Sexual Harassment And Your Small Business: 4 Things To Know

When it comes to sexual harassment in the workplace, all businesses are said to hold responsibility. However, it’s essential to know small companies might receive greater scrutiny. Though larger enterprises still have most of the stigma of sexual harassment, recent findings show that may no longer be the case. Ultimately, your small business must provide a safe working environment for your employees.

As such, learning how you respond to these situations is of greater importance. Aside from possible damage to your business’ reputation, dealing with lawsuits can utterly devastate your finances. How you use the tools available to your companies might get you ahead of the competition.

Read on and learn what your small business can do regarding sexual harassment in the workplace.

  • Sexual Harassment Cases May Negatively Impact Your Company’s Image

As a small business, getting a foothold in the market will be one of your first challenges. This makes your organization’s reputation very important. Prospective customers first learn of you from what they hear.

Nonetheless, a harassment case can negatively impact your business’ image. Its most significant effects will be the gradual loss of customer and team member trust. Damage to this basic foundation of a company will be challenging to rebuild. 

This makes creating a comprehensive plan for preventing and addressing sexual harassment essential. Aside from containing the situation, it also gives fair treatment to everyone involved. Additionally, it shows your company’s commitment to preventing and addressing sexual harassment. Dealing with the matter helps empower team members and boost your company’s image.    

  • Team Members’ Morale Can Be Affected By Sexual Harassment

Small businesses have a reputation for being more relaxed than their larger counterparts. The closer proximity helps to make everyone feel seen and heard. And yet, news of harassment can disrupt this dynamic. 

Team members may find it difficult to go back to work after news of sexual harassment. They may have difficulty concentrating. Losing even one team member can be devastating for small businesses. As each person fills a crucial role in the company, finding a new hire for the position will be much more challenging with news of sexual harassment. 

Making your stance clear on sexual harassment is necessary on two points. Firstly, it covers your business should it occur. Next, it helps set your team members’ minds at ease. Addressing this early can help make your company an example of the ideal work environment. 

  • Education And Communication Is Key In Handling Sexual Harassment 

The best way to deal with sexual harassment is through proper education and open communication. Seminars and training sessions about the subject matter are more common practices in many organizations. Nevertheless, your small business can prepare itself through other means. 

A comprehensive written policy can be a solid deterrent to sexual harassment in the workplace. This document can serve as a legal document signifying the agreement you’ve reached with your employees. Furthermore, having a well-written policy on personnel safety and diversity dramatically improves your company image through empowered employees.

A written policy will help make employees feel safer at work. As such, your policy should contain the following:

  • Provides clear definitions and examples of sexual harassment;
  • States your business’ prohibition and non-tolerance for all types of discrimination, particularly harassment; 
  • Assures employees that every step of the process strictly adheres to confidentiality;
  • Ensures employees that they suffer no retaliation after making a claim; and
  • Contains exact procedures performed after reporting instances of sexual harassment.

Those who experienced harassment report feelings of ostracization from their workplace. As such, open communication on this topic will help dispel fears and biases. In addition, this can help educate them on behaviors and language that may be deemed inappropriate. Ultimately, a written policy serves when the employer and team members understand its contents. 

  • Consider Availing Of Sexual Harassment Insurance Policies

Another option for your small business is to acquire a harassment insurance policy, otherwise known as Employment Practices Liability Insurance (EPLI). Although subject to the laws and limitations of your area, they can be an added source of protection for your business.

EPLI policies aim to protect businesses against lawsuits or claims regarding employment relationships between employees and employers. 

Generally speaking, court matters can quickly dry up the financial resources of the parties involved. Suits are hazardous as they include defense costs, settlement costs, and court fees in favor of the complainant. Ultimately, speaking with your insurance agent about incorporating this into your policy should greatly help your business.


Sexual harassment is a serious matter and its approach should be with care. To boot, small businesses may prove to be the new standard for these situations. Prevention can be as simple as proper policy documentation and open communication in business management. Moreover, you can prepare for lawsuits long before they become an issue. 

In the end, providing a safe workspace for your employees means a successful business more often than not. 



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