📋 Overview

You've received a demand letter alleging workplace harassment. Under California's FEHA, employers can be held liable for harassment by supervisors, and may be liable for harassment by co-workers if they knew or should have known and failed to take corrective action. This guide helps you evaluate the claim and respond appropriately.

⚠ Strict Liability Risk

Employers are strictly liable for harassment by supervisors. For co-worker harassment, liability attaches if employer knew and failed to act.

🕒 Investigation Required

California law requires prompt, thorough investigation of all harassment complaints. Document your investigation process.

💰 Avoidable Liability

The Faragher-Ellerth defense may limit liability if you had anti-harassment policies and the employee unreasonably failed to use them.

Types of Harassment Claims

  • Quid Pro Quo - Supervisor conditions job benefits on sexual favors or submission to harassment
  • Hostile Work Environment - Severe or pervasive conduct that alters working conditions
  • Sexual Harassment - Unwelcome sexual conduct, comments, or advances
  • Non-Sexual Harassment - Harassment based on race, religion, age, disability, or other protected characteristics
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🔍 Evaluate the Claim

Before responding, investigate the allegations thoroughly. Harassment claims require showing conduct was severe or pervasive enough to create an abusive working environment.

Risk Assessment Matrix

Harassment Type Potential Damages Risk Level
Quid pro quo by supervisor Strict liability + unlimited emotional distress + punitives HIGH
Hostile environment (severe) Emotional distress + lost wages + punitives HIGH
Co-worker harassment (known) Emotional distress + lost wages HIGH
Single incident (non-physical) May not meet severity threshold MEDIUM
Investigated and corrected May have affirmative defense LOW

📄 Policy Review

  • Anti-harassment policy in place
  • Policy distributed to all employees
  • Complaint procedure clearly stated
  • SB 1343 training completed

📝 Investigation Records

  • Prior complaints from this employee
  • Complaints against alleged harasser
  • Witness statements and interviews
  • Corrective actions taken

⚠ Investigate Immediately

Upon receiving a harassment complaint, you must conduct a prompt, thorough, and impartial investigation. Document every step. Failure to investigate is itself evidence of negligence and can defeat your affirmative defenses.

🛡 Your Defenses

California recognizes several defenses to harassment claims. Your best protection is having proper policies and responding appropriately to complaints.

Avoidable Consequences / Faragher-Ellerth Defense

If you maintained a clear anti-harassment policy with complaint procedures, and the employee unreasonably failed to use them to avoid harm, you may limit or avoid liability for supervisor harassment (not quid pro quo).

When to use: You had policies in place and the employee never complained through proper channels.

Prompt Corrective Action

For co-worker harassment, employers are liable only if they knew or should have known and failed to take immediate and appropriate corrective action. If you investigated promptly and took effective remedial measures, this is a defense.

When to use: You investigated the complaint and took action that stopped the harassment.

Conduct Not Severe or Pervasive

To be actionable, harassment must be severe or pervasive enough to create an abusive work environment. Isolated, minor incidents may not meet this standard.

When to use: Single incident of non-physical conduct or occasional mild comments.

Not Based on Protected Characteristic

FEHA prohibits harassment based on protected characteristics. General workplace bullying or personality conflicts, while unpleasant, may not be unlawful harassment.

When to use: Conduct was unrelated to any protected characteristic.

🚨 Defenses That Won't Work

  • "It was just joking around" - Intent doesn't matter, impact does
  • "Everyone talks like that here" - Workplace culture is not a defense
  • "The employee was too sensitive" - Standard is reasonable person in their position
  • "We didn't know" - You have a duty to know and prevent harassment

Response Options

Based on your investigation, choose the appropriate response strategy.

Mediation

Offer mediation with a neutral third party to resolve concerns without litigation.

  • Confidential process
  • Preserves relationship
  • Cost effective

Formal Denial

If investigation shows allegations are unfounded, provide a formal response with supporting documentation.

  • Creates record
  • Preserves defenses
  • May deter litigation

Settlement

If the claim has merit or litigation costs would be substantial, consider a confidential settlement.

  • Avoids trial risk
  • Confidential
  • Closure for all parties

📊 Cost-Benefit Analysis: Settlement vs. Litigation

Example: Hostile work environment claim

Emotional distress damages$50,000-$500,000
Lost wages (if constructive discharge)$75,000
Punitive damages$100,000+
Employee attorney fees$150,000+
Your defense costs$100,000+
MAX EXPOSURE IF YOU LOSE$500,000+

💡 Training Matters

California law (SB 1343) requires all employers with 5+ employees to provide sexual harassment prevention training. Failure to train can be evidence of negligence and undermines your defenses. Ensure compliance.

📝 Sample Responses

Copy and customize these response templates for your situation.

Acknowledgment & Investigation
We have received your demand letter dated [DATE] alleging harassment in the workplace. We take all harassment allegations extremely seriously and are committed to maintaining a workplace free from harassment. We have initiated a thorough investigation into your allegations. As part of this investigation, we would appreciate your cooperation in providing: (1) Specific dates, times, and locations of the alleged incidents (2) Names of any witnesses (3) Any documentation (emails, texts, photos) supporting your allegations We will complete our investigation within [30] days and provide you with our findings and any corrective actions taken.
Response After Investigation - Corrective Action Taken
We have completed our investigation into the harassment allegations raised in your demand letter. We appreciate your patience during this process. Based on our investigation, we have taken the following corrective actions: - [Describe actions taken - discipline, training, separation of parties, policy updates, etc.] We are committed to ensuring a harassment-free workplace. If you experience any further concerns, please report them immediately to [HR contact]. We believe these corrective measures address your concerns. If you would like to discuss this matter further, please contact us to schedule a meeting.
Denial - Allegations Not Substantiated
We have completed a thorough investigation into the allegations raised in your demand letter dated [DATE]. After interviewing relevant witnesses and reviewing all available documentation, we were unable to substantiate the allegations of harassment. Specifically: - [Briefly summarize investigation findings] Our company maintains a clear anti-harassment policy and takes all complaints seriously. We found no evidence that this policy was violated. We remain committed to a respectful workplace. If you have additional information that was not considered in our investigation, please provide it for our review.

🚀 Next Steps

What to do after receiving a harassment claim demand letter.

Step 1: Don't Retaliate

Any adverse action against the complainant can create a separate retaliation claim, even if the harassment claim fails.

Step 2: Investigate Promptly

Begin your investigation immediately. Document every step, interview, and finding.

Step 3: Separate if Needed

If appropriate, temporarily separate the complainant from the alleged harasser during investigation.

Step 4: Take Corrective Action

If harassment is confirmed, take prompt and effective corrective action proportional to the offense.

If They File with CRD

  • Position Statement - You may submit a written response to the allegations
  • Mediation - CRD offers free mediation services
  • Investigation - CRD may investigate or issue immediate right-to-sue

If They File a Lawsuit

  • Answer within 30 days - File your response to avoid default
  • Discovery - Expect extensive document production and depositions
  • Summary Judgment - If no triable issues exist, you may seek dismissal

Get Professional Help

Harassment claims require careful handling. Get a professional response letter drafted on attorney letterhead.

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