In April this year, the Federal Circuit Court ordered a small business and its two owners to pay over $200,000 in compensation and penalties for engaging in pregnancy discrimination.

This decision, Sagona v R & C Piccoli Investments Pty Ltd (Sagona)1, was handed down in the same month  that the Australian Human Rights Commission (AHRC) released national data showing that 49% of women reportedly experience discrimination  in the workplace at some point during pregnancy, parental leave or on their return to work.2

Both the decision and the report serve as a timely reminder to employers to ensure that they take all reasonable steps to avoid pregnancy and related discrimination in the workplace.

Court awards $200,000+ for pregnancy discrimination and adverse action

Samantha Sagona had worked for her employer, a small family-run photographic business for over 12 years.  The owners of that business, Mr and Mrs Piccoli, were planning  for their retirement. They had told Ms Sagona of their plans to leave the day- to-day running of the business to their son (also an employee) and Ms Sagona.

However, things changed in September 2012, when Ms Sagona informed Mr and Mrs Piccoli that she was pregnant. Ms Sagona told her employer that she planned to take a short period of maternity leave in March 2013 and wished to return part-time thereafter.

After the initial congratulations, Mr and Mrs Piccoli’s attitude towards  Ms Sagona cooled.  Ultimately, the Court found that they engaged in the following conduct which constituted unlawful discrimination and adverse action, forcing Ms Sagona out of her employment.

  • Mrs Piccoli told Ms Sagona that the business was in trouble and requested that she work whatever hours it took in order to meet new (and unrealistic) sales targets. It was made clear to Ms Sagona that her remuneration and her employment were in jeopardy if she did not meet those targets.
  • Mr Piccoli demanded that Ms Sagona take long service leave from Christmas 2012 because he said it was not a “professional look” or a “good look” to have a heavily pregnant woman working in his business. Concerns were raised about Ms Sagona’s wellbeing and her health and safety.  However, Mr Piccoli was particularly concerned that customers would think that he was forcing her to work “under sufferance”, notwithstanding that it was Ms Sagona’s choice to be at work and there was no medical evidence to suggest that she was unfit to perform her duties safely.
  • Mr and Mrs Piccoli refused to consider Ms Sagona’s proposal that she return to work part-time.  It was suggested that Ms Sagona must return to work full-time or not at all. Mr Piccoli said  that he could offer “no guarantee” that Ms Sagona’s job would be there when she returned.
  • The Piccolis had “ganged up” on Ms Sagona in one meeting, and Mrs Piccoli had spoken to her in an abusive tone.

The award of over $200,000 included compensation as well as penalties, which were at the upper end of the scale (approximately 70% of the maximum available). In reaching this conclusion, Judge Whelan said “Regardless of the size of the business or its financial position, an employer cannot be absolved of its legal responsibilities to comply with the law… Further, the Respondents cannot hope to have their conduct, in effect, exonerated merely because they claim to be impecunious.”  In other words, the size and resources of an employer are no defence to unlawful discrimination or adverse action under the FW Act. Small businesses, too, must comply.

Mr and Mrs Sagona were found personally liable, in addition to their company.

Pregnancy discrimination still rife, says AHRC Research

Despite many employers doing the  right thing, research released by the AHRC suggests that one in two women still experiences pregnancy or family responsibilities discrimination at work.

Of those surveyed who reported discrimination, the most common  issue was discrimination surrounding work and family responsibilities (34%); followed by requests to take parental leave (32%); and discrimination during pregnancy itself (27%).  A minority reported discrimination in relation to breast-feeding or expressing milk (8%).

The AHRC’s full report on the  Supporting Working Parents: Pregnancy and Return to Work National Review is due to be launched on 25 July 2014 (not yet released at time of print).

Employers should ensure that they are taking all reasonable steps to comply with their obligations with regard to pregnancy and parental responsibilities. Some of those key obligations are summarised below.

Click here to view table