The High Court's decision this morning in The Board of
Bendigo Regional Institute of Technical and Further Education v
Barclay  HCA 32 means that the considerable risk and
uncertainty employers faced when making decisions with an adverse
effect on employees is substantially lessened and returns to the
levels that were widely accepted prior to the Barclay decision.
How the Full Federal Court's test for adverse action
increased the risk for employers
At trial, the judge had accepted the decision-maker's
evidence that the applicant's union activity had played no part
in the decision-making process.
The Full Federal Court said that this was not sufficient to
discharge the reverse onus placed upon an employer to prove that
adverse action was not taken because of union activity.
The majority held that the employer must
"disassociate" the "real reason" from the
protected attribute, and that although the subjective
intention of the decision-maker was relevant it was not
In this case the majority held that the surrounding facts were
sufficient to prevent the employer from successfully disassociating
the reason for the action from the applicant's union activity,
despite it not playing any part in the conscious decision-making
process of the employer.
The High Court has eased the burden on employers
By overturning the Full Federal Court decision, the High Court
has rejected what is an excessively high burden which was unlikely
to have been able to be satisfied by employers in most cases.
Employers will now be able to focus on the actual reasons in the
mind of the decision-maker. Provided that the Court accepts the
evidence of those reasons (and the evidence that protected
attributes or activities played no part in the decision-maker's
decision) then the reverse onus should be satisfied.
This brings the focus of adverse action issues back to the
consideration of the conscious reasons of the decision-maker and
does not require analysis of unconscious or subconscious
What can employers do?
The High Court's decision, while helpful for employers, does
not completely remove their risk. Employers should continue to
protect themselves by:
understanding the adverse action / general protections laws and
how they operate â€" including what attributes
and activities are protected;
ensuring that the decision-making in matters that may have an
adverse effect on employees is conducted for sound and substantial
reasons unrelated to any protected attributes or activities;
properly document the decision-making process to ensure that
tangible evidence of the reasons for the decision are available for
use in any proceeding.
Clayton Utz communications are intended to provide
commentary and general information. They should not be relied upon
as legal advice. Formal legal advice should be sought in particular
transactions or on matters of interest arising from this bulletin.
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