Fraser-Kirk Vs David Jones and Mark McInnes – sexual harassment case

18/6/2010 David Jones CEO Mark McInnes offered his resignation and admitted to behaving “in a manner unbecoming of a Chief Executive to a female staff member.” The scandal has continued to affect the reputation of all parties involved and has remained in the media spotlight since the resignation. Kristy Fraser-Kirk filed legal proceedings on august 2, 2010 against Mr McInnes and the company’s directors.

In Federal Court in Sydney, revelations that 8 more women have come forward with allegations against Mr McInnes deepens the scandal and its reputational impacts. Ms Fraser-Kirk is seeking compensation for breach of contract, loss and damages and punitive damages. David Jones is defending the claims.

What will be the long term effects of this scandal on the business of David Jones regardless of which way the case leads? Will it cripple the organisation? Probably not, but there is the risk that if found or settled in Ms Fraser-Kirks favour, it may have flow on impacts to the business. David Jones target market is women. The majority of its employees are women. A result which finds that management have fostered an environment where harassment is not addressed appropriately could be damaging.

You don’t have to be big and powerful, you just have to overstep the mark. Many people (both women and men) have been unnecessarily bullied, harassed, discriminated against or treated unfairly in the workplace.

The extraordinary damages claim has drawn unwanted attention to David Jones and interest in the outcome is high. Are the dollar amounts of the claim excessive? Perhaps. Is the outcome important? Extremely, not only for David Jones and Ms Fraser-Kirk but this action sends a definitive message. No matter how big or important you are harassment of any kind is not acceptable and consequences will be forthcoming.

Could your business withstand a scandal such as this? What else can David Jones do to salvage their reputation? A starting point would be to revisit their equity and diversity policy, implement training on the same and create a zero-tolerance environment toward harassment.