Australia: Managing Fair Work Act complaints: When is a workplace complaint more than a mere discussion or consultation?

Last Updated: 20 September 2016
Article by Abraham Ash

Most Read Contributor in Australia, October 2017

A recent decision of the Federal Circuit Court has shed light on the types of complaints that may fall within the general protections regime of the Fair Work Act 2009 (Cth).

The general protections regime in the Fair Work Act 2009 (Cth) provides protection to employees who have, or have exercised, a workplace right.

The concept of a workplace right is defined in the Fair Work Act to include a "complaint or inquiry" made by an employee in relation to his or her employment. While this may seem relatively straightforward, what is a complaint or inquiry can be a vexed issue. For example, when will making a complaint be distinguished from a mere discussion? When will an inquiry be considered a formal inquiry in relation to an employee's employment, rather than a generic consultation or catch-up?

This issue was recently considered by Judge McNab in McGowan v Direct Mail and Marketing Pty Ltd [2016] FCCA 2227, which has shed additional light on the types of complaints that may be afforded protection under the federal adverse action regime, and those that will not constitute a complaint.

Mr McGowan is dismissed

Mr McGowan was the Group General Manager of Direct Mail and Marketing Pty Ltd.

On 17 November 2014, the Mr McGowan's performance was terminated on the basis of poor performance. He subsequently lodged a general protections claim with the Federal Circuit Court under section 340(1)(a)(ii) of the Fair Work Act asserting that the employer had taken adverse action against him when he exercised his workplace right to make a complaint or inquiry in relation to his employment.

The complaints and alleged adverse action

Mr McGowan argued that his employment had been terminated not because of performance, but because he had made complaints or inquiries in relation to his employment shortly before his termination. Specifically, he argued that he had:

  • made complaints or inquiries to an external human resources consultant about being excluded from key communications, that his role was not required by the employer and that the Managing Director had taken action without consulting him or other managers; and
  • made complaints or inquiries during a meeting with the HR consultant and Managing Director about being "undermined and usurped" by the Managing Director.

His employer, however, argued that it did not take adverse action against Mr McGowan, and that it had terminated his employment because he had performed poorly and had exhibited "rude and crude conduct" which was inconsistent with his ongoing employment.

Dismissal not related to a workplace complaint

Judge McNab found in favour of the employer, concluding that it had validly terminated Mr McGowan's employment on the basis of his poor performance and that the termination paid no regard to his complaints.

In relation to Mr McGowan's catch-up with the HR consultant, Judge McNab ruled that this:

"was not in the nature of a complaint but was in the nature of effectively a consultation or discussion with [the HR consultant] in relation to his role...Even if it did constitute a complaint for the purposes of the FW Act, the termination was not because of the exchange that occurred at that meeting".

With respect to his complaints that he had been "undermined and usurped", Judge McNab determined that these complaints were made during a formal meeting regarding his role and performance, and that:

"...there was sufficient detail in the meeting request to constitute the expression of a grievance in the sense that Mr McGowan conveyed that he was not happy with the way he was being treated by [the Managing Director] and wanted changes made...In my view that conversation was a complaint or enquiry for the purposes of section 341(1)(c)(i)".

Narrow or broad - which is the preferred approach?

The courts have taken both a narrow and broad view to the types of complaints that may be covered by the FW Act.

The narrow view, as favoured by the court in Shea v TRUenergy Services Pty Ltd (No. 6) [2014] FCA 271, is that a complaint must convey a grievance, a finding of fault or accusation which:

A narrow view was also taken in Harrison v In Control Pty Ltd (2013) 273 FLR 190, in which it was found that the complaint must originate from or be an incident of the contractual arrangements or statutory framework surrounding the employment.

On the other hand, a broad view was taken in the decision of Devonshire v Magellan Powertronics Pty Ltd (2013) 275 FLR 273, in which it was held that a complaint can attract the protection of the adverse action regime even if there are no formal complaint mechanisms in place to address the complaint or inquiry.

In the McGowan decision, Judge McNab applied the principles in Shea and took a narrow approach to the types of complaints that may legitimately fall within the scope of a workplace right under the Fair Work Act.

Key considerations for employers

When an employee raises a work-related grievance, employers must take care to ensure that disciplinary or performance management procedures are handled carefully and appropriately, and that any decision to terminate an employee's employment is based on legitimate reasons that are unrelated to any complaints raised by the employee prior to his or her dismissal.

In light of the McGowan decision and other relevant authorities, employers must exercise caution when seeking to terminate the employment of employees who have raised a concurrent employment-related issue so as to avoid any inference that adverse action was taken against an employee upon termination because of the making of a complaint or inquiry.

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.

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