Storm of Sexual Harassment Claims Expected to Continue
RCC: 3 Steps Employers Should Take Today to Mitigate Reputational Risk
ORANGE COUNTY, CA / ACCESSWIRE / March 23, 2018 / Rockwood Communications Counsel (RCC), a communications firm protecting and restoring reputations, today advised employers to note the acceleration of workplace sexual harassment reports are not just happening to celebrities in select industries as statistics prior to last October’s #metoo tsunami indicate a staggering 75%* of harassment cases went underreported.
A recent Wall Street Journal/NBC poll found that nearly 50% of employed women have been sexually harassed at work. The Journal has also reported that “Smart investors will ask boards what actions they are taking to mitigate these (sexual harassment accusation) risks.”
While criminal prosecution may have a statute of limitations, accusations and their reputational cost inflicted do not. “We’re seeing the tip of the iceberg,” says employment law attorney Marie DiSante, with Carothers DiSante & Freudenberger LLP. “There is a lot going on in the workplace now behind closed doors, and it’s only a matter of time before someone opens those doors and invites the public in. Companies will be facing increased damages from a potentially large backlog of unreported claims.”
Today, a company is more likely to lose an executive over sexual misconduct allegations (think Weinstein, Oxfam, LA Times, etc.) than a regulatory investigation. “After the news breaks, the initial response is crucial,” says Crystal Rockwood, CEO of Rockwood Communications Counsel. “You’re being tried in the Court of Public Opinion, a high wire act not suitable for the novice,” she adds. “If bad news is anticipated, damage can often be avoided with preliminary PR counsel.”
Reputational Management: An Ounce of Prevention…
According to the Equal Employment Opportunity Commission (EEOC), in 2017, US companies paid out $482 million* in public penalties with claims of retaliation as the most frequently filed charges. This figure doesn’t account for untold amounts more in cases settled privately. Legal costs are only the start, Wall Street downgrades; advertisers and investors flee; deals are canceled; customers and clients boycott while prospective employees shun these companies.
Fortunately, funds are available for employers to mitigate negative PR situations if they have crisis management reimbursement attachments in their insurance policies.
Josh Franklin, a trial attorney with Franklin Soto LLP, a law firm focusing on insurance recovery and business tort litigation, is familiar with the challenges faced by businesses in getting insurance companies to pay claims. “It’s critically important to negotiate for the approval and rates of your crisis management team at the time a policy is purchased, or at renewal, not at the time a claim is being made,” says Franklin.
Three Steps to Protect Employers
Obtain a supplement for “Crisis Management Reimbursement.” These cover the costs of crisis management experts and expenses to mitigate the fallout from such an event. Travelers, Chubb, AIG and other firms underwrite these policies typically with $25,000 to $300,000 coverage – enough to retain legal and crisis communications expertise and to settle all but the most egregious claims.
Develop a crisis plan, specific for sexual harassment allegations against management and staff. Crisis firms charge between $5,000 to $25,000 to consult and develop a plan with $10,000 an average, and higher for large, complex organizations.
Revise HR policies to reflect a true zero-tolerance policy. Incorporate training which covers the nuances that inadvertently undermine the zero-tolerance policies especially at business socials, and company happy hour gatherings. Insurers underwriting these Employment policies often provide their clients training and materials at no cost.
According to Ms. Rockwood, “This is not a meme or a trend we are witnessing, but a paradigm shift. Surprisingly, the Wall Street Journal reported an October study by theBoardlist and Qualtrics found that 77% of boards hadn’t talked about sexual harassment, 88% hadn’t implemented a plan of action as a result of recent revelations and 83% hadn’t evaluated the company’s risks when it came to sexual harassment.”
*EEOC https://finance.yahoo.com/news/cost-sexual-harassment-workplace-190250229.html
About RCC
Rockwood Communications Counsel, Inc. specializes in building, protecting and restoring reputations through PR counsel, crisis and issue management. RCC clients are in the private, public, and nonprofit industries.
Contact
Bri Smith
562-799-5565
info@rockwoodcc.com
SOURCE: Rockwood Communications Counsel
ReleaseID: 493996
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