Are employers liable for third party harassment?

An undercover investigation in to the all-male charity event ran by the Presidents Club has raised concerns about third party harassment. The investigation led to numerous reports of female hostesses being subjected to sexual harassment by male attendees, ranging from comments of a sexual nature to groping incidents. This reportedly occurred although the event brochure contained a full-page warning guests against harassing others.

Following a number of high profile claims of sexual harassment, employers are advised to increase their understanding and awareness in this area. Sexual harassment occurs when an individual is subjected to unwanted conduct related to sex which has the purpose, or effect, of violating their dignity or creating an intimidating, hostile, degrading, humiliating or offensive environment. Harassment can also take place when there is unwanted conduct of a sexual nature which has the same purpose or creates this effect for the individual, or where there is less favourable treatment because an employee has submitted to, or rejected, conduct of a sexual nature.

The question being asked by many employers is whether they can be found liable for harassment by third parties. Previously, the Equality Act 2010 made employers liable if a third party harassed their employees, so long as the employer was aware of harassment taking place on at least two previous occasions and no reasonable steps had been taken to prevent further harassment occurring. This made employers liable for harassment by clients, customers or visitors where they had previous knowledge and failed to take preventative action.

Third party liability was removed from the Equality Act in October 2013 as the government felt it was unfair on employers to make them liable for the acts of parties they had no control over. There was also a lack of case law on the subject, suggesting there was no practical purpose for the provisions.

In January 2018, the Fawcett Society, a leading campaign group for equality and women’s rights, called for current harassment laws to be strengthened to protect women in the workplace. One of their recommendations was to reintroduce liability for third party harassment, with the knowledge requirement being reduced to a single incident of harassment.

As the Society’s recommendations came shortly before the full details of the charity dinner were exposed, there may be renewed pressure on the government to reintroduce employer third party liability. Employers continue to be vicariously liable for acts of sexual harassment carried out by their employees during the course of their employment. They can defend against liability where they can show they have taken all reasonable steps to prevent harassment occurring, so will need to evidence clear policies, training and taking formal action when complaints are raised.

Suggested Resources