Given the silly season is approaching again, we thought it timely to remind our readers of the potentially serious dangers that can be created by work functions and behaviour that occurs outside of the “office”. In this article we review a case relating to conduct after a work function, which led to a total payment of more than $400,000 in damages[i].
The case[ii] related to 2 accountants who were engaged by different entities, but working in the same Melbourne office. The Applicant claimed that she had been verbally and physically sexually harassed by the Respondent over the course of several days and at different locations, including the workplace, a hotel and a taxi. She also alleged that after a work function she was physically assaulted by the Respondent in the corridor of the entrance to their office where he engaged in unwanted sexual intercourse with her.
The question in this case was whether the alleged sexual harassment occurred in the “workplace” of the Applicant and Respondent. There was an attempt by the Respondent to argue that the corridor at the entrance to the office did not come within the term “workplace”, but Justice Bromberg rejected this argument, finding that the aim of eliminating sexual harassment in the workplace would be seriously undermined if common areas such as lifts, corridors, kitchens or toilets were not within the scope of the Act. Justice Bromberg held that:
“the fact that the activity occurred out of working hours or that attendance was not for a work related purpose, does not affect the corridor’s characterisation as the workplace of both Mr Vergara and Ms Ewin…”[iii]
Justice Bromberg went further, and said:
“What makes a workplace animate are the people who work in it and the relations between them… “workplace” is not confined to the place of work of the participants but extends to a place at which the participants work or otherwise carry out functions in connection with being a workplace participant. [emphasis in the original]”
The implication of this is that the workplace can extend beyond the immediate office setting. In this case, the court was willing to find that the taxi was within the meaning of “workplace” as the parties were in the taxi on their way to KPMG’s office to perform their work duties. The court was also willing to find that a hotel and street were also within the meaning of “workplace” as the parties moved to these locations to deal with sexual harassment that had started in the workplace. The same reasoning could be used to find that any location is part of the workplace, as long as the parties are carrying out functions that are connected to their workplace.
The Respondent in this matter appealed to the Full Federal Court[iv], but his appeal was dismissed, with the judges unanimously upholding Justice Bromberg’s assessment of compensation awarded to the Applicant.
Ultimately, the Respondent was ordered to pay the Applicant $210,563 by way of compensation for physical sexual harassment, making it one of the largest court-ordered sexual harassment awards. The case also provides clarification on the meaning of “workplace” in the Sex Discrimination Act 1984 (Cth) (the Act), giving the term a potentially broad definition to include places outside of the office, which is significant to employers as it increases the potential vicarious liability of employers for conduct occurring in places outside of the office, and to conduct occurring outside of work hours.
So this case is a timely reminder of the importance to employers to ensure that they have systems and policies in place that address the reporting, investigation and addressing of inappropriate behaviour in the workplace. There is a risk to employers of vicarious liability, so employers have an important responsibility to take allegations of sexual harassment seriously. Employers should, as a minimum:
- have clear policies that condemn sexual harassment
- educate staff of their responsibility to avoid sexual harassment outside of the immediate workplace and events that are related to their work
- promptly and carefully investigate any claims of sexual harassment, and
- have in place a transparent process that effectively investigates complaints.
If you would like advice about an employment related issue you may be having, send an email enquiry to [email protected] or phone us on 02 8006 0830 and we will organise a time for a confidential discussion.
[i] Initially the Applicant was awarded $476,163 in damages, but the court took into account the settlement she reached with her employer and the Respondent’s employer and so to avoid double recovery, ordered the respondent to pay $210,563. The total award of $476,163 is one of the largest awards of general damages under the Sexual Discrimination Act.
[ii] Ewin v Vergara (No. 3)  FCA 1311
[iii] Ewin v Vergara (No. 3)  FCA 1311 at paragraph 38.
[iv] Vergara v Ewin  FCAFC 100 (12 August 2014)
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