Australia: "Poisonous Employee" Wins Claim Of Adverse Action

Last Updated: 4 October 2019
Article by Erin Lynch

This recent Federal Circuit Court decision reminds us of the need for employers to ensure that redundancies are implemented on the basis of genuine operational reasons.

A decision to terminate an employee's employment or disestablish an employee's position where there is a lack of evidence around the operational reasons for the decision is likely to be challenged, particularly where an employee has made a complaint or inquiry in relation to their employment.

The background

Ms Hein Minh Thi Tran (Ms Tran) filed a general protections claim, challenging the genuineness of her termination. The stated reason for Ms Tan's termination was redundancy. Ms Tan submitted that her employment was terminated as she exercised her workplace rights by complaining about the treatment she had received from her supervisors.

Ms Tran reported to Ms Eswari Chellappah (Ms Chellappah), the Systems Manager. Ms Chellappah in turn reported to the Deputy Chief Financial Officer, Mr David Lovelace (Mr Lovelace).

Throughout her employment Ms Tran made a number of complaints including:

  • lodging a grievance against Ms Chellappah concerning her workload;
  • complaining to her union about changes to her work hours;
  • raising with Mr Lovelace that she was feeling bullied by Ms Chellappah; and
  • that she had been doing her own work in addition to that of another employee.

In evidence was an email sent by Ms Chellappah in November 2015 that included the following detail:

"As you are aware Hein (Ms Tran) and Fouzia (Ms Zia) are difficult individuals and are poisonous to a team environment. I advised you some time back in the presence of Min-Ha that I am concerned if Hein would physically harm me. The university has known about Hein's behaviour for a while and has not acted upon it. Hein has taken me to the union twice and has approached HR a number of times to make complaints that are unfounded."

In October 2016, Mr Lovelace released a proposed change paper to all affected staff within the systems team. The paper proposed to disestablish Ms Tran's position. The change paper also proposed to disestablish a position within the Student One group, potentially affecting Ms Zia.

The adverse action

Section 342 of the Fair Work Act 2009 (Cth) (FW Act) sets out the meaning of when an employer takes "adverse action" against an employee and it includes:

  • dismissing an employee;
  • injuring an employee in his or her employment; or
  • altering the position of the employee to the employees prejudice; or
  • discriminating between the employee and other employees of the employer.

It was put to the Court that a proposed workplace restructure which alters the positon of the employee to the employer's prejudice, falls under the term of adverse action. It was accepted by the Court that the proposed restructure that disestablished Ms Tran's position amounted to adverse action within the meaning of the FW Act.

The reasons for the action

Where an employee makes an allegation of adverse action, the employer bears the onus of satisfying the Court that the adverse action was not taken for a prohibited reason. In this case, the prohibited reason was alleged to have been Ms Tran making complaints about Ms Chellappah.

The FW Act provides that the prohibited reason need only be one of multiple reasons for acting, in order to be a contravention. It is well established that the prohibited reason/s must be a "substantial or operative factor" in influencing the adverse action, or alternatively, an operative or immediate reason for acting.

This requires that the Court, at a minimum, conduct an enquiry into the state of mind of the decision-maker. Where multiple people are involved in the decision making process, such an enquiry may involve taking into account all these decision maker's reasons.

The Court found it difficult to accept an assertion by the employer that Ms Tran's complaints had not formed part of the decision to undertake a restructure, particularly when the restructure targeted Ms Tran and Ms Zia, both of who were described by Ms Chellappah, as "poisonous to the team environment".

The Court found that Ms Chellappah had a substantial role in the restructure proposal and it was essential from Mr Lovelace's view that Ms Chellappah was happy that it would achieve the desired outcome.

The Court was satisfied that the desired outcome of the restructure included the removal of Ms Tran and Ms Zia from employment with the employer and that a substantial and operative part of that reason was that Ms Tran had made complaints about Ms Chellappah.

Of particular importance in this case was that the employer principally relied upon the evidence of Mr Lovelace. The employer did not call Ms Chellappah or any other members of the Executive group to give evidence. For the Court this meant it was not satisfied that the employer had been able to rebut the presumption that the adverse action was taken for a prohibited reason (being the complaints).

The lessons

To limit the risk of a successful general protections claim, employers should ensure that:

  • the reason for termination of an employee's employment does not include a prohibited reason, particularly if there has been a history of conflict between a decision-maker and the employee;
  • there are objective criteria or reasons for the termination, including records of the reasons for selecting particular roles in a restructure; and
  • where possible, limit the number of decision-makers and, if necessary, prepare them for giving evidence on behalf of the employer.

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.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions