Answer from Kyle, PHR:
You need to investigate the matter. A racially insensitive comment could be considered harassment—unwelcome behavior that’s based on a protected class such as race. Harassment becomes unlawful if putting up with it is a condition of continued employment or if the conduct is severe or pervasive enough to create a work environment a reasonable person would consider intimidating, hostile, or abusive.
If you find evidence that harassment or any policy violations occurred, you should follow up with the offending employee. Your response should match the severity of the offense. A mildly insensitive comment might warrant an educational conversation or a warning, whereas a racial slur might warrant a final warning or termination, depending on the circumstances.
Document your findings and any disciplinary actions taken.
Kyle is a professional author, editor, and researcher specializing in workplace culture, retention strategies, and employee engagement. He has previously worked with book publishers, educational institutions, magazines, news and opinion websites, nationally-known business leaders, and non-profit organizations. He has a BA in English, an MA in philosophy, and a PHR certification.