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A Comprehensive Guide To Better Understand Sexual Harassment Compliance Fines

Compliance fines are the biggest concern for businesses throughout the United States. With violations spanning millions of US Dollars per year, and laws in states across the nation, it’s more important than ever to ensure your company and its systems are compliant. However, with federal laws and state regulations being somewhat different across the U.S., it can be a little confusing and difficult to understand as well as the potential risk of financial fines. That's not including any imprisonment charges.

EasyLlama is here to help, giving you the added security every step of the way. In this article, we will get you started with everything you need to know about compliance and how to avoid penalties.

Businesses Who Failed To Comply

Before we start, let's have some examples of businesses, two banks in fact, that have had compliance violations:

Goldman Sachs Group

In October 2020, an alleged sexual misconduct lawsuit was filed against the famous bank, Goldman Sachs. Within the claim, both the bank's General Counsel, Karen Seymour, and its Global Head of Litigation, Darrell Cafasso are accused. The claim stated that Cafasso would “romantically prey upon a much younger and vulnerable female colleague.” Seymour became involved when the law firm they hired was instructed to "sweep it under the rug."

Deutsche Bank

In the UK, the biggest sexual misconduct lawsuit was with Deutsche Bank. In 2000, the German bank and a female investment banker reached an agreed settlement outside of court. No one knows for sure the financial amount, but it is rumored to be above one million pounds.
 
Now, let's see what you need to do to avoid breaches and fines. Let’s start with the basics:

What does it mean to be Compliant?

In general terms, compliance means to obey an order or requirement requested by regulation. In this article, it is related to ensuring your employees are trained to understand what sexual harassment and discrimination can look like in the workplace, but also in their day-to-day lives.

It’s an enforcement law that requires all employees have completed their mandatory training, helping to prevent sexual harassment and abusive conduct in the workplace. Offering protection to colleagues as well as your customers and consumers. In some states, there is an account showing that this needs to be completed before your new starter arrives for their very first day.

There are requirements that all businesses, even those as small as five employees, are compliant with these laws as well as understanding the rules and possible penalties. Failure can result in breaches of the regulation, resulting in a violation and your company being fined.

From 2020, the below states across the U.S. require sexual harassment training for all private and public companies. Click the links below for articles with details on the legal definitions and data for your state:

 
Can’t see your state here? That doesn’t mean you don’t have to act.

In fact, not offering any training could result in a breach of conduct in many states across the country. So even though there is unlikeliness to receive a fine due to a violation, for your security, it is recommended to provide training to everyone in your business.

Training also needs to be regularly updated, and authorities will check on you and your processes to ensure this is kept up to date. Typically, training needs to be updated every two years with employers needing to keep compliance certificates for a minimum of two years. This evidences a need for a learning management system that records and reports all individuals' training status and keeps a history of their scores as well as certificates.

What is defined as Sexual Harassment and Discrimination?

Sexual harassment across regulations is identified as unwanted sexual advances but also visual, verbal, or physical conduct of a sexual nature. The definition includes many forms of offensive behavior and includes gender-based harassment, covering anything from derogatory jokes to sexual favors. This does not exclude personal data or personal information record leaks.

Discrimination within the workplace can take many forms, but it is defined as not ensuring full and equal accommodations, advantages, facilities, privileges, or services in all businesses. It is not limited and includes various locations such as hotels, restaurants, beauty salons, and retail establishments. An example of violations and bad practices (but not restricted to) are:

  • A hotel charges additional service fees to a certain racial group and not other guests.
  • Visually impaired persons or those with mental health issues refused access as their service animal isn’t allowed on the premises.
  • Same-sex couples being denied a table at a restaurant
  • Promoting “ladies night” discounts on admission and services
 
In January 2018, StopStreetHarassment states that a GFK survey records 81% of women and 43% of men, a report conducted throughout America, experienced some form of sexual harassment and/or assault in their lifetime. Meanwhile, in 2017, Pew Research Center, on an investigation, found that one in four Americans has experienced online sexual harassment. Processing these results, states identified risk to their citizens and needed to act, leading to new rules enforced by law.

With an increase of sexual harassment and discrimination accounts in the workplace, all businesses now recognize the importance of training and management. Companies now compliant can help protect their staff and customers alike by leading as an example. Those who have failed to act by supporting their staff will receive a penalty. This training helps employers and employees by eliminating any form of physical or verbal harassment as well as discrimination among co-workers while promoting a safe workplace for all. It also generates awareness of any related discriminative practices and sexual harassment within the workplace.

How much are Compliance fines?

The heart of the matter. How do you need to protect your money?

It was reported by the U.S. Equal Employment Opportunity Commission in 2011 that a total cost of fines reached $52.3 million U.S. Dollars. This doesn't reflect companies that had to pay any settlement to victims either in or out of court. Although this is fairly recent history, laws have updated since this date. It’s now more likely to receive financial penalties than ever before, meaning this statistic could have significantly increased.

A fine can range from a few hundred dollars to thousands, depending on the size of your business. The biggest compliance fines may not necessarily be a financial issue, as some states include imprisonment in their enforcement penalty. As always, laws and the cost of a fine are always changing, but what is not evident in this cost is your reputation. State laws and their compliance fines do not cover the impact that these fines will have on your business reputation. Sexual harassment accounts added to your company's personal data while having impacts on your consumer base, and could result in traffic and profit loss.

Not all states have released data on penalties and the financial cost of receiving a fine, but there are some examples below:

Compliance fines in Connecticut

Connecticut’s new rules came into effect on October 1, 2020. Here, employers with three or more staff members must provide sexual harassment training to everyone. If your business has less than this number, training must be provided for all supervisors. 
Breaches can result in fines up to $1000.
Check out EasyLlama’s Connecticut training for sexual harassment compliance to get your company certified and adhering to the laws.

Compliance fines in Illinois

In Illinois, all businesses from July 1st, 2020 must provide training to all their staff. No company is exempt, as businesses with as little as one employee must comply with the sexual harassment training mandate. 
Fines differ in the size of your business.
  • Companies with less than 4 workers will receive penalties of $500 for the first offense but up to $3000 for the third offense.
  • Companies with more than 4 employees will receive penalties of $1,000 and $5,000 for the same offenses.
 
Try EasyLlama’s Illinois sexual harassment training to get your staff members compliant with the law.

Compliance fines in New York

In New York state (not just the city), a law passed in 2019 requiring all personnel to have sexual harassment training. This also includes part-time, seasonal, and temporary workers to offer complete protection within the new rules.
Penalties in New York aren't only money fines but can also include serving a prison sentence that will remain on record. These look like:
  • 15 days imprisonment or/and $100 for the first offense.
  • 30 days imprisonment or/and $500 for the second offense.
  • 60 days imprisonment or/and at least $300 for the third offense
 
 

How to avoid Compliance fines and violations?

Avoiding compliance fines is pretty easy and a very simple thing to remedy, however, it’s not as simple as just training your staff. Processes for management need to be added to your Human Resources (HR) system to stay protected (we offer a free HR compliance checklist!). Businesses should be ensuring all your staff members are given adequate training, not just mandatory, as well as keeping them up to date with any changes. This will serve you as future protection against any further amendments to state rules.
With requirements different throughout the country, it’s really important to ensure you're using the required information by your state but also knowledge to future-proof your teams. With EasyLlama, we make compliance and training simple, engaging, related, and accessible for all your staff members. 

How EasyLlama helps you stay compliant.

No more boring slides full of technical jargon that is too complicated to understand. We’ve also included real-life and realistic videos and quizzes. EasyLlama offers a training website accessible from anywhere, meaning your non-desk teams can take part whenever suits them by using a smartphone or shared device.

Keeping track of your personnel's compliance can be difficult, especially when updates are needed or holding their certificates securely. Our platform offers a user-friendly design that integrates with some of the most popular Human Resources and Learning Management Systems (LMS) around, such as BambooHR, Gusto, and Workday.

Take a look at EasyLlama’s plans to support you with your processes by offering a website that specifically fits your needs and security. We include yearly reminders, process updates, and multiple locations or departments. In short, we'll help you to avoid fines, deficiencies, and violations.