Experts Question Las Vegas Casinos’ Plan to Prevent Sexual Harassment

By REGINA GARCIA CANO | March 14, 2018

In the wake of the sexual misconduct scandal surrounding Las Vegas casino titan Steve Wynn, Nevada gambling regulators are developing regulations on workplace sexual harassment, but employment attorneys who reviewed the proposed initial criteria told The Associated Press that state officials may be setting the bar too low and inadvertently hampering investigations.

Regulators notified all gambling license holders last week that they plan to enact “regulations or minimum internal control standards” focused on sexual harassment. They included a sample complaint form and a 15-question checklist of possible guidelines.

“How to appropriately address sexual harassment is an important and necessary discussion,” Nevada Gaming Control Board chairwoman Becky Harris said in a statement.

The checklist asks whether a company’s policies include an “unequivocal statement that sexual harassment will not be tolerated” and “regular compliance trainings for all employees.” It also directs companies to provide regulators with “any reported and substantiated” complaints and to report any settlements or judgments of the past 12 months on record with the Equal Employment Opportunity Commission and relevant state agencies.

The board’s move came more than a month after the Wall Street Journal reported that several women said Wynn harassed or assaulted them and that one case led to a $7.5 million settlement. Wynn, who has vehemently denied the allegations, resigned Feb. 6 as chairman and CEO of Wynn Resorts.

Joyce Smithey, an attorney based in Annapolis, Maryland, who has handled several sexual harassment lawsuits, said that while the list covers the basic elements for an anti-harassment policy, regulators are leaving too much discretion to operators on implementation.

“There are a lot of places where the employer can hide,” Smithey said. She said asking operators to report substantiated complaints, charges and settlements may inadvertently discourage companies from conducting thorough investigations to avoid more scrutiny from the board, which has the power to levy fines and even revoke gambling licenses.

“It has some disincentives to make findings and correct things,” she said.

The board, whose three members are appointed by the governor, regulates an industry that’s the backbone of the state’s economy and whose leaders, including Wynn, have become prolific political donors with undeniable influence in the state and beyond. Wynn money previously went to the campaigns of Nevada Gov. Sandoval – who previously said he was “disturbed, saddened and deeply troubled” by the allegations against the casino mogul – and Harris, formerly a state senator.

The board can impose anti-sexual misconduct policies because state regulations provide that casinos operate in a suitable way to protect “the public health, safety, morals, good order and general welfare” of Nevada residents. It can also pursue disciplinary action if licensee’s activities are discrediting of the state and its gambling industry.

Regulators in Nevada are now investigating the allegations leveled against Wynn, but were initially slow to react. Their counterparts in Massachusetts, where Wynn Resorts is building a casino, launched a regulatory review immediately after the news report was published. The Nevada board took four days to announce its investigation.

Shannon McNulty, an attorney with Clifford Law Offices in Chicago, said most mid- and large-size corporations like the ones who operate Las Vegas resorts likely already meet the board’s criteria, but smaller companies may lack formal policies.

“In employee settings that don’t have a formal human resources department, this was maybe a good first start at awareness and compliance,” she said.

MGM Resorts International told the AP that its policies “expressly prohibit” sexual harassment and has regular, mandatory training for employees and managers. The company said it offers multiple avenues for employees to report discrimination and harassment concerns, including through an ethics hotline, management and human resources.

Caesars Entertainment said each employee is educated on the company’s harassment-free policy. Supervisors and managers must complete anti-harassment training on an annual basis. Alleged violations may be reported through various channels, including a 24/7 ethics and compliance hotline.

Wynn Resorts said it has an anti-sexual harassment policy and provides “multiple channels for employees to report” alleged violations, including through an independent and anonymous hotline in place since its first casino-resort opened in 2005.

The company’s board of directors has created a committee to investigate the accusations and to review the company’s internal policies and procedures to ensure a “safe and respectful workplace for all employees.” At the same time, regulators in Nevada have set up an online form that allows people to report information on any of its active investigations.

Philadelphia-based employment attorney Jonathan Segal, who provides training for human resource professionals, said regulators are sending a strong message to licensees that they take sexual harassment seriously, but many details need to be fleshed out, including the quality of training.

He said training requirements must apply to members of a company’s board of directors, have a bystander component and be tailored to the casino industry, with guidelines that protect employees from non-employees.

“One of the levels of customization is how would someone with authority intervene if a player is acting inappropriately toward an employee?” Segal said. “I think there needs to be training on how to respond to it. The response can’t be: ‘This person is a whale or a high roller and you just got to take it.”’