Confidential settlements in employment cases: Poof, as if nothing happened

The vast majority of discrimination and sexual harassment complaints are settled or otherwise disposed of before they even come close to going to trial. The typical settlement involves monetary compensation to the complainant, without any admission of wrongdoing by the employer or alleged wrongdoer(s), and with all parties obliged to keep the matter confidential.

This subject has entered the news cycle because of allegations that GOP presidential hopeful Herman Cain had sexually harassed two female employees in the 1990s. Both women accepted settlements and left the organization.

Pursuant to the Cain story, I was asked by CNN’s Emanuella Grinberg to comment about confidential settlements in sexual harassment cases, and I expressed my concerns about the downsides of this common practice (full article here):

But there are greater collateral effects of concealing real instances of harassment, said David Yamada, Suffolk University law professor and director of the New Workplace Institute in Boston.

“Employers become complicit in shielding themselves and the individual harassers — many of whom are management level or supervisors — from genuine accountability,” he said. “If the confidential settlement does not result in any concrete discipline or discharge of the harasser, there’s a decent chance it will happen again to another employee.”

Weighing costs and benefits

Don’t get me wrong: Settling a valid claim of discrimination or harassment often is better for employee and employer alike. I also have no desire to subject targets of sexual harassment or any other kind of workplace mistreatment to long, stressful, drawn-out legal proceedings. And I know that some employers may settle claims they do not believe are meritorious largely because it will cost too much to lodge a defense.

However, bad employers often have a long track record of settling legitimate claims very quietly. In these organizations, for example, if a serial harasser has enough power or influence, he may well be able to keep his position despite his misconduct. This means, of course, that the idea of accountability is tossed aside, and that more employees are likely to be mistreated in the future.


Related post: Quiet cover-ups

5 responses

  1. I decided after identifying my workplace difficulties as bullying to expend my efforts in shining a light on the subject. I tried every avenue I could think of within the organization…alternative dispute resolution, union involvement, respectful workplace complaint (informal and formal), whistleblower mechanism, appeal to the Minister of Labour, and finally resignation. I decided against legal action (too expensive and traumatic) and am still advocating with the ex-employer (though they do not respond to my communications).

    There has been legislation introduced where I live, but I am not confident there is sufficient political will to enforce it (just as there was insufficient will to enforce the Respectful Workplace policy and Workplace Safety and Health Act provisions that I believe applied in my situation. I retain the right and responsibility to tell the truth anywhere and to anyone (with supporting documentation) who I feel would be receptive…which does not include the employer, the union, or the government.

    I will not be silenced, and have found MANY targets with whom I can share my story and have a positive effect. My work history and talents lie in honest communication with individuals experiencing crises and mental health challenges….so the only thing that has really changed is that I no longer have a toxic workplace- or the income I derived from it. But I still get to do work I love and make a difference in people’s lives.

  2. This paragraph, “However, bad employers often have a long track record of settling legitimate claims very quietly. In these organizations, for example, if a serial harasser has enough power or influence, he may well be able to keep his position despite his misconduct. This means, of course, that the idea of accountability is tossed aside, and that more employees are likely to be mistreated in the future.” acknowledges the long “hidden” workplace phenomenon I call “workplace conspiracy”.

    In criminal law there are penalties for collusion and planning to commit crimes by two or more individuals. However, in employment law to my knowledge their is no specific corresponding penalty. Here’s an example,

    “The bad employers”
    The owner’s good buddy is the plant manager.

    “Serial harasser”
    The good buddy manager who can’t keep his hands off the female employees.

    “Enough power or influence”
    The harassing manager operates in a “comfort zone” of security in the knowledge the “bad employer” has his back.

    “Position despite his misconduct”
    When the female(s) complains to the HR manager (who is also a good buddy of both the serial manager and the owner) the investigation process an uphill climb for the “victims” of the sexual harassment.

    “Accountability is tossed aside”
    The “investigation’ runs its course and the “victims” complaints are found to be “groundless” or the manager receives the classic “slap on the wrist”. The “bad employer” sends out emails reaffirming the company’s “commitment” providing info about workplace harassment.

    Over time the accusing female(s) eventually and mysteriously get transferred or laid off while the “serial harasser” continues his career with promotions benefits. Since MOST employees have little or knowledge of their rights BEFORE seeking and ACCEPTING employment they continue to be fair game for uneven “settlements” that allow “bad employers” to remain “…complicit in shielding themselves and the individual harassers…”

  3. In my case the jury found the Department of Corrections and the Plaintiff guilty, but of course there was an appeal. I went back to work and the harassment started again with the plaintiff’s cronies. I started the steps for a second law suit but they requested a settlement. I agreed to the settlement because I could not continue to put my family and myself through the drama again. The only confidential claus I had was the cash amount. I refused to sign any other confidential clause. It shocked me when they told the Sacramento Bee the amount of settlement. They are all there still which goes back to the theory, “No one is held accountable for bullying in the work place!”

  4. I left the company that I worked for 14 1/2 years. Under duress and weakness, I sighned a confidentiailty agreement
    the company offered even though they were going to get rid of me no matter what. The day I got back from vacation, I was called to H.R. and was told that before I left I violated a safety guideline, The company lied and the final paperwork I sighned not admitting to their ridiculous lie, they sent me home while they investigated the complaint, I recieved a letter from the Labor Board dated prior to when I even got back from vacation regarding unemployment from the paperwork the company had already submitted, there was no investigation the day I got back they had already terminated mme . I wish I could request my confideliaty form could be thrown out because clearly they lied.

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