May, 2017

May, 2017


     Two months ago, in this newsletter, I reported that according to Equal Employment Opportunity Commission numbers, sexual harassment claims increased 2% in 2016 over the prior year.

And the beat goes on.

Sexual harassment claims have received high profile publication recently based upon such claims levied at Fox News.

In an April 24, 2017 article in the Society For Human Resource Management, (“SHRM”), titled, “HR Lessons from Bill O’Reilly’s $25 Million Severance Deal,” the question is posed whether businesses which pay severance packages to well-known company leaders or star talent accused of wrongdoing are getting their money’s worth.

The article concerns the termination of Fox News Channel anchor Bill O’Reilly of the highest-rated prime-time show, “The O’Reilly Factor.”  The article states that Reilly would be leaving “following news reports that he and Fox had, over the past decade and a half, settled five sexual harassment allegations for about $13 million.”

It states that several media outlets, including inside sources, reported that Fox would pay O’Reilly a severance package worth up to $25 million, which is calculated to be about one year’s pay under his recently renewed contract.

Last year, CEO Roger Ailes parted with Fox News reportedly paying him a severance of $40 million amid allegations of sexual harassment and settlements with several female employees, including anchorwoman Gretchen Carlson.

It should be noted that none of the allegations against O’Reilly have been proved in a court and settlements always stipulate that an alleged sexual harasser and/or his/her employer do not admit any wrongdoing, i.e., a “non-admissibility clause.”

The article quotes Alan Johnson, managing director of Johnson Associates, an executive pay consultant in New York City, who states that employers “have to balance their legal rights not to pay severance with the negative effects of a prolonged negotiation or trial.”

In the consideration of severance packages, Mr. Johnson recommends the following preparation for companies, which could be material for a plaintiff’s employment attorney analysis, as well:

1.  Do your analysis. Find out what other CEO’s and senior talent in similar situations received when they were terminated.

  1. Have consistent, reasonable policies in place. Mr. Johnson recommends having reasonable severance policies with stated dollar figures in place, to avoid getting mired in negotiations.

I question this recommendation and the former one.  Since the facts and evidence supporting sexual harassment claims will vary, a template approach to these claims seems unrealistic and unworkable.  For example, was the alleged conduct based on oral statements or documents, such as emails or texts, or both?  Did the alleged improper conduct include touching?   It may be a company’s interest to promote such settlement negotiations.

  1. Review policies from time to time.

Employers generally do not review their policies on a regular basis.





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