Sex in the executive suite: A case study

By Julie A Moore, Esquire
Reprinted with permission of the New Hampshire Business Review, Vol. 20, No. 23, Oct 23-Nov 5, 1998

There has been a lot of talk, analysis, and controversy swirling around the relationship of the world’s most powerful man and a former intern who was deeply infatuated with him. The talk show hosts have engaged in endless lurid speculation about the President’s political fate. Psychologists have offered guidance about how to tell our children of the affair. Very little attention, however, has focused on what their relationship means in terms of employer-employee dynamics.

The issue is fraternization in the workplace. It has crippled the President. It ruined the career of Air Force Lieutenant Kelly Flinn. Closer to home, it was responsible for ousting Massachusetts-based Staples Inc.’s president Martin Hanaka. For obvious reasons, affairs between employees, particularly where there is a stark imbalance in power, are generally proscribed.

The reality is that with the influx of women in the workforce, it is increasingly common for men and women who work for the same employer to develop a mutual attraction and become romantically involved. It is implausible to believe that amorous relationships will not develop on the job. The issue, then, is how should employers respond and what issues should they consider in forming their policies on this topic.

Rationale for Having a Policy

The legal and business implications surrounding workplace relationships, both ongoing and former ones, are tremendous. Sexual harassment allegations, wrongful termination suits, and workplace violence are all possible legal consequences. Workplace romances are inherently fraught with problems. In addition to creating liability, they can be the source of significant morale problems, bring productivity to a standstill, and fuel the fire for morality judgments. They can provide a mechanism for the improper sharing of confidential information and create conflicts of interest. They can cause the participants and their confidants to engage in a pattern of deceit and lying to cover-up the existence of the affair. They can ruin reputations and careers. Workers involved in such relationships, particularly in adulterous ones, often spend much time with their liaisons at the expense of getting the job at hand done. Awkward, and often untenable, situations can develop both while the relationships are ongoing and when they end.

The threat of a sexual harassment lawsuit, particularly, has helped accelerate the trend toward non-fraternization rules in the workplace. It is illegal under state and federal law for employees to engage in any behavior that creates a hostile and abusive work environment, including conditioning job benefits on sexual favors. Managers can automatically bind their employers for engaging in such misconduct. Flirting and sex-tinged banter can be acceptable in the workplace so long as they are "welcome" or consensual. If (when) the relationship ends, however, what was once welcome is usually completely off limits.

As the President’s situation has unfortunately demonstrated, once litigation ensues, the "discovery phase" before trial can result in deep probing for information that may -- in any way -- be relevant to the allegations in the lawsuit. The time and expense involved as well as the emotional toll for employers and managers who are sued often are immeasurable. Jilted lovers can be steadfast in their belief that they have been wronged and, often, the employer is the target of their attack

New Hampshire Court Cases

Several New Hampshire employers have learned about workplace fraternization the hard way, according to court documents. A Concord law firm was itself embroiled in litigation after an adulterous affair between a legal secretary and the firm’s administrator ended. Once the affair was known, the administrator submitted his resignation. After that, the secretary complained that she was harassed by members of the firm who blamed her for his departure. The secretary was believed to be responsible for prank phone calls, bomb scares, and death threats. After consulting workplace violence experts, the firm fired the secretary. The secretary then sued.

In another case, a large manufacturing company in Derry found itself sued for sexual harassment after a drill operator’s relationship with her supervisor went awry. The two were involved in a consensual relationship, which included living together for a time. The woman attempted to end the relationship several times but claims she was pressured to resume it by her supervisor’s abusive and threatening behavior at and outside of work. She consulted with the human relations office who intervened on her behalf by disciplining the alleged harasser and allowing her to switch positions. The situation became more complicated when the woman then began a romantic relationship with another male employee, resulting in physical hostility between the two men. The company undertook numerous efforts to ameliorate and remedy the situation but, nevertheless, found itself defending in court against claims the woman brought for sexual harassment.

Favoritism

Claims are often brought by workers alleging inappropriate favoritism based upon a wide range of activities, including participation in sexual jokes, inappropriate touching, and sexually charged language. The most obvious claim for favoritism arises out of an ongoing sexual relationship where a supervisor and an employee are having an affair and the supervisor has treated his or her paramour more favorably in the conditions and terms of employment than other employees. The New Hampshire federal court has considered this specific issue and rejected a sexual discrimination claim brought by an employee who claimed to be adversely affected by a workplace romance. In that particular case, the complaining employee was a marketing representative for a national provider of home therapies and support services to long-term, chronically ill patients. She charged that her supervisor reassigned some of her more lucrative sales territory to the supervisor’s paramour in return for the paramour’s amorous affections. The court dismissed that claim, finding that workplace favoritism for the employer’s sexual partner disadvantaged both male and female co-workers that were not sexually involved with the supervisor. Accordingly, there was no discrimination.

Developing a Policy

Since neither federal nor state laws explicitly govern employers in this arena, employers have the choice as to whether or not to regulate fraternization in their workplace. Employers are free to adopt policies or guidelines for employees to follow in their social relationships at work. In so doing, they are advised to create policies that are unambiguous, clearly communicated, and uniformly applied.

In formulating a policy, employers should give consideration as to which relationships are permissible, if any, and which will not be tolerated. The particular work environment should be assessed before making such decisions. Surveying how romantic relationships have fared in the past and how any present relationships are handled is helpful in examining what policy, if any, is needed. Communicating with other employers about their experiences can often be an enlightening experience, as well. In many work settings, for example, employees dating "within rank" is acceptable while supervisors dating line employees is not. A 1998 survey conducted by the Society for Human Resource Management found that 70% of companies surveyed prohibit romantic relationships between supervisors and subordinates and 37% forbid relationships within the same department. Other employers forbid all fraternization regardless of who is involved.

Employers must decide how to enforce breaches of any policy, being careful to treat workers in a gender-neutral fashion. Always transferring the person with the lower salary grade, for instance, could result in having an adverse impact on female employees and thus may be unlawful. Any discipline should be fair and, significantly, consistent.

Consensual Relationship Agreements

In addition to implementing anti-fraternization rules, some companies have chosen to reduce to writing the status of romantic relationships between supervisors and subordinates in so-called consensual relationship agreements. For instance, a supervisor writes a letter to the subordinate that reads something like this: "I want to assure you that under no circumstances will I allow our relationship or, should it happen, the end of our relationship, to impact on your job or our working relationship." In turn, the subordinate responds, "My relationship with you is voluntary, consensual and welcome. I also understand that I am free to end this relationship at any time and, in doing so, it will not adversely impact on my job." In legal parlance, this "fixes" the relationship, and may act as a bar to a later claim making the opposite allegations.

While in theory this may be good practice, it may not be a practical solution for many employers.

Employment litigation is commonplace, and the stakes are high. Employers should give careful thought about fraternization in their workplaces and decide upon policies that fit their cultures. Problems do not go away by ignoring them. It is imperative that employers make conscious decisions about this matter and many other important personnel issues. Thereafter, policies that best serve the employers’ interests can be established and then consistently enforced. Perhaps the White House will be among those employers who see the wisdom in such human resource policy-making.

Julie A. Moore, Esquire of Employment Practices Group in North Andover, Massachusetts, specializes in risk-management, workplace training and internal investigations on sexual harassment and other employment issues. She is admitted to practice law in Massachusetts and New Hampshire. She can be reached at jmoore@employmentpg.com or 978-975-0080.