Last month a new legal duty on businesses to take reasonable steps to prevent sexual harassment of staff came into effect.
Coinciding with the publicising of the allegations of rape and sexual harassment by the late Mohamed Al Fayed whilst he was the owner of Harrods, the issue of the obligations on employers are centre stage.
Understandably, the allegations against Mohamed Al Fayad have shocked the fashion industry. Whilst Harrods is under different ownership now, it remains vicariously liable for what the lawyers in the case described as a “monster enabled by a system that pervaded Harrods”.
The revelations follow a string of allegations against senior figures in the industry including Philip Green (former Arcadia owner) and Ray Kelvin (founder of Ted Baker), both of whom denied the allegations. These have been followed by allegations against senior staff at ASOS which launched an internal investigation in 2021 following a series on anonymous posts on Instagram.
More recently, the news broke that former chief executive of Abercrombie and Fitch will face criminal charges for sexually assaulting and trafficking male models at events around the world. Separately Peter Nygard, founder of one of Canada’s largest clothing brands, has been sentenced to 11 years in prison for four counts of sexual assault of women and a girl in Toronto.
Whilst some progress has been made within the industry to stamp out unacceptable behaviour on the back of the #Metoo movement which started in 2017, and certainly more women have been encouraged to speak out, there appears to remain a lack of consistency and determination within certain corners of the industry to take necessary action.
The new duty
The new duty obliges businesses to take reasonable steps to prevent sexual harassment of staff and came into force on 26 October 2024.
Significantly, the new duty holds businesses accountable not only for addressing sexual harassment after it occurs, but also for proactively taking steps to mitigate the risk of such conduct occurring in the first place.
What is sexual harassment?
Sexual harassment is widely defined and covers situations where a person engages in unwanted behaviour of a sexual nature, whether verbal, non-verbal or physical, that creates an intimidating, hostile, degrading, humiliating or offensive working environment. Examples include:
- making sexual remarks about someone’s body, clothing or appearance;
- asking questions about someone’s sex life;
- telling sexually offensive jokes, making sexual comments or jokes about someone’s sexual orientation or gender reassignment;
- displaying or sharing pornographic or sexual images, or other sexual content;
- touching someone against their will, for example, hugging them; and
- sexual assault or rape.
Reasonable steps
When deciding if a step is “reasonable” to prevent sexual harassment in line with the new duty, relevant factors include:
- the size and resources of the business, the nature of the working environment and the risks present in that workplace;
- the nature of any contact with third parties (such as customers, journalists and photographers), frequency and applicable environment;
- the likely effect of taking a particular step and whether an alternative step could be more effective; and
- the time, cost and potential disruption of taking a particular step, weighed against the benefit it could achieve.
Compliance with the duty is likely to start with businesses carrying out a risk assessment and devising an action plan, taking into account potential risk areas for staff members, including any history of sexual harassment. This means that businesses will be forced to revisit any skeletons in their closet.
The action plan is likely to involve a myriad of different steps, but inevitably there will be a focus on:
- Developing an effective policy and ensuring staff engagement;
- Using a reporting system and setting out a clear complaint handling process; and
- Conducting effective training, as opposed to generic online training which may not have the desired impact.
As noted above, businesses must keep their approach to the new duty under review, and in particular demonstrate learning from any new sexual harassment complaints which come to light.
Who is protected by the new duty?
The new duty is designed to safeguard not only employees but also workers (such as consultants) engaged by the business, and to prevent them from harassment by other staff members as well as third parties with whom they may come into contact during the performance of their role.
For example, consideration would need to be given to safeguarding a model who may be exposed to sexual harassment by a third-party photographer at a shoot, or a salesperson receiving unwanted attention by a customer who may be subject to inappropriate comments at an industry event.
Consequences of non-compliance
Non-compliance with the new duty could lead to any award of damages in applicable cases being increased by up to 25%. Businesses may also be subjected to new regulatory powers to carry out investigations and take enforcement action, which may include binding commitments to prevent future unlawful acts.
Most damaging, however, is that non-compliance is likely to have a negative impact on employee morale and retention, make businesses more susceptible to sexual harassment claims being brought in the future and lead to adverse publicity and reputational damage.
Further changes on the horizon
The Government is already consulting on enhancing the duty by obliging employers to take ‘all’ reasonable steps to prevent sexual harassment, as opposed to merely reasonable steps, which means that the burden businesses face in this context is likely to increase significantly over the coming years. It is not an option for businesses to bury their heads in the sand.
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