Well, although I think she’s screwed, and rightfully so, Toad does have a point- this is New York; I don’t know the employment law there, but it’s probably written to benefit lawyers rather than companies or employees :-)
I posted about it down thread, even in NY she is scrod
For example, forcing people to work next to someone who has threatened women or people of other races could be seen as creating a hostile work environment. Also, your customers may be reluctant to do business with your company if they must deal with such a person.