Australia: Workplace bullying reforms: Fair Work Commission to deal with bullying claims

Key Points:

If implemented, the reforms will give individual employees a clear statutory right of recourse to seek redress for workplace bullying for the first time in Australian history

On 12 February 2013, the Hon Bill Shorten MP, Minister for Employment and Workplace Relations, announced that the Government would introduce a number of reforms to tackle what the Minister described as "the hidden scourge of the workplace".¹

The proposed reforms include amending the Fair Work Act 2009 (Cth) to allow employees who suffer from workplace bullying the right to make an application to the Fair Work Commission (FWC) to have it deal with the dispute.

Other proposed reforms include:

• promoting a national definition of "workplace bullying"; and
• developing national training standards to improve responses to bullying complaints.

This article summarises the current legal landscape in relation to workplace bullying, then considers the reforms proposed by the Federal Government and the potential implications of such changes.

The article concludes by considering how employers may prepare for the implementation of the proposed reforms.

The current law on workplace bullying

There has never been any comprehensive legislation in Australia dealing specifically with the issue of workplace bullying, nor is there any express prohibition on workplace bullying in any Australian legislation. As a result, many employers and employees struggle to understand their rights and obligations when dealing with workplace bullying. The law on workplace bullying can best be described as complex.

Given the lack of a dedicated jurisdiction for workplace bullying, employees are forced to bring workplace bullying claims through a range of other legal avenues, including, for example:

• anti-discrimination law;
• criminal law;
• trade practices law;
• common law (eg. breach of contract, negligence or other tortious claims); and
• industrial law (eg. unfair dismissal or adverse action claims).

The effect of the current legal framework is that employees seeking redress for workplace bullying are required to "shop around" to find a cause of action that can be established — this is akin to trying to fit a square peg through one of a variety of differently shaped holes.

Using workplace health and safety laws

Attempts to find a home for workplace bullying within the existing legal framework have progressed recently, with a growing trend towards viewing bullying as a work health and safety (WHS) issue. Under WHS legislation, employers have a duty to ensure the health and safety of workers, and employees have a corresponding duty to take reasonable care for their own health and safety and for the health and safety of others.

Despite that trend, however, the WHS framework has a number of deficiencies in relation to adequately addressing workplace bullying. A contravention of WHS legislation is a wrong against the state, rather than against an individual, and individuals are not able to initiate prosecutions under WHS legislation. Further, statistics demonstrate that the regulators are struggling to respond to the sheer volume of complaints: there were 12,000 bullying-related enquiries made to the regulators in New South Wales and Victoria in the financial year 2011–12, yet there have only been a handful of prosecutions for workplace bullying.²

Workers compensation claims

Employees are, of course, also able to make workers compensation claims in relation to injuries sustained at work caused by bullying. Significantly, however, this mechanism for redress does not prevent the bullying from occurring. It simply provides a remedy for employees once they have already sustained an injury.

Inadequacies of the existing framework: contrast discrimination and sexual harassment remedies

By way of illustration of the inadequacies of the existing legal framework in this area, compare the situation to the law governing discrimination and sexual harassment in the workplace. Specific legislation exists to deal with these issues, and employees are able to make complaints to the Australian Human Rights Commission (AHRC). The AHRC will then investigate the matter and conduct a conciliation in an attempt to resolve the complaint. Where conciliation is unsuccessful, employees may then pursue their claims through the Federal Court or Federal Magistrates Court. There is no such process for dealing with complaints of workplace bullying.

While there have been several recent legislative changes designed to prevent workplace bullying, such as the introduction of "Brodie's Law" in Victoria,³ the reality is that employees who are victims of workplace bullying — unlike victims of discrimination or sexual harassment — do not have an obvious direct right of recourse.

The parliamentary inquiry into workplace bullying

In the context of the national harmonisation process of work health and safety legislation, and in response to a Productivity Commission report estimating that workplace bullying costs the Australian economy between $6 billion and $36 billion annually,⁴ on 31 May 2012 the Federal Government established a parliamentary inquiry into workplace bullying to be conducted by the House of Representatives Standing Committee on Education and Employment.

The Committee received more than 300 submissions from a variety of stakeholders, and its report, titled Workplace Bullying: "We Just Want It to Stop", was handed down on 26 November 2012.⁵

The report made 23 recommendations to address workplace bullying, including that:

• a national definition of "workplace bullying" be adopted;
• a national advisory service be developed to provide advice to employers and employees about bullying;
• SafeWork Australia implement a Code of Practice for managing the risks of workplace bullying;
• the Australian Public Service "fit for duty" tests be reviewed;
• an accredited training program be implemented to train managers and WHS representatives on how to deal with workplace bullying;
• the States and Territories implement laws that are at least as strong as Brodie's Law in Victoria; and
• an individual right of recourse be implemented to allow employees to seek remedies through an adjudicative process.

Interestingly, the Coalition members of the Standing Committee disagreed with a number of the recommendations and prepared their own Dissenting Report. In particular, the three Coalition MPs declined to endorse the recommendation that a right of recourse be established for employees wishing to complain of workplace bullying, citing concerns that it may open the door to potential abuse by employees and tie employers up in court action for extended periods.⁶ This response will undoubtedly inform Coalition policy on this issue.

Reforms proposed by the Federal Government

On 12 February 2013, Minister Shorten responded to the parliamentary committee report by announcing that the Government supported 19 of the 23 recommendations contained in the report. By far the most significant proposed reform is the plan to amend the Fair Work Act to allow employees a right to seek assistance through the FWC. In relation to this reform, Mr Shorten stated:

"The Government will amend the Fair Work Act 2009 to allow a worker affected by bullying at the workplace to apply to the Fair Work Commission to deal with a bullying complaint. The Fair Work Commission will be required to deal with any application as a matter of priority including by listing the matter for consideration within 14 days."⁷

Under the proposed reform, workplace bullying would be expressly defined in the Fair Work Act as "repeated, unreasonable behaviour directed towards a worker or a group of workers that creates a risk to health and safety". However, the legislation will also recognise that bullying does not include performance management conducted in a reasonable manner.

Fair Work Commission's proposed role

Once a complaint is received, either the FWC may refer the complaint to the applicable WHS regulator for investigation and appropriate action under the regulator's compliance and enforcement policy or, alternatively, the FWC may itself deal with the complaint on a final basis. While it is not yet clear exactly how the FWC will deal with complaints, Mr Shorten has indicated that it may be able to respond with conciliation in the first instance.⁸

Should the FWC deal with the matter itself and determine that a person has been subjected to workplace bullying, it will be able to make orders it considers appropriate to remedy or prevent such conduct from recurring. Such orders may include:

• orders requiring an employer to do (or refrain from doing) certain things to resolve the bullying complaint and prevent further bullying;
• orders requiring the complainant or other employees at the workplace to do certain things; and
• publishing the orders to assist in preventing further workplace bullying.

Contrary to many media reports published recently, the proposed reforms will not empower the FWC to issue fines or penalties of up to $51,000 where workplace bullying is established. Rather, fines will only arise in circumstances where a person fails to comply with an order of the Commission (eg. an employee fails to comply with an order requiring him or her to cease certain conduct). In any event, Mr Shorten has said that the Government will consult with stakeholders about the development of penalty tables.

Timeline for implementation of the reforms

The Government is aiming to introduce legislation to Parliament in March, with the hope that the amendments will take effect from 1 July 2013.⁹ The Minister has stated that the Government will consult with stakeholders on the detail of the Fair Work Act amendments.

First impressions of the reforms

The proposal to allow the FWC to deal with complaints of workplace bullying has a particularly strong focus on early intervention, which acknowledges the importance of preserving the employment relationship and preventing bullying from continuing or escalating. In practice, the proposed reform will likely operate in a similar manner to the way that the AHRC deals with discrimination and sexual harassment complaints.

Initial reactions from unions and employer associations

Initial reactions from unions and employer associations have been predictable. Many unions have publicly supported the proposed reforms, while employer associations have voiced concerns about yet another layer of complexity for employers to navigate. Employer groups are concerned that the reforms will result in a rise in speculative bullying claims.

Internal grievance procedure will be bypassed?

One valid concern is that the reforms may lead to employees bypassing their employer's own internal grievance resolution or complaints processes and instead making a complaint directly to the FWC, rendering redundant the well-established and often very good processes that many organisations already have in place to deal with these issues.

While it is not yet clear whether the proposed reforms will address this issue, one suggestion may be to draft the legislation in such a way that requires employees to exhaust their organisation's internal complaints process prior to being able to have their complaint heard by the FWC, save for in exceptional circumstances — such as where there is a serious risk to health and safety, or evidence of victimisation.

What will the reforms mean for employers?

First clear statutory right of redress

If implemented, the reforms will mean that, for the first time in Australian history, individual employees will have a clear statutory right of recourse to seek redress for workplace bullying. However, with draft legislation yet to be released, it remains to be seen how the proposed amendments will interact with existing statutory and common law causes of action. For example, Mr Shorten has indicated that where the FWC refers a complaint to the WHS regulator for investigation, the employee will still be able to bring an adverse action claim.

Preparing for the proposed reforms

In preparation for the implementation of the proposed reforms, employers should ensure that they have robust policies and processes in place to deal with workplace bullying issues. They should also assess cultural attitudes to ensure that the issue is taken seriously at all levels of the organisation. While the reforms may take some time to be implemented, it is clear that bullying will continue to be a complex issue that will require a proactive and consistent response from employers.

Numbered days for reforms?

Finally, notwithstanding the above comments, it cannot be ignored that with a Federal election set for 14 September 2013 and the Coalition members' Dissenting Report failing to endorse the recommendation that the FWC be empowered to deal with bullying complaints, the days of any legislative reforms may be numbered.

Footnotes

¹Workplace Express, "Shorten says new bullying laws will tackle 'hidden scourge of workplaces'", 12 February 2013, available at http://www.workplaceexpress.com.au/.

²ABC, "Government fears extent of workplace bullying", 7.30, 25 September 2012, available at http://www.abc.net.au/.

³Crimes Act 1958 (Vic), section 21A.

⁴Australian Productivity Commission, Performance Benchmarking of Australian Business Regulation: Occupational Health and Safety, Research Report, March 2010

⁵House of Representatives Standing Committee on Education and Employment, Workplace Bullying: "We Just Want It to Stop", October 2012

⁶ibid., n 5, pp 227–32

⁷Australian Government, Australian Government Response to the Report "Workplace Bullying: 'We just want it to stop'", February 2013

⁸D Hurst, "Workplace bullies could face fines of up to $33,000", Sydney Morning Herald, 12 February 2013.

⁹Workplace Express, op. cit., n 1.

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. Persons listed may not be admitted in all states and territories.