When things go wrong: Expensive lessons arising from inappropriate behaviour in the workplace

Magar v Khan [2025] FCA 874

In this case, the employee (Ms Magar) alleged that during the course of her employment, her employer, the business owner and senior manager (Mr Khan) and other male members of a group of employees, sexually harassed her, harassed her on the ground of sex, and victimised her for complaining about Mr Khan’s conduct in breach of the Sex Discrimination Act 1984 (Cth) (SD Act).

Throughout her employment, Ms Magar alleged that:

• she experienced sexual comments, questions of a sexual nature, and conduct of a sexual nature from Mr Khan (together, Mr Khan’s Conduct);
• Mr Khan, along with another manager of the store, made derogatory statements dictating how she and other women should dress, notably her wearing skinny jeans (Managers’ Conduct); and
• after Ms Magar made a complaint in relation to the conduct, Mr Khan threatened to commence defamation proceedings against her (Defamation Threats).

During the proceedings, Mr Khan denied that he engaged in the alleged conduct.

The Court found that:

• Mr Khan’s Conduct constituted sexual harassment within the meaning of the SD Act, and as a result, Mr Khan contravened of the SD Act;
• the Defamation Threats constituted victimisation within the meaning of the SD Act, and as a result, Mr Khan contravened the SD Act; and
• the Managers’ Conduct did not constitute harassment under section 28AA of the SD Act, as it could not have been “legally characterised as harassment on the ground of sex in relation to Ms Magar, beyond being sexist and boorish behaviour.”

Mr Khan was ordered to pay general damages to Ms Magar in the amount of $175,000 and compensation in the amount of $130,000 (totalling $305,000).

This was the first case to consider the new provisions relating to sex-based harassment and the comments by the Judge give us direction as to how the Court is likely to assess the conduct. Importantly, Justice Bromwich said “although the conduct does not have to be directly addressed to the person harassed, some nexus is still required, in that the conduct must be in relation to the person harassed”.

Justice Bromwich did note that if the demeaning comments and purported humour as to sexual activity had been proven to be about, or otherwise directed at, Ms Magar, that would likely have been considered harassment on the ground of sex.

SafeWork NSW v Marist Youth Care Limited [2024] NSWDC 74

Over several years, two female workers experienced a range of distressing behaviours when assisting residents with cooking, housework, administering medication, facilitating activities and transport at a care home for young persons. The behaviour included sexual touching, inappropriate comments, derogatory names, requests to perform sexual acts, being physically grabbed and being threatened with violence. As a result. both workers were diagnosed with post-traumatic stress disorder, as well as other injuries.

SafeWork NSW conducted an investigation and found that the employer failed to address risks of inappropriate sexual and violent behaviour by residents, which led to the psychological injury of the two employees.

Proceedings were commenced by SafeWork NSW for breaches of the Work Health and Safety Act 2011 (NSW) (WHS Act).

In determining that there had been breaches of the WHS Act, the Court considered the following factors:

• the employer was aware that each of the residents was a potential source of work-related violence for the workers and the employer should have known from their history and behaviour that the residents posed a risk of assault, inappropriate sexual behaviour and aggression towards the female workers;
• the risk was known and recorded, and there were multiple failures by management to respond to initial incidents. In particular, the manager’s response was seriously inadequate;
• the likelihood of the risk occurring was high; and
• the employer should have conducted risk assessments relating to the risk posed to the workers.This was an available step that would have caused little inconvenience to the employer.

The employer was convicted and ordered to pay a fine of $300,000 and pay the prosecutor’s costs for the proceedings in the amount of $140,000.

Key Takeaways for Employers

These decisions highlight that employers must take proactive steps to prevent and respond to inappropriate conduct in the workplace. Specifically, employers must:

• take proactive steps to identify and manage risks including sexual harassment and violence in the workplace. Conduct risk assessments and implement appropriate control measures, particularly where there is a foreseeable risk (such as working in environments with known behavioural concerns);
• ensure managers and supervisors are trained to respond appropriately to complaints and incidents. Inadequate or dismissive responses from leadership can increase liability for an employer (and the individuals involved);
• ensure reporting mechanisms are clear, accessible and protective of employees. Employers must also maintain confidentiality (to the extent possible) and take action against any form of retaliation or intimidation following a complaint; and
• be aware that sexual harassment includes verbal and physical conduct. Employers must educate staff on what constitutes sexual harassment.

The cases also raise common themes that tend to arise in investigations and provide guidance on potential risks. For example, it is not uncommon for a respondent in an investigation to allege that they are being defamed by the complainant. In Ms Magar’s case, the Judge determined that a threat to sue for defamation amounted to victimisation and was unlawful under the SD Act.

These cases also serve as a timely reminder about compliance with the “positive duty” under the SD Act. What steps is your organisation taking, could it be doing more?

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Authored by:

Erin Lynch, Partner
Isabella Kiparizov, Lawyer