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Change to law relating to sexual harassment – extensive new jurisdiction for Fair Work Commission

Published on April 21, 2023 by Peter Punch

Introduction

This is the second part of a two part article on the extensive recent changes to Federal workplace laws in relation to sexual harassment claims and disputes. These changes came into effect on 6 March 2023.

As was mentioned in the first part of this article, Part 8 of Schedule 1 to the recent Amendment Act [1] introduces a new Part 3-5A in Chapter 3 of the principal Federal Statute, [2] that Part being entitled “Prohibiting sexual harassment in connection with work”, together with a number of other ancillary provisions in connection with the operation of that new Part.

While new Sections 527D and 527E of the FW Act, discussed in the first part of this article, are central elements of the reforms in relation to sexual harassment in respect of the workplace, at least as important are new measures substantially enhancing the role of the Fair Work Commission (FWC) in dealing with this subject.

FWC placed at the centre of sexual harassment dispute resolution

Prior to the SJBP Act, complaints and disputes about alleged sexual harassment were essentially channeled through the Federal or State anti-discrimination/human rights agencies. They were not normally the domain of FWC. Thus, the investigation and resolution of those matters so far as they related to workplaces (the main area where they arise) was dealt with outside of the principal agency under Federal law charged with dealing with workplace disputes. This has always been less than satisfactory, in that the human rights/anti-discrimination frameworks for resolving these disputes were technical, cumbersome and often very slow or practically ineffective for complainants.

The SJBP Act remedies that gap in the law and in doing so implements a regime that places FWC at the centre of complaint handling and resolution of sexual harassment matters in or connected to the workplace.

Summary of FWC’s new jurisdiction and powers in this field

The following is by necessity a summary only of the new FWC jurisdiction and powers – a study of all its provisions will, as is usual with new legislation, reveal exceptions and limitations to the general thrust of the reforms that are being introduced. However, the below commentary endeavours to embrace all the main elements of these major reforms.

Two “arms” of FWC jurisdiction

1. FWC’s new jurisdiction has two “arms”: one is the power to make a “stop sexual harassment order” and the other is to deal with a sexual harassment dispute (Section 527F).

2. Under that first arm, if FWC receives an application under Section 527F (1) that includes a request for a “stop sexual harassment order (“stop order”), FWC must start to deal with the application within 14 days of the application having been made (Section 527F (2). If satisfied that the aggrieved person has been sexually harassed by one or more persons, and that there is a risk that such harassment will continue, FWC may make “any order it considers appropriate (other than an order requiring payment of a pecuniary amount) to prevent the aggrieved person from being sexually harassed” (Section 527F (1)). It is clear that this power to make a stop order is discretionary, and that FWC must take into account a range of matters before making such an order, such as any final or interim outcomes of an investigation into the matter, or any dispute resolution procedure available to the aggrieved person (Section 527F (3)). Breaching a stop order attracts a civil penalty of up to 60 penalty units (currently $16,500).

3. Under the second arm (dealing with a sexual harassment dispute), if FWC receives an application that is not solely confined to seeking a stop order, then it must deal with the dispute in the first instance by conciliation or mediation, conducted in private (Section 527R (1) and (2)). If after such processes FWC is satisfied that all reasonable attempts to resolve the dispute (other than by arbitration) have been or are unlikely to be successful, FWC must issue a certificate to that effect and, if it believes that arbitration or a court application has no reasonable prospects of success, advise the parties accordingly (Section 527R (3)).

FWC’s new but limited arbitration jurisdiction

4. FWC is empowered by Section 527S to conduct binding arbitration of a sexual harassment dispute that is the subject of a certificate of failed conciliation/mediation under Section 527R (3). If it does so, it is empowered to make various orders and express various opinions pursuant to Section 527S (3). It can express an opinion that it would be inappropriate to take further action in the matter, or that a respondent to the dispute has sexually harassed one or more aggrieved persons, or that a respondent in relation to the dispute is vicariously liable for another party’s contravention pursuant to Section 527F. The orders it can make include an order for compensation (uncapped) and the payment of lost remuneration to an aggrieved person, and an order requiring a person to perform any reasonable act or carry out any reasonable course of conduct to redress loss or damage suffered by an aggrieved person.

5. While this new arbitration jurisdiction for FWC is a significant development in this area of the law, it has these limitations within Section 527S (1):
   

a) It can only be invoked if there is agreement to do so by an aggrieved person and a respondent to the dispute (that is, protagonists – e.g. one alleged victim and the victim’s alleged harasser);

b) If it is invoked by two such parties, all other parties to the dispute must be removed from the proceedings;

c) It must be invoked within sixty (60) days of the issue of a certificate under Section 527R (3)).

[This aspect of the new measures is further discussed below.]

Multi party proceedings

6. Another significant element of this new FWC jurisdiction is the facility for multi party proceedings pursuant to Section 527F (4). That is, FWC may make rules which will allow for 2 or more aggrieved persons to make the one application, and for an industrial association entitled to enrol them as members to be joined in that application or to make the application for them or some of them (paragraph (a) of Sub section (4)). Furthermore, FWC will be able to make procedural rules that allows the joinder to a sexual harassment dispute of other aggrieved persons (i.e. alleged victims of the harasser), one or more industrial associations entitled to enrol any such persons, and an employer or principal of the person alleged perpetrator of the harassment (paragraph (b) of Sub section (4)).

Extended time period for lodging claims

7. Another significant aspect of this new FWC jurisdiction is that there is a comparatively generous time period for making an application – Section 527G states that “FWC may dismiss an application that is made under Section 527F more than 24 months after the contravention, or the last of the contraventions…is alleged to have occurred”.

That is, an application can be made up to two years after the date upon which the contravention, or the last contravention occurred, but an application can be made at any time after that date, if FWC is prepared to allow it. This can be contrasted with other current FWC jurisdictions in connection with individual workplace disputes – claims for relief in relation to unfair dismissal or breach of the General Protections provisions of the FW Act must be filed within 21 days of the date of an employee’s dismissal, unless FWC grants an extension of time (and FWC in practice is not known for granting such extensions lightly).

FWC will be the first “port of call” for claims

8. A final important element of this reform of the law is contained in Section 527T. The main aspect of that Section is this: except in the case of an application for an interim injunction, an application cannot be made to a court (e.g. the Federal Court) in relation to a sexual harassment dispute unless FWC has issued a certificate (of failed conciliation/mediation) under Section 527R (3)) and the application to the court is made within 60 days of the certificate being issued.

The practical effect of this provision is that it ensures that the bulk of applications or claims in relation to sexual harassment in the workplace will be dealt with by FWC at least in the first instance, in much the same way as the bulk of claims that fall within the ambit of the General Protections provisions of the FW Act will be dealt with by FWC.

Final comments on new FWC jurisdiction

It is reasonable to expect that the new FWC jurisdiction in relation to sexual harassment disputes will be busy, at least in the months to come. It has a number of features highlighted above that would make it more attractive to complainants and their legal advisors or union representatives than the traditional avenues such as proceedings in the Human Rights Commission or State administrative tribunals. However, it has to be doubtful as to whether FWC’s arbitration jurisdiction will attract many matters – such jurisdiction cannot be activated in an unresolved sexual harassment dispute unless at least one of the respondents (i.e. one of the alleged harassers or their employer) consents to FWC arbitrating the dispute. Such respondents would usually be advised to retain their right to contest claims against them in a court such as the Federal Court. In this regard it is to be noted that FWC was granted a similar “consent jurisdiction” in relation to General Protections claims (see Section 369 of the FW Act) almost 10 years ago, but that jurisdiction has rarely been exercised. That having been said, there can be no doubt that the powers made available to FWC by the SJBP Act in the area of sexual harassment disputes will serve to “focus minds” in a practical way when claims of sexual harassment are raised.

P J PUNCH

 

Want to learn more about the major changes surrounding national workplace laws? Read more of Peter Punch’s series here:

1. Federal Secure Jobs, Better Pay Act – It’s not just about workplace bargaining! Many other changes rolling out this year … here’s an introduction!
2. Sexual harassment at the workplace – additional protections for employees and other types of workers