17 October 2024
5 min read
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On 1 October 2024, the Australian Human Rights Commission Amendment (Costs Protection) Act 2024 (the Act) amends both the Australian Human Rights Commission Act 1986 (AHRC Act) (and, consequentially, the Federal Circuit and Family Court of Australia Act 2021 (FCFCA Act) and the Federal Court of Australia Act 1976 (FCA Act)) following findings from a national inquiry into workplace sexual harassment.
Among the most notable amendments is the introduction of equal access cost provisions into the AHRC Act. These provisions allow applicants, who may have been deterred by the risk of costs orders, to pursue unlawful discrimination claims beyond the Australian Human Rights Commission (Commission) and into the Federal Court.
No only do the changes expand victim-surivivors’ access to justice, but it also places pressure on respondents to take more proactive steps in mitigating the risk of a discrimination complaint being pursued against them beyond the Commission.
The Commission is a ‘no-costs’ jurisdiction, meaning it has no power to award costs against an applicant or respondent for unlawful discrimination claims pursued in that forum, a fact which remains unchanged despite the introduction of the Act.
If an applicant is unable to resolve a dispute in the Commission, they can apply for the matter to be heard in the Federal Court and, if appropriate, on appeal to the High Court. Prior to the introduction of the Act, the FCFCA Act and FCA Act granted a discretionary power on justices to award costs against parties in these proceedings. Costs orders could take into account settlement offers made (but not accepted) between the parties during the Commission proceedings.
Put simply, this meant that applicants who pursued an unlawful discrimination complaint beyond the Commission could have costs awarded against them at the court’s discretion.
The Act flowed from the Respect@Work Report (the Report) released by the Commission in 2020 following a national inquiry into the prevalence and prevention of workplace sexual harassment in Australia. The inquiry found that the risk of being ordered to pay another party’s costs could deter victim-survivors of sexual harassment and other forms of discrimination from commencing legal proceedings. To rectify this, it recommended (amongst 54 other things) that the AHRC Act be amended to include a cost protection provision consistent with section 570 of the Fair Work Act 2009 (FW Act). That provision provides that costs may only be ordered against a party if the court is satisfied:
The new section 46PSA of the AHRC Act reaches beyond the Commission’s recommendation, modifying the equal access model to “strike the appropriate balance between alleviating barriers to accessing justice for applicants in anti-discrimination proceedings and the burden on respondents”.
The new provision provides that where the court deviates from the default position (being that parties bear their own costs), it can order the applicant to pay the respondents’ costs if one of the following applies:
In assessing whether the respondent does not have a significant power advantage over the applicant, the Explanatory Memorandum to the Bill provides that consideration should extend beyond financial resources. Factors such as unequal power relations, social and cultural power imbalances, organisational power imbalances, hierarchical workplace culture or industry and conditions of employment should be taken into account. This reflects the view that the resource and power disparities between applicants and respondents in unlawful discrimination matters are not only financial but also structural.
The Explanatory Memorandum also provides that, in cases where the respondent does not have a significant power advantage, the legislative intention of weighing the respondent’s financial resources is to reduce the burden on successful respondents that are not well-resourced and do not hold a power advantage over the applicant. If a respondent seeks to rely on this provision, they would need to provide evidence of their financial position to the court.
The Act also imposes an obligation on courts to make a costs order against a respondent where an applicant is successful on one or more grounds, demonstrating a shift away from a discretionary power and encouraging parties to settle matters in the Commission. However, a court can avoid this requirement if it is satisfied that the applicant’s unreasonable act or omission caused the respondent to incur costs.
In respect of representative applications, the Act provides that a court can make a costs order against the representative body and not the individuals on whose behalf the application is made. This amendment means that in making the representative application, the representative body is accepting the risks associated with pursuing discrimination complaints in court. No costs order can be made against the persons on whose behalf the application is made in their individual capacities.
The Explanatory Memorandum to the Bill provides a helpful diagram explaining how the new cost provisions apply. It can be found here.
If you have any questions regarding these changes to the AHRC Act, please get in touch with a member of our team below.
Disclaimer
The information in this article is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this article is accurate at the date it is received or that it will continue to be accurate in the future.
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