EEOC to Executives: “No” Means “No” (and Not “Fire Me”)

On September 29, 2021, the U.S. Equal Employment Opportunity Commission (“EEOC”) filed a complaint against Maryland-based Key Management Partners, Inc., alleging that the company’s CEO fired an attorney because she repeatedly spurned his advances.

EEOC alleges that Key Management Partners hired Jocelyn McKenzie in 2017 to work on a Freedom of Information Act team assisting the U.S. Department of Agriculture.  In 2019, the owner and CEO of Key, Kehinde “Kenny” Pedro, invited McKenzie to a private meeting, and asked the staff member who would normally attend the meeting not to.  After the meeting, which made McKenzie “uncomfortable,” Pedro called McKenzie on her personal phone, stating that he wanted to see her again in person.  McKenzie ended the call and informed her team lead of the conduct.

A day later, Pedro called again, attempting to convince McKenzie to have an affair with him, stating they could “work around” his wife and her boyfriend, and that, because McKenzie did not work directly with him, it was “okay.”  McKenzie told Pedro that she was not interested, did not want to be his mistress, and wanted to keep things between them strictly professional. The next day, McKenzie wrote an email to Pedro, politely declining his proposal:

“I’m responding to you via email because I prefer that you do not continue to contact me on my personal cell phone. You are my employer, and as I stated before, I enjoy working for your company. However, I expect that you will keep future interactions with me, strictly professional. The disclosures you made during the telephone calls to my cell phone were not invited nor welcome and, frankly, made me uncomfortable. I find it inappropriate, especially considering that I told you that I’m in a relationship and you confirmed that you are married. Thank you for your understanding and for respecting my boundaries.”

On May 30, 2019, Key fired McKenzie on Pedro’s orders, claiming that it terminated her because of her poor performance and because USDA did not want her to work on the contract.  At no point over the previous three months had McKenzie dipped below Key’s target closure rates, and her performance had been the same or better since she had rejected his advances.

When McKenzie applied for unemployment benefits, Key took the position that McKenzie had been terminated for “gross misconduct.”  However, Petro conceded at the unemployment hearing that USDA had not asked that McKenzie be removed from the team.  The Maryland Department of Labor ruled in McKenzie’s favor.  In August 2019 she received a job offer for another contractor position, contingent on passing a background check.  However, due to the negative reference from Key, her interim clearance was denied, and she was unable to start work until she received a full clearance over a year later.

The EEOC is pursuing sexual harassment and retaliation claims against Key.  EEOC alleges in the complaint that McKenzie experienced unwelcome sexual harassment that culminated in an intentional, retaliatory termination by the company after McKenzie rejected Pedro’s advances.  In addition to McKenzie’s damages, the EEOC argues that Key should be required to institute sexual harassment and discrimination training and to appoint an experienced ombudsman to investigate other potential claims at the company.

If the allegations in the suit are accurate, it provides a wealth of “lessons learned.”  Obviously, executives should not proposition subordinate employees and then fire them if they refuse.  But, even in more nuanced situations, relationships with subordinates expose the executive and the organization to substantial liability.  The subordinate employee could claim the relationship was not consensual or that she suffered retaliation when she ended the relationship.  And, increasingly shareholders have brought suit against publicly-traded companies, their executives and even outside counsel, for the failure to detect, properly investigate and address sexual harassment by executives.