How will the proposed Respect at Work legislation impact Australian businesses?

With the #MeToo movement sparking a global discussion on sexual harassment and gender inequality, a key question became whether Australia’s legal and regulatory systems were fit for purpose, particularly in preventing and responding to workplace sexual harassment.

Subsequently, in 2018, the Federal Government funded the Australian Human Rights Commission (AHRC) to undertake the National Inquiry into Sexual Harassment in Australian Workplaces. In March 2020 the AHRC publicly released its Respect@Work Report (Report), which made 55 recommendations aimed at preventing and responding to sexual harassment in the workplace.

In response, the Sex Discrimination and Fair Work (Respect at Work) Amendment Bill 2021 (Cth) (Bill) was introduced into Parliament by the Federal Government. Its aim was to clarify, streamline and strengthen the existing frameworks for preventing and responding to sexual harassment in the workplace. The Bill explicitly adopted six of the Report’s 55 recommendations and amended three key existing pieces of Commonwealth legislation:

  • Fair Work Act 2009 (Cth) (FWA);
  • Sex Discrimination Act 1984 (Cth) (SDA); and
  • Australian Human Rights Commission Act 1986 (Cth) (AHRCA).

The Sex Discrimination and Fair Work (Respect at Work) Amendment Act 2021 (Cth) (Respect@Work Act) came into force on 11 September 2021.

Amendments to FWA

Valid reason for dismissal

Under the FWA sexual harassment has been capable of being a valid reason for dismissal for the purposes of an unfair dismissal application. The Respect@Work Act takes this further and has added a note to the FWA which clarifies that workplace sexual harassment can amount to a valid reason for dismissal. This will assist employers to base a fair dismissal on workplace sexual harassment.

The addition of sexual harassment as a possible valid reason for dismissal followed an amendment to the Fair Work Regulations 2009 (Cth) in July 2021 which added sexual harassment to the definition of serious misconduct in the FWA. This could mean that if an employee’s conduct constitutes sexual harassment, they may not have an entitlement to a notice period if dismissed on that basis.

Stop sexual harassment orders

A worker who is sexually harassed at work can apply to the Fair Work Commission (Commission) for an order to prevent them from being sexually harassed at work, if the Commission is satisfied harassment has occurred and there is a risk the worker will continue to be sexually harassed at work.

Case law has held ‘at work’ includes both the performance of work, and when the worker is engaged in an activity authorised or permitted by their employer. Note there is no requirement, unlike under the anti-bullying regime, for the behaviour to have occurred repeatedly. This is intended to provide a quick, low-cost mechanism to deal with complaints.

These amendments extend the Commission’s existing ‘stop bullying order’ regime. The Commission must deal with an application within 14 days and can make any order it considers appropriate (other than requiring a compensation payment) to prevent the worker from being sexually harassed at work. In making such an order, the Commission is required to have regard to any:

  • outcomes (final or interim) arising out of an investigation into the matter;
  • procedure available to the worker to resolve grievances or disputes;
  • outcomes (final or interim) arising out of such a procedure; and
  • matters the Commission considers relevant.

To defend ‘stop orders’ it will be important for employers to have strong policies and procedures, adequate training of employees, and effective complaint and dispute-resolution mechanisms.

Amendments to SDA

New object for the SDA

A new object has been inserted into the SDA, ‘to achieve, so far as practicable, equality of opportunity between men and women.’ This provides guidance to employees, employers and the Courts on its underlying purpose and supports interpretation of the rest of the SDA’s provisions.

Harassment on the ground of sex

Importantly, ‘harassment on the ground of sex’ is now defined and explicitly prohibited as a form of unlawful conduct. This provides greater protection from discriminatory conduct that did not fit clearly into the existing definitions of sex discrimination and sexual harassment under the SDA. The Bill’s Explanatory Memorandum suggested examples, depending on the circumstances, may include:

  • asking intrusive personal questions based on a person’s sex;
  • making inappropriate comments and jokes to a person based on their sex;
  • displaying images or materials that are sexist, misogynistic or misandrist;
  • making sexist, misogynistic or misandrist remarks about a specific person; and
  • requesting a person to engage in degrading conduct based on their sex.

The Respect@Work Act makes clear that sexual harassment and harassment on the ground of sex that occurs ‘in connection with’ the person being an employer or employee is made unlawful. As such, there is no requirement for work to be being performed when the harassment occurs as long as there is a connection. For example, liability may be found where the conduct takes place at work related events and functions outside of the physical workplace.

Expanding the scope of the SDA

The amendments expand the scope of the SDA (in relation to sexual harassment and harassment on the ground of sex) to Members of Parliament, State and Territory judges and their staff and consultants and State and Territory public servants. This closes a significant loophole which has been the subject of significant media attention and debate.

Further, in respect of sexual harassment and harassment on the ground of sex, ‘any worker’ (paid and unpaid) in ‘a business or undertaking’ is now protected. The scope of protection is extended from employees, commission agents or contract workers to other workers, including interns, apprentices, or volunteers and self-employed individuals.

Furthermore, liability is extended beyond an ‘employer’ to ‘a person conducting a business or undertaking’. Businesses in general may now need to take steps to manage the conduct of all workers in a workplace, regardless of the capacity in which they work.

Victimisation can give rise to civil proceedings

A person who is threatened or subjected to detriment can now make a civil action for unlawful discrimination under the SDA.

Accessorial liability extended

Under the SDA the conduct of a person who ‘causes, instructs, induces, aids or permits’ another person to do an unlawful act of discrimination is taken to have been done by that person as well. This means they can be held personally liable for such behaviour. This liability is known as accessorial liability.

The amendments under the Respect@Work Act extend accessorial liability to harassment on the ground of sex. This means executives and managers who fail to take appropriate steps to deal with harassment in the workplace on the ground of sex may be held liable as an accessory to this behaviour, if they knew about it occurring, or that there was a risk of it occurring, and did not take appropriate steps to address it, or, worse still, encouraged the conduct.

Amendments to AHRCA

Discretion to terminate complaint extended

While there is no specific timeframe under the SDA to lodge a complaint with the AHRC, the President of the AHRC holds a discretion to terminate a complaint lodged more than six months after the alleged discrimination took place. Under the Respect@Work Act if the complaint relates to the SDA, AHRC will now hold a discretion to terminate a complaint lodged more than 24 months after the alleged discrimination took place.

This extended period recognises that people who have experienced sexual harassment or otherwise are often not in a position to speak up immediately following the event, and this presented a considerable barrier to their access to justice.

Practical considerations for businesses

The Respect@Work Act extends the scope of potential liability, and the range of remedies, for sexual harassment, and places extra obligations on businesses to prevent harassment in the workplace.

To reduce the risk of liability businesses should consider undertaking a gap analysis of their policies and procedures, Codes of Conduct, training programs, and complaint and dispute resolution processes. These should be revised to see if they remain fit for purpose in light of the changes. In most cases changes will need to occur, specifically at least in dealing with the new main changes:

  • harassment on the ground of sex will need to be included; and
  • training will need to be updated for the amendments.

The Government is continuing to review the Recommendations of the Report and it is expected that further legislative changes will be made.

Read other items in the Australian Employment Brief - March 2022