‘Adverse action’ under the Fair Work Act

The Fair Work Act (Act), provides by section 340(1), that a person must not take adverse action against another person because the other person:

  • has a workplace right;

  • has, or has not, exercised a workplace right; or

  • proposes or proposes not to, or has at any time proposed or proposed not to, exercise a workplace right.

'Workplace rights’ are entitlements, benefits or responsibilities which are given to an employee under a workplace law, instrument or order by an industrial body.  ‘Workplace rights’ can include such activities as being a member of a union, participating in protected industrial action or making, varying or terminating an enterprise agreement. 

Adverse action includes not only various ‘prohibited’ reasons under the Act, but also conduct such as a warning, allocation of duties or discipline.  Further, it covers action by a principal against an independent contractor contracted to the principal and by the principal against an employee of that independent contractor.

Two cases about ‘adverse action’ have illustrated some of the parameters of what adverse action is in the workplace.

The Full Bench of the Federal Court in Barclay v The Board of Bendigo Regional Institute of Technical and Further Education [2011] FCAFC 14 considered the situation of a public servant who was also a union delegate, sent an email to members of the union employed by the employer alleging misconduct by unnamed co-employees in respect of their alleged creation of false documentation to satisfy an upcoming audit of the employer.  The employer sought more details of the allegations, but received no cooperation from the employee.  The employer then suspended the employee from his duties and internet access and directed the employee not attend the employer’s premises until such time as the issue was resolved. 

The employee subsequently claimed that his employer took this disciplinary action against him because of his activities as a union representative.  The employee claimed that this was ‘adverse action’ and contrary to the Act.

The employer on the other hand argued its action against the employee was due to the employee’s contravention of the Code of Conduct for Victorian Public Sector Employees and not because he was a union representative.  The employer said its actions did not constitute ‘adverse action’.

The Court said that in order to determine whether the action taken was adverse, the ‘real reason’ for the action had to be identified.  It then found that the employee, when sending the email alleging misconduct in the workplace, was performing his role as a union representative.  The Court said that sending such an email was ‘at the heart of his engagement in industrial activity’ as was the employee’s refusal to breach the confidence of those union members who had spoken to him.

The Court thus determined that the industrial activity of the employee as union representative was the ‘real reason’ for the actions of the employer.  The fact that the employer had chosen to characterise the employee’s conduct as being one and the same as his role as an officer of the union could not negate the real reason for the action.  The Court thus found that the employer’s conduct constituted adverse action.

In the second case, Australian Licensed Aircraft Engineers Association v Qantas Airways Ltd and Anor [2011] FMCA 58, the Federal Magistrates Court dealt with claims by an engineer that he was the subject to adverse action when seeking payment of entitlements under an Enterprise Bargaining Agreement (EBA) that applied to him.

The engineer, who worked for an airline, took a temporary posting overseas.  Upon returning, he sought payment of the various EBA entitlements, including payment of overtime.  The airline disputed the claimed entitlement was due to the engineer.  The airline then suspended all overseas postings from the depot at where the engineer was based until the issue was resolved.  The claim for entitlements was settled some months later.

The engineer argued that the airline had acted adversely against him by suspending the ‘benefit’ of his gaining an overseas posting because he sought to claim his EBA entitlements.

The airline acknowledged that it had suspended the overseas posting.  However, it said that this was a temporary measure while it sought to clarify the entitlements issue for all employees should they take an overseas posting.  The Court however found that the airline had taken adverse action against the engineer.

These cases show the care that an employer must take when implementing workplace policies to ensure that the sole reason for their action has no connection with any workplace right of an employee nor otherwise constitutes discriminatory conduct on the part of the employer.

Should you wish to know more about ‘adverse action’ please contact either:

Ian CurlewisMichael Jensen
PartnerSenior Associate
(08) 9288 6756(08) 9288 6944
ian.curlewis@lavanlegal.com.au..... michael.jensen@lavanlegal.com.au