Briefing

Australia’s latest workplace sexual harassment reforms explained

Several years on from the landmark Respect@Work reforms which introduced the positive duty to eliminate sexual harassment and other forms of sex discrimination, legislators, courts and anti-discrimination bodies continue to respond to the scourge of workplace sexual harassment and there appears to be no signs of losing momentum.

The figures on the number of sexual harassment complaints show that 2025 was a record year as the number of complaints continues to climb. In this article, we set out some developments in this space that employers should be monitoring throughout 2026.

Victorian NDA restrictions

In November 2025, the Victorian government passed the Restricting Non-disclosure Agreements (Sexual Harassment at Work) Act 2025 which places restrictions on the use of non-disclosure agreements (NDAs) in workplace sexual harassment cases. The changes will commence by proclamation, most likely on 1 July 2026 and employers with Victorian operations should be preparing for their introduction.

These legislative changes came about after an inquiry was conducted by the Victorian Government, which recommended further reforms in response to concerns that NDAs are being misused to promote a culture of secrecy by silencing victims of workplace sexual harassment, protecting the reputation of employers, avoiding full liability for workplace sexual harassment and by concealing serial offenders.

What do employers need to know about the new laws?

NDAs require one or both parties to the agreement to keep certain matters confidential. In workplace sexual harassment disputes, NDAs may be used to resolve allegations without the need for litigation, with the employer paying a settlement sum to a complainant in exchange for the complainant not disclosing any allegations of sexual harassment, the identity of the alleged sexual harasser and the terms of settlement.

The Victorian legislation still permits the use of NDAs as an option to settle workplace sexual harassment cases but places the following restrictions on their use:

NDAs must be requested by the complainant, and it must be the complainant’s express wish and preference to enter into an agreement;
employers must provide a mandatory ‘workplace non disclosure agreement information statement’ to the complainant before entering into an NDA (yet to be published);
before entering into an NDA, the complainant has a period of 21 days to review the agreement, obtain legal advice and decide if they wish to enter into an NDA (which may be reduced or waived altogether);
before entering into an agreement, all parties to the agreement must acknowledge the above points;
the employer, the respondent, and the representative of the employer or the respondent cannot exert undue influence or undue pressure on the complainant as to their decision on whether or not to enter into an agreement;
NDAs cannot prevent parties from disclosing material information about workplace sexual harassment to certain persons (including lawyers, police, religious ministers, or a friend or family member who has agreed to keep the information confidential), and bodies such as the Australian Human Rights Commission; and
complainants may terminate an NDA after it has been in operation for one year.

If these conditions are not met, the NDA will not be enforceable against a complainant to the extent it prevents a complainant from disclosing material information about workplace sexual harassment.

Landmark damages in workplace sexual harassment case

Courts have also been responding to workplace sexual harassment by continuing the upwards trend of the amount of damages being awarded to successful complainants.

For example, in 2019, an employee who was subjected to sexual harassment by her manager was awarded $120,000 in general damages,¹ and later in 2023, an employee who experienced similar conduct by her manager was awarded $140,000 in general damages.²

In August 2025, the Federal Court of Australia in Magar v Khan [2025] FCA 874 awarded record-breaking damages of $160,000 to a complainant at a Mad Mex franchise who was sexually harassed and victimised by her manager.

In that case, the court reinforced the importance of an employer’s responsibility to create a respectful workplace culture. The court found that the manager created and fostered a hostile workplace environment that ‘tolerated overt and outspoken sexist and boorish behaviour‘ and that normalising such behaviour can escalate into sexual harassment.

Notably, the court provided insight into the types of conduct that could be characterised as ‘harassment on the ground of sex’ under s 28AA of the Sex Discrimination Act 1984 (Cth). The court considered circumstances in which the manager and other senior employees made sexual comments about other female employees and customers of the store and whether this amounted to ‘harassment on the ground of sex’. However, the court ultimately found that this conduct could not be characterised as ‘harassment on the ground of sex’ in relation to the complainant, because the conduct did not occur ‘in relation’ to the complainant (i.e. it was not about, or directed at, the complainant).

Key takeaways

In our experience, most employers understand the importance of preventing sexual harassment and other forms of sex discrimination and are committed to discharging their positive duty to do so. However, the damages awarded in Magar v Khan shows the pitfalls of getting it wrong. Employers should intervene early in known problematic workplace behaviours and lower-level conduct such as sexist ‘banter’, as this type of conduct creates conditions for sexual harassment to occur (rather than waiting to receive complaints from employees about such matters).

Diligent employers will have developed and implemented a comprehensive sexual harassment management plan, reviewed their workplace policies, deliver regular and meaningful training on sexual harassment, provide clear reporting channels for complainants and continuously monitor and review whether current measures are effective to eliminate, as far as possible, sexual harassment in the workplace. We are increasingly seeing these measures being seen as a bare minimum.

The Victorian NDA reforms have the potential to disrupt the way employers deal with settling sexual harassment claims and, whilst confined to Victoria at this stage, may have flow on effects outside of that jurisdiction.

Footnotes