I think the circumstances are pretty fucked up, though I don't know if this one can be fixed with legislation or litigation.
In reality it is gender discrimination, given the general attitudes in our culture, women are generally judged and held responsible for how they "make" men feel, especially if those feelings are arousal and in these cases instead of acting like adults men are expected to act like mindless, sex obsessed jerks with no self-control.
Its not about her being attractive, its about her being an attractive woman. Funny how it wasn't a problem for 10 friggin' years, till he noticed her, he harassed her about her clothing choice, he hit on her, and his wife "found out" (about some text messages, not even an actual affair *eyeroll*).
This is one of the reasons we have laws about sexual harassment, one's group of employees is not a dating pool. *barf* Sometimes I feel like we're hurtling back in time, instead of going forward.