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Business Protection Bulletin


By August 1, 2009No Comments

In the modern workplace, men and women work together for eight or ten hours a day; sometimes even longer. When people spend that much time together, it’s not surprising that occasional romances will bloom. Many people have met their spouses at work. Unfortunately, workplace romances don’t always have happy endings. When a couple in an office breaks up, the atmosphere can become, at best, uncomfortable and, at worst, hostile. Productivity can suffer as the ex-partners feud with each other. More serious, in some cases the firm might have a significant financial exposure when love goes wrong.

Relationships between two people of equal position in the company might not be cause for concern, but romances involving supervisors and their subordinates can expose the company to legal liability. Workers outside the relationship might detect favoritism toward the subordinate when he or she receives pay raises, promotions, or other desired rewards. Conversely, if the couple breaks up, the subordinate might be sensitive to any actions that smack of retaliation. In the worst cases, the subordinate could decide he or she is a victim of sexual harassment and take legal action against the company. The federal Equal Employment Opportunity Commission received almost 14,000 complaints of sexual harassment in 2008. Almost 30% of these settled in the injured employee’s favor, costing the employers $47 million, not including damage awards won through litigation.

Employers who wish to avoid close relationships with government investigators should consider several options, including:

  • Not having an office romance policy. Firms who choose this option might emphasize anti-harassment and anti-discrimination policies instead.
  • At the other extreme, some companies have outright bans on employee romances. Although this might have some appeal, it can be difficult to implement because the forbidden behavior could be hard to define. Also, courts might not uphold such a ban.
  • Some companies require employees who date each other to notify a company representative, such as the human resources manager, when the relationship begins and if it ends. This might protect the company from ensuing sexual harassment claims.
  • Many companies have policies against spouses working for the same company or against employees supervising significant others, spouses, or other relatives. This can make it less likely that other employees will perceive favoritism, but the company must apply the policy equal to members of both sexes to avoid discrimination claims.
  • Some companies actually require employees in a relationship to sign contracts. These agreements state that the employees have entered into a voluntary relationship, affirm that they understand the company harassment policy, describe how to report complaints, and describe acceptable and unacceptable behaviors.

In addition to adopting one of these options, employers can take some steps to reduce their chances of having to fend off sexual harassment claims. First, they should communicate to supervisors that relationships with subordinates should be avoided. They should create an environment where supervisors and other employees feel safe to report improper behavior. They should have policies against harassment and implement procedures for making complaints. They should take steps to end direct reporting relationships between romantic partners by transferring one of them, if possible.

Human nature being what it is, there will probably always be workplace romances. Thoughtful consideration and implementation of policy alternatives will help protect a company from potential resulting lawsuits. However, all the best precautions might still fail to prevent litigation, so all employers should carry Employment Practices Liability insurance. One of our experienced insurance agents can provide advice on the available coverage options and companies. With preventive measures in place and risk financing in the form of a good insurance policy, employers can focus on their top priorities: Growing their businesses.