New sexual harassment obligations for employers under the Respect@Work Act: a positive and proactive approach

During this time, the Federal Court of Australia has awarded a landmark payout to an employee who was sexually harassed by her boss at work. The case carefully considers the meaning of sexual harassment and deals with whether giving gifts, making comments about an employee’s body, declarations of romantic feelings and an inappropriate slap constitute sexual harassment.

Employers should pay careful attention to this benchmark payout when considering their risk mitigation approach to the positive duty to prevent sexual harassment in the workplace.

In this article, we provide a brief reminder of the changes to the sexual harassment laws, summarise the landmark judgment and provide the key takeaways for employers.

Background

In March 2020, the Respect@Work: Sexual Harassment National Inquiry Report was delivered and outlined 55 recommendations to better prevent and respond to sexual harassment in the workplace.

In April 2021, the Coalition Government delivered A Roadmap for Respect: Preventing and Addressing Sexual Harassment in Australian Workplaces. This document responded to all 55 of the AHRC’s recommendations as outlined in the Report.

In September 2021, the Sex Discrimination and Fair Work (Respect at Work) Amendment Act 2021 was enacted, which implemented a number of these recommendations. Concerns were raised by some stakeholders that these amendments did not go far enough in responding to the recommendations in the Report.

Just over a year ago, on 12 December 2022, the Anti-Discrimination and Human Rights Legislation Amendment (Respect at Work) Act 2022 (Cth) (the Act) came into effect. The Act built on the 2021 amendments to the Sex Discrimination Act 1984 (Cth) (the SD Act) and the Australian Human Rights Commission Act 1986 (Cth) (the AHRC Act).

In summary, the following significant amendments affecting employers would be introduced:

• imposing a positive duty on employers to eliminate sex discrimination, sexual harassment and victimisation
• expanding time limitations for a sexual harassment complaint to be made from 6 months to 24 months
• prohibiting workplaces from facilitating a hostile workplace environment
• lowering the threshold for sex-based harassment and reducing the requirement for conduct to be ‘seriously demeaning’ to ‘demeaning’
• empowering the AHRC to monitor employers’ strict compliance with the positive duty
• amend the AHRC Act to allow representative bodies, such as unions, to make applications to the Federal Court on behalf of victims of unlawful discrimination
• insert a costs protection provision into the AHRC Act that offer parties greater clarity as to the costs they will incur when commencing sexual harassment proceedings
• extend gender equality reporting obligations to the public sector.

Federal Court orders landmark payout

Late last year, in the midst of the introduction of these amendments to the national sexual harassment laws, a record amount of damages was paid to an employee found to have been sexually harassed during her employment. In Taylor v August and Pemberton Pty Ltd [2023] FCA 1313, the Federal Court of Australia ordered the owner of a jewellery store, Mr Grew, and his company to pay over $268,000 in damages for the sexual harassment and victimisation of a female employee, Ms Taylor.

Ms Taylor commenced proceedings against Mr Grew for unlawful sexual harassment (and ultimately contravening section 28B(2) of the SD Act) over a period of 22 months while employed at Mr Grew’s store. Mr Grew’s behaviour included slapping Ms Taylor on the bottom and sending numerous text messages confessing romantic feelings.[1]

While the Court was not required to consider whether the employer breached the new positive duty in this case because the conduct occurred before the reforms, the findings and compensation ordered set a new benchmark for general damages in sexual harassment cases. Given the positive duty is now in force, it is unlikely the Court will shy away from awarding damages of this calibre for future sexual harassment.

What is the positive duty and what can employers do?

The positive duty imposes a legal obligation on employers to take a proactive and meaningful approach to prevent relevant unlawful conduct from both occurring in the workplace and in connection to work.

Following the commencement of the Australian Human Rights Commission’s (AHRC) new functions and powers to monitor, assess and enforce compliance with the new positive duty on and from 12 December 2023, the AHRC now has the power to:

• inquire into employers or other persons conducting a business or undertaking (PCBU) if the AHRC reasonably suspects non-compliance with the positive duty
• following the inquiry, issue a compliance notice if required
• apply for a Court order (in either the Federal Court or Federal Circuit and Family Court of Australia) to enforce the compliance notice
• enter into enforceable undertakings with an employer or a PCBU.

Together with the standards set by Taylor v August and Pemberton Pty Ltd and the AHRC’s new expanded powers, employers should be aware of sexual harassment issues more than ever. Ultimately, this requires employers to actively prevent and eliminate workplace sexual harassment, sex discrimination and related conduct as much as reasonably possible, as opposed to only responding once it has occurred.

What can Taylor v August and Pemberton Pty Ltd teach employers?

Taylor v August and Pemberton Pty Ltd serves as an important lesson for employers, as it demonstrates that the Courts are willing to award substantial financial penalties to employers who have breached their obligations.

Additionally, section 106 of the SD Act renders a person or company vicariously liable for sexual harassment or unlawful related actions committed by its employees or agents, unless all reasonable steps were taken to prevent that conduct. As such, Mr Grew’s company would still be liable, even if he was merely an employee.

Key takeaways

In light of this, it is important for employers to ensure sufficient preventative measures are in place to ensure compliance with the positive duty. Employers should:

• ensure the existence of a sexual harassment policy, and conduct regular reviews of any previously implemented policies and frameworks and updating them to reflect a new obligations and standards of behaviour
• ensure strong and diverse role models at a senior level, to encourage and enforce the expected behaviours within the workplace
• provide regular sexual harassment training for all levels, discussing the requirements of the SD Act so that employees understand their workplace responsibilities
• have strong, effective and accessible complaint pathways for complainants, and ensure all complaints are taken seriously
• take prompt and proportionate actions when a breach occurs.

Employers are also encouraged read the AHRC’s Guidelines for Complying with the Positive Duty, which provide practical guidance to help employers understand their obligations and required actions.

[1]           Taylor v August and Pemberton Pty Ltd [2023] FCA 1313