How a new EEOC harassment rule could cost employers 

And the regulations on businesses keep coming.   

This year, the Department of Labor, Federal Trade Commission and the National Labor Relations Board have all moved to require freelancers be classified as employees, raise overtime wages, eliminate non-compete agreements and expand the ways employees can be unionized.  Now, apparently, it’s time for the Equal Employment Opportunity Commission (EEOC) to have their shot. 

This time it’s about harassment, and if you’re not paying attention to how your employees are behaving — both in the office and yes, even at home — your business could be liable.  

That’s because a proposed rule issued earlier this month by the commission provides further guidance, clarifications and even expansion of the types of harassment defined under Title VII of 1965’s Civil Right Act. It’s going to create headaches for employers, both big and small.  

Want some examples?  

• Let’s say one of your employees is criticizing another on X (formerly Twitter) or Facebook about a political issue, to the point where the employee being trolled is now having a hard time doing their job. As an employer, you better be aware of this. 
• Or perhaps an LGBT employee overhears a group of other employees laughing at the story about Dylan Mulvaney and Bud Lite and is made to feel uncomfortable, or overhears someone making a racist comment or joke. That’s potentially harassment too. 
• Or maybe a worker at your office regularly confuses another worker’s preferred pronouns, causing upset. If you’re not doing something about it, then you’ve got a problem. 
• How about if a biological male employee who identifies as a woman is prohibited by other female employees from using the women’s rest room? Whose side are you going to take? The wrong decision could cost you. 
• What if one of your supervisors, who is genuinely concerned about an employee’s health during her pregnancy, assigns her more administrative tasks so that she doesn’t have to walk as much through the facility? That could be upsetting — and discriminatory. 
• Or what happens if, on a Zoom call, an employee has Hebrew language books on a shelf in the background and this makes an Arab employee on the call uncomfortable? Are you ready to dive into Middle East politics? 

Are you paying attention? 

Fully staffed with President Biden’s appointees and fully recovered from the decimation of the Trump years, the EEOC is back and armed for battle. In just the past year alone, the commission filed 143 discrimination or harassment lawsuits, which represents a more than 50 percent increase over the past year. And the numbers of claims and other actions are rising.  

Thanks to its awareness campaigns and according to data from the commission in fiscal 2022, the agency received 73,485 new discrimination charges, which represented an increase of almost 20 percent over the previous fiscal year. The commission also handled more than 475,000 calls — an 18 percent increase from fiscal 2021 — and managed 32 percent more emails from the public than the previous year.  

The proposed rule is open for comments until early November and is expected to be finalized early in 2024. The EEOC has made workplace harassment a top priority, saying that it’s a “serious workplace problem, [and] more than more than one-third of charges received by the EEOC (between 2016 and 2022) included an allegation of harassment.” 

What can an employer do? Three words: policies, reporting and training.   

If you’re running a business, you should make sure your internal policies regarding harassment have been updated to reflect these new requirements and that there is a straightforward and confidential process for employees who believe they’re being harassed to report incidents. Training — already required in some states like California and New York — should be regularly conducted. Talk to your labor attorney, hire an HR manager, consult with an employment specialist.  

Yes, this is a headache. And yes, this is going to cost you. 

Clearly, there is no justification for why anyone should feel uncomfortable going to work and doing their job, and there is no reason for someone to be harassed or bullied because of their sexual orientation, race, religion or health.   

The EEOC’s new rules certainly increase awareness of these issues, which is a good thing for some workers. But unfortunately, it’s also going to cause more employees to take advantage. Yes, there are legitimate harassment claims that need to be addressed. But there’s bound to be many more frivolous claims. Unfortunately there’s a subset of employees who would prefer to make their money in the courts than by actually just doing their job. So, like everything else, it’s the very small number of people doing this that will cost everyone. 

A client told me the other day that his workplace is becoming like a schoolroom. “I spend less time serving customers and more time making sure my employees are behaving,” he said. “All of these new rules are just creating more headaches.” 

You really can’t blame her for feeling that way. Unfortunately it’s employers — particularly small employers — who will need to bear the burden. There will be legal and consulting fees, added salaries for HR personnel and more costs for training and compliance. And it’s all a distraction from focusing on making their products and delivering their services so that they can grow their companies, hire more people and provide better benefits for their existing workers. 

Gene Marks is founder of The Marks Group, a small-business consulting firm. He frequently appears on CNBC, Fox Business and MSNBC.