The David Jones case shows middle managers need to be better trained: Kohler

Every corporate middle manager should read Kristy Fraser-Kirk’s statement of claim against David Jones as a guide to how not to react when you’re caught between your boss’s rampant libido and a staff member.

In some ways the shocking punitive damages claimed by Fraser-Kirk and her lawyer, Harmer’s, for 5% of DJ’s profits while Mark McInnes was CEO ($35 million) and another 5% of McInnes’ salary ($2 million) are a distraction from the substance of this case.

That substance is not only about the behaviour of McInnes, but also that of the managers standing between him and his target.

Those three people are also the victims in this affair because they don’t appear to have had clear guidelines on how they should react. They were the board’s front-line troops in this affair and they let the company down, but if they hadn’t been told what to do when the boss gropes a staff member then they have been let down as well.

According to Fraser-Kirk’s statement of claim, the problems began on May 23 this year when, at a lunch, and in full view of everyone else, McInnes suggested she try a dessert because it’s “like a f*** in the mouth”, then put his hand under her clothes, invited her to his apartment in Bondi and gave her a hug while repeating the invitation.

According to the statement, her immediate supervisor Tahli Koch, and the PR General Manager, Anne-Maree Kelly, both saw what happened, and when Fraser-Kirk made an official report to them, they confirmed that.

It’s alleged Kelly told Fraser-Kirk: “Next time that happens, just say no to Mark and he’ll back off”.

Fraser-Kirk alleges that over the next four days McInnes sent her a series of emails, repeating the invitation to Bondi.

On June 7, Fraser-Kirk had to go to another function where Mark McInnes was present. He took up where he left off, according to the statement, inviting her to Bondi, trying to kiss her and then once again putting his hand under her clothes.

The next day he rang her up and allegedly said: “I could have had guaranteed sex with that brunette last night but I wanted you” and then followed up with a text message.

The day after that, Fraser-Kirk allegedly reported the matter to her boss, Anne-Maree Kelly, who, according to the statement, said other employees had been harassed by McInnes in the past, and said she would speak to her boss, Damian Eales, group general manager – financial services and marketing.

According to the statement, Fraser-Kirk then met with Eales and Kelly and they told her to go home. There was talk of a meeting with McInnes, which suggests that Eales had spoken to the CEO. That night Fraser-Kirk got a text message from McInnes saying “I want you to have a fantastic career at David Jones”.

The next day she went to Harmers and then she and DJs began communicating through lawyers. On June 11, DJs lawyers told her lawyers that McInnes had been instructed to make no further contact with Fraser-Kirk, but on June 14 there allegedly were two voicemails and five text messages, starting at 8.08am and finishing at 8.30pm.

Four days after that McInnes was gone – and was paid a settlement of $1.5 million.

Clearly, McInnes deserved the sack and probably shouldn’t have got any money at all. Whether the directors also behaved badly in the situation depends on what they knew and when they knew it; it is possibly that none of them knew McInnes was not apparently fully in control of his libido, if I can put it that way, but it doesn’t sound likely.

More interesting, in my view, were the alleged actions of Damian Eales, Anne-Maree Kelly and Tahli Koch, and the board’s responsibility to protect them, not just Kristy Fraser-Kirk.

It seems that they had an out-of-control CEO who, according to the statement of claim, has a history of bullying, and they have a staffer complaining about harassment. What to do?

The answer is: it must go straight to the person’s superior, whoever it is – in this case the chairman. To protect middle manager caught in the middle this must be clearly set out as company policy, so there is no choice in the matter: every sexual harassment complaint must be elevated immediately to the alleged harasser’s superior.

That is not to pre-judge the matter, but to protect the manager to whom the complaint has been made. Clearly, Eales should have gone to Bob Savage on June 10, not McInnes, and there should have been a company policy in place that instructed him to do that.

Earlier than that, Anne-Maree Kelly should have told Eales about it on May 24, and it should have been elevated to Savage then.

Whether Kristy Fraser-Kirk’s nominated charity gets a big lump of money from David Jones or not, this case should set the standard for a board’s responsibility to provide clear guidance for middle managers.

This article first appeared on Business Spectator.