City of London insurance market Lloyds of London today issued its largest fine ever against syndicate member Atrium, after the underwriting firm failed to “adequately protect” a junior employee once it became aware of a “systematic campaign of bullying”.
In a notice, Lloyds of London said it had fined Atrium Underwriting a record £1.05m for failing to deal with a years’ long bullying campaign against a junior employee and tolerating a “culture of unacceptable personal behaviour”.
Atrium failed to take disciplinary action against Employee A, the Atrium worker responsible for the bullying, even after its own investigation “made findings of serious misconduct.”
Instead, the firm negotiated a settlement package with the employee and sought to cover up the scandal, in a bid to avoid any bad publicity.
Atrium also failed to acknowledge or challenge Employee A’s “discriminatory and bullying conduct” and told the junior employee – who complained about Employee A’s bullying – not to speak about the allegations or the outcomes of the investigation.
Lloyds also accused the underwriter of “sanctioning and tolerating” an “annual Boys Night Out” during which male members of staff, including two senior executives, would make “innapropriate and sexualized comments about female colleagues” and engage in initiation games and heavy drinking.
The record fine comes as Lloyds of London has previously vowed to tackle its male dominated culture, after the City of London institution faced claims it tolerated a “deep-seated culture of sexual harassment”.
John Neal, Lloyd’s CEO said: “We are deeply disappointed by the behaviour highlighted by this case, and I want to be clear that discrimination, harassment and bullying have no place at Lloyd’s.”
The insurance market chief added that Lloyds’ decision to issue its “largest fine ever” shows Lloyds “will not tolerate poor conduct in our market.”
“Everyone in the Lloyd’s market and Corporation should expect to work in a culture where they feel safe, valued, and respected and if they see unacceptable behaviours, to speak up with confidence, in the knowledge that action will be taken,” Neal said.
Andrew Brooks, Chairman of the Lloyd’s Market Association (LMA), said: “The judgement by the Lloyd’s Enforcement Board and the penalties levied against Atrium send an unequivocal message: bullying, harassment and other forms of inappropriate behaviour have no place in the Lloyd’s market.”
“We support Lloyd’s for its decisiveness on the matter and the unprecedented level of the fine, which demonstrates the market’s commitment to fostering better cultures. Any individual or organisation which threatens this or condones those who do, must now recognise that there will be severe consequences.”
Christopher Stooke, Independent Non-Executive Chairman at Atrium, said: “We fully accept the rulings made by Lloyd’s of London. With deep regret, it is clear that Atrium failed to live up to its values and serious errors were made when handling these matters.”
“The behaviour outlined in the Notice of Censure has no place in our business or our industry, and we recognise that we must go further to ensure that this situation is never allowed to happen again,” Stooke added.