By Kate Lahey
TODAY should have been a good one for David Jones. It is due to unveil its spring-summer fashion collection in a glamorous catwalk affair. Instead, the retailer is reeling from the launch of a $37 million lawsuit, brought against it by one of its employees.
Kristy Fraser-Kirk, a publicity co-ordinator (pictured), has taken the unusual step of seeking punitive damages for sexual harassment, asking for 5 per cent of the $700 million in profits David Jones made between 2003 and 2010 when Mark McInnes was chief executive and another $2 million from Mr McInnes, 5 per cent of his salary.
''If the court does decide to award punitive damages, all of that money will go to a charity to help those affected by sexual misconduct at work,'' Ms Fraser-Kirk said.
Mr McInnes's contract was ''mutually terminated'' on June 18. He received a $2 million payout and was immediately replaced by Paul Zahra.
Mr Zahra and David Jones's eight other directors are named as respondents in the case.
The lodgement of the claim in the Federal Court in Sydney yesterday came as a shock to the company, as did the amount. It is believed negotiations with Ms Fraser-Kirk's lawyers were still taking place until recently.
Ms Fraser-Kirk said yesterday she tried her best to have the matter resolved fairly.
Despite the action, David Jones, which in 2008-09 posted a record $156.5 million profit, yesterday confirmed that it expected its profits to grow by between 5 and 10 per cent for 2009-10. It also expects to achieve another 5 to 10 per cent growth in 2010-11 ''based on all the information available to it''.
The company was silent on the results of a recent independent review of its code of ethics and conduct, or changes it may make.
The statement of claim alleges four other employees were the victims of serious sexual misconduct by Mr McInnes, and that the company was aware of three of them.
In a statement yesterday, Ms Fraser-Kirk offered a toll-free phone number for other David Jones employees who might want to talk to her legal team at Harmers Workplace Lawyers.
''This is not just about me,'' she said.
Harmers said yesterday it was running the case free.
''This is an important matter being run pro bono by Harmers in the public interest,'' a statement by the law firm said.
Ms Fraser-Kirk said she had high hopes for her career with the retailer.
David Jones declined to comment yesterday, beyond its statement that said the company and its directors would vigorously defend the allegations.
BusinessDay was unable to contact Mr McInnes's representative.