Sexual harassment claims against NAR may not be settled just yet

At Inman Connect last week, hot topics and equally hot takes were easy to find.

The bombshell commission lawsuits drew heat from industry watchers as the cases inch closer to their trial dates while the relative merits and failures of the National Association of Realtors’ Clear Cooperation rule and the emergence of artificial intelligence provided fresh fodder for discussion from panelists.

But it was likely Brad Inman who dropped the biggest bombshell when he told a rapt audience inside the Aria Resort & Casino in Las Vegas about a text message he’d received earlier that week from an unidentified source. It was a big public confirmation of what many had already been whispering about before the event.

“New York Times investigating NAR for sexual harassment,” he announced to the crowd, apparently quoting from a source privy to a big expose The Times may or may not be working on involving recent allegations, since withdrawn, made against the trade organization in June.

Spokespeople for both the National Association of Realtors and The New York Times declined to comment when asked by Inman to confirm whether a story about the trade organization was in the works, with NAR saying it can’t comment without first seeing the contents of the article and The Times saying it doesn’t comment on stories that “may or may not run in future editions.”

But if The Times actually has evidence of widespread sexual harassment at NAR with multiple people coming forward on the record — which, to be clear, has not been confirmed — it would give credence to sexual harassment and retaliation claims Janelle Brevard made in her short-lived litigation. Even more importantly, it would completely discredit the narrative being put out by the current leadership team and their attorneys. 

What’s ahead for NAR and any perpetrators

If allegations of sexual harassment and retaliation are indeed true, additional litigation is on the horizon. Below is a list of the type of actions that could be filed against both NAR as well as any perpetrators of these acts. An even bigger bombshell would be if the current NAR leadership team has engaged in a coverup of these acts that was paid for with membership dues. 

Civil lawsuit complaints alleging sexual harassment

Sexual harassment is a form of sex discrimination under Title VII of the Civil Rights Act of 1964, administered by the Equal Employment Opportunity Commission (EEOC). 

Victims may file civil lawsuits against the perpetrator(s) and the organization for monetary damages. The organization can be held liable, especially if it is proven that they were aware of the harassment and failed to take appropriate action. 

EEOC complaints 

The EEOC enforces federal laws against workplace discrimination, including sexual harassment. According to the EEOC website, sexual harassment can include:

Unwelcome sexual advances, requests for sexual favors, and other verbal or physical harassment of a sexual nature. Harassment does not have to be of a sexual nature, however, and can include offensive remarks about a person’s sex. For example, it is illegal to harass a woman by making offensive comments about women in general.

Both victim and the harasser can be either a woman or a man, and the victim and harasser can be the same sex.

Although the law doesn’t prohibit simple teasing, offhand comments, or isolated incidents that are not very serious, harassment is illegal when it is so frequent or severe that it creates a hostile or offensive work environment or when it results in an adverse employment decision (such as the victim being fired or demoted).

If the employer has 15 or more employees, victims must file a complaint with the Equal Employment Opportunity Commission (EEOC) within 180 days. After investigating the complaint, the EEOC may sue the employer on the victim’s behalf or issue a “right to sue” letter, allowing the victim to file a lawsuit.

Criminal charges

In some cases, if the sexual harassment includes criminal conduct such as sexual assault, the perpetrators may face criminal charges. In this scenario, the state attorney general and/or local law enforcement would prosecute the accused. The victim would likely serve as a key witness.

Retaliation and whistleblowers

What is retaliation? According to WB&S LLP: 

The Civil Rights Act protects employees from sexual harassment in the workplace. What many people don’t realize is that these laws also protect employees from retaliation. Retaliation occurs when an employer punishes an employee for filing complaints regarding sexual harassment or discrimination in the workplace. Various federal laws protect against retaliation and establish the rights of “whistleblowers” (people who file complaints about unsafe workplaces). Retaliation can take a variety of forms, including:

• • Demotion
  • Salary reduction
  • Job termination
  • Denial of a raise
  • Denial of promotion
  • Missed training opportunities
  • Job reassignment
  • Less desirable schedule
  • Poor performance review
  • Micromanagement
  • Exclusion from staff activities

Some forms of retaliation are obvious while others are subtler. Any negative action from an employer following a harassment claim is potentially retaliation. The Equal Employment Opportunity Commission (EEOC) deems retaliation illegal, regardless of whether the claim was true, if the employee made the claim in good faith. In other words, an employer isn’t legally justified to commit retaliation just because sexual harassment never really occurred in the workplace.

Defamation claims

If an organization or its representatives make false statements about a victim in an attempt to discredit them, the victim may have grounds for a defamation lawsuit. According to Britannica, defamation is:

The act of communicating to a third-party false statements about a person that result in damage to that person’s reputation. Libel and slander are the legal subcategories of defamation. Generally speaking, libel is defamation in written words, pictures, or any other visual symbols in a print or electronic medium. Slander is spoken defamation.

Constructive discharge or dismissal

According to the U.S. Department of Labor,  

The term “constructive discharge” is when a worker’s resignation or retirement may be found not to be voluntary because the employer has created a hostile or intolerable work environment or has applied other forms of pressure or coercion which forced the employee to quit or resign. This often arises when an employer makes significant and severe changes in the terms and conditions of a worker’s employment. What constitutes a constructive discharge is usually defined in state law and varies from state to state.

In a sexual harassment case, constructive discharge occurs: 

When sexual harassment becomes intolerable, a woman may quit her employment and sue for constructive discharge (forced resignation). Constructive discharge claims are in many respects like unfair firing claims and permit the same remedies, such as damages for emotional distress and lost wages. To establish a constructive discharge claim, a sexual harassment victim must show that the employer either intentionally created or knowingly permitted working conditions that were so “intolerable” or aggravated at the time of the employee’s resignation that a reasonable employer would realize that a reasonable person in the employee’s position would be compelled to resign.

Employment contracts and arbitration clauses 

Some employment contracts include arbitration clauses, which means that disputes, including those about sexual harassment, must be resolved through arbitration rather than through the court system. While these clauses can sometimes be seen as favoring employers, they can also result in settlements for victims.

Breach of contract or breach of duty

If an employer fails to uphold certain contractual promises or duties regarding workplace safety and environment, they may be liable for breaching those obligations.

Systemic issues

Inman has continued to report example after example of inappropriate behavior throughout the real estate industry: embezzlement, sexual harassment, and sex trafficking. If The NYT has indeed found extensive evidence of sexual harassment and other related claims arising from those allegations, the fallout for NAR will be catastrophic.

The litigation would further bury an organization that already has three major antitrust cases on the horizon. It would put the national spotlight on NAR’s integrity, and it would put NAR’s leadership team and its ability to lead in question, which could potentially trigger mass resignations.