There has recently been significant media attention concerning certain high profile executives having “inappropriate relationships” with employees within their organisations.
These stories raise questions about the scope of an employer’s ability to regulate personal relationships in the workplace.
So, when does a personal relationship become an employer’s business?
Dating a colleague – Whose business is it anyway?
It is not unusual for relationships to develop in the workplace. After all, we spend a large portion of our lives at work. Although there are many couples who met at work and lived happily ever after, there are also many whose dreams of an office romance turned into an office nightmare.
Many employers may be unaware of personal relationships between their employees, may turn a blind eye to them, or may even condone them. Notwithstanding an employer’s views on office romances, there are a number of reasons why an employer should keep a blossoming inter-company romance on their radar.
Employers may expose themselves to potential claims for sexual harassment, discrimination, unfair dismissal and a myriad of other claims in the event an office romance turns sour. This is particularly the case where one member of the couple is in a position to exert power over the other.
Managers and other senior employees generally owe fiduciary duties to their employer which includes an obligation to avoid conflicts of interest. Romantic relationships that develop in the workplace may give rise to a potential for conflicts of interest and for questions to be raised about whether the employees involved are in breach of their fiduciary duties. This will most commonly occur where a senior manager forms a romantic relationship with a direct subordinate. However, the lines are blurred when it comes to romances between co-workers, relationships between employees who work in different departments or once-off flings which occur outside of the workplace and out of business hours.
What happens when a relationship gets rocky?
Relationship breakdowns can be messy at the best of times – let alone when you are hot-desking with your ex. Whilst an employer should be careful not to take sides following a relationship breakdown between two staff members, caution is required to ensure personal grievances do not become a business’ dirty laundry.
One of the primary legal risks associated with relationships that develop in the workplace is sexual harassment. Whilst the laws and precise definition of sexual harassment differ between the various Australian Federal, State and Territory jurisdictions, it is essentially unwelcome conduct of a sexual nature that a reasonable person anticipates would cause a victim to feel offended, humiliated or intimidated.
Other legal risks that may arise in connection with an office romance may include:
- Sexual discrimination claims for treating one participant in the relationship differently to the other on the basis of their sex;
- General protections claims under the Fair Work Act 2009 (Cth) in respect of discrimination or where an employee has made a complaint concerning unwanted conduct in the workplace;
- Workers compensation claims arising from sexual harassment in the workplace;
- Unfair dismissal claims where an employee’s employment is terminated in circumstances where the employer does not have a valid reason or the employee is not afforded procedural fairness;
- Criminal offences and/or domestic violence or personal intervention orders arising from (for example) sexual assault, stalking or indecent exposure; and
- An employer breaching its work health and safety duties to maintain a safe working environment.
Notwithstanding these risks, employers do not have an ability to regulate the conduct of their employees if it does not have a sufficient connection to the workplace. As such, a consensual workplace relationship of itself will very rarely be grounds for dismissal.
Further, an employer is also not necessarily in a position to pass judgment (by terminating an employee’s employment) on the basis of an extramarital affair or any other relationships it may consider inappropriate. An employer must ensure that it does not discriminate in the workplace based on an employee’s marital or relationship status, otherwise the employee may be able to successfully bring a general protections claim against the employer.
How can an employer protect itself from being unlucky in love ?
Before the sparks of an office romance start to fly, employers should consider undertaking the following actions:
- Implementing policies and codes of conduct which regulate inappropriate unlawful workplace behaviours, such as sexual harassment, discrimination and bullying;
- Ensuring all staff are trained in, and aware of, their responsibilities and duties in relation to appropriate workplace behaviours and conduct;
- Including express terms in contracts of employment that require employees to act honestly and reasonably, promote the interests of their employer, avoid conflicts of interest and disclose any actual or apparent conflicts of interest; and
- Appointing sexual harassment or discrimination officers, to whom employees can disclose issues arising out of personal relationships in the workplace.
If an employer is confronted with the difficult task of dealing with the breakdown of a relationship in the workplace, it should seek legal advice to determine the best course of action in the circumstances.
If a complaint has been made by one participant in a relationship about the conduct of the other, it will be important to ensure a procedurally fair investigation is undertaken into the allegations and both participants are offered an opportunity to provide their version of events. Next steps (depending on whether or not any wrongdoing has been substantiated) may include counselling, performance management, offering one member of the relationship a transfer, or (in the most extreme circumstances) disciplinary action up to termination of employment.
A lesson in love
Employers should heed the warning that high profile cases provide about the dangers of workplace romances and not put their heads in the sand and think that their workplace is exempt from an office bust up.
This article was written by Clare Raimondo, Partner and Jessica Nicholls, Senior Associate.