive working environment.

(b)        In determining whether alleged conduct constitutes sexual harassment, the commission will look at the record as a whole and at the totality of the circumstances, such as the nature of the sexual advances and the context in which the alleged incidents occurred. The determination of the legality of a particular action will be made from the facts, on a case by case basis.

(c)        An employer shall be responsible for its acts and those of its agents and supervisory employees with respect to sexual harassment regardless of whether the specific acts complained of were authorized or even forbidden, and regardless of whether the employer or other covered entity knew or should have known of their occurrence. The commission will examine the circumstances of the particular employment relationship and the job functions performed by the individual in determining whether an individual acted in either a supervisory or agency capacity.

(d)       With respect to conduct between employees, an employer shall be responsible for acts of sexual harassment in the workplace where the employer or its agents or supervisory employees knows or should have known of the conduct and fails to take immediate and appropriate corrective action. An employee who has been sexually harassed on the job by a co-worker should inform the employer, its agent, or supervisory employee of the harassment; however, an employee’s failure to give such notice may not be an affirmative defense.

D.        Problem Areas for Employers

* Inadequate complaint procedure

* Failure to disseminate policy

* Employer on notice of harassment

 * Failure to promptly investigate

 * Failure to take appropriate disciplinary action

 * Failure to apply it even-handedly

 * Failure to review and revise when necessary

 * Failure to provide training

E.         Illinois Supreme Court Decision a Foreshadowing of Hawaii Law?

In Sangamon Cty Sheriff’s Dep’t v. The Illinois Human Rights Comm’n, Nos. 105517, 105518 cons. (Ill. Apr. 16, 2009), decided on April 16, 2009, the Illinois Supreme Court gave the HCRC direct support of the HCRC’s own interpretation of HRS Chapter 378.

The Sangamon decision holds Illinois employers strictly liable for sexual harassment by any of their management or supervisory personnel, and, as noted by the dissent, “imposes a standard of liability which appears to be without precedent in any jurisdiction of the United States.”

In that case employee Feleccia filed a sexual harassment claim against employer Sangamon County Sheriff’s Department and Ron Yanor, who was a supervisor, but was not Feleccia’s direct supervisor.  The Illinois Human Rights Commission ruled that the Sheriff’s Department was strictly liable for Yanor’s conduct under the Act because Yanor was a supervisor. The Illinois appellate court reversed, and Feleccia and the Commission appealed to the Illinois Supreme Court.

The Illinois Supreme Court reversed and confirmed the Commission’s decision. In a 4-2 ruling, the Illinois Supreme Court agreed that the Sheriff’s Department could be held strictly liable in such circumstances.  The basis of the decision was the plain and ordinary meaning of the statute, which states that “an employer shall be responsible for sexual harassment of the employer’s employees by nonemployees or nonmanagerial and nonsupervisory employees only if the employer becomes aware of the conduct and fails to take reasonable corrective measures.”

According to the Court, the statute is unambiguous” and only excludes “nonemployees” and “nonmanagerial or nonsupervisory employees” from its strict liability standard.  As such, the Court found “[t]here is no language in the Act that limits the employer’s liability based on the harasser’s relationship to the victim.”  The Court rejected the employer’s argument that federal case law should apply to the case.

II.        The Importance of Conducting EEO Training

Of course, in Hawaii the HCRC has merely interpreted HRS Chapter 378’s statutory language to impose strict liability for supervisory harassment.  Unlike the Illinois statute interpreted by the Illinois Supreme Court it is reasonable to argue that Hawaii statutory law is ambiguous and not straightforward. 

Nevertheless, the HCRC is charged with the interpretation and enforcement of HRS Chapter 378 and it does not bode well for Hawaii employers that another state’s high court is willing to impose what some would consider harsh penalties on the employer defendant.  Accordingly, employers in Hawaii should redouble its efforts to train supervisors AND employees regularly on preventing discrimination and harassment in the workplace.  Training should include the consequences of violating company policy.

Training employees reduces the likelihood that inappropriate conduct will be engaged in or tolerated at a level that can create a hostile environment.  See Arquero v. Hilton Hawaiian Village, 104 Hawai’i 423, 91 P.3d 505 (2004) (coworker pinched buttocks of the plaintiff on two occasions); Nelson v. University of Hawai’i, 97 Hawai’i 376, 38 P.3d 95 (2001) (verbal harassment).

Second, in the event that inappropriate conduct takes place, employees who are offended will be substantially more likely to use the employer’s complaint procedure, thereby permitting the employer to remedy the situation and avoid having a lawsuit filed against it.

Lastly, training is a tool for prevention and reducing the potential of supervisory harassment.

A.        Training as a Tool for Prevention

The EEOC’s Policy Guidance on Sexual Harassment states:

An employer should ensure that its supervisors and managers understand their responsibilities under the organization’s anti-harassment policy and complaint procedure. Periodic training of those individuals can help achieve that result.  Such training should explain the types of conduct that violate the employer’s anti-harassment policy; the seriousness of the policy; the responsibilities of supervisors and managers when they learn of alleged harassment; and the prohibition against retaliation.

The HCRC regulations state that “prevention is the best tool for the elimination of sexual harassment.  Employers should affirmatively raise the subject, express strong disapproval, develop appropriate sanctions, inform employees of their right to raise and how to raise the issue of sexual harassment, and take any other steps necessary to prevent sexual harassment from occurring.”  §12-46-109(g).

As part of its settlements against employers, the EEOC and HCRC have chosen mandatory training as one of its primary responses through the use of consent decrees requiring organizations to conduct training and ensure policy compliance.

In 2004, the California Legislature passed Assembly Bill 1825, requiring all employers with fifty or more employees to conduct compulsory sexual harassment training for all of its supervisory employees by January of 2006, thus supporting the EEOC and HCRC’s position that training and education is the best tool for prevention.  Under the California law, the training must re-occur every two years, and all new supervisors brought in after the original round of training must go through the program within six months of their arrival. 

Managers who are aware of the implications of sexual harassment may be less likely to take official action they realize will create vicarious liability for the organization – this may preserve the employer’s right to the Faragher/Ellerth affirmative defense in a case of constructive discharge.  Further, managers who are aware of how to proceed with complaints from employees about harassment are more likely to intervene with an appropriate employer response thus making a stronger showing under the first prong of the Faragher/Ellerth affirmative defense.

Finally, as noted throughout this article training can be an effective tool to combat inappropriate behavior by supervisors and to reduce risks under state law—especially to the extent it is interpreted similar to the Illinois Supreme Court’s decision.

B.                 Training and the Faragher/Ellerth Defense

Conducting training will greatly increase the chance of avoiding liability under the Faragher/Ellerth affirmative defense.  The importance of this defense was significantly increased by the Suders decision, which held that the defense is available in constructive discharge cases unless the plaintiff quits in a reasonable response to an employer-sanctioned adverse action of an official nature, such as a demotion or a cut in pay.

The training of rank and file employees should be documented and if it is to be conducted on a regular basis, can include a certification by the employee that he or she has not been subject to any policy violations since the last training.

C.        Training and Damages Issues Under Hawaii Law

Generally, individuals cannot be found liable for violations under federal law.  Under Hawaii law, however, courts may award unlimited punitive and compensatory damages. 

Significantly, unlike under Title VII individuals can be held liable for violations of Hawaii’s Employment Practices Act.  See HRS §378-1 (defining “employer” to include “any person”) and §378-2 (3) (making it unlawful for any “person” to “aid, abet, incite, compel, or coerce the doing of any of the discriminatory practices forbidden by this part, or to attempt to do so.”); Schefke v. Reliable Collection Agency, 96 Hawai’i 408; 32 P.3d 52, 93-94 (2001) (holding individuals may be found liable under Hawai’i Employment Practices law).

Thus, training employees may alert them to the financial risks they take when they engage in behaviors prohibited by Hawaii law.

D.        Training to Reduce Exposure to Punitive Damages

In Kolstad v. American Dental Association, the Court held that “in the punitive damages context, an employer may not be vicariously liable for the discriminatory employment decisions of managerial agents where these decisions are contrary to the employer’s ‘good-faith efforts to comply with Title VII.’”  Accordingly, compliance efforts are both necessary and sufficient to avoid liability for punitive damages.

Roman Amaguin, Esq.; http://www.virtualhawaiiemploymentlawyer.com; http://www.amaguinlaw.com

Whistleblowers may identify and report actual theft, false claims, over billing, up coding, unbundling, kickbacks, false certifications, violations of governmental regulations, destruction of company records, workplace violence, safety hazards or unsafe working conditions, environmental concerns, substance abuse, general conflicts of interest, release of proprietary information and other types of fraud or occupational concerns.

Whistleblowers are protected by agencies and laws from the government which include:

. Americans with Disabilities Act (ADA)

. Civil Rights Act of 1866 (since amended numerous times)

. Federal Equal Employment Opportunity Commission (EEOC)

. Federal False Claims Act

. Occupational Safety and Health (OSH) Act of 1970

Under the OSH Act of 1970, employers may not discharge or in any manner discriminate against any employee because an employee has filed any complaint, or instituted or caused to be instituted, any proceeding under or related to this Act.

Additionally, the employer may not terminate an employee who has testified, or is about to testify, in any such proceeding.

Under the Act, an employee who believes that a work hazard exists, whether or not they have filed a claim, has legal protection to refuse to work if all of the following apply:

. The employee faces death or serious injury and the hazard is so clear that a reasonable person would agree with the seriousness of the hazard.

. The situation is so urgent that there is not time to eliminate the hazard through regulatory channels.

. The employee has tried to get the employer to

correct the dangerous condition and they have not complied.

OSHA also administers the whistle blowing provisions of thirteen other statutes, protecting employees who report violations of various trucking, airline, nuclear power, pipeline, environmental and securities laws.

The Federal False Claims Act provides the legal framework for claims alleging fraud against the federal government, and it does several important things for a whistleblower:

. Provides specific protection for the whistleblower from discharge, demotion, suspension, threats or other harassment or discrimination that the whistleblower may encounter due to lawful actions taken in the furtherance of a whistleblower claim, if the employee is still works for the employer.

. Provides for filing a whistleblower complaint under seal, which means that no one other than the government, not even the defendants alleged to have committed the fraud, can know of the complaint until after the government has investigated the claims.

. Anywhere from 15 to 25 percent of the entire recovery can be made in some instances by the whistleblower.

Eleven states and the District of Columbia also have their own false claims acts that closely resemble the Federal Act.

Whistleblower laws allow for the contingent fee representation of whistleblowers. The Federal False Claims Act also provides that a whistleblower’s attorney’s fees be paid by the entity that committed the fraud in the event of a government recovery. If the case is succesful, then there are no expenses or monetary costs to the employee.

Anyone who knows of fraud against the government can become a whistleblower. Usually it is employees or ex-employees who report fraud of a corporation because they have the most knowledge of internal operations.

The law only protects one whistleblower-based claim. The first to file based on specific information about a particular fraud preempts other whistleblowers and their claims. In addition, an employee cannot bring a whistleblower complaint if information about the fraud becomes public before bringing a claim.