One of the most difficult scenarios any business could face is how to deal with a customer or client who is acting inappropriately. On the one hand, most companies have zero tolerance policies regarding harassment in the workplace. On the other hand, a business cannot exist without customers. A business who reprimands its customers may find itself without any pretty soon. What is a business to do?
Lessons can be learned from Costco, which recently found itself in such a position. One of its employees has been engaged in a lawsuit against the company, claiming that it maintained a hostile workplace because it permitted a customer to harass her. The employee alleged that a male customer consistently visited Costco while she was working and would make comments to her that made her feel uncomfortable. The customer allegedly made references to stalking, and commented that she “looked scared” when he approached her.
After the employee complained to the store managers about the customer’s behavior, the managers met with the customer and told him to minimize his contact with the employee. This apparently did not work, as he allegedly continued to bother her, asking her “intimate questions” and hiding behind clothing and staring at her. After the employee caught the customer videotaping her, the Costco managers told him that it would be best if he stopped shopping at their Costco, which he apparently did. However, the customer spotted the employee shopping at another Costco and began yelling profanities at her loudly, which led Costco to revoke his membership and ban him from their stores.
About a year prior to this, the Costco employee had taken a medical leave of absence, claiming, among other things, that she was scared to come to work because of the harassing customer. Once the employee had exhausted her medical leave, she refused to come back to work, which led Costco to fire her.
The employee sued Costco, alleging that it subjected her to a hostile work environment by permitting the customer to harass her. A hostile work environment is one where an employee faces discriminatory intimidation, ridicule, and insult that is severe or pervasive and offensive. Employers have an obligation to prevent hostile work environments if they learn that one has been created.
The employee claimed that Costco did not take action soon enough to prevent a hostile work environment. She claimed that her managers knew that the customer was harassing her, but they did not do enough to stop the harassment. The court ruled that there was enough evidence of a hostile work environment for a trial to proceed.
So, what could Costco have done differently here? I should note, first, that Costco did a lot of things right. It maintained an anti-harassment policy that it taught to new hires during an orientation. It also maintained an “open door” policy that encouraged employees to contact any Costco manager to help them resolve a workplace problem, and, if need be, contact the corporation’s HR department. Costco also conducted annual training programs designed to provide employees about conduct that could violate its anti-harassment policies. All of these efforts are useful in rebutting claims of a hostile work environment.
Despite these policies, it appears as though the Costco managers did not do enough to protect their employee. They probably should have banned the harassing customer from their store once they learned of his behavior. It is understandable, however, why they might have been unwilling to do this. “The customer is always right,” after all. Banning the customer right away may have led them to lose some money in the short run, as he, and perhaps his family and friends, would have stopped shopping at Costco. In the long run, however, Costco would have avoided the legal fees and potential judgment resulting from this lawsuit.
Ultimately, employers should take a few things away from this case. First, they should follow Costco’s lead and have anti-harassment policies in place and provide their employees with anti-harassment training. Second, they should stand up to anyone engaging in harassment, including customers.