Sexy marketing or sexual harassment?

American Apparel CEO Dov Charney doesn’t try to hide the fact that his company has different rules about workplace relationships than a lot of other American businesses.

Keith Fink, lawyer: Now, as you understood this American Apparel policy or spirit of having freedom in the workplace, does that encompass American apparel employees having sex at the workplace?

Dov Charney, American Apparel CEO: Provided they’re in a private setting and no one else is aware of it and they’re on their break.

Fink: How about if they take their 10-minute break which the law allows them and they go into a supply closet and no one can see them and they actually have intercourse?

Charney: Well if it’s if no one could see them and or there is a reasonable expectation of privacy, I’m not going to run rush in like some Nazi and tell them to stop having consensual activities.

In his videotaped deposition, Charney declined to answer whether he had ever had sex in the workplace, or to discuss which women in the company he’s been involved with. But one  former American Apparel employee claims Dov Charney was eager to pursue a number of his subordinates.

Employee: It was understood that Dov was looking for sex almost constantly.

Josh Mankiewicz, Dateline correspondent: And that he was looking for it from his employees?

Employee:   Yes.  He was looking for sex from his employees.

The former employee is a young man was a mid-level employee at American Apparel until last year. On Dateline, he asked us to conceal his face and voice saying he thinks publicly criticizing a former boss could hurt his career. He acknowledges he was fired by Dov Charney. His account of Charney’s behavior was backed up by six other former employees Dateline spoke to from American Apparel locations in three different cities.

Some say they left voluntarily, others acknowledge they were fired. All say they were distressed by a boss they describe as obsessed with sex.

Employee:  His language was constantly inappropriate talking about sex, talking about—his own genitalia, talking about—other people’s.

Mankiewicz: He would say, “Hey, I’m all about sex and freedom of expression and everybody should say what’s on their mind, and that’s what was on my mind.”

Employee: I agree with freedom of expression. However, when you combine that with the job setting, when you’re using it as power over other people, that’s inappropriate.

Charney declined to talk to us, but a company spokesman said our sources are “disgruntled ex-employees” asserting “blatant falsehoods under a cloak of anonymity.”

He also said: “The truth is that American Apparel, which employs more than 4,500 people, faces a single baseless workplace lawsuit.”

It’s true there is only one lawsuit now because the other two plaintiffs, who sued Charney jointly, have reached a confidential settlement with the company out of court, in which American Apparel did not admit any wrongdoing.

And the company introduced us to a group of high level employees, all women, who say working for Dov Charney is a pleasure.

Alex, employee: Dov’s a really exciting person to work with.  I mean, he’s definitely eccentric, we all know that, but he’s also really inspiring.

Carolina, employee: I think Dov’s a brilliant man, he’s very loyal, I enjoy working for him.

These women say any bad publicity American Apparel has gotten stems from a misunderstanding of the company’s unconventional style.

Mankiewicz: How important is sex to the American Apparel image?

Alex:  Very. Sex definitely comes into play.  Every ad we do, “Is this sexy?  Does the garment look sexy, does the model look sexy, is it the right kind of sexy?”  You know.

Cara, employee: It hasn’t always been just about, you know, sexiness.  I mean, we have an adorable older couple taking about this new jacket and how cute is.

But when Dov Charney talks at work about what’s sexy, they say, it’s always in a professional context.

Mankiewicz: Ever hear him talk about women’s bodies at work?

Alex: Sure, I mean, again, with the photos, with the models—

Mankiewicz: Ever hear him talk about sex?

Alex: Yeah, in a way, we do talk about sex, as I mentioned.

Mankiewicz: I don’t mean just sex, as in sex he might have had, as a—

Alex: As in, “I had sex last night”? No. No.  We don’t talk about that.

These employees do acknowledge the company’s Web site isn’t the only place where the boss has made appearances in his underwear.

All the women, nodding: Yes, we’ve seen him in his underwear.

Cara: American Apparel underwear. Not randomly in underwear.

Marsha, employee: I mean, we sell underwear, it’s not uncommon to see someone in their underwear here.

They know Charney has dated some of their colleagues, but say they don’t care.

Carolina: Yeah, it’s his personal life. I’m more concerned about getting artwork out to the source, meeting my deadlines, than worrying about who’s dating Dov.

And the women reminded us that American Apparel has no rules against dating in the office. The company says Charney’s relationships with his employees have been consensual, that he’s never demanded sex nor let sex be the basis for hiring, firing or promoting any employee. And this group says they’ve never seen Dov Charney behave inappropriately.

Mankiewicz: There are women in this country, in the work force, plenty of them, who feel as if they have the right to come to work and not have any discussion about sex with their boss, regardless of  what kind of work they do.

Alex:    Well, it’s actually in our employee handbook. We do talk about how, you know, especially in a creative department, you can expect a certain type of dialogue happening, and if you don’t feel comfortable with that, than maybe this isn’t the place for you to work.

That language in the handbook states that employees working in creative areas of the company “will come into contact with sexually charged language and visual images. This is part of the job...and is not deemed to be harassment by American Apparel.”

Cara:  You can’t go work for Hustler Magazine and then, all of a sudden, say, “I’m offended by women’s breasts.” 

Marsha: You could just go onto our Web site, wear our clothing, go into one of our stores, and you’ll see that sex is a big part of how we build our brand.

Employees: If that makes anyone uncomfortable—

Mankiewicz: Go work at Sears?

Female employees: Yeah.

The employees didn’t want to talk about the lawsuits filed against dov Charney, beyond this:

Alex: I think it’s a money-grab, that’s what I think, frankly.

The lawyer for plaintiff Mary Nelson disputes that, of course. He says his client has a long list of valid complaints against her former boss.

Fink: I view this as the emperor has no clothes.  But Mr. Charney thinks he’s the emperor and he can do whatever he wants at the workplace including walking around with no clothes. This is a garment company that’s got pornographic magazines on its walls.  You have pictures on the server of women spread eagle. I mean, you want me to go on with the litany of problems there?

Mankiewicz: Yes.

And there’s more: like the one meeting that makes the underpants sessions look tame.

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