Employment Services & Solutions Australia | $1.36 Million Compensation in Sexual Harassment Case
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$1.36 Million Compensation in Sexual Harassment Case

We have been advising clients for some time now about the increasing risks faced by employers in the areas of sexual harassment and workplace bullying.  Yesterday, the Victorian Supreme Court reinforced that message by awarding a massive payout to an employee that was subject to repeated sexual harassment and bullying at the workplace.

Kate Mathews was employed by Winslow Constructors as a road construction worker.

The Court found that Ms Mathews was subject to repeated verbal and physical harassment by other staff at the business and management failed to act on her complaints.  This resulted in Ms Mathews developing a serious chronic psychiatric illness which the Court found was so serious that she is unlikely to be able to work again.

The abuse included calling her names, touching her inappropriately, threatening her with sexual violence and asking her about her sexual activities.

The compensation figure included amounts for past and future earnings and for pain and suffering.

Winslow actively contested the claim and undertook video surveillance of Ms Mathews to try and disprove her position.

It is apparent that the trial didn’t go so well for Winslow because after five days of the anticipated seven day hearing, Winslow suddenly admitted liability.

The costs to Winslow will be enormous.  Not only do they have the issue of the compensation amount to deal with, given the length of the trial and the activities undertaken to disprove her claim, there will also be considerable costs associated with the legal processes.  These costs are in addition to the reputational damage suffered by the company which will be significant given the conduct that resulted in the claim and the failure of the company to adequately deal with the issue.

The Court has sent a clear message to business operators; sexual harassment, other forms of harassment and bullying will not be tolerated. 

Business owners must proactively address this issue by ensuring that they have correctly drafted policies that deal with these areas and that staff and management understand these policies.  However, this is not enough on its own.  If a complaint is made, or conduct is observed that could constitute sexual harassment or bullying, the employer must deal with it seriously and in a manner that ensures that the issue is addressed.

Dealing with these types of claims is time consuming and costly.  Whilst most claims in this area don’t result in such large payouts, they still regularly result in monetary settlements and considerable costs to achieve those settlements.  Claims in this area are increasing in number by 20% per year.  Business owners are vicariously liable for the actions of their employees in this area, unless they can demonstrate that they have the appropriate policies and procedures in place to prevent harassment from occurring.  Just because the employer is not the perpetrator does not mean they are not liable.

Employment Services & Solutions Australia can assist employers by providing the appropriate policy documentation and training staff and management in the understanding of those policies.  If you have any queries in relation to the content of this article, please call our office on 9240 4230.