After the company's investigation confirmed the alleged kiss, the executive was terminated.
The Benefits Committee at Quaker Oats determined that because the executive was terminated for gross misconduct, he was not eligible for severance benefits under the terms of the plan. The executive, however, argued that his latest misconduct was not sufficient to give rise to an actionable claim for sexual harassment under federal law. Further, he contended, the company could not adopt a policy with regard to sexual harassment that was more stringent than federal law. Therefore, he asked the court to conclude that his conduct did not justify the denial of severance benefits.
The Seventh Circuit Court reviewed the executive's conduct in the context of recent sexual harassment case law and concluded that it was not sufficiently severe or pervasive to violate federal law. Significantly, however, the court also recognized that the employer was free to apply a stricter policy against sexual harassment than that required by federal law. The Seventh Circuit Court ruled that the fact that Quaker Oats interpreted its policy in a manner more stringent than required by federal law was justified in light of the company's purpose, which was to address incidents of sexual harassment before they evolve into more severe situations, wherein the company would become liable to a federal lawsuit against the company.
The court reasoned that the material issue was not whether the executive's conduct violated the law, but whether he was afforded sufficient notice of his employer's stricter policy against sexual harassment. The Seventh Circuit Court concluded that the executive had received sufficient notice of this stricter policy and the consequences of any further violation on his part.
This particular case provides support for the conservative approach...