Retail is one of Hong Kong’s most important industries and a key provider of all levels of employment opportunities. Most major international retailers have offices in Hong Kong, and leading international designers and high street brands are represented in the country’s many retail malls. However, this environment is now fraught with legal difficulties following Hong Kong’s amendments to its laws on Sexual Harassment (under the Sex Discrimination Ordinance) in December 2014.

Prohibitions against the sexual harassment of one employee by a colleague are well established, but these new amendments protect staff in the services and retail sectors from sexual harassment by customers. The implication for employers is that liability for harassment by a customer may pass to them if they fail to address it. Such liability might be embarrassing or might negatively impact future business. Action should be taken now to deal with the issue of inappropriate behavior by customers.

I was only being friendly

The boundaries between personal and professional lives (driven in part by the prevalence of social media) are increasingly blurry; in such a landscape, sexual harassment between customer and retail employee can easily arise. The law generally recognizes harassment as unwelcome or uninvited sexual behavior which is viewed as offensive, humiliating or intimidating. At its most obvious, harassment could be an unwelcome sexual advance by a customer to an employee, but harassment can take much more subtle forms, such as creating an environment which one person views as hostile. The unwelcome behavior does not need to be repeated or continuous; depending on the circumstances, a single incident can be sufficient to constitute sexual harassment.

Common examples that employers may be required to deal with include:

  • sexual comments, including those made in jest or as innuendo
  • unwelcome requests for sex (even if the individual believes this is welcomed by the recipient) or
  • physical contact, even if the person doing the touching believes it to be innocuous Most people recognize that such conduct between two employees would give rise to an internal employment issue. But making customers liable for such behavior is a potential headache for managers overseeing staff (such as sales assistants) who deal with customers on a daily basis. In an environment where customer satisfaction is paramount, it will no longer be possible for retailers to hide behind the “customer is king” mantra and ignore the risk that customers are harassing their staff.

Employer’s liability

A customer accused of harassment would be personally liable to the individual. S/he may also be guilty of a criminal offense (for example if the harassing behavior comprized indecent assault or indecent exposure). However, if an employee reports sexual harassment by a customer, and the employer either ignores this or fails to prevent future unwanted attention, then the employer could also be liable.

Further, if an employer tries to prevent an employee from bringing a complaint of sexual harassment against a customer, or treats the employee less favorably because of such complaint, then the employer may be liable for discriminating against that employee by way of victimisation.

Additionally, an employer may be vicariously liable for acts of sexual harassment committed by its employees as customers. For example, if a company representative inappropriately touches a flight attendant during a business trip, or an employee who is employed as a buyer makes lewd and sexist comments towards a representative of the company with whom s/he is dealing, the company may be vicariously liable for the act of their employee. This is irrespective of whether or not the act is done with the company’s knowledge or approval.

Five practical tips

To avoid liability, companies should:

  • make clear to staff what behavior is inappropriate (via staff policies, compliance manuals and complaints systems);
  • update or implement a comprehensive anti-harassment policy, stating that any act of sexual harassment will not be tolerated, and informing victims of sexual harassment of their right to make a complaint without fear of reprisal;
  • investigate complaints promptly, and in accordance with the anti-harassment policy;
  • train all staff on the recent changes. Supervisors and managers should be particularly alert to potential customer harassment; and
  • in the case of a persistent problem, consider refusing the customer future access to the store, or demanding an alternative representative is sent from the customer’s company.