On 15 July 2014, the Full Court of the Federal Court handed down a decision that changes the monetary landscape for sexual harassment claims.

This was an appeal against a decision of Justice Buchanan in February 2013, when he ordered Oracle to pay its employee, Ms Richardson:

  • $18,000 in general damages (for pain and suffering); and
  • over $9,340 for medical expenses.

Ms Richardson had made claims against a colleague, Mr Tucker, of sexual harassment occurring over a seven month period. The incidents complained of included a number of instances of inappropriate behaviour, including repeated unwelcome requests to go out on dates, comments of a sexual nature and comments involving sexual innuendo. Justice Buchanan accepted that Mr Tucker had engaged in sexual harassment against Ms Richardson and accepted that Oracle was vicariously liable for the conduct of Mr Tucker.

Ms Richardson also alleged that Oracle’s handling of the investigation caused her harm, amongst other reasons, because she was required to stay in contact with Mr Tucker for the duration of the investigation. While Justice Buchanan accepted that it would have been difficult for her to continue to have this interaction, he did not accept that she had suffered a loss as a result of the way the investigation was conducted.

Despite having succeeded in her substantive application, Ms Richardson was also ordered to pay Oracle’s costs because she had rejected a settlement offer before trial.

Ms Richardson appealed Justice Buchanan’s decision, in particular in relation to the quantum of the damages.

In deciding the case, the Full Court observed that orders for damages in sexual harassment cases had not kept pace with community expectations and awards in other litigious matters. Accordingly, the Full Court determined that the award of $18,000 in general damages was manifestly inadequate and ordered that Oracle instead pay Ms Richardson $130,000 in general damages. The Full Court also awarded Ms Richardson costs in the appeal, and invited her to make submissions on the question of costs in the original trial.

This decision flags the likelihood of a general increase in the damages awarded in future to victims of sexual harassment. It is also another reminder that employers must have policies in place which clearly identify unlawful behaviour (such as discrimination, harassment, sexual harassment and bullying) and must induct all staff into these policies, with refresher training sessions as required.