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Australian Court raises the bar on Compensation Award for Sexual Harassment and Discrimination

Authors: Greg Robertson and Liz Baradan

On 9 August 2021, the Industrial Court of Queensland in Australia handed down its judgment in Golding v Sippel and The Laundry Chute Pty Ltd [2021] ICQ 14 awarding combined general and aggravated damages of $130,000 to an employee, Ms Goulding, who had been subjected to sexual harassment and sex discrimination in the workplace. Ms Golding was also awarded an additional sum of $28,702.60 for economic loss, bringing her total award of compensation to almost $160,000, which is a record-breaking amount of damages in the State of Queensland. This decision has significantly increased the amount of damages sexual harassment and discrimination victims can expect to be awarded.

The Sexual Harassment and Sex Discrimination

Ms Golding was employed at The Laundry Chute Pty Ltd from June 2017 to August 2018 in Queensland, Australia. She was subjected to sexual harassment and sex discrimination for the entire 14-month period of her employment. The sexual harassment involved Mr Sippel demanding sex in return for work, inappropriately touching Ms Golding, forcing her to touch his genitals, requesting massages and sending explicit text messages of a sexual nature. Ms Golding (a domestic violence survivor and single mother who received no support from the father) relied on this insecure low paid work to provide for her and her four children, and so had put up with the unwanted conduct to avoid the risk of not being offered future work, until finally the text messages caused her to fear for her safety and she reported the conduct to the Police. Not only was the conduct found to be sexual harassment, but Ms Golding also was found to have experienced direct discrimination as the sexual harassment was perpetrated against her on the basis of her sex and that a male employee in the same circumstances would not have been subject to that treatment by the same employer.

Justice Davis described the offending conduct as “extremely serious” as it tormented Ms Golding who had no other choice but to tolerate “lewd and disgusting behaviour” due to her vulnerability and poor financial position. The sexual harassment and sex discrimination ultimately resulted in Ms Golding being diagnosed with an anxiety disorder which caused her to be unable to work. Justice Davis stated, “On every day she appeared for work, she knew the prospect was that she would be humiliated and demeaned sexually by him.”

Award for General and Aggravated Damages

On 9 March 2021, the Queensland Industrial Relations Commission (“QIRC”) at first instance had awarded Ms Golding a general damages sum of $30,000 and aggravated damages sum of $5,000. Ms Golding appealed that decision to the Industrial Court of Queensland (the “Court”) on the basis that the compensation awarded by the QIRC was inadequate. The Court held that the compensation awarded by the QIRC was manifestly inadequate and constituted an appellable error. In its decision, the Court considered awards in other cases, the factual findings of the QIRC, the medical evidence and other factors which could be categorised within “aggravated damages”. It increased the amount awarded to $130,000.

Award for Economic Loss

The QIRC had previously confined the calculation of Ms Golding’s economic loss to the period during which she would have been employed by the employer but for the sexual harassment and sex discrimination. It determined that but for the offending conduct Ms Golding would have been employed for a further period of one year, as the employer’s business had closed around 13 months after the termination. The QIRC awarded Ms Golding $15,960 for the economic loss that she suffered during that one-year period.

However, the Court held that the previous decision of the QIRC was incorrect and awarded Ms Golding $28,702.60 (applying the usual contingency discount) for the economic loss that she suffered for the period that she was unfit for work due to the sexual harassment and sex discrimination.  The Court determined that the correct approach to calculating economic loss in the circumstances was to calculate Ms Golding’s loss during the entire period from her termination to the time of the hearing. The court stated: “The contravention made Ms Golding unfit for work up to the time of the hearing and therefore, she should be compensated for that loss irrespective of the fact that The Laundry Chute may not have continued her employment even if the offending conduct had not occurred”.  

Key Action Points for Human Resources and In-house Counsel 

  • This decision is an important reminder that courts are increasing damages awards for sexual harassment and discrimination victims and this change reflects prevailing community standards.
  • Employers should be aware of their obligation to prevent sexual harassment within the workplace as findings of sexual harassment or sex discrimination against employers will be taken seriously by the Courts.
  • Awards of damages, which more accurately reflect the impact that sexual harassment and discrimination has on victims, are expected to encourage and empower such victims to come forward.