Excerpted from North Carolina Employment Law Letter, written by attorneys at the law firm Womble Carlyle Sandridge & Rice, PLLC.

The Equal Employment Opportunity Commission (EEOC) issued a press release announcing that a large movie theater chain had agreed to a $765,000 settlement to resolve sexual harassment charges arising from a supervisor's conduct at a Raleigh theater. Here's another reason to make sure you have an appropriate sexual harassment program in place. In addition, you should consider whether you should do background checks for employees in jobs that deal with young people, elderly, or other at-risk groups.

Facts

The EEOC sued Carmike Cinemas, Inc., a large movie theater chain operating 312 theaters in 36 states. The lawsuit claimed that 14 young men working in a Raleigh theater were subjected to unwelcome sexual touching, egregious sexual comments, sexual advances, and requests for sexual favors from their male supervisor between February and October 2003. A lawsuit claimed that the supervisor was a convicted sex offender.

Settlement

The EEOC says the payment of more than three quarters of a million dollars is the largest damages amount in an EEOC harassment lawsuit involving teenagers since the agency began tracking the issue in 2001. In addition to the monetary payout, Carmike must take the following steps at its theaters in North Carolina and Virginia:

• distribute its sexual harassment policy to all new hires;
• post a revised summary of the policy at each theater;
• provide annual training about sexual harassment and unlawful retaliation to all managers, supervisors, and new hires; and
• post an employee notice at its theaters about the lawsuit and employees' rights under the federal discrimination laws.

EEOC v. Carmike Cinemas, Inc., Civil Action No. 5:04-CV-673-BO(1)(E.D.N.C.).

What this means for you

If a supervisor engages in sexual harassment that affects a tangible employment benefit (e.g., job status, pay rate, promotion, or benefits), the employer can be held automatically liable for the supervisor's conduct even if it didn't know about it.

For that reason, it's crucial to have a comprehensive harassment policy and provide employees with frequent training and reminders on how to report sexual harassment claims. Encouraging early reporting can help prevent expensive claims if you promptly investigate the reports and take appropriate corrective action.

If you haven't conducted training on your harassment policy recently, you should consider putting that on your agenda.