Richardson v Oracle Corporation Australia Pty
Ltd  FCAFC 82
The Full Court of the Federal Court of Australia earlier this
week handed down a landmark decision concerning the assessment of
general damages for victims of sexual harassment who suffer
On appeal the Full Court ruled that the general damages awarded
at trial to a former employee of a multinational corporation who
suffered a psychological injury because of sexual harassment by a
work colleague were "manifestly inadequate". Instead, the
Full Court ordered the former employer to pay compensation of
$100,000 to the employee for general damages in lieu of the trial
award of $18,000.
Psychological injury arising from established complaints of
sexual harassment (and probably also other types of discrimination
in the human rights jurisdiction) will now result in an award of
general damages – compensation for pain, suffering and loss
of enjoyment of life – determined in accordance with
prevailing community standards. These will include comparable
awards of general damages in personal injury and workplace bullying
decisions, rather than the relatively modest former precedent range
of $12,000 to $20,000 until now endorsed by the Australian Human
In this Alert, Senior Associate Damon King, Solicitor Claire
Tuffield and Employee Relations Advisor Adele Garnett, summarise
this important decision and the likely flow-on effects for
Trial decision – findings of fact
At first instance the trial judge found that the plaintiff, Ms
Richardson, had been sexually harassed over a period of
approximately six months whilst working for Oracle. In particular,
Ms Richardson was subjected to sexual harassment on 11 separate
occasions by the perpetrator, including on some occasions in the
presence of co-workers and external client representatives.
The harassment consisted of unwelcome and humiliating verbal
advances, comments and slurs of a sexual nature, for example:
I love your legs in that skirt. I'm going to be
thinking about them wrapped around me all day long;
I love it when you're mean to me. It just makes me
think how hot you would be in bed.
The trial judge also found that, as a consequence of the sexual
harassment, Ms Richardson developed an adjustment disorder with
features of anxiety and depression, from which it had taken
approximately 12 months for her to recover once the harassment
Oracle was held to be liable for the unlawful conduct of the
perpetrator - also its employee - and ordered to pay compensation
of $18,000 for general damages to Ms Richardson.
Appeal decision – what is the benchmark in relation to
On appeal against the original award, Oracle unsuccessfully
argued that monetary awards for general damages arising from sexual
harassment are ordinarily within the range between $12,000 and
The Full Court relevantly observed:
"...that continued adherence
in sex discrimination cases, including sexual harassment cases, to
a 'range' of damages awards that has not absorbed the
increases evident in awards in other fields of litigation has
resulted in an award in Ms Richardson's case that, judged by
prevailing community standards, is disproportionately low having
regard to the loss and damage she suffered".
Ms Richardson's appeal was upheld by the Full Court which
increased her general damages from $18,000 to $100,000.
What does this case mean for employers?
This landmark decision has important significance in relation to
the enforcement of federal, State and Territory human rights laws
and the general protections provisions prohibiting workplace
discrimination in Part 3 –1 of the Fair Work Act
Employers may now find that victims of alleged human rights
abuses (and their lawyers) will be less inclined to settle
complaints for relatively modest sums.
More than ever, it is of upmost importance that all employers,
small and large alike, have in place systems and processes designed
to limit, if not eliminate, the risk of unlawful discrimination
(including sexual harassment) in their workplaces. These would
ordinarily include codes of conduct, workplace policies, training
materials and processes compliant with applicable legislation to
ensure that staff are properly trained and regularly reminded about
their personal responsibilities and obligations.
The significant costs of responding to human rights complaints
and, if necessary, defending litigation to a final court or
tribunal hearing, together with exposure to increased awards for
general damages and also compensation for economic loss, will
ordinarily far outweigh the expense of taking appropriate steps to
provide a safe place of work. In addition, a safe working
environment will facilitate the long term retention of good
Long experience representing many of Australia's leading employers has taught us that in employment litigation the identity of an employee's representative is a major factor in how employee litigation runs.
Australian employees receive certain entitlements (such as annual leave and superannuation) where contractors do not.
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