Oh...It's Not That Serious!!
According to the Supreme Court:
“…when isolated incidents that are not “extremely serious” come to the attention of management, appropriate corrective action should still be taken so that they do not escalate.” Faragher, 118 S.Ct. at 2283.
In other words, your employers can not justify inaction, in regard to an isolated incident, by saying that the incident was only a minor or moderate level incident. Any harassing or discriminatory incident that is reported to management should receive consideration for corrective action.
Remember, management is legally obligated to prevent and correct the effects of harassment and other illegal behavior. Therefore, management can’t assign “code levels,” like the former security alert system used for terrorism (orange, red, etc.), to determine when they will attempt to stop negative behaviors from escalating.
They MUST establish and implement an appropriate corrective response that will put an end to the behavior.