In a Federal Court decision, Justice Shariff has found that an aged care provider, St Basil's Homes ("Employer"), contravened the Fair Work Act 2009 (Cth) (FW Act) by dismissing a registered nurse ("Employee") in breach of her general protections under the Act. The Court held that the Employer took adverse action against the Employee both because she exercised her workplace right to make complaints contravening section 340(1)(a) and due to her race contravening section 351 of the FW Act .
Background
The Employee was of a Chinese background, and was employed at one of the Employers aged care facilities in Sydney. The Employee alleged she had made several complaints during 2019 regarding bullying, overwork, and discriminatory behaviour by her Filipino colleagues. She also raised concerns over staff members' refusing to assist her when providing care to residents at the home.
Rather than addressing these complaints, the employer issued a "first and final warning" in September 2019 and subsequently terminated her employment in January 2020, shortly after she made further complaints.
Legal Claims
Justice Rares found that the Employer took adverse action against the Employee:
- because she exercised a workplace right to make complaints, in breach of section 340(1)(a) of the FW Act; and
- because of her race, in breach of section 351 of the FW Act.
The Court rejected the Employer's argument and noted that that the Employer's justification was inconsistent, unsupported by evidence, and appeared to be an attempt to rationalise the true reasons for dismissal.
The Court's Findings – Termination of
Employment
Justice Shariff found that St Basil's unlawfully terminated the
Employee's employment in serious contravention of the FW Act,
both for exercising her workplace rights and because of her race.
He agreed with Justice Rares' findings that St Basil's
failed to properly investigate the Employee's complaints and
instead turned them against her, leading to her dismissal. Justice
Shariff rejected the employers defence, concluding the dismissal
was not based on genuine concerns about the Employee's conduct
but was instead discriminatory.
Court Decision:
Justice Shariff held that the Employee was entitled to compensation under section 545(2)(b) of the FW Act as her dismissal by the employer contravened her workplace rights and protections against racial discrimination.. His Honour ordered total compensation of $346,559, comprising of the following;
- $175,000 for past economic loss, noting that the Employee likely would have remained employed but for the contraventions, and that although evidence was limited, the Court had to make a reasoned estimation;
- $61,559 for future economic loss, based on an 18-month return-to-work timeframe and a reduced weekly capacity compared to her pre-dismissal hours, adjusted by 5% for a change in circumstances;
- $75,000 in general damages for distress, hurt, and humiliation arising from the contraventions, and
- $10,000 for future out-of-pocket psychological and psychiatric care expenses.
In addition to compensation, Justice Shariff imposed civil penalties under the FW Act, ordering St Basil's pay $45,000 for the racial discrimination breach (s 351) and $15,000 for the workplace rights contravention (s 340).
Takeaways for Employers
This decision reinforces the importance of genuinely investigating employee complaints, especially those involving discrimination or workplace bullying. Further employers must be cautious in how they respond to complaints and adverse action taken shortly after an employee raises concerns. It is clear that the financial cost to an employer can be significant if it fails to handle employee complaints appropriately. In addition to potential civil penalties employers also need to consider the risk to reputational damage which can have a significant impact on a business.
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