ABSTRACT: A Committee of the Board of Directors of the Carmel Residents Association prepared a Report entitled “CARMEL’S HARASSMENT SUIT,” dated November 11, 2010, based on information provided by the City through a Public Records Act request. The Report addresses the following questions: What events preceded the settlement of Miller’s harassment suit against the city? Did the city administration follow its published procedures in managing Miller’s harassment complaints? How adequate was the city’s investigation of Miller’s complaints? What were the terms of the settlement and release agreement between Miller and the City of Carmel-by-the-Sea? How much did it cost the city to defend the lawsuit? What are the provisions regarding termination in the city administrator’s Employment Agreement? The Report is uploaded. NEW INFORMATION HIGHLIGHTS are presented.
CARMEL’S HARASSMENT SUIT
A Report Prepared for Members of the Carmel Residents Association
By a Committee of the Board of Directors
November 11, 2010
NEW INFORMATION HIGHLIGHTS:
What events preceded the settlement of Miller’s harassment suit against the city?
• On June 23, 2008, the city referred Miller’s complaints to Liebert, Cassidy, and Whitmore (LCW), the legal firm customarily retained to deal with personnel matters. LCW, in turn, subsequently engaged Karen Kramer to investigate the complaints.
Did the city administration follow its published procedures in managing Miller’s harassment complaints?
• The city’s procedures specified that if the alleged harasser was the city administrator, complaints should be addressed to the city council’s personnel committee. However no such committee existed.
• From the outset, the mayor and city council violated stated procedures that required the recipient of complaints to “Listen to the complainant’s allegations and discuss the actions complained of with discretion, sensitivity and due concern for the dignity of everyone involved.”
• Further violation of city procedures related to the requirement, “If the person alleged to be engaged in the harassment is the complainant’s supervisor, the complainant shall be removed from direct supervision of that supervisor…” Miller remained under Guillen’s supervision throughout her final months as a city employee.
• City policy also required that “Investigations will be timely and extensive as required.” As will be discussed in a subsequent section of this report, the investigation of Miller’s complaints was cursory at best. With respect to timeliness, the policy referred to acting “immediately,” which the policy suggested meant within three days. Yet, the first real action on the May 20 complaint letter was referral to the LCW law firm on June 24. Six weeks later, LCW engaged Kramer as investigator…Her billing records show further delays-she did not conduct her first investigative interview until October 30. Her final report was submitted on January 16, 2009.
How adequate was the city’s investigation of Miller’s complaints?
• In describing her investigative procedures, Kramer said that initially she would “determine whether or not I needed to obtain any documents from the complainant or the employer.” Yet in her deposition she responded, “No” to the question, “At any point in your work in this matter did you ask the city to put together all the documents relating to the claim and give them to you?”
• Later in her deposition, questions focused on Miller’s October 23 letter—the most detailed specification of her complaints. Kramer conceded that she had reviewed that letter and that it offered “definitely more detail than I had prior to that time.” Yet she responded, “I don’t think so” to the question, “… Her billing records also show that she spent 0.4 hours in total reviewing or doing any follow up on the lengthy Miller statement.
• Presumably Kramer’s investigation began with her retention in August. Yet she did not review the city’s harassment policy until October or November. She stated, “I don’t think I reviewed the policy as of October 21, 2008.” She acknowledged that she received the policy on November 10, and that it took her ten minutes to read it.
• The following exchanges in her deposition are significant:
Q. “Did you ever see any of Jane Miller’s emails?’
Q. “Did you ever see any of Rich Guillen’s emails to Jane Miller?”
• The most damning evidence against Guillen we have seen is found in the Kramer deposition transcript. In her interview with Guillen, he denied ever using the offensive statements in his emails that were cited in Miller’s complaint letters.
• Kramer interviewed a total of 12 witnesses between October 30 and December 3, 2008. According to Miller’s attorney, no more than one individual on a list of potential witnesses she submitted were ever interviewed. The persons to be interviewed were selected by city staff who reported directly to Guillen. Despite a judge’s opinion that Miller’s case shared common elements with the previously settled claims of four former employees, none of those employees was interviewed. With perhaps one exception, no other former employees were interviewed. This represents another serious violation of city policies that require “All persons named as potential witnesses and those who may have information relevant to the issues of the complaint will be contacted and interviewed during the course of the investigation.”
• Kramer’s final report was delivered on January 16, 2009, almost eight months after Miller’s initial letter of complaint. Despite the specification in her retention letter from LCW, “Transcribed witness statements or signed notes should be included with your report,” she conceded in her deposition that “I did not provide transcribed witness statements or signed notes.”
What were the terms of the settlement and release agreement between Miller and the City of Carmel-by-the-Sea?
• The agreement does not impose any constraints on the release of information related to the suit by either Miller or the city.
How much did it cost the city to defend the lawsuit?
• The largest share of the total cost has probably been covered by CSAC Excess Insurance Authority, the city’s insurer. “CSAC” stands for “County Supervisors Association of California,” also known as “California State Association of Counties”. Its Excess Insurance Authority was established by a joint powers agreement “entered into by the member counties and member public entities in order to develop and fund insurance services.”
A $10,000 deductible was paid by the city. The $600,000 settlement to Miller was covered by insurance. CSAC claims that this settlement alone will not influence future premiums.
• Payments to the two legal firms that primarily represented the city have totaled $226,447 as of August 31, 2010, with LCW paid $85,395 and Kennedy, Archer, and Harray paid $14l,051. CSAC paid all bills from the latter firm, but we don’t know what portion of LCW’s bills were covered by insurance.
• The suit was filed on June 17, 2009. It was reported to CSAC on July 27. The insurer considered this to be timely reporting.
• City policies require that all complaints that may lead to litigation must be reported to the insurer within three days. Yet, 14 months elapsed between the receipt of Miller’s first complaint letter and the ultimate reporting of the case to the insurer.
• The total cost of Kramer’s investigation was $15,678. According to a letter from CSAC Excess Insurance Authority, they do not “launch an independent investigation” but “are provided copies of the investigation conducted by the entity.”
What are the provisions regarding termination in the city administrator’s Employment Agreement?
• The city administrator is an “at will” employee whose employment may be terminated by the city council without cause. There is no express or implied promise made for any form of continued employment.
• Deliberations and decisions by the city regarding termination shall be made in closed session in accordance with the Brown Act. Except where the administrator is charged with or alleged to have committed criminal misconduct or acts involving moral turpitude, the city shall provide the opportunity to resign in lieu of being terminated, and the parties shall cooperate regarding public announcements about his or her separation from the city.
Unless terminated for cause while the administrator is still willing and able to perform assigned duties, the city agrees to make a payment equal to six months of the then current aggregate salary. This payment will release the city from any further obligations. If the administrator is terminated because of conviction of any felony, or any crime involving moral turpitude or any offense involving a violation of official duties, or if the city determines that the administrator has misappropriated public funds, commingled public funds with personal funds, or engaged in willful corrupt conduct in office, then the city shall have no obligation to continue the administrator’s employment or to pay severance
On May 20, 2008, the attorney representing Jane Miller, Carmel’s human resources manager, addressed a letter to the mayor and city council complaining of harassment by Rich Guillen, the city administrator. That letter was forwarded to the city attorney and, for response, to the city administrator, the alleged harasser. No other immediate response was forthcoming. Five weeks later, the city referred the matter to the law firm of Liebert, Cassidy and Whitman. After another six weeks elapsed, LCW engaged Karen Kramer as investigator. Her first investigative interviews occurred at the end of October and her final report was submitted the following January. In the meantime, having received no direct response from the city, Miller referred her complaints to the California Department of Fair Employment and Housing, and, eventually filed a suit against the city in June of 2009. A settlement of the suit was achieved in June of 2010.
From the outset, the city violated stated harassment policies and procedures in managing Miller’s complaints. For example:
• The city failed to respond to the initial statement of complaints with “discretion, sensitivity, and due concern for the dignity of everyone involved.”
• Policies prescribe immediate referral to a nonexistent council personnel committee. Instead complaints were referred for response to the alleged harasser.
• Policies require that “investigations will be timely and extensive as required.” The investigation essentially began five months after the complaints were filed and was cursory at best. The report on the investigation was submitted eight months after the initial letter of complaint.
The many shortcomings in the investigation include:
• The investigator failed to review many significant documents, most importantly the emails from Guillen to Miller that were so prominent among her complaints.
• The investigator failed to interview several important witnesses, including former employees and those recommended by Miller.
• The investigator accepted untruths from the city administrator without checking their veracity.