For large and small companies alike, the recent swirl of litigation surrounding Activision and Blizzard has likely been of keen interest. After all, they have been sued and under subpoena by multiple state and federal agencies, mass negative internal and external employer press releases and even, shareholder group issues. It has been perfect example of cascading business issues and the problems they cause. So, what can other employers learn from their employment law issues?
The sex harassment and discrimination lawsuit
Activision Blizzard was sued by California and the federal government over the summer based on allegations of sexual harassment and illegal discrimination. In September though, that lawsuit was settled. They agreed to an $18 million settlement that included the hiring of a Chief People Officer, who will oversee the adoption of new policies, procedures, trainings and employee review procedures to weed-out and stop their equity issues, entrenched sexual harassment and illegal discrimination.
Companies need to be proactive to avoid these types of lawsuits. This means having specific employees that are empowered to seek out and eliminate illegal and discriminatory behaviors. It is also advisable to have trainings and written policies that focus on equity and parity among employees, supervisors and managers. This usually means brining in a neutral third-party to go over the company’s current policies, procedures, trainings, etc. Though, avoiding these types of lawsuits can save companies millions in cash, but also in public goodwill, which can be far more valuable to keeping a business viable.
Mandatory arbitration agreements
Prior to Oct. 28, Activision Blizzard forced their employees to sign mandatory arbitration agreements, which mandated that they enter into binding and confidential arbitration for claims against the company, including sexual harassment and discrimination. They are no longer enforcing these agreements and not making new employees sign them. However, prior to this policy change, this allowed the company to hide (whether intentional or not) systemic discrimination issues, along with mitigating their damages. Though, it also exacerbated their legal issues once this policy came to light.
As our Houston, Texas, employer readers can see, employment law can be complicated and have lasting affects on one’s business. Though, if one is proactive with their policy making, they can usually avoid most legal issues.