“It was just banter.”
Four words that can create a very big problem for an employer.
I am not suggesting that we need to remove humour from the workplace.
People joke. People swear. People give each other a hard time. Some workplaces are more direct, informal and colourful than others.
But what happens when an employee joins in?
What happens when they have previously participated in sexualised conversations or jokes?
Does that give others greater licence to make sexual comments towards them?
And can an employer defend a sexual harassment allegation by saying:
“That was just the culture of the workplace”?
A Federal Court decision provides some important answers.
And for employers with workplaces where “banter” is part of the culture, it is worth noting as a good guide.
The case: Clarke v Beiler Constructions
In Clarke v Beiler Constructions Pty Ltd as trustee for Fox Trading Trust [2026] FCA 734, the Federal Court considered claims arising from the employment of an adult apprentice carpenter who worked on a FIFO basis on Kangaroo Island and at other sites around Adelaide.
The employee commenced employment in March 2023 and subsequently alleged a number of incidents of sexual harassment, as well as sex discrimination, adverse action and various employment entitlement contraventions.
Importantly, the Court did not accept every allegation made by the employee.
Ultimately, two instances of sexual harassment were established on the balance of probabilities. The employer was also held vicariously liable for the sexual harassment committed by the supervisor.
This was not simply a case where every allegation made by an employee was accepted.
The Court had to work through conflicting evidence, assess credibility and determine what was more likely than not to have occurred.
It was in practical terms, “he said, she said”.
One allegation provides a particularly useful lesson for employers.
No witnesses. A complete denial. What happens next?
One of the incidents involved an allegation that a senior supervisor directly asked the employee for a sexual act while they were walking to the mess hall.
According to the employee, when she did not respond, the supervisor made a further comment suggesting that what occurred on the island would remain there.
Nobody else was present.
The supervisor denied the allegation.
At first glance, an employer might look at a situation like this and think:
“There are no witnesses. How are we ever going to work out what happened?”
That is one of the traps in dealing with workplace complaints.
Sexual harassment does not always occur in front of an audience.
Bullying, harassment and other serious workplace conduct can happen in private conversations, behind closed doors, over the phone, on a work trip or simply when two employees happen to be alone.
The absence of a direct witness does not necessarily mean an allegation cannot be substantiated.
Clarke is a good example of why.
What happened afterwards mattered
The Court looked beyond the immediate interaction between the employee and supervisor.
The employee had spoken to members of her family about what had happened shortly after returning from Kangaroo Island.
Her adult son gave evidence supporting her account that she had told him about the proposition.
Her parents also gave evidence that she had told them a man she worked with had propositioned her.
The consistency of those accounts was relevant when the Court assessed the reliability of the employee’s evidence.
After considering the evidence, the Court was satisfied on the balance of probabilities that the supervisor had made the request.
But what about the banter?
This is where the decision becomes particularly interesting.
There was evidence of joking and banter within the workplace, including sexualised banter.
The employee herself had participated in workplace banter.
However that did not give everybody around her an unlimited licence to say whatever they wanted.
The Court found that directly asking someone for a sexual act constituted a sexual advance and a request for sexual favours.
That difference is integral.
An employee can participate in jokes at work and still be sexually harassed.
An employee can swear.
They can laugh at inappropriate jokes.
They can participate in conversations that others might consider crude.
None of those things necessarily means that every subsequent sexual comment, proposition or request directed towards that employee is welcome.
That creates a potential problem for workplaces with a strong “banter culture”.
So when a complaint eventually arises, one of the immediate responses can be:
“But they were part of it.”
Or:
“They used to joke about this stuff too.”
Or perhaps the most dangerous:
“That is just how we talk around here.”
Those things may form part of the factual context.
But they are not necessarily an answer to the allegation.
Workplace culture is not a free pass
There is nothing inherently wrong with a workplace having personality.
I don’t think the lesson from Clarke is that every workplace needs to become completely sanitised.
Strong workplace relationships often involve humour especially in countries such as Australia.
But there is a significant difference between allowing employees to have a joke and allowing “banter” to become an excuse for inappropriate conduct.
This is particularly important where there are significant differences in seniority or authority.
In Clarke, the relevant allegation involved an apprentice and a senior supervisor.
Employers should think carefully about those dynamics.
What a manager regards as harmless joking may not be experienced in the same way by a junior employee.
An employee may laugh because they feel uncomfortable.
They may say nothing because of the position held by the person making the comment.
They may decide not to challenge someone in front of their colleagues.
They may only speak about it later.
That is why pointing to the historical culture of the workplace can be dangerous.
Culture does not determine where the legal boundary sits.
The employer’s problem did not end with the supervisor
Another significant part of the decision is what happened to the employer.
The Court held that the employer was vicariously liable under section 527E of the Fair Work Act 2009 (Cth) for the sexual harassment committed by the supervisor.
That moves this case beyond being simply a warning to employees about inappropriate comments.
It becomes an organisational risk issue.
And that means it should be of interest not only to HR.
CEOs, CFO’s executives, Boards, business owners and senior managers should be asking what their organisation is actually doing to prevent sexual harassment.
There is a significant difference between having a sexual harassment policy and having an effective sexual harassment prevention framework.
Is having a policy enough?
Most established businesses will have some form of policy dealing with sexual harassment.
That is a good starting point.
But what happens after the policy is drafted?
Does anybody read it?
Do employees receive training?
Do supervisors understand their responsibilities?
Do managers know what to do when they hear an inappropriate comment?
Do employees know where they can report something?
What happens when someone raises an issue informally?
And perhaps most importantly:
Can the employer demonstrate what it has actually done?
Clear policies, regular and decent training, accessible reporting mechanisms and proper investigation processes are all important.
Practical implementation matters a whole lot more.
A policy sitting on an intranet does not, by itself, change workplace behaviour.
Supervisors can make or break the culture
There is another reason employers should pay attention to Clarke.
The conduct in question involved a supervisor.
Supervisors occupy an important position in workplace culture because they are often the people who determine what behaviour is tolerated on the ground.
Employees watch what managers do.
More importantly, they watch what managers allow.
You can have an excellent policy drafted by HR and approved by the executive team.
But if supervisors participate in inappropriate conversations, ignore sexual comments or dismiss concerns as “banter”, employees receive a very different message about the actual standard within the organisation.
That is why sexual harassment training cannot simply be a compliance exercise.
Managers need to understand what they are expected to do when behaviour starts moving in the wrong direction.
Sometimes the best intervention happens long before there is a formal complaint.
A manager sees the behaviour.
They address it.
They reset expectations.
And they stop a relatively small problem from becoming a much larger one.
What should employers be asking?
Following Clarke, I think there are some fairly simple questions worth asking:
- When was the last time our employees received sexual harassment training?
- Have our leaders, supervisors and managers been properly trained on some of the more particular proactive legal obligations on sexual harassment?
- Do employees know how and where to raise concerns?
- Do our managers understand that “banter” is not an automatic answer to inappropriate behaviour?
- Can we demonstrate the practical steps our organisation has taken to prevent sexual harassment?
If the answer to some of those questions is “I’m not sure”, that in itself tells you something.
The bigger lesson from Clarke
The interesting thing about Clarke is that it challenges a very human response to workplace complaints.
We like clear categories.
Appropriate or inappropriate.
Welcome or unwelcome.
Banter or harassment.
In practical terms, real workplaces are rarely that simple.
An employee can enjoy crude humour and still have boundaries.
They can participate in workplace banter and still object when something becomes personal.
They can fail to object immediately and still raise a complaint later.
And an allegation can potentially be substantiated even where nobody else directly witnessed what occurred.
For employers, that means workplace culture needs boundaries.
More importantly, those boundaries need to be understood before something goes wrong.
You do not need to remove humour from the workplace.
You do need to know where the boundaries are.
And more importantly, your people need to know where they are too.
Need Assistance?
South Geldard Lawyers regularly assists employers, HR teams and executives with:
- Sexual harassment prevention frameworks
- Respect@Work compliance reviews
- Workplace investigations
- Psychosocial hazard management
- Manager and leadership training
- Employment law and workplace safety audits
Get in touch now for an obligation free discussion on your organisation’s current approach to preventing workplace sexual harassment via jmamaril@southgeldard.com.au or 07 4936 9100.
