The employee relations team leader took her former employer to court for unfair dismissal, but the court found she was sacked for bullying other workers whom she gave the "silent treatment".

The Federal Court accepted the Catholic Education Office's position that the woman was sacked after she created "a climate of intimidation and fear" leading to a complete breakdown in workplace relationships.

The employee relations specialist for the Catholic Education Office in Parramatta alleged she had been sacked for taking sick leave to recover from a mental breakdown.

She also made allegations of sexual harassment after one of her bosses asked her to take part in an interview in his hotel room. On another occasion, she said he had advised her to "do the Pretty Woman thing" when addressing her male colleagues.

She said the executive had complemented her for looking "particularly fresh" and referred to her as "Maggie Thatcher", adding that: "I bet you don't have frilly lace around your bed."

Another boss had allegedly "leered" at her breasts, saying "I think we are going to get along just fine".

However, the court found the allegations of sexual harassment were not made out.

In rejecting the allegations, it was argued the interview involving two other people via Skype was moved from the hotel reception area to a private room to avoid the interference of background noise.

It was argued that the Pretty Woman reference (to the Julia Roberts movie of that name) was aimed to encourage behaviour like the Richard Gere character who secured the attention of sales staff after assuring them he would spend an "obscene amount of cash" in their store. The notion that the comment had anything to do with acting like a "woman of the night" was rejected.

The allegation of "leering" was not tested.

However, Justice Geoffrey Flick accepted an independent investigation that found "resounding evidence" the human resources team leader had behaved aggressively to co-workers. Examples included humiliating the workers, giving them the "silent" treatment and making "competent employees appear incompetent in the hope they will resign".

These complaints were substantiated with "resounding evidence" of bullying.

Justice Flick said the employee was unable to establish a complaint was ever made about her alleged discrimination, other than "oblique" references which were not properly explained.

Not only had the conduct created fear and intimidation, it was also found to have impacted on other teams and on workplace productivity.

"This long-running dispute has been extremely costly for the organisation, with the disruption and ongoing gossip in the workplace a hidden but additional cost," the court found.

The application the woman's sacking was related to a mental illness, absence from work or the violation of any workplace rights was rejected. It was found the termination of employment was related to the woman's lack of trust, respect and confidence in the workplace.