The cost of sexual harassment to businesses


The cost of sexual harassment to businesses

…experts says they are both organisational and individual

Business reporter

Wednesday, December 04, 2019

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With the recent tabling of the Prevention of Sexual Harassment Bill by Government, much talk has ensued on the topic including the impact or cost of this long-standing phenomenon to businesses.

Speaking at this week's Jamaica Observer Monday Exchange held at its Beechwood Avenue offices, David Wan, president of the Jamaica Employers' Federation (JEF), told journalists that the issue in question does in fact pose a big problem for businesses. He stated that the fact that sexual harassment does not impact the bottom line of businesses in a positive way, it therefore becomes an issue which must be minimised.

“Any activity in a company that doesn't increase revenue and gives expenses is considered something that will have to be minimised as it is not adding to the value of the company's business,” he shared.

Regarding the issue of productivity, Wan asserted that outside of direct cost, sexual harassment also impacts the resources and efficiency of the company. He reasoned that in the extent where employees are put on leave (to facilitate investigation processes) companies will be faced with the cost of having to find suitable replacements whilst paying individuals out on leave.

“Lots of resources will be expended without any further service to the company,” he commented.

He further cited the damage to the company's reputation as another significant cost that will have to be borne by the company.

“When this news gets out, this may deter the number of ladies who want to work in a particular company, based on perception. Do you think a lot of ladies will want to work at XYZ..? I think some of them are going to think twice. Hence, your reputation is questioned and if you have a good public profile, you don't want this,” he said.

With studies undertaken in the United States showing millions — with estimated averages of US$22,500 — worth in damages per employee, this phenomenon, which decreases profitability, market capitalisation, returns on assets and capital and stock market performance, is one which many argue must be urgently addressed as it does more harm than good.

“Sexual harassment causes tremendous damage to employees who experience it, leading to higher employee turnover, lower employee productivity, increased absenteeism, and increased sick leave costs for companies,” a portion of one study emphasised.

Rosemarie Voordouw, associate counselling psychologist and public relations chair of the Jamaican Psychological Society (JamPsych) agreed that this phenomenon carries organisational as well as individual costs.

“There are a lot of costs before it reaches the point where somebody stands up and puts up a hand to say, 'I need something to be done about this!'

“When an accusation is made and swept under the carpet, there are huge costs. There are individual cost in terms of post-traumatic stress disorder, which results in people getting ill, and persons exposed to harassment become de-motivated at an organisational level. Companies lose money because of all the psychological and physical impacts on employees who are being harassed — the harasser is also not that much productive if they are spending time harassing people,” she said.

She commented that the matter in general is just one that is bad news all around, both for company as well as individuals.

“When it is known that this happens it's like this huge gorilla in the room. You have the attrition for the people who refuse to put up with it, followed by all the de-motivation and disinterest that comes for companies,its just bad news all around,” she stated.

Sharon Coburn Robinson, senior director in the Bureau of Gender Affairs at the Ministry of Culture, Gender, Entertainment and Sports (MCGES) also highlighted the wider issue of a toxic work environment. This she said is created in instances where third parties in the workspace becoming affected from what is happening.

“You may not be the receiver of, but there is somebody or a group of persons in your space who are affected and, in turn, you become affected. This is poison or toxic environment which is the other form of sexual harassment outside of the quid pro quo or tit for tat – which everybody knows about. The other is more silent and can be very deadly as the psychological impact is great,” she said.

Kwame Gordon, attorney-at-law and partner in the firm Samuda and Johnson, in providing legal opinions to the discourse, said that the recently tabled Bill is a good start in addressing the matter of sexual harassment especially as it relates to the workplace. He thereby urged companies to start from now in commencing training sessions to get staff ready for changes to come regarding this culturally pervasive issue.

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