Cost of Workplace Misconduct
There is a tendency for organizations to underestimate the all-in cost of workplace misconduct.
The sum total of all of these costs is a decline in the company's market capitalization. When the market learns about allegations of workplace misconduct or ethical lapses, the stock price reacts accordingly. The valuation of a company can fall by, literally, billions of dollars in a day depending on the facts. Shareholders are beginning to hold executives (and Board members) accountable when these situations arise.
In today's media (and social media) age, the impact that one complaint can have on a company's reputation can be devastating. Every employee has a bullhorn and can alert the marketplace to bad behaviors without the organization having a filter.
Many companies (and consumers) are increasingly proactive in 'taking their business elsewhere' in the event of misconduct or unethical business behaviors. This can be extremely damaging and costly.
When bad workplace behavior occurs, one of the most substantial ramifications is a decline in employee productivity. Not only do the employees involved in the situation become less effective, but the 'water cooler' chat kicks in and productivity declines.
Employees who have been subjected to bad behavior are more likely to look for other opportunities. When these issues become endemic within an organization, overall turnover rates increase.
Just as turnover increases, Glassdoor reviews suffer and the organization finds itself having more difficulty attracting new recruits. This is a particularly big issue if the misconduct has generated attention in the media.
Fines from regulators are the most direct and quantifiable costs of workplace misconduct and business ethics lapses. Surprisingly, in many cases fines represent a small percentage of the overall cost.
Litigation expenses are another direct cost of bad workplace behaviors and unethical business practices. Depending on the circumstances, these costs can be covered by insurance.
Employment practice liability insurance (EPLI) and Directors & Officers insurance premiums are increasing substantially in the post-#metoo era. Additionally, more insurers are denying claims, resulting in much higher out-of-pocket costs for companies with issues.



This table below reflects publicly-available data relating to announced settlement amounts and awards. It is critical to understand that these costs typically reflect a small portion of the overall costs these organizations incur when workplace misconduct and business ethics issues arise. The market capitalization losses that shareholders suffer can reach billions of dollars.
Announcement Date | Organization | Dollar Amount | Type | Category | Source | Comments |
---|---|---|---|---|---|---|
12/3/2019 | Alki David | $58,000,000 | Sexual Harassment | Workplace Conduct | Time Magazine | Alki David was hit with more than $58 million in damages after a jury found him liable for battery, sexual battery and sexual harassment against a former employee in the latest lawsuit targeting the owner of several media companies. |
12/2/2019 | State of Iowa | $900,000 | Sexual Harassment | Workplace Conduct | Des Moines Register | The State of Iowa agreed to settle complaints about a since-fired state Department of Revenue employee who secretly made cell-phone video recordings of other male workers while they used their workplace bathroom. |
12/2/2019 | Riot Games | $10,000,000 | Gender Bias & Discrimination | Workplace Conduct | LA Times | Riot Games agreed to pay out at least $10 million to women who worked at the company in the last five years as part of a settlement in a class action lawsuit over alleged gender discrimination. |
11/25/2019 | Diversified Maintenance Systems | $750,000 | Gender Bias & Discrimination, Sexual Harassment, Retaliation | Workplace Conduct | JD Supra | Tampa-Based Janitorial Service Provider Rejected African-Americans for Jobs and Punished Black Employee for Opposing Discrimination. |
11/22/2019 | Creedle Enterprises (McDonald's franchisee) | $340,000 | Sexual Harassment | Workplace Conduct | Insurance Journal | Creedle settling with the EEOC regarind eight women who worked for the company who were subjected to sexual harassment. Two male employees, one of whom was the general manager, subjected the female employees to physical touching, sexual jokes and the display of pornographic images. |
11/22/2019 | Mid Dakota Clinic | $2,100,000 | Racial Bias & Discrimination, Retaliation | Workplace Conduct | Bismarck Tribune | Doctor claimed he was unjustly fired the year before for speaking out against alleged racial discrimination against an Indian-American physician at the clinic. |
11/21/2019 | Crossmark, Inc. | $2,650,000 | Discrimination | Workplace Conduct | EEOC | CROSSMARK allowed employees who prepared and served food samples to shoppers to sit on stools for no more than ten minutes every two hours, regardless of their medical conditions or restrictions. |
11/20/2019 | Fort Bend County | $350,000 | Discrimination | Workplace Conduct | Fisher Phillips | Former employee pursued a religious discrimination claim, and a Texas federal jury recently ordered her former employer to pay her $350,000. |
11/19/2019 | Bureau of Alcohol, Tobacco, Firearms | $450,000 | Racial Bias & Discrimination | Workplace Conduct | ABC News | A supervisor for the Bureau of Alcohol, Tobacco, Firearms and Explosives in Seattle is receiving a $450,000 settlement after complaining of racial harassment from a co-worker with a Nazi tattoo. |
11/18/2019 | Dollar General | $6,000,000 | Racial Bias & Discrimination | Workplace Conduct | EEOC | Dollar General violated federal law by denying employment to African Americans at a significantly higher rate than white applicants for failing the company's broad criminal background check. |
11/12/2019 | Nabors Corporate Services and C&J Well Services | $1,200,000 | Discrimination | Workplace Conduct | EEOC | Discriminated against black workers, subjecting them to a hostile work environment, denying them high paying jobs, and retaliating against those who complained. |
11/8/2019 | Breakthru Beverage Group Illinois | $950,000 | Discrimination | Workplace Conduct | Bloomberg Law | Discriminated against sales employees based on national origin or race. |
10/30/2019 | St. Louis Police Department | $20,000,000 | Discrimination, Retaliation | Workplace Conduct | NPR | A jury awarded nearly $20 million to a police sergeant who said the St. Louis County Police Department discriminated against him based on his sexuality and then retaliated against him for filing a complaint. |
10/29/2019 | UBS Financial | $1,633,019 | Gender Bias & Discrimination | Workplace Conduct | Barrons | Arbitrator found that UBS and Carona’s former boss, James Ducey, damaged her career by treating her differently from male colleagues and retaliated after she repeatedly complained to HR. |
10/19/2019 | La Cantera Resort & Spa | $2,625,000 | Discrimination | Workplace Conduct | Law.com | Discriminated against Hispanic banquet staff and subjected them to a hostile work environment by prohibiting them from speaking in their native language, Spanish. |
10/15/2019 | Walmart | $5,200,000 | Discrimination | Workplace Conduct | Disability Scoop | Walmart failed to accommodate an employee with a developmental disability. |
10/1/2019 | Ford Motor Company’s Kentucky Truck Plant | $540,000 | Discrimination | Workplace Conduct | Auto News | Failed to hire applicants due to their disabilities. |
9/27/2019 | Barclays | $6,000,000 | FCPA / UKBA | Business Ethics | Compliance Week | Barclays hired relatives of government officials in order to influence them. |
9/23/2019 | Entertainment Benefits Group | $925,000 | Discrimination & Sexual Harassment | Workplace Conduct | Bloomberg Law | Classwide disability bias, sexual harassment. |
9/19/2019 | Mercy General Hospital | $570,000 | Discrimination | Workplace Conduct | Sacramento Bee | Fired an employee suffering from vision loss. |
9/18/2019 | Marquez Brothers | $2,000,000 | Discrimination | Workplace Conduct | Business Journal | Black, white and Asian non-Spanish-speaking job applicants were passed over for less qualified Hispanic applicants. |
9/17/2019 | UPS | $2,250,000 | Discrimination | Workplace Conduct | HR Dive | Refusal to provide light duty as an accommodation to pregnant workers violated the Pregnancy Discrimination Act (PDA). |
9/10/2019 | Connections CSP | $550,000 | Discrimination | Workplace Conduct | EEOC | fired employees with disabilities who needed additional unpaid leave beyond the required 12 weeks under the Family and Medical Leave Act (FMLA). |
8/29/2019 | Hudson City Savings Bank | $1,000,000 | Retaliation | Workplace Conduct | National Law Review | Woman was retaliated against after reporting gender discrimination. |
8/22/2019 | Deutsche Bank | $16,000,000 | FCPA / UKBA | Business Ethics | Wall Street Journal | Deutsche Bank hired relatives of government officials in order to influence them. |
8/20/2019 | LA Times | $22,000,000 | Discrimination | Workplace Conduct | Washington Post | A former L.A. Times sports columnist was awarded $15.4 million ($22mm including interest) in age-related discrimination case. |
8/9/2019 | Juniper Networks | $11,700,000 | FCPA / UKBA | Business Ethics | Compliance Week | Juniper Networks' Russian subsidiary secretly funded leisure trips for customers, including government officials. |
8/6/2019 | Dartmouth College | $14,000,000 | Sexual Harassment | Workplace Conduct | CNN | Female students were routinely subjected to rape and sexual harassment. |
7/22/2019 | Microsoft | $16,000,000 | FCPA / UKBA | Business Ethics | SEC | Microsoft subsidiaries improperly handled funds in regards to foreign government officials. |
6/20/2019 | Jack in the Box | $15,400,000 | Discrimination | Workplace Conduct | My News LA | Discriminated against and harassed a manager because of her age and a physical disability. |
6/20/2019 | Walmart | $282,000,000 | FCPA / UKBA | Business Ethics | Reuters | Walmart failed to sufficiently investigate corrupt practices by its subsidiaries. |
6/13/2019 | Pogo Mine | $975,000 | Sexual Harassment | Workplace Conduct | Alaska Public Media | Underground miner was discriminated against because she is a woman. |
6/10/2019 | New Mexico Corrections Department | $700,000 | Discrimination and Retaliation | Workplace Conduct | KRWG Public Media | State prison workers were discriminated against because of their age and faced retaliation after reporting the allegations. |
6/5/2019 | JPMorgan Chase | $5,000,000 | Pay Violation | Workplace Conduct | Xpert HR | Chase employee was wrongfully denied equal paid parental leave. |
5/14/2019 | Pape Material Handling | $650,000 | Discrimination | Workplace Conduct | Fresno Bee | Allowed ongoing harassment of its Latino employees. Harassment included mocking employees’ accents and using derogatory ethnic slurs. |
4/29/2019 | Hologram USA (Alki David) | $11,000,000 | Sexual Harassment | Workplace Conduct | LA Times | Jury awards Chastity Jones in her claims of sexual impropriety. |
2/20/2019 | IHOP | $700,000 | Sexual Harassment and Retaliation | Workplace Conduct | Business Insurance | Employees at the Glen Carbon and Alton, Illinois, restaurants were routinely sexually harassed by co-workers and managers, including offensive sexual comments, groping, physical threats and, in one instance, an alleged sexual assault. |
2/14/2019 | Essence Business Group | $11,000,000 | Sexual Harassment | Workplace Conduct | Workplace Litigation Report | Supervisors harassed female employees on multiple occasions. |
2/14/2019 | Fanatics Retail Group Fulfillment | $4,900,000 | Discrimination and Retaliation | Workplace Conduct | Florida Times Union | A black employee was called a racial slur on his first day at work. When he complained later that black employees weren’t treated equally, the suit said, Perkins was told he’d never be promoted. |
2/2/2019 | KFC | $1,500,000 | Discrimination | Workplace Conduct | Xpert HR | Supervisor actions were designed to discriminate against employee needing to breast feed. |
1/30/2019 | Teva Pharmaceutical | $6,000,000 | Discrimination | Workplace Conduct | Workplace Litigation Report | Teva Pharmaceutical discrimination against employee based on age and national origin. |
1/30/2019 | Atlantic Capes Fisheries and BJ's Service Co. | $675,000 | Sexual Harassment and Retaliation | Workplace Conduct | Seafood Source | Sexual harassment was perpetrated by managers, line supervisors, and co-workers. Allegations include unwanted touching, solicitations for sex, and crude comments. |
1/6/2019 | Keyways Vinyard | $11,000,000 | Sexual Harassment and Retaliation | Workplace Conduct | National Law Review | Two former employees claimed they were sexually harassed and retaliated against for complaining about the harassment. |
12/31/2018 | CBS | $9,500,000 | Sexual Harassment | Workplace Conduct | New York Times | Settlement for Eliza Dushku over misconduct on ‘Bull’ set |
12/16/2018 | Polycom | $16,000,000 | FCPA / UKBA | Business Ethics | Radical Compliance | Polycom subidiaries facilitated improper payments to government officials. |
12/10/2018 | Cato Corporation | $3,500,000 | Discrimination | Workplace Conduct | Charlotte Observer | Discrimination against pregnant employees and workers with disabilities. |
12/6/2018 | Family Healthcare Network | $1,750,000 | Discrimination | Workplace Conduct | Fresno Bee | Implemented “rigid” practices and refused to accommodate the staff with appropriate leave, or failed to rehire them after leave. |
11/19/2018 | Vantage Drilling | $5,000,000 | FCPA / UKBA | Business Ethics | Globe Newswire | Vantage Drilling lacked sufficient internal accounting controls in relation to the heightened risk of conducting business in Brazil. |
11/12/2018 | United Technologies | $13,900,000 | FCPA / UKBA | Business Ethics | SEC | United Technologies subsidiary Otis Elevator Co. made unlawful payments to Azerbaijani officials. |
10/16/2018 | Sherwood Food Distributors | $3,600,000 | Discrimination | Workplace Conduct | Cleveland Plain Dealer | Discriminated against a class of female applicants at its warehouses in Cleveland, Ohio and Detroit, Michigan by refusing to hire them for entry-level positions because of gender. |
9/28/2018 | Stryker | $7,800,000 | FCPA / UKBA | Business Ethics | FCPA Blog | Stryker’s internal accounting controls were not sufficient to detect the risk of improper payments in foreign countries. |
7/5/2018 | Credit Suisse | $30,000,000 | FCPA / UKBA | Business Ethics | SEC | Sought to win business by hiring and promoting individuals connected to government officials as part of a quid pro quo arrangement. |
4/30/2018 | Panasonic | $280,000,000 | FCPA / UKBA | Business Ethics | CNN | Offered a lucrative consulting position to a government official at a state-owned airline to induce the official to help PAC in obtaining and retaining business from the airline. |
4/25/2018 | Fidelity National Financial | $2,200,000 | Sexual Harassment & Retaliation | Workplace Conduct | My News LA | Employee alleged during legal team retreat a manager followed her back to her room and attempted to kiss her multiple times without her consent. After reporting the behavior to Fidelity management, she suffered further harassing behavior and had to go on leave under orders from her doctor. The heads of the legal department provided no support to her. She was let go from her job in November of 2015. |
4/23/2018 | Dun & Bradstreet | $2,000,000 | FCPA / UKBA | Business Ethics | FCPA Blog | Two Chinese subsidiaries used third-party agents to make unlawful payments to obtain data vital to Dun & Bradstreet’s business. |
3/26/2018 | Kinross Gold | $995,000 | FCPA / UKBA | Business Ethics | MarketWatch | Found to have awarded a lucrative logistics contract to a company preferred by Mauritanian government officials, despite concerns that the company was a high-cost provider with poor technical capabilities, in contravention of Kinross Gold’s bidding and tendering procedures. Kinross Gold also contracted with a politically-connected consultant to facilitate contacts with high-level Mauritanian government officials without conducting required, heightened due diligence. In addition, the company paid vendors and consultants without ensuring the payments were consistent with policies prohibiting improper payments. |
3/21/2018 | Family Dollar Stores | $45,000,000 | Discrimination | Workplace Conduct | National Law Review | Fifty female managers alleged that the company had paid them less than similarly situated male store managers. |
3/19/2018 | United Airlines | $1,500,000 | Discrimination | Workplace Conduct | Westword | United Airlines lost a decision after firing two senior flight attendants for a minor infraction to make an example based on their tenure. |
3/9/2018 | Elbit Imaging | $500,000 | FCPA / UKBA | Business Ethics | Wall Street Journal | Paid millions of dollars to third-party offshore consultants and a sales agent purportedly for their services related to a real estate development project in Romania and the sale of a large portfolio of real estate assets in the U.S. Elbit and Plaza made these payments even though they lacked evidence that the consultants and the sales agent had actually provided the contracted for services. |
3/8/2018 | Beverly Fabrics | $2,600,000 | Sexual Harassment & Workplace Bullying | Workplace Conduct | Jury Verdict Alert | Plaintiff was subjected to sexual harassment by a male coworker who tormented plaintiff with homosexual slurs, spreading false rumors about plaintiff, making highly inappropriate physical contact and gestures towards plaintiff, and targeting plaintiff's heterosexual identity by using "sex" as a tool of harassment against plaintiff. Plaintiff reported the coworker's actions to his supervisors, whom plaintiff believed already knew of the conduct, ignored it, and allowed it to continue. |
3/6/2018 | Domino Sugar | $13,400,000 | Discrimination & Sexual Harassment | Workplace Conduct | New York Daily News | Employee alleged she had endured sexual discrimination and harassment by a supervisor at the sugar refinery. |
2/15/2018 | UCLA | $13,000,000 | Discrimination | Workplace Conduct | CBS | UCLA oncologist alleged she was forced to take another job after complaining about discriminatory treatment based on her gender. |
1/28/2018 | Sybron / Kavo Kerr / Danaher | $31,000,000 | Discrimination | Workplace Conduct | KFI AM 640 | Employee subjected to comments such as ``you are outdated,'' ``we need younger workers here,'' ``you are part of the old culture'' and ``dumb female.'' In addition to age discrimination, the jury found true causes of action for age harassment, wrongful termination and retaliation. |
1/4/2018 | Asian American Drug Abuse Program | $4,500,000 | Discrimination | Workplace Conduct | National Law Review | AADAP failed to accommodate her disability, and acted with malice, oppression, and/or fraud. |
12/8/2017 | Washington DC Metropolitan Transit Authority | $6,500,000 | Discrimination | Workplace Conduct | Law 360 | MTA's Metrorail's criminal background check policy disproportionately discriminated against African Americans. |
9/12/2017 | State of New Jersey | $11,800,000 | Discrimination | Workplace Conduct | Employment Law Firm Blog | Failure to accommodate a disability, discrimination based on a disability, and discrimination based on a perception of a disability under the NJLAD. |
7/7/2016 | Fox News (Roger Ailes) | $20,000,000 | Sexual Harassment, Discrimination & Retaliation | Workplace Conduct | CNBC | Employee Gretchen Carlson alleged Ailes fired her because she refused to have sex with him. Ailes made comments of a sexual nature towards Carlson, calling her a “man hater” who tried to “show up the boys.” Ailes asked Carlson to turn around in his office so he could view her “posterior,” as well as told her he has “slept” with three former Miss Americas but not with her. |
7/5/2017 | Metropolitan Life | $32,500,000 | Discrimination | Workplace Conduct | Insurance Business | Firm alleged to have maintained “a racially biased corporate culture and stereotypical views about the skills, abilities, and potential of African Americans that affect personnel.” |
6/29/2017 | McWane, Inc. | $16,600,000 | Discrimination | Workplace Conduct | The Press Enterprise | Employee was discriminated against because of his race and that his employer failed to prevent his mistreatment. |
6/15/2017 | Los Angeles Department of Sanitation | $17,400,000 | Discrimination, Retaliation, andWorkplace Bullying | Workplace Conduct | New York Post | Employee alleged he endured repeated harassment by supervisors, who falsely perceived that he was gay. He was subjected to verbal abuse, hazing and a bullying campaign in which his portrait was altered to show him in a same-sex relationship with a subordinate. |
2/16/2017 | Bureau of Prisons | $20,000,000 | Sexual Harassment and Discrimination | Workplace Conduct | Quartz | Bureau of Prisons agreed to pay women who were sexually harassed by inmates at prison in Florida. |
1/31/2017 | Lockheed Martin | $51,400,000 | Discrimination | Workplace Conduct | National Law Review | Employee alleged he was selected for layoff at 66 while two other employees holding same title, both significantly younger, were allowed to keep their jobs. He also alleged that the company had a practice of giving younger workers better reviews and raises to keep them at the company, while older workers were given lower ratings and raises since they “had nowhere else to go.” |
1/18/2017 | United States Secret Service | $24,000,000 | Discrimination | Workplace Conduct | CNN | Alleged that the federal agency denied job opportunities because of race. |
1/3/2017 | Wells Fargo Advisors | $35,000,000 | Discrimination | Workplace Conduct | Advisor Hub | Alleged that African American brokers and trainees were denied business opportunities, excluded from high-producing teams because of their race. |
8/28/2013 | Merrill Lynch | $160,000,000 | Discrimination | Workplace Conduct | Reuters | Alleged to have segregated the workforce, including policies that steered black brokers into clerical positions and reassigned their accounts to white workers. |
8/10/2012 | Washington D.C. Department of Parks & Recreation | $3,500,000 | Sexual Harassment & Retaliation | Workplace Conduct | Washington Post | Employee alleged her supervisor began to harass her by asking her on dates and whether she “had a man.” When she rebuffed the supervisor’s advances, the harassment intensified, the lifeguard’s attorneys alleged. She reported the behavior to a half-dozen supervisors but the harassment did not stop. Shortly after filing a written complaint in October 2006, she was fired. |
6/29/2012 | Yellow Transportation and YRC, Inc. | $11,000,000 | Discrimination | Workplace Conduct | EEOC | Based on consent decree. Subjected African-American employees to a racially hostile environment and discriminatory terms of employment. |
6/13/2012 | ArcelorMittal | $25,000,000 | Discrimination | Workplace Conduct | Industry Week | Federal court jury awards $25 million in damages to a steel plant employee. |
3/2/2012 | Mercy General Hospital | $168,000,000 | Sexual Harassment | Workplace Conduct | ABC News | Federal court jury awarded former cardiac surgery physician assistant $125 million in punitive damages, $39 million for mental anguish and $3.5 million for lost wages and benefits. |
12/8/2011 | Dr. Pepper | $18,300,000 | Discrimination | Workplace Conduct | Twin Cities Pioneer Press | Jury award based for allowing a manager to discriminate against older delivery drivers and for disability discrimination by failing to accommodate a driver’s disability. |
7/6/2011 | Verizon | $20,000,000 | Retaliation | Workplace Conduct | EEOC | Verizon unlawfully denied reasonable accommodations to hundreds of employees and disciplined and/or fired them pursuant to “no fault” attendance plans. |
6/10/2011 | Aaron's, Inc. | $45,000,000 | Sexual Harassment & Retaliation | Workplace Conduct | Reuters | The plaintiff alleged that a manager sexually harassed and assaulted her during her employment at Aaron's Rents. |
5/3/2011 | UBS Financial | $10,600,000 | Sexual Harassment & Retaliation | Workplace Conduct | Bloomberg Law | Employee complained of harassment in 2008, then UBS fired her. Alleged harassment by her supervisor had been ongoing for six years. Complainant alleged supervisor “repeatedly made inappropriate comments about Ingraham’s breast size”, called her into his office to “view sexually offensive emails on his computer”, repeatedly “talked about the size of his genitals”, and asked her about her sexual fantasies. |