Introduction

The Fair Work Ombudsman has secured $121,000 in penalties in court against the former operators of a grocery store in the Melbourne CBD for paying migrant workers as little as $10 per hour, despite having been put on notice of workplace laws.

Asian grocery store

The Federal Circuit Court has imposed a $90,000 penalty against Jenni International Pty Ltd, which previously operated the Dae Bark Mart Asian grocery store in Flinders Street, and a $31,000 penalty against the company’s former owner-operator, Jordan Shan.

Mr Shan and Jenni International underpaid two employees from South Korea – both aged in their mid-20s and in Australia on working holiday visas – a total of $13,997 over a period of less than four months in 2016.

Fines and backpay

In addition to the penalties, the Court has ordered Mr Shan and the company to rectify the underpayments in full, plus interest.

The underpayments occurred despite the Fair Work Ombudsman having put Mr Shan on notice of Commonwealth workplace laws in 2015.

Fair Work Ombudsman Sandra Parker said employers that deliberately underpay vulnerable workers even after being put on notice should expect to face legal action.

“Employers are on notice that they must pay all workers according to Australia’s lawful minimum pay rates or risk significant financial penalties. We prioritise matters involving vulnerable workers, especially if we think breaches are deliberate,” Ms Parker said.

“All workers have the same rights regardless of nationality or visa status. Any worker concerned about their rights can contact us for free advice and assistance.”

Fair Work inspectors

Fair Work inspectors investigated after the two underpaid employees lodged requests for assistance. One of the employees, engaged full-time, worked six or seven days a week with duties including ordering and stacking stock. The other was a part-time cashier.

The employees were paid flat rates of $10 to $12.50 per hour, despite being entitled to $19.44 for ordinary hours and penalty rates of $24.30 to $48.60 under the General Retail Industry Award 2010, at the time. Annual leave entitlements were also underpaid.

Judge Alister McNab said the underpayments were significant and deliberate and that Mr Shan and the company had not exhibited contrition.

“The conduct of the Respondents was deliberate and involved a number of employees where the underpayment of their entitlements was significant. The underpayment of entitlements also occurred where (Mr Shan) is a highly educated person and had previously occupied a senior position as an Associate Professor of Applied Economics at Victoria University,” Judge McNab said.

Judge McNab said the penalties imposed are “a strong disincentive for small businesses to engage in similar conduct”.

by Michael Byrnes, Swaab

In the recent decision of Retail and Fast Food Workers Union Incorporated v Tantex Holdings Pty Ltd [2020] FCA 1258, an Australian court (namely the Federal Court) has, for the first time, held that employees have a workplace right to use the toilet and drink water while at work.

This determination was made by the court in considering whether the employer, Tantex Holdings Pty Ltd (Tantex), which operates a number of McDonald’s restaurant franchises, had, in a number of posts on Facebook, contravened the general protections provisions of the Fair Work Act (the Act) (including by making false or misleading representations in breach of section 345 of the Act).

Justice Logan of the Federal Court held that even though employees had an express right, pursuant to the applicable enterprise agreement, to a 10 minute drink break and/or 30 minute meal break after working a specified number of hours, they were also entitled to be given a reasonable opportunity to have a drink of water or to use the toilet outside these specified drink and meal breaks.

In reaching this conclusion, Justice Logan considered the terms of the applicable enterprise agreement, the Work Health and Safety Act 2011 (Qld) (WHS Act) and the Work Health and Safety Regulation 2011 (Qld) (WHS Reg). His Honour accepted that there were no express terms in the applicable enterprise agreement, WHS Act or WHS Reg that conferred a specific right for an employee to use the toilet or drink water outside mandated breaks while working.

Rather, the WHS Act imposes a broader obligation, specifically that a person conducting a business or undertaking, in this case Tantex,

“must ensure, so far as is reasonably practicable, the health and safety of workers engaged, or caused to be engaged by the person.”

Regulation 41 of the WHS Reg expands upon this obligation and requires a person conducting a business or undertaking to “ensure, so far as is reasonably practicable, the provision of adequate facilities for workers, including toilets, drinking water, washing facilities and eating facilities.”

In analysing the issue, Justice Logan stated:

“There is not much point in imposing a statutory duty on an employer to provide, materially, toilets or drinking water if an employee cannot access the same. Neither does it seem to me an answer to say that the Agreement provides for breaks after specified numbers of hours of work and that the required facilities can be accessed during these breaks. So they can. But the breaks are termed “drink break” and “meal break”, the titles being indicative of their purpose. In particular, neither has as its purpose the use of toilet facilities. Neither does a need to use toilet facilities necessarily arise with particular, predictable, temporal regularity. Denial of access as needed to toilet facilities or drinking water could, as a matter of ordinary life experience, have adverse health and safety ramifications for an employee and thus enliven the primary statutory duty of an employer found in s 19 of the WHS Act. On the other hand, it is not hard to see how some employers might under the guise of toilet or drink break needs avoid the undertaking of duties for which they are employed. Reconciliation of this latter consideration with this primary statutory duty would, as its specification indicates, be within the realm of what is ‘reasonably practicable’ “.

As there were apparently no Australian authorities on the question of the right of employees to use the toilet or consume drinks, Justice Logan referred to a decision of the Ohio Court of Appeals, Zwiebel v Plastipak Packaging Inc. In considering that decision, his Honour stated:

“In upholding a conclusion reached at trial that the termination was lawful, the Ohio Court of Appeals did not dissent from the joint position of the parties that a conclusion of the trial judge that ‘there is a public policy that requires the employer to make available toilet facilities, although reasonable restrictions may be placed on access’ flowed from an occupational health & safety specification in relation to the provision by an employer of toilet facilities similar to reg 41 of the WHS Reg. The upholding of the termination turned on what was regarded on the facts as an unreasonable conduct in breach of a reasonable restriction. The restriction was that the employee should seek another to cover for him while absent.”

Justice Logan adopted the submission of the union that, “Facilities are not ‘accessible’ if they are only available during scheduled breaks.”

His Honour then provided an explanation of how this right would apply in practice for the relevant employees. In doing this, Justice Logan provided an exposition that provides guidance for all employers:

“Tantex was obliged, even outside the 10 minute drink break (or the meal break for that matter) to allow an employee access during paid time to the toilet and drinking facilities it was obliged to provide, although it was permissible for it to a place a reasonable restriction on that access. What might amount to a reasonable restriction is inherently fact specific, as Zwiebel v Plastipak Packaging illustrates. One might think, for example, that the refusal of access to time off for a drink within a few minutes after the clause 29 mandated drink break was a reasonable restriction but, on a particularly hot day in circumstances where air-conditioning in a kitchen area was failing to deny a sweating Crew Member in the kitchen that time off might not be reasonable. Equally, for an employee just dash off for a drink leaving hamburger patties or fries to burn might not be reasonable. One might hope and expect that occasion such as Zwiebel v Plastipak Packaging for determining whether employer or employee conduct was or was not reasonable would be infrequent. That is because, as in human affairs generally, in relations between employer and employee, the reasonable conduct of one tends to engender the reasonable conduct of the other.”

Accordingly, his Honour held that the right of an employee to access the toilet or a drink of water was a workplace right for the purposes of the Act.

Conclusion

It seems extraordinary that it has taken until 2020 to clearly establish that there is a legal right for employees to use the toilet and drink water at work. While some might see that as evidence of extensive Dickensian or dystopian work practices, it could be argued, more prosaically, that it is such an obvious proposition that it has not needed to be established judicially until now (and even then it was actually for the purpose of determining whether certain social media statements were false or misleading representations in breach of the general protections provisions of the Act).

Notwithstanding the fundamental nature of the right, there is still, however, a balance to be struck between the exercise of the right by employees and the duty of employees to properly and diligently perform their duties.

As such, while individual cases will largely turn on their own facts, there are some guiding principles for employees and employers that emerge on the issue from this decision:

(1) The right to access the toilet or a drink of water during work, even outside rest breaks, is a workplace right.

(2) In some circumstances, however, it might be reasonable for the employer to restrict the exercise of that right by the employee. For instance, employers might be able, within reason, to expect employees to arrange cover or otherwise mitigate the impact of taking a toilet break.

(3) Employees cannot simply use the pretext of needing to use the toilet as a device or strategy for avoiding work.

(4) The need for toilet or drink breaks might depend on the conditions of the working environment. For instance, a hot working environment might necessitate more frequent opportunities for employees to take a drink.

Ultimately, it is to be hoped that employers and employees can exercise common sense and reasonableness in relation to such a basic yet fundamentally important issue. In situations where they can’t, there is probably not much hope for other aspects of the employment relationship.

For further information please contact:

Michael Byrnes, Partner
Phone: +61 2 9233 5544
Email: mjb@swaab.com.au

by James Fisher and Josephine Renfrey, Hazelbrook Legal

The recent Full Federal Court decision in Jamsek v ZG Operations Pty Ltd is yet another warning to businesses to ensure they are not misclassifying those who should be treated as employees.

Historical case law has set out a tried and true set of criteria for determining whether an individual is an employee or an independent contractor: ABNs, bringing their own tools, holding their own insurance, and day-to-day autonomy all make the list as factors indicating a contractor relationship. Despite this, in the judgement in Jamsek v ZG Operations Pty Ltd1, the Full Federal Court has held that the substance of the relationship takes absolute precedence over these factors. According to the court, the degree of control exercised by an employer is paramount: not only in how day-to-day tasks are carried out, but in the way that a particular job dominates the working life of the individuals concerned, and the circumstances under which the contract is entered. As with all such cases, these are questions of fact and degree which must be examined on a case-by-case basis, but with 35 years’ back pay being the probable penalty, the case is a timely reminder to businesses that a superficial consideration of the classifications is not enough.

HOW HAS THE STANDARD CHANGED?

The Jamsek v ZG Operations Pty Ltd1 case represents a change of focus in employee / contractor cases. It is not enough to bear the hallmarks of a contractor where the degree of control exercised over the individual’s working life is so severe as to prevent them from truly functioning independently of the employer. The relationship in question was between two truck owner-drivers and the company with whom they were engaged. For the court, the most significant factors indicating an employment relationship were: that the drivers could not practicably contract with any other company as a result of their working hours; that all goodwill generated by them accrued to the company; and the ‘take it or leave it’ nature of the contract. These factors suggested that the drivers had “no real independence” and were without “real or effective control in respect of the key aspects of the work relationship”.

This was despite the fact that the drivers had made a significant investment in their equipment, held a large amount of the associated risk, and had control over a number of day-to-day aspects of their work. There were also formal markers of independent contractors. Their contract listed them as contractors (which was reflected in their tax and GST arrangement), they had the opportunity to adjust their profitability, and could make operational changes without approval of the company. Yet these factors were ultimately outweighed by the reasons explained above.

IMPLICATIONS FOR BUSINESSES

Here, the court is demonstrating intolerance of employment relationships that masquerade as independent contract arrangements. The judgment implies that a relatively substantial degree of control is present in true independent contracting relationships and that, without control, workers are employees and are owed entitlements.

For those businesses engaging independent contractors, it will be critical to re-assess those arrangements and take note of any areas of uncertainty

Red flags include where contractors are unable to perform work for any other entity or have a lack of control over their work hours, leave, or their contract. In our view, these factors indicate a degree of control exercised by the company which removes any practical independence.

Ultimately, these matters are highly dependent on the unique situation of each business and its contractors, and the history and ongoing nature of their working relationships. If you have any queries or concerns about whether independent contractors may be entitled to employment benefits, please get in touch with our team at Hazelbrook Legal.

WHAT HAPPENED IN JAMSEK V ZG OPERATIONS?

Below is an outline of the significant factors that tipped the scale to the drivers, and why they meant that the relationship was employer/employee.

Lack of control

Despite control over their choice of vehicles and route, the degree of control enforced by the company was found to be too great. The drivers maintained visible logos of the company on their vehicles and clothing and worked full working weeks solely for the company- making it impracticable to conduct work outside of the arrangement as a result. The implication for businesses is that it is not sufficient for independent contractors to have some control, but instead that control must be substantial. It also implies that the ability to conduct business outside of the arrangement can be key.

Goodwill

The drivers were also unable to generate goodwill on behalf of themselves. All benefit derived from the good business and conduct of the drivers was reflected on the company, not the drivers themselves. According to this new standard, a key factor in defining an independent contractor is their ability to represent themselves independently of the company they are contracting for, and to derive the resulting benefits.

Nature of the Contract

Another relevant factor was the nature of the arrangement from the outset. The drivers were offered “take-it-or-leave-it” contract, whereby the company made clear that either the men accept the new arrangement or face redundancy. Furthermore, the ultimatum-like nature of the offer did not represent a true independent contracting arrangement, as the drivers had little ability to dictate terms. It is therefore important to consider the ability of the independent contractor influence the contract itself as a key element in distinguishing an independent contractor from an employee, noting that employees generally have little power over their contract. Furthermore, the initial contract in this case was not revisited as frequently as one would expect of an independent contracting arrangement, again better resembling an employment contract.

The drivers will likely be awarded 35 years’ worth of annual leave and superannuation entitlements

Although damages have not been confirmed, the drivers will likely be awarded 35 years’ worth of annual leave and superannuation entitlements, reflecting the years they operated as contractors, but were, in fact, employees.

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Introduction

As was the methodology of some unions in many years gone by, employers would give the union organiser a paper bag of cash (usually at Christmas to pay for its employees’ union’s fees. In return, industrial peace. But don’t caught!

In the matter Registered Organisations Commissioner v Australian Workers’ Union (No 2) [2020] FCA 1148, Justice Snaden of the FCA penalised the Australian Workers’ Union (AWU) $148,100.00 as “general deterrence” in such matters.

The Fair Work (Registered Organisations) Act 2009

The Fair Work (Registered Organisations) Act 2009 (Cth) regulates the creation and management of industrial organisations that operate within the landscape of federal industrial law. Amongst other things, it imposes a number of administrative obligations with which such organisations must comply. Broadly speaking, the “Commissioner” — the holder of a statutory office established by this Act—is charged with ensuring that compliance.

AWU falling foul of the Act

In this case, the AWU failed to comply with its statutory obligations over the period spanning January 2008 to March 2013. At the core of that accusation are arrangements that the AWU struck with seven entities:  Cleanevent Australia Pty Ltd, Winslow Contractors Pty Ltd, BMD Constructions Pty Ltd, the Australian Jockeys’ Association, the Victorian Jockeys’ Association, the Australian Netball Players’ Association and Geotechnical Engineering Pty Ltd. Principally, those arrangements were struck via the agency of its former Victorian branch secretary, Mr Cesar Melhem.

Each of the six entities (the Australian Jockeys’ Association and the Victorian Jockeys’ Association were, in effect, treated as a single body) agreed to pay to the AWU certain sums of money that, in each case, the AWU accounted for internally as membership revenue, specifically in respect of certain employees or members of those entities. Details of those employees or members were then entered into the AWU’s own membership records. Effectively, the AWU admitted to the ranks of its membership persons who had not applied to become members and did not know (at least not directly on account of anything that the AWU told them) that they were such. Those people became unwitting subjects through whom the AWU (or its Victorian branch) artificially inflated its membership levels over a period of many years.

Formal arrangement

This was considered a legitimate industrial process. For example the AWU struck a Memorandum of Understanding (a quasi-legal agreement) that it would pay, on behalf of employees of Cleanevent who are or become members of the AWU, the employees’ union fees up to $25,000 for each financial year up to 30 June 2013. Payments will be made by Cleanevent biannually (December and June) to the AWU on receipt of a list of Cleanevent employees and the associated membership fees that Cleanevent are being requested to pay.

In return, Cleanevent would:

“During the period of operation of the MOU it is understood that the AWU will not commence or take any step which may result in the commencement of enterprise bargaining under the Fair Work Act 2009; or seek to terminate (or support or encourage the termination of) the Cleanevent EBA or the aforementioned MOU”.

 

“Ghost” training and OH&S inspections

Another tactic of the AWU was to invoice the company for the union fees, which the company would then pay. As was the case in Winslow Contractors Pty Ltd. The union fees were cloaked in the description of “OH&S Training & Workplace Inspections”. The AWU also invoiced the company $23,166.00 for “red Card” (industry OH&S training) not undertaken. And so, it went on: $23,166.00, $44,401.50, $38,857.50, $81,640, $85,280…

In the case of BMD Constructions Pty Ltd, the amounts were $14,300, $19,800, $19,800.00

“Service payment”

In the case of the Australian Jockeys’ Association/Victorian Jockeys’ Association, contribution was recorded in the minutes of its 2009 annual general meeting:

“Paul proposed that the AJA to show its good faith in the AWU in each of the states make a contribution for their support in the past and particularly with industrial matters that might occur in the future.  Paul advised that in the budget he had allocated approx. $30,000 per annum to the AWU which would be on a state by state basis depending on the number of jockeys in that state. All agreed that the payment would be a service payment, not membership.”

This payment was followed by subsequent “service payments” of $7,500, and $8,250…

And the amounts and subterfuge were similar for the rest of the names parties.

New broom

The so-called “architect” of this scam was (now) Victorian state parliamentarian, Mr Cesar Melhem in his (then) role as secretary of the AWU’s Victorian Branch.

The new secretary, Mr Davis, set about implementing measures to ensure that the AWU’s Membership Register was and remained up to date. Including from May 2015, putting in place a process whereby membership forms pertaining to members whose employers paid for their membership subscriptions were more closely scrutinised. “Company paid” members were identified and, if a membership form could not be found for them, they were either asked to fill one out or their details were removed from the Membership Register.  That has resulted in the position today being that, as Mr Davis put it, “[t]he Victorian Branch no longer accepts as members anyone who has not submitted a membership application form as required by the AWU Rules”.

The statutory framework

Two provisions of the FW(RO) Act assume primary significance in this matter.  Section 230 provides (and, at all times since 1 July 2009, provided) as follows:

230  Records to be kept and lodged by organisations

(1)          An organisation must keep the following records:

(a)          a register of its members, showing the name and postal address of each member and showing whether the member became a member under an agreement entered into under rules made under subsection 151(1);

Note:    This subsection is a civil penalty provision (see section 305).

(2)          An organisation must:

(a)          enter in the register of its members the name and postal address of each person who becomes a member, within 28 days after the person becomes a member;

(b)          remove from that register the name and postal address of each person who ceases to be a member under section 171A, or under the rules of the organisation, within 28 days after the person ceases to be a member; and

(c)           enter in that register any change in the particulars shown on the register, within 28 days after the matters necessitating the change become known to the organisation.

Note:    This subsection is a civil penalty provision (see section 305).

Note:    An organisation may also be required to make alterations to the register of its members under other provisions of this Act (see, for example, sections 170 and 172).

It is common ground that s 230(1) serves to prohibit the addition to an organisation’s register of members the details of persons who are not members.  Although the section does not say so in terms, I accept that it should be construed in that way.  A membership register that records the details of persons who are not members of the organisation by which it is maintained is not a register of the kind whose maintenance s 230(1)(a) mandates.

Section 172(1) of the FW Act provides as follows:

172  Non‑financial members to be removed from the register

(1)          If:

(a)          the rules of an organisation require a member to pay dues in relation to the person’s membership of the organisation; and

(b)          the member has not paid the amount; and

(c)           a continuous period of 24 months has elapsed since the amount became payable; and

(d)          the member’s name has not been removed from the register kept by the organisation under paragraph 230(1)(a);

the organisation must remove the name and postal address of the member from the register within 12 months after the end of the 24 month period.

Note:    This subsection is a civil penalty provision (see section 305).

Contraventions

The 11 contraventions of the FW(RO) Act (or its predecessor), from six discrete courses of conduct; that is, as one contravention in respect of each of the organisations from which members (or “members”) were sourced.

Pecuniary penalties

General principles

The court commenting:

“The sole object to which the court must give effect in setting an appropriate penalty is to deter repetition of the conduct in respect of which it is imposed…the court should strive to “…put a price on contravention that is sufficiently high to deter repetition by the contravenor and by others who might be tempted to contravene”:  I turn, then, to consider the matters by which the penalties to be imposed should relevantly be informed”. [Numerous citations removed].

Applicable maximum penalties

The court is empowered to impose penalties of up to $33,000.00 each—that is, 300 penalty units multiplied by $110, which was the value of a penalty unit in June 2012—or a total of $33,726,000.

Insofar as concerns the 11 Agreed s 230 Contraventions, the Commissioner appended to his written submissions the following helpful table, with which the AWU took no issue:

The parity principle

The AWU submitted that the penalties to be imposed presently should take account of the penalties that Mortimer J imposed upon Mr Melhem by means of the Melhem Judgment. In that regard, the AWU submitted:

“…that the Court should pay close regard to what Mortimer J has said in the Melhem Judgment, because the AWU’s contraventions flowed from the conduct engaged in by Melhem for which he has been subjected to pecuniary penalties. To avoid unwarranted inconsistency, and thus to uphold the administration of justice, this Court should take into account what Mortimer J has said about Melham’s contravening conduct and its connection to the AWU’s contraventions”.

Nature of the contravening conduct

The judge finding:

“…Over a period of many years, the Victorian branch of the AWU dishonestly employed the concept of “company paid” membership to artificially inflate its membership ranks. As Mortimer J was at pains to point out in the Melhem Judgment (at, for example, [129], [138] and [140]), the evidence does not permit a finding as to why that process of artificial inflation was pursued. It seems sufficiently uncontroversial to observe that there must have been some benefit—either to the branch or, perhaps, to Mr Melhem himself—in doing so.  Why, one might ask rhetorically, would that process otherwise be carried out?  The capacity to wield greater influence within the AWU’s administrative structures…would seem to be one possible (if not obvious) explanation.

“It is unnecessary that the court should—and I do not attempt to—identify a motive for the conduct that sits at the heart of the Agreed Contraventions. It suffices to note that that conduct constitutes a serious departure from the important record-keeping standards with which the FW(RO) Act requires that all organisations comply.  In a number of respects, it qualifies as more serious still in light of the apparently fraudulent documentation that the AWU supplied to many of the entities from which the “company paid” members (or “members”) were sourced and the communication protocols—more accurately, the non-communication protocols—that the evidence suggests were engaged in respect of at least some of those individuals”.

Could have put their hands up earlier

“The AWU’s decision not to contest the charges that constitute the Agreed Contraventions is to its credit, no matter the late stage at which it was made; although, plainly, that credit would have been all the greater had concessions been made earlier.  Likewise, there is little doubt that the AWU has accepted a need to implement measures to avoid similar mismanagement in the future, and that it has expressed genuine contrition in respect of the conduct that assumes present relevance.  All of those are factors properly to be taken into account in the setting of pecuniary penalties—all inform how largely the need for specific deterrence looms.”

Determining the penalty

The parties are agreed that the total of the penalties that the court should impose should fall between 60% and 90% of the maximum (that is to say, between $96,600.00 and $144,900.00). The judge determining that the higher end is appropriate.

Conclusion

Pursuant to s 306(1) of the FW(RO) Act, the court will order that the AWU pay pecuniary penalties totalling $148,100.00, comprising:

  • penalties totalling $15,400.00—and comprising:
    • $8,000.00 in respect of the addition to the Membership Register of the 98 Cleanevent employees; and
    • $7,400 in respect of the addition to the Membership Register of the 66 Cleanevent employees—

for the two Agreed s 230 Contraventions that relate to Cleanevent;

  • Penalties totaling $33,000.00—and comprising:
    • $5,650.00 in respect of the addition to the Membership Register of the 43 Winslow that the AWU admitted as members in 2008;
    • $5,700.00 in respect of the addition to the Membership Register of the 58 Winslow that the AWU admitted as members in 2008;
    • $8,700.00 in respect of the addition to the Membership Register of the 169 Winslow that the AWU admitted as members in 2008;
    • $4,750.00 in respect of the addition to the Membership Register of the 15 Winslow that the AWU admitted as members in 2008; and
    • $8,200.00 in respect of the addition to the Membership Register of the 116 Winslow that the AWU admitted as members in 2008—

for the five Agreed s 230 Contraventions that relate to Winslow;

  • a penalty of $7,425.00 for the Agreed s 230 Contravention that relates to BMD;
  • a penalty of $8,250.00 for the Agreed s 230 Contravention that relates to the AJA and VJA;
  • a penalty of $7,425.00 for the Agreed s 230 Contravention that relates to the ANPA;
  • a penalty of $25,500.00 for the Agreed s 230 Contravention that relates to Geotech;
  • a penalty of $51,100.00 for the Agreed s 172 Contraventions.

Those penalties will, in each case, be payable to the Commonwealth (FW(RO) Act, s 306(2)) within 28 days.  Presumably conscious of the effect of s 329(1) of the FW(RO) Act, the Commissioner does not seek an order for costs and none will be made.

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Introduction

This case is fair warning for employers who have (either unconscious or conscious) bias against the employment of mature-age workers. Even if the person in question is a 70-year-old grader driver in the Pilbara.

In Australian Building and Construction Commissioner v CoreStaff WA Pty Ltd [2020] FCA 893, the Federal court of Australia has ruled against the labour-hire company who fundamentally argued it was only acting upon the wishes of its client. Noting that the client in question had already admitted its culpability and is awaiting penalty.

Please note that the Victorian Equal Opportunity and Human Rights Commission has a great deal of information on “age discrimination”. See for example here.

Background

This case follows the usual recruitment route when a company wishing to hire an employee may utilise the services of a recruitment company. In this case a labour-hire firm. That is to say, the assignment was provided to the labour-hire firm, the labour-hire firm placed an advertisement, applications were received. These applications were vetted (ie “shortlisted”) by the labour-hire company. With the shortlisted applicants forwarded by the labour-hire firm to the client.

Importantly, the position was to be on-hired from the labour-hire firm, meaning that the grader driver position would be an employee of the labour-hire firm, which would on-hire the employee to its client.

The FCA finding that the 70-year-old job application was indeed a “prospective employee” and the labour-hire firm a “prospective employer”.

“Prospective” what?

Under the Fair Work Act 2009, it is unlawful and deemed an “adverse action” to discriminate for reason of age. This extends not only people who are employed but those employees who are not employed because of their age. This may also apply in the reverse – a person considered too young or lacking in experience.

As I have mentioned many times in previous reports, all hires should be done on the best person for the job. This, as we know, is called merit-based recruitment. Added to this is the legitimate question of “can the applicant carry out the assigned duties?”. This is why a position description with “physical requirements” section is best practice. I would also recommend pre-employment medicals, so that a qualified medico can ascertain whether the applicant can carry out the “inherent requirements of the position”.

Reverse onus of proof

In these cases, the respondent must prove it did nothing wrong; as opposed to the applicant having to prove their case. This is known as the “reverse onus of proof”. However, this does not mean that the applicant holds no culpability, they must have an arguable case in the fist instance.

HR under the microscope (yet again)

The client’s HR Manager was named (and shamed?) through the proof of email exchanges with the labour-hire firm. In particular it was the client’s observation to the labour-hire firm that alerted it to the fact that the short-listed job candidate was 70-years-of-age.

It from this “observation” that it was determined that the job candidate was too old to work in the extreme weather conditions of the Pilbara region. The labour-hire employee stating:

“I would be concerned about employing somebody working 12 hours a day in the Pilbara, 45 degree heat every day.  It knocks me around and I am less than 60. So, having somebody that is 70, it has got to knock them around a lot more than me. That would be my concern.  It has got nothing to do with age”.

Refusing to employ (legalise)

The FCA also considered:

“It is necessary to consider the expression ‘refuse to employ’ in context. Its immediate context is one in which two aspects of an employer’s conduct are identified in the prefatory words in s 334(2) [of the Industrial Relations Act 1988 (Cth) – now relevantly s 342(1)(Item 2)].  The expression ‘refuse to employ’ identifies the first.  The remainder of the prefatory words identify the second.  They concern conduct where an offer is made to employ a person on discriminatory terms. It is relatively clear, in my opinion, that the second aspect concerns conduct where an employer intends to employ someone, the person is offered employment and the employer does so on discriminatory terms. It concerns actual and not theoretical employment. That is, employment by an employer to perform work for the employer albeit on discriminatory terms or conditions. Thus the companion words to the expression ‘refuse to employ’ concern actual employment and they constitute a fairly compelling pointer of the subject matter Parliament intended to address in s 334(2). They indicate that the expression ‘refuse to employ’ deals with the same subject matter, that is, actual employment where there is a refusal to employ a person in circumstances where, apart from the refusal, employment might or would arise. I refer to situations where employment might arise to allow for circumstances where a vacant position exists and a refusal to employ arises before the employer has ascertained whether the person applying for the job or position, who is victimised for a prescribed reason, is qualified or equipped to do the job”.

In Stephens v Australian Postal Corporation Flick J considered this line of authority, observing as follows:

“[21]      Lurking behind the phrase ‘refusal to employ’ are questions as to whether the phrase means:

  • a refusal to employ a person to a position which is in fact vacant – in which case, it may be the prospective employee who has the onus of proving that a position is vacant; or
  • a failure to employ a person upon an application being made, whether or not a position has been advertised as being vacant and (perhaps) even where there is known to be no vacant position – in which case, s 361 would transfer the onus to the employer to explain the reason why the application was unsuccessful.

Even on such a simple approach to the analysis of the phrase, a further variant may be:

  • if a position was once vacant, but is no longer vacant, the reason why a vacancy no longer exists – in which case, the onus may be upon the employer to explain why the vacancy no longer exists”.

There was a vacancy in this case

The learned judge finding:

“CoreStaff’s argument that there was no vacancy is based on an artificial demarcation between the limited task of referring applications to a client and the broader recruitment process clearly envisaged and understood by Mr Ingram. I do not accept its argument or that there was no vacancy in this case having regard to six reasons.

“First,…in my view there is no question that it was the intention of the parties that CoreStaff would employ a person to perform the grader operator role on assignment to Gumala. There was a vacancy for that role. To the extent CoreStaff purported to maintain an argument that Gumala was to be the employer (a submission that was made from time to time during the hearing), it is inconsistent with the evidence, as already addressed.

“Second, although it may be possible to view the recruitment process as involving various stages – such as identifying potential candidates through advertising or otherwise, referral of applications to the client for feedback, approval by the client, consideration by CoreStaff and employment by CoreStaff – it is artificial to treat those stages as subject to separate agreements.  All form part of the one recruitment agreement. Mr Ingram’s evidence is consistent with this understanding of the agreement between the parties and there is nothing in the evidence assessed above that establishes a contrary position.

“Third, the position propounded by CoreStaff permits a construct: it endorses a purported nomination and deferral by parties as to when obligations as an employer might be engaged.  It permits a party to decide that an applicant is to be refused employment for a prohibited reason whilst denying that it is a prospective employer, having decided by private arrangement that a recruitment company (or other third party) will be the employer. It provides for a selection process (and a rejection process) without the safeguards (and obligations) of s 351 of the FW Act.  This potential for a construct is avoided once it is properly understood that the process of identifying candidates and referring them to Gumala is undertaken by CoreStaff as a prospective employer, regardless of whether the vacancy is in fact filled by a suitable candidate.

“Fourth, and having particular regard to the potential for a construct or contrivance, the arrangement between CoreStaff and Gumala is to be viewed in the context of the objects of Part 3‑1 of the FW Act as set out in s 336.  The provisions of Part 3‑1 are for the benefit of employees and are protective and remedial in nature.  They should be interpreted in a way that achieves the FW Act’s beneficial purposes: Construction, Forestry, Mining and Energy Union v Pilbara Iron Company (Services) Pty Ltd (No 3) [2012] FCA 697 at [35]; and Construction, Forestry, Mining and Energy Union v Endeavour Coal Pty Ltd [2015] FCAFC 76; (2015) 231 FCR 150 at [180]‑[181]. Protection from discrimination is a feature of the FWAct and the consideration of when and whether there is a prospective employer with a vacancy proceeds in that context. The segmented approach to recruitment propounded by CoreStaff is not consistent with the objects of the FW Act.

“Fifth, the vacancy did not evaporate when Mr Selsmark was refused employment. The vacancy for the role remained and further resumes were submitted by Mr Ingram.

“Sixth, it is not to the point that CoreStaff did not have exclusivity and that other labour hire companies could have potentially employed Mr Selsmark, or that Gumala might have separately considered a direct hire of Mr Selsmark. That potential does not alter the fact that, because of its arrangement with Gumala, CoreStaff had a vacancy for a grader operation at the relevant time”.

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Overview

This decision goes against the doctrine that if an employee continues to work for an employer under changed circumstances, then the affected employee has an “implied” acceptance to the changes…or does it? Each and every HR person should read this report as it is fundamental to the contract of employment.

Introduction

The Federal Court hearing an appeal from a decision of the magistrates’ court contemplates whether the reduction of an employee’s hours of work constitutes a bona fide redundancy. Each and every HR person should read this report as it is fundamental to the contract of employment.

Background

This was an appeal by the employer against a ruling of the magistrates’ court, where an employee’s union argued that the reduction to an employee’s hour of work was tantamount to redundancy for the purposes of the Fair Work Act 2009.

The union “won” this case and the employer appealed to the federal court and lost, again.

Not relevant, but to give context is the fact that the company was a cleaning business and the employee a cleaner.

The cleaner had been employed since 1 May 2014 as a full-time cleaner by the company.

Due to circumstances beyond the company’s control, the company decided to reduce the employee’s hours to from 38 hours a week to 20 hours a week, with a corresponding loss of earning of some 40 percent.

Whilst refusing to sign an amended contract of employment, the employee began working the reduced hours on 12 September 2017 because she considered she had no choice.

In the magistrates’ court, the magistrate upheld the Union’s claims, awarded the cleaner $5,194.98 in redundancy pay, with interest fixed at $502.56, and ordered the employer to pay the Union a civil penalty of $1,500.

The employer’s argument

The employer contended that the magistrate’s decision was based on an incorrect interpretation of the Act, arguing that the employee was not entitled to redundancy pay because the employment relationship continued after the termination of the contract and termination of a contract of employment at the employer’s initiative is not enough to generate an entitlement to redundancy.

The magistrate did not accept that there had been a variation of the full-time contract, her Honour found that the employer had repudiated [retracted] the contract and the employee accepted the repudiation.

The focus of the employer’s argument was on the distinction between the termination of the employment relationship and the employment contract. The employer submitted that the magistrate erred by relying on the fact that s 119 fails to refer expressly to the employment relationship as a reason for construing the phrase “employment is terminated” to include the employment contract.

The legal parameters

Subsection 119(1) of the Fair Work Act 2009 (Cth) (FW Act) provides that:

An employee is entitled to be paid redundancy pay by the employer if the employee’s employment is terminated:

(a)          at the employer’s initiative because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour; or

(b)          because of the insolvency or bankruptcy of the employer.

“Dismissed” is defined in s 386 of the Act. It relevantly provides that:

A person has been dismissed if:

(a)          the person’s employment with his or her employer has been terminated on the employer’s initiative; or

(b)          the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.

However, a person has not been dismissed if:

(c)           the person was demoted in employment but:

(i)            the demotion does not involve a significant reduction in his or her remuneration or duties; and

(ii)           he or she remains employed with the employer that effected the demotion.

The common law

Citing a number of judgments, the judge in this matter quoted:

“[A] person’s employment cannot be divorced from the contract of employment which governs it. This is so even if the employment and the contract terminate at different times, for instance in circumstances where, although the employment has ended following a dismissal, the contract remains on foot because the employer’s repudiatory conduct has not been accepted: Visscher v Giudice (2009) 239 CLR 361.

Because the terms of a person’s employment are determined by the related contract of employment, to identify whether the employment of a person such as Mr Jovic has been terminated and replaced with another employment or continued according to amended terms depends on the contractual terms applicable to that employment.

The reasons for the employer’s actions are not relevant to this aspect of the analysis”.

What is redundancy?

Putting to one side the exception for the ordinary and customary turnover of labour, which is irrelevant in this case, para 119(1)(a) erects an entitlement to redundancy pay on the happening of two causally connected events:

  • One is the termination of the employee’s employment at the employer’s initiative.
  • The other is the termination of the employee’s employment because the employer no longer requires the job done by the employee to be done by anyone.

The Union argued that the phrase “employment is terminated” is not to be construed in isolation from the words around them. Drawing on Amcor Limited v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241 at [44] (Gummow, Hayne and Heydon JJ), it submitted that the entitlement to redundancy pay created by para 119(1)(a) depends on the job becoming redundant and not on the employee being surplus to the employer’s requirements.

Put simply, when looking at your workforce as a whole, you determine which jobs you need and those you do not (and, naturally, the opposite also applies). Of secondary determination is which people are surplus to requirements, and this is where it tricky, as it is not a as simple of saying “that person occupies the surplus position, then it is that person who must go.

But the entitlement to redundancy pay in this matter does not only depend on the job being surplus to the employer’s requirements. It also depends on the employment having been terminated on that account. Both questions must be answered in the employee’s favour before she is eligible for redundancy pay. As Judge Cameron put it in FL Press at [230]:

“the reason for the termination should not distract from the question of termination”. Where, as here, it was common ground that the job the employee was doing was redundant, the only question was whether the employee’s employment had been terminated”.

Ambiguity

The judge in this matter finding that the phrase “employment is terminated” is ambiguous. According to the judge:

“It could refer to the employment relationship, to the employment contract, to both, or to the termination of employment in the job which the employer no longer requires done. Thus, to discern its meaning it is necessary to consider a number of contextual matters, including the context in which it is used in the section”.

The employer relied on some of the meanings derived from the Macquarie Dictionary, but not others, which the judge picked up on, as those other meanings went to the union’s favour.

Employment not defined in the FWA

Not only is “employment” not defined in the FW Act, but neither is the phrase “employment is terminated”. The judge noting that:

“It appears four times in the Act: in subs 119(1), 123(1), 772(2), and 789(1). Paragraph 123(1)(b) excludes an employee whose employment is terminated because of serious misconduct from the right to receive notice of termination or payment in lieu. Paragraph “772(2)(b) carves out an exception to para 772(1)(f), which prohibits an employer from terminating an employee’s employment on the basis of ‘race, colour, sex, sexual orientation, age, physical or mental disability, marital status, family or carer’s responsibilities, pregnancy, religion, political opinion, national extraction or social origin’. That exception operates where ‘the person is a member of the staff of an institution that is conducted in accordance with the doctrines, tenets, beliefs or teachings of a particular religion or creed’ and the ‘employment is terminated’ in good faith and to avoid injury to the religious susceptibilities of adherents of that religion or creed. Paragraph 789(1)(b) excludes the requirements for notification and consultation in Pt 6-4 Div 3 of the FW Act in relation to such an employee. The phrase also appears in a note to s 768BM, which cross-references s 119”.

However, the judge concluded that none of these references assists in resolving the question of interpretation in this case. The phrase “termination of employment” appears more frequently but likewise nothing in those provisions is of assistance, stating:

“Importantly, I was not taken to any authorities on the meaning of ‘employment’ or ‘termination of employment’ in any of these provisions”.

The legislative history

The history of the legislative entitlement to redundancy pay begins with two decisions of the Australian Conciliation and Arbitration Commission (C&A Commission): Termination, Change and Redundancy Case (1984) 8 IR 34 (TCR No 1) and Termination, Change and Redundancy Case (1984) 9 IR 115 (TCR No 2) (the TCR case). The TCR case was a test case brought by the Australian Council of Trade Unions. As a result of the TCR case, federal (and later most state) awards were varied to include a standard set of redundancy provisions.

The object of this was “to give effect or give further effect to” the ILO Convention (No. 158) concerning Termination of Employment at the Initiative of the Employer, done at Geneva on 22 June 1982, and entered into force for Australia on 26 February 1994.

Further, in TCR No 1, the C&A Commission took the view that the payment of redundancy (or severance) pay was justifiable “as compensation for non-transferable credits and the inconvenience and hardship imposed on employees” (at 71). In doing so, the C&A Commission adopted two of three conclusions reached by the Committee of Inquiry into Technological Change in Australia 1980 (CITCA Committee) as to the elements of monetary compensation for retrenchment. They were set out at 72–73 of the decision:

  • compensation for non-transferable ‘credits’ that have been built up, such as: accrued benefits like sick leave and long service leave; loss of seniority; and loss of the employer’s contribution to pension or superannuation.
  • compensation for the inconvenience or hardship imposed and assistance to the retrenched employee to make the change, with aims such as: to act as temporary income maintenance while the retrenched employee searches for another job; and to allow for the possibility of retraining or relocation to take up a new job.

In TCR No 2, the Full Bench sat again to consider an amendment to the Metal Industry Award 1984 to reflect its decision and, after hearing further argument, determined (at 135) to include a provision in these terms in the amendment:

“An employer, in a particular redundancy case, may make application to the Commission to have the general severance pay prescription varied if he/she obtains acceptable alternative employment for an employee”.

The current legislation

The judge found it abundantly clear that the terms of s 119 derive from the relevant part of the standard clause developed by the C&A Commission for inclusion in federal awards. That clause distinguished between an employee who was transferred to lower paid duties by reason of redundancy and an employee whose employment was terminated for that reason:

#.1 Definition  

Redundancy occurs when an employer decides that the employer no longer wishes the job the employee has been doing to be done by anyone and this is not due to the ordinary and customary turnover of labour.

#.2 Transfer to lower paid duties  

Where an employee is transferred to lower paid duties by reason of redundancy the same period of notice must be given as the employee would have been entitled to if the employment had been terminated and the employer may at the employer’s option, make payment in lieu thereof of an amount equal to the difference between the former ordinary rate of pay and the new ordinary time rate for the number of weeks of notice still owing.

#.3 Severance pay  

#.3.1 In addition to the period of notice prescribed for ordinary termination in clause ? – Termination of employment, an employee whose employment is terminated by reason of redundancy must be paid, subject to further order of the Commission, the following amount of severance pay in respect of a continuous period of service:

The FW Act does not state that its intention was to codify established minimum terms and conditions of employment. Clause r.82 of the regulatory analysis incorporated in the Explanatory Memorandum to the Fair Work Bill 2008 (Cth) (FW Bill) states:

“The NES will provide for written notice of termination and redundancy pay. These are currently awards-based entitlements, which will be legislated to provide more comprehensive protection for employees and extend redundancy pay to award-free employees”.

Beyond this, there is no indication that the Parliament intended to extend the entitlement to redundancy pay, according to the judge.

So what about the legislative purpose of the FWA?

The object of the FW Act is described in s3 as follows:

The object of this Act is to provide a balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians by:

(a)          providing workplace relations laws that are fair to working Australians, are flexible for businesses, promote productivity and economic growth for Australia’s future economic prosperity and take into account Australia’s international labour obligations; and

(b)          ensuring a guaranteed safety net of fair, relevant and enforceable minimum terms and conditions through the National Employment Standards, modern awards and national minimum wage orders; and

(c)           ensuring that the guaranteed safety net of fair, relevant and enforceable minimum wages and conditions can no longer be undermined by the making of statutory individual employment agreements of any kind given that such agreements can never be part of a fair workplace relations system; and

(d)          assisting employees to balance their work and family responsibilities by providing for flexible working arrangements; and

(e)          enabling fairness and representation at work and the prevention of discrimination by recognising the right to freedom of association and the right to be represented, protecting against unfair treatment and discrimination, providing accessible and effective procedures to resolve grievances and disputes and providing effective compliance mechanisms; and

(f)           achieving productivity and fairness through an emphasis on enterprise‑level collective bargaining underpinned by simple good faith bargaining obligations and clear rules governing industrial action; and

(g)          acknowledging the special circumstances of small and medium‑sized businesses.

In Spotless at [37]–[41] Colvin J made the following observations about the legislative purpose of s119(1):

“37         First, the Act is to provide a safety net of minimum terms and conditions of employment that cannot be undermined.

“38         Second, the Act is not expressed as a reform that removes or reduces minimum terms and conditions of employment afforded by the law as it existed at the time of enactment. Nor is it expressed as a codification or improvement of existing minimum standards. Rather, its object is to ensure ‘fair, relevant and enforceable’ minimum terms and conditions. Save that there might be said to be unfairness to employees in a general sense if minimum standards were reduced by the Act (such as by confining the circumstances in which there may be an entitlement to redundancy pay), it is difficult to discern any specific object concerning the relativity between minimum standards as they existed before the Act was enacted and those expressed through the Standards. Nevertheless, it would appear to be unlikely that the Act would deploy established terminology in the field of industrial law concerning an established standard as to particular workplace conditions (such as redundancy pay) where it was intended to change the standard. A purpose of establishing minimum terms and conditions may be expected to be advanced by using existing terminology where such conditions were to be adopted by the Act.

“39         Third, the Act has detailed provisions that provide for compliance and enforcement and establishes a Fair Work Ombudsman and a Fair Work Commission with substantial powers to supervise compliance and ensure enforcement of the Standards. The rights and protections afforded by the Act do not depend upon the employee independently resorting to claims. The Act puts in place a substantial structure to support the making of claims. Nevertheless, the Fair Work Act confers statutory entitlements upon employees that cannot be undermined and to that extent is protective of the interests of employees. It would be contrary to this purpose if a particular condition was interpreted in a manner that, in effect, conferred power upon an employer by adopting a particular business practice to decide whether its employees would receive the benefit of a particular minimum entitlement (such as redundancy pay).

“40         Fourth, the Act has objects that include the promotion of productivity and economic growth and flexibility for business. An interpretation that inhibited the ability of a business to adopt employment practices that best suited the nature of its business activities would be inconsistent with this object.

“41         Fifth, the terms of Division 11 manifest an intention to provide a qualified right to redundancy pay. It is qualified by the presently contentious language in s 119(1)(a). It is also qualified by the exclusions expressed in s 121 (employees for less than 12 months and employees of small business and those the subject of a modern award with specific provisions). Importantly, it is further qualified because Division 11 does not apply to the employees described in s 123. They include employees ‘employed for a specified period of time, for a specified task, or for the duration of a specified season’, employees terminated for misconduct and casual employees.”

The employment relationship is “inherently” a contractual one

The employment relationship is “inherently” a contractual one. Consequently, there can be no employment relationship without a contract of employment. As McHugh and Gummow JJ observed in Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at 436:

“The evolution in the common law as to the relationship of employment has been seen as a classic illustration of the shift from status (that of master and servant) to that of contract (between employer and employee)”.

Nevertheless, there is a difference between the employment relationship and the contract of employment. A contract of employment can come into existence before the employment relationship is formed and an employer who withdraws an offer of employment after it has been accepted or an employee who resigns before the starting date can be liable for breach of contract. Furthermore, a contract of employment can include obligations, such as a restraint of trade covenant, which continue after the employment relationship has come to an end.

There is also a conceptual difference between the termination of an employment relationship and the discharge of a contract of employment.

The judge finding:

“The central flaw in [the employer’s] argument is that it proceeded on the false premise that the employment relationship survived the termination of the employment contract”.

Quoting from the 8th edition of Macken’s Law of Employment, the judge noted:

“The employer-employee relationship will also end when the contract of employment ends, if that relationship has not ended earlier. The possibility of the contract of employment existing after the employment relationship has ended seems established, although ordinarily it will be of ‘no real significance’”.

The judge adding the statement of principle is well-supported. In Byrne:

“It does not appear to have been doubted in this country that a wrongful dismissal terminates the employment relationship notwithstanding that the contract of employment may continue until the employee accepts the repudiation constituted by the wrongful dismissal and puts an end to the contract…”

In both Visscher (at [53]) and Byrne (at 427) reference was made to the statements of Latham CJ in Automatic Fire Sprinklers Pty Ltd v Watson (1946) 72 CLR 435 at 454 that “[a]n employer terminates the employment of a servant when he dismisses him …” and Dixon J in the same case at 469 that “[t]here is nothing in the general law preventing the wrongful dismissal of a servant operating to discharge him from service, notwithstanding that he declines to accept the dismissal as absolving him from further performance but keeps the contract open and remains ready and willing to serve”. In Visscher (at [54]) reference was also made to the statement by Latham CJ in Automatic Fire Sprinklers Pty Ltd v Watson at 451 that:

“[T]he wrongful dismissal determines the relationship of master and servant created by the contract, even though the servant may not have accepted his dismissal as entitling him to regard the contract as discharged”.

History of the Visscher case

Visscher began as a claim for reinstatement in the Australian Industrial Relations Commission. Mr Visscher commenced employment with the respondent shipping company (Teekay) in March 2000. He began as a casual employee but soon afterwards accepted an offer of permanent employment as a Third Mate. Within months he was promoted to Chief Officer but Teekay wrote to him declaring that it would no longer be bound by its legal obligations. Nevertheless, Mr Visscher continued in its employment working as a Chief Officer, although Teekay considered he had returned to his original position as Third Mate albeit that his duties and remuneration did not change. In the Full Court, held that Mr Visscher could not insist on performance of his contract, even if the contract itself remained on foot for limited purposes. His Honour went on to say at [50] that the fact that Mr Visscher remained in employment with Teekay and sailed as Chief Officer did not lead to a different conclusion. His Honour considered that Mr Visscher continued under a new contract, in his original position of permanent Third Mate.

In the High Court the majority said that Buchanan J had elided the concepts of termination of an employment relationship and the discharge of a contract of employment: Visscher at [53]. Their Honours explained that it does not follow from the fact that a wrongful dismissal is effective to bring the employment relationship to an end that the contract is thereby discharged. At [56] they said that the case did not involve dismissal with a consequent destruction of the employment relationship. It was accepted that the employment relationship continued after the repudiation. But Visscher was a very unusual case. As the majority observed at [57], it was a feature of the case that “the employment relationship continued with Mr Visscher undertaking the duties of a Chief Officer and being remunerated to the same extent”.

Visscher v the current case

Here, in contrast to Visscher, there was, in effect, a wrongful dismissal constituted by the employer’s repudiation of the employment contract, which brought the employment relationship to an end. The relationship in which the employee entered after she accepted the repudiation was a fundamentally different relationship from the relationship the parties previously enjoyed. She was no longer a full-time employee but a part-time employee, performing a fraction of the work she formerly undertook for a fraction of the remuneration she formerly received. The judge adding:

“Even if I am wrong in this respect, I do not accept that what happened to [the employee] was not a termination of her employment within the meaning of the FW Act”.

The judge then digging deeper into history:

“What occurred in the present case appears to have been within the contemplation of the Convention. Paragraph 22 of the 1995 General Survey of the International Labour Office entitled “Protection against Unjustified Dismissal”, to which the Full Court referred at 103–4 of its reasons, relevantly stated:

‘Certain changes introduced by the employer, in particular as concerns conditions of employment and which do not arise out of genuine operational requirements, might place the worker under pressure either to accept such changes or to give up his job or incur the risk of being sanctioned for having disregarded the employer’s instructions. It is therefore necessary to be able to verify whether a situation does not constitute a disguised dismissal or a real termination of the relationship instigated by the employer in the sense of the Convention, since otherwise the worker concerned would de facto or de jure be unduly deprived of the protection provided by the Convention’”.

What is termination of employment?

In Siagian, to which the Full Court in Mohazab referred, Wilcox CJ said that it was “preferable to the treat the words ‘termination of … employment’ in Div 3 of the Part VIA of the [IR Act] as including any act that brings to an end the employer-employee relationship, whether or not the act, or any acceptance of it, also brings to an end the contract of employment”.

Conclusion

The judge concluding:

“For all these reasons I am satisfied that [the employee’s] employment was terminated when [the employer] repudiated her contract of employment as a full-time cleaner. Since it is common ground that the reason for the termination was that [the employer] no longer required that job to be done by anyone, she was entitled to redundancy pay…[and] it follows that the appeal must be dismissed”.

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Introduction

Case: Appleroth v Ferrari Australasia Pty Limited [2020] FCA 756.

A person makes a General Protections application to the Fair Work Commission, and then later withdraws the application. The media smell a juicy story and seek to attain the material filed with the FWC by seeking an order for its release to the Federal Court.

This is a matter that deals with the issue of “open justice” and confidentiality.

This case also serves as cautionary tale, when apply for or defending a legal matter: does the relief sought outweigh your public reputation?

Background

The person who made the application and subsequently withdrew it in the FWC sought from the Federal Court to respect his confidentiality in that the documentation relating to the application is not made publicly available. Fairfax Media disagreed and sought that the Court release the information in interests of “open justice”.

In what must have been a very interesting news story, the court heard the matter it listed the matter at the earliest possible time.

A former employee of the respondent whose employment was terminated which led to the Protected Action application in the FWC, concerned “certain allegations” that his former employer levelled against him. Reasons that were said to justify his dismissal. Whilst not revealing the allegations, the court said:

“…it suffices to note that some of them were of a personal nature, involving a relationship to which [the former employee] was party and his conduct toward the other party to that relationship. Also raised within the confines of his proceeding was information concerning [the former employee’s] remuneration”.

As summarised by the Court, the former employee contends that the particulars of the allegations that are summarised above are not known outside of his former employer and some of its employees. Having reflected upon its potential ramifications, the former employee has been led to conclude that it was not in his or his family’s best interests that the proceeding continue. His decision to discontinue it was, at least in part, animated by a desire to avoid media speculation. Notwithstanding its discontinuance, there has remained some media interest in accessing documents that have been filed with the court.

Confidentiality is discretionary

The court’s power to grant relief in the nature of the orders that are sought is not in question. Relief of that nature is discretionary. That discretion must be exercised judicially. Doing so requires that the court take account of the matters that incline in favour of the orders that the documents filed to date remain beyond public reach; and that those matters be weighed against others that incline the other way.

The former employee’s argument

The former employee argued that under the Court’s rules, the court’s discretion to make an order of the kind sought are similar to—but not wholly aligned with—those that inform the making of non-publication orders and suppression orders under the Federal Court of Australia Act 1976 (Cth), if it considers that there is good reason to do so. citing Central Equity Ltd v Chua [1999] FCA 1067, [20] (Weinberg J). He submitted that the circumstances that prevail presently warrant that outcome because:

  • the detail (or some of the detail) contained within the documents in question is of a personal nature, or is otherwise confidential to him;
  • some of that information concerns other parties, whose privacy and confidences ought to be preserved;
  • the proceeding is no longer extant and was never served on his former employer;
  • The former employee did not have the normal amount of time that litigants typically have before they must commence proceedings to reflect upon whether or not it was in his or his family’s interests to do so; and
  • having discontinued the action, he has now effectively forfeited his rights to vindicate his position (that is to say, to answer the allegations that were levelled against him) in court.

“Open justice”

Fairfax submitted that access to documents was an important manifestation of the principle of open justice and that the circumstances of this case were not sufficient to keep them from the public. Citing R v Davis (1995):

“Whatever their motives in reporting, [the media’s] opportunity to do so arises out of a principle that is fundamental to our society and method of government: except in extraordinary circumstances, the courts of the land are open to the public. This principle arises out of the belief that exposure to public scrutiny is the surest safeguard against any risk of the courts abusing their considerable powers. As few members of the public have the time, or even the inclination, to attend courts in person, in a practical sense this principle demands that the media be free to report what goes on in them”.

The court noting that it is only in exceptional and special cases that courts are entitled to exclude public access to the processes with which they deal (citation omitted):

“It has often been acknowledged that an unfortunate incident of the open administration of justice is that embarrassing, damaging and even dangerous facts occasionally come to light. Such considerations have never been regarded as a reason for the closure of courts, or the issue of suppression orders in their various alternative forms…A significant reason for adhering to a stringent principle, despite sympathy for those who suffer embarrassment, invasions of privacy or even damage by publicity of their proceedings is that such interests must be sacrificed to the greater public interest in adhering to an open system of justice. Otherwise, powerful litigants may come to think that they can extract from courts or prosecuting authorities protection greater than that enjoyed by ordinary parties whose problems come before the courts and may be openly reported”. [Emphasis added].

And in another matter, citing:

“…it is an inevitable feature of litigation in open court that persons who are mentioned in passing may suffer embarrassment and distress. But that is a price the community has to pay for the undoubted benefit of court proceedings being, except in very exceptional circumstances, conducted in public”.

Former employee seeks to shield himself

For reasons that might readily be understood, the former employee seeks to shield himself and others from the potential distress and embarrassment that public consumption of his short-lived suit against his former employer might occasion. Although not unmoved by the former employee’s circumstances, the court did not consider that the former employee’s circumstances amounted to reason enough to depart from the foundational principle of open justice.

Open justice trumps confidentiality

The court, in this case, was not persuaded that it is appropriate to suppress the information and so granted Fairfax access to the documentation.

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 Introduction

Case: Australian Building & Construction Commissioner v Molina (No 2) [2019] FCA 1014

Can the threat of an adverse action be in breach of the General Protects provisions of the Fair Work Act? The Full Bench of the Federal Court says no and leaves the door open for the Australian Building & Construction Commissioner to pay the union’s costs.

The Australian Building & Construction Commissioner (ABCC) takes the matter to the Federal Court and loses. It then appeals to the Full Court…and fails (again).

Background

Following the death of a worker on a building site a CFMMEU organiser addressed the workers at the site. The union’s organiser called a meeting of the site’s 500 workers and called for a minute’s silence as “a sign of respect for the fallen worker”. A number of workers spoke at the meeting and stated that the site should close for 24 hours out of respect for the deceased worker. There was a vote by a show of hands and the union organiser proclaimed the result as a vote to leave the site.

The union organiser put this to the meeting and about 30% of workers “trickled” off the site.

[Ed: In years gone past the site would have been shut down by the union – no exceptions].

The company’s site representative then called a meeting, declaring the site “open”, ie the workers should continue their duties.

The company representative and the union organiser then had an exchange:

Union organiser: “You need to send your guys home. Have some respect, send your guys home.”

Company representative responded by saying that the union organiser knew he could not do that.

Union organiser: “If you don’t send your guys home, you can expect a picket line on Monday – if you send your guys back up to work”.

Storm in a teacup?

The company representative did not take the conversation personally and did not get upset about the conversation. He was not threatened or concerned by what had been said and he continued to keep his workers on the site for another two hours or so. Eventually, the workers left the Site because crane drivers were not working. In the result, workers returned to the Site the next day and there was no picket line arranged at the Site the following Monday.

Prosecution

In the above circumstances, proceedings were brought by the (ABCC) against the union’s organiser and the Union alleging two contraventions under the Fair Work Act 2009 (Cth), namely that:

  1. contrary to s 346(b), they threatened to take adverse action against Civmec (being arranging a picket line at the Stadium site) because Civmec did not comply with a lawful request by the Union (being to send its workers home as a sign of respect) (adverse action claim); and
  2. contrary to s 348, they threatened to take action against Civmec (being arranging a picket line at the Stadium site) with intent to coerce Civmec to comply with a lawful request by the Union (being to send its workers home as a sign of respect) (coercion claim).

The first case (fail)

The primary judge found that there had been a threat to put a picket line in place, but determined there had been no threat of adverse action in contravention of s 346 because it had not been proved that there could have been prejudice to Civmec if there had been a picket line. The primary judge also found that intent to coerce had not been established and for that reason there was no contravention of s 348. In reaching the latter conclusion the primary judge found that the statutory presumption expressed in s 361 of the Fair Work Act (to the effect that action alleged to be taken with a particular intent was presumed to be taken with that intent unless proved otherwise) did not apply.

As a result, the proceedings were dismissed. The ABCC the appealed.

The issues in the appeal

In the appeal, the ABCC raises three issues (including an alternative argument as to the third). A significant part of the answer raised by the respondents to the appeal is that the ABCC now seeks to depart from the way it presented its case to the primary judge. The competing positions of the parties on the three issues are as follows:

  • First, on the adverse action claim, the ABCC says that the primary judge erred by requiring it to establish objectively that the threat, if implemented, would have had the effect of prejudicing Civmec. The ABCC says that the correct approach was to ask whether prejudice to Civmec was threatened by what was said. It says that if that approach had been adopted then, on the findings of the primary judge, the contravention of s 346 was established.
  • The second issue concerns the coercion claim. The ABCC says that the statutory presumption in s 361 applies and the primary judge erred by finding it did not apply. The ABCC says that if the presumption applies then the contravention of s 361 was established because the ABCC’s version of events was accepted and the burden imposed by s 361 was not discharged by the union’s organiser or the Union.
  • The third issue also concerns the coercion claim. The ABCC says that on the proper construction of s 348 there is no requirement that the coercion must negate any choice by means of an action that is unlawful, illegitimate or unconscionable and the many authorities to that effect are wrong. It says that if the primary judge had applied what it contends to be the proper approach then the contravention of s 348 was established on the findings by the primary judge. It accepts that it ran the case before the primary judge on the basis that there was a requirement that coercion involves negating any choice by an action that is unlawful, illegitimate or unconscionable. However, it says that there is no respect in which the case below might have been run differently if that requirement did not apply. In the alternative, the ABCC says that if the coercion must be by action that is unlawful, illegitimate or unconscionable then the primary judge erred in not finding that to be the case.

Full Court findings

Section 346 provides, relevantly for present purposes, that a person “must not take adverse action against another person because the other person … does not engage … in industrial activity”. The meaning of the phrase “engages in industrial activity” is defined in s 347. Amongst other things, it is defined to include an instance where a person does not comply with a lawful request made by an industrial association.

So, a person must not take adverse action against another person because that person does not comply with a lawful request made by an industrial association.

First, the Court found, a threat to take action will be adverse action if it is a threat to bring about the effect of prejudicing an independent contractor in relation to a contract for services. On such an approach, the effect must form part of that which is threatened.

Second, if that were the way the provision operated then it would be necessary to consider what will often be an hypothetical either because the threat has the desired effect and it does not need to be carried out or the threat is ineffective but, for some reason, the threat is not implemented. Further, on the second construction, issues may arise as to the degree of likelihood of the threatened conduct having the required effect that is sufficient to establish a contravention.

The third possibility is that a threat will be adverse action if it is intended to have the consequence of prejudicing an independent contractor in relation to a contract for services. On such an approach the party making the threat must be shown to have intended the effect. This third alternative can be readily discounted because it sits inconsistently with the ordinary meaning of a threat. The expression of an intention to do harm is a threat.

The threat must be real?

Therefore, the feasible alternative constructions appear to be the first and the second. In many instances, the distinction between them may not be of great significance because a threat is likely to be made with a particular consequence being both part of the threat (expressly or impliedly) and plainly in view. However, the second alternative would open up the possibility that an effect that was not within the purview of the threatening party might give rise to a contravention. It would attribute to the threatening party a responsibility for likely effects that may not have been in the party’s contemplation when making the threat (and in that sense were not threatened by that party). Such a construction would be inconsistent with the ordinary meaning of a threat which is to engender fear by conduct that, viewed objectively, conveys an intention to do something that would be harmful from the perspective of the person being threatened. In ordinary parlance, a threat identifies the harm that is threatened.

Conclusion

On my reading, to be upheld, the ABBC would need to provide that the union had intended to carry out the adverse action, and that there was “fear” involved.

It will be interesting to see if the union pursues costs, as the ABCC has been relentless in past dealings with this union.

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Introduction

Case: Lamont v University of Queensland (No 2) [2020] FCA 720

Allegations by the applicant of ongoing harassment and bullying, and the what he perceived to be similar conduct by his employer had led to multiple resignations, a heart attack and a suicide. And the importance of separating your policies from your contractual terms.

This judgment responds to some 41 allegations by the applicant. This article focuses on just two:

  • What “injures” an employee for exercising a workplace right?
  • Does the threat of disciplinary action constitute an “adverse action”?

This case is of an obsessive, tenacious litigant, who genuinely felt he has 41 chances of a successful outcome. In fact, he had five. This was enough to cause the University untold distress and – even if no further award of damages are given/agreed – the legal costs alone could be more than a small country’s GDP.

The main thread in this case is that Prof X was found to be unprofessional (my words) if the dealing of a complaint from what he probably perceived (my words again) to be a vexatious, troublesome employee. Note the judge’s findings on the applicant’s career.

The takeaway message, therefore, is that no matter how trivial or troublesome an employee may be, always address the substantive issue and, if possible, any underlying issues with dispassion. Focus on the issue not the person. In football parlance this is called “playing the ball, not the man (or woman)”.

Background

This matter involves an unhappy employee who felt that his employer and supervisor had not treated him as he thought he should have been treated. As a result, he filed an “adverse action” claim against his employer and four other university employees – alleging 41 counts of “adverse action”.

Now imagine if this was your business. How would you react?

In what can only be described as having more money than sense, the applicant in this matter certainly had a tonne of tenacity, and the financial ability to be represented by a QC, a solicitor and a legal counsel over 13 days of hearing days alone. The judgement itself is a constrained 160 pages. The judge summed it up best:

“I do not propose to list the allegations made in the pleadings, nor to describe the evidence of the witnesses in narrative form. That is because of the sheer number of allegations made and the scale of the evidence. There are over 6,000 pages of affidavit material, and over 8,000 pages of documents in total. The applicant’s written submissions alone exceed 500 pages, while those of the respondents exceed 300 pages. Many of the affidavits are prolix and replete with barely relevant, repetitive or superfluous material. There were many communications between the protagonists by email, and many of these were verbose and turgid, containing numerous acronyms and phrases decipherable only by academics. In particular, Dr Lamont’s emails tended to flow in a stream of consciousness that makes them difficult to read and understand.

“The parties, particularly the applicant, have made what should have been a fairly straightforward case into one of almost labyrinthine complexity. To illustrate the point, after nine days of evidence, there were two days of closing oral addresses, almost all of which was spent trying to understand the complex structures of the written submissions, while the parties barely touched upon the particular allegations made and the evidence led. I recognise that the respondents were required to respond to the voluminous material filed by the applicant, but even so, the material filed by both parties was excessive”. [My emphasis]

In reporting this judgement, I have only included the context and parts that I found to be instructional. For a more complete analysis, I suggest you , dear reader, read the judgement in full.

The Genesis

This matter kicked off with a grievance by the applicant who made some very unsettling allegations against his employer. He wrote a letter (email), dated 12 April 2010, to Prof X making a complaint against Prof Y under the Staff Grievance Resolution Policy:

“I am writing to you in accordance with Section 4, Step 1 of the University’s 5.70.8 Staff Grievance Resolution. I have attached a copy of a letter dated March 19, 2010 from [a person] to me and a copy of a letter dated April 9, 2010 in reply, from me to [the person]. Although the letters do not give all the background information they are, nevertheless, long and detailed enough to give a clear indication of the matters of my concern. I believe that [the person’s] behaviour towards me, over at least the past 6 months, constitutes harassment.

“As you know our School has a sad history of harassment. Both the previous two Heads of School were sued by staff members for harassment resulting in large out-of-court settlements which cost our School dearly both in terms of reputation and money. Last year, a staff member, [name deleted], resigned, alleging harassment. In addition, we now have a history of one staff member, [name deleted], who was a friend of mine, being terribly stressed by his treatment in the School and dying of a heart attack; and now the tragic case of [Dr XY] committing suicide. All these matters have weighed heavily on my mind in the past, but it was mainly as a result of [Dr XY’s] suicide and the subsequent visit to our School of the Staff Support and Rehabilitation Advisor that I finally decided to seek counselling for harassment from the University’s Employee Assistance Service Provider…These counselling sessions, which have provided me with strategies to cope with harassing behaviour, have also helped me make the decision to bring this matter to your attention.

“My hope is for this situation not to escalate – I have no desire to add to the sad public history of the HPRC School. Congruent with this intention, I am bringing this matter to your attention under “Step 1” and Section 4.1 of the University’s HUPP 5.70.8 Staff Grievance Resolution Policy which states “The aim is to reach an acceptable outcome that minimises any potential detriment to ongoing workplace relationships.” My grievance is that I have been the subject of harassing behaviour by my supervisor [named]. To help you determine whether a genuine grievance exists (under 4.5(1)) I have provided you with the two letters which I believe provide ample evidence of harassing behaviour. I am willing to elaborate further on any of these behaviours and other behaviour not described in the letters, if you would like.

“Given that I am not proceeding under “Step 2” of the Policy, as I understand it, what is required of you is to “determine whether a genuine grievance exists” (4.5(1)). However, if you wish yourself to formally determine whether harassment has occurred under HUPP 1.70.6 please notify me and I would be willing to have the letters used as evidence in that determination and would be willing to provide further evidence if needed. However, if you are proceeding under “Step 1”, which I have initially asked for, it requires that the staff member state “what a preferred outcome might be”. In the spirit of not wanting to escalate this problem further, I need to express to you my preferred outcome. My preferred outcome is that [named] cease harassing me and be replaced as my supervisor with [another named person], who is our Acting Deputy HOS. I have approached [nominated replacement] about this matter and he has agreed to act as my supervisor if formally asked by you. Given that, in the circumstances, it would be completely inappropriate for [name] to conduct my annual appraisal, I ask that [nominated replacement] conduct it or, if he is not currently qualified, for [another person, also named] to do so. It is my hope, through this lowest level of intervention, to inhibit escalation of this situation”. [emphasis added].

The applicant’s letter of complaint attached his email exchange with the named person and the applicant had also written a lengthy email to Prof X complaining about a number of issues.

An angry Prof X shared the email with two other people. This being in breach of the confidentiality requirement of the relevant policy. That set off a chain of further complaints by the applicant.

THE LAW

Workplace right to make a complaint

The workplace rights alleged by the applicant include his right to make complaints within s 341(1)(c) under various enterprise agreements and policies. Citing Shea v TRUenergy Services Pty Ltd (No 6) (2014) 314 ALR 346; [2014] FCA 271, Dodds-Streeton J said at [29], in relation to a “complaint”, the judge noted:

“(a)        a complaint is a communication which, whether expressly or implicitly, as a matter of substance, irrespective of the words used, conveys a grievance, a finding of fault or accusation;

(b)          the grievance, finding of fault or accusation must be genuinely held or considered valid by the complainant;

(c)          the grievance, finding of fault or accusation need not be substantiated, proved or ultimately established, but the exercise of the workplace right constituted by the making of the complaint must be in good faith and for a proper purpose;

(d)          the proper purpose of making a complaint is giving notification of the grievance, accusation or finding of fault so that it may be, at least, received and, where appropriate, investigated or redressed. If a grievance or accusation is communicated in order to achieve some extraneous purpose unrelated to its notification, investigation or redress, it is not a complaint made in good faith for a proper purpose and is not within the ambit of s 341(1)(c)(ii);

(e)          a complaint may be made not only to an external authority or party with the power to enforce or require compliance or redress, but may be made to persons including an employer, or to an investigator appointed by the employer;

(f)           a complaint that an employee is able to make in relation to his or her employment is not at large, but must be founded on a source of entitlement, whether instrumental or otherwise; and

(g)          a complaint is limited to a grievance, finding of fault or accusation that satisfies the criteria in s 341(1)(c)(ii) and does not extend to other grievances merely because they are communicated contemporaneously or in association with the complaint. Nor does a complaint comprehend contemporaneous or associated conduct which is beyond what is reasonable for the communication of the grievance or accusation.

Justice Dodds-Streeton added at [625], in a passage approved in Cigarette & Gift Warehouse Pty Ltd v Whelan (2019) 285 IR 290; [2019] FCAFC 16 at [28] and PIA Mortgage Services Pty Ltd v King [2020] FCAFC 15 at [12]:

“In my opinion, the requirement that the complaint be one that the employee “is able to make” in relation to his or her employment suggests that there are complaints which the employee is not able to make in relation to his or her employment. The ability to make a complaint does not arise simply because the complainant is an employee of the employer. Rather, it must be underpinned by an entitlement or right. The source of such entitlement would include, even if it is not limited to, an instrument, such as a contract of employment, award or legislation”.

Adverse action taken against another person

Under s 342(1) of the FWA, taking “adverse action against another person”, relevantly, consists of an employer:

(a)          dismissing the employee;

(b)          injuring the employee in his or her employment;

(c)           altering the position of the employee to the employee’s prejudice; or

(d)          discriminating between the employee and other employees of the employer.

Injures an employee

The judge finding for this provision to be enacted, the employer must “injure” an employee. The injury must be to the employee “in his or her employment”.

The Macquarie Dictionary defines “injure” as:

  1. to do or cause harm of any kind to; damage; hurt; impair…
  2. to do wrong or injustice to.

The judge then supported this with the authorities seem to have regarded s 342(1) (and its equivalent under s 298K(1)(b) of the WR Act) as taking the first of these meanings, not the second. They have focussed upon whether there is some practical detriment or harm to the employee in his or her employment, and mere unfairness or injustice has not been regarded as enough. That was, for example, the approach in Squires at 164 which required that the treatment must be injurious or prejudicial. In Major v State of South Australia (1999) 140 IR 29; [1999] FCA 1684, where the employer refused an employee who had been seconded to a union a further period of unpaid leave as the employer was entitled to do, Marshall J held that the employee was not injured. In Jones v Queensland Tertiary Admissions Centre Ltd (No 2) (2010) 186 FCR 22 (Jones v QTAC), Collier J held at [121]–[122] that a failure by an employer to accord natural justice is not of itself an injury in employment. [My emphasis].

Summarising:

“…Therefore, it is not enough that an action by an employer is itself wrong or unjust—it must cause some kind of material harm or detriment to the employee”.

Is a formal warning an injury?

In the present case, a question arises as to whether an employee is injured by being given a formal warning following a disciplinary process.

Citing a number of previous decisions by the Federal Court, the Judge found:

“These cases demonstrate that a formal warning may cause a practical detriment to an employee. In my opinion, a practical detriment of that kind may also amount to injury to an employee”.

There is also an issue in the present case as to whether distress, falling short of a psychiatric injury, can be an injury to an employee in his or her employment. One of the contexts in which the issue arises is whether a threat of disciplinary action causes, or can cause, injury.

A recognisable psychiatric illness, according to the judge, clearly comes within the conception of an injury…

I do not think that psychological or emotional distress falling short of a recognisable psychiatric illness is necessarily excluded. A situation can readily be imagined where an employee is bullied and harassed by a supervisor to the point where the employee experiences great distress at work on a daily basis, but that distress does not rise as high as a psychiatric injury. In my opinion, distress falling short of a recognisable psychiatric illness may be regarded as an injury if it causes sufficient harm, damage, hurt or impairment to the employee’s emotional state”. [My emphasis].

Then clarifying:

“However, … not all harm, damage, hurt or impairment to an employee’s feelings can necessarily be regarded as an injury. In my opinion, the word “injury” implies that a minimal level of harm is insufficient. For example, I do not think that a person who experiences physical pain that is slight and fleeting could be said to be injured. In the day to day conduct of any employment relationship, an employer may make decisions and take actions which result in disappointment, upset or reduction in job satisfaction. Some examples include asking an employee to improve their punctuality or performance, requiring an employee to do new or different duties, or requiring an employee to work reasonable overtime. In such a circumstance, it could not necessarily be said that the “employer…injures the employee in his or her employment”. To be described as an “injury”, there must be a sufficient level of harm, damage, hurt or impairment to the employee’s emotional or psychological welfare. A qualitative judgment must be made as to whether the level of emotional distress demonstrated by the evidence amounts to an injury”. [Emphasis added].

So, does disciplinary action count as an “injury”

According to the judge, yes:

“I accept that the taking of disciplinary proceedings can cause injury to an employee because the employee is exposed to the potential of adverse consequences for his or her employment. The employee’s employment may be less secure. Further, a threat to take disciplinary proceedings may amount to an injury because, if the threat is carried out, the employee is exposed to potential adverse consequences. In my opinion, the emotional consequences of such a threat being made or proceedings being taken may also amount to an injury”.

Adding:

“Not every injury that has a relationship with employment is necessarily an injury “in employment”.

Because the person has exercised a workplace right

The judge further examined another case as follows:

  • The central question to be determined is one of fact. It is: “Why was the adverse action taken?”
  • That question is to be answered having regard to all the facts established in the proceeding.
  • The Court is concerned to determine the actual reason or reasons which motivated the decision-maker. The Court is not required to determine whether some proscribed reason had subconsciously influenced the decision-maker. Nor should such an enquiry be made.
  • It will be “extremely difficult to displace the statutory presumption in s 361 if no direct testimony is given by the decision-maker acting on behalf of the employer.”
  • Even if the decision-maker gives evidence that he or she acted solely for non-proscribed reasons other evidence (including contradictory evidence given by the decision-maker) may render such assertions unreliable.
  • If, however, the decision-maker’s testimony is accepted as reliable it will be capable of discharging the burden imposed on the employer by s 361.

The judge then went to a previous matter in which he was involved:

“…that a mere causal nexus between the exercise of a workplace right and the adverse action is not enough…the word “because” in s 340(1) requires an enquiry as to the ‘substantial and operative’ reason or reasons for the relevant action…the enquiry as being into the “operative and immediate” reason or reasons. The mere application of a “but for” test is insufficient…A qualitative judgment must be made as to whether the adverse action was taken because the employee exercised a workplace right”.

Threatening of Disciplinary Action

The tenth allegation is that Prof X, on behalf of the University, threatened disciplinary action against the applicant on 8 July 2010 because he exercised workplace rights.

In his email of 8 July 2010, Prof X threatened that, unless the applicant responded to his letter of 1 July 2010, he would have the applicant investigated for serious misconduct under the University’s Misconduct — Serious Misconduct Policy on the basis of refusing to carry out a lawful and reasonable instruction. The email reads:

Step 1 of the grievance procedure…involves informal attempts to resolve a grievance through, e.g., a meeting with the person concerned…, or an oral discussion with the next most senior officer (me, in this instance). However:

  • you did not seek resolution of the problem directly with the person concerned;
  • you have failed, in spite of several requests, to meet with me to discuss the matter orally nor agreed to allow me to attempt to deal with the matter informally, e.g. through mediation by hosting a meeting between you and [another employee];
  • to my knowledge, at no time have you made any other attempts to resolve the grievance informally;
  • your application to me was formal, in writing, and was followed by a large number of additional written (email) submissions.

I have therefore concluded that…you consider that dealing with this matter under step 1 is not possible or appropriate and that your submissions and subsequent actions indicated that you wished to initiate formal step 2 proceedings. I am therefore proceeding with your complaint as per step 2 of the grievance resolution procedures.

I commenced my investigation on 13 April, the day after receiving your letter, and drafted my findings and advice intending to respond to you within the two week timeline…but was unable to complete the procedure because you began a separate claim that I breached confidentiality in assessing your allegation of grievance. I was obliged to delay completion of my formal response until I was able to establish that I was still the officer authorised to do so. The delay therefore was caused solely by your action.

My response dated 1 July is provisional in that, as I have noted, I am giving you an opportunity to make further submissions on two matters if you wish to do so, and to make amends for the false and damaging allegations you have made against three successive Heads of School.

I require a written response to my letter of 1 July by Friday 16 July. If you fail to do so, I hereby give you advance notice that on Monday 19 July I will send you a formal notice advising you that I intend to initiate an investigation into your actions under…Serious Misconduct as to whether you have refused to carry out a lawful and reasonable instruction in respect of a significant matter

In an email of 9 July 2010 to in-house counsel, Prof X explained the threat he had made as follows:

“I would, of course, not under any circumstances penalise a staff member for lodging a grievance, even if that grievance ultimately failed, provided the complainant entered in good faith into procedures towards resolution of the complaint as is required under the policy. However, failure to respond to a reasonable request to substantiate a grievance, broadening the complaint to include false and damaging allegations about the person complained against and about others, as well as his more general failure to show good faith in trying to resolve the issue by failing to enter into any dialogue or mediation or any communication whatsoever other than his own diatribes, constitute in my view grounds for investigation for serious misconduct”.

The judge finding that Prof X’s email contained a clear implication that he considered that the applicant was committing serious misconduct by failing to comply with a reasonable and lawful direction to respond to his letter of 1 July 2010 and was at risk of being sanctioned, stating:

“The email was calculated to intimidate [the applicant] into complying with Prof [X’s] demand to respond by causing him to fear the consequences for his employment if he did not. The threat to investigate was not significantly different to a threat to take disciplinary action in that regard. [The applicant] feared the consequences for his employment…indicating that the threat had caused him to experience enormous distress, such that he was intending to seek medical advice…the making of the threat aggravated [the applicant’s] psychiatric condition to a minor extent. In my view, the making of the threat caused injury to [the applicant] in his employment”.

The judge went on to reject the validity of Prof X’s reasons for the “threat” stating:

“I do not accept that Prof [X] genuinely thought that [the applicant] was disobeying a lawful and reasonable workplace direction…I consider that Prof [X] correspondence reveals that his view was that [the applicant’s] complaint was spurious and made for ulterior purposes, including bypassing the annual performance appraisal that would otherwise be conducted by the Head of School. His correspondence also reveals that he thought that if [the applicant] could not provide further evidence about his claims, he should withdraw them. His email of 3 June 2010 indicates that he wanted [the applicant] to apologise to Prof [Y] and Associate Prof [Z]. I consider that Prof [X] made the threat in order to intimidate [the applicant] into withdrawing his claims if, as Prof [X] expected, he could not provide further evidence, and to apologise to Prof[‘s Y and Z]. The threat was made because [the applicant] had made his complaint of 12 April 2010″.

In finding that the applicant’s complaint of 12 April 2010 was genuine and that he exercised a workplace right by making his complaint, the judge found the threat to be an adverse action:

“Prof [X], being aware that [the applicant] had made his complaint, made the threat that caused the injury constituting the adverse action. Prof [X] was knowingly concerned in the contravention…”

Duty of confidentiality

The judge formed the impression that the applicant, while acutely sensitive to his own perceived unfair treatment, still lacks insight into the unfairness and seriousness of implying that Prof X contributed to Dr XY’s suicide. Ultimately, the judge finding:

“[The applicant] had a workplace right to make a complaint pursuant to the Staff Grievance Resolution Policy and exercised that right. I find that, even though [the applicant] did not have an adequate basis for making the part of his complaint that implied that Prof [X] had contributed to the suicide of Dr XY, he had a genuine belief in the truth of his complaint. I find that Prof X disclosed the letter of complaint because [the applicant] had exercised his workplace right.”

Confidentiality v Injury

According to the judge, the breaching of the confidentiality did not “injure” the applicant because the fear and stress was not to his employment. In the judge’s words:

“I accept that the threat by Prof [Y] to consider an action for defamation amounted to an “injury”…to [the applicant] because it caused him substantial fear and distress, leading to his apology. However, I do not accept that it was an injury to [applicant], “in his…employment”. As I have said, not every injury that has a connection or relationship with employment is necessarily an injury “in employment”. The threat to consider an action for defamation was certainly connected with his employment because [the applicant] wrote the letter of complaint in his employment and about his employment. However, the fear and distress caused to [the applicant] by the possibility of an action for defamation was because of the financial consequences and stress that litigation would have had on him in his personal life. The evidence does not establish that the threat had any consequences for his employment…”

However, the disclosure of the letter did “injure” the relationship between Prof Y and the applicant, and this, according to the judge amounted to adverse action against the applicant.

Choosing who conducts your performance appraisal

The applicant put that he was “injured” by not being able to choose who conducted his annual performance review. The judge rejected this stating that:

“[The applicant] has not demonstrated that he was injured by either the appointment of [name] as his performance reviewer or any actions taken by [name]. I am satisfied that [name] performed his role dispassionately and competently. There were three categories for the rating of performance levels, “Not applicable”, “Satisfactory” and “Not Satisfactory”. [the applicant] was rated “Satisfactory” in each category of performance. I find that [the applicant] was not injured as he alleges”.

Another matter pertaining to the performance appraisal process was raised by the applicant in that he was directed to remove remarks from the documentation relating to the applicant’s grievances against the university. The applicant was threatened with disciplinary action if he failed to remove the offending words. The judge also rejected this allegation, stating:

“However, I do not accept that Prof Z gave the direction that [the applicant] remove references to the grievances and made the threats to take disciplinary action if he did not, because [the applicant] had exercised any workplace rights. The fact that the direction was to remove references to grievances does not mean that the adverse action was taken because [the applicant] had made those grievances. As I have said, the mere satisfaction of a “but for” test is insufficient. That [the applicant] had made the grievances was not a substantial and operative reason for directing their removal. I find that the direction and the threat to take disciplinary action if he did not comply were made because Prof [Z] considered that it was not productive, appropriate or warranted to allow references in the Form B relating to what [the applicant] considered to be an ongoing grievance against the University and allegations of violations of University policies, victimisation and misconduct. It was not because he exercised workplace rights”.

In coming to these conclusions, the judge was cognisant of the purpose of a Performance Appraisal was one of development of an employee’s career/identify training opportunities that would benefit the employee.

ALLEGATIONS OF BREACHES OF CONTRACT

Introduction

Whilst there were no specific allegations of breach of the contract of employment, in the “prayer for relief”, damages are sought for breach of implied terms of the contract.

The allegations seem to be that the University breached implied terms of the contract of employment:

  • to provide the applicant with a safe system of work, to take all reasonable steps necessary to protect his safety and to avoid exposing him to unnecessary risks of injury;
  • to cooperate with the applicant;
  • to comply with its policies.

The judge summarising the “common law” of the contract of employment may be of assistance to fellow practitioners…

Safe system of work

In Tame v New South Wales (2002) 211 CLR 317, McHugh J held at [140]:

…The law of contract does not imply two terms of reasonable care; it does not imply a duty to protect against physical harm and a separate duty to protect against psychiatric injury. It simply implies a general duty to take reasonable care for the safety of the employee and, it might be added, for the employee’s property.

Implied duty of cooperation

There is an implied duty to cooperate in the doing of acts necessary to performance of, or to enable the other party to secure a benefit provided by, the contract: Commonwealth Bank of Australia v Barker (2014) 253 CLR 169 at [37] and [61].

In Regulski v State of Victoria [2015] FCA 206 at [211]–[213], Jessup J held:

“211         As to the first implied term relied on, there is, of course, a duty of co-operation which is implied into employment contracts, as within the class of contracts in which the derivation of the benefit of the contract by one party is dependent upon some co-operative action by the other party: see Secured Income Real Estate (Aust) Ltd v St Martins Investments Pty Ltd (1979) 144 CLR 596. But, properly understood, the duty to co-operate is a specific one. It is not as though there is a term in contracts of employment that the parties must co-operate with each other, in the broad as it were. An employee who declines an invitation to act in a supervisory position to cover a temporary absence may be viewed by his or her employer as being distinctly unco-operative, but this would not give rise to a breach of contract…

“213         It was submitted on behalf of the applicant that “the scope of the required co-operation between the parties to a contract must be defined by what has been promised under the particular contract.” I accept that. It was then submitted that the policies of each of the respondents in the present case had been agreed as between the relevant respondent and the applicant, such that “both the employer and the employee would comply with their respective policies in the workplace”. I do not accept that. It was not pleaded that the policies had been agreed as terms of the applicant’s contract of employment: indeed, it was alleged that the Department required the applicant to comply with its policies. Consistently with this allegation, I would hold that, in presently relevant respects, the respondents’ policies were internal rules, procedures, etc with which their employees were required to comply. They were issued pursuant to an employer’s common law power to direct. They were not contractual”.

The policies as implied terms

Ed: this is most important and why each employment contract should contain words to the effect: “Your employment will also be governed by the Company’s published policies and procedures as may be varied from time to time. However, these policies and procedures do not refer any contractual obligations at law, including the Code of Conduct”.

The applicant alleged that the University’s policies are incorporated into the terms of the employment contract.

“An employer’s policies or procedures can only be incorporated into an employment contract by express or implied agreement. Whether or not the terms of policies or procedures have been incorporated depends upon the parties’ intentions, which are to be determined objectively. The Court is required to consider whether or not the language used by the parties, in the context in which those words were used, would have led a reasonable person to believe that the policy or procedure had been incorporated.

“The factors that are relevant include the wording of the contract; the wording of the policy or procedure in question (and whether or not the terms are contractual or promissory in nature); the subject matter of the policy or procedure and the circumstances surrounding the making of the contract; and whether or not the contract has an express clause that states the policy or procedure is not incorporated: see generally Romero at [33]–[63].

“A term will not be implied if to do so would contradict any express term of the contract. Accordingly, terms of a policy or procedure will not be incorporated if to do so would be inconsistent with an express term of the contrary.

Employment contracts have been found to incorporate an employer’s policies and procedures in circumstances where the employee was required in the employment contract to “abide by” the policies and procedures and the policies and procedures used promissory language. A policy or procedure will not be incorporated if it is intended to operate as a guideline only and is not intended to have contractual force, or the employment contract expressly provides that the policy or procedure does not form part of the employment contract”.

[citations omitted].

RELIEF

The allegations (outcome)

Of the 41 allegations, the judge upheld five, therefore finding that the University contravened s 340(1) of the FWA. That is that the University was “guilty” of taking adverse action against the applicant on five occasions.

Penalties (Generally)

The judge will hear the parties as to penalties on a later date but set out the consideration of the question of compensation and damages.

Ed: At this point it is instructive to point out that there no restrictions on awards to successful applicants in the Federal Court system. This is different to an unfair dismissal whereby the award of compensation to a successful applicant is six months’ pay.

The judge then set out a number of citations (omitted) relating to the award of compensation as summarised:

  • There needs to be a causal connection between the contravention and the loss claimed.
  • What is reasonable in the circumstances and what would have been likely to occur had the Act not been contravened.
  • The detriment occasioned to the employee by the employer’s contravention of the Act, and the extent to which it is reasonable to compensate the employee for such consequences.
  • Compensation may be awarded for non-economic loss such as hurt and humiliation, as well as for economic loss.

Penalties (This case)

Turning specifically to the applicant’s situation:

  • Breach of confidentiality and resulting fear of the threat of legal action:

“I accept that [the applicant] must have experienced substantial fear and distress upon receiving the threat of legal action. I accept that he was also distressed by the breach of confidentiality of his complaint itself.

  • The applicant submitted that he developed a psychiatric illness as a result of his mistreatment by the University. He relies upon two reports of a psychiatrist. The judge commenting:

“I consider that the aggravations were minor and of temporary effect. The evidence does not establish that the aggravations caused by the contraventions were permanent. By far, the greater contributions to his condition were made by the numerous workplace events which have either been found not to constitute any breach of the FWA or did not form part of the pleaded allegations”.

How much?

The judge awarded the applicant $15,000 for the mental and emotional distress.

Lack of career progression

The applicant submitted that his career has not progressed because of the workplace events and his reputation has suffered and that he should be awarded compensation for that loss:

“It is necessary to consider whether the contraventions have made any contribution to the lack of progression of [the applicant’s] career.

“[The applicant] has been continuously employed with the University on a full-time basis since February 1998. He has remained at the level of Lecturer (Level B) since he was appointed. He applied for promotion to Senior Lecturer (Level C) once in early 2000 and was unsuccessful.

“…his philosophy colleagues who started at the same time as him have been appointed to Senior Lecturer (Level C) and Associate Professor (Level D) respectively. He states that he expected to complete one of his books in 2011 and to have followed his colleagues with promotion in 2012 to Senior Lecturer and then to Associate Professor by now.

“It may be accepted that [the applicant’s] career has stalled. The reason for that is that he has not applied for promotion. His failure to apply seems to recognise that promotion would not be warranted upon the present state of his academic accomplishments. The issue is why he does not have the accomplishments necessary to achieve promotion.

“I accept that [the applicant’s] psychiatric condition has played some part in the lack of progression of his career. For example, since 2010, [the applicant] seems to have been obsessed with and focussed upon his complaints, and now this litigation. Some of his correspondence reveals an extraordinary amount of time dedicated to composing submissions to support his complaints and composing lengthy emails to make a point, at the expense of the time available for research. He declined to take the SSP leave he was granted in 2013, when that might have helped him to improve his research record.

“It may be noted that [the applicant’s] career was already at a standstill before he made his initial complaint…on 12 April 2010, since he had been employed by the University as a lecturer for about eleven years without being promoted”.

Finding that:

“…I consider that the minor contributions these contraventions made to his psychiatric condition have made no material contribution to [the applicant’s] lack of career progress. I am not satisfied that the contraventions have contributed to the stalling of his career or affected his reputation in any other way.

“In making this assessment, I do not wish to sound harsh. The evidence shows that [applicant] is highly regarded as a teacher by his students. I would have thought that the ability to teach and impart knowledge is by far the most valuable quality an academic could bring to a university. Unfortunately, it appears that the University is much more impressed by the quantity of publications in obscure journals read only by other academics”.

Damages for breach of contract

“The general principle is that where a party sustains a loss by reason of a breach of contract, they are, so far as money can do it, to be placed in the same situation, with respect to damages, as if the contract had been performed.

“[The applicant] would not have suffered the temporary aggravations of his psychiatric illness that I have found if the University had performed the contract. On the basis of the facts I have found, the award of damages for breach of contract would be the same as the award of compensation for the University’s contraventions of s 340(1) of the FWA. As I have indicated, I will award [the applicant] $15,000 for those contraventions”.

WHERE TO FROM HERE?

The awarding of $15,000 to the applicant is just the beginning. The judge allowed for further submissions (which he limited to 15 pages) leaving the door open for further penalties and costs in the applicant’s favour, which is scheduled for a further hearing 8 July 2020.

Introduction & Background

Labour hire firm Workpac is again in the news in relation to the employment of casual workers, You may recall the Skene decision which the Federal Court deemed that, what Workpac had thought to be a casual employee (Mr Skene), the court ruled that Mr Skene was not a casual.

The feral government were quick to act, implementing a provision in the Fair Work Regulations 2009, to the effect that if you put the wording in an industrial instrument (ie contract, award. EBA), that states that clearly states that the 25% loading is paid instead of leave, etc, then this nullified the Skene decision.

However, last week (20 May 2020) a Full Bench of the Federal Court handed down yet another decision relating to casual employment. Only this time Workpac itself was the progenitor in asking the Court seeking a declaration by the Court that casual employees receiving a casual loading not be entitled to leave payments. This case “used” Mr Rossato, as an example, who like Mr Skene, was on-hired by Workpac to various mine sites.

Summary of Federal Court decision

In summary, all three judges concluded that Mr Rossato was not a casual employee and was there for entitled to leave. In this 272-page judgement, the fact that (as in Skene) there was no actual legal definition of a casual employee other than they are neither a full-time nor part-time employee. Therefore, relying on past case law (precedents), and settling on the term “firm advance commitment” made Mr Rossato and Mr Skene both not casuals.

But most instructional to employers, should be the decision means that just you call someone a casual, does not mean that they are. In my words: “if it has feathers and quacks, it’s a duck”.

So how do we fix the problem?

Through the annuls of industrial relations law, everybody new what a casual employee was, right? Not so, since the expansion of what was once known as being a “temp” (temporary employee), there has been a huge spike in the number of so-called labour hire firms spring into the employment market. Great! Say the employers, which could now grab labour if and when they need it. No pesky paperwork or dealing with poor performance, just labour to do a job.

This in turn has led to, what the unions call, the “casualisation of the Australian workforce”. That is, we now have large tranches of workers who have zero job security. This has been illustrated very clearly with the Jobkeeper payment replicating the unfair dismissal laws of a casual employee only eligible (in this case) JobKeeper payments if they have worked regularly and systematically for an employer for more than 12 months.

My belief is that casual employment should be limited in scope and be the last option of employment. For workers, casual employment should be the icing on the cake, not the whole cake. That is, to supplement a low paying job, as was taxi driving years ago.

Just change the law, right?

Well yes and no.

With the Skene and Rossato decisions, coupled with a huge amount of unfair dismissal case law to draw on, the legislators should not find it too hard to come up with a legal definition of casual employment.

On the other hand, we all know what casuals were before the advent of labour hire firms: a warm body you get in to fill a gap caused by someone pulling a “sickie” or (maybe) short-term leave vacancy.

Temporary or fixed term employment

Which leads to the issues surrounding the employment of temporary or fixed term employment. The employment of such a person may be warranted by an employer to fill short, medium long-term vacancies or maybe a fixed term budget allowance.

Temporary and fixed term employment are treated, by industrial law, as “permanent” or “ongoing” employees for the purpose of the accrual of leave entitlements. That is, you would pay the “temp” as you would a permanent employee (albeit, probably at a lower rate of pay – depending on which Modern Award/EBA in play), but on a pro-rata basis. Annual leave would usually be paid at the end of the assignment.

The problem with such temporary/fixed term arrangements is that the courts have determined that the dates of such employment are set in stone. That is, (except for serious misconduct), to be considered a temporary/fixed term employee, the worker must serve out the entire contracted period (and also not exceed this period, unless a subsequent agreement is put in place).

Put simply, contracts that state “up to X date” (known as “outer limit contracts) have been determined not to be temporary/fixed term employment. This goes without saying, if you wish to shorten the length of the employment.

I believe that to fix this issue, legislation needs to be adopted to provide for “outer limit” contracts.

Permanent Casuals

There is no such animal. You are either “permanent” or “casual”. Not both. End of story.

I know of a number of businesses who adopt this model (hence the limitations imposed under unfair dismissal law). And they complain when an employ does not turn up for work!

For the uninitiated, casual employment is a series of “engagements” (usually a day) and each period of casual employment concluded at the end of each day. So, the “casual” bit works both ways, the employee may say “do not turn up for work tomorrow” and the employee may say “no thanks”.

Some other companies use an initial period of casual employment as a “probationary period”. The reward for becoming so-called “permanent – the taking away of the casual loading, effectively rewarding the employee with a 25% pay cut. Remember, if you are worried about unfair dismissal, employees must be employed for longer than 12 months if you employee fewer than 15 employees or six months if you employ more than 15. This is plenty of time to decide.

Full-time ongoing employment

Notice I did not use the work “permanent”. What employment is permanent these days (perhaps the public service?), but I digress.

Employees who are lucky enough to be employed on a full-time ongoing basis as do part-timers, have the most job security of all employment types. They are entitled to all sorts of leave arrangements, including able to take a holiday. They are also more likely to be able to apply for a mortgage to buy a house.

Nothing to see here. Let us move on.

Part-time ongoing employment

Everybody knows that a “permanent part-time” (see my previous comments) is less than the hours of a full-time employee; usually but not always 38 hours per week.

Under most (if not all) Modern Awards, a part-time employee must:

  • Be advised (in writing) on which day of week they will work, and the hours on each day to be worked. I get this. This restriction is put in place to stop unscrupulous employers from changing a part-timer’s days to avoid paying public holidays. You usually work on a Monday, “not this week mate. Public holiday on Monday we will move you to Tuesday”. Simple.
  • If the agreed hours (remember, in writing) are exceeded on any day, then overtime is payable.

And it is the overtime bit that gets on my client’s (and my) nerves. This is a fairly recent event in industrial relations terms, creeping into all awards.

It is my strong belief that the payment of overtime for anything less than the full weekly hours (again, usually 38) is not helpful to the employee, who may otherwise benefit from additional hours, or the employer who will be reluctant to offer further hours due the cost imposition (or ignore this requirement altogether).

The answer is simple. Overtime should only be paid after working 38 hours (or average of) a full-time worker.

Summary and Conclusion

Casuals

  • A definition should be legislated and placed in the Fair Work Act.
  • Casuals should be a hire of last resort – not a business model.

Permanent casuals

  • No such thing. Move on.

Temporary/Fixed term

  • Again, the definition should be refined to allow for “outer limits” of employment, therefore allowing for greater flexibility in employment.

Part-time

  • Remove restrictive overtime provisions and align with full-time hours for the purposes of overtime.

Full-time

  • The holy grail. If the business has the capacity, then this should be the first option.

Unfair dismissals

On a final note, employers have been critical of this legislation since its inception. I agree. It has developed its own $multi-billion industry – especially in the No-win, no-fee space.

However, the spectre of an unfair dismissal should not be used as a business model. If you want happy, productive workers – treat them with respect and be on the look-out for toxic employees and/or poor behaviour and address these issues in a professional manner treating each case in a consistent and but fair manner.