Cosmetics distributor Heat Group has won a three-year battle with a former employee who claimed to have been discriminated against and harassed, and has urged other entrepreneurs facing “spurious claims” not to be afraid to fight to protect their reputation.
Former Heat Group sales manager Jo-Anne Finch launched a $500,000 legal claim against Heat Group, founder Gillian Franklin and three male Heat executives after claiming she had been sexually discriminated against and harassed.
Finch claimed she had worked longer hours than other staff, said she had been passed over for promotion in front of similarly qualified male staff and claimed male staff had been given gift packs from suppliers while she had not.
She also claimed she had been harassed by Heat Group executives while on sick leave.
The case, heard in the Victorian Civil and Administrative Tribunal, ran for 22 days.
Yesterday, Judge Marilyn Harbison dismissed all of Finch’s claims.
In her 142-page ruling, Judge Harbison said she was “positively satisfied that many of the Complainant’s claims of discrimination, harassment and victimisation are not just unproven but clearly false.”
“I am satisfied that many of the allegations were made without concern about whether or not they were true.”
“It is my firm view that none of the allegations which have been made against any of the respondents have been established to the requisite degree of satisfaction.”
A clearly relieved Franklin, who earlier this year featured on SmartCompany’s top female entrepreneur list, denied the claims throughout the case.
She says the long and bitter legal battle has cost more than $300,000 in legal fees as well as hours of time, but says she felt Heat Group had no choice but to fight the case given most of Heat Group’s staff and customers are female.
“These claims struck at the heart of our values and corporate reputation,” she says. “The Heat Group is a recognised leader in workplace relations and a strong advocate of the rights of women.”
Franklin also says the case should be a lesson for other entrepreneurs who are often tempted to settle when confronted with similar allegations from staff.
However, Franklin says business owners must be prepared to fight to clear their own names and the name of staff who might be hit with “baseless allegations”.
It is a sentiment Judge Harbison appeared to support in the judgement.
“The social purpose of discrimination law is not advanced by the making of spurious claims. This jurisdiction should not be used to pursue such unmeritorious claims.”
Franklin says one of the big lessons she learned from the trial was the importance of documenting all employee relations matters.
“I learnt so much about the importance of having rich written communications such as performance reviews, and having good, robust policies in place that are checked regularly so they comply corporate governance.”
“We had all of that in place and it helped us win the case because we had written proof. It also gave us the confidence to fight the case because we could prove what we said.”
SmartCompany sought comment from Finch’s solicitor Holding Redlich but none was received prior to publication.
To read more about the lessons from Gillian Franklin’s fight, click here.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
