Firing Both Parties Involved in the Sexual Harassment Complaint is Not a Solution

By: Laura C. Hess

A recent California court decision, Mendoza v. Western Medical Center Santa Ana, (2014) 222 Cal.App.4th 1334, highlights the mistakes an employer can make when handling a sexual harassment complaint.

Employers always need to do a good faith investigation, even if the allegations appear to be "he said/she said." When employers terminate a long-term, well-performing employee after he or she has complained about sexual harassment, they run the risk of a being sued for wrongful termination.

In Mendoza, the plaintiff, a male nurse, worked for a hospital for 20 years. He had an excellent work history. Plaintiff alleged he was sexually harassed by a newly hired male supervisor. Both men are gay.

The supervisor claimed plaintiff initiated sexual banter with him, that plaintiff consented to the conduct, and moreover that the supervisor was a reluctant participant to the sexually charged conduct. The hospital decided to terminate both employees for engaging in inappropriate and unprofessional behavior.

Plaintiff sued on the grounds that California law prohibits terminating an employee because he made a complaint about sexual harassment. ( Gov. Code § 12940)

At trial, the jury found in favor of the plaintiff, awarding him over $283,000. The appellate court overturned the verdict and ordered a new trial because of errors in the jury instructions.

In doing so, the court pointed out, "The lack of a rigorous investigation by defendants is evidence suggesting that defendants did not value the discovery of the truth so much as a way to clean up the mess that was uncovered when Mendoza made his complaint." It pointed out several flaws in the investigation, such as interviewing the complainant and the accused at the same time rather than separately, not interviewing co-workers, and not using an impartial, trained investigator.

The court noted that a "more thorough investigation might have disclosed additional character and credibility evidence for defendants to consider before making their decision." In a sharply worded footnote, the court said that just because the two parties offer conflicting versions of what happened, this does not relieve the employer of the responsibility to make a good faith decision.

During argument, the employer's lawyer asked what employers must do when two employees provide conflicting accounts. "Our answer is simple," said the court:

"[E]mployers should conduct a thorough investigation and make a good faith decision based on the results of the investigation. Here, the jury found this did not occur. Hopefully, this opinion will disabuse employers of the notion that liability (or a jury trial) can be avoided by simply firing every employee involved in the dispute."

The law requires employers to conduct a prompt, good faith, thorough, and neutral investigation. Mendoza highlights the fact that it is not a "solution" for employers to just fire everyone, rather than try to determine what really happened.

Laura C. Hess is a Partner with Kring & Chung, LLP's Irvine, CA office. She can be reached at (949) 261-7700 or lhess@kringandchung.com