Proposed law to impose positive duty on employers to prevent sexual harassment

In September 2022, Labor introduced the Anti-Discrimination and Human Rights Legislation Amendment (Respect at Work) Bill 2022 that will, if it passes Parliament, legislate a further seven recommendations from the Respect@Work Report.

The most significant proposal in the Bill is that it will impose a positive duty on all employers to take ‘reasonable and proportionate measures’ to eliminate unlawful sex discrimination, sexual harassment and hostile work environments, as far as possible.

The Bill aims to align with the recent changes to the model WHS laws, which now place a positive duty on employers to ensure, as far as reasonably practicable, the physical and psychological health and safety of workers.

Sexual harassment in the workplace has been governed in Australia by the Sex Discrimination Act 1984 (Cth) (SD Act), which specifically prohibits sexual harassment at work.

In 2018, a national inquiry into sexual harassment in Australian workplaces was announced. In 2020, the Australian Human Rights Commission (AHRC) released the Respect@Work: Sexual Harassment National Inquiry Report, which made 55 recommendations directed to all levels of government and the private sector for legislative and policy reforms to address sexual harassment in the workplace.

In 2021, the previous Coalition Government introduced laws adopting six of the 55 recommendations, including empowering the Fair Work Commission to issue stop-sexual-harassment orders (now section 789FF of the Fair Work Act 2009 (Cth)) and introducing sexual harassment as ‘serious misconduct’ for the purposes of summary dismissal.

On 28 September 2022, the Labor Government introduced the Bill to the Lower House.

What exactly are the proposed changes?

The key changes proposed in the Bill look to implement recommendations 16, 17, 18, 19, 23, 25 and 43 of the Respect@Work Report addressing:

1. prohibiting conduct that subjects another person to a workplace environment that is hostile on the ground of sex
2. introducing a positive duty on all employers and PCBUs to take ‘reasonable and proportionate measures’ to eliminate unlawful sex discrimination, including sexual harassment, as far as possible
3. enabling the AHRC to monitor and assess compliance with the positive duty in the SD Act
4. providing the AHRC with a broad inquiry function to inquire into systemic unlawful discrimination or suspected systemic unlawful discrimination
5. enabling representative bodies to make applications on behalf of people who have experienced unlawful discrimination in the federal courts
6. introducing cost protection to provide greater certainty to parties during court proceedings in relation to costs
7. bringing the Commonwealth public sector into line with the private sector by requiring Commonwealth public sector reporting against gender equality indicators to the Workplace Gender Equality Authority.

What do these changes mean?

      1. Subjecting a person to a hostile workplace environment on the ground of sex

The Bill proposes to amend the SD Act to introduce an express prohibition to protect people from hostile workplace environments on the ground of sex. The Bill sets out the meaning of subjecting a person to a hostile workplace environment, which includes:

a requirement that a reasonable person, having regard to all the circumstances, would have anticipated the possibility of the conduct resulting in the workplace environment being offensive, intimidating or humiliating to a person of the sex of the second person by reason of their sex or characteristics that generally appertain or are imputed to persons of their sex.

This means the conduct does not need to be directed at a specific person, but, instead, prohibits conduct that results in an offensive, intimidating and humiliating environment for people of one sex. This proposed amendment will have significant ramifications for employers in being required to proactively eliminate risky workplace behaviours that contribute to hostile work environments.

     2. Positive duty to eliminate unlawful sex discrimination

The Report observed that the current legal framework is not effectively preventing sexual harassment because it is focused on addressing and responding to conduct that has already occurred. This amendment is intended to shift this focus by requiring employers and PCBUs to proactively prevent discrimination and harassment in their workplaces.

The Bill would introduce a positive duty on all employers and PCBUs to take ‘reasonable and proportionate measures’ to eliminate, as far as possible, unlawful sex discrimination, including sex discrimination, sexual and sex-based harassment, hostile work environments and victimisation. This would not only require measures to be taken to prevent this conduct being engaged in by duty holders themselves, but also their employees, workers and agents, and third parties, where applicable.

     3. Enforcement of the positive duty

The Bill would insert enforcement mechanisms to ensure the positive duty is effective and employers engage with their legal obligations. New provisions in the AHRC Act would enable the Commission to monitor and assess compliance with the new positive duty, easing the burden on individuals by enabling the Commission to initiate action to address unlawful discrimination, rather than relying on individuals making complaints.

     4. Systemic inquiries into unlawful discrimination

In response to the Report’s findings that ‘there are significant cultural and systemic factors that drive sexual harassment in the workplace’, the AHRC will have the power to inquire into any matter that may relate to systemic unlawful discrimination, or suspected systemic unlawful discrimination. The Bill would define ‘systemic unlawful discrimination’ to mean unlawful discrimination that ‘affects a class or group of persons’ and ‘is continuous, repetitive or forms a pattern.’

This definition would enable the Commission to inquire into instances of unlawful discrimination within individual businesses, as well as instances of unlawful discrimination across multiple businesses within a broader industry or sector. It would also enable the Commission to inquire into businesses where it is suspected that unlawful discrimination may be occurring.

     5. Representative applications

The AHRC Act currently enables representative bodies, such as unions, to initiate a representative complaint in the Commission on behalf of one or more persons. Where matters are not resolved in the Commission, this change will enable representative bodies to bring applications in the federal courts under the SD Act on behalf of people who have experienced unlawful discrimination and sexual harassment.

     6. Costs protection provisions

The Fair Work Act 2009 (Cth) provides that costs may only be ordered against a party if the court is satisfied that the party instituted the proceedings vexatiously or without cause, or if the court is satisfied that a party’s unreasonable act or omission caused the other party to incur costs.

The current practice for Federal Court costs orders is that costs follow the event. This means that applicants may be liable for their own legal costs as well as the legal costs of the other party if they are unsuccessful. The Federal Court, of course, maintains discretion to award costs however it sees fit.

The Report found the current practice deters applicants from initiating court proceedings for sexual harassment complaints and creates access to justice concerns, particularly for vulnerable members of the community.

The changes in the Bill adopt a ‘cost neutrality’ approach to costs and would provide that, as a default position, each party would bear their own legal costs in SD Act proceedings. However, the courts would retain discretion to depart from this and make cost orders where they consider it just, having regard to a number of factors, including the financial circumstances of each of the parties to the proceedings and whether any party to the proceedings has been wholly unsuccessful in the proceedings.

The purpose of this change is to provide applicants with greater certainty regarding the costs they would be required to pay if they commence legal proceedings.

So, what will this mean for employers?

The current framework works retrospectively and places the onus on the individuals who experience sexual harassment to make a complaint. The proposed changes to the legislation aim to shift the burden from individuals to employers and PCBUs, requiring them to take a proactive approach. This imposes a much greater duty on employers and PCBUs to actively take steps to eliminate and prevent sexual harassment and unlawful discrimination on the basis of sex.

In line with Labor’s industrial relations strategy, it is intended that this Bill will be passed by Parliament before the end of the year. To ensure employers meet their new positive duty (if the Bill is in fact passed), employers should implement procedures to frequently assess and monitor their workplace culture. This can be done by providing appropriate support to workers and employees and delivering training and education on a regular basis.

The Respect@Work Council has also launched a new website aimed at assisting employers comply with their obligations to prevent and respond to sexual harassment and to support creating gender inclusive, safe, and respectful workplaces.

If you are an employer requiring assistance with implementing or reviewing workplace policies and procedures to ensure compliance with the new legislative requirements, please contact a member of our workplace relations team.