Under our anti-discrimination laws, an employer can avoid vicarious liability for its employees' actions if it took “all reasonable steps” to prevent the conduct.

Workplace policies on prohibited conduct are an essential, but not sufficient, tool in demonstrating reasonable steps.

We’ve previously reported on the decision in Richardson v Oracle Corporation Australia here. That case concerned (very expensive) findings of sexual harassment by one employee of another. Oracle sought to avoid vicarious liability by relying on its workplace policies, and employee training, which made clear sexual harassment was prohibited in the workplace. 

However, the Court found the content lacking. Rather than being tailored to the Australian legislation, the Court determined that the head office US content had simply been rolled out in Australia and that it was not sufficient. 

More recently, Australia Post has also failed to avoid vicarious liability for discriminatory acts by its employee. The Court accepted that an Australia Post worker made racially abusive comments amounting to a breach of the Racial Discrimination Act 1975, including calling a fellow worker “a f*ing black bastard”, and suggesting he should go back to Sri Lanka. 

By contrast to the Oracle example, the Court found the content of the workplace policies, the method of dissemination, and the training conducted, was “wholly exemplary”.

So what went wrong? Enforcement. Ah, that old chestnut. The Court found the absence of an effective response, and “a curious lack of engagement”, when complaints of discrimination were raised. 

The moral to the story? Employers need to walk the talk. Investigate all complaints, and treat them as seriously as your policy says you will.