The NT Anti-Discrimination Tribunal has found an Aboriginal economic development company vicariously liable for race discrimination committed by two of its employees despite it having anti-discrimination policies and procedures in place, because it did not support these policies with training.
This case sends a clear warning to employers about the steps it needs to take to avoid successful claims of vicarious liability.
The facts of the case involved a complaint by Frances Newchurch – a Ngarrindjeri and Kaurna, Narrunga woman – that in the course of her employment with Centreprise Resource Group (Centreprise) she was discriminated against by two of her colleagues. The Tribunal upheld the complaint, finding that Ms Newchurch had been subjected to unfavourable treatment because of her race. The treatment involved derogatory comments towards Ms Newchurch on the basis of her race, which, ‘[impaired] Ms Newchurch’s equality of opportunity to enjoy just and favourable conditions in a comfortable, inclusive and supported work environment where she felt secure and valued’.
As the racial discrimination took place at work, Ms Newchurch pursued her claim not only against the perpetrators themselves, but also against Centreprise for vicarious liability. To successfully defend this claim, Centreprise had to establish that it took ‘all reasonable steps’ to prevent the discrimination.
In attempting to discharge this burden, Centreprise was able to demonstrate to the Tribunal that it had anti-discrimination policies and procedures in place and required employees to comply with these in their contracts of employment.
The Tribunal said that the existence of these policies and procedures, regardless of how comprehensive they were, was ‘insufficient’ because Centreprise had not provided its workers with anti-discrimination training and therefore had not taken all reasonable steps to prevent the discrimination of Ms Newchurch. As a result, Centreprise was found to be vicariously liable and ordered to pay 25% of the total compensation awarded to Ms Newchurch.
This case gives a very clear warning to all organisations that to successfully defend claims of vicarious liability – or, considering the significant time, reputational and financial burden that accompanies these claims, to avoid them altogether – all reasonable steps must be taken to prevent unlawful behaviour in the workplace. While policies remain a critical part of this, unless they are supported by a comprehensive training package they simply will not be enough.