The unexpected and expensive consequence of #MeToo

THE growing movement to bring down sexual predators comes with another unexpected - and expensive - effect.

AUSTRALIAN employers have been warned to fix their sexual harassment policies, or the problem will cost them — big time.

With the #MeToo movement sweeping the entertainment industry and expected to permeate other lines of work, a tsunami of complaints looks to send businesses insurance premiums skyrocketing.

Sydney employment lawyer John Laxon told news.com.au there was a likelihood the spike in complaints about sexual harassment in the workplace would hit employers’ bottom lines.

“I anticipate that if more people come forward and bring claims, or go off work injured as a result of sexual harassment, then the natural conclusion is that insurance premiums will rise,” Mr Laxon said. “I see that there is a likelihood that might eventuate.”

Explaining how a spate of complaints could affect an employer’s bottom line when it came to insurance costs, Mr Laxon said there was “an obvious link” between those ongoing costs and how they handle sexual harassment.

“Employers are liable for injuries received by employees, either at or away from their place of employment and that’s under various pieces of legislation,” he said.

Christie Whelan Brown was one of three women to allege they were sexually harassed by actor Craig McLachlan in 2014 while performing in The Rocky Horror Show. Picture: 7:30/ABC

“So you can easily foresee that if the sexual harassment causes or contributes to an injury or the onset of that injury, then that’s a loss that the victim suffers because of the conduct of the harasser, and that’s something for which an employer will be — and have been — held vicariously liable.”

Mr Laxon said if WorkCover claims are made, personal leave is to be taken, or litigation costs are incurred and bosses would have to pay.

The simplest solution, he said, was to get on the front foot and have policies in place to eliminate or reduce the risk of sexual harassment at work.

“It’s almost impossible to avoid all risk, but if an employer has proper policies and procedures in place, training seminars for staff, which the employer implements, actually believes in, and applies, as opposed to just paying lip service to, then that could prevent or at least reduce the risk of these types of incidents and unlawful behaviours occurring, and as a result you might think claims would be reduced,” Mr Laxon said.

“But obviously, if an employer does not have adequate policies and procedures in place to deal with sexual harassment, and is subjected to a number of claims for injuries that are suffered because of conduct of employees who harass, then it follows that will have a direct impact on premiums.

McLachlan has denied all allegations of sexual misconduct after complaints surfaced about his behaviour. Photo: Calum Robertson

“Sexual harassment can lead to all sorts of terrible injuries for people — commonly psychological injuries like adjustment disorder, depression, PTSD. There can be all sorts of effects which can in turn impact on a person’s ability to work.

“So long as there’s a causal connection between the sexual harassment and the injury, if claims are made and money has to be paid out, or if a worker goes off injured and their compensation has to be paid by the insurer, then you would expect that premiums will be reviewed and will rise.”

The prediction has been echoed by Australian journalist Tracey Spicer, whose local push to out offenders in the media, arts and entertainment industries has seen several high-profile figures investigated.

Following the publication of sexual harassment allegations levelled against TV and theatre star Craig McLachlan this week, the broadcaster and author tweeted: “I would say that insurance premiums for all workplaces will skyrocket unless they show that they take complaints of sexual harassment seriously.”

Mr Laxon agreed with the prediction that the expensive consequence was likely to hit all industries. “Sexual harassment is across all industries. It’s not just film and television and theatre. It’s everywhere,” he said.