Dear Evil HR Lady,

We recently had a female employee accuse her direct supervisor, a male, of sexual harassment. Now, we are very small, and don't have an HR department. Could you point us in the right direction on how to handle this? We have separated the two before, but need some direction on how to handle this.

You've successfully done the first step in a sexual harassment (or, for that matter, racial, religious or other illegal harassment), which is taking it seriously. One of the worst mistakes companies make is ignoring complaints like this. Even if you're in a situation where you are 99 percent sure that the complainer is making it up (or over-reacting), you need to take complaints seriously.

Handling a sexual harassment charge and the subsequent investigation is, to quote HR expert Susan Heathfield, "Hard." When trained HR experts who have conducted numerous investigations label this process as hard, know that this is not going to be a piece of cake for you either. The investigation should be spearheaded by someone who is experienced and knowledgeable. This is not a job for the intern.

And you should take these complaints seriously even if the employee doesn't come out and directly say the words "sexual harassment." Often times people don't want to get anyone in trouble, they just want the harassment to stop. So they plead for anonymity and use soft words like, "It bothers me." You still need to take it seriously.

You've also taken a great second step, in separating the two employees in question, although you need to be careful on how you do this. If you move the complainer to a new location or department, it can be perceived as a step down or as a punishment. Then you run the risk of being guilty of retaliation. You don't want to do that. But if, (keeping in mind that I am not a lawyer, this is not legal advice, and you should always have a labor and employment law attorney on your speed dial) there is no downside to the move for the accuser, then you're good.

Here's what to do.

Conduct interviews with everybody involved. Be specific in your questions--dates, times, locations, what was said, who else was present, are there any emails, voicemails, or other evidence that's documented. Don't leave out the witnesses or potential witnesses. You need to conduct the investigation in as neutral a manner as possible. Depending on the allegation, you may or may not have to tell people who made the accusation. For instance, if the accusation is that Bill is looking at porn in his cube, you don't have to mention that Susan complained. If, however, the accusation is that Bill put a naked picture up in Susan's cube, Susan's name will come up. Conclusions shouldn't be drawn until the end of the investigation.

Assure everyone that you will be fair, thorough, and listen to everything. Caution people not to discuss this while the investigation is proceeding. Don't draw conclusions until the investigation is finished. Also assure the accuser that she will not be retaliated against and that she should report, immediately, any attempted retaliation.

Document everything. Put a time line together. List facts and direct quotes from people. Make things so clear that anyone walking in off the street could pick up the file and read it and understand. This is critical for protecting your business and justifying the end decision. Don't whitewash anything.

Make a final decision. Sometimes this is super easy--there are mountains of evidence that the "alleged" harasser is an actual harasser and that the person filing the complaint understated how awful and terrible this person was. Sometimes, it becomes extremely obvious that the accuser is trying to deflect a poor performance appraisal, stave off a termination or is just out to get someone. Often, however, the evidence is somewhere in the middle. For instance, if it turns out that the two people were in a consensual relationship and then one wanted to break up, it can be messy. (That's why you should have a policy prohibiting managers from dating employees in the first place.)

Act on your decision. Sometimes this means sending the harasser to sexual harassment training. Sometimes this means firing the harasser. Sometimes it means explaining to the accuser that the complaint didn't rise to the level of sexual harassment. You have to make an evaluation based on the evidence and move forward.

If you determine, for instance, that the accused really did offer a promotion in exchange for sex, you'll want to fire that person. Yes, even if the harasser is your star salesperson or the head of marketing or brought in $3 million in venture capital. Someone like that is not someone you want on staff.

Keep in contact with your attorney. If you need to take serious action, such as firing someone, you should speak with your attorney before doing it. Why? Because even with your thorough investigation, you want to make sure all your i's are dotted and t's are crossed and that you're in compliance with both federal and local laws. When you're taking a serious step such as this, you may wish to offer severance in exchange for a release of all claims (legally allowed) against your company.

So, assign someone to take the lead and start speaking with all relevant people. Document the heck out of everything. Make sure you're in compliance with all applicable laws. Make a decision as to the truthfulness of the allegations and then (finally) decide on an appropriate course of action.

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