Employ­er defends adverse action claim by employ­ee dis­missed dur­ing pro­ba­tion­ary period

In brief – Dis­missal dur­ing pro­ba­tion not nec­es­sar­i­ly an adverse action

Fol­low­ing on from our ear­li­er arti­cle on adverse action, a recent case has high­light­ed how an employ­er can be suc­cess­ful in defend­ing a claim lodged by an employ­ee who was dis­missed dur­ing a pro­ba­tion­ary period.

Hod­kin­son v The Com­mon­wealth [2011] FMCA 171

San­dra Hod­kin­son was engaged by the Child Sup­port Agency (CSA) as a col­lec­tions offi­cer for a six month pro­ba­tion­ary period.

Dur­ing the third month of her pro­ba­tion, she was absent for two days after being diag­nosed with bulging discs in the spine. She was placed on a grad­ual return to work pro­gram which increased her dai­ly hours from 5 to 7.24 over a four week peri­od and required her to take reg­u­lar breaks to stretch her back.

In the fol­low­ing month, Hod­kin­son was placed on a work improve­ment plan because of her fail­ure to reach her per­for­mance tar­gets, con­sist­ing of mak­ing 20 out­bound calls per day, final­is­ing six cas­es per month and col­lect­ing $17,500 per month.

Hod­kin­son encoun­tered dif­fi­cul­ties in bal­anc­ing her return to work pro­gram with her work improve­ment plan. In the fifth month of her pro­ba­tion, she attend­ed a meet­ing with her man­agers and was hand­ed a report which rec­om­mend­ed her termination.

Usu­al one-week exten­sion not granted

Dur­ing this meet­ing, Hod­kin­son was advised that oth­er employ­ees in a sim­i­lar posi­tion had been offered a one week exten­sion to prove that they could meet their tar­gets. Unfor­tu­nate­ly for Hod­kin­son, she was sched­uled to have surgery relat­ing to oth­er med­ical prob­lems in the fol­low­ing week and was denied the usu­al one-week extension.

It appears that CSA refused this exten­sion because they did not want Hod­kin­son’s ser­vice with CSA to extend beyond six months, as they would then have been oblig­ed to give her notice of ter­mi­na­tion. This meant that CSA need­ed to act before the end of the pro­ba­tion­ary peri­od to take advan­tage of its pur­pose, name­ly, to avoid Hod­kin­son becom­ing a per­ma­nent employ­ee who would then be enti­tled to notice of termination.

Com­plaint about the impact of med­ical prob­lems on meet­ing per­for­mance targets

After this meet­ing, Hod­kin­son raised com­plaints with the HR Man­ag­er that her med­ical prob­lems had hin­dered her abil­i­ty to meet her per­for­mance tar­gets and this had not been tak­en into account.

In the fol­low­ing week, Hod­kin­son dis­put­ed with the CSA that she had failed to meet her per­for­mance tar­gets because she recal­cu­lat­ed her tar­gets to take into account her return to work pro­gram. Notwith­stand­ing her com­plaints, Hod­kin­son received a let­ter advis­ing her of her ter­mi­na­tion for fail­ing to meet her per­for­mance targets.

Hod­kin­son lodged an adverse action claim with the Fed­er­al Mag­is­trates Court seek­ing rein­state­ment and com­pen­sa­tion. The crit­i­cal ques­tions raised by the claim included:

  • Whether the CSA took adverse action in dis­miss­ing Hod­kin­son because she had lodged a com­plaint with the HR Manager
  • Whether the CSA took adverse action in dis­miss­ing her and/​or deny­ing her an exten­sion of her work improve­ment plan because she suf­fered from a disability
Adverse action — dis­missal based on complaint

The court acknowl­edged that the abil­i­ty to make a com­plaint in rela­tion to employ­ment con­sti­tutes a work­place right which can form the basis for an adverse action claim, where an employ­er takes adverse action because an employ­ee has lodged such a complaint.

How­ev­er, the court raised doubts as to whether Hod­kin­son had in fact com­plained at all to the HR Man­ag­er in rela­tion to her employ­ment. Fur­ther, the con­ver­sa­tion with the HR Man­ag­er was char­ac­terised as a sub­mis­sion in response to the CSA’s rec­om­men­da­tion to ter­mi­nate her employ­ment, not a complaint.

Nonethe­less, the court found that even if this con­ver­sa­tion did amount to a com­plaint, this did not form any part of the CSA’s basis for dis­miss­ing her. Rather, the dis­missal was pure­ly the result of her fail­ure to meet her per­for­mance tar­gets dur­ing her pro­ba­tion and this was specif­i­cal­ly artic­u­lat­ed in the ter­mi­na­tion letter.

Adverse action based on disability

In rela­tion to the sec­ond point, the court was par­tic­u­lar­ly crit­i­cal of Hod­kin­son’s sub­mis­sions because they failed to iden­ti­fy a spe­cif­ic dis­abil­i­ty which alleged­ly formed the basis for CSA’s deci­sion to dis­miss her. Although this hin­dered Hod­kin­son’s claim, it did not ulti­mate­ly affect the court’s deci­sion to reject the claim because it was found that the deci­sion to dis­miss Hod­kin­son was sole­ly based on her fail­ure to meet her targets.

Lim­i­ta­tion or consequence?

In addi­tion, the judg­ment appeared to con­fine the scope of adverse action claims based on dis­abil­i­ty by draw­ing a dis­tinc­tion between the phys­i­cal and men­tal lim­i­ta­tions asso­ci­at­ed with a dis­abil­i­ty and the con­se­quences of those limitations.

Unfor­tu­nate­ly, this cre­ates a con­sid­er­able degree of uncer­tain­ty because of the dif­fi­cul­ties asso­ci­at­ed with char­ac­ter­is­ing a par­tic­u­lar effect of a dis­abil­i­ty as either a lim­i­ta­tion asso­ci­at­ed with a dis­abil­i­ty or a con­se­quence of that lim­i­ta­tion. For exam­ple, is the require­ment to take breaks dur­ing employ­ment because of a back injury a phys­i­cal lim­i­ta­tion of a dis­abil­i­ty or a con­se­quence of the phys­i­cal lim­i­ta­tion? These are ques­tions which are sub­ject to con­sid­er­able doubt and, in effect, will only act to lim­it the scope of adverse action claims based on disability.

In the present case, it seems that the fact that Hod­kin­son had to attend surgery for a dis­abil­i­ty was a prac­ti­cal con­se­quence rather than a phys­i­cal lim­i­ta­tion and there­fore could not form the basis of a claim based on adverse action.

Lessons for employers

This deci­sion clear­ly high­lights the impor­tance of being crys­tal clear in your doc­u­men­ta­tion about the rea­son for dis­miss­ing an employ­ee, in this case being the fail­ure to meet per­for­mance tar­gets. This also ensures that the employ­ee will be unable to claim that they were dis­missed because of com­plaints they made dur­ing the course of employ­ment or because they have a disability.

The full text of the judg­ment in Hod­kin­son v The Com­mon­wealth [2011] FMCA 171 can be down­loaded from the web­site of the Fed­er­al Mag­is­trates Court of Aus­tralia.

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