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Australia – It’s Been Two Years Since THAT Sexual Harassment Claim: What Have You Done To Address The Risks?

21 October, 2012

 

Legal News & Analysis – Asia Pacific – Australia – Labour & Employment

 

In brief

 

  • Today, 18 October 2012, is the second anniversary of Kristy Fraser-Kirk settling her landmark sexual harassment claim against David Jones (according to media reports).
  • Since October 2010, there have been a number of developments toward greater regulation of workplace behaviour (and so exposure to risk for employers), particularly in the areas of bullying and gender equality. In light of these developments, there is scope for many organisations to strengthen their compliance audits to better manage these risks.
  • In this Employment Alert we consider the impact of the Fraser-Kirk claim, some of the moves toward greater regulation of workplace behaviour made since then, and steps some employers are taking to address these issues. We also include a compliance checklist for assessing and managing employer risk in this area

 

The impact of the Fraser-Kirk claim

 

The Fraser-Kirk claim was novel for three key reasons: the nature of the legal claims made, the amount of damages sought and the amount of publicity generated.

 

The claim was filed in early August 2010. In the 2010/2011 financial year, there was a 22% increase in sexual harassment complaints across all jurisdictions combined, compared to the previous year (suggesting that the claim, unsurprisingly, drew more attention to this area). There was a similar increase in sexual harassment claims in most jurisdictions for the same period:

 

Australian Human Rights Commission 31.84% increase
Victoria 33.5% increase
Queensland 25% increase
NSW 20.69% increase
Western Australia 5.88% increase

 

How has workplace behaviour become more regulated since October 2010?

 

Since October 2010, there have been a number of developments toward greater regulation of workplace behaviour. These include:

 

  • The ASX Corporate Governance Principles and Recommendations on diversity came into effect 

 

These recommendations came into effect for financial years commencing on or after 1 January 2011. They provide a voluntary framework for reporting on corporate governance. ASX listed companies are required to disclose in their annual report the extent to which they have not followed the recommendations. The recommendations include:

 

  • Establishing and disclosing a diversity policy, including requirements for the Board to establish measurable objectives for achieving gender diversity 
  • Disclosing in each annual report the measurable objectives for achieving gender diversity and progress towards achieving them
  • Disclosing in each annual report the proportion of women employees in the whole organisation, in senior executive positions and on the Board.

 

  • Adverse action claims under the Fair Work Act 2009 (Cth) continue to increase

 

Adverse action claims under the general protections provisions of the Fair Work Act 2009 (Cth) seem to have become the claim of choice for employees, and are an alternative to commencing a claim in an anti-discrimination tribunal. According to its 2010-11 Annual Report, Fair Work Australia received 2,375 general protection applications from 1 July 2010 to 30 June 2011. For the three quarters from July 2011 to March 2012, Fair Work Australia received 2,037 general protection applications, nearly 88% of the number received in the previous year, with another quarter still to go. These figures suggest that adverse action claims are continuing to increase.

 

  • The Federal government has proposed the Workplace Gender Equality Act (with increased compliance and reporting obligations)

 

The Equal Opportunity for Women in the Workplace Amendment Bill 2012, which has passed the House of Representatives and is currently before the Senate, proposes the creation of this new Act. It will change EEO reporting requirements, obliging relevant employers to report annually against gender equality indicators. The gender equality indicators include the gender composition of the workforce and governing bodies of the employer, equal remuneration between women and men, availability and utility of flexible work, and consultation with employees about gender equality in the workplace. The new Act also proposes public access to reports provided by employers, and requires employers to notify employees and shareholders of how they may access the report after it is lodged. Non-compliance with the Act may result in an employer being named, both to the Minister and publicly.

 

  • Victoria codified bullying in its Crimes Act

 

In June 2011 the Victorian Government passed amendments to its Crimes Act. The amendments extended the definition of the existing offence of “stalking” to include “serious bullying”. The change was a response to the Café Vamp case which resulted in a young female employee, Brodie Panlock, committing suicide after being subjected to serious bullying in the workplace.

 

  • The Federal government appointed a review to consider the need for bullying laws

 

The Federal review is due to report by 30 November 2012.

 

  • New Work Health and Safety (WHS) laws have been introduced in some jurisdictions with greater personal liability (and the potential for criminal prosecution) for workers and officers of a “person conducting a business or undertaking”

 

WHS laws have always had scope to cover complaints about workplace behaviours, however traditionally, most workplace behaviour claims have been brought in anti-discrimination tribunals. The new model WHS laws, which have been adopted by the ACT, NT, NSW, Tasmania and Queensland, increase the risks for “officers of a PCBU” (persons conducting a business or undertaking). The adoption of the WHS laws is still being debated in Western Australia and South Australia. Victoria has stated that it will not adopt the new WHS laws.

 

  • Many jurisdictions have implemented Codes of Practice (under safety laws) to manage workplace bullying

 

ACT, Western Australia and Queensland have all implemented Codes of Practice under the new WHS laws to address workplace bullying. These Codes have legislative force because they have been implemented under WHS legislation. Codes of practice are admissible in court proceedings and may be used as evidence of what is known about a hazard, risk or control and may be relied upon in determining what is reasonably practicable in the circumstances.

 

  • Safe Work Australia has consulted on and is preparing a model Code of Practice about responding to workplace bullying

 

Safe Work Australia is developing a model Code of Practice for adoption by the jurisdictions which have adopted the model WHS laws, being ACT, NT, NSW, Tasmania and Queensland. Like the other Codes, it will have legislative force and will be admissible in court proceedings.

 

Organisational responses to increased regulation of workplace behaviours

 

In the past two years, there has been increased scrutiny of employers’ gender diversity practices, and the incidence of workplace sexual harassment. Various organisations and interest groups have released reports addressing gender equality and raising the profile of inappropriate workplace behaviours. These include:

 

  • Australian Human Rights Commission (AHRC) has commissioned new projects investigating workplace gender inequality and sexual harassment

 

In 2012, AHRC launched two research projects investigating gender inequality and approaches to sexual harassment. The “Women in Male Dominated Industries Project” aims to identify recruitment and retention strategies that workplaces can implement to improve women’s representation and leadership in male dominated industries such as mining, utilities and construction. The second project released its report “Encourage, Support, Act! Bystander approaches to sexual harassment in the workplace” in June 2012 and recommended a number of strategies to encourage bystander intervention to reduce sexual harassment incidents.

 

  • Victorian Equal Opportunity and Human Rights Commission (VEOHRC) survey finds high levels of workplace harassment for young women

 

A VEOHRC survey, released in June 2011, found that significant numbers of Victorian women aged 15-30 continue to experience sexual harassment in the workplace. Of the 428 women surveyed, 22% reported sexual harassment at work, and 15% had resigned from work due to sexual harassment.

 

  • Male Champions of Change has released a report profiling company experiences in elevating the representation of women in leadership

 

The Male Champions of Change is a group of prominent male CEOs and Chairpersons who work collaboratively with the Sex Discrimination Commissioner, Elizabeth Broderick, to promote gender balanced leadership. In October 2011, the Male Champions of Change released a publication, “Our experiences in elevating the representation of women in leadership: a letter from business leaders” profiling the actions taken by member companies to increase the numbers of female senior managers within their organisations. 

 

  • ASX has released a report commissioned from KPMG analysing the diversity disclosures of listed companies

 

In July 2012, the ASX released an independent report from KPMG about the adoption levels by listed companies of the ASX Corporate Governance Council’s recommendations on gender diversity. The report found that 61% of companies sampled had established a diversity policy, and 36% had measureable objectives for obtaining gender diversity.

 

Employer responses to increased regulation of workplace behaviour

 

Many employers have already begun implementing strategies and programs designed to strengthen gender equality and educate employees about inappropriate workplace conduct. The strategies used include:

 

  • setting diversity targets at each management level
  • encouraging mentoring
  • sponsoring targeted development programs for women
  • education based activities
  • networking events
  • supporting training
  • making senior executives and managers accountable for workplace culture and behaviour
  • strengthening incentives to support women returning from parental leave
  • setting female recruitment targets
  • unconscious bias training for team leaders; and
  • enhanced flexible workplace programs.

 

Nevertheless, there is still scope for many employers to strengthen their compliance audits to better manage their risks in light of the move toward greater regulation of workplace behaviour since October 2010.

 

The Compliance checklist below is designed to assist in this risk management process.

 

There is scope for many organisations to strengthen their compliance audits. To better manage their risks in light of the move toward greater regulation of workplace behaviours since October 2010.

 

Compliance Checklist – Has your organisation:

 

Policies

  • Recently reviewed/updated its existing anti-discrimination, harassment and bullying (EEO) policies to comply with current law?
  • Identified which bullying definition (and Code), if any, applies to your operations? Reviewed existing policies to ensure bullying is covered?

 

Training 

 

  • Trained the Board and senior executives in the last 2 years on appropriate workplace behaviours, and their obligations under contract and your EEO (and related) policies?
  • Trained managers in the last 2 years on appropriate workplace behaviours and their obligations under your EEO (and related) policies?
  • Trained employees in the last 2 years on appropriate workplace behaviours and their obligations under your EEO (and related) policies?
  • Trained all staff who investigate complaints about your investigation procedure and procedural fairness?
  • Trained all decision-makers on adverse action, victimisation and discrimination laws?

 

 

Enforcement

 

  • Put in place a different complaint procedure for when the subject of a complaint is a senior executive?
  • Actively managed “known” people of risk (eg rumoured bullies and flirts)
  • Reviewed complaint statistics for trends that need to be addressed?
  • Actively enforced and followed your policies and procedures relating to workplace behaviours?
  • Sent a clear and consistent message through all levels of the workforce that inappropriate workplace behaviour will not be tolerated?
  • Put in place procedures for reporting to the Board on EEO/workplace behaviour issues?
  • Taken steps to address an inappropriate workplace culture (if applicable)?
  • Undertaken an employee engagement survey?

 

 

Other measures

 

  • Implemented measures to actively incentivise the CEO and senior executives to demonstrate positive leadership to manage and prevent inappropriate workplace behaviour?
  • Determined measurable objectives for obtaining gender diversity as required by the ASX recommendations on diversity (eg recruitment targets and increased female representation in senior roles)?
  • Ascertained if your customers have diversity requirements of their suppliers?
  • Reviewed your insurance policy to check coverage (and limits) for workplace behaviour claims?

 

  

 

For further information, please contact:

 

 

 

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