$150,000 in damages imposed against employer

Our most recent eNews addressed the vicarious liability imposed on employers for the discriminatory actions of employees and it summarised the reasonable steps an employer must take to defend against vicarious liability.

Highly relevant to this topic, is the recent decision of Oliver v Bassari (Human Rights) [2022] VCAT 329 (28 March 2022). In this case, both the female applicant and male co-worker were employed by a male beauty therapy company, trading as “Man Oh Man”. During the applicant’s employment from January to November 2018, the co-worker repeatedly perpetrated acts of sexual harassment on her. This conduct escalated until finally, the co-worker sexually assaulted the applicant, following which she resigned.

After the applicant commenced legal proceedings against Man Oh Man and its sole director, the respondent argued it was not liable. In support, the respondent pointed to an anti-discrimination and equal opportunity policy which employees could access electronically. In judgement, however, the tribunal found this was insufficient, on grounds that: 

  • The handbook was merely discussed “in a rudimentary manner” in a one-off staff meeting.
  • There was no evidence the co-worker ever read or accessed the handbook.
  • There was no evidence of any handbook-specific training. 
  • There was no evidence the employees understood the training. 

Additionally, and before the sexual assault, the applicant twice complained to the sole director about the co-worker’s behaviour. In response, the sole director simply spoke to the co-worker, who apologised and warranted the behaviour would not occur again. The tribunal held this was a “manifestly inadequate” response to sexual harassment.

On the above basis, the tribunal found Man Oh Man vicariously liable for failing to prevent sexual harassment and assault by a male co-worker. Accordingly, the tribunal ordered Man Oh Man to pay $150,000 in damages to the applicant.

This decision is a timely reminder of the importance of introducing measures to reduce the risk of sexual harassment in the workplace. A court will not excuse an employer merely because it: (1) is a small business; (2) has a seldom used anti-discrimination policy; or (3) went through the motions in responding to a sexual harassment complaint.

Disclaimer: This summary is a guide only and is not legal advice. For further information on employers’ legal obligations, call ECA Legal Pty Ltd on (08) 6241 6129 or email ecalegal@ecawa.org.au.