Employer fails on sexual harassment claim: $150,000 damages payout

In a recent case, the Victorian Civil and Administrative Tribunal ordered an employer and one of its male employees to jointly pay $130,000 for pain and suffering to a female employee as result of the male employee’s sexual harassment.

The employer company, Parker Manufactured Products Pty Ltd (Parker), was also ordered to pay a further $20,000 in aggravated damages for causing significant additional harm through its woeful and unbalanced response to the complainant’s allegations.

The male employee was found to have engaged in conduct amounting to sexual harassment by:

  • massaging the complainant’s shoulders and neck;
  • making comments about her physical appearance, and calling her names such as “sexy”, “baby” and “sweetie”; and
  • finally – after she collapsed at work due to illness – driving her home, assisting her inside, climbing into her bed, hugging her from behind, attempting to undo her bra and making sexual comments.

The complainant never returned to work following the incident in her home, which occurred only 12 days after she commenced employment with Parker, but she made formal allegations in writing. Parker responded with an internal investigation, concluding that the allegations were not substantiated.

Judge Harbison found that Parker’s investigation was biased and misdirected. Her Honour also held that Parker was vicariously liable for the conduct of the male employee because it:

  • did not take reasonable precautions as required under the Equal Opportunity Act 2010 (Vic), for example, because a Parker manager instructed the male employee to drive the complainant home;
  • did not take a neutral position towards the allegations, including throughout the investigation process; and
  • “did its best to actively support the [male employee] and blacken the character of the [complainant]”.

Lessons for employers

  • Conduct an external legally privileged investigation to handle serious allegations of inappropriate workplace behaviour. This approach is more likely to safeguard the mental health of those involved, remove perceptions of bias and – if investigators are engaged through lawyers under privilege – provide a greater opportunity for carefully considered remedial action.
  • Ensure that your business has up-to-date policies and procedures on expected workplace conduct, covering topics such as discrimination, bullying and sexual harassment.
  • Arrange for regular “refresher” training on workplace rights and responsibilities for all employees. Make sure that managers are aware of their special obligations and receive whatever additional targeted training is necessary. This will reduce the risk of vicarious liability for employee misconduct.

If you would like assistance in relation to workplace policies and training, please contact the Macpherson Kelley Employment, Safety and Migration team.

This article was written by Cinzia Pietrolungo, Lawyer – Employment, Safety and Migration.