Pub­li­ca­tions

Adverse action — the new unfair dismissal


In Brief

Employ­ees who do not fit with­in the scheme of unfair dis­missal, either because they are in their qual­i­fy­ing peri­od or because they earn over the high income lim­it of $108,300, are per­mit­ted by the Fair Work Act to bring an even more seri­ous claim relat­ed to adverse action.


What is an adverse action?

The key fea­tures of an adverse action claim are first, that there is a work­place right that the employ­ee has under­tak­en, request­ed, queried or had with­held, such as con­duct­ing union relat­ed activ­i­ties or rais­ing con­cerns they might have in rela­tion to Occu­pa­tion­al Health & Safe­ty (e.g. fail­ure to issue safe­ty eye­wear). The sec­ond fea­ture of an adverse action claim is the alle­ga­tion that you, as an employ­er, have made a deci­sion to take some steps to deal with the work­er in an adverse way.

Adverse treat­ment could include things such as cut­ting employ­ees’ over­time, chang­ing their shifts from week­end to mid-week, can­celling their annu­al leave or forc­ing them to take it, demot­ing them, or, most obvi­ous­ly, ter­mi­nat­ing their employment.

Under the Act, it has to be estab­lished that there is a causal nexus, that is, that the work­place right was the moti­vat­ing rea­son for the busi­ness tak­ing that adverse action. From an employer’s per­spec­tive, the most alarm­ing aspect of the leg­is­la­tion is that there is a reverse onus on the employ­er to prove that the asser­tion of the work­place right by the work­er was not the rea­son that the employ­er took the action in question.

Bendi­go TAFE and the Aus­tralian Edu­ca­tion Union

A recent deci­sion of the Fed­er­al Court con­cerns an employ­ee in a TAFE col­lege in Vic­to­ria, Mr Bar­clay, who was the sub-branch pres­i­dent of the Aus­tralian Edu­ca­tion Union. There was an audit of the facil­i­ty approach­ing and pri­or to the audit, Mr Bar­clay sent an extreme­ly inflam­ma­to­ry email to all staff at the TAFE col­lege, sug­gest­ing that man­age­ment was coerc­ing staff into putting togeth­er false/​fraudulent doc­u­men­ta­tion or par­tic­i­pat­ing in these types of activities”.

Unsur­pris­ing­ly, the CEO of the TAFE was fair­ly con­cerned that these alle­ga­tions were being made imme­di­ate­ly pri­or to the auditor’s arrival. She was also gen­uine­ly con­cerned that Mr Bar­clay was going to con­tin­ue with this course of con­duct. Con­se­quent­ly, Mr Bar­clay was stood down for the peri­od of the audit on full pay. Mr Bar­clay, via the union, assert­ed that this amount­ed to an adverse action against him, as Bendi­go TAFE had stood him down because, amongst oth­er rea­sons, he was an offi­cer of the union and he was engaged in legit­i­mate union activity.

The ques­tion before the Fed­er­al Court was whether or not Mr Bar­clay had been stood down because he was an offi­cer of the union and he was engaged in legit­i­mate union activity.

The union’s position

The union argued that, ulti­mate­ly, the court had an oblig­a­tion to make its own inde­pen­dent assess­ment, regard­less of the evi­dence of the CEO, of whether the two fac­tors were the rea­son for the TAFE tak­ing the adverse action. The court did not see it that way. Rather, it thought that the inten­tions of the employ­er were high­ly rel­e­vant. Accord­ing­ly, evi­dence from the CEO of the TAFE as to why she took that action was impor­tant in mak­ing that decision.

The evi­dence of the TAFE CEO

On this par­tic­u­lar occa­sion, the CEO gave detailed evi­dence that she con­duct­ed an inves­ti­ga­tion of Mr Barclay’s behav­iour, includ­ing giv­ing him an oppor­tu­ni­ty to reply to the alle­ga­tion. In par­tic­u­lar, she gave evi­dence that her rea­sons at the time for exclud­ing him from the cam­pus­es and sus­pend­ing his email access were because she did not want him on the premis­es while the audi­tors were there and she did not want any oth­er unfound­ed alle­ga­tions to be made dur­ing the audit to the detri­ment of the TAFE. She went on to say that she had not even con­sid­ered the fact that Mr Bar­clay was a union mem­ber or that he may have been con­duct­ing indus­tri­al activities.

The court accept­ed her evi­dence and made a find­ing in favour of the employer.

Short­com­ings of the Fair Work Act

Clear­ly, it is a seri­ous short­com­ing of the Fair Work Act that in this sit­u­a­tion the onus is on employ­ers to prove their inno­cence, rather than their inno­cence being assumed until they are proven guilty. While it is encour­ag­ing that on this occa­sion the court was will­ing to accept the evi­dence of the employ­er, unfor­tu­nate­ly there is no guar­an­tee that anoth­er court will take a sim­i­lar­ly sen­si­ble approach.

Lessons for employers

Employ­ers are well advised to take heed of the poten­tial pit­falls in the leg­is­la­tion. In par­tic­u­lar, if you have an an employ­ee who is mak­ing com­ments about OH&S issues, mak­ing enquiries about report­ing injuries for Work­ers Com­pen­sa­tion pur­pos­es or com­plain­ing that he/​she is not being paid a par­tic­u­lar allowance, be par­tic­u­lar­ly care­ful about dis­ci­plin­ing them — even dur­ing the first 6 – 12 months of employment.

If you want to take action against that per­son for oth­er mat­ters relat­ing to per­for­mance or oth­er forms of mis­con­duct or, indeed, the fact that they have estab­lished a pat­tern of com­plain­ing, you have to be crys­tal clear in your doc­u­men­ta­tion and in your coun­selling that it is those mat­ters that are dri­ving you to take this action. It is imper­a­tive that you avoid giv­ing the work­er the oppor­tu­ni­ty to point to you as an employ­er who has put up with mis­con­duct of a sim­i­lar nature on the part of oth­er work­ers with­out tak­ing action.

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