Workplace anti-harassment laws that protect a person from having to work in a hostile work environment have been interpreted to preclude racial harassment. Once the employer is aware of a problem, they need to take steps to correct it. Your wife could actually bring a lawsuit against her employer for punitive damages. Here's the elements that she'd have to be able to prove (and depending on what the letter says, it sounds like she'll be able to):
1. the plaintiff was subjected to [[slurs, insults, jokes or other verbal comments or physical contact or intimidation of a racial nature] [sexual advances, requests for sexual conduct, or other verbal or physical conduct of a sexual nature] [conduct affecting other Title VII protected characteristics]];
2. the conduct was unwelcome;
3. the conduct was sufficiently severe or pervasive to alter the conditions of the plaintiff’s employment and create a [[racially] [sexually] [other Title VII protected characteristic]] abusive or hostile work environment;
4. the plaintiff perceived the working environment to be abusive or hostile; and
5. a reasonable [woman] [man] in the plaintiff’s circumstances would consider the working environment to be abusive or hostile.
If she has to file a lawsuit, she may be entitled to recover her reasonable attorney's fees from the employer. For that reason, it may help to have a local attorney send a letter to her employer demanding that this behavior cease and desist immediately. The other alternative is to go ahead and file a lawsuit. It would be a violation of federal law for her employer to terminate her because she bought an action under federal anti-discrimination laws.
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