On September 29, 2004, Governor Arnold Schwarzenegger signed Assembly Bill 1825 into law, mandating immediate and continued on-the-job sexual harassment prevention training for more than 1.7 million California supervisors. Among the most far-reaching legislation of its kind, AB 1825 requires companies with at least 50 employees or independent contractors doing business in California to provide at least two hours of interactive anti-harassment training and education to all supervisors. Regulations concerning the bill's provisions are not yet finalized, but employers should be moving forward with AB 1825's requirements now in anticipation of regulatory deadlines.
Supervisors employed as of July 1, 2005, must receive sexual harassment prevention training by January 1, 2006, unless they were trained in 2003 or 2004. Supervisors employed after July 1, 2005, must receive training within six months of when they were hired. After this initial round of training, all supervisory personnel must be trained at least once every two years.
By this time next year, all supervisors at California companies with 50 or more employees should be trained in how to better spot and prevent sexual harassment... For companies seeking to avoid ugly, stressful and costly litigation over sexual harassment, it makes sense for everyone to know that a process exists to address it.
San Diego Union-Tribune, 1/16/05
California Assembly Member Sarah Reyes, AB 1825's author, noted that sexual harassment is the No. 1 complaint filed with the California Department of Fair Employment and Housing (DFEH). In fact, 4,231 sexual harassment cases were filed with the DFEH during the 2002-03 fiscal year alone.
The impact of sexual harassment on organizations is significant, resulting in absenteeism, low productivity, and high employee turnover. According to a survey conducted by Working Woman magazine, sexual harassment costs the average Fortune 500 company $6.7 million per year, or approximately $282.53 per employee. These losses do not account for indirect, hard-to-measure expenses such as lost productivity, employee morale, and tarnished public image.
Sexual harassment training is important so that employees are educated in terms of their duty to report any sexual harassment and thereby ensure that the employer has an opportunity to investigate and undertake effective remedial action before a suit is filed. Monitoring the conduct of supervisory personnel is important so that corrective action can be taken promptly in the event of inappropriate conduct before a complaint is filed by a victim.
Risk Management, 2/01/05
Furthermore, several recent court decisions in California highlight the increasing responsibility of organizations for preventing sexual harassment:
- A major corporation was required to pay $2 million in punitive damages for failing to prevent and correct sexual harassment.
- A jury handed down a $2.95 million verdict against a major university for gender discrimination towards a doctor.
- The California Supreme Court ruled that employers are strictly liable for the misconduct of their supervisors.
AB 1825 applies to any company operating in California with 50 or more employees—regardless of where its home office is based, any company that regularly receives the services of 50 or more independent contractors, all state entities, including any political or civil subdivision of the state, and all cities.
All supervisors who direct the daily duties of employees are required to undergo training that provides information and guidance regarding federal and California sexual harassment statutes, remedies available to victims of sexual harassment, and practical examples of how to prevent harassment, discrimination, and retaliation. The new law outlines an aggressive timeline for training supervisors and mandates that employees complete required training once every two years after the initial round of training.
“Most legally sophisticated companies provide [sexual harassment] training to all supervisory and non-supervisory employees. That's the smart thing for small and large employers to do to minimize their legal exposure to [sexual harassment] claims.”
Hartford Business Journal, 7/23/01
The new requirements make California's training obligations among the strictest in the nation, requiring that material be presented by trainers or educators with "knowledge and expertise" in the prevention of harassment, discrimination, and retaliation. Because "classroom or other effective interactive training" must be used for the program format, many businesses will have difficulty providing the training on their own. Though on-line training may be an accepted teaching method upon finalization of the regulations, classroom training will definitely meet the requirements of the regulation today.
To help prevent sexual harassment incidents and to determine how prepared they are to meet the new training requirements, California employers should first ask themselves the following questions:
- When was the last time our supervisors underwent training?
- When was the last time our general staff underwent training?
- Do we have the appropriate internal resources to perform the necessary training?
- Are our anti-harassment and anti-discrimination policies up-to-date?
- Have we effectively communicated the company's policies and procedures and consistently enforced them?
AB 1825 only sets the "minimum threshold" for providing sexual harassment training. While this training can be limited to sexual harassment, discrimination, and retaliation, organizations should implement training to help prevent all forms of discrimination and harassment, including behavior based on race, age, national origin, and religion.
Given the dramatic increase in the frequency of non-sexual harassment claims over the past three years, companies should consider training all employees, not just supervisors. In addition, broad-based training of an organization's workforce helps prevent litigation and may be one component of a successful defense.
The Risk Consulting Practice at Marsh has developed a program to provide the training required by AB 1825 and can tailor this program to the individual needs and policies of each employer. For more information about how Marsh can help you respond to questions on employment issues in California, please contact us.
