Employment and crime: Sexual misconduct in the workplace

Recent scandals at Harrods and Abercrombie & Fitch have pushed the issue of sexual misconduct in the workplace back into the spotlight. Most reports of these scandals concentrated on the details of crimes allegedly committed by the powerful individuals who ran these businesses. But some of the reporting has had another focus: the alleged roles played by those who worked closely with, or for, these individuals. Inner circles of colleagues and advisers are accused of enabling the sexual misconduct to occur – whether by turning a blind eye to it, allowing it to continue with impunity or even covering it up.

So, how does the law typically clamp down on enablers of sexual misconduct? Initially, this may seem an inappropriate question. The term ‘enablers’ tends to only be used in the context of economic crime, as in the Law Society’s anti-money laundering guidance, for example. It is rarely used in the context of sexual misconduct. But the concept of enablement is a useful lens through which to explain some of the relevant provisions of employment law, professional regulation and criminal law.

Starting with employment law, it has long been the case that, where an employee has been sexually harassed at work, they can bring certain claims against their employer at an employment tribunal. If these claims are successful, depending on the circumstances, the employer can be liable not only for their own actions but also vicariously liable for the actions of their employees and third parties, such as suppliers and customers.

Last October, employment law took a further step, imposing a proactive duty on employers to take reasonable steps to prevent sexual harassment of employees in the course of their employment. If this new duty is breached, the Equality and Human Rights Commission (EHRC) can take enforcement action against employers and an employment tribunal can order an uplift in the compensation payable by them.

The accompanying guidance published by the EHRC states that, to discharge this new duty, employers are expected to anticipate scenarios when sexual harassment may take place and take action to prevent it. While the duty is couched in terms of prevention, the EHRC guidance is clear that the duty can also be breached by an employer’s failure to respond properly after sexual harassment has occurred.

Once a workplace-based incident of sexual misconduct is suspected, a specific group of professionals who may be retained as part of the ‘corporate response’ are external firms of solicitors. Their mandate may encompass an independent ‘fact-finding’ investigation, advice to the employer about their legal options, representation in a claim brought by an employee, or sometimes, all of these elements.

In recent years, the Solicitors Regulation Authority has become more vocal about the professional regulatory framework within which solicitors retained on these mandates must operate. The SRA’s warning notice on the use of non-disclosure agreements (NDAs), first published in March 2018, was most recently updated last August. The warning notice applies to all scenarios in which solicitors might negotiate NDAs, but its main focus is the type of NDA through which the solicitor’s client seeks to silence the victims of sexual misconduct (or witnesses who might be able to shed light on such misconduct).

‘While the SRA’s warning notice is confined to NDAs, it serves the broader purpose of reminding solicitors that their clients’ interests cannot be advanced at all costs’

The warning notice states that NDAs will be considered improper if they are used as a means of preventing or seeking to impede or deter a person from cooperating with a criminal investigation or prosecution, or reporting an offence to a law enforcement agency. Where a solicitor negotiates an NDA in these circumstances, the SRA warns that they risk violating several principles of the SRA Code of Conduct. This includes those which prohibit solicitors from taking unfair advantage of third parties and which require solicitors to uphold the rule of law and the proper administration of justice. And by using an NDA to stifle the discovery and reporting of criminal offences, the employer, through the solicitors they instruct, will almost certainly be treated as breaching their freestanding duty to prevent sexual harassment as a matter of employment law.

While the SRA’s warning notice is confined to NDAs, it serves the broader purpose of reminding solicitors that their clients’ interests cannot be advanced at all costs. It also highlights that they must be especially alert if their retainer becomes coterminous with enabling the evidence of criminal offences to be withheld from law enforcement.

This, of course, is not to suggest that solicitors are acting unethically if they advise their clients not to report such crimes. There is no positive obligation on employers to report workplace-based sexual offences to the police. While reporting such offences voluntarily may be perceived by employers as the ‘right’ thing to do, this is a choice, not a legal obligation (and plainly no choice about what is ‘right’ can be made unless it has the full and informed support of the victim). It follows that a solicitor is not acting in breach of their professional regulatory obligations if they advise their employer client to follow this legal framework to the letter.

But for a solicitor to give comprehensive advice to their employer client, in order that informed decisions about whether to report any offences to the police can be taken, knowledge of the criminal law is necessary. The definition of sexual harassment used in employment law is ‘unwanted conduct of a sexual nature which has the purpose or effect of violating [the victim’s] dignity or creating an intimidating, hostile, degrading, humiliating or offensive environment for [the victim]’. This potentially encompasses a multitude of crimes ranging from sexual assault, exposure and communications offences to stalking causing serious alarm or distress. And, as recent scandals demonstrate, when considering these (and other relevant) criminal offences, solicitors must be alert to whether the suspected criminality extends beyond the alleged primary perpetrator.

‘It would be a mistake to think that investigations of workplace-based sexual harassment can occur in a vacuum from the criminal law. Many types of sexual harassment will amount to criminal offences’

So how might individuals face criminal liability for having ‘enabled’ the commission of a suspected sexual offence in the workplace? This could take the form of secondary liability – where a person aids, abets, counsels or procures another to commit an offence or inchoate liability (encouraging or assisting another to commit an offence). As an obvious example, suppose A, B and V are work colleagues employed by E: A sexually assaults V at an office party; A is guilty of sexual assault; but where B spiked V’s drink at the start of the party, knowing that A intended to sexually assault V later on, B may be guilty of a separate offence of encouraging or assisting A’s sexual assault.

Other examples are less obvious. While the criminal law is generally unwilling to impose liability for omissions (that is, failures to act to prevent a crime from being committed), it has long been recognised that, where a person is under a legal duty to act, failure to discharge that duty can constitute encouragement or assistance. And because employment law now imposes a statutory obligation on employers to take reasonable steps to prevent sexual harassment of their employees, this obligation provides a foundation upon which employers can be criminally liable, if breached. To change the facts in our example: suppose A and V are work colleagues employed by E; they all attend an office party; A tells E that he plans to sexually assault V later that evening; E then leaves the party; and A sexually assaults V. A is guilty of sexual assault, but is E, by failing to discharge his legal duty as employer, to take reasonable steps to prevent the sexual harassment of V (as employee), guilty of a criminal offence of encouraging and assisting A’s sexual assault of V? The answer is a qualified ‘yes’, provided E’s failure did, in fact, encourage or assist A to commit the sexual assault against V.

This is an example of how an employer might be held criminally liable for having enabled the commission of an offence. But employers can also be held criminally liable for things they do after that offence is committed. For example, if they take steps to suppress the evidence of an offence or prevent the reporting of it to law enforcement. It is widely known that the offence of perverting the course of justice can be committed in relation to active criminal investigations and prosecutions (for example, giving false information to the police to frustrate their enquiries). What is sometimes not recognised is that this offence can also be committed before any criminal investigation has started, provided an event has occurred from which it can reasonably be expected that such an investigation will follow. To return to our example: if E learns that A sexually assaulted V at the office party, but E takes steps, either internally or through professional advisers, to discourage V from reporting the assault to the police, E could commit the offence of perverting the course of justice.

In short, it would be a mistake to think that investigations of workplace-based sexual harassment can occur in a vacuum from the criminal law. Many types of sexual harassment (as defined in employment law) will amount to criminal offences. The new statutory duty on employers to prevent sexual harassment widens the scope of inchoate criminal liability. Employers and their advisers may be exposed, not only to breaches of employment law or their professional regulatory obligations, but also to criminal investigation and prosecution, if the evidence suggests they have enabled the commission of offences within the workplace or prevented their discovery by law enforcement.

Andrew Smith is managing partner at Corker Binning, London