Chase sex harassment case holds lessons for employersNews added by Benefits Pro on April 29, 2014
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By Dan Cook

In a twist on typical sexual-discrimination and harassment cases, a JPMorgan Chase mortgage employee in Columbus, Ohio, was awarded damages because the court held the harassment she suffered led to lost money-making opportunities.

The case, as described by Porter Wright attorney Jamie LaPlante in the law firm’s blog, involved allegations by the employee that she “was subject to abusive and harassing behavior based on her sex by her manager and other managers. After complaining about the behavior, she alleged that Chase retaliated against her by tampering with her commissions and loan assignments and subjecting her to heightened job scrutiny and continued ridicule. She was terminated in May of 2008.”

That, however, was not the end of the story.

The woman filed a complaint with the EEOC contending she was the target of discrimination and retaliation. The agency sued the company in 2009 on her behalf.

“The EEOC alleged that Chase assigned sales calls in an unfair way to women, which directly affected their ability to earn bonuses and commissions, and permitted a hostile work environment to exist,” LaPlante said.

But Chase early on put itself at a legal disadvantage. During discovery, the EEOC said, it was found that critical information sought by the plaintiff had mysteriously disappeared.

“The EEOC successfully obtained sanctions against Chase for failing to preserve telephone skill login data records relating to the assignment of loans to mortgage consultants,” LaPlante wrote. “Chase argued that the data was purged as a result of its routine destruction of electronically stored information. The court was unsympathetic, holding that Chase had notice of the scope of the EEOC’s claims and that its failure to implement a litigation hold was “inexcusable” and the result of at least negligence, which bordered on intentional conduct.”

The case was recently settled, with the employee winning a $1.45 million award, $470,000 of which comprised punitive damages. Chase was also required to take a series of remedial measures related to its treatment of employees, maintenance of records and its process for distributing sales lead opportunities.

LaPlante said employers should take away two serious lessons from Chase’s experience:

One: “It is difficult to ensure equity in the assignment of sales leads, customers, and territories because these opportunities are not amenable to exact division and because many variables determine who is the right sales person for each opportunity. However, these assignments directly affect the ability for sales personnel to earn commissions and bonuses. The assignment of sales leads, customers, and territories should be equitable based on legitimate, nondiscriminatory criteria (prior experience with the territory or customers, skill level, product knowledge, and experience or tenure, among others). More importantly, the method of assigning sales leads, customers, and territories should be defensible and explainable if challenged, and any necessary training or advancement opportunities should be equally available to all,” she said.

Two: companies should ensure that litigation holds preserving relevant paper documents as well as electronic documents (including ceasing any regular destruction of electronic documents) are implemented as soon as litigation is anticipated. This should be at the first notice of probable litigation, i.e., at the time a litigation threat letter is received, at the time of receipt of notice that a charge of discrimination has been filed, etc. These litigation holds should be expanded as soon as the litigation’s scope or potential litigation’s scope is expanded. A failure to implement a litigation hold can: (1) turn a potentially strong case into a weak one due to lost evidence supporting your case; (2) lead to adverse inferences about lost evidence and whether the evidence would have been helpful to the opposing side; or, (3) both.”

Originally published on BenefitsPro.com
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