Until fairly recently, allegations of sexual misconduct in the workplace were often brushed under the carpet or accepted as something commonplace and to be expected. 2017’s watershed #MeToo moment has changed all of that.

Not only do people feel more empowered to speak out about such abuse, but also what was once considered a private HR matter is now also a regulatory issue for both employers and individuals accused of misconduct.

A cultural shift

Prior to 2017, when a #MeToo style incident took place, the scenario would commonly play out as follows:

• In a large proportion of cases, the complainant would believe that mistreatment was part of working life and accept it; or they might choose to move on; or – in a minority of cases – they would report an allegation of sexual misconduct.
• The allegations may have been investigated to an extent; however, often the behaviour complained of was already known about and wasn’t checked, and employers and colleagues would not be inclined to step in and support.
• In some instances, the complainant would feel pressured to leave the organisation, perhaps with a payment in exchange for signing a settlement contract containing a non-disclosure agreement. Often the senior employee accused of sexual misconduct would remain in their role.

In the wake of #MeToo, things are shifting. There’s a wider acknowledgement that such behaviour is unacceptable and, as a result, employees feel more empowered to complain. More organisations are now treating it as an issue that needs to be handled via proper grievance and disciplinary procedures (rather than ignoring it or seeing the alleged victim as a troublemaker who should be silenced and paid off).

For some organisations, however, this will not be enough. Indeed, professionals within certain industries may find that matters are taken out of their hands.

A regulatory issue

For professionals who work in a regulated industry (such as financial services or in the legal sector), the notion of proper conduct is familiar.  Different regulators may phrase this differently: for example requiring professionals to be ‘fit and proper’, ‘act with integrity’ or behave in a way that ‘maintains trust in the profession’. Essentially, however, in order to work in a regulated profession, the appropriate body must deem you to be of good character.

Until recently, these regulatory requirements were traditionally viewed as being primarily applicable to professional conduct and honesty, within fairly specific remits. However, personal impropriety is increasingly being seen as a matter for the regulator, and regulators like the Financial Conduct Authority (FCA) and Solicitors Regulation Authority are making it clear that it will take a dim view of any firm that tolerates sexual misconduct or harassment.  Regulated individuals have been accused of professional misconduct in the wake of allegations of inappropriate sexual behaviour towards colleagues.

Additionally, the once commonplace (and now fairly infamous) practice of pressuring alleged victims to sign onerous non-disclosure agreements is no longer an option; any provisions which attempt to restrict disclosures of criminal or regulatory wrongdoing will be unenforceable. Regulators will also view with disfavour any firm – or lawyer – attempting to impose overly restrictive non-disclosure agreements.

Instead, regulated firms are encouraged to put mechanisms in place that ensure complainants are not discouraged from speaking out; to be transparent with their regulator about sexual misconduct investigations; and to adopt a zero-tolerance approach to sexual misconduct.

Next steps

The FCA has stated that it sees a link between poor culture and poor outcomes, as environments in which employees don’t feel supported to speak out are likely to foster poor decision making. With this in mind, it’s not only the way in which sexual misconduct allegations are handled that needs to change, but also the overarching culture that exists within certain organisations.

This might be easier said than done.  Where a particular culture has prevailed for decades, strong leadership (both internally from company leaders and externally from the regulator), effort at all levels, and time will be required to effect change.  However, the extension of the Senior Managers Certification Regime and the threat of sanctions means that the pressure is on for progress to be made quickly.

There is no failsafe against #MeToo-style allegations – even the most inclusive cultures will face reports of wrongdoing. When considering how best to handle sexual misconduct allegations, employers will have to consider the following questions:

• Does the allegation have any criminal ramifications? The threshold for this is lower than might be expected, so organisations must tread carefully to ensure that their investigation does not compromise any potential future enquiry.
• How appropriate is it for the concerned parties to remain at work and in their current roles? This can be really tricky to balance: it may well be impossible for the complainant and alleged perpetrator to continue to work together during an investigation, but in practice it will also be difficult for either of them to return to work after a period of absence in these circumstances. This question requires thought and sensitivity, and options such as a temporary change in role or reporting structure may be considered.
• At which point should the matter be reported to the regulator? It is important to report relevant allegations promptly and be transparent, but the employer will need sufficient information for any report to be meaningful.
• Am I being mindful of my particular obligations? HR professionals should give serious thought to how best to support both parties, at the same time as being careful not to offer more than can be delivered (it is unlikely to be possible to guarantee complainants’ anonymity, for example). Employers, too, should appreciate that they have a responsibility not only to the alleged victim, but also to those who are being accused (increasingly known as ‘Reverse #MeToo’), for whom allegations can have life-changing ramifications.

How Bellevue Law can help

The recent changes mean that sexual misconduct is no longer simply an internal issue. In fact, people who are accused of such an offence could suffer very severe consequences: as well as being reputationally damaging, sexual misconduct allegations could be career-ending, have a grave and lasting impact on a person’s private life, and even lead to criminal prosecution.

As such, it’s more important than ever for both the alleged victims and the accused to receive a fair hearing. Bellevue’s expert team have experience in both #MeToo and #ReverseMeToo cases, and can act for complainants, defendants and even assist organisations as impartial investigators during the fact-finding stages.

If you require advice in relation to a misconduct allegation, Bellevue Law’s experienced employment lawyers are here to help. Contact us today to organise a no-obligation discussion with our specialist team.

Disclaimer: this material is a general overview only, and is not intended to provide legal advice.