The Victorian Civil and Administrative Tribunal (Tribunal) found an employer to be vicariously liable for the unlawful sexual harassment of an employee. The employer was ordered to pay $150,000.

The case of Oliver v Bassari (Human Rights) [2022] VCAT 329 is a reminder to employers that the mere existence of a sexual harassment policy is insufficient to discharge an employer’s positive duty to take reasonable and proportionate measures to eliminate sexual harassment.

Background

Devorah Oliver (the Applicant) commenced employment as a Beauty Therapist with a male grooming business, Hebeich Pty Ltd t/a “Man Oh Man” (the Employer) in January 2018.

The Applicant claimed that she was subjected to sexual harassment by a co-worker, Federico Catalfamo (Mr Catalfamo), following the commencement of her employment. Such conduct included Mr Catalfamo:

engaging in unwelcome physical touching such as slapping the Applicant on her bottom and putting his legs between the Applicant’s legs;
making suggestive gestures, comments, jokes and sexual noises;
asking the Applicant questions about her sex life, if she wanted to see his penis and if he could perform sexual acts on her; and
requesting sex with the Applicant whilst at work.

The Applicant claimed to have made two complaints to the manager about Mr Catalfamo’s inappropriate conduct towards her – the first in April / May 2018 and the second in July / August 2018.

The Applicant resigned after two incidents that occurred on 30 November 2018. Specifically, Mr Catalfamo attempted to put his fingers in the Applicant’s mouth when her hair was being washed in a basin and shoved his face between her breasts. Mr Catalfamo separately faced criminal charges for these incidents.

The Applicant applied to the Tribunal pursuant to the Equal Opportunity Act 2010 (Vic) (EO Act) on the basis that she was sexually harassed by Mr Catalfamo. Both the Employer and the manager were named as Respondents to the application. Relevantly, the Applicant alleged that:

the Employer was vicariously liable for the conduct of Mr Catalfamo;
the manager assisted, authorised and / or encouraged the sexual harassment; and
the Employer breached its positive duty to take reasonable and proportionate measures to eliminate sexual harassment as far as possible.

Finding

The Tribunal found that the Applicant was sexually harassed by Mr Catalfamo, in contravention of section 93 of the EO Act based on the Applicant’s evidence. The Employer did not dispute the allegations made against Mr Catalfamo.

The Tribunal further found that the manager had failed to prove, on the balance of probabilities, that she took reasonable precautions to prevent Mr Catalfamo from sexually harassing an employee.

The manager claimed that:

the Employee Handbook was both emailed to new employees and available electronically;
she had emailed the Employee Handbook to Mr Catalfamo in December 2017 before he commenced work;
the contents of the Employee Handbook were discussed at more than one staff meeting held in 2018 at which Mr Catalfamo was present; and
the Employee Handbook contained policies relating to standards of workplace behaviour including a specific section on sexual harassment, anti-discrimination and equal opportunity.

The Tribunal rejected the manager’s evidence that the Employee Handbook was emailed to Mr Catalfamo in December 2017 given the original issue date of the Employee Handbook was 1 January 2018. Further, there was no email evidence in support of the claim that Mr Catalfamo was emailed the Employee Handbook. The Tribunal also noted there was no evidence of any specific training given to the employees regarding the Employee Handbook – which was almost 100 pages in length. Further, when asked during cross -examination if she was familiar with the Employee Handbook, the manager responded with, “I’ve flicked through it.” The Tribunal concluded that any staff discussion regarding the Employee Handbook could only have been rudimentary.

The Tribunal further found that the only precautions the Employer took to prevent sexual harassment (before the Applicant made her first complaint) were:

to make the Employee Handbook available electronically; and
discussing the Employee Handbook in a basic manner during one of the staff meetings in 2018.

The Tribunal said that these precautions fell short of what it considered to be reasonable precautions.

Importantly, the Tribunal said that the following would have amounted to the Employer taking reasonable precautions to prevent sexual harassment in the workplace:

ensuring that Mr Catalfamo and other employees received, read and had a sound understanding of sexual harassment and the related policies in the Employee Handbook by having employees take a short questionnaire or conducting regular (but not necessarily frequent) refresher training meetings on the Employee Handbook; and
monitoring the workplace to ensure employee compliance with its policies in the Employee Handbook.

The Applicant claimed that the Respondents assisted the unlawful conduct of Mr Catalfamo by continuing to roster the Applicant and Mr Catalfamo to work together.

The Tribunal was not satisfied that the Employer had authorised, encouraged or assisted the sexual harassment. Relevantly, the Tribunal said that continuing to roster the Applicant and Mr Catalfamo to work together did not amount to the manager taking “some positive action” or taking a “direct or conscious action” to authorise, encourage or assist the sexual harassment.

The Tribunal found that the Employer and the manager:

were aware of the sexual harassment allegation from at least the date of the first complaint made by the Applicant in or around April / May 2018; and
became aware, or at least accepted at some unknown point in time during the Applicant’s employment with the Employer, that the sexual harassment was occurring.

The manager said that she did not discipline Mr Catalfamo immediately following the incidents on 30 November 2018 because the matter was being investigated by Victoria Police and that she was overseas at the time. The manager said that she gave Mr Catalfamo a first written warning on or around 30 April 2019 before the outcome of the criminal proceedings were known.

The Tribunal noted, amongst other things, that the Respondents failed to:

conduct any sexual harassment training for Mr Catalfamo and other employees;
conduct an investigation into the sexual harassment allegations;
examine any CCTV footage that recorded the complaint;
provide any evidence that Mr Catalfamo ever read the Employee Handbook;
take any disciplinary action against Mr Catafamo until 30 April 2019; and
refer Mr Catalfamo to the relevant policies in the Employee Handbook.

The Tribunal found that as the Employer failed to prove that it took reasonable precautions to prevent Mr Catalfamo from contravening the EO Act it was vicariously liable for the unlawful conduct engaged by Mr Catalfamo. The Employer was ordered to pay the Applicant $150,000 in general damages.

The Applicant applied for costs against both the Employer and the manager. However, the application for costs against the Employer was stayed as the Employer went into external administration. Further, the Applicant was unsuccessful in obtaining a costs order against the manager. The manager’s application for costs against the Applicant was also dismissed.

Key Lessons

It goes without saying –complaints need to be treated seriously and quickly.
Simply having a policy on sexual harassment without ensuring that employees have a sound understanding of their behavioural expectations will not automatically discharge an employer’s positive duty to take reasonable and proportionate measures to eliminate sexual harassment as far as possible.
Employers should conduct regular refresher training for employees to ensure employees have a sound understanding of sexual harassment and related policies. Details such as the name of the person conducting the training, the date of the training and those who attended the training should be recorded as evidence of the training attendance.
It is also critical for employers to monitor the workplace to ensure compliance with its sexual harassment policies for potential breaches.

For more information please contact:

Jasmine O'Brien
Principal
M +61 401 926 108 | T +61 3 9611 0149
E: jobrien@sladen.com.au

Geeta Vanugopal
Associate
T +61 3 9611 0135
E: gvanugopal@sladen.com.au