A recent decision of the Full Federal Court has highlighted the issue of sexual harassment and set a new precedent in the awarding of damages to employees who are victims of sexual harassment in the workplace.
The decision in Richardson v Oracle Corporation Australia Pty Ltd [2014] will likely see a huge increase in the damages awarded to employees. In this case the employee was originally awarded $18,000 in damages for unlawful sexual harassment.
The employee was awarded this amount following unlawful sexual harassment, which occurred over several months, at the hands of a sales representative who made sexual comments and innuendo about the employee both privately and in front of colleagues. The court found the employer vicariously liable for the behavior of the sales representative and awarded damages to the employee.
The employee appealed the original decision of the court on a number of grounds and was successful in her appeal as the court found that the trial judge in the original case failed to properly take into account the effect the sexual harassment had on the employee’s sexual relationship with her partner.
The court found that while the original award of damages in the amount of $18,000 was within the previously accepted range of damages awarded in sexual harassment cases, it was the opinion of the court that community standards had changed and now accorded a higher value to compensation for pain and suffering and loss of enjoyment of life than before. This trend originated in personal injury cases and the court carried this principle across to this sexual harassment case.
As a result the court ruled that the original award of damages was manifestly inadequate and increased the employee’s award of damages from $18,000 to $100,000. The court also found that a sufficient connection existed between the sexual harassment and the employee’s decision to leave her job and awarded her an additional $30,000 in compensation for loss of income.
The court did however reject the employee’s claim that the investigation into the sexual harassment launched by the employee further contributed to the loss and damage she suffered, stating that damages can only be awarded as compensation for the loss an employee suffers as a direct result of the sexual harassment itself.
Whilst it may have caused distress to the employee, the employer was correct to launch an investigation into the sexual harassment of the employee.
In summary the court dramatically increased the amount of compensation awarded to the employee from $18,000 to $130,000, setting a precedent for a massive increase in the amount of damages that may be payable to an employee who falls victim to sexual harassment in the workplace.
This decision should serve as a wake-up call to employees and spur them into action to be proactive about sexual harassment in the workplace and put into place strategies that can prevent its occurrence, or identify it early to lessen the damage that an employee suffers as a result.