Activewear chain Lorna Jane has been hit with a $500,000 lawsuit.
Former store manager Amy Robinson is claiming more than $500,000 in damages for pain and suffering sustained during a six-month tenure with the company in 2012.
Robinson is also claiming for ongoing psychiatric problems.
The former staff member allegs she was bullied due to her size and regularly advised to skip meals.
Robinson, a size 14, claimed the bullying effected all areas of her life including her three children.
Lorna Jane public relations manager Belinda Zordan told ragtrader.com.au the company will fight the allegations.
"Lorna Jane vehemently denies the allegations made by Amy Robinson.
"As much as we would like to comment further to defend the allegations, as the matter is before the courts, unfortunately we are unable to do so.
"Saying that, we can say that in 26 years of business the company has never experienced any such legal claims, despite providing employment for thousands of people. "
The latest case follows a media backlash in July, after the company advertised for a small sized receptionist.
Lorna Jane defended the advertisement, noting the applicant would also work as a fit model for the brand.