For businesses in the UK, the Equality Act 2010 clarifies the rights of those who believe they've encountered harassment. It also clarifies the rights of those they're accusing of harassment. The Act defines harassment as '…behaviour which causes alarm or distress'.
In a sexual harassment context, this is specifically defined as behaviour that either violates an individual's dignity or creates an intimidating, hostile, degrading, humiliating or offensive environment. A person can be in breach if their behaviour intends to cause these reactions.
This behaviour is a serious matter, given that harassment is discrimination under the Act. The Act also imposes a duty on employers to stop such behaviour when identified.
Failure to do this effectively may end in an employment tribunal claim unless the employer can demonstrate they took reasonable steps to prevent harassment.
It's important to respond to allegations quickly, sympathetically and impartially - no matter how senior the position of the accused individual. In terms of policies and procedures, you also need to have a sexual harassment policy in place.