HOT OFF THE BENCH—DECISIONS OF INTEREST FROM THE AUSTRALIAN COURTS
Safety on site: just what the doctor ordered
Grant v BHP Coal [2014] FWCFB 3027
The Fair Work Commission has held that BHP was within its rights
to dismiss a boilermaker who refused to attend an appointment with
a company-nominated doctor to determine his fitness for
work.
The boilermaker had suffered a shoulder injury and consequently
had been off work recovering for eight months. Before his injury,
the boilermaker had been engaged in heavy manual labour on a mining
site at Peak Downs. He had provided medical certificates from
treating doctors proving the extent of the injury. However, BHP
required him to see its own physician so that it could assess the
duties for which he was fit, in accordance with its obligations
under s 39(1) of the Queensland Coal Mining and Health
Act.
Under that section, employers must ensure that workers are not
exposed to an unacceptable level of risk. This obligation, and the
complementary obligation of the employee to comply with
safety-related instructions of the coal mine operator, gave the
force of the law to BHP's instruction to attend the doctor, who
was an occupational health specialist. Consequently, the direction
was lawful and fell within the scope of the boilermaker's
contract. The boilermaker had consequently refused to obey a lawful
direction, and the employer was within its rights to terminate the
employment.
Key Takeaway
The key takeaway for employers is that there is no entitlement for
employees to refuse to comply with directions from their employers
that are expressly directly at maintaining safety on site.
Employees should be made aware of their obligations to comply with
such directions and the consequences that may flow from
disobedience.
Employees, not vigilantes
Tao Sun v CITIC Pacific Mining [2014] FWC
3839
The Fair Work Commission has held that allocating a project
outside the general job description of an employee is not bullying
and that an allegation of bullying does not permit an employee to
conduct his own surveillance of those who are alleged to be
conducting the bullying.
In Tao Sun [2014] FWC 3839, the managing director of
CITIC Pacific Mining had allocated a project to an IT manager that
was not covered by his job description and had assisted him with
it. The managing director had also monitored the performance of the
IT manager during the completion of the project, having regard to
his performance in the previous year. The IT manager perceived this
as bullying and had secretly accessed the managing director's
diary and files in order to substantiate that claim. The employee
had also secretly recorded meetings between himself and the
managing director in an attempt to provide further evidence for his
allegations.
The Commission held that the allocation of tasks outside the job
description of an employee was provided for by the contract. The
contract allowed the employer to "vary" an employee's
duties, as long as the majority of them remained within the scope
of the role. Accordingly, it did not constitute bullying. As to the
conduct of the employee, the Commission held that the employee was
still required to abide by the policies of the employer and could
not breach them in order to substantiate the claim. The Commission
also held that the employer was entitled to continuously examine
the performance of the employee and that such reviews were not
confined to a particular review period.
Key Takeaways
The decision reasserts three fundamental entitlements of
employers. The first is that there remains flexibility in
allocating tasks to employees on the basis of business requirements
where provided for in the contract of employment. Employers, within
reasonable bounds, control these allocations. The second is that
employers are entitled to continuously monitor the performance of
their employees. Third, employers have rights during bullying
investigations, and employees should be reminded that their conduct
during those investigations must remain within the limits of
company policies.
Big Stick for Sham Contractors
Director, Fair Work Building Inspectorate v Linkhill Pty
Ltd [2014] FCCA 1124
Sham contracting has earned Linkhill Pty Ltd a record fine of
$313,500 this month. The company had engaged workers to renovate
its properties on Flinders Lane and Collins St in Melbourne.
Representatives of Linkhill led the workers to understand that
their contracts were for services, not of employment, and
consequently avoided paying approximately $153,000 in entitlements
to them. Judge O'Sullivan held that the relationship between
Linkhill and those workers was in fact one of employment. As a
result, Linkhill was found guilty of sham contracting and was
ordered to pay a fine. The size of that fine came down to two
factors. First, representatives from Linkhill demonstrated no
contrition for the actions of the company. Second, Linkhill
representatives failed to appreciate the effect of sham contracting
on the employees themselves.
Key Takeaways
There are three key takeaways for employers. Despite the
diminution of the union movement, the risk of complaints of sham
contracting has not decreased. This is because the Fair Work
Building and Construction Ombudsman now undertakes investigations
into sham contracting on its own motion. Whether a relationship
between company and worker is classified as a contract for services
or one of employment is not dependent upon how the company itself
classifies the arrangement. The size of the fine will be in some
part determined by the attitude of the company to its conduct.
Employers should not make the mistake of considering that the cost
of sham contracting is less than the risk of punishment for it.
BREAKING NEWS
Union density at historic lows: a chance to negotiate individual contracts
The percentage of unionised workers across both the private and
public sectors reached a historic low last August, down to 17%.
56,400 workers left private sector unions, and 36,500 left those
serving in the public sector. All the declines occurred in the
States, predominately in manufacturing, healthcare and social
assistance, but membership increased in the Northern Territory and
the ACT.
The most significant drop in membership was in the manufacturing
industry where membership fell from 170,000 members in 2012 to
129,000 in 2013. Professor Peetz, of Griffith University,
attributes the losses to the contraction of that
industry.
Nationally, this represents the low watermark of union density,
from the most recent peak of 28% in 1998. 93% of the workers who
left unions in the period up to last August were employed on a
full-time basis. Consequently, the decline has created an important
opportunity for employers to restructure their full-time workforce
by negotiating individual contracts with their employees (rather
than negotiating enterprise agreements with unions) and thereby
minimise union involvement in their businesses.
Fair Work Commission increases national minimum wage
$640.90 a week, or $16.87 an hour, will be the new minimum wage
from 1 July 2014, the Fair Work Commission has
ruled.
In coming to this decision, the Commission took into account
"the deterioration in the relative living standards of
award-reliant workers, the needs of the low paid, the recent
widespread improvement in labour productivity growth, the
historically low levels of real unit labour costs and the absence
in aggregate of cost pressures". The Fair Work Commission
considered the increase to be equitable in circumstances where most
other employees' wages had increased substantially while there
had been almost no growth in the real value of award rates. Last
year's review increased award rates by 2.6% to $15.80 per
hour.
Employers should be aware that it is possible to apply for a
differential minimum wage to be applied to some award employees.
However, the review noted that the submissions from industry groups
to that effect did not demonstrate exceptional circumstances
justifying those orders.
Thanks to Andrew Berriman (Associate) for his assistance in the preparation of this Update.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.