I am adding a “sexual misconduct clause” into all of my investment agreements
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As someone unfamiliar with investment contracts, what's the typical burden of proof like for comparable "nuclear option" moral clauses? Is there typically some kind of evidence required in the contract? Or is it just assumed to be "whatever will hold up in court"?
To be clear, I think this is a very interesting idea, and am in fact a little sad it isn't common place (it seems like something that should be covered by the kind of morality clauses which I understand to be common place). However, an idea like this needs to be enforceable to be practical and thus valuable.
EDIT: Since this is an often controversial subject, I want to be very clear: I'm not trying to imply that founders/employees will make these claims up. Rather, that assertion is one which is very likely to be used by the well-paid legal teams of whoever you're trying to evict from your board. Would this kind of clause actually stand up in court under that kind of assault?
Since I am basically creating this with my lawyer, I am going to make it unambiguous- either a recorded conversation, a verifiable conversation on text/whatsapp/email, a photo or in extreme cases a rape kit.
In my opinion this should be a deterrent rather than something that would ever need to be enforced. But it can't be a "he said/she said" either
It sounds good in theory, but the definition of sexual advance is vague.
The investor will be thinking - what if some day you feel that you just want to take back the shares, how easily could you action this clause and what protections do I have?
If we're talking a lost court case against the investor, then yeah that works and is solid. If you want to action the clause without that then who will be judging if the recording/photo etc. qualifies under the sexual advance claim?
Wow, yes. This is going into any investment agreement I would ever consider signing. This is powerful. It puts the emphasis where it belongs and give it teeth.
I see a parallel with the anti-smoking campaigns. I think it's pretty lame to pass a law telling, e.g. a bar owner they can't allow smoking in their own place, but I'm willing to let it slide for a few decades until many fewer people are dying of addictive poison (however voluntarily.)
In a healthy environment, people who are interested in each other shouldn't feel awkward about entering into a more familiar (than professional) relationship, even in this context. However, we are not there yet, and in the meantime investors and their employees making sexual advances at the people in the companies they are funding should be considered beyond the pale.
No one was "forced" to work in a smoke-filled environment, this part of issue was framed as discrimination against non-smokers working in places where smoking would be allowed.
It makes a kind of sense, right? OSHA violations for workplace exposure to cancerous agents is a thing for a reason. But I never liked the abridgement of personal freedom. It would be possible (even now) to permit exceptions for some businesses, but that wasn't what the anti-smoking lobby was interested in, was it?
In any event, I see a weak parallel between the two situations: We accept a (temporary and excessive) restriction for a time to correct a large and otherwise-intractable social issue.
In the one case it was addictive poison, in the other inappropriate sexual advances in formal business relationships.
You can speak of the abridgment of personal freedom of the owner, but what about the effective freedom to work in an healthy environment? Oh yeah, regulations are there to ensure that. But I may be biased, I am from France and support such things as 35h weeks and no-work-on-Sunday laws (to ensure people can have a social life).
;-)
As I said, a compromise could have been reached but the "aggressor", if you will, was not interested.
(Also, as an American working stiff, I envy you your sensible arrangement. But as a Bucky Fuller fanboy, I think we all should be working two hours a week, and retire at twenty having worked a full career for two years. C'est la vie...)
Wait a sec, I don't get it. If I as employee like some girl and ask her for a date, is it a sexual harassment?
To be honest, I don't like this trend...
Also, the term "unwanted" makes me wonder about the existence of a "wanted sexual advance".
I worry that this whole concept is too fraught with "gut feeling" decisions and that could cause injustice or liabilities.
It might be cleaner to say that romantic or sexual workplace relationships are forbidden and that extends to investors, contractors, suppliers, vendors, etc. if the relationship clause is violated, all the involved parties will be fired or banned from interacting with the company, with any owned shares seized.
Basically like zero-tolerance policies in public school applied to the business world. It's more harsh, but it's equally unfair to everyone.
> Let’s talk about an uncomfortable truth, sexual harassment and assault is common in the tech industry
I also disagree that it does make sense officially demonizing men by adding special clause to investment agreement.
If someone did something illegal go to the police.
If it's not directly illegal then it's a common conflict situation as if one male spit on face of another male.
I'm pretty sure you would not add special clause against "spitting on face" although it could happen.
Despite nobody add this special clause, I'm pretty sure it's not allowed and if you do that consequences of this action could be pretty serious.
What you want to add "makes a sexual advance towards" is very dangerous clause. After all, any flirt, any asking for date is exactly "makes a sexual advance towards".
We are not talking about a workplace romance, this is a very specific relationship, between founder and investor and it shouldn't be so hard for investors to know and clearly get the message that it is inappropriate.
Although, I have literally never heard an investor complain about this as a problem. (that doesn't mean it doesn't exist)
But this is about a power dynamic and putting proper boundaries in place.
I was, up to this point, unaware that all sexual harassment in workplaces was of women, by men.
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