two construction workers talking
Defending company culture, reputation & profits from workplace misconduct

Construction leaders at all levels must be aware of the rising risks of workplace misconduct. Company principals should be prepared to promptly and effectively investigate all circumstances of misconduct in the workplace. This includes incidents both in the office and on jobsites.

In today’s increasingly litigious environment, there can be no ignoring these circumstances. Companies that turn either a blind eye or cold shoulder to these situations face growing risk of punitive actions. The stakes are high, including:

  • Damage to company culture where trust can quickly erode and turn into “us versus them” conflict.
  • Reputation risk that will hurt the company’s efforts in recruiting and retaining top talent and jeopardize relationships with owners, financiers, subcontractors and suppliers.
  • Profit loss from legal defense costs during pre-litigation discovery and negotiated settlements or legal judgments, as well as indirect costs associated with lost productivity participating in investigations, depositions, negotiations, arbitrations or trials.


Origins of Liability

The Civil Rights Act of 1964 (Title VII) makes it unlawful to discriminate on the basis of race, color, national origin, sex (including pregnancy, sexual orientation and gender identity) or religion. The Equal Employment Opportunity Commission (EEOC) exists to enforce this federal law which applies to most employers with at least 15 employees in all types of work situations, including hiring, firing, promotions, harassment, training, wages and benefits.


Not Enough to Prevent Misconduct

Diversity, equity and inclusion (DEI) efforts have a large piece in altering mindset within the workplace. DEI initiatives alone are simply not enough.

A 2021 survey conducted by the Workplace Bullying Institute (WBI) found 39% of respondents (employed Americans) suffer abusive conduct at work, while 73% are aware that bullying happens. Based on the 2020 U.S. Bureau of Labor Statistics estimate on U.S. civilian labor force, that equates to about 48.6 million workers directly bullied.

Women across the nation have raised their voices about unwanted physical contact or biased treatment. In 2018, Engineering News-Record (ENR) spotlighted the #MeToo movement. They conducted a survey of 1,248 people throughout the construction industry.

The survey showed 66% of respondents reported facing gender bias or sexual harassment at the workplace or jobsite. Such experiences leave team members emotionally scarred and could be a major reason construction remains a heavily male-dominated industry.


Construction Is at Risk

There have been a number of high-profile and widely publicized incidents that focused the spotlight and scrutiny on the construction industry. This includes reports of nooses on construction projects across the country. These incidents have also included examples of hazing and bullying, as well as alleged and actual harassments and discrimination — including hostile work environments from pervasive conditions and threatened sexual assaults. Due to the increased social and political attention, reporting misconduct is generally becoming more acceptable. However, nearly 60% of all misconduct that is observed in the workplace is never reported, according to Gartner, Inc. This alarming statistic stems from a fear of retaliation, being ostracized, hoping the issue will “just go away” or simply not knowing whether their company has provided a way to seek unbiased guidance. The reality is:

  • The EEOC has increased its enforcement actions against construction companies.
  • The EEOC held a summer 2022 hearing in focused on discrimination in the construction industry.
  • There’s been an increase in employment practices liability insurance claims involving workplace misconduct.
  • The average cost for an EEOC enforcement infraction is $160,000. There have been significantly higher judgments.
  • The real risk is reputation risk and punitive damages if those were to be assessed for willful or repeat offenses.


Removing Bias From Investigations

Historically, organizations have looked to department leaders, human resource professionals or internal general counsel to conduct investigations and provide recommended corrective actions.

This may pose a threat of unconscious bias or conflicts of interest impacting decision-making when it comes to Title VII workplace investigations. Employees may feel the system is rigged against them — regardless of how well-written a company policy is, how many avenues are given to employees to lodge complaints or how often a company talks about a culture of accountability.


To promote a culture of exchanging “bystanders” to “upstanders,” it is recommended to have external trusted advisors, as well as providing alternative, third-party avenues to report.


8 Steps to Reduce Risk

  1. Adopt zero tolerance for workplace misconduct, including bullying, harassment, discrimination and retaliation.
  2. Establish procedures to ensure employment screening, interviewing and hiring practices are nondiscriminatory.
  3. Develop clear policies in employee handbooks and/or procedure manuals outlining the expectations and requirements of a respectful workplace culture and specifically prohibiting workplace misconduct.
  4. Educate leaders/managers and supervisors on the expectations and requirements for the company’s zero tolerance for workplace misconduct and how to respond to alleged workplace misconduct.
  5. Train employees on the expectations for respectful workplace culture. Inform employees steps to take if they are the object of perceived harassment or discrimination by a supervisor, coworker or vendor/supplier.
  6. Develop a confidential process for reporting incidents of alleged or actual workplace misconduct, including bullying, harassment, discrimination and retaliation.
  7. Conduct a timely, confidential and objective review to investigate the circumstances in any reported incident of alleged or actual workplace misconduct.
  8. Maintain documentation of all actions your company has taken to prevent, mitigate and resolve alleged or actual employee misconduct in the workplace.


Enough is enough. Now is the time to eliminate the threat of workplace misconduct. Leaders and organizations alike can no longer fail to acknowledge the detrimental damage workplace misconduct presents. Companies have a greater cultural and fiduciary responsibility to act. To build the next generation of workers, barriers to equal opportunity and safe working conditions must be removed.