Andrew Douglas: Okay, let’s go onto the major topic today, which is the 10 changes that we think are really big. And I want you to look at, as we have this discussion, think about what does that mean for the structure of governance inside an organisation. And what Nina and I want you to do is to go, well, use a risk-based methodology in looking in work, collect evidence that is appropriate and accurate, in respect of those hazards and properly analyse the risk, and invest within the culture to ensure the elimination or minimization of that. And you’ll notice that that nearly knocks out every single thing we talk about. So when we look at the more serious charges, we’ve said this repeatedly, but it is now coming through, we are seeing multiple industrial manslaughter charges being charged, and we’re seeing fines and incarceration from courts.

Nina Hoang: Heaps, like heaps.

Andrew Douglas: Yeah. So what we’ve seen is this escalation in charges from primary duty up to reckless endangerment, industrial manslaughter. Remember places like New South Wales and South Australia are getting industrial manslaughter in the year that come. Tasmania-

Nina Hoang: Is the only one that-

Andrew Douglas: Despite being a penal colony, is not killing anyone. So there you go. But for everyone else, we’re going to see some very serious charges laid where the regulator doesn’t back away, and where the courts are fearless about punishing. So we are going to see in 2024 people go to jail. We are going to see fines in excess of $2 million. We’re going to see a very dramatic change in that. We’re also seeing regulators, we got a case today, targeting officers. We’re going to see two things. One, much more serious charges for operational officers doing the breach.

Nina Hoang: Hopefully.

Andrew Douglas: But we’re going to start seeing like we did two weeks ago, with Scott, who was the judge, was happy to impose fines upon non-operational directors who ought to have been involved. So they’re the two changes. We already have seen in Victoria and New South Wales, the appointment of inspectors with psychological hazard training and expertise. We are starting to see regularly now throughout the eastern seaboard, particularly psychological hazards being an issue of focus for the regulators. And that will spread throughout Australia very quickly. So we are going to see many more prosecutions commenced, but we’re going to start seeing lots of improvement notices being issued in relation to psychological hazards, which is hard.

Nina Hoang: Yeah. And it’s not just the stereotypical, you know, blue collar industries where we’re seeing the regulators previously focused. This is going to affect every business and every industry, because psychological hazards exist everywhere.

Andrew Douglas: Yeah. And when you think about an organisation, I’m saying it’s happened in Qantas, and I fly with you, I still love you even though you delayed my flight the other day, we’re going to see organisations that have a strong white collar and blue collar environment, where it bleeds into that white collar environment. So where behaviours which are unfair or unreasonable, but are hazards identifiable. We’ll start to see improvement. Notice now, they’re really hard, because A, they’re an antecedent for prosecution, because they’re an admission of liability.

Nina Hoang: Yep.

Andrew Douglas: But they’re also incredibly hard to get it lifted, because you’ve got to demonstrate not only a change in system, but in practise. Easy for physical change, not so easy for psychological. We’ve already seen, particularly, through the education union, but through other unions using psychological hazards as a method of entry.

Nina Hoang: Yeah.

Andrew Douglas: And carrying out highly publicised bullshit investigations.

Nina Hoang: Oh, yeah.

Andrew Douglas: Which are just nonsense.

Nina Hoang: It’s just a broad membership.

Andrew Douglas: And funnily enough, leading it to organisations like The Herald Sun, who are happy to publish it, which is so odd given Murdoch’s political standing. But nonetheless, it’s going to happen, and it’s going to happen a lot. So, getting a grip on psychological hazards quickly, and we’re going to spend a lot of time early in the new year, with Nina giving you practical understanding of actually how to deal with that. But the most important thing to understand is unions don’t have a lot of teeth, which means they don’t bite that hard anymore if we stay in the biting register. But this is a way to let them back through the door. So don’t do it.

Nina Hoang: Yeah. And I think the biggest reason that they’re able to do this, is there’s a lack of understanding and education. Because of all the stuff that’s going in the media, employees are thinking, you know, everything is bullying. And they don’t understand what psychological hazards are. And the unions are saying, “No, you can’t be treated this way. They can’t do this to you.” And it’s fear-mongering.

Andrew Douglas: Yeah, it is. And you know, when we talk about governance, which is actually identifying the evidence of hazards through the usual sources, through HR, through these process, you can actually identify where the risk areas are and start to move. But also educate people. Like, when bullying first started being dealt with. That’s not bullying.

Nina Hoang: No.

Andrew Douglas: Bullying looks like this. This is what you say when you feel you’re given too much work. This is what you say when you think… You’ve got to give people the voice tools to actually manage it and then the problem just disappears.

Nina Hoang: Yeah. And I think the fear is, people think if they start educating employees on this, they’re going to get more claims. But the reality is, if you don’t, the moment you educate people, and they identify issues, then you can stop it from exacerbating.

Andrew Douglas: And look, can I-

Nina Hoang: You’re not going to get those workers to make claims.

Andrew Douglas: And look at, look at the example. when you look at psychological claims and workers’ compensation, which are going up. There’s been no education out there. And so what we’re seeing is people frightened, scared, angry, and hurt for making claims. If we’re actually engaging with people, giving ’em the tools to avoid conflict, you’re not going to get the claims.

Nina Hoang: Or identify when they need help so they can get the support they need. Yeah.

Andrew Douglas: Yeah. Okay.

Nina Hoang: Oh wait.

Andrew Douglas: I think, can we come back there? Laura, Laura, Laura, bring me back. We’re going to start seeing the use of hostile workforce as a pleading, that is part of claims where, where when a plaintiff firm brings a claim against someone for sexual harassment, they are going to provide the evidence of all past misconduct towards women, generally, when the org, and they’ll call those women.

Nina Hoang: And then they can expand it to almost class actions.

Andrew Douglas: Yeah, and that’s right. And then you get these massive aggravated damages that come with it. And remember, the claims are very high. So that’s going to happen. We will start seeing a scorched earth approach based on the state and federal level for underpayments. So please do a review in order to make sure you’re not, and then fix it. Workers’ comp premiums are already going through Victoria up by 42% next year, just on basic premium cost. But the increase in psychological claims will undoubtedly push premiums up very substantially. I think the day-to-day, Nina, we see a decline in union participation in nearly every site except for key, construction and key-

Nina Hoang: I think 1% of industries are still having a lot of unions involvement. And which is what we’re seeing in the news. But I think there definitely is a decline-

Andrew Douglas: Oh, they are looking. They’re not as clever as they were. They’re not engaged as they were before. They don’t have anything to talk about because people are paid well, looked after well. So psychological hazards, I want you to realise unions are not your enemy. They’re a third party. And if you lead well, they become irrelevant. And what we’re seeing from our clients is, improvements in leadership, which are just isolating the union. And they’re representing 3 out of 400 rather than-

Nina Hoang: Yeah. And it’s just occurring day-by-day.

Andrew Douglas: Yeah. And the last part is there will be a major change in privacy legislation probably early next year, which aligns it with the Great Britain standards that exist. These are very significant changes both in commercial and workplace law, which we’ll talk more about as it moves towards it. But it means a very, if there is something which Chicken Little isn’t wrong about these changes are very, very significant particularly in relation to hacking risks and things which create liability. But we’ll talk about it more next year. Let’s go to, we were worrying we wouldn’t have enough.

Nina Hoang: No. Yeah. We talk too much clearly.

Andrew Douglas: Yeah. No, we talk too much. Okay. Let’s go to the-

Nina Hoang: Case study.

Andrew Douglas: Case study. The cleansed case study.

Nina Hoang: Thanks, Laura.

Andrew Douglas: Laura has purged my case study. It has no swearing in it.

Nina Hoang: Angus owned a car distributor business for Toyota. Toyota was playing tough on the new distributorship agreement. He could lose everything unless he played his cards well. He was smart to avoid the flawed class action by other car dealers. He had better arguments as he was induced by Toyota on significant capital and operational expenses before the contractual review came through. He was also the most successful dealer in the region and farm machinery distributor agreements for a number of brands.

Carol worked as the head of the service division. It’s where they made their money. On any score, Carol was attractive. A city girl who moved to the country during COVID. Carol had spoken to Angus several times about the culture. The boys in service had a few saucy calendars on the walls. They made comments about Carol and other women about their looks. And on Friday drinks, they would occasionally cross the line with some of the younger women by saying flirtatious and sexualized comments.

On each occasion that Carol raised it, she went out, spoke to them, told them to stop. And on the most recent occasion, warned them of disciplinary measures. The problem was-

Andrew Douglas: Sorry. That should’ve said, “Carol raised it with Angus and Angus went out.”

Nina Hoang: Oh, okay.

Andrew Douglas: So that’s my mistake. So her boss went out and told them.

Nina Hoang: Okay.

The problem was the men in sales who were much worse. On Friday, the 1st of December, Carol observed their top salesman, Trev, caress Carol’s assistant, Jenny’s buttocks. She brushed his hand away and laughed, but turned bright red. Carol walked up to Trev, took him aside and read him the Riot Act. He laughed, tried to kiss her and make up. And she slapped him across the face.

She told Angus and then took Jenny home, who was distressed. On Monday, Angus hauled Trev in and demanded he apologised. Trev said, ‘Sure,’ went into Carol’s room, said he was drunk, elated from a big week’s sale and behaved badly. He was sorry. She took him into Jenny’s office and he did the same. For the next week, everywhere that Carol went, she felt the men ice her. No one said, hello. They all ignored her. And she heard one sale guy mutter to another, “Frigid, a word.” Carol got Angus more frustrated than angry.

He sighed, said that he was lost, how to address it as it had gone underground, but will arrange for his lawyers to run training. Carol was over it and started to look for other work. At the Christmas party, drinks flowed freely. Trev was making jokes at some mechanics when Carol walked past. As she came near the group, Trev reached out, gently guided her by her arm into the group and said the guys wanted to ask her something. She was reluctant but found herself in the middle of a circle of men. Angus was nearby having a beer with a CFO.

He was still tense from a difficult conversation with Toyota. Two of the mechanics started chatting to Carol, asking her why she came to the country to work. When Trev intervened and said, ‘What they mean is, why did you come here with your uptight city ideas and mess up our lives?’ The two mechanics said, ‘Yeah, such a waste of good, a word.’ Trev said-

Andrew Douglas: She’s gone wrong.

Nina Hoang: -slapping her firmly on the buttocks so the whole room could hear. Carol turned to Trev, ‘Don’t you ever touch me again, you freak.’ A huge cheer went up. She left immediately, emailed her resignation to Angus and sought psychological help.

Andrew Douglas: All right. That was a big case study.

Nina Hoang: Yeah. Very long.

Andrew Douglas: It’s been significantly reduced by Laura, I might add, I said so. So who’s in legal trouble then?

Nina Hoang: So Angus is in legal trouble, so is Trev. Well, potentially the other employees as well.

Andrew Douglas: Yeah. Yeah, everyone’s in trouble and they’re in trouble in a whole range of stuff, aren’t they? And if we go to the second question, which sort of raises the safety issue, the company is in huge trouble.

Nina Hoang: Yeah.

Andrew Douglas: Okay. Sorry.

Nina Hoang: Straight away because they were aware of the behaviour and although they, Angus did some things, like he tried to stop it. He didn’t discipline him about it, like Trev.

Andrew Douglas: No. And they were obvious controls that could have been done. So, I think when we look at it, Angus is definitely in trouble. Probably would be charged with reckless endangerment.

Nina Hoang: Yeah.

Andrew Douglas: And Trev definitely would be.

Nina Hoang: As reckless endangerment as well?

Andrew Douglas: Yeah. He would. The boys probably wouldn’t. Breaches, you know, section 25 type duties, which is individual exercise, reasonable care, not to prevent injury. Look, I’m so sorry.

Nina Hoang: That’s okay. Is there a good claim for damages around sexual harassment and victimisation? Who would be named? How would it be argued and what would the award? Well, there’s definitely a victimisation claim for, what’s her name?

Andrew Douglas: Yeah.

Nina Hoang: Carol?

Andrew Douglas: Yeah. For the icing of her. There’s absolutely no doubt.

Nina Hoang: And then they make comments to her as well.

Andrew Douglas: Yeah, the retribute of comments, the slap at the end. So this is a big, this is a very big damages claim because you’ve got a big lump of pain and suffering. She’s been humiliated. So the general damage is a part of it.

Nina Hoang: Yep.

Andrew Douglas: You’re looking at something 150,000.

Nina Hoang: And there’s clear sexual harassment on the basis of sex and there’s a hostile work environment.

Andrew Douglas: And there’s touching.

Nina Hoang: Yeah.

Andrew Douglas: So yeah, 150 plus general damages. Could be up to-

Nina Hoang: I think it’d be more.

Andrew Douglas: Yeah, it could be more.

Nina Hoang: Quite a lot.

Andrew Douglas: The damage that’s been done, if it’s significant means they’d be both aggravated and special damages around loss of earning capacity. There’s a million dollar plus claim.

Nina Hoang: Yeah. And probably she would succeed on vicarious liability as well.

Andrew Douglas: Yeah. Oh absolutely.

Nina Hoang: Yeah.

Andrew Douglas: Yeah. Absolutely. So, I guess what we want to do by giving you this problem was show, this is a bad example but not uncommon, the process building up to the Christmas parties when things turn that extra step.

Nina Hoang: Silly season.

Andrew Douglas: But what Nina’s raised is really important. All the evidence of past conduct goes to hostile environment. And when that comes before a judge, what the judge is going to say is, this is an incredibly dangerous place. I find it was a hostile workplace and for that I’m going to start my penalties. But then I find there is this really bad behaviour led by leaders in the business, condoned by a leader in the business, yes, he was stressed and, but he could have stopped it all. So you got to, you’ve got to claim, which is huge in damages, big in safety consequences. It’s big.

Nina Hoang: And then once they establish the hostile work environment, Jenny and other women who felt sexually harassed can then bring their other claims. ’cause they’ve got that confirmation as well.

Andrew Douglas: That’s right.

Nina Hoang: Onto the next question.

Andrew Douglas: Pardon me.

Nina Hoang: Would Jenny have a workers’ compensation claim? And would Carol if she obtain a certificate before resigning?

Andrew Douglas: Now Carol can even do it afterwards.

Nina Hoang: Yeah.

Andrew Douglas: But absolutely Jenny has a workers’ comp claim and absolutely Carol has.

Nina Hoang: Yep. Does Carol have a breach of contract claim as she ends more than the high income threshold?

Andrew Douglas: Now the answer is yes.

Nina Hoang: What is the breach of contract?

Andrew Douglas: Okay. So under a contract there is an implied duty to exercise reasonable care to prevent foreseeable harm.

Nina Hoang: Oh. So she’s breached that.

Andrew Douglas: So the negligence, so both negligence and contractual breach. She’d have a very substantial contractual breach.

Nina Hoang: Wow. So that’s available to her to claim as well as everything else.

Andrew Douglas: Yeah, it is.

Nina Hoang: Yeah.

Andrew Douglas: Yeah. Now the offsets for past workers’ comp pay or any other thing would go and get, would be reduced from it but yes, you would.

Nina Hoang: Interesting. We’d not discussed that claim.

Andrew Douglas: Okay. So we are back, when are we back?

Nina Hoang: I think February.

Andrew Douglas: February. Have a lovely break.

Nina Hoang: Yeah, enjoy your Christmas. Have a great New Year’s.

Andrew Douglas: We couldn’t find the caps. I’m sorry.

Nina Hoang: I know.

Andrew Douglas: See you later.

Nina Hoang: See you in the new year.

Andrew Douglas: Bye, bye.