Adverse action – a beginner’s guide

Adverse action – a beginner’s guide

One of the most fundamental principles that has emerged in the recent Australian industrial relations landscape is the concept of ‘adverse action’. That is, adverse action broadly speaking, is the notion of taking action against another person/entity where that party has a ‘workplace right’.

The relevant underpinning legislation for the adverse action is contained within section 340 of the Fair Work Act 2009 (the FW Act), which states that adverse action is:

(1)    A person must not take adverse action against another person:

a.       because the other person:

(i)      has a workplace right; or

(ii)     has, or has not, exercised a workplace right; or

(iii)    proposes or proposes not to, or has at any time proposed or proposed not to, exercise a workplace right; or

b.       to prevent the exercise of a workplace right by the other person.

These adverse action provisions fall under the broad expression of ‘general protections’. Significantly, recourse against adverse action involves civil action, which, unlike unfair dismissal, has no cap on the amount a party could be awarded.

It is important to note from the outside that the reference to a ‘person’ is not intended to limit its meaning to simply an individual. It can apply equally to employees, employers, independent contractors, trade unions, employer associations, body corporate etc.

The FW Act also details the meaning of a ‘workplace right’ at section 341, which states:

(1)    A person has a workplace right if the person:

a.       is entitled to the benefit of, or has a role or responsibility under a workplace law, workplace instrument or order made by an industrial body, or

b.       is able to initiate, or participate in, a process or proceedings under a workplace law or workplace instrument; or

c.       is able to make a complaint or inquiry:

(i)      to a person or body having the capacity under a workplace law to seek compliance with that law or a workplace instrument; or

(ii)     if the person is an employee – in relation to his or her employment.

Some of the more interesting recent adverse action cases include:

Mrs O vs Compuworld Pty Ltd: a female employee was awarded compensation after successfully arguing that she was terminated on the eve of commencing parental leave due to her pregnancy. The FWC determined that her employer took adverse action by dismissing her from a full-time position and offering her casual employment prior to her seeking medical attention relating to her pregnancy. She was awarded $50,000 in damages, including an amount of $15,000 for non-economic loss.

M v ERA Pacific Pty Ltd: a male employee who was dismissed for refusing to carry out work that he believed was unsafe succeeded in his claim. Justice Tonkin accepted that he had a workplace right under safety legislation to cease or refuse to carry out work if he (genuinely) believed it to be unsafe. He was awarded $23,000 in adverse action damages, with the former employer also required to pay $5,500 to the Commonwealth.

ABCC v Corestaff WA Pty Ltd: a 70-year-old male employee who was not recommended to a contractor as a suitable candidate by a labour-hire company solely due to his age was found to have suffered adverse action as he was refused employment on the basis of his age. The Federal Court imposed a fine of $20,000 on the labour-hire form and $9,000 on the contractor.

The onus of proof in adverse action cases rests upon the respondent. In other words, where an application is made alleging a person took action for a particular reason or with a particular intent, the courts will presume that the person has taken action for the alleged reason or with the alleged intent unless the person proves otherwise.

CFMEU v Bengalla Mining Pty Ltd: an employee who was the office holder of the union was warned and threatened with dismissal for attending a union board of management meeting. The evidence provided supported the employer’s argument that there was no issue with the employee attending the meeting or acting in his voluntary role within the union but that a written warning was issued for the employee’s breach of the company’s leave policy. The Court determined the adverse action onus was rebutted.

When dealing with employees, it is vital that the decision-maker is objective and makes a decision based on all of the available evidence pertaining to the situation. To do so will strongly support a claim that the employer took ‘reasonable management action’ rather than adverse action against the employee.

[2020] FWC 2569 [Note: An appeal pursuant to s.604 (C2020/4575) was lodged against this decision – refer to Full Bench decision dated 21 August 2020 [[2020] FWCFB 4250] for result of appeal.

M v Era Pacific Pty Ltd [2021] FCCA 1689 (23 July 2021)

Australian Building and Construction Commissioner v CoreStaff WA Pty Ltd [2020] FCA 893

Construction, Forestry, Mining and Energy Union v Bengalla Mining Company Pty Limited [2013] FCA 267 (28 March 2013)

For questions about discrimination, adverse action, or other employment questions, please contact Dean Cameron at Workforce Advisory Lawyers – We Know Employment Law on 1300 925 529, 0417 622 178 or via email to dean.cameron@workforceadvisory.com.au

Disclaimer: This information is provided as general advice on workplace relations and employment law. It does not constitute legal advice, and it is always advisable to seek further information regarding specific workplace issues. Liability limited by a scheme approved under professional standards legislation.

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