American Apparel has fired its longtime CEO Dov Charney who is replaced by Paula Schneider, the company's first ever female chief executive.
Charney has been charged with a number of sexual harassment claims and was earlier subjected to a lengthy suspension. In December, the company ultimately decided to axe Charney, adding that it would not be appropriate to reinstate Charney as CEO, company officer or employee.
Last year, there were several women who came out in the open and alleged that Charney harassed them sexually. He maintains that such allegations are simply "baseless."
American Apparel became a famous brand because of the company's Y-fronts and Made in America T-shirts. However, it had also suffered from accusations of using ads that seemed to promote pornography.
With the series of lawsuits filed against Charney, alleging sexual contact with female employees, the brand's image may have become all the more tainted. Company shares have dropped, prompting the board to move against Charney. The latter defended that his sexual relationships with the staff were consensual.
As a way to pick up where Charney has left off, American Apparel decided to revise its company code, which had long existed during Charney's reign. The 6,200-word ethics code is now posted at the company's site and contains 12 pages, which is four times longer than the original. This is because the code expressed in detail everything -- from the company's fair treatment policy to its intra-office rules.
The new policies prohibit "discriminatory slurs, or any other remarks, jokes or conduct that, in the judgment of the company, create an offensive or hostile work environment or otherwise constitute abusive conduct." There's also a policy on preventing relationships between managers and subordinates.
"No management-level employee may make sexual advances, welcome or unwelcome, toward any subordinate, regardless of whether the subordinate reports to the management employee, either directly or indirectly," stated the company.
"Employees who fail to report a personal and/or romantic relationship as required by this policy will be subject to discipline. While confidentiality cannot be guaranteed, Human Resources will handle such disclosures in a discreet manner," the company warned.
