Darren Huston, chief executive officer of the Priceline Group, recently resigned after a company investigation concluded that he had a personal relationship with an employee who was not under his direct supervision.
Despite the fact that the company’s performance under Huston’s leadership was strong, the independent members of the board undertook an investigation of him. The Board determined that Huston’s actions conflicted with the company’s code of conduct and that he had engaged in activities “inconsistent with the board’s expectations for executive conduct,” according to a company statement. Huston acknowledged his behavior and expressed regret, Priceline said.
Huston’s not alone. Mark Hurd left Hewlett-Packard Co in August 2010 over a controversy about his relationship with a female contractor. The board of Starwood Hotels & Resorts Worldwide Inc. forced out CEO Steven Heyer in April 2007 after looking into charges that he engaged in sexual advances toward young, female employees. Starwood took this action despite Heyer’s contention that the charges were untrue. And, two years before that Boeing Company’s directors asked CEO Harry Stonecipher to resign over his consensual extramarital affair with a female executive.
The stories underscore the need for companies to be especially sensitive to employment harassment issues. While Huston’s resignation was not directly associated with an employment harassment lawsuit, employers and boards must be constantly vigilant in order to avoid exposure to harassment claims.
As of 2013, only 42 percent of organizations had either a written or verbal policy covering office romances, according to surveys by the Society for Human Resource Management. That’s up from 28 percent in 2005, but still showcases a significant lack of focus on these issues. It’s something that I, as an employment lawyer, see as a problem.
If an executive who is as successful and powerful as Huston can be toppled from his position, all employees and their employers are vulnerable to the outcome of a charge of real or perceived employment harassment.
As an employment lawyer, I urge all employers to have strict, well-defined and well-disseminated codes of conduct and to train managers at all levels to recognize the signs of employment harassment lawsuits in the making.