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Focus: Workplace Relations

19 November 2015

In this issue: we look at the unusual role social media can play in bullying at work; valid dismissals that can be procedurally unfair; consultants' reports and unfair dismissal proceedings; requirements for notices of entry; obtaining permission to appeal in the Fair Work Commission; vague job security clauses being binding on an employer; and low threshold for admitted adverse action.

Social media activity can contribute to workplace bullying

In brief: Facebook 'defriending' can be relevant to bullying at work. Associate Katie Gardiner reports. 

 
 

How does it affect you?

  • Activity on social media may contribute to a finding of bullying at work.
  • Employers should be proactive in dealing with allegations of bullying. Relying on the existence of a bullying policy will not be sufficient to demonstrate bullying will stop.

Bullying allegations and findings

Ms Roberts, a real estate agent working for VIEW Launceston Pty Ltd, filed an application for orders to stop bullying at her workplace. She made 18 allegations of unreasonable conduct. The allegations involved Mr Bird, the principal of the real estate agency, and his wife Mrs Bird, who worked as a sales administrator. The Commission found that eight of the allegations involving Mrs Bird were made out, including:

  • belittling Ms Roberts in front of others;
  • failing to greet Ms Roberts each morning;
  • speaking to Ms Roberts in a rude and hostile manner when she offered to answer the phone;
  • failing to follow usual procedures and deliberately delaying administrative work involving Ms Roberts' property listings; and
  • placing one of Ms Roberts' clients on a debtor collection list after Ms Roberts had arranged for the fees to be paid after the sale of the client's property.

Ms Roberts alleged that during a one-on-one meeting, Mrs Bird was hostile and aggressive and called her a 'naughty little school girl running to the teacher' and stood in front of the door when she tried to leave the room. Ms Roberts said she left the office crying, and then checked her Facebook account in her car to see whether Mrs Bird had posted anything about the incident. She discovered that Mrs Bird had deleted her as a 'friend'.

Deputy President Wells from the Fair Work Commission said that the defriending action evinced 'a lack of emotional maturity and is indicative of unreasonable behaviour'. As a result of her repeated, unreasonable behaviour, Mrs Bird had engaged in bullying at work.

An anti-bullying policy is not always sufficient

In deciding to make an order to stop bullying, Deputy President Wells considered whether there was a risk of bullying continuing at Ms Roberts' workplace1. Since Ms Roberts had filed her application, the firm had introduced an anti-bullying policy. However, Ms Roberts' employer and the perpetrator had failed to recognise that the behaviour in question was bullying. Given they denied any wrongdoing, there was a possibility that such behaviour would be repeated in the future, despite the introduction of the policy.

Ensuring valid dismissals are not procedurally unfair

In brief: The Fair Work Commission has found that an employer had a valid reason for dismissing an employee on medical grounds but that the dismissal was harsh and procedurally unfair. Partner Simon Dewberry and Lawyer Dana Rechtman report.

 
 

How does it affect you?

  • The obligations imposed on employers under workers' compensation laws may be relevant in determining whether there is a valid reason for dismissal.
  • Employers should ensure that communications regarding an employee's employment, including in relation to workers' compensation processes and termination, are clear, and provide employees with adequate time and information to allow them to respond.

Background

In Lawless v Qantas Airways Limited [2015] FWC 6456, Mr Lawless was dismissed from his employment as a baggage handler with Qantas Airways Limited on medical grounds. From 2001, his capacity to work was seriously diminished as a result of a number of work-related injuries. By 2012, Mr Lawless was only performing a data collection task that took about one-and-a-half hours a day. In accordance with its duties under the Workers Rehabilitation and Compensation Act 1986 (SA) (the WRC Act), Qantas had previously established a rehabilitation and return to work plan (RRTW Plan) with the objective of returning Mr Lawless to work at Qantas. In 2013 Qantas, with the support of the WorkCover Corporation claims agent, changed the focus of the RRTW Plan to obtaining suitable employment with a different employer.

On 14 May 2013, Mr Lawless received a letter from the HR department (the show cause letter), which stated that Qantas was considering terminating his employment on medical grounds. The show cause letter referred to (but did not include) a medical report that stated that Mr Lawless could not meet the inherent requirements of his job. The show cause letter also gave Mr Lawless the option of providing Qantas with further information within seven days, including medical evidence confirming that he could safely perform his pre-injury role. Mr Lawless was also given a second letter from Qantas' Workers' Compensation Claims Manager, dated 10 May 2013, advising him of Qantas' intention to terminate his employment. Mr Lawless ultimately received a letter of termination on 11 July 2013.

Mr Lawless filed an unfair dismissal application, arguing that there was no valid reason for his dismissal because Qantas failed to provide him with suitable employment in breach of the WRC Act, and that he had no opportunity to respond to the show cause letter. Qantas argued that Mr Lawless was unable to perform his position or any other position within Qantas, continuing to accommodate him with lighter duties would impact on the welfare of other employees, and it was not reasonably practicable to provide him with other suitable duties.

Was the dismissal unfair?

The Fair Work Commission held that the obligations imposed on an employer under workers' compensation law can be relevant to whether there was a valid reason for dismissal. However, in this case, there had been no determination that Qantas had acted unlawfully. There was a valid reason for dismissing Mr Lawless, as he was unable to fulfil the inherent requirements of his position. It was also relevant that Qantas had provided Mr Lawless with suitable employment for 12 years. It was open to Qantas to cease providing suitable employment.

However, the dismissal was considered to be procedurally unfair. Mr Lawless was not given an opportunity to respond by putting a case in support of his ongoing employment, including because of the unrealistic time frame provided by the Show Cause Letter and the confusion surrounding the two letters. Qantas also failed to respond to queries raised by Mr Lawless' lawyer regarding his employment status and only provided the medical report to Mr Lawless after he was asked to respond with the requested information.

The dismissal was also harsh, given that Mr Lawless had 23 years' service with Qantas and that his age (56 years old), medical history and physical limitations made it unlikely that he would be able to secure any further employment. While it was afforded limited weight, the Commission had regard to the fact he was only given four weeks' pay in lieu of notice when he was entitled to five weeks' notice or payment in lieu thereof and this was not rectified for nearly two years.

Reinstatement was not appropriate given that Mr Lawless was performing limited work and there was a valid reason for his dismissal. As a result, Mr Lawless was entitled to an award of compensation.

Consultant's reports relevant to unfair dismissal proceedings

In brief: The Fair Work Commission has required an employer to produce a consultant's bullying report in an unfair dismissal proceeding. Special Counsel Eleanor Taylor and Lawyer Karina Travaglione report.

 
 

How does it affect you?

  • Reports prepared by consultants may be discoverable in proceedings brought by dismissed employees, even if the report does not directly deal with the reasons for dismissal.
  • Employers should always consider whether and how to maintain privilege over investigative reports relating to workplace incidents or issues.

Background

The employment of the applicant, Mr Masoe, was terminated by MMA Vessel Operations Pty Ltd because of his conduct in relation to two incidents. The first incident involved Mr Masoe's response to a workplace bullying complaint. MMA had requested that Mr Masoe provide his version of events in relation to a complaint by a colleague. The colleague had complained that his name had been written on a drawing of a penis. Mr Masoe wrote the words 'don't know' on the form provided, and drew some pictures that were intended to be humorous, including a helmet that symbolised a penis.

The second incident involved alleged threatening behaviour by Mr Masoe towards another employee.

Mr Masoe attended two interviews with MMA regarding both incidents. The interviews were also attended by a consultant from PricewaterhouseCoopers (PwC), who had been commissioned to inquire into broad allegations of bullying and harassment. Following the interviews, MMA sent Mr Masoe a Letter of Concern, expressing unease about Mr Masoe's 'flippant approach' to the allegations of bullying, and his threatening behaviour. Mr Masoe's employment was subsequently terminated.

Mr Masoe made an unfair dismissal claim. He also sought orders that MMA provide any reports prepared by PwC in the course of its inquiry into workplace bullying and harassment.

Provision of investigation report

The issue was whether PwC's report was relevant to a matter in issue in Mr Masoe's unfair dismissal proceeding. MMA argued that its reasons for dismissing Mr Masoe were extraneous to the broader issues of bullying and harassment investigated by PwC. The Commissioner acknowledged the importance of the application not being used as a 'fishing expedition', but found that the decision to dismiss Mr Masoe was, in part, a result of the interviews that were attended by the PwC consultant. Any PwC reports relating to Mr Masoe's actions were therefore relevant to his dismissal2. As a result, any reports prepared by PwC regarding Mr Masoe's actions in relation to the incidents leading to his dismissal would be directly relevant to his unfair dismissal claim.

Implications

This decision follows the trend in recent cases where employers have been required to produce investigative reports relevant to the employer's state of mind when dismissing an employee (see our previous Focus article on Bartolo v Doutta Galla Aged Services Ltd).

Notice of entry does not need to specify particular parts to be entered

In brief: The Federal Court has issued interim orders indicating that a notice of entry may not need to specify the particular part of 'the premises' to be entered, even if 'the premises' is a major project extending over hundreds of hectares with multiple employers and thousands of employees. Special Counsel Eleanor Taylor and Lawyer Karina Travaglione report.

 
 

How does it affect you?

  • Under Northern Territory workplace health and safety legislation, the right to enter premises to investigate suspected safety breaches does not necessarily include the right to take photographs or recordings.
  • Under the Fair Work Act, it may not be necessary for an entry notice to specify the particular part or parts of the premises proposed to be entered, regardless of the size of the site in question.

Background

JKC Australia LNG Pty Ltd is the principal contractor at an onshore construction project in the Northern Territory (the Project). The Project involves substantial construction work over a number of areas on the site, which is approximately 340ha, and involves thousands of employees. Contractors on site have employees located at numerous work areas with the Project.

The Communications, Electrical and Plumbing Union (the CEPU) and three organisers commenced proceedings in the Federal Court, alleging that JKC breached the Fair Work Act (the FWA) by refusing or delaying their entry onto the Project site or obstructing the exercise of their rights of entry.

Injunctions sought

The CEPU and organisers also sought interlocutory injunctions restraining JKC from:

  • refusing union officials entry onto the Project premises if they have given a notice specifying those premises and a day of entry in accordance with the FWA; and
  • prohibiting their officials from using a camera to document health and safety concerns while exercising a right of entry under the Work Health and Safety Act (the WHS Act).
Must an entry notice specify the particular part of premises to be entered?

The CEPU argued that the notice requirements in section 518 of the FWA do not require specification of the particular part or parts of premises to be visited. By contrast, JKC argued that, due to the large Project site and large number of employers and employees involved, the FWA should be construed as requiring specificity of the part or parts of the site to be visited. That is, the location within the Project site of the work area to be visited.

The Federal Court found that the CEPU's position was reasonably arguable, based on the plain words of the FWA (which require an entry notice to specify 'the premises' at which entry is proposed)3. This was despite employers having employees located at various work areas on the site.

In addition, the balance of convenience favoured the CEPU, including because of the significance of the role of union officials in exercising right of entry. This overrode the inconvenience that might be experienced by JKC if the union officials did not specify the particular areas they wished to visit. As a result, the first injunction sought was granted.

Is a permit holder exercising a right of entry entitled to take photographs?

This issue arose because JKC had prohibited the CEPU's officials from taking photographs while exercising rights to enter the Project site and inquire into suspected workplace health and safety breaches. Justice White referred to the rights conferred by the WHS Act on a permit holder, namely, rights of inspection, consultation and copying of documents. The CEPU argued that a power to make a record by taking photographs or recordings was implicit in the power to inspect.

Justice White found it to be significant that the WHS Act was highly prescriptive, but did not contain an express right to use a camera. As a result, the union had not made out a prima facie case and the second injunction was refused.

Implications of decision
  • As this was an interlocutory decision, the issues of statutory construction will be decided in the substantive proceeding.
  • In the absence of an express provision, courts will be reluctant to read down the rights of union officials to enter workplaces in an interlocutory proceeding.

Obtaining permission to appeal in the Fair Work Commission

In brief: The Full Bench of the Fair Work Commission has confirmed that an appellant will not be granted permission to appeal a decision merely because they disagree with the conclusions that were reached in a first instance decision. Partner Veronica Siow and Associate Tarsha Gavin report.

 
 

How does it affect you?

  • A party who wishes to appeal a decision of the Fair Work Commission (FWC) must establish that there has been an appealable error, and that there is a public interest in the FWC granting permission to appeal.
  • The public interest in granting permission to appeal will not be enlivened merely by an appellant's dissatisfaction with the outcome of a decision. 

Background

Ms Bertrand was the Head of Student Learning Support at Navitas Professional Institute Pty Ltd. Following a restructure of Navitas' business, Ms Bertrand's position was declared redundant. Ms Bertrand subsequently commenced unfair dismissal proceedings against Navitas disputing that the termination of her employment was a genuine redundancy.

At first instance4, Deputy President Sams determined that Ms Bertrand's termination did constitute a genuine redundancy, as her job was no longer required to be performed by anyone and Navitas had complied with its consultation and redeployment obligations.

Permission to appeal

Ms Bertrand appealed the Deputy President's decision. Several grounds of appeal were raised, including that the Deputy President had erred in his findings of fact and that he had refused Ms Bertrand an opportunity to respond to alleged attacks on her credibility.

The appeal was included in the FWC's Permission to Appeal Pilot (the Pilot). This Pilot was introduced by the FWC in December 2014. Under the Pilot, the question of whether an appellant should be granted permission to appeal is heard first in a preliminary hearing before the FWC Full Bench. If permission is granted, only then will the matter proceed to a second hearing where the substantive appeal is heard.

The Full Bench refused Ms Bertrand permission to appeal5. In doing so, it noted that the decision of Deputy President Sams contained a detailed and comprehensive consideration of the evidence and the application of relevant legislation and legal authorities concerning redundancy.

Further, the Full Bench stated that it was not satisfied that it would be in the public interest to grant permission to appeal. The public interest was not enlivened merely by Ms Bertrand's dissatisfaction with the conclusions reached by the Deputy President. 

 Vague job security clauses

In brief: The Full Federal Court decided that a vaguely expressed job security clause in an enterprise agreement created a binding obligation on an employer to avoid redundancies where possible and only use compulsory retrenchments as a last resort. Associate Tegan Ayling reports.

 
 

How does it affect you?

  • Including vague clauses in enterprise agreements creates a risk that a clause will be interpreted in a way that the employer did not intend.
  • Allowing enterprise agreement clauses to roll over means that those clauses remain untested and without debate over their intent.
  • Overly formal legalistic language is best left out of enterprise agreements.

Background

The National Tertiary Education Union (NTEU) applied to the Federal Court for orders to stop La Trobe University from implementing an alleged restructure proposal. The NTEU argued that La Trobe was in breach of its enterprise agreement, in particular the following clause:

The University is committed to job security. Wherever possible redundancies are to be avoided and compulsory retrenchment used as a last resort. The University reserves the right to use the agreed redundancy procedures and provisions set out in this Agreement when all reasonable attempts to mitigate against such action and to avoid job loss have been unsuccessful.

 

The NTEU argued La Trobe had failed to ensure redundancies were avoided wherever possible, to make compulsory retrenchments only as a last resort and to make reasonable attempts to mitigate and avoid job losses.

La Trobe argued that the clause did not create any binding obligation, but was merely aspirational. The primary judge agreed and the NTEU appealed.

The appeal

A 2-1 majority of the Full Federal Court allowed the appeal and ruled that the clause created binding obligations6. In coming to that conclusion, the court said:

  • while there is nothing preventing parties from including clauses that are simply aspirational, enterprise agreements are generally intended to create binding obligations;
  • the lack of obligatory words such as 'will' or 'shall' make no difference in determining whether a clause creates a binding obligation; and
  • although the clause did not expressly set out the steps the employer had to take in order to comply with the obligation, it could still be read so that the obligation applied when it was reasonable or practicable.

The decision meant that La Trobe was obliged to comply with the clause before it could implement the redundancy process in the agreement.

Low threshold for admitted adverse action

In brief: A university has been put to significant expense for an admitted contravention of the adverse action provisions of the Fair Work Act 2009 (Cth). Senior Associate John Naughton reports.

 
 

How does it affect you?

  • Restructuring proposals that may involve employees losing the benefit of a particular industrial instrument may constitute unlawful adverse action.
  • Employers should seek advice when developing reform proposals before communicating them to affected staff.

Background

Swinburne University of Technology (the University) developed a proposal to deliver certain of its courses via a newly established entity, Swinburne College Pty Ltd (the College).

In part, the rationale for the change was to commercialise this aspect of the University's offering. Key aspects of the proposal were that:

  • university staff engaged in delivery of the relevant courses would cease employment with the University;
  • new employees would be engaged by the College to deliver the same courses; and
  • the University would have the benefit that courses previously delivered by University employees covered by the generous industrial conditions in the Victorian TAFE Teaching Staff Multi-Business Agreement 2009 (the Agreement), would then be delivered by College employees covered by less-generous industrial conditions in the Educational Services (Post-Secondary Education) Award 2010 (the Award).

The University then took various steps to implement the proposal, including:

  • deciding to establish the College;
  • deciding to transfer certain of the University's operations to the College (including deciding to cease providing certain courses itself and instead have these delivered by the College);
  • incorporating the College;
  • entering into a written services agreement with the College under which the University would provide the College with certain corporate and other services; and
  • preparing a written College 'Workforce Project Plan' which anticipated the proposal, including its objectives of maximising flexibility, minimising union involvement and disputation, and avoiding the Agreement in lieu of the Award.
The decision

Following interlocutory proceedings brought by the National Tertiary Education Industry Union (the NTEIU), the University admitted its conduct involved a contravention of the adverse action provisions of the Fair Work Act 2009 (Cth) (the Act). The Federal Court's decision was therefore limited to making a declaration of the admitted contravention and deciding the penalty to apply.

The admitted contravention was to the effect that:

  • in making, and then taking steps to implement, a decision to transfer from the University to the College the teaching and delivery of certain courses; and
  • thereafter having the University cease providing these courses,

the University engaged in adverse action by threatening to alter the position of College personnel to their prejudice, for reasons including the substantive and operative reason that they had an entitlement to the benefit of the Agreement.7

The contravention having being admitted, it then fell to the court to determine penalty. While the University was ordered to pay a penalty of $14,000, it also agreed to bear a substantial contribution of the NTEIU's legal fees in the proceedings.

Lessons for employers

The case appears to set a very low threshold in relation to the threat of adverse action. Organisations and businesses frequently generate, review and consider organisational restructuring proposals, and these will commonly involve consideration of additional or alternative employment and industrial relations arrangements. In view of this decision, employers will need to be cautious when dealing with such proposals, especially where these might involve employees losing the benefit of a particular industrial instrument. Employers should seek advice when developing reform proposals of this type, and communicating these with affected staff.

Footnotes
  1. Roberts v VIEW Launceston Pty Ltd & Ors [2015] FWC 6556.
  2. Masoe v MMA Offshore Vessel Operations Pty Ltd [2015] FWC 5454.
  3. Kirby v JKC Australia LNG Pty Ltd [2015] FCA 1070.
  4. Frances Bertrand v Navitas Professional Institute Pty Ltd [2015] FWC 2219.
  5. Frances Bertrand v Navitas Professional Institute Pty Ltd [2015] FWCFB 6833.
  6. National Tertiary Education Union v La Trobe University [2015] FCAFC 142.
  7. National Tertiary Education Industry Union v Swinburne University of Technology (No 2) [2015] FCA 1080. 

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