Is this your problem?

One of my staff has accused another employee of sexual harassment...

Not only does sexual harassment make the victim's life a misery, it can land your business in very hot water unless you act quickly and decisively.

The effects of sexual harassment include reduced productivity, absenteeism, damage to your reputation and the resignation of valued employees. Employers have a legal duty of care to their employees. They are liable for discrimination and harassment, and firms can end up in an employment tribunal, facing unlimited claims for compensation.

Sexual harassment can be verbal (such as propositions or lewd remarks), non-verbal (including displaying or emailing pornographic images) or physical (ranging from touching or brushing against someone through to assault). Such attention is, naturally, not welcomed by the victim.

While extreme sexual harassment is obvious, one person's idea of a joke might be harassment in the eyes of another. According to employment experts Acas, the key to whether behaviour is illegal is if it is "unwanted conduct that violates people's dignity or creates an intimidating, hostile, degrading, humiliating or offensive environment".

Once you have received a complaint, it counts as a grievance under statutory disciplinary and grievance procedure law, so treat it as a formal matter from the start. Speak to both parties privately; make notes of conversations and give each person a fair hearing. Let both parties know that you're taking the matter seriously.

If necessary, speak to other members of staff (in privacy) if you need to establish what happened. Listen to facts, not opinion. Most employees don't complain unless they are genuinely aggrieved.

If your investigations reveal that harassment has taken place, act quickly and convincingly. Speak to the guilty party and tell them why their behaviour is unacceptable. Tell them that if it doesn't stop immediately you will take official action. Some employees simply don't realise they are causing offence and will mend their ways straight away.

If this doesn't work, embark on the formal three-step disciplinary procedure, following closely any additional policies your firm has. The basic steps of the process are: the manager makes a statement of what the problem is; a meeting is held with the guilty party; and they have the right to appeal.

Depending on how serious the harassment is, the penalty could range from in-house corrective training to issuing a written warning. If the harassment is extreme or violent, you are likely to consider dismissal, of course.

Hold a meeting with the victim and reassure them that the matter has been dealt with adequately.

Take action to reduce the risk of the problem happening again. If you don't already have one, draw up a policy that defines clearly what sexual harassment is and what you (guided by the law) consider acceptable staff behaviour to be.

Such a policy doesn't have to be elaborate. State that you take the issue of harassment seriously; that you will investigate all complaints fully and fairly; and outline how you will treat it under your firm's disciplinary procedures. Make sure all company representatives understand your policy.

In cases of sexual harassment, the financial risks to firms are considerable. If it begins to look likely that the matter is heading for court, seek legal representation as early as you can.

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