The Penalty for Neglect    Ignoring charges of harassment — or even signs of it — can lead to trouble.     For example, in 2001, the EEOC settled a $2.6 million sexual harassment lawsuit filed against Trans World Airlines. The suit charged that the airline subjected dozens of female employees to a sexually hostile work environment, failed to take corrective action, and even retaliated, after the women complained.    "Employers must act swiftly to prevent and correct" unlawful conduct, which TWA failed to do, explained an EEOC attorney.

Above all, you must have a sound company policy against harassment, which includes discrimination based on sex, race, color, religion, national origin, age or disability.

Make sure your employees are aware of the policy. Spread the word through orientation sessions and your employee handbook.

Require staff members to sign an agreement indicating that they understand the policy.

At least once a year, train your employees and managers on the subject of harassment and its consequences. Employees must be told how to report incidents and feel they can without retaliation.

In some cases, you must be proactive. In one case, the EEOC said if there is sexually or racially offensive graffiti in the workplace, a company shouldn't wait for a complaint before erasing it.

To protect your company after a harassment complaint, here's a checklist to help conduct a thorough investigation:

Listen to the complaint but stay neutral and don’t validate the accusation.

Take down a statement in writing and ask the employee to initial it for accuracy.

Assure the employee that you will take action.

Discuss the problem with legal counsel.

Meet with key individuals and investigate the complaint (or hand the inquiry over to a neutral third party).

Don’t confine the investigation to the single incident. For example, does the alleged harasser have a history of similar behavior in the past?

Take appropriate action if you determine harassment did take place, including a warning, disciplinary action, demotion, transfer or dismissal. Carefully document your findings.

Institute additional training if your investigation uncovers a pattern of harassment or ignorance about the subject.

Even after conducting a thorough investigation and taking appropriate action, an employee may still sue the company. But the seriousness of your inquiry, along with a comprehensive policy and adequate training, can help convince the court that you did everything possible to provide a harassment-free workplace.