The recently handed down Federal Court appeal decision in Oracle is a warning to all employers about taking all reasonable steps to prevent vicarious liability due to one of their staff acting unlawfully.
In this case a male employee, Randol, Tucker sexually harassed a female employee, Rebecca Richardson, over a six month period.
Richardson sued her employer on multiple grounds but the one that stuck was alleging that her employer had not taken all reasonable steps to prevent Tucker from sexually harassing her.
The court accepted that Tucker had sexually harassed Richardson and they also accepted that once notified the employer conducted an appropriate investigation-so a big tick for Oracle doing this.
Where Oracle fell down was in the education of their staff about what constitutes sexual harassment and discrimination. Oracle provided an on-line generic training program that was not specific to Australian laws. The trial judge held that the generic module was deficit in certain areas, particularly that it did not mention there are Australian laws to protect employees from sexual harassment and discrimination and that employers can be vicariously liable for the actions of its employees.
Richardson was awarded only $18,000 for her pain and suffering (non-economic loss) as a consequence of her sexual harassment claim. Richardson appealed this decision and on appeal the court held that the compensation Richardson received was inadequate and increased it to $130,000.
This case is a reminder to all employers that the onus is on them to educate their staff appropriately in relation to the laws that exist in Australia, that protect employees from sexual harassment and discrimination. This case is also letting employers know that the benchmark for what is a reasonable payout has just been increased significantly.
If you are unsure about what your legal requirements are then contact EEO Specialists for a complimentary risk assessment, on (08) 6102 4411. We offer in-person training and a range of on-line modules to meet the legislative requirements.