Common challenges in dealing with 

 sexual harassment in the workplace 

Sexual harassment in the workplace is a violation that occurs in the recruitment or workplace when words or actions of a sexual nature are used against the will of the other party, placing the job applicant or employee at a disadvantage or in an intolerable hostile environment at work[1]. Due to the employment relationship established between the employee who is the victim of sexual harassment and the company, the company has direct control over the workplace and work environment of the employee, and it is capable of assuming the obligation to prevent and deal with sexual harassment incidents.

After an incident of sexual harassment in the workplace, companies are often faced with multiple pressures from both the perpetrator and the victim. A large proportion of these cases are disputes arising from the termination of the employment contract of the perpetrator, and the success rate of such cases for companies is often quite low, which can be attributed to the following two main reasons :

(I) Lack of effective institutional basis

The Law on the Protection of Women's Rights and Interests (2022 Revision) clearly stipulates that companies should establish rules and regulations prohibiting sexual harassment[2]. In practice, the rules and regulations, as "quasi-regulations", are also the legal basis for companies to investigate and deal with such incidents. In practice, many companies have consciously established rules and regulations to prevent sexual harassment, but sometimes they fail to comply with the democratic and public disclosure procedures, or the rules and regulations are unclear, resulting in the loss of such cases.

The Supreme Court Guidance Case No. 181[3] provides a positive example of how to establish rules and regulations for a company. In this case, the company terminated the employment contract for serious breach of discipline because the employee failed to perform his management duties, not only failed to take measures but also retaliated after his subordinate was sexually harassed, and made false statements in an internal investigation. The Employee Handbook and the Code of Business Conduct, which were the basis for the termination, were subject to a lawful democratic and public disclosure process and were signed and acknowledged by the employee. The Code of Business Conduct adequately explains that managers have managerial responsibilities and are not subject to retaliation, and includes such breaches in the Employee Handbook as grounds for disciplinary termination.

In addition, the company in this case has made the abstract obligation to prevent sexual harassment in the rules and regulations into the duties of the relevant management personnel. If relevant personnel fail to perform his or her duties, this will constitute a serious breach of the rules and regulations and the company shall be entitled to terminate the employment contract.

(II) Insufficient factual evidence

Sexual harassment in the workplace is often sudden, episodic and hidden, and it is difficult to keep physical, documentary and personal evidence. Many victims are trapped by public pressure and fail to complain to the company in time, which makes it more difficult for the company to collect evidence and carry out follow-up treatment. In disputes over the termination of employment contracts, the onus of proof is on the company to prove the existence of sexual harassment and disciplinary acts. In practice, most companies will submit witness statements of their own employees as evidence, and without other evidence to corroborate each other, they face a high risk of losing the case.

In Judgment No. (2017) Su 0117 Civil Final No. 3760, the court held that the evidence provided by the company, such as recorded conversations and witness testimonies were all from internal investigation and the witnesses did not appear in court to cross-examine, so the court ruled against the company on the grounds of lack of factual basis. In Judgment No. (2017) Shanghai 0117 Civil No. 14018, the company submitted a number of witness testimonies, but the court held that the witnesses were all current employees of the company and had an interest in the company, and there was no other evidence to support the company’s claim. The company lost in the end. In Judgment No. (2021)Jing 0115 Civil No.5516, the court held that the company failed to provide the original carrier of the WeChat chat records, and the employee who was allegedly harassed failed to testify in court, and ruled against the company.

Therefore, after the occurrence of sexual harassment, the company should promptly initiate investigation procedures and produce written records of conversation and investigation reports; at the same time, pay attention to the collection and fixing of evidence so that all evidence can be corroborated each other, which is more likely to be accepted by the arbitration and court.

In a recent case handled by our team, an employee repeatedly sent harassing messages to a female colleague and the company terminated the employment contract in accordance with the provisions of the Employee Handbook. We submitted notarised harassing messages, complaint emails and written testimony from the victim and applied for witnesses to testify in court. In the end, the court ruled in favor of the company.

 Legal Advice 

Given the unique nature of sexual harassment in the workplace, if companies do not handle it properly, they may not only face litigation, but may also attract public attention and affect their reputation and social evaluation. In order to prevent sexual harassment in the workplace and to effectively manage employment, we would like to provide the following compliance recommendations for your reference.

(I) Create a safe, healthy and equal working environment

Companies should create an open and safe working environment for their employees. The layout and decoration of workplaces should be as open and transparent as possible. In addition to the installation of necessary confidentiality and sound insulation facilities, the partitioning of work spaces with strong enclosures should be reduced. Surveillance cameras in public offices should be set up so that there is full coverage without dead ends, and employees should be informed and kept properly informed of all surveillance information.

Companies should establish a healthy corporate culture and regularly educate all employees about sexual harassment in the workplace, and include relevant content in induction, management and daily training to raise awareness of sexual harassment in the workplace among all the employees and management.

(II) Establish solid rules and regulations

In addition to establishing a separate system, a special section on prevention of sexual harassment in the workplace is recommended to be added to the company’s rules and regulations, such as the Employee Handbook.

The rules and regulations should begin with a definition of sexual harassment in the workplace and the various types of situations in which it can manifest itself, indicating the company's attitude of "zero tolerance" for sexual harassment. Sexual harassment should be included in the disciplinary provisions, making it clear that different levels of disciplinary action match different penalties, and that the managerial responsibilities of the relevant management should be regulated, and that if the manager fails to comply, he or she should also receive disciplinary action. It is also recommended that the rules and regulations should include a specific body (person in charge) responsible for the prevention and control of sexual harassment in the workplace and its contact details, a specific process for reporting complaints, an internal investigation and handling mechanism, disciplinary measures for perpetrators and measures against retaliation.

When formulating relevant rules and regulations, in order to ensure the effectiveness of their formulation, companies should promptly announce the system to employees, seek their opinions, and require them to sign for confirmation and fulfil democratic procedures, in accordance with the law.

(III) Establish an internal system for receiving complaints, investigating and problem-solving

Companies should set up a special institution (or person in charge) to centrally receive complaints and deal with sexual harassment cases. If possible, a special disciplinary committee can be set up, or, according to the internal organization of the company the human resources department, legal compliance department and other departments can take up the corresponding responsibilities. Specific responsibilities include investigating and handling related complaints and reports, organising training and publicity, as well as conducting self-investigation and monitoring against sexual harassment in the workplace.

Specialised institution (person in charge) should set up multiple complaint channels, receive complaints and instruct employees to report to the police in a timely manner; be responsible for fact-finding procedures, collecting and fixing evidence and providing feedback on fact-finding in a timely manner, keeping records and producing investigation reports. If necessary, a third-party professional agency may be engaged to assist in the investigation. The institution should also assist in disciplining the perpetrator of sexual harassment and providing redress to the victim; be responsible for monitoring follow-up matters, preventing retaliation and differential treatment, and avoiding secondary harm to the victim(s).

(IV）Privacy protection and employee care

In the process of investigation and disposal, companies should pay attention to legal compliance, take strict confidentiality measures for the privacy and personal information of the parties involved and relevant witnesses, and protect the right of reputation of the parties concerned. At the end of the investigation, when the company makes a decision to terminate the contract, the notice of termination should be delivered to the person, and the wording of the notice should be as objective and truthful as possible, and it is not recommended that the notice be posted or communicated in a wide range of forms to avoid disputes related to reputation rights.

At the same time, companies should also focus on employee care. Throughout the process of dealing with sexual harassment incidents, the company should listen carefully to the victim's claims, pay attention to the victim's psychological state and provide psychological counselling to the victim when necessary.

It is hoped that the above sharing will help companies in need to effectively establish standardised and feasible sexual harassment prevention and control measures to minimise or avoid the occurrence of sexual harassment in the workplace, protect the human dignity and labor rights of employees, maintain a safe, healthy and equal employment order in companies, and build harmonious labor relations.