Sexual harassment in the workplace, employers & the AHRC national inquiry

 Sexual harassment in the workplace

Many employers will understandably want to run a million miles from publicly disclosing experiences about sexual harassment in their workplaces, however, Anthony Wood argues that employers need to speak up and ensure their views are represented

In June, the Australian Human Rights Commission (AHRC) established a year-long national inquiry into sexual harassment in the workplace, led by the Sex Discrimination Commissioner, Kate Jenkins.

The terms of reference are broad: ranging from the impact of social media, to exploring the workplace characteristics and practices which are more likely to increase the risk of sexual harassment.

Impetus for the National Inquiry has just been provided by the release in September of the AHRC’s fourth national workplace sexual harassment survey. Although the survey results are hardly scientific, there are some strong indicators about the prevalence of sexual harassment in Australian workplaces.

The results of the 2018 National Survey indicate that one in three people (33 per cent) have experienced sexual harassment at work in the last five years, and that in the last twelve months, 23 per cent of women in the Australian workforce have experienced some form of workplace sexual harassment, compared with 16 per cent of men. The findings confirm that sexual harassment is “widespread and pervasive”, according to Commissioner Jenkins.

In addition, it’s abundantly clear to lawyers practising in this area that the impact of the #MeToo campaign, coupled with a greater awareness by employees of their legal rights and a progressively greater transparency by employers in addressing sexual harassment complaints, has contributed to a large increase in claims over the last year.

Because employers can no longer afford the reputational risk and brand damage from sexual harassment, the aberrant conduct of employees who have been traditionally protected by their status and seniority is no longer exempt from consequences.

Submissions to the national inquiry
So, how is all of this likely to translate into action during the AHRC’s Inquiry? And what should employers be doing in response to the inquiry?

“Few employers will want to air dirty laundry, lest they be drawn into any controversy”

Many employers will understandably want to run a million miles from publicly disclosing experiences about sexual harassment in their workplaces. Few employers will want to air dirty laundry, lest they be drawn into any controversy – especially when most employers go to great lengths to avoid publicity associated with unsavoury conduct arising in their business.

Accordingly, the Commission’s public consultation process is unlikely to extract much new information from employers. This would be unfortunate, because the historical secrecy from employers on this topic means that their interests may be underrepresented in public debate.

Further, given that recommendations could arise from the inquiry on issues like the use of non-disclosure agreements (NDAs), employers could miss out on the important opportunity to defend the utility of such arrangements. Employers should bear in mind that they can make confidential and even anonymous submissions to the Inquiry, although the latter is likely to be less persuasive.

If there are employers with confident leadership and a strong culture, as well as a commitment to empowering your workforce and the eradication of harassment, now is the time to make your voices heard.

The use of non-disclosure agreements and the UK experience
One issue that is bound to arise in the National Inquiry is the practice adopted by many employers of reaching confidential settlements in sexual harassment claims which include strict non-disclosure obligations. The habitual use of NDAs by employers seeking to protect their reputations from sexual harassment allegations has long been a trend in the US and UK, but the practice has only recently come under fire in Australia.

The UK House of Commons’ Women and Equalities Committee recently investigated numerous aspects of sexual harassment and released a report in July 2018. If the UK report is anything to go by, Australian employers should expect criticism for their current practices. The UK Committee condemned employers for “ignor[ing] their responsibilities” and “failing to tackle unlawful behaviours”.

“NDAs provide value to both parties by resolving a complaint without the need for protracted, costly and unpleasant litigation”

The UK report made a number of wide-ranging recommendations for changes to their legal system, including to extend the time limit for bringing sexual harassment claims, introducing a mandatory duty to protect against sexual harassment; and, perhaps most controversially, to restrict the use of NDAs in settling claims.

In many instances, NDAs provide value to both parties by resolving a complaint without the need for protracted, costly and unpleasant litigation. It’s a practical reality that businesses regularly settle both worthy and unmeritorious claims for the sake of commercial certainty. Employers would undoubtedly be less inclined to do so where confidentiality isn’t preserved.

Similarly, not all complainants wish to air their grievances in public. In fact, victims of sexual harassment are often just as keen to settle a complaint privately and confidentially as an employer or individual respondent. An outright ban on NDAs might have the unintended consequence of preventing victims from coming forward in the first place.

Alternative options for settlements of sexual harassment claims
Looking to examples abroad, there are two alternatives to an outright ban on NDAs which could be considered in Australia.

The first is independent legal advice for settlements. It has long been the practice in the UK that statutory employment claims cannot be waived unless the individual has received independent legal advice on the agreement.

Whilst employers might shudder at the thought of inviting more lawyers to the table, working with a lawyer on the other side can often prove simpler and more efficient then dealing with an unrepresented party. From a public policy perspective, this reform would certainly be more effective in ensuring a complainant understands their legal position.

Another option which draws from the US experience is a mandatory cooling-off period for settling sexual harassment complaints. Whilst this type of ‘nanny-state’ approach may find some appeal if it arises during the Australian Inquiry, it will invariably create some frustration amongst many employers who would prefer to reach an immediate and binding settlement of a sexual harassment claim.

The direction and outcomes of the National Inquiry are uncertain. But unless some bold employers are prepared to make submissions before the cut-off on 31 January 2019, their interests may not receive appropriate attention: the UK report is clear evidence of this. To ensure that employers’ views are represented in the public debate, businesses will need to stand up and share their experiences.