Australia: Workplace violence and red collar crime: Is it more threatening than you think?

Workplace violence is a significant and ongoing risk that employers should be alive to because it affects employee health, safety and wellbeing, which in turn impacts on productivity, absenteeism, sickness and replacement costs, to name a few.  In respect of the individual, it often causes physical or psychological injury and can even lead to death. In respect of the employer and industry more broadly, it can play out as an expensive scenario in terms of resources, money, time, good will, reputation and increased workers’ compensation and insurance premiums. Unfortunately however, the extent and prevalence of workplace violence in Australia is somewhat unknown. This is partly due to definitional ambiguities, the absence of national data being collected in this area and under-reporting.

‘Red collar crime’ is a subset of workplace violence and refers to behaviour that straddles between violent crimes and white collar crimes linked to work. Where there is threat of detection, red-collar criminals commit acts of violence to conceal their criminal behaviour. There is not a great deal of literature on red collar crime and often statistics do not properly show the motive behind these violent crimes, being the desire to conceal fraud in the workplace, but they are simply captured in crime statistics. This type of violence has also been called ‘fraud-detection homicide’ and can result from desperation and perceived pressure, including the prospect of imprisonment for the fraud, financial position, embarrassment, family isolation and loss of status and respect.

A recent US survey from the Bureau of Labor Statistics showed that homicide ranked as the third highest cause of workplace death, after ‘falls’ and ‘roadway collisions with other vehicles’. Further, although physically violent attacks (particularly in the US) often receive more media attention, a greater number of people generally report being exposed to violence of a psychological nature, such as bullying. Whilst the environment in the US is different to Australia (e.g. gun laws), red collar crime and workplace violence certainly does exist in Australia. The most recent statistics on workplace bullying and violence reported by Safe Work Australia in 2017 showed:

• 37% of workers reported being sworn at or yelled at in the workplace;
• 22% of workers reported being physically assaulted or threatened by patients or clients;
• 39% of mental disorder claims were caused by harassment, bullying or exposure to violence; and
• 15% of mental stress claims resulted from exposure to occupation violence (and this percentage increases for workers aged below 27 years).

Therefore, despite being an important consideration for employers because of its prevalence and detrimental impacts, workplace violence (and potentially red collar crime) does not often attract the same level of focus and attention that it should.

There is also an interesting link that can be drawn between workplace violence and the prevalence of sexual harassment in the workplace. The Australian Human Rights Commission (AHRC) recently reported that sexual harassment in the workplace has doubled in the last six years. Sex Discrimination Commissioner, Kate Jenkins, said the alarming figures in the AHRC’s recent survey confirm sexual harassment is "widespread and pervasive".

In the context of social change, we have witnessed the breadth of the #metoo movement and the detrimental impact on organisations that have not responded appropriately in the public gaze. Although violence in the workplace has existed for a long time, it is possible that a similar revelation of sorts could occur in respect of workplace violence. However, due to the absence of national data being collected in this area, under-reporting and definitional ambiguities we cannot properly know its prevalence. The same could potentially be said about red collar crime – there are still considerable unknowns in this area. As such, employers cannot be complacent about workplace culture and practices, even if certain behaviour has been the norm for a considerable period.

Is a company policy on workplace violence sufficient?

Much of the advisory material and studies on workplace violence that inform many company policies are outdated and focus on occupations with traditionally higher rates of workplace violence, such as health care and services workers, including police, nurses, taxi drivers, bank tellers and service station attendants. However, in light of the changing and dynamic nature of the workplace, your company policies and procedures should be regularly reviewed and implemented with staff training. With employees working in a variety of ways, spaces and places, due to increasingly flexible and mobile workplaces, employers need to consider their employees’ potentially increased exposure to workplace violence.

Historically workplace violence data did not capture violence from (current or former) relationship partners of employees. However, domestic violence entering the workplace is becoming increasingly common, for example, where an employee who works from home is subject to domestic violence or where an employee in the physical workplace receives abusive calls, texts, emails or visits from a violent partner. Unfortunately, there is a gap in practical tools available to companies to manage potential threats of workplace violence, particularly where that threat is less visible and apparent to staff.

The new family and domestic violence leave entitlement in modern awards, which commenced 1 August 2018, however, goes some way towards addressing the intersection between domestic violence and the workplace. There is also a Bill before the Federal Government which would introduce the same entitlement in the National Employment Standards in the Fair Work Act. In this regard, employers should update their policies to reflect this entitlement and be mindful that whether an enterprise agreement contains an entitlement for such leave will be considered by the Fair Work Commission in its BOOT assessment for the purposes of its approval.

What are the business risks?

Employers should be across the risks, both legal and commercial, that may arise where there is an incidence of workplace violence or red collar crime. These may include:

• personal injury claims for physical and psychiatric impact, either under workers’ compensation (in the case of employees) or at common law (by all others);
• breach of health and safety laws by the company and its officers (including the heightened risk profile in Queensland and ACT where there is an industrial manslaughter offence) and regulator notification requirements;
• discrimination claims by workers exposed to workplace violence (earlier this month, the Victorian Civil and Administrative Tribunal found that that an employee was discriminated against on the basis of her sex when a manager told the employee that she was being “oversensitive” after she complained about a co-worker saying things of a violent nature to her or in her presence);
• commercial contractual service delivery;
• staff engagement and productivity; and
• reputational damage, including to social licence, share price, ‘employer of choice’ status and media and public backlash.

Considerations and takeaways for employers

Employers need to consider where the sources of risks may arise in their workplace, for example:

• a disgruntled (former) employee acting as a lone wolf;
• activists interrupting operations;
• drug and alcohol fuelled behaviour; or
• bullying escalating to violence (from either the perpetrator or victim).

One way to assess the risk, proposed by the President of the Canadian Initiative on Workplace Violence, Glenn French, is by considering the ‘Perceived Personal Control’ of your employees, being, whether each individual believes they have control of their surrounding circumstances, including from a work, social, health and interpersonal perspective.

Employers also need to consider the physical location of the risk and whether that poses any practical challenges for managing the risks. For example, there may be additional considerations for employers with rural or geographically isolated sites. Such considerations will necessarily be different from, for instance, the threats of cyber-crime and digital violence.

Employer best practice involves regularly identifying hazards, assessing and controlling risks and reviewing and improving the effectiveness of control measures. In this regard, depending on the nature, size and risk factors in your workplace, the following should be addressed: reporting procedures, workplace training, response and crisis management, investigations and ongoing monitoring and prevention.

There is no room for employer complacency when it comes to workplace violence, or you may find that it is more than just the perpetrator getting hot under the collar.

This article was prepared by Kirsty Faichen, Partner, Sarah Beer, Senior Associate and Emma Szczotko, Solicitor 

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