Third-Party Harassment: When Customers Cross the Line
After years of advising employers on workplace harassment issues, one thing becomes clear: some of the most challenging situations involve people who don’t actually work for the organization.
Consider a longtime customer who repeatedly makes inappropriate comments to an employee. The employee raises the concern with her manager, who sympathizes but is reluctant to confront an important customer. Instead, he suggests she avoid the customer whenever possible. Weeks later, the behavior continues, and the underlying issue remains unresolved.
This is an example of third-party harassment, which occurs when inappropriate conduct comes from someone outside the organization, such as a customer, client, vendor, or contractor. From an employment law perspective, the central questions are what the employer knew about the conduct and how it responded. When harassment involves third parties, those answers can have significant legal implications.
Understanding how third-party harassment arises, when employers may be held responsible, and what an appropriate response looks like can help organizations address these situations before they escalate.
Third-party harassment can include verbal abuse, unwanted sexual attention, discriminatory comments, or threatening behavior involving customers, clients, vendors, and other individuals employees encounter through their work. The conduct may occur in person, over the phone, or through email and virtual meetings. The conduct may or may not rise to the level of being unlawful harassment.
Customer harassment may involve anything from repeated offensive comments to unwanted physical contact. Recognizing these behaviors helps employees and managers identify concerns that require attention.
A customer repeatedly insults a retail employee, makes degrading remarks about their intelligence, and threatens to complain to management unless the employee is fired.
An isolated rude interaction may not constitute unlawful harassment, especially if not related to or on account of the employee’s protected characteristic (e.g., sex, age, race). However, threatening or abusive behavior can raise workplace safety and conduct concerns that warrant a response.
A restaurant patron repeatedly comments on a server’s appearance, asks personal questions, and makes unwanted sexual advances. The employee has already told a manager that the customer makes them uncomfortable.
In another setting, a client regularly makes offensive remarks about an employee’s race or national origin during business meetings.
Employers should take both of these concerns seriously, even when addressing the behavior means having a difficult conversation with a valued customer or client. Failing to address these concerns when a protected characteristic is at play, could be a basis for a punitive damages claim against an employer who knowingly chooses not to address unlawful harassment.
Third-party harassment may also involve unwanted touching, intimidating gestures, or conduct that interferes with an employee’s movement.
It can also include a customer displaying sexually explicit images during a meeting or sending inappropriate materials through a work-related communication channel.
Employers should have procedures for addressing these incidents, including situations where an employee’s immediate safety may be at risk.
Not every difficult customer interaction constitutes harassment. Employees need to recognize when a customer’s behavior has crossed a workplace boundary, while managers need to understand when a concern warrants attention. Repeated unwelcome comments, personal targeting, or threatening behavior may signal a problem that should not be dismissed as simply part of working with customers.
An employee may notice that a customer repeatedly requests to work with them or makes increasingly personal comments. These experiences may seem isolated until the employee or manager recognizes a pattern.
Previous complaints can be particularly important. Managers should consider whether the same customer has been involved in earlier incidents and whether the conduct targets an employee’s protected characteristics or raises safety concerns.
Customer-facing employees are expected to handle complaints professionally, but that expectation should not extend to tolerating unlawful harassment or threats. Employees should feel comfortable reporting behavior that makes them uncomfortable or raises concerns about their safety, without having to determine whether it meets a legal definition of harassment. It is the job of Human Resources (“HR”) to make that determination.
Managers need to take those employee complaints seriously, even when the behavior does not clearly violate the law. A customer who repeatedly singles out an employee or continues inappropriate comments after being asked to stop, may require intervention before the situation escalates to the level of being unlawful harassment.
From an employment law perspective, an employer’s response becomes particularly important when it knows, or should know, about potentially unlawful harassment. Failing to take prompt, appropriate corrective action can expose the organization to liability, regardless of whether the person engaging in the conduct is not an employee.
Complaints involving longstanding clients can put managers in an uncomfortable position, especially when the customer relationship is commercially important. The following scenarios illustrate how these situations can develop.
A hotel employee reports that a frequent guest has made repeated sexual comments and attempted to touch her. Her supervisor suggests avoiding the guest when possible because he is a valuable customer.
Despite her efforts to avoid him, she continues encountering the guest during her shifts, and the behavior escalates. By placing the responsibility on the employee to avoid the guest, the supervisor failed to address the underlying conduct. As a result of this failure to act, the employer could face legal exposure if the employee files a complaint and it is determined that the conduct constitutes unlawful harassment yet the employer’s response was inadequate.
An employee tells HR that a client has repeatedly made discriminatory jokes during virtual meetings. Other employees have heard the comments, but no one has raised the issue with the client.
HR may need to review meeting records, speak with those involved, and work with the appropriate business leaders to establish expectations for future interactions.
When an employee reports harassment by a customer, the organization needs to conduct an appropriate investigation into the circumstances as it would if it were a complaint about employee conduct.
Employees should know where to go to report customer harassment. Managers should follow established escalation procedures to promptly address employee concerns.
A manager’s first response matters. Dismissing an employee’s concern as simply part of dealing with customers can discourage further reporting and leave inappropriate behavior unaddressed. Managers should listen to the employee, document the concern, and promptly involve HR rather than attempting to resolve potentially serious harassment allegations on their own.
Once notified, HR can assess the circumstances, review available information, and determine appropriate next steps. Depending on the situation, this may involve an investigation, immediate protective measures, or consultation with Legal or Security.
Under federal law, an employer may be liable for unlawful harassment by third parties who are not employees when it knew or should have known about the conduct and failed to take prompt, appropriate corrective action. It is the same standard as if the unlawful harassment were by employees.
Organizations may need to communicate directly with a customer about unacceptable behavior. Depending on the situation, appropriate measures could include changing how interactions are managed, restricting the customer’s contact with employees, or ending the customer relationship.
Employees should not be required to confront someone who poses a harassment risk. Responsibility for addressing the conduct should rest with the appropriate organizational representatives and not with the targeted employee.
Preventing third-party harassment requires employers to consider the risks associated with customer-facing work. Clear reporting procedures and manager preparation can help organizations address concerns before inappropriate conduct continues or escalates.
Anti-harassment policies should make clear that inappropriate conduct by customers, clients, and other external parties is not exempt from workplace standards.
Employees need reporting channels, including an alternative when their immediate manager dismisses a concern or is otherwise unable to address it. Customer-facing organizations may also benefit from communicating conduct expectations to clients and establishing procedures for handling client incidents.
Training should help employees recognize inappropriate customer behavior, understand workplace expectations, and know how to report concerns. Managers need additional preparation because they may be the first to hear about an incident and may also be responsible for maintaining the customer relationship. Managers are also potentially liabile and/or will cause the company to be liable if they fail to act appropriately to end the harassment.
Realistic training scenarios give employees and managers an opportunity to practice responding to situations they may encounter at work. An employee might receive an offensive comment from a customer or feel uncomfortable working alone with a particular client. Managers can practice recognizing when these concerns require attention, how to respond when an employee reports an incident, and when to involve HR.
These situations can be particularly challenging when managers are also responsible for maintaining the customer relationship. Training should prepare them to recognize when that relationship is affecting their response, understand when immediate protective measures may be necessary, and involve HR before inappropriate conduct continues.
Organizations reviewing how to prevent workplace harassment should consider whether their policies and training adequately address third-party conduct.
Employers should review where employees may be particularly exposed to inappropriate customer behavior. Working alone, handling emotionally charged interactions, or regularly meeting clients outside the workplace may call for additional safeguards.
From an employment attorney’s perspective, recurring complaints deserve particular attention. When several employees report concerns about the same customer, HR should examine what management knew, how earlier incidents were handled, and whether additional steps are needed to prevent the behavior from continuing. These patterns may also reveal weaknesses in reporting procedures or gaps in manager preparation.
Employees should not have to navigate harassment from customers, clients, or other third parties without organizational support.
Employers need to ensure that employees understand their reporting options and that managers are prepared to respond when concerns arise. This includes recognizing how third-party conduct can constitute another type of workplace harassment and understanding when HR needs to become involved.
SHIFT’s attorney-developed harassment prevention training helps organizations prepare for these situations through realistic workplace scenarios. Employees learn to recognize inappropriate conduct and understand their reporting options, while managers receive guidance on responding to harassment concerns, including those involving customers and other individuals outside the organization.
Want to learn how SHIFT can help your organization prepare employees and managers to recognize and respond to third-party harassment? Let’s talk.
No. Third-party harassment may involve sexual conduct, discriminatory remarks, threats, or other inappropriate behavior related to any protected characteristic. Whether conduct violates employment law depends on the circumstances and applicable legal standards.
Employees may worry that reporting a customer will affect their schedules, income, performance evaluations, or relationships with management. Clear reporting procedures and consistent follow-through can help address those concerns.
A bystander can report what they observed and provide factual information to a manager or HR. Depending on the circumstances, they may also be able to support the affected employee or seek immediate assistance. Employees should prioritize safety rather than confront a threatening individual.
Employers should address third-party conduct in their harassment policies and provide practical training on recognizing inappropriate behavior. Managers and employees, alike, also need clear escalation procedures and guidance on involving HR when customer conduct raises concerns.
U.S. Equal Employment Opportunity Commission. (n.d.). Harassment.
https://www.eeoc.gov/harassment
U.S. Equal Employment Opportunity Commission. (n.d.). Small business fact sheet: Harassment in the workplace.
https://www.eeoc.gov/small-business-fact-sheet-harassment-workplace
U.S. Equal Employment Opportunity Commission. (n.d.). Who is protected from employment discrimination? https://www.eeoc.gov/employers/small-business/3-who-protected-employment-discrimination
SHIFT HR Compliance Training. (n.d.). How to prevent workplace harassment.
https://shiftelt.com/resource/how-to-prevent-workplace-harassment/
SHIFT HR Compliance Training. (n.d.). Types of workplace harassment.
https://shiftelt.com/resource/types-of-workplace-harassment/
SHIFT HR Compliance Training. (n.d.). Sexual harassment prevention training.
https://shiftelt.com/courses/sexual-harassment-prevention-training/