It is essential that when making decisions that affect
employees, employers take into account provisions of the Fair
Work Act 2009 (Cth) (the "Act"). Employers need to
be aware that some decisions which may seem reasonable to them, and
in the best interests of an employee, may offend the law.
The Federal Circuit Court in Sagona v. R & C
Piccoli Investments Pty Ltd & Ors  FCCA 875
(30 April 2014) found that a photography business had
constructively dismissed an employee. The Court accepted the
employee's evidence that she felt she had no choice but to
In this case, Ms Sagona informed her employer that she was
pregnant and that she would be taking a period of parental leave.
Upon receiving the notice that Ms Sagona was pregnant, the employer
sought to alter her duties because:
it was their belief that "it was not a good look" for
customers to see a pregnant woman working in the business and, it
would make the employer look like it was a "slave
it was their belief that Ms Sagona would appear
"desperate" if she worked while she was noticeably
one of the directors of the employer was particularly concerned
about Ms Sagona losing the baby if she continued to undertaken her
normal duties as that director had lost a baby in the past.
It is apparent that the decisions made by the directors of the
employer were influenced by their own life experiences. The
decision made and the manner in which the employer sought to alter
Ms Sagona's duties, no matter how well meaning, was in breach
of the law.
The Court held that in this case the employer had taken adverse
action against Ms Sagona and awarded her compensation in the sum of
Employee Protections – Exercise a workplace
Section 340 – 341 of the Act protects an employee from
adverse treatment (for example dismissal or a demotion) where the
reason, or one of the reasons, for the employer's action
include that the employee has exercised a "workplace
A workplace right includes the following:
an employee making a complaint or enquiry in relation to his or
an employee taking sick leave, annual leave, parental leave or
an employee being a member of a union;
an employee taking protected industrial action;
an employee undergoing proceedings either in Court or at the
Fair Work Commission under Workplace Law or a Workplace
The actual adverse action taken against the employee may, for
example, be dismissal, issuing a written warning, reducing or
responsibility of the employee, suspension from duties or
pressuring an employee to sign an individual flexibility
Examples of cases in which adverse action was found to be taken
by employers for a reason prohibited under the Act include:
In Owens v Allied Express Transport Pty Ltd 
FWAFB 2929 (10 June 2011) an employer proposed a change in working
conditions to accommodate an employee's pregnancy. The employer
and employee agreed that the employee would work in a less
difficult role as the employee was pregnant. However, when the
employer informed the employee that there would be a significant
reduction in salary for the new role, the employee refused to agree
and regarded herself as having been dismissed. This was found to
constitute a termination of employment at the initiative of the
In Silver v Rogers & Rogers (2012) 224 IR 439, the
Applicant became unwell with pneumonia and golden staph and was
subsequently off work for a significant period of time. His
employment was terminated due to economic circumstances and
health-related issues. The Court found that the Applicant's
physical disability and health issues were an operative reason for
In Pavolvich v Atlantic Contractors Pty Ltd 
FMCA 1080 (26 October 2012), the Applicant was terminated because
he was "always sick". The Court found that the Applicant
had been terminated due to his sickness which was held to be a
Even where a decision seems to an employer to be reasonable and
in some circumstances in the best interests of the employee, it may
be in breach of the Act. Employers should be very careful to ensure
decisions made to alter an employee's position, status,
responsibility or other term of employment are not influenced by
reasons prohibited under the Act.
If an employer is unsure about whether or not a decision is in
breach of the Act, they should seek legal advice.
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.
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When employees engage in out-of-hours misconduct, it can negatively affect the reputation of the employer.
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