Stephen Edwards LLB Call now 0427329514   -   Employment Law and Fair Work Consultant
Blog and issues commentary

Non-monetary benefits and the high income threshold

Regulation 3.05(6) of the Fair Work Regulations provides that the value of some benefits other than the payment of money are to be included in the high income threshold for the purpose of sec 382 of the Act.
             “(6)  If:(a)  the person is entitled to receive, or has received, a benefit in accordance with an agreement between the person and the person's employer; and (b)  the benefit is not an entitlement to a payment of money and is not a non-monetary benefit within the meaning of subsection 332(3) of the Act; and   (c)  the FWC is satisfied, having regard to the circumstances, that: (i)  it should consider the benefit for the purpose of assessing whether the high income threshold applies to a person at the time of the dismissal; and (ii)  a reasonable money value of the benefit has not been agreed by the person and the employer; and(iii)  the FWC can estimate a real or notional money value of the benefit; the real or notional money value of the benefit estimated by the FWC is an amount for subparagraph 382(b)(iii) of the Act”.

Duty of good faith and fidelity and jurisdiction

A hotel chef who sued his former in the Federal Court for unpaid accrued annual leave as a “civil remedy provision conferred as a National Employment Standard and under secs 44, 539(1) and 545 of the Fair Work Act 2009, has been ordered to pay almost $73,000 in “equitable compensation” for damages caused to his employer by his breach of express and implied terms of his employment contract. The court made factual findings that the employee had failed to disclose that chicken schnitzels being brought by the company were being sold at a price above cost by a business in which he and his wife had an interest, without disclosing either of these material facts to the employer.

Confidential information in the workplace

The Federal Court has granted an interlocutory injunction restraining  a former employee who had been dismissed for breaching his employment contract by setting up a business in opposition to that of his employer when his employment contract prohibited him from approaching his former employer’s clients even though his employment contract did not contain a classic restraint of trade prohibition.  Justice Foster cited the “springboard principle” as the basis for the order and cited the following dicta from a leading case as its rationale.

Procedural fairness and unfair dismissal

The need to ensure that there is a reasonable opportunity for an employee whose employment is at risk of being terminated for cause, whether a breach of standards or misconduct, to understand the allegation and to respond to it in a meaningful way is evident in Dent v Halliburton Australia Pty Ltd (2014) FWC 5692. Fair Work Commissioner Booth said she accepted the employer’s argument, relying on the Federal Court's 1993 ruling in Schaale v Hoechts that its "investigation does not need to be without flaw.

Unfair dismissal; valid reason for dismissal yet unfair

That there can be a completely valid reason to dismiss an employee, yet it may be held to be unfair is extremely well illustrated by Cannan and Fuller v Nyrstar Hobart Pty Ltd (2014) FWC 5072 delivered on 19 September 2014. This was a case in which the Commission agreed with the employer that there was a long history of the employees who were dismissed having been guilty of bullying their supervisor, namely "unpleasant, abusive, insulting, critical, undermining, persistent demands, obstructive, mocking, demeaning, belittling [and] humiliating” behaviour, yet that the dismissal was held to be unfair due to the company having turned a blind eye to it for many years and a flawed process which denied the employees procedural fairness. The case is also a warning to employers that despite what appears to have been great care having been taken by the company, it was still lumbered with responsibility for objective errors having been made in the process.

Support person; unfair dismissal

A Full Bench of the Fair Work Commission has ruled that an employee is not entitled to be accompanied by a support person to an investigation about an incident and that if it is just that, an investigation about facts with no conclusion being reached about the implications, sub-sec 387 of the Fair Work Act is not invoked to trigger such an entitlement until there are discussions relating to a dismissal. Accordingly if an employer merely launches an investigation to determine relevant facts, and holds an open mind about the implications for a particular employee until those discussions are held, the absence of a support person is not relevant.

What is included in the high income threshold

Sec 332 of the Fair Work Act provides that “the agreed money value of non-monetary benefits (defined in sub-sec 332(3) as “a reasonable money value (which) has been agreed by the employer and the employee”) are included in an employee’s earnings for the purposes of calculating whether the employee’s earnings exceed the high income threshold. The Fair Work Commission has held that the  value of the actual private use of a company supplied motor vehicle is not relevant to determining the agreed money value if, as in that case, the value had been signed off in a contract of employment by both parties.

Unfair dismissal

A decision of the Fair Work Commission has concluded that a more objective and thorough investigation into whether a tram driver had been spotted using his mobile phone whilst driving a tram through an intersection would have revealed that the driver’s version of events, namely that his mobile phone and charger had spilled from his bag and he was merely picking them up was “on the balance of probabilities” likely to be true. Accordingly the Commission held that a dismissal was unfair. According to the Commissioner this would have been apparent if the company had conducted a “meaningful engagement” with the employee in the investigation.

Racial villification; unfair dismissal

The Fair Work Commission has awarded a former employee aged 65 years around $29,000 in compensation for unfair dismissal despite the Commission concluding that his employer had a valid reason for dismissing him because he had used the company’s intranet in an attempt to publish an “offensive” anti-Muslim e-mail. "The covering text of the email is highly offensive to persons of the Muslim faith and I do not intend to give it any air-play by setting it out in this decision," Deputy President Asbury said.

Sexual harassment in the workplace

The owners of a restaurant have been ordered to pay $5,000 in compensation for their chef sexually harassing a former kitchenhand.  The tribunal found that the chef consistently made unwanted sexual advances to the kitchenhand and also that there had been a couple of occasions when the chef made inappropriate and unwanted physical contact. The owners of the restaurant were of course found vicariously liable for the chef’s conduct. ABC v DEF Restaurant (2014) NSWCATAD 140. 

Redeployment obligations in redundancies

A Full Bench of the Fair Work Commission has affirmed that in justifying a redundancy where the employee puts in issue that the employee should have been redeployed elsewhere, the evidentiary burden of proof of reasonableness lies upon the employer to satisfy the requirements of sec 389(2). Once the employer has adduced evidence of the steps which were taken to consider redeployment, the onus shifts back to the employee to prove that the measures were not reasonable enough. The case might also be authority for the proposition that an employer is not bound to consider dismissing  other employees or contractors as part of the pursuit of redeployment options.

Industrial torts

The industrial tort of intimidation is alive and well in Australia despite a recent attempt to persuade the Victorian Supreme Court that it is not recognized in Australia.
The nature of the tort was put thus by Justice Derham.
In Sid Ross, the NSW Court of Appeal found "strong authority for the proposition that if A, intending to injure C, by threatening B that he will commit an unlawful act against B, unless B refrains from The tort of intimidation is alive and well in Australian common law, despite a exercising his legal right to deal with C, induces B to refrain from so doing, A commits a wrong actionable at the suit of C".

General protections breach procedures

An allegation of the dismissal of an employee by an employer in breach of the general protections provisions of the Fair Work Act is dealt with by the Federal Court if not first settled by conciliation in the Fair Work Commission. In many ways this is unfortunate because the Fair Work Commission is a much more user friendly place than the Federal Court, where the practices and procedures are very difficult for an unrepresented litigant to navigate. In contrast the Fair Work Commission is expressly commanded by the Fair Work Act (secs 590, 591) not to be bound by the rules of evidence and procedure which apply in the courts and a lawyer or paid agent is required to obtain leave to represent a party in proceedings before the Commission (although in reality this is a formality normally because the members of the Commission by and large very much welcome the participation of experienced advocates because they speed up such proceedings, focus on what is relevant to the case and do not generally become distracted by red herrings).

Swearing too aggressively?; unfair dismissal

The issue whether swearing and boorish conduct at work can constitute mere ribaldry (or as the Fair Work Commission put it “everyday descriptive language”) or misconduct justifying dismissal because it can fairly be described as aggressive and  malicious swearing at a colleague was at the heart of Rikihana v Mermaid Marine Vessel Ops Ltd (2014) FWC 6314 delivered on 12 September 2014. The employee concerned was a maritime worker and although a certain amount of swearing was mundane in such a workplace, the Commissioner said that "I am satisfied from the evidence that neither before nor after the new code of conduct was introduced was it the norm nor was it commonplace for employees to direct swearing at individuals as distinct from using swear words as part of their normal conversations.

Unfair dismissal and misconduct

A Full Bench of the Fair Work Commission has upheld an appeal from a surprising decision which I queried at the time ordering the reinstatement of a captain of a Sydney ferry which crashed after the employee had consumed marijuana contrary to a no tolerance policy to the consumption of illicit drugs by its employees. At first instance the Commission had focussed on the act that there were several mitigating circumstances despite the Commission having then concluded that there was a valid reason for dismissal, including the employee’s length of service and that he had consumed the drug for pain relief.

Employer's policies and procedures; enforceable?

The question whether an employer’s policies and procedures can create enforceable obligations on the employer remains unanswered following the decision of the High Court in Barker’s case CBA v Barker (2014) HCA 32 delivered on 10 September 2014. In that rather tortuous case, the High Court ultimately held that contrary to the common law position which has been created by the English courts, and employment contract in Australia is not to be interpreted on the basis that it contains an implied mutual duty of trust and confidence.

Implied terms; Barker's case

The High Court has definitively ruled that Australian common law should not recognize a term of mutual trust and confidence as an implied term of employment contracts. The leading judgment said the primary question raised by the Commonwealth Bank's appeal was "whether, under the common law of Australia, employment contracts contain a term that neither party will, without reasonable cause, conduct itself in a manner likely to destroy or seriously damage the relationship of trust and confidence between them".

Sexual harassment; damages

Richardson v Oracle Corporation Australia Ltd (2014) FCAFC 82 is an important decision of a Full Bench of the Federal Court which heralds a new approach to the assessment of compensation for sexual harassment and an acknowledgment that contemporary standards require a dramatic increase in awards of damages for proven breaches for non-economic loss, rather than mere tokenism which is a fair description of cases on this point leading up to this decision.

Foreign offshore workers' status

           

Since 30 June 2014, workers engaged in an offshore resources activity are deemed to be in the Australian Migration zone and consequently become foreign offshore workers and thus entitled to minimum employment standards under Australian employment law. This legal change was effected by the Government issuing a directive under the Migration Act.

Breach of employment contract

Very often, particularly for senior executives,  an employment contract will provide that the employer is entitled to terminate the employment of an employee if the employee commits any serious or persistent breach of the agreement and the breach is not remedied within a particular time (generally 14 or 21 days) of the employee receiving a direction of the company (generally through the board of directors) to do so.
What does the law require for the breach to be remedied? What if the conduct has already occurred?
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Non-monetary benefits and the high income threshold
Duty of good faith and fidelity and jurisdiction
Confidential information in the workplace
Procedural fairness and unfair dismissal
Unfair dismissal; valid reason for dismissal yet unfair

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