Australia: Respect at Work: Further change on the horizon for sexual harassment laws in Australia

On 27 September 2022, the Anti-Discrimination and Human Rights Legislation Amendment (Respect at Work) Bill 2022 (Bill) was introduced into the House of Representatives.  The much-anticipated Bill proposes to implement seven of the remaining legislative recommendations from the 2020 Jenkins’ Respect@Work Report.

The key proposed amendments in the Bill are as follows:

• Positive duty: The introduction of a positive duty in the Sex Discrimination Act 1984 (Cth) (SDA) on employers and PCBUs (duty holders) to take reasonable and proportionate measures to eliminate, as far as possible, unlawful sex discrimination, sexual harassment, sex-based harassment, work environments that are hostile on the ground of sex, and victimisation in relation to these matters;

• New prohibition on subjecting others to hostile workplace environments on the grounds of sex: The creation of a new prohibition against conduct that subjects another person to a hostile workplace environment on the ground of sex, and adding a new object of the SDA as eliminating, so far as is possible, discrimination involving workplace environments that are hostile on the grounds of sex; and
• Class actions and no costs jurisdiction: Amendments that allow for representative bodies (such as unions) to make representative applications in the Federal Courts (also known as ‘class actions’) on behalf of one or more individuals who have experienced unlawful discrimination, and including cost protection provisions in the Australian Human Rights Commission Act 1986 (Cth) (AHRC Act) so that each party bears its own costs in discrimination court proceedings (other than in very limited circumstances).

Some of these amendments, such as the introduction of the positive duty, are a long-time coming. Since the Respect@Work report was released in March 2020, we have seen best practice employers focussing on continuously improving their systems and processes and challenging the status quo, to minimise the risk that sexual harassment and other unlawful discrimination will arise in their workplaces. Increasingly, we are seeing employers not just address this as a ‘compliance’ or legal issue and are seeing these steps as critically important to providing a safe workplace with a positive and productive culture to employees and others who work in their workplaces.  Such actions are also increasingly being seen as crucial to discharging an employer’s ESG obligations.

On the other hand, the proposed introduction of a specific mechanism for class actions for unlawful discrimination in the Federal courts does give rise to the risk that there may become increasing litigation in this space. However, it is difficult to see how such proceedings will be practical or effective in workplace discrimination matters which are typically highly individualised.  The amendment may also have a negative impact on the trend amongst employers towards transparency in relation sexual harassment and unlawful discrimination, given the heightened litigation risk which that transparency may bring.  This would be unfortunate given the considerable progress which has been made towards accountability and transparency in recent years.

Whilst many employers have long been preparing for these changes, the release of the Bill is a clear indication that the regulatory and legislative landscape for addressing sexual harassment and other unlawful discrimination is set to change. For those employers who have not yet examined their existing systems and governance mechanisms for these issues, the Bill serves as a call to action to start this process, sooner rather than later.

Other key proposed amendments

The other key proposed amendments addressed in the Bill include the following:

• Conferring functions on the AHRC to monitor, assess and enforce compliance with the positive duty in the SDA;
• Inserting new provisions to provide the AHRC with a broad inquiry function to inquire into systemic unlawful discrimination or suspected systemic unlawful discrimination if requested to do so by the Minister, or of the AHRC’s own volition;
• Extending the timeframe for making complaints of age, disability and race discrimination to the AHRC by only allowing the President of the AHRC Act to terminate the complaints on the grounds of time after 24 months (rather than 6 months), aligning with the timeframe for complaints made under the SDA;
• Amending the Workplace Gender Equality Act 2012 (Cth) to require Commonwealth Public Sector reporting to the Workplace Gender Equality Agency (in line with the private sector);
• Clarifying that victimising conduct can form the basis of a civil action for unlawful discrimination (in addition to a criminal complaint) under the Age Discrimination Act 2004 (Cth) (AD Act), Disability Discrimination Act 1992 (Cth) (DD Act) and the Racial Discrimination Act 1975 (Cth) (RD Act);
• Lowering the threshold for an applicant to establish ‘harassment on the ground of sex’ in the SDA by removing the requirement for the conduct to be ‘seriously’ demeaning, (requiring the conduct to ‘demeaning’ only); and
• Amending the objects of the SDA to provide for ‘substantive equality’ between men and women rather than ‘equality of opportunity’.

Whilst the Bill was introduced by the Federal Attorney-General, Hon Mark Dreyfus KC, MP, the Minister for Employment and Workplace Relations, Hon Tony Burke MP, is separately progressing proposed legislation to include an express prohibition on sexual harassment in the Fair Work Act 2009 (Cth).

Positive duty to eliminate unlawful sex discrimination etc.

The proposed introduction of the Federal positive duty on duty holders implements the primary recommendation of the Respect@Work Report (Recommendation 17). This Recommendation was aimed at shifting the responsibility away from victims of unlawful discrimination to raise complaints, by creating a positive obligation for duty holders to take proactive measures to eliminate such conduct in the first place.

Notably, the proposed duty in the Bill expands the scope of the recommended duty (and the existing duty in Victorian legislation) to cover new prohibitions against sex-based harassment (introduced by the Sex Discrimination and Fair Work (Respect at Work) Amendment Bill 2021), the prohibition against subjecting someone to a workplace environment which is hostile on the ground of sex (proposed by the Bill), and victimisation in relation to those matters.

To facilitate enforcement of the positive duty, the Bill inserts new provisions in the AHRC Act to enable the AHRC to monitor, assess and enforce compliance with the positive duty in the SDA, including powers to conduct inquiries, issue compliance notices, apply to the Federal courts for compliance orders, and enter into enforceable undertakings.  These functions are proposed to commence 12 months after Royal Assent.

However, in assessing compliance, the Bill proposes amendments to the SDA to specify a number of matters to be taken into account, namely:

• the size, nature and circumstances of the duty holder’s business or undertaking;
• the duty holder’s resources, whether financial or otherwise;
• the practicability and the cost of elimination steps; and
• any other relevant matter.

The intention is that this positive duty would operate concurrently with the requirement under the model work health and safety laws to provide, so far as is reasonably practicable, a safe working environment for workers.

Many employers have already taken significant action to address sexual harassment and discrimination, which will well prepare them for taking steps to discharge this positive duty. For those who haven’t yet reviewed their framework, there is an opportunity to do so given the positive steps that are required by the positive duty if the Bill passes.

Prohibition against workplace environments that are hostile on the ground of sex

This new prohibition implements Recommendation 16(c) of the Respect@Work Report, which was driven by a finding that sexual harassment is more likely to occur in workplace environments which are “sexually charged or hostile". The Explanatory Memorandum to the Bill suggests that “conduct such as displaying obscene or pornographic materials, general sexual banter, or innuendo and offensive jokes” could contribute to sexually hostile workplace and result in unlawful discrimination, such as sexual harassment.[1]

The Bill provides that this provision is breached if:

• a person engages in conduct in their workplace, or another person’s workplace; and
• the second person is present at the same time as or after the conduct occurs; and
• a reasonable person, having regard to all the circumstances, would have anticipated the possibility of the conduct resulting in the workplace environment being offensive, intimidating or humiliating to a person of the sex of the second person by reason of:
  • the sex of the person; or
  • the characteristic that appertains generally, or is generally imputed, to persons of the sex of the person.

Whilst this proposed amendment is significant in that it creates a new category of prohibited conduct, in reality, as conduct which falls within this category is likely to already be captured by existing prohibitions against sexual harassment, sex-based harassment or sex discrimination (or all of these prohibitions) we consider that it is unlikely to have a significant impact on claims and litigation under the SDA.

That being said, the introduction of the prohibition will have a broader impact in providing clarity and awareness amongst duty holders, and employees and workers alike, on what is unacceptable conduct in the workplace.

Representative applications (or 'class actions') and costs provisions

This amendment implements Recommendation 23 of the Respect@Work Report, and would enable a representative body that has lodged a complaint on behalf of one or more persons who have experienced unlawful discrimination in the AHRC, to make a representative application to the Federal courts.  The proposed provisions would operate in addition to the existing class actions provisions under Part IVA of the Federal Court of Australia Act 1976 (Cth) and are intended to be a more accessible mechanism for representative proceedings in the anti-discrimination context.

The Bill specifies proposed conditions for representative applications including that:

• there is an ability for a person to ‘opt out’ of the representative action;
• a class member cannot make a separate application in relation to the same claim unless they have opted out;
• a representative action cannot be settled without court approval; and
• a representative application may not be made without the written consent of each person on whose behalf the application is made.

The Explanatory Memorandum provides an example of a representative action, describing a scenario where an employment advocacy centre brings a representative action on behalf of four women within an organisation who have been demoted on their return from parental leave.[2]

In a further effort to increase accessibility for applicants, the Bill proposes to insert cost protection provisions in the AHRC Act, adopting a ‘costs neutrality’ approach, such that as a default position, each party bears their own costs in unlawful discrimination proceedings, but courts still retain discretion to depart from this position and make costs orders where they consider it just to do so. This differs from the Fair Work costs provisions which only permit costs to be ordered if a party instituted the proceedings vexatiously or without cause, or if the court is satisfied that a party’s unreasonable act or omission caused the other party to incur costs.

We will continue to track the progress of the Bill as it progresses through the Senate.

^{[1] Explanatory Memorandum, paragraph 6.}

^{[2] Explanatory Memorandum, paragraph 320.}

This article was prepared by Wendy Fauvel, Partner, Lucy Boyd, Senior Associate, and Josephine Mammone (Solicitor).