Supermarket found vicariously liable for failing to adequately investigate employee’s sexual harassment claim
Case name: Evans v Ikkos Holdings Pty Ltd and Ythos Holdings Pty Ltd and Ikia Holdings Pty Ltd T/As Pasadena Foodland and Crugnale [2019] SAET 222
A worker filed a sexual harassment complaint against the head chef at an Adelaide supermarket, Pasadena Foodland.
After believing that the investigation into the incident was insufficient, the employee sought damages from her employer, claiming they were vicariously liable for harm she suffered.
The employer was ordered to contribute to $30,000 in general damages as they could not show that they had adequately addressed the harassment complaint.
This case highlights the implications for employers of the Positive Duty legislation under the Australian Sex Discrimination Act.
CASE BACKGROUND
In 2019, Pasadena Foodland faced allegations of failing to adequately investigate a sexual harassment complaint against its head chef, Camillo Crugnale. The complainant accused Crugnale of repeated inappropriate touching, prompting legal action in the South Australian Employment Tribunal.
INCIDENT DESCRIPTION
After several incidents of physical contact by Crugnale, the complainant reported a particular incident to the Assistant Store Manager and HR Manager, who viewed CCTV footage of the location where the incident took place. They apparently did not find conclusive evidence, due to the camera angle.
According to the Tribunal, neither man treated the complaint seriously, nor took any statement from the woman or recorded what she said. The CCTV footage was not carefully examined and was destroyed shortly after. No further steps were taken by the employer at this time.
The Tribunal said that the ‘careless approach to the complaint and the viewing of the footage is an important element with respect to’ the employer’s liability.
LEGAL PROCEEDINGS AND DECISION
After some time, the matter was escalated to the store’s General Manager who met with the complainant and her union representative. The employer concluded that the allegations could not be proven and no further action was taken.
The employee applied to the South Australian Employment Relations Tribunal, alleging that the employer was vicariously liable for a psychological disorder she suffered as a result of the sexual harassment.
The employee sought $150,000 in general damages.
OUTCOME
The judge presiding over the case awarded the complainant $30,000 in compensation for psychological harm. The tribunal found both Pasadena Foodland and Crugnale jointly liable for breaching the State Equal Opportunity Act 1984 due to their failure to properly address the harassment complaint.
The employer argued it had taken reasonable steps to prevent sexual harassment from occurring because it:
- Had a workplace policy for the prevention and reporting of sexual harassment.
- Felt the employee who had allegedly engaged in sexual harassment was aware of and understood that policy.
- Had investigated the complaint.
The Tribunal found that this was inadequate.
It concluded that the employer having a policy in place for the prevention and reporting of sexual harassment was not enough to prevent inappropriate behaviour. Similarly, although the man was aware of and understood that policy, it didn’t deter him from inappropriate behaviour.
The failure to properly investigate the claims formed the basis to find the employer vicariously liable.
Areas where the employer was found to be lacking included:
- No formal investigation was undertaken,
- The employee was not asked to provide a statement,
- Witnesses weren’t interviewed,
- No steps were taken to preserve the CCTV footage and
- The matter wasn’t escalated to senior management.
IMPLICATIONS FOR EMPLOYERS
The tribunal’s decision highlights the significance of conducting thorough and impartial investigations into workplace harassment complaints.
The case underscores the importance of organisations taking proactive measures to address and prevent unlawful conduct in the workplace. Employers must ensure comprehensive training and robust investigative procedures are in place to uphold the Positive Duty mandated by the Australian Sex Discrimination Act.
KEY LESSONS
- Review and enforce policies on code of conduct, harassment and grievance procedures.
- Promptly address inappropriate behaviour to prevent escalation.
- Communicate to employees that actions are being taken.
- Conduct impartial investigations and maintain thorough records.
- Provide adequate training to staff on recognising and addressing workplace harassment.
- Consider engaging external investigators for impartiality and expertise.
CONCLUSION
Pasadena Foodland faced financial repercussions and reputational damage as a result of the case. This case serves as a cautionary tale for employers, emphasising the legal and financial consequences of failing to meet the Positive Duty requirements. Businesses must be proactive in their handling of any claims of workplace sexual harassment. By prioritising a safe and respectful work environment and implementing robust policies and procedures, businesses can mitigate the risk of legal liability and protect the well-being of their employees.
Reference
Details of this case are published by the Federal Court of Australia.
If you would like to make sure your business has comprehensive training and robust investigative procedures in place that uphold your positive duty, Contact Us. It’s crucial you take proactive measures to avoid not only harm to your employees, but the financial and reputational repercussions to your business.
