Workplace Bullying & Harassment: Employer Obligations & Compliance Guide 2026

Since December 2024, Australian employers face a transformed legal framework for workplace bullying and harassment. The Fair Work Commission gained new powers to issue “stop bullying orders,” penalties for individuals reached $19,800, and corporate breaches now carry $99,000 penalties. Yet many employers still don’t know what they’re legally obligated to do — or what happens when they fail.

WHO, WHAT, WHEN, WHERE, WHY, HOW: The Essential Context

• WHO: All Australian employers under the Fair Work Act 2009, state workplace health & safety laws, and common law duty of care.
• WHAT: Prevent, identify, and resolve workplace bullying (repeated, unreasonable conduct that creates a risk to health and safety).
• WHEN: From 12 Dec 2024 onwards; stop bullying orders are now enforceable by the FWC.
• WHERE: Applies to all Australian workplaces, including on-site, remote, and hybrid arrangements.
• WHY: Legal liability, psychological injury claims, FWC orders, reputational damage, and employee turnover.
• HOW: Document policies, train managers, investigate promptly, follow procedural fairness, and respond to FWC applications.

Your Legal Obligation as an Employer

You have three core duties:

1. Duty of Care — Common law and workplace health & safety laws require you to eliminate or minimize the risk of bullying causing psychological injury.
2. Fair Work Act Compliance — You must not take adverse action because an employee has raised a bullying complaint (general protections breach).
3. Stop Bullying Order Compliance — If the FWC issues an order, you must comply or face penalties up to $99,000.

What Counts as Workplace Bullying?

The Fair Work Act defines bullying as repeated, unreasonable conduct directed toward a worker that creates a risk to health and safety — physical, psychological, or both.

• Persistent public criticism or humiliation, or exclusion from meetings and events as punishment.
• Overloading one person’s workload while peers do less, or threatening shift/role changes to force compliance.
• Aggressive messages or outbursts directed at one person, or setting impossible deadlines to engineer failure.

Your Preventative Obligations

1. Anti-Bullying Policy — A written policy defining bullying, reporting channels, a no-retaliation promise, and investigation steps.
2. Manager Training — Equip supervisors to recognize and respond to bullying without creating risk themselves.
3. Accessible Reporting — Multiple confidential channels (HR, hotline, external advisor) — never force employees to report to their bully.

Responding to a Bullying Complaint

When an employee reports bullying, follow this 8-step process:

1. Take it Seriously & Document — Treat as urgent and record the complaint in writing (date, names, description, witnesses).
2. Separate Parties if Needed — If risk is immediate, temporarily move the alleged bully or complainant while investigating.
3. Investigate Promptly — Within 7–10 days, interview all parties separately with procedural fairness — give the alleged bully a fair chance to respond.
4. Document Findings & Act — Record recommendations and any actions taken (retraining, disciplinary, reconciliation).
5. Close the Loop — Update both parties on the outcome within confidentiality limits and offer support (counseling, monitoring).
6. No Retaliation — Never demote, isolate, or disadvantage the complainant — that’s a general protections breach.

The Stop Bullying Order — What It Means

If an employee applies to the FWC for a “stop bullying order” under section 789FF of the Fair Work Act:

• The FWC can order you to stop the conduct, apologize, pay compensation, reinstate the employee, or refer to counseling.
• You’re legally bound to comply. Breaching an order carries penalties up to $99,000 for organizations, $19,800 for individuals.
• The burden is on you to prove the conduct wasn’t bullying or didn’t create a risk to health and safety.

Most orders combine immediate cessation of the conduct, a positive obligation to prevent recurrence (retraining, monitoring, role separation), and compensation for lost wages, injury or distress — typically $2,000–$20,000 depending on severity.

Disciplinary & Termination Steps

If investigation confirms bullying:

• First breach: Formal warning, retraining, role change, or supervised improvement plan (30–60 days).
• Repeated breach: Suspension (1–5 days paid) + final warning.
• Serious breach (e.g., harassment with discriminatory intent): Dismissal.

Common Employer Mistakes

1. Ignoring informal complaints — “Just talk it out” doesn’t shield you legally. Formalize and document.
2. Blaming the complainant — “You’re too sensitive” is not a defense and may worsen liability.
3. No investigation — Skipping investigation and siding with the manager exposes you to FWC claims.
4. Retaliating against the complainant — Demoting, isolating, or giving them poor shifts = general protections breach.
5. Failing to separate parties during investigation — Keeping them in contact risks further harm and taints your investigation.
6. Covering it up — Hoping it goes away never works. FWC will find out, and secrecy damages your defense.

Workplace Health & Safety Angle

Bullying is a WHS hazard. Your WHS obligations require you to:

• Identify bullying as a risk in your risk register.
• Assess the level of risk (low, medium, high) based on frequency, severity, and vulnerability of affected staff.
• Implement controls (policy, training, reporting channels, investigation process).
• Monitor effectiveness (staff surveys, complaint tracking, incident review).
• Adjust if risks are not adequately controlled.

Cost of Non-Compliance

• FWC stop bullying order: $2,000–$20,000 compensation to employee.
• FWC penalty for non-compliance: Up to $99,000 per breach.
• Psychological injury claim: $50,000–$500,000+ in damages + legal costs + workers’ comp.
• Reputational damage: Lost recruitment talent, media coverage, client concerns.
• Staff turnover: Bullying culture drives resignations (15–20% annual turnover risk).

One serious case can cost $150,000–$500,000 in direct and indirect costs.

Practical Compliance Checklist

• [ ] Anti-bullying policy in place, reviewed, and communicated to all staff?
• [ ] Managers trained on bullying recognition and response?
• [ ] Confidential, multi-channel reporting process documented?
• [ ] Clear process for investigation (timelines, documentation, fairness)?
• [ ] Zero-retaliation clause in writing and visible to all?
• [ ] Separate investigation channel for complaints about the managing director/owner?
• [ ] WHS risk register updated to include bullying?
• [ ] Incident log maintained (date, names, brief description, outcome, follow-up)?
• [ ] Disciplinary framework (progressive discipline steps) documented?
• [ ] Counseling or EAP support offered to affected employees?
• [ ] Annual review of incidents and policy effectiveness?

When to Seek Legal Advice

Get employment law advice if:

• An employee has filed an FWC application for a stop bullying order.
• You’re investigating a serious allegation (harassment, discrimination, violence).
• You’re uncertain whether conduct meets the “bullying” threshold.
• You’re planning to terminate someone on bullying grounds.
• A complainant is threatening to escalate to regulators or media.

Key Takeaway

Workplace bullying is no longer a grey area. The FWC has teeth, penalties are real, and employers who ignore complaints or retaliate face serious liability. Your legal duty is clear: identify the risk, have a process, investigate promptly, act fairly, and never retaliate.

Build a culture where bullying doesn’t fester. That’s both a legal win and good business.