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Friday Workplace Briefing

The FWC Stop Sexual Harassment Jurisdiction Just Ordered Compensation Against Individuals – in the Second Decision in Two Weeks the Federal Circuit Court Made Significant orders for Compensation Against Two Businesses for non-touch Sexual Harassment and Two Individuals.

Recent decisions from the Fair Work Commission and the Federal Circuit Court have sent a powerful message to employers and individual workers alike — sexual harassment liability is expanding rapidly, and the financial consequences are becoming increasingly significant. In the second major decision delivered within two weeks, substantial compensation orders were made against individual respondents, including in matters involving non-physical sexual harassment. These decisions reinforce the growing legal, reputational, and psychosocial safety risks facing workplaces that fail to properly prevent and respond to inappropriate conduct.

Andrew Douglas and Kim McLagan will discuss these important developments, the emerging legal trends, and what employers should be doing now to manage risk and meet their workplace obligations.

Watch this week’s Friday Workplace Briefing Video here.

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About the Hosts

Principal Lawyer - Head of Workplace Relations

Episode Transcript

Kim McLagan: Main topic.

Andrew Douglas: The main topic. What a discussion this one is.

Kim McLagan: Yeah.

Andrew Douglas: This is a guy who worked inside in Storage King.

Kim McLagan: Yep.

Andrew Douglas: His sexual orientation is not an issue in this. So, you’re not told whether he’s gay or not gay. But a contractor started off teasing him about being gay for whatever reason, and then joined in with a customer to continue this focus upon him in being gay, and saying harmful and destructive, and it hurt this guy.

Kim McLagan: Oh. Terrible things.

Andrew Douglas: Yeah. So, he originally joined the employer and then decided not to join the employer. ’cause the employer had no knowledge of what was occurring or a method of prevention. But we don’t get a lot of detail around that part of it.

Kim McLagan: No. Yeah.

Andrew Douglas: But what he did is he brought an order, and this shows the breadth of this jurisdiction. Just like the bullying jurisdiction.

Kim McLagan: This is the prohibiting sexual harassment at work.

Andrew Douglas: Harassment. Yeah, yeah.

Kim McLagan: Provision in the Fair Work Act, yeah.

Andrew Douglas: Kept just like the bullying one, except this one has a compensation arm to it these days.

Kim McLagan: Yeah.

Andrew Douglas: Against a customer and against a contractor. And Vasta found their behavior as appalling. That’s Judge Vasta. Sorry.

Andrew Douglas: Yeah. Found their… And ordered 45,000 or 90,000-

Kim McLagan: 90.

Andrew Douglas: Between two of them to be shared.

Kim McLagan: Yeah.

Andrew Douglas: And then 13,000 individually to each person. Really interesting decision ’cause you start to understand, the bullying jurisdiction has never been used like this. Okay? But it can be.

Kim McLagan: Could be.

Andrew Douglas: But it can be against people who are non-employees. You can do it. So, what do I think this tells us? One, we now know where the tariff sits. Non-touch sexual harassment, irrespective sexual orientation, which causes harm. Sits in the middle. Of the $100,000 threshold. Yeah. Sits in the middle.

Andrew Douglas: That’s good to know, isn’t it? Because it says that this jurisdiction is not designed for very dangerous sexual harassment because we know in sexual harassment land that’s hundreds of thousands of dollars. But it does show you that it’s being taken incredibly seriously. So, I thought a really fascinating decision.

Kim McLagan: Great decision.

Andrew Douglas: This doesn’t prevent a person from bringing a workers’ compensation claim as well. But we do know you do need to pick your jurisdiction around sexual harassment if it’s on the same group of facts. We dealt with that case a couple of weeks ago.

Kim McLagan: Yeah.

Andrew Douglas: Okay. Why don’t we go onto the case study.

Kim McLagan: Okay. Kev was hurt. He felt that his boss, Connie, was cold and indifferent. He had spoken to her about his child’s special needs and his own health issues, but instead of showing compassion, she simply asked what support he needed. What Kev really needed was understanding. Connie appeared emotionally cold, and other people had noticed it as well. There may have been many explanations for her behavior, but she was not sharing any of them. Tired, vulnerable, and sad, Kevin approached Connie.

She was busy, and her actions suggested that he was a nuisance. However, he had practiced what he needed to say, built up the courage to speak, and knew it was the right thing to do. Despite Connie staring at her screen, he began speaking. He said, “Connie, I’m struggling. Alf, the leading hand, is rude, mocks my limp, and gives me work below my classification. He called me the ‘gimp’ the other day. I don’t feel safe coming to work. I need you, as our foreman, to help me. My life is hard enough without the harm Alf is causing.”

Connie, distracted and disinterested muttered, “Kev, you need to get a grip. He is your boss. Stop looking for issues to complain about and just do the job. He, like me, is tired of your excuses!” Kev was shocked. He left work. He, sorry, he felt lost. He left the office and caught a bus home and made an appointment to see his doctor. However, seeing a doctor was not easy in Warburton because the waiting list was long. He was given an appointment in two weeks time. The next morning, the phone rang. It was work. He did not answer because the name on the screen was Connie. He did not feel safe speaking to her. Later, he sent a text message asking her not to call him on his personal phone.

He explained that he was hurt, unwell, and scared of her. The next day, he received an email on his work account from Connie stating that he had an obligation to provide evidence of his illness, otherwise she would treat his absence as abandonment of employment. Kev have felt bullied and ignored, and he ignored the email. He switched off his computer. Three days later, Connie sent another email stating that she had not heard from him for three days, and that unless she received appropriate evidence supporting personal leave, she would assume he had abandoned his employment. Shortly after the email was sent, Nicky, a friend from work, dropped by to see Kev.

She told him that they were going to sack him if he did not respond. Kev explained that Connie was bullying him and that he did not feel safe responding, and that he had a medical appointment the following week and he would provide a medical certificate then. Nicky told Connie, who simply laughed and said, “He just doesn’t want to come back.” The next day, Connie sent Kev a termination letter stating that he had abandoned his employment. Kev then made an application to the Fair Work Commission, alleging that he had been wrongfully terminated. Connie responded with a jurisdictional argument, claiming that Kev had not been terminated by his employer.

Andrew Douglas: That was interesting, wasn’t it? That was after half a bottle of red wine. That’s why it was a bit long.

Kim McLagan: You often use the word gimp. I nearly laughed at that one.

Andrew Douglas: I shouldn’t. I’ve never used it to anyone. Okay, what claim could Kev bring in the Fair Work Commission? So, he’s got two obvious ones, hasn’t he? He’s got a discrimination. Sorry.

Kim McLagan: General protection.

Andrew Douglas: General protections and unfair dismissal.

Kim McLagan: Dismissal, yeah.

Andrew Douglas: But he’s also raised a number of protected attributes of caring, disability, a whole lot of other stuff. So, there’s also a discrimination claim lurking in the background.

Kim McLagan: Yeah.

Andrew Douglas: Okay.

Kim McLagan: And stop bullying.

Andrew Douglas: Stop bullying? Yeah, yeah. Good, good, good.

Kim McLagan: Yep. Yep.

Andrew Douglas: So it’s amazing, isn’t it? When you get going in this? We’re lucky, we’re not plaintiff lawyers, aren’t we? We get quite excited about this sort of stuff. But I guess what, part of the reason I’m raising this is as we go through the questions, it becomes really apparent that there are a number of tools in an employee kit bag when they’re treated wrongly. And it is wrong to think it’s just going to be an unfair dismissal claim you can settle.

Kim McLagan: Yeah.

Andrew Douglas: ‘Cause that’s not the case.

Kim McLagan: Yep.

Andrew Douglas: Was Kev able to make a successful workers’ compensation claim?

Kim McLagan: Without a doubt.

Andrew Douglas: Without a doubt. In any jurisdiction, with any amendment.

Kim McLagan: Yeah.

Andrew Douglas: He was still going to win, wasn’t he?

Kim McLagan: Yeah.

Andrew Douglas: Was Kev discriminated against? And if so, what was the protected attribute?

Kim McLagan: Yeah, mainly the disability.

Andrew Douglas: So, disability. Caring.

Kim McLagan: Caring.

Andrew Douglas: Yeah. So, there’s some pretty easy ones that are sitting out there.

Kim McLagan: Yeah.

Andrew Douglas: And for general protections, not as an attribute, but as a workplace right. Clearly he’s raised complaints.

Kim McLagan: Yeah.

Andrew Douglas: Okay?

Kim McLagan: Yep. Could Kev have brought a stop bullying order while he was still employed? We’ve addressed that.

Andrew Douglas: Yeah, and the importance of that is after he is not employed, he can’t, okay? Because it’s stop bullying.

Kim McLagan: It’s stop.

Andrew Douglas: And stop sexual harassment is at work, and if they’re not at work and terminate, you can’t bring it.

Kim McLagan: Yeah. Did Connie and the business breach workplace safety laws, and if so, how and what charges could be pursued?

Andrew Douglas: So, the answer is really clear. Yes, they could. And if we just start with Connie, because Connie’s behavior is attributed to the organization. So, whatever I charge Connie with.

Kim McLagan: Yep.

Andrew Douglas: I’m charging the organization. Did she do everything that was reasonably practical to provide a safe workplace? No. She created the hazards. They became high risk. She was aware of those risks. She did nothing to control. In fact, she did quite the opposite. So personally, what she has done is without doubt, fail to exercise reasonable care to protect him. So, Section 25 breach in Victoria and similar. So, personal liability is alive there. Connie’s not an officer. So, forget about that. Is her behavior so bad that it gets to reckless endangerment? That is, was she aware that there’s a risk of serious harm and indifferent to it? So, the standard of care is there. Unsafe workplace, unsafe system.

So, there’s a lot of liability. It’s not going very well. The next question is, did Connie’s behavior lift to a level from breach of her primary duty to one of reckless endangerment? The two core elements of that is did she appreciate or could she reasonably appreciate there was a risk of serious harm? I don’t think it meets that threshold. The second part is, was she indifferent? Absolutely.

Kim McLagan: Yeah.

Andrew Douglas: But it shows you with a little bit more meat on the bone, a little bit more harm that is obvious, that she would be in reckless endangerment territory. Even though at the moment there’s no demonstrable illness. She would be. Well, Kim, it’s been a lot on today.

Kim McLagan: And the company,

Andrew Douglas: Oh, now in the company.

Kim McLagan: Didn’t provide, well, primary duty breach of primary duty.

Andrew Douglas: Yeah, no, breach. Sorry, that’s what I said. Breach of primary duty for company. Sorry.

Kim McLagan: Sorry.

Andrew Douglas: That’s okay.

Kim McLagan: I wasn’t listening, obviously.

Andrew Douglas: Yeah, no. Forget about that last bit. We’re saying goodbye again. All right, well, thank you very much. We’ll see you later. Cheers.

Kim McLagan: Thanks everyone.

Andrew Douglas: Bye.

Check this next

Kim McLagan and Monnette Samo examine the latest developments in Victoria’s bullying jurisdiction and emerging compliance expectations.

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