WHEN Kristy Fraser-Kirk brought a sexual harassment claim against retailer David Jones this week, much of the focus was on the figure.
After all, a $37 million claim for punitive damages sounds straight out of a courtroom in the US -- a country where anyone can sue for almost anything -- and far removed from the local reality where the record award for a sexual harassment case currently stands around $500,000.
Yet, ironically, had the 27-year-old publicist been employed at one of the larger US-based retailers instead, there is a good chance her complaint might not have seen the light of day thanks to a corporate culture more attuned to the risks of sexual harassment in the workplace.
Fraser-Kirk is now a household name thanks to the titillating nature of her allegations and the high-profile man they are directed towards.
Former David Jones chief executive Mark McInnes was as close to a corporate celebrity in Australia as one gets. Wealthy and successful -- he earned more than $35m during the seven years he oversaw the department store's revival and quadrupled the company's share price -- McInnes was a regular on Sydney's glitzy social scene. And it was no secret that the twice-divorced 45-year-old had no shortage of female admirers.
However, his reputation was tarnished forever on June 18 when it was revealed that a "mutual termination" of his employment had been agreed upon following incidents at two company functions.
McInnes's subsequent confession that he had acted in a manner that was unbecoming towards a female employee left little to the imagination and for weeks rumours swirled about the exact nature of his conduct. Supporters offered that McInnes had simply misread the woman's signals.
However, Fraser-Kirk's statement of claim, lobbed in the Federal Court on Monday after settlement negotiations with her employer apparently fell through late last week, lists the incidents in great detail.
It also points to a culture within the organisation that appears to have permitted harassment and bullying.
Fraser-Kirk alleges that McInnes first acted inappropriately towards her at a company luncheon held in May to celebrate the renewal of a contract with well-known racing trainer Gai Waterhouse.
Throughout the event, according to the claim, McInnes urged his employee to try a dessert that he likened to "a f . . k in the mouth", touched her under her clothing and repeatedly asked her to accompany him back to his Bondi home, which she declined.
Fraser-Kirk alleges that McInnes's behaviour towards her escalated at a company function two weeks later, where he touched her again beneath her clothes and attempted to kiss her against her will. She says the previous invitation to go home with him was repeated and she received a telephone call and a text message from her boss the next day, requesting that she meet him for dinner and a drink.
Fraser-Kirk also claims to have reported McInnes to her direct supervisor, Tahli Koch, and the company's public relations general manager, Anne-Maree Kelly, immediately after the first incident, only to be told by Kelly: "Next time that happens, you just need to be very clear and say, 'No, Mark', and he'll back off."
Fraser-Kirk says she later made it known that she was unwilling to travel to Melbourne for a work engagement because of her concerns about McInnes's unwelcome attention. Among other things, she is claiming that David Jones sent her to the second function despite knowing she was at risk of further unwelcome sexual advances, and has cited examples of four other women she claims have also been the subject of similar harassment.
The claim also points to a bullying complaint lodged against McInnes in 1999 before he was chief executive and a "bullying approach" later adopted under his watch that had "led to a reluctance by employees to raise concerns about management conduct".
The allegations, if proven to be true, reflect poorly on an organisation that has staunchly defended its policies in the area of workplace health and safety, including the prevention of sexual harassment and discrimination.
Most large publicly listed companies have similar policies. In fact, all are encouraged to publish details of any codes of conduct as part of the corporate governance guidelines put forward by the Australian Securities Exchange. While these codes are not required to make specific representations about harassment in the workplace, they are required to take into account how a company ensures it complies with various legal obligations. Sexual harassment is outlawed under federal and state legislation.
But if figures emerging from the most recent surveys on the subject are to be believed, the policies are not working.
The Australian Human Rights Commission conducted a national survey in 2008 and found that 22 per cent of women and 5 per cent of men claimed to have experienced sexual harassment at work. While that compared with 28 per cent of women and 7 per cent of men in 2003, indicating that progress was being made, Sex Discrimination Commissioner Elizabeth Broderick was deeply concerned about another finding.
"When we asked people about what they thought sexual harassment was, what we found was such a lack of understanding," Broderick tells The Weekend Australian. "People said 'no', when asked if they'd experienced sexual harassment. But when we asked them if they'd experienced any unwelcome touching or hugging, for example, they'd say, 'oh yeah, that happens quite regularly'."
Cases that appear before the Federal Court or state-based tribunals suggest that the same offences keep cropping up: unwanted touching, kissing, suggestive or pornographic emails and text messages, and persistent requests for dates.
In 2008, there was a Monash Medical School student who was compensated $100,000 after the Victorian Civil and Administrative Tribunal found her supervisor dropped his pants and grabbed her breast. The Federal Court last year heard the case of a woman who was sacked for purported shortfalls in her work performance after complaining that a colleague was badgering her to enter into a sexual relationship. The court found that the woman was terminated because she would not tolerate ongoing harassment. She was awarded $466,000 in damages, including compensations for pain and suffering and medical expenses incurred to treat depression and anxiety that she had suffered.
The Victorian Equal Opportunity & Human Rights Commission, which oversees the Equal Employment Opportunity Act, receives more than 200 complaints a year centred on sexual harassment. These are typically cases that have not been able to be resolved internally.
Commissioner Helen Szoke believes that the cases she sees are the tip of the iceberg, given that most people who experience harassment do not pursue the matter because they are embarrassed, fear adverse repercussions for their careers or lack confidence in their company's complaint resolution process.
Surprisingly, the cases do not all emerge from small businesses. "We see cases from across a range of businesses," Szoke says. "And, yes, some of those companies involved are large businesses that have (anti-harassment) policies and procedures in place. But it's not good enough to just have a policy."
As the David Jones case suggests, the existence of a policy is not enough to ensure that a company's board is made immediately aware of allegations levelled against a senior executive, which is ironic given the retailer's directors, including Australian Olympic Committee head John Coates and former Woolworths boss Reg Clairs, have been individually named as defendants.
David Jones chairman Bob Savage has insisted that neither he nor the board knew anything of McInnes acting inappropriately until it was brought to its attention days before his termination.
Peter Wilson, national president of the Australian Human Resources Institute, describes the bullying and sexual harassment of women in the workplace as a "corporate cancer", and believes that its prevalence despite legislation being in place for the past 25 years can be largely attributed to the lack of women on boards and within senior management.
(It is worth noting, though, that David Jones has Business Council of Australian chief executive Katie Lahey serving on its board and its management committee includes three women.)
"The evidence is clear that the very appearance of the female gender in male-dominated groups immediately changes behaviour," Wilson says.
"Generations X and Y are used to men and women sharing roles, at work and at home. Primarily this is an older-male problem."
Broderick agrees.
"The more hierarchical the environment, the more susceptible it is to sexual discrimination, especially those industries or organisations where there's a lot of junior women and a lot of senior men," she says.
While the quantum of Fraser-Kirk's claim has whipped talkback radio hosts and their listeners into a frenzy, it is clear that the $37m figure is part of a strategy designed to inflict punishment on McInnes, David Jones and its directors.
Even the timing of the court filing, which coincided with the store's spring-summer fashion launch -- one of its biggest publicity opportunities of the year -- smacked of a payback.
Fraser-Kirk has appointed the same legal firm that represented one-time PricewaterhouseCoopers partner Christina Rich in her high-profile harassment and discrimination case several years ago. Rich reportedly settled her complaint for more than $5m.
While some have painted the David Jones staffer as a gold-digger, she is not chasing a payout purely for herself. She is seeking unspecified damages relating to loss and damage and has said that any punitive damages would go to charity.
One former boss of a global investment bank says the case highlights how Australian companies lag when it comes to stamping out workplace harassment.
He points to the sexual harassment revolution that took place in the US during the 1990s that forced corporations to take seriously their obligations in providing a safe and harassment-free workplace. Just look at the damage caused to Smith Barney's reputation when a sexual harassment lawsuit filed by senior broker Pamela Martens in 1996 shone a light on the company's then-misogynist culture.
While the case and various others it sparked settled out of court, allegations against the bank were fleshed out in the book Tales from the Boom-Boom Room: Women vs Wall Street, published in 2002.
The book details a culture where women were routinely groped, called "whores" and banned from off-site meetings. When one woman complained about a male co-worker's conduct, she was apparently subjected to a grilling that included questions about her sex life, her gynaecological records and queries about her marriage breakdown.
"When I was working in New York, this sort of stuff was taken seriously because companies had learned the hard way that these cases can become very big problems. Big dollars are involved," says the banker, who is now based in Australia.
"In the US and Europe, what companies do is set up an anonymous telephone hotline so that employees can comfortably report any allegations to an independent party. The other thing is staff training. But in Australia, there really seems to be this 'she'll be right' attitude.
"But sexual harassment costs money, it costs reputations. "
Wilson agrees that Australian companies need to improve. The institute advocated four things all companies should do: establish a clear policy spelling out that sexual harassment is not acceptable, institute regular training programs, establish an external whistleblowing capability and act quickly when an issue arises.
While Wilson applauds Savage for his apparent swift action once McInnes's conduct came to his attention, he says most companies lag in this area. And many still do not have independent people handling whistleblowing, he says.
"I know corporate Australia will watch what happens with great interest," says Wilson. "It may well turn out to become a precedent. It has certainly sharpened awareness of the matter."
It is unlikely that the case will ever go to court. David Jones would no doubt be reluctant to see the matter go to trial, because of the risk of further embarrassing details emerging.
McInnes, who has been overseas with his pregnant girlfriend since mid-June, this week admitted to making mistakes but denied many of Fraser-Kirk's specific allegations.
Savage has said from the start that the company has been intent on supporting Fraser-Kirk. Yet his comments this week suggest that his patience could be running out.
"We have made it clear we value Ms Fraser-Kirk as an employee and we wanted her to return to work. If she chose not to return or she felt she was unable to return to work, we have made it clear we would be willing to compensate her for her loss." he told The Weekend Australian. "It was never our preference for this matter to be litigated and we made this clear. We are disappointed she felt it was necessary, but now proceedings have commenced, we have no option but to defend them."
A very interesting case indeed and in the context of bullying and harassement which falls under the WHS Legislation, what has your company done to assess the risk work bullying and harassment? Does your policy and procedure standard up to the test should an incident occur? Making sure you have a system in place that meets the guidelines is paramount.
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