Sexual Harassment by Customer Results in $250k Damage Award to Costco Worker

There is a saying that is particularly pervasive in retail that, “The customer is always right.” But this is not true when the customer behaves in a manner that is threatening or hostile to store employees. This includes instances of sexual harassment. woman

Sexual harassment is a serious and pervasive problem in American workplaces. It also is not limited to interactions with co-worker or supervisors. Sexual harassment can occur in the context of other professional relationships, including those between customers and suppliers.

Further, sexual harassment in those situations does not need to consist of any outright demand for sex or sexual favors in exchange for business. It can take on a wide range of inappropriate behaviors or unwanted advances, including dirty jokes, repeated sexual innuendo or the use of offensive language. Although business owners may not be protected under sexual harassment laws, they do have the option to end the contract. Employees, however, are considered more vulnerable and they may be covered under sexual harassment laws. 

Take for example the recent verdict in a federal sexual harassment lawsuit filed against wholesale company Costco. Jurors ordered the retailer to pay $250,000 to a former employee for failure to protect her from sexual harassment by a customer at one of its stores in suburban Chicago. According to The Chicago Tribune, the lawsuit, filed in 2014, alleged the club created and tolerated a working environment that was sexually hostile. Specifically, plaintiff endured sexually offensive comments, unwanted touching, advances that were unwelcome and stalking by a customer. Amid all of this, the company allegedly did nothing to stop this.

Plaintiff was a part-time employee at the store, and worked as a front-end assistant. That meant she helped customers box what they had bought and also returned items deemed unwanted at the checkout back to their rightful place on the shelves.

At some point, she encountered a customer who became enamored with her. He started asking her on dates, which she declined. He hugged her and touched her without her consent. He started taking video of her at the store, and began behaving in a hostile manner toward her after she reported these incidents to her supervisors.

Eventually, she was reportedly left with no choice but to seek a restraining order against the man.

The company declined to respond to the Tribune’s request for comment following the verdict, which was obtained with assistance from the U.S. Equal Employment Opportunity Commission (EEOC). Court records indicate the wholesale firm vehemently denied wrongdoing and insisted its supervisors exercised a reasonable degree of care to prevent and promptly correct the alleged harassing or discriminatory behavior.

In this case, the company was accused of failing to take reasonable preventative or corrective action in a way that was both timely and effective. The store manager did ultimately advise the customer to shop at a different store location, but only after its employee took a leave of absence due to being overwhelmed by emotional distress. Later, she was fired under the company’s leave policy.

Jurors in this case did not find cause to impose punitive damages, but did find the store didn’t do enough to protect its worker from this ongoing sexual harassment.

Contact the employment attorneys at Nassiri Law Group, practicing in Orange County, Riverside and Los Angeles. Call 714-937-2020.

Additional Resources:

Former Costco employee awarded $250,000 over customer’s alleged harassment, Jan. 19, 2017, By Lauren Zumbach, The Chicago Tribune

More Blog Entries:

Report: Sexual Harassment, Rarely Reported, Knows No Occupational Bounds, Jan. 15, 2017, Orange County Sexual Harassment Lawyer Blog