Small business pays a hefty price tag for pregnancy discrimination

Almost 50 per cent of women still experience discrimination in the workplace at some point during pregnancy, parental leave or when they return to work, a landmark study by the Human Rights Commission shows. Former Sex Discrimination Commissioner, Elizabeth Broderick, had said that such widespread discrimination carried a cost – limiting women’s participation in paid work as well as the productivity of businesses.

A recent decision made by the FCCA, is a case in point that clearly outlines to all employers – including small business owners (and individuals) – of how a failure to understand the nature of their obligations to pregnant employees can attract hefty penalties.

The damages awarded by the Court were considerable and included $164,079 for total economic loss and $10,000 for distress, hurt and humiliation. In addition, the Court awarded penalties of $45,000 to be paid by the business and $8,000 to be paid by each of the two individual owners for their deliberate violations of the pregnant employee’s rights. The Court viewed these contraventions seriously and awarded these penalties as a need “to signal its disapproval of pregnancy discrimination and deter other businesses (particularly small businesses) from engaging in similar behaviour”.

According to Court findings, the operators of a portrait photography business took “adverse action” against their photographer-cum-salesperson by dismissing her and injuring her in her employment when she chose to exercise her workplace rights as a result of her pregnancy and new family/carer responsibilities.

After she announced her pregnancy to her employer, their conduct towards her became highly inappropriate and eventually led to her dismissal. The discriminatory conduct included questioning her ability to work late, suggesting a need to reconsider their profit-sharing plans with her after their retirement, requiring her to work behind the scenes and consequently to take a pay cut once her pregnancy became visible (as it was not a ‘good look’ for customers to see), unilaterally reducing her remuneration based upon her failure to meet her newly imposed sales targets and being asked to work “whatever hours it takes” to meet those targets. They even refused her request to commence work part-time after the birth of her child, and required her to utilise her long service leave before the birth of her child given her pregnancy.

The Court noted that while the employer raised concerns for the employee’s safety (such as working outdoors on long shoots and carrying heavy equipment), the business never sought to obtain any medical opinion on her fitness and ability to undertake her regular duties; a failure to consider section 73 of the Fair Work Act. Hence, any judgement the business made that she was unable to perform the inherent requirements of her job as a result of the pregnancy was “not based on objective evidence”.

This case shows how important it is for employers to be conscious of how they deal with the needs of their pregnant employees. Even if a business has genuine concerns about a pregnant employee’s ability to perform work safely, employers need to be aware that any decisions they make due to an employee’s pregnancy or child caring responsibilities may be seen as discriminatory.

iHR Australia offers employee relations training programs which provide techniques and tools to prevent and manage discriminatory behaviour and maintain an appropriate workplace culture. Equip your management to mitigate the risk of adverse action claims using lawful ways to manage behaviour and conduct, and ensure compliance obligations are met. iHR’s onsite and public Anti-Discrimination and Bullying training programs addresses relevant legislation, individual and leadership behaviour and workplace culture which includes how to deal with pregnant employees in a fair and just way, in accordance with the Fair Work Act, EEO and discrimination legislation.