In the past 15 years, the number of retaliation claims against American employers has skyrocketed as workers tack them on to charges of harassment or discrimination. These claims are an expensive proposition for any company to defend against. In this article, Anthony J. Oncidi and Adam Freed of the Proskauer Rose L.L.P. law firm offer tips on how to avoid and manage retaliation claims.

Retaliation claims are becoming an ever-growing threat to America's employers. Anti-discrimination laws at the national, regional, and local levels forbid retaliation against individuals who have filed discrimination or harassment charges, participated in court or administrative agency proceedings concerning such charges, or opposed practices made unlawful under antidiscrimination statutes.

In the past decade and a half, the number of retaliation claims has skyrocketed. According to the U.S. Equal Employment Opportunity Commission, the number of federal retaliation claims rose approximately 105% between 1997 and 2011. In 1997, 80,680 charges were filed with the EEOC, of which 18,198 were retaliation claims; by 2011, out of 99,947 retaliation charges filed that year with the EEOC, the number of retaliation claims had risen to 37,334 — amounting to 37.4% of the EEOC's caseload and the most common of all employment-related claims.

It has become common practice for employees to tack on a retaliation charge to their harassment or discrimination charges. Unfortunately for employers, it is often these retaliation claims that stick and result in liability — even where the underlying discrimination claim is rejected. It's for that reason that a retaliation claim should be considered the “barbed tail” of a discrimination or harassment complaint.

Retaliation claims are an expensive proposition for any company, particularly when considering that a jury may award punitive damages against the company if the jurors find that agents for the company — such as managers or supervisors — acted with malice or reckless indifference to the employee and his or her rights. Worse still, the EEOC actually encourages jurors to award punitive damages against companies for retaliation claims, stating “proven retaliation frequently constitutes a practice undertaken with 'malice or with reckless indifference to the federally protected rights of an aggrieved individual,' therefore, punitive damages often will be appropriate in retaliation claims.” Between 1997 and 2011, monetary benefits from EEOC retaliation claims rose from $41.7 million to $147.3 million.

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This article is intended for the Business Insurance risk manager reader who wants to understand what should and should not be done in order to prevent retaliation claims and minimize the costly exposure that can result from such claims.

Tips for avoiding and managing retaliation claims

• Implement an anti-retaliation policy.
  

  Work with your human resources department to create an airtight anti-retaliation policy to be included in the company handbook distributed to employees upon the commencement of their employment. The following is an example of such a policy:
  

  "Employees with questions or concerns about any type of discrimination in the workplace are encouraged to bring these issues to the attention of their immediate supervisor or the human resources department. Employees may raise concerns and make reports without fear of reprisal. Anyone found to be engaging in any type of discrimination, harassment or unlawful retaliation will be subject to disciplinary action, up to and including termination of employment."

• Resist the temptation to "get even."
  

  It is virtually inevitable that an employee's accusation about a manager, especially when specious, will bring increased stress to their working relationship. Nevertheless, it is important that the manager not lash out or treat the aggrieved employee any differently because of the complaint. While it's fine for a manager to testify (whether in a deposition or at trial) that he or she was bothered by the employee's complaint, the manager also needs to be able to truthfully and accurately testify that he or she did not take any adverse action against the employee as a result.

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• Avoid over-documentation.
  

  Even a manager who avoids taking any adverse action against an aggrieved employee is not out of the woods just yet. The manager may be tempted to write or say a thoughtless statement (in emails, instant messages, notes or verbally) that could be discovered by the employee's attorneys and become a "smoking gun" demonstrating the supervisor's animus towards the employee. Such statements (unless made to the company's attorneys) are not confidential and can be devastating during a trial, significantly drive up the settlement value of a case, or even result in a defamation claim against the company. Thus, avoid saying or writing that the employee is a "troublemaker" or that you want to "get rid of" the employee, or making other potentially damaging remarks.
  
  

  That said, documentation can often be important, and the company should continue to follow best practices with respect to putting certain things in writing, such as employee warnings, discipline and performance evaluations. What is important is that you do not "build a file" on the aggrieved employee or document the employee in a way that is different than other employees. Supervisors need to be consistent in the manner in which they treat their employees.

• Make reasoned, thoughtful decisions after consulting the company's human resources and legal departments.
  

  While an employee who complains may be protected from retaliation, the employee does not become invincible and is still subject to the same discipline and adverse job actions as his or her co-workers. Nevertheless, because of the heightened risk that follows from taking an adverse action against an employee who has complained, any adverse action should be independently reviewed by HR and the company's legal department and done in conjunction with at least one other manager who is removed from the dispute and has no motive to retaliate against the employee. Also, bear in mind that the adverse action need not be an action relating to the terms of employment, but can include any materially adverse action (related to employment or otherwise), such that it would dissuade a reasonable worker from making or supporting a charge of discrimination.

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• Don't target third parties.
  

  Last year, the U.S. Supreme Court prohibited retaliation against a complaining employee in the form of reprisals against a third party, such as a spouse, family member or fiancée, who is closely associated with the employee who engaged in protected activity. The Supreme Court held that such actions are illegal under Title VII's anti-retaliation provision and may be enforced in a civil action brought by the third-party victim. Thus, avoid making rash decisions that could affect not only the complaining employee but also third parties closely associated with the complainant.

• Proceed with actions that were planned prior to the employee's complaint.
  

  An employer need not interrupt a previously planned job action such as a transfer or termination merely because the employee lodges a discrimination or harassment complaint. However, be aware that the mere appearance that the complaint caused the adverse job action may nevertheless engender a retaliation claim. The longer the time that passes between an employee's complaint and an adverse action, the less likely it is for a finder of fact to determine that there was a causal connection between the two occurrences.

• Continue to hold the employee to the same standards of performance as before the complaint.
  

  Managing an employee who has made a complaint may seem treacherous, but you should avoid any temptation to artificially inflate the employee's reviews or shield him or her from discipline, which may make other employees feel as though the aggrieved employee is being rewarded for complaining. Rather, continue business as usual. Praise the employee if praise is deserved. In fact, such praise, where merited, can be useful evidence to counter a future claim of retaliation. On the other hand, discipline the employee if his or her behavior warrants discipline (after consulting with HR and the legal department, as stated above).

  Consider also that it is frequently the case that the alleged whistle-blower will commit an act in the future that will actually justify an adverse action. Don't let employees take advantage of you because they feel their complaints have made them immune. Continue to take proportionate, well-documented and appropriate adverse job actions when necessary.

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• Do not make the employee's life miserable in the hope that he or she will quit.
  

  Some employers may be tempted to try to drive the alleged whistle-blower out by making his or her working life intolerable, thereby avoiding the need to take a retaliatory adverse action. However, the courts have picked up on this tactic and labeled it "constructive discharge." An employer who becomes hypervigilant toward an employee and causes the individual to resign will be subject to the same liability as if the employer actually terminated the employee. Thus, avoid any sort of bullying or public humiliation that creates an abusive working environment. Note that this does not mean avoiding the manager's duty to provide the employee with clear expectations and guidelines and hold the employee to such standards.

• Resist retaliating simply because the complaint has no merit.
  

  The tips stated above apply with equal force to a manager who has been targeted with a completely unfounded accusation. Often, laws protect aggrieved employees who complain in "good faith" even if it turns out their complaints are meritless. Co-workers who act as witnesses for a complaining employee are also protected.

  You can and should be able to navigate through workplace complaints without incurring additional retaliation claims if you consult HR and your company's legal department and follow these tips.

Anthony J. Oncidi is a partner in and the chair of the labor and employment department in the Los Angeles office of the law firm of Proskauer Rose L.L.P. He can be reached at 310.284.5690 or aoncidi@proskauer.com.

Adam Freed is an associate in labor and employment department in the Los Angeles office of the law firm of Proskauer Rose L.L.P. He can be reached at 310.284.5652 or afreed@proskauer.com.