The full bench of the Federal Court in Richardson v Oracle
Corporation Australia1 (Richardson) has cited
changing community standards as a basis for significantly
increasing awards for general damages (ie damages for non-economic
loss, such as loss of enjoyment of life) in discrimination matters.
In Richardson, the Court increased an award of general
damages from AUD18,000 to AUD100,000 indicating that vicarious
liability for workplace discrimination will be significantly more
expensive for employers going forward.
The Facts and the Decision at First Instance
Ms. Richardson, a technical manager at Oracle Corporation, was
sexually harassed on 11 separate occasions by her colleague, Mr
Tucker. These instances generally involved Mr. Tucker making
comments of a smutty or offensive nature, "I'll be
thinking about [your legs] wrapped around me all day", and
inviting Ms. Richardson to join him for private liaisons, such as
dinner or a weekend in the cabin of Mr. Tucker's boat.
The trial judge, Justice Buchanan, did not criticise Oracle
Corporation for the way in which it responded once it became aware
of the harassment. However, Justice Buchanan found Oracle
Corporation vicariously liable for Mr. Tucker's actions because
its policies did not refer to the applicable laws or state clearly
that sexual harassment was unlawful behaviour for which Oracle
could be vicariously liable. Following this finding, Justice
Buchanan awarded Ms. Richardson AUD18,000 in general damages.
Ms. Richardson appealed the decision.
The Decision on Appeal
The Full Federal Court acknowledged that the award of AUD18,000
was consistent with general damages awards in numerous other
discrimination cases where there had been no significant
psychological trauma or limitations on work. The Court also
acknowledged that general damages in the region of AUD100,000 had
previously been confined to limited cases in which there was expert
evidence of significant psychological trauma and suffering.
However, the Court went on to observe that:
community standards now accord a higher value to compensation
for pain and suffering and loss of enjoyment of life than
academic commentary suggests that a 'conservative
approach' to assessing discrimination damages impedes the
'deep social reform' intended by anti-discrimination
there is a need for awards for general damages in
discrimination matters to be consistent with the higher general
damages awards made in comparable personal injury and workplace
After concluding that the damages awarded in the prevailing
discrimination cases did "not reflect the shift in the
community's estimation of the value to be placed on these
matters", the Court found that the original award of AUD18,000
was "manifestly inadequate" and substituted it with an
award of AUD100,000.
An Expensive Change in the Law
A general damages award of AUD100,000 to a victim whose
harassment was not extreme and whose ability to work was not
impacted has the potential to cause a significant shift in
discrimination litigation. It also leaves open the question of what
damages might be awarded to a victim who suffers significant
psychological trauma following discrimination in the workplace.
Oracle Corporation has until 5 August 2014 to appeal the
1Richardson v Oracle Corporation
Australia  FCAFC 82
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guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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