She settled her harassment claim for $30k, then the Supreme Court made her pay
A sexual harassment settlement meant to close the door, but one phrase opened it again four years later, with catastrophic results for the employee.
The Queensland Supreme Court ruled on December 23, 2025 that Hamde Bakhit must pay her former employer's legal costs after trying to sue over claims she'd already released in a 2017 settlement deed. The decision exposes a trap many HR teams miss: the difference between statutory compensation that cannot be released and common law claims that can.
Bakhit worked for corporate law firm Hartley Healy across two stints between 2013 and 2016. She alleged a solicitor sexually harassed her from December 2015 through April 2016.
After withdrawing a WorkCover claim in October 2016, she filed a complaint with the Australian Human Rights Commission. At an April 2017 conciliation conference, the parties reached a settlement. The firm paid thirty thousand dollars, converted her termination to a resignation, provided a reference, and expressed regret.
The settlement deed released the firm from all claims "other than any claim for statutory benefits under the Workers' Compensation and Rehabilitation Act 2003 (Qld) or for unpaid superannuation which she may be entitled to make."
That's where things went wrong.
In 2021, Bakhit sued Hartley Healy for breach of duty of care and breach of contract over the same harassment allegations. Her lawyers argued that since the workers compensation act controls who can sue employers and how damages get calculated, the claims themselves were statutory benefits falling within the settlement's exception.
Justice Sullivan rejected that reasoning completely. The workers compensation act draws a sharp line between two things, he found.
Compensation means amounts payable under chapters 3, 4 and 4A by an insurer—the no-fault weekly payments, medical expenses, and lump sums the statute creates.
Damages means something different: money owed in circumstances creating, independently of the act, a legal liability in the employer to pay damages. Those are common law claims for negligence or contract breach that exist whether or not the statute exists.
The court found that "in the context of this fundamental distinction established by the WCR Act, it is only the concept of 'compensation' which would meet the description of a 'statutory benefit under' the WCR Act."
Common law damages claims simply do not fit that description. To find otherwise would require doing unacceptable violence to the settlement deed's text, Justice Sullivan wrote.
The exception existed because section 110 of the workers compensation act says workers cannot relinquish entitlement to compensation and any agreement trying to do so is void. Without the carve-out, the entire settlement would have been worthless.
Then came the financial blow. The settlement deed included an indemnity clause requiring any party breaching the settlement terms to pay the other side's costs on a full solicitor-client basis, plus all expenses, losses and damages arising from the breach.
Bakhit sued over released claims. The indemnity clause triggered. She now owes Hartley Healy's legal costs from four years of litigation, potentially exceeding the thirty thousand dollars she received in 2017.
The lessons for HR are stark. Settlement deeds need precision. The phrase statutory benefits under the workers compensation act means only the payments the statute creates, not common law rights the statute merely regulates. Exceptions should preserve only what the law prohibits releasing. And indemnity clauses for breaching settlement terms enforce strictly. The financial consequences can dwarf any settlement benefit.
