One of the frustrations employers experience in relation to unlawful discrimination involves the issue of vicarious liability for the unauthorised acts of employees. Discrimination legislation generally makes the employer liable for employees' acts unless the employer can prove they had taken all steps reasonably possible to avoid or prevent the discriminatory actions taking place.
Rarely have arguments by employers that they have indeed taken all reasonable steps been graced with success. The reasons for this are clear. As with taking all reasonably practical action to avoid an OH&S risk, it is fairly easy to suggest other steps that could have been taken – which may have prevented the incident from occurring – but were not.
However, in a group of recent cases, employers indeed have been found to have done everything reasonably possible. Briefly summarised, the thrust of these decisions is that an employer may well be able to avoid liability if they:
- have adequate policies and procedures in place, which have been the subject of training, so that the alleged offender should have been in no doubt of the employer's disapproval of discriminatory conduct
- take prompt action upon a complaint being made.
By example, consider these cases:
- A male employee handed a female employee a folded note at a work meeting. It contained graphic sexual material. She complained. The employer acted promptly to investigate the complaint and discipline the offender. The employer had a policy, but it also did much more: employees had to recommit to the code of conduct, and attend refresher training on a regular basis. While the policy itself would not have been sufficient, the additional steps meant that the employer could not have done anything else to avoid what occurred. The offender had to pay $10,000, however, the employer was not liable.
- A male employee publicly humiliated a male colleague by simulating sex with him. When the victim complained, the employer re-located the offender and, after due process, sacked him. The victim sued both offender and employer. The offender was ordered to pay $8,000 but the employer was found not liable. The employer had a policy, had provided handbooks to employees and had provided training. That, combined with prompt action, effectively meant that there was not much else it could have done.
Note that in neither case had the employer been aware of the misconduct. If you become aware of misconduct and do nothing, it will appear to be tolerance or condonation of the behaviour and the employer will be liable.
The lessons? Have good policies in place – do training and refresh it periodically – act on reported misconduct as soon as possible.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
