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Workplace sexual harassment compensation trends

This help sheet has been prepared by Moores, not-for-profit legal advisers.

Community expectations and attitudes are changing in relation to sexual harassment in the workplace. A 2010 sexual harassment claim by former David Jones employee Kristy Fraser-Kirk, which reputedly settled for $850,000, helped shine a spotlight on the issue of sexual harassment in the workplace.

But despite the increase in public awareness, reporting rates in Australia are very low: only one in five people who have been sexually harassed report the harassment, according to Sex Discrimination Commissioner Elizabeth Broderick.

What is sexual harassment?

Under the Sex Discrimination Act 1984 (Cth) , sexual harassment is defined as unwelcome conduct of a sexual nature which makes a person feel offended, humiliated or intimidated, in circumstances in which a reasonable person would have anticipated that the person being harassed would feel that way.

What are the consequences?

Victims of sexual harassment commonly experience adverse effects on their health and wellbeing, not to mention low performance and morale at work. At the same time, the detrimental effects for the workplace can include low productivity, reputational damage, low staff retention and high workers' compensation premiums (resulting from claims).

How much is typically awarded?

In sexual harassment cases courts have, until recently, awarded damages in the range of $12,000 to $20,000. However, in two recent decisions, courts have demonstrated a willingness to award much larger amounts in damages to victims of sexual harassment.

In Richardson v Oracle Corporation Australia Pty Ltd [2014] FCAFC 82, Justices Kenny, Besanko and Perram of the Full Court of the Federal Court increased a former employee's overall award of damages from the "manifestly inadequate" amount of $18,000 to $130,000 for compensation for pain and suffering and loss of enjoyment of life.

In Trolan v WD Gelle Insurance and Finance Brokers Pty Ltd [2014] NSWDC 185, the NSW District Court upheld an employee's claim against her former employer for a psychological injury she incurred as a result of systematic sexual harassment, intimidation and bullying by a director of the company. The court awarded her $733,723 in damages.

How can employers meet their obligations?

You must be able to show that your organisation has taken all reasonable steps to prevent employees from engaging in sexual harassment. You can do this by implementing a variety of measures to minimise the exposure of your organisation:

  • introduce a sexual harassment policy (if you do not already have one);
  • review the policy regularly to ensure compliance with best practice;
  • deliver training to all new employees on the policy and its application;
  • provide regular refresher policy training to all staff; and
  • ensure that you and your managers implement the policy.
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