#MeToo, diversity, gender, management liability, employment practices insurance, D&O, directors and officers insurance

What are the #MeToo implications for insurance clients?

Regardless of your individual opinion on the #MeToo movement, it continues to be headlining news and is causing policymakers and business leaders to change the way they view things like bullying, discrimination and harassment. All of these factors can result in an increase in employment and reputational risk, so we thought it was worth examining how these trends could impact our clients, their risk management practices and insurance solutions.

What is the #MeToo movement?

The #MeToo movement is a movement against sexual harassment and sexual assault. The movement spread virally in October 2017 as a hashtag on social media to demonstrate the widespread prevalence of sexual assault and harassment, especially in the workplace.  (Source: Time)

Greater Awareness and Reporting of Sexual Harassment

The Human Rights Commission study last year found that almost two in five women (39%) said they had experienced sexual harassment in work, up from 25% in 2012. And 26% of men have experienced sexual harassment at work according to the study.

Australia conducted public hearings in a national inquiry into sexual harassment in the workplace – a process billed as a ‘world first’ response to the #MeToo movement that aimed to raise public awareness and recommend new rules.

What are the insurance implications of #MeToo?

While employment-related risks have traditionally been considered an ‘HR problem’, the increased awareness means these issues are now on the radar of leadership teams and boards as well. This is similar to the awareness around cyber risk, which is no longer just the responsibility of your IT provider or IT team.

With the increased examples of litigation, we’re also seeing an increase in demand for employment practices liability insurance to help protect companies from the cost of defending claims. The Victorian Equal Opportunity & Human Rights Commission has reportedly seen an increase of 32% in enquiries and complaints regarding sexual harassment compared to the previous year.

This is having a knock-on effect of insurers/underwriters taking a look at potential clients’ risk mitigation programs, such as making sure they’re fostering the right kind of culture with diversity and inclusion policies and employee training on harassment and bullying as well as unconscious bias.

Previously most companies of 5 or more people might have an employee handbook with policies and procedures off the shelf and that would cover off your requirements and obligations. These days, the question is not whether you have policies and procedures but what you DO with them that counts. How are you sharing this information with your employees? Do you get them to sign off on your code of conduct (especially in regards to harassment)? How are these policies and procedures enforced?

With an increase in lawsuits on harassment and assault, insurers and underwriters may look to use pricing as either a carrot to improve your workplace practices or a stick if you don’t.

What can you do to help protect your business?

Here are 6 key actions your business can take to help reduce your risk of an issue in your workplace:

  • Nip bad behaviour in the bud – foster an environment of teamwork and respect, and don’t tolerate employees who treat other employees as though they are beneath them, even if their aggression isn’t overtly sexual. Some companies struggle with a scenario where the offender is also a star performer, but this shouldn’t change your response as that person is ultimately putting you at risk and undermining the type of culture and business you’re trying to build.
  • Openly encourage people to speak up when they notice a problem, even if it didn’t involve them directly – some businesses enlist a ‘designated witness’ similar to the idea of a ‘designated driver’ to keep an eye out for bad behaviour and address it before it gets out of hand. For example, if someone makes an inappropriate joke during a meeting, the witness could pull the person aside privately to talk about why their behaviour isn’t acceptable.
  • Diversity works – sexual harassment is a power move, but you can change that power dynamic with a healthy balance of diversity. Not just gender diversity, but diversity in background, education, thinking, and personality. And not just at your entry level roles, but at the leadership level of your business. For example, if you have to go to a woman for your budget, you’re much less likely to disrespect someone in that position of power.
  • Up to date policies and training – and more training. Emailing your people the employee handbook is about as effective as a cat door in an elephant house. People learn through a variety of different ways, so use different methods to bring your culture to life, whether it’s video, role play in face to face training, pop quizzes, or bringing in engaging speakers.
  • Manage complaints – this is when your company is tested on whether or not you are serious about your policies. Some companies talk about a ‘zero tolerance’ for harassment or bullying but the first instance they’re presented with they sweep it under the rug. Every complaint should be investigated following a clear, consistent and thorough process.
  • Treat all parties with respect – make sure you don’t jump to conclusions until your investigations have been completed in regards to the accused party, but equally make sure you look after the person making the accusation so they don’t feel overly vulnerable and exposed as this could lead to hesitation in reporting issues in the future.


If you want to talk more about your risk management or insurance solution, don’t hesitate to contact us, we’d to have a chat about your situation and help you out where we can!