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Employers can be found vicariously liable for alleged sexual assault that occurred between employees outside working hours but only where it was connected with their employment, according to a leading employment law expert.
PwC is facing legal action claiming the accountancy firm is liable for the alleged rape of a graduate employee following after-work drinks.
The graduate employee is suing PwC for damages over two alleged incidents of sexual assault by a colleague after work hours, court documents show. It includes one claim that the young woman was raped at her home after she went to pubs with colleagues following a meeting held at PwC’s office.
A case management hearing was held in early April and the proceeding was referred for mediation.
PwC is arguing it’s not liable because the alleged incidents were not connected to her or the alleged perpetrator’s role as a worker at the firm, and the graduate did not directly work with the accused.
Josh Bornstein, an employment lawyer at Maurice Blackburn who was not involved in the case and was speaking generally, said the question for the courts in such cases is whether the conduct has a “connection with the employment” of the employee.
“There have been a number of cases in recent decades that have established that employers are liable for sexual harassment and sexual assault including rape that has occurred outside working hours and outside the physical workplace,” he said.
“The overwhelming majority of cases of this nature tend to resolve out of court.”
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The graduate continued to work for a month after the alleged incident, but has not returned to her job at the firm since last September due to the stress and anxiety arising from the assault, according to court documents.
The New South Wales police conducted an investigation into the claims after a report was made last year, but no charges have been laid.
Court documents show PwC argued the incident was not connected to the graduate or manager’s role at the firm because it did not direct her or the manager to attend the pub, and had no capacity to supervise or issue directions.
The firm argued it was also not vicariously liable for the alleged incident because PwC had took “all reasonable steps” to prevent such behaviour.
It pointed out that the alleged perpetrator completed two training modules in 2022 on workplace behaviour that covered preventing sexual harassment. Two months before the alleged incident, they say that the man completed another introductory training on preventing sexual harassment.
“With respect to the workplace, [PwC] has a zero tolerance policy for sexual harassment in the workplace. It has a robust suite of policies, bespoke compulsory training, and initiatives directed at addressing sexual harassment risks at work,” the firm’s lawyer wrote.
