How are employees using the Fair Work Act? - Thomson …sites.thomsonreuters.com.au/workplace/files/2010/11/... · · 2011-02-10the Fair Work Act? Josh Bornstein, Principal. What

How are employees using the Fair Work Act?

Josh Bornstein, Principal

What are employees rights of complaint?

• Continuing:• unfair dismissal;• unlawful dismissal (non-national system employees only);• freedom of association (subsumed into GP);• dispute resolution.

• New:• general protections;• section 351 jurisdiction.

• Today’s focus is:• Unfair dismissal;• Adverse action claims within the general protections provisions;• Section 351 jurisdiction.

Unfair dismissal under the Fair Work Act

The story so far…Recapping unfair dismissal

• FW Act:• abolished 100 employee threshold;• introduced high income threshold (but no application

to workers on awards or enterprise agreements);• introduced 6 and 12 month qualifying periods;• introduced small business dismissal code;• introduced threshold issue of ‘genuine redundancy’

• 4.5 million additional workers have protection from unfair dismissal (after qualifying period);

• Test for when a dismissal harsh, unjust or unreasonable largely untouched

The story so far…Termination of Employment Claims

09/10 08/09

Unfair termination (s394 FW Act) 11 116 -

Unfair termination (s643 WR Act) 218 3234

Unlawful termination (s.772 FW Act) 262 -

Unlawful termination (s643 WR Act) 87 1687

Unlawful and unfair termination (s643 WR Act) 183 3073

GP dismissal disputes 1176 -

13 042 7994

FWA Termination of employment applications – 08/09 v 09/10

The story so far…Termination of Employment Claims

• Comparing FWA unfair dismissal claims against WRA unfair dismissals decided by Tribunal in 09/10 :• Dismissal of matter on jurisdictional grounds significantly less

likely under FW Act - 54% dismissed under WR Act cf 34% under FW Act;

• Reinstatement more likely under FW Act – 2.36% under WR Act cf 7.6% under FW Act;

• Employee claim upheld – 7.7% under WR Act claims cf 26% under FW Act;

• Employee claim dismissed on merits – 13.17% under WR Act claim cf 19.89% under FW Act claims;

• Fewer applications are dismissed (at hearing) as out of time than under the WR Act (2.5% under the WR Act cf 1.8% under FW Act).

The new elements…Telephone conciliation

• More than 90% of unfair dismissal conciliations conducted by telephone in the first instance

• 81% settled at first conciliation• FWA annual report shows that conciliation settlement rate up to 81%

from 75%• 78% of applicants, 81% of respondents and 58% of representatives

agreed or strongly agreed the conciliation of an unfair dismissal application by telephone conference works well.

• 78% of applicants, 88% of respondents and 100% of representatives had a face to face conciliation since agreed or strongly agreed that the conciliation worked well through this method.

The new elements…Small business dismissal code

• FW Act introduced the small business dismissal code• Applies to businesses with fewer than 15 employees (currently full

time equivalent, moving to head count method on 1 January 2011)• An employee’s dismissal is not unfair if it complies Small Business

Dismissal Code;

• The Code provides in part:

• it is fair to dismiss an employee summarily if the employee is guilty of serious misconduct [FWA 388.20]

• if no serious misconduct, employer must give a valid reason why the employee is at risk of dismissal and must provide employee with an opportunity to respond and rectify [FWA 388.60]


Iannello v Motor Solutions [2010] FWA 3125:• employee returning to work from a period of maternity leave;• employer alleged business could not sustain return full time, even

though another employee was acting in her role on a full time basis;• employee advised that she expected to return to her full time role;• employee was terminated the following day on basis of redundancy;• employer argued that Code applied to redundancy situations – and

that if the Code had been complied with, the employee could not bring an unfair dismissal claim;

• VP Watson said he was ‘unable to conclude that the checklist applies to redundancy situations’ and was obliged to consider whether there was a genuine redundancy;

• held that not a genuine redundancy, and matter could proceed on merits.


Mr N v The Bakery [2010] FWA 3096• Mr. N dismissed for serious misconduct (theft);• employer completed the Dismissal Code Checklist in good faith;• employer formed the view on basis of Checklist that not required to:

• give employee right of reply;• allow employee to have a support person present.

• O’Callaghan said:• employer had reasonable ground for summary dismissal;• checklist did not alert employer to requirement for support person • concluded that ‘the checklist is of dubious value as a determinant

of whether the Code has been complied with ...’• if Code not complied with, section 387 must be applied;• Dismissal harsh: no notice, no support person.• the checklist is not a statutory instrument, and need not be used.

The new elements…Genuine redundancy

• WR Act had exemption for “operational reasons”

• FWA incorporates the notion of a “genuine redundancy”

• If a dismissal is a genuine redundancy then it is not unfair (s385)

• Section 389 sets out that a dismissal is a genuine redundancy if:• the employer no longer required the job to be done by anyone

because of changes in the operational requirements of the employer’s enterprise;

• the employer complied with any obligation to consult about the redundancy contained in a modern award or enterprise agreement; and

• the employee could not be reasonably redeployed within the employer’s enterprise, or the enterprise of a related entity.

The new elements…Genuine redundancy

• Ulan Coal Mine v Howard and Ors [2010] FWAFB 3488• Employees dismissed on basis of redundancy following

restructure in which their duties were subsumed into other jobs;• Tribunal at first instance focused on the ongoing need for the

work performed by the dismissed workers - held no genuine redundancy and hence employees’ UFD applications could be heard;

• On appeal, Full Bench held that the test is not whether the employees duties were still needed, but whether the employer wanted the employee’s job to be done by anyone;

• Employer had restructured and subsumed employees’ duties into other positions – that constituted a genuine redundancy;

• However, the obligation to redeploy under section 389(1)(b) was still in issue – matter referred back to Tribunal for hearing and determination on redeployment.

Adverse action claims under the General Protections Provisions

The story so far…First - the work of the Courts

• Federal Court:• 43 Fair Work Act claims filed• Down from 157 industrial claims filed in 2008/9• 25 of the 43 remain on foot• 11 of the 43 were brought by self-represented litigants

• Between 1 January 2010 and 30 June 2010:• 254 GP disputes (not involving dismissal) filed in FWA• 1176 GP dismissal disputes filed in FWA• Certificate of merits issued in 377 applications

• 6 substantive Federal Court decisions• No Full Court authority yet, but:

• Barclay appeal heard on 2 August 2010 before Justices Gray, Lander and Bromberg – yet to be handed down.

The story so far…Adverse action claims

• The FW Act consolidates a range of protections under the banner of ‘general protections’.

• The general protections provisions cover a range of protective provisions for employers, employees and independent contractors,including:• the new workplace rights provisions;• industrial activities (subsuming the old ‘freedom of association

concept, and including coercion and misrepresentation);• provisions dealing with discrimination, protection from dismissal

on the basis of temporary illness or injury;• bargaining services fees;• discrimination against employers on the basis of the industrial

instruments covering the employers employees; and• sham contracting arrangements.


• The FW Act introduces the concept of ‘adverse action’ within the general protections provisions.

• Adverse action operates in relation to:• workplace rights;• industrial activities; and• the section 351 discrimination jurisdiction.

.• Adverse action is taken by an employer against an employee if the

employer:• dismisses the employee;• injures the employee in his or her employment;• alters the position of the employee to their prejudice; and• discriminates between the employee and other employees of the

employer.


• A broad range of remedies are available for contraventions, including:• interlocutory injunctions;• compensation for loss and damage; and • pecuniary penalties.

• Applications involving a dismissal must be commenced in Fair Work Australia and are sent to compulsory conference (unless an interim injunction is sought);

• Applications alleging a contravention other than dismissal may be commenced in Fair Work Australia, but the Tribunal may only convene a conciliation with the consent of the respondent(s).

Adverse action – workplace rights

• Key area in which adverse action operates is workplace rights.• A workplace right is defined in section 341of the FW Act as follows:

(1) A person has a workplace right if the person:

(a) is entitled to the benefit of, or has a role or responsibility under, a workplace law, workplace instrument or order made by an industrial body; or

(b) is able to initiate, or participate in, a process or proceedingsunder a workplace law or workplace instrument;

(c) is able to make a complaint or inquiry:

(i) to a person or body having the capacity under a workplace law to seek compliance with that law or a workplace instrument; or

(ii) if the person is an employee -- in relation to his or her employment.

Adverse action – workplace rights

• Three elements to making out an adverse action claim based on a workplace right:

1. the existence of a workplace right within the meaning of s340;

2. that adverse action has been taken; and

3. that there is a causal link between the workplace right and the adverse action.

Adverse action– workplace rights

• The first two elements must be established by the applicant;• In relation to the third element (the causal link), section 361 of the

Act reverse the evidentiary onus such that:• the applicant must fairly raise the third element on the

evidence; • if the Applicant can do so, the burden of proof for the third

element is reversed;• the Respondent bears the onus of proving that the adverse

action was not taken because of the applicant’s workplace right.

Adverse action – workplace rightsSome key decisions - Barclay

Barclay v The Board of Bendigo Regional Institute of TAFE

• Barclay was an employee of the TAFE and also a union representative (Sub-Branch President) with the AEU;

• Barclay sent an email to union members, who were his colleagues,stating that he had heard that members were being pressured to prepare false documents for a pending audit;

• Barclay urged members not to falsify documents;

• Barclay did not inform management of the allegations;

• Some recipients of the email forwarded the email to management;

• Barclay was suspended on full pay pending investigation of the matter;

• Barclay’s internet access was suspended for the duration of the investigation.


Barclay v The Board of Bendigo Regional Institute of TAFE• Barclay said his workplace right was:

• the exercise of a role or responsibility under the Victorian TAFE Teaching Staff Multi-Business Agreement 2009 (as a union representative); and/or

• the exercise of a workplace right, being the ability to participate in a process or proceeding under a workplace instrument (the dispute settlement procedure of the agreement);

• Also alleged the adverse action was taken because of his union membership and his involvement in lawful industrial activity;

• The adverse action was said to be suspending him from work; suspending his internet access; and directing him not to attend the work premises.


Barclay v The Board of Bendigo Regional Institute of TAFE

• TAFE accepted it had taken adverse action of the kind alleged;

• Tracey J:

• accepted that the employee, as an official of a union, had a workplace right to talk to other employees and advise them, ‘independently of any provision in the [collective] agreement’;

• held that subjective reason for the employer taking the action was to be considered in determining whether the link between the adverse action and the workplace right was established i.e. not an objective test


Barclay v The Board of Bendigo Regional Institute of TAFE• Tracey J:

• held that there was insufficient evidence to establish the causal link;

• accepted the CEO’s evidence that she did not want Barclay on the premises making unsubstantiated allegations while an auditor waspresent;

• accepted the CEO’s evidence that she wanted Barclay to respond to the show cause letter to explain why a further disciplinary action should not be taken against him;

• observed that, even if the causal link had been established, Barclay was unable to show that he had suffered any loss or damage, and would not have been entitled to compensation in any event.

Adverse action – workplace rightsSome key decisions

LHMU v. Arnott’s Biscuits Limited [2010] FCA 770

• Three employees had failed to follow a company policy relating to safety procedures in connection with the use of a cutting machine;

• Following company investigations, the company offered the employees a one month suspension without pay in lieu of termination;

• The option of the suspension in lieu of termination was offered because the employer concluded that the three employees had engaged in serious misconduct.

• The suspension was not provided for in their contracts of employment or in the applicable enterprise agreement;


LHMU v Arnott’s Biscuits Limited [2010] FCA 770

• Court accepted that workplace right included:

• right to undertake at least the minimum hours of paid work for which their certified agreement provided;

• right not to be stood down except in accordance with s 524 of the Fair Work Act unless their certified agreement or their contract of employment otherwise provided.

• Court held that employer did not breach because action taken because employer concluded employees had breached company policy, not because employees had workplace rights.


Jones v Groovy Freighters Pty Ltd [2010] FMCA 673

• Claim under section 351 – adverse action (dismissal) on the basis of a disability (back injury)

• Claim not made out, however, for completeness, FM Burnett address the question of penalty, and said:

However, either circumstance would have given rise to a contravention in respect of which I would have been required to assess the appropriate penalty. If so, I would have assessed thepenalty at the quantum of his contractual remedies. That is one week’s pay and direct that it be paid to the applicant.

• Decision seems to conflate damages and penalty?;

The new section s351 jurisdiction

s351 claimsThe story so far…

• No significant case authority yet;

• Uncertainties in jurisdiction perhaps driving a cautious approach to these claims;

• Significant choice of jurisdiction issues arise:

• FW Act does not impose positive obligations for reasonable adjustments re: disability discrimination, family and carer’s responsibilities etc;

• sexual harassment not explicitly provided for cf. Sex Discrimination Act;

• complex exemption provisions;

• costs protection applies.

s351 claimsJurisdictional considerations

• Despite the heading ‘discrimination’, the section 351 jurisdiction operates by reference to ‘adverse action’;

• Section 351 provides:• An employer must not take adverse action against an employee

or a prospective employee because of the person’s [prescribed attributes]

• An employer takes adverse action against an employee if the employer:• dismisses the employee;• injures the employee in his or her employment;• alters the position of the employee to their prejudice;• discriminates between the employee and other employees of

the employer


• Meaning of ‘discrimination’:

discrimination is not defined;• leaves open the question of whether adverse action

‘because of’ a prescribed attribute includes conduct that indirectly discriminates;

• ‘Because of’• use of the term ‘because of’ may import a subjective

element (Barclay) – in many anti-discrimination statutes the intention of the discriminator is irrelevant to whether or not discrimination has occurred.


The question of exemptions/defences:• The FW Act contains complicated exemptions;• Section 351(2) provides:

However, subsection (1) does not apply to action that is: (a) not unlawful under any anti-discrimination law in force in the place where

the action is taken; or (b) taken because of the inherent requirements of the particular position

concerned; or (c) if the action is taken against a staff member of an institution conducted in

accordance with the doctrines, tenets, beliefs or teachings of a particular religion or creed--taken:

(i) in good faith; and

(ii) to avoid injury to the religious susceptibilities of adherents of that religion or creed.


• The question of exemptions/defences (cont)

• Effect of section 351(2) is that a defence that could be pleaded under another anti-discrimination law is available as a defence to a section s351 complaint;


• The question of exemptions (cont)• section 351 also contains an exemption for action ‘taken because of

the ‘inherent requirements of the particular position ’;• the exemption is linked to employee’s ‘position’ concerned and not

‘job’;• cf ‘particular work’ exemption under the Disability Discrimination

Act 1992 (Cth);• the inherent requirements exemption is not tempered by positive

obligation provisions:• cf the Disability Discrimination Act (positive obligation to make

reasonable adjustments for persons with a disability);• cf the Equal Opportunity Act (Vic) (positive obligation to

accommodate carer’s / family responsibilities).


• Yet to see how this jurisdiction will develop• Positives include:

• benefit of reverse onus;• ability to deal with multiple issues in one action (eg, adverse

action on basis of complaint + discrimination); and• Attribute need be only one reason for the adverse action (as

compared to a ‘substantial’ or ‘predominant’ reason.• Drawbacks

• significant construction issues• lack of clear definition of discrimination;• conciliation voluntary in cases not including dismissal; and• limited to action by employer – limited capacity to name

individuals.• ‘No cost’ jurisdiction – both positive and negative implications.

Documents

How are employees using the Fair Work Act? - Thomson …sites.thomsonreuters.com.au/workplace/files/2010/11/... · · 2011-02-10the Fair Work Act? Josh Bornstein, Principal. What