Attack is generally not the best means of defence in sexual harassment litigation
Recent sexual harassment decisions show that aggressive defence strategies can lead to victimisation and aggravated damages.
Two decisions in sexual harassment cases illustrate that going on the attack is not always the best means of defence in sexual harassment litigation. Overly aggressive responses by employers or individual respondents can result in awards for victimisation and aggravated damages.
Mahar v Khan [2025] FCA 874
Ms Magar, a young international student working as a shift supervisor at a franchise, was subjected to repeated and escalating sexual harassment by a director of her employer. This included asking intrusive questions about her sexual history, making explicit comments about the director’s own sexual activity and showing her pornographic material.
The Court accepted Ms Magar’s account, pointing to the consistency of her evidence, her visible distress and the clear power imbalance in the employment relationship. After she stopped working and made complaints, first to the franchisor and then through her lawyers, Mr Khan’s solicitors sent defamation concerns notices to her demanding she withdraw the allegations and threatening legal proceedings. The Court found those notices caused her genuine distress and amounted to unlawful victimisation under the Sex Discrimination Act 1984 (Cth) [1].
Ms Magar was awarded $305,000 plus legal costs, including damages for economic loss, general damages, victimisation and aggravated damages. The Court awarded $10,000 for victimisation, finding the defamation notices were a retaliatory response to her complaints and caused real harm. It also awarded $5,000 in aggravated damages, not because of the victimisation itself, but due to the way the defence was conducted at trial, particularly the making of unsubstantiated and untested allegations about Ms Magar’s character.
Taylor v August and Pemberton Pty Ltd [2023] FCA 1313
Ms Taylor brought proceedings for sexual harassment and victimisation under the Sex Discrimination Act. The Court found that, over a 22-month period, a director of her employer engaged in unwelcome conduct, including a deliberate slap on Ms Taylor’s buttock and making repeated romantic overtures, after she rejected his advances.
The Court emphasised the power imbalance between the director and a junior employee, the private settings in which the conduct occurred and the fact that a reasonable person would have anticipated such behaviour would cause offence, humiliation, or intimidation. Ms Taylor also experienced significant psychological effects as a result of the conduct, including anxiety, sleeplessness and a panic attack, reinforcing the seriousness of the conduct.
Following Ms Taylor making a complaint to the Australian Human Rights Commission, the employer’s response included sending aggressive legal correspondence demanding repayment of gifts, accusations of dishonesty and theft and threats of legal action, all aimed at pressuring her to withdraw her complaint. The Court found this amounted to victimisation.
The Court awarded substantial compensation including economic loss, $140,000 in general damages, $40,000 for victimisation, and $15,000 in aggravated damages, reflecting the distress caused both by the harassment and the employer’s improper conduct during the dispute.
Justice Katzmann noted, where appropriate, aggravated damages may be awarded as additional compensation for the injured feelings of an applicant where the applicant's sense of injury resulting from the wrongful physical act is heightened by the manner in which or the motive for which the respondent engaged in the conduct. Further, aggravated damages may also be awarded to an applicant whose distress is made worse by the respondent’s conduct afterthe wrongful acts are committed. That can include the conduct of the defence.
Conclusion
The decisions reinforce that responding to sexual harassment complaints with defamation concerns notices can amount to victimisation and that making baseless allegations about a complainant’s character during a hearing can result in award of aggravated damages. Employers who are used to conducting litigation aggressively may need to re-think their approach when responding to sexual harassment litigation. Employment Practices Liability Insurers should be aware of the potential for awards to increase if their insureds victimise complainants or respond inappropriately to sexual harassment complaints.
This publication constitutes a summary of the information of the subject matter covered. This information is not intended to be nor should it be relied upon as legal or any other type of professional advice. For further information in relation to this subject matter please contact the author.
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