17 September 2010 Termination of employees for breach of OH&S policies - Mixed signals from Fair Work Australia

By Warwick Ryan, Partner

In brief - FWA showing some support for employers on OH&S

Some recent judgments of the Full Bench of Fair Work Australia (FWA) demonstrate support for employers by endorsing the termination of employees who fail to adhere to safe workplace policies.

Some recent judgments of the Full Bench of Fair Work Australia (FWA) demonstrate support for employers by endorsing the termination of employees who fail to adhere to safe workplace policies.

The re-introduction of unfair dismissal under the Fair Work Act for employees who meet the threshold criteria poses a potential problem for employers in dealing with employees who do not comply with legitimate employer directives.

When an unfair dismissal claim is made by an eligible employee, the central threshold for determining whether the claim is valid is whether the dismissal was “harsh, unjust or unreasonable”. In considering whether this threshold has been met, FWA considers a number of factors, including the following:

  • Whether there was a valid reason for the dismissal (i.e. relating to performance or misconduct)
  • Whether there was notification of the reason and provision of an opportunity to respond
  • Any prior warnings where the dismissal concerns performance
  • Any other matters that FWA considers relevant (effect of the termination on the employee, length of service and comparative treatment of other employees in similar circumstances)

In the case of employers who employ fewer than 15 employees, FWA considers whether there has been compliance with the Small Business Fair Dismissal Code. In addition to various procedural requirements, this Code provides that a dismissal will be deemed fair where the employer has reasonable grounds to believe that the employee was guilty of serious breaches of OH&S requirements. Recent judgements suggest that Fair Work Australia is willing to recognise that it is appropriate for employees to be held accountable for compliance with safe workplace policies.

Darvell v Australian Postal Corporation – Unfair dismissal claim rejected
Fair Work Australia’s stance on OH&S breaches is reflected in a recent Full Bench decision involving a postal worker who was terminated for engaging in unsafe work practices and failing to follow directions regarding the correct loading of a truck.

The worker’s unfair dismissal claim was rejected by Deputy President Hamilton despite the worker’s status as an OH&S representative and allegations that other employees had been treated differently for similar breaches. It appears that this rejection was influenced both by the worker’s poor work history and by the importance of promoting workplace safety by enforcing compliance with such policies.

The Full Bench upheld the Deputy President’s judgment. This decision reflects recognition of the practical realities faced by employers in dealing with workplace safety breaches.

Doug Smith v BHP Billiton – Dismissal on the basis of a blood alcohol reading
Another indicator of FWA’s understanding of the employer’s predicament is the recent decision of Deputy President McCarthy, who rejected the unfair dismissal claim of a production technician who was dismissed for registering a blood alcohol reading of 0.05 at work.

At the heart of the claim was the worker’s impending redundancy payout, which the employer avoided through the dismissal. However, the Deputy President was unmoved by this factor and emphasised the reasonableness of the employer’s approach in strictly and consistently enforcing safe workplace policies.

GlaxoSmithKline v Colin Makin – Reinstatement following a serious OH&S breach
Even though the Full Bench of FWA has stressed the importance of enforcing compliance with safe workplace policies, it nevertheless upheld a decision of Commissioner Bissett to reinstate an employee dismissed for a clear and serious breach of the employer’s OH&S policies.

The decision concerned a storeman who, in the course of attempting to fix a jammed pallet in a high-rise warehouse, overrode the safety system in a manner which put his life in peril from a shuttle-car that remained operational in the warehouse.

Initially, Commissioner Bissett found that although this clear breach of OH&S policy constituted a valid reason for dismissal, the manner in which the employee was dismissed was unfair. This finding was based upon the employee’s unblemished record, the practice adopted by other employees, other incidents in the warehouse and the absence of additional training by the employer.

The employer appealed to the Full Bench, which upheld the decision on the basis that the Commissioner had not erred in exercising her discretion to find that the dismissal was unfair and had given due consideration to matters of workplace safety.

Nevertheless, the Full Bench was at pains to stress that this decision does not diminish its view regarding the seriousness of workplace safety breaches, stating that the decision does not “provide any comfort to those who might think” that FWA is taking a soft approach to OH&S breaches.

From the employer’s point of view, it is encouraging on the one hand that FWA has demonstrated that it supports the principle of safety and the obligation of employers to protect staff from their negligent colleagues.

On the other hand, it appears that not all commissioners understand how onerous obligations upon employers are under the legislation or how punitive the Workers Compensation premium increases can be. This lack of understanding can have the effect of allowing employees to ignore safety directives with impunity.

Quinlivan v Norske Skog Paper Mills – Reinstatement due to personal circumstances
In Quinlivan v Norske Skog Paper Mills, Vice President Lawler reinstated an employee who had been dismissed for repeated and flagrant failure to wear safety glasses.

The essence of the decision concerned the absence of a warning and the disastrous personal and financial implications of the dismissal upon the employee, including the prospect of long term unemployment, high likelihood of him losing his house, increased stress upon his marriage and adverse impact upon his daughters.

This decision highlights the risk that some commissioners may be swayed by the personal circumstances of employees and compromise the employer’s ability to dismiss employees for serious OH&S breaches.

Lessons for employers

Employers can be encouraged by a willingness of a number of members of FWA to take breaches of OH&S policies seriously and to support employers who terminate staff on such grounds by rejecting subsequent unfair dismissal claims.

As an employer, you can take a number of steps to protect your position in enforcing OH&S policies:

  • Ensure that your OH&S policies are clearly drafted and that your employees are fully aware of their terms
  • Apply your OH&S policy consistently across the workforce to avoid giving the dismissed employee the opportunity to argue that previous breaches of OH&S policy have not resulted in disciplinary action against other employees
  • Undertake an investigation of the breach – an employer’s failure to investigate properly has recently resulted in a senior mining supervisor being awarded three months’ wages where he had failed to comply with the employer’s OH&S policy (Francis v Kalgoorlie Consolidated Gold Mines)
  • Once you make a finding that the employee breached your policy, conduct a meeting with the employee and a support person to discuss the outcome of the investigation and to provide the employee with an opportunity to respond to the findings and to explain why they should not be sacked 
  • Clearly document the fact that the employee has been dismissed for a serious breach of the OH&S policy

For advice on effective documentation and implementation of workplace OH&S policies, please contact:

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This article is not legal advice and the views and comments are of a general nature only. This article is not to be relied upon in substitution for detailed legal advice.

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