I complained my team lead when I was leaving that company, the HR lady(she is a nice CBC) told me I should have come to her earlier, and they have the reponsibility to solve this problem(instead of my reponsibility), she also told me if I meet the silimar situation, just tell the manager and HR, don't be tolerant, you can always tell them what you feel uncomfortable, you don't have to judge if that is against law or not.
in 7y7's situation, it is very very serious. what she did is totally right. that is the only totally solution, isolate the enemy, utilize all your resource to crack them.