New EEOC Settlement: Lessons From a $460K Sexual Harassment Payout

Female employees in Michigan said they endured ongoing sexual harassment at work – but management didn’t step in to stop it.

That’s when the Equal Employment Opportunity Commission (EEOC) got involved – and the company now faces a six-figure settlement.

This case involves East Jordan Plastics, Inc., a manufacturer of plastic horticultural containers, and three female employees who worked at a plant in Beaverton, Michigan.

Multiple Sexual Harassment Complaints Against Co-Worker

According to the EEOC, a male co-worker repeatedly harassed female employees with offensive sexual comments and unwelcome touching.

Despite at least two formal complaints to management, the company took no disciplinary action or meaningful steps to stop the behavior, the women alleged. 

They said the sexual harassment continued until another employee came forward, prompting the company to finally investigate and fire the accused.

At some point, the employees filed a charge with the EEOC.

EEOC Files Title VII Lawsuit

The EEOC stated that the company’s inaction violated Title VII of the Civil Rights Act of 1964, which requires employers to prevent harassment, promptly investigate complaints, and take corrective action when misconduct occurs. The agency also noted that failing to intervene can create an intolerable work environment, potentially exposing employers to liability for constructive discharge or retaliation.

After attempts to resolve the matter through conciliation failed, the EEOC filed a lawsuit on behalf of the women. 

“Several complaints should not be necessary to convince an employer that sexually charged misconduct is taking place and needs to be addressed,” EEOC Regional Attorney Kenneth Bird said in a press release. “An employer must take seriously the first complaint of harassment that it receives.”

Company Pays $460K

In this case, East Jordan Plastics ultimately agreed to pay a combined total of $460,000 to the women to settle out of court.

Under a three-year consent decree, the company must also provide:

• Anti-harassment training for employees and supervisors
• Annual reports to the EEOC on how sexual harassment complaints are handled, and
• Workplace notices about the settlement and employee rights.

This settlement underscores that failing to adequately respond to repeated complaints of sexual harassment can carry both financial and reputational consequences for employers.

“We applaud East Jordan Plastics for working with us promptly to reach a settlement,” Bird said after the agreement was reached. “This early resolution demonstrates a commitment to achieving a harassment-free workplace.”

HR Takeaways

For HR leaders, this case highlights practical steps to reduce risk and maintain a safe, compliant workplace:

• Ensure employees understand reporting channels and rights – Employees must know exactly how and where to report harassment. Clear communication about reporting procedures, anonymity options and non-retaliation protections sets the foundation for effective complaint handling.
• Treat every sexual harassment complaint seriously and investigate promptly – Complaints should be addressed immediately and consistently. Prompt and thorough workplace investigations signal that HR takes misconduct seriously and also reduce the risk of organizational liability.
• Take clear, documented corrective action to stop misconduct – Once an investigation confirms inappropriate behavior, HR must implement appropriate measures, including disciplinary action. All steps should be documented to demonstrate compliance and follow-through.
• Monitor compliance through training and periodic reviews – Preventive training and regular policy reviews ensure employees and managers remain aware of expectations. Ongoing monitoring helps identify gaps and reinforces a culture that does not tolerate harassment.
• Encourage a culture of accountability and transparency – Promote an environment where employees feel comfortable speaking up and managers actively model respectful behavior. Regularly communicate that harassment is not tolerated and that complaints will be taken seriously, even if informal, so issues are addressed before they escalate.

Following these steps reinforces accountability at every level and demonstrates to employees that sexual harassment complaints are taken seriously and addressed effectively.