Two recent decisions in the Queensland Civil and Administrative Tribunal and the New South Wales Administrative Decisions Tribunal provide a useful guide concerning the steps employers can take to mitigate against a finding they are vicariously liable for employee conduct constituting sexual harassment.

Menere v Poolrite Equipment Pty Ltd and Anor (2012) QCAT 252

The complainant, Mr Menere, commenced employment with Poolrite Equipment Pty Ltd (Poolrite) on 25 February 2008 as a casual assembly line worker. Between early March and late June 2008, Mr Menere alleged that he was subjected to numerous instances of conduct amounting to sexual harassment by Mr Singh (another Poolrite employee), including the stroking of pipes in Mr Menere’s direction, lewd questions regarding Mr Menere’s bodily fluids and Mr Singh’s groin being pressed up against Mr Menere’s head and buttocks.

Mr Menere claimed that his line manager, Mr Morton, either witnessed, or was made aware of several of these incidents, but took no action to prevent Mr Singh’s behaviour. Under cross examination, Mr Menere stated that, until one particularly objectionable incident that occurred on 26 June 2008, he chose not to make a complaint to more senior management, because he relied on Mr Morton to speak with Mr Singh on his behalf.

In response, Poolrite gave evidence that all employees, including Mr Menere and Mr Singh, were required to complete an induction process before commencing employment that included a review of Poolrite’s policy manual. The manual contained a detailed policy identifying and prohibiting sexual harassment in the workplace and encouraging employees to lodge complaints with management where they believed such conduct was occurring.

In addition to having a sexual harassment policy in place, Poolrite took the following steps to ensure compliance with the policy:

  1. providing training in the terms of the sexual harassment policy in October 2007 and September 2009;
  2. on 16 July 2008, Poolrite’s Workplace Health and Safety Officer (WHSO), attended a meeting between Mr Menere and Mr Singh convened at Mr Menere’s request to provide the employees an opportunity to discuss Mr Menere’s allegations, at the conclusion of which Mr Menere declined an invitation from the WHSO to make a formal complaint about Mr Singh’s behaviour; and
  3. on 18 July 2008, commenced an investigation into a formal complaint from Mr Menere against Mr Singh, which resulted in Poolrite finding the allegations had been substantiated and that the conduct amounted to sexual harassment. Poolrite then summarily dismissed Mr Singh.

The Tribunal ruled that, although Mr Singh’s conduct amounted to sexual harassment in breach of section 118 of the Anti-Discrimination Act 1991 (Qld), which resulted in an award of damages against him, Poolrite was not vicariously liable for the conduct, as it had taken reasonable steps to prevent Mr Singh from contravening the legislation by having a policy in place and taking positive measures to ensure awareness and compliance in the workplace.

Hughes v Narrabri Bowling Motel Limited (2012) NSWADT 161

The complainant, Mrs Hughes, commenced employment with the Narrabri Bowling Motel Limited (Motel) as a casual housemaid in July 2008. In June 2010, Mr and Mrs Welsh were employed as motel managers. A committee of 3 members from the Bowling Club that operated the Motel were responsible for overseeing the conduct of the business.

Mrs Hughes alleged that Mr Welsh made unwelcome sexual advances to her in January and August 2010 by brushing up against her in one of the rooms, then made a request for sexual favours during a further incident in August 2010. Mrs Hughes alleged that the Motel was vicariously liable for Mr Welsh’s conduct, as she was informed by one of the committee members that they were aware of previous complaints of similar conduct against Mr Welsh at the date he was employed by the Motel and that no action was taken by the committee following her complaint in August 2010.

In reply, the Motel gave evidence that all 3 committee members attended at the Motel the day after receiving Mrs Hughes’ complaint and conducted interviews with all staff members regarding Mr Welsh’s behaviour. The committee members denied having knowledge of previous sexual harassment allegations against Mr Welsh at the date he was employed by the Motel, or advising Mrs Hughes of this. Following the investigation, the committee spoke to Mr Welsh about the allegations against him. Although Mr Welsh was not terminated as a result of the investigation, it was the evidence of all employees appearing at the hearing, including Mrs Hughes, that Mr Welsh did not engage in any further inappropriate conduct of a sexual nature after this time.

In finding that the Motel was not vicariously liable for Mr Welsh’s actions under section 53 of the Anti-Discrimination Act 1977 (NSW), the Tribunal noted that the committee members had acted swiftly upon receipt of Mrs Hughes’ complaint by commencing an investigation into Mr Welsh’s conduct the following day that resulted in the counselling of Mr Welsh, against whom no subsequent complaints have been made. The Tribunal commented that: “It is difficult to envisage what more an employer could have done, short of prevention”. Damages were awarded against Mr Welsh personally in respect of the sexual advance in August 2010.

Implications for employers

In order to limit exposure to vicarious liability for the actions of employees engaging in conduct amounting to sexual harassment in the workplace, employers should implement the following measures:

  1. provide and maintain a written policy on sexual harassment in the workplace;
  2. provide regular training to employees in the terms of the policy;
  3. provide and implement an effective grievance procedure;
  4. take contemporaneous notes of all meetings with employees during which allegations of sexual harassment are discussed; and
  5. take all complaints seriously and conduct a timely investigation.