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Employment Law Case Studies

Employment Law Case Studies

Employment law affects any business that requires a workforce. There are some elements of employment law, such as unfair dismissal and workplace bullying, which are of particular concern as many employers make the mistake of not following formal procedure and subsequently losing claims made against them in these areas. For example, an employer who does not have a social media clause in its code of conduct or employment contracts before firing an employee for misconduct relating to social media will undoubtedly encounter difficulty should a claim of unfair dismissal be made.

This article will examine these areas of employment law with a relevant case study for each. These laws will first be briefly explained for context.

Unfair dismissal

In Victoria, what does or does not constitute unfair dismissal is determined on a case-by-case basis by the Fair Work Commission. Generally, if an employee is dismissed and the commission finds that the dismissal was unjust, harsh, or unreasonable, the dismissed employee may be awarded an unfair dismissal remedy by the Commission. Other possible grounds for the award of a remedy include: if the dismissal was not the result of genuine redundancy or lawful termination, or in the case of a small business, the dismissal was made in contravention of the Small Business Fair Dismissal Code. Small businesses are businesses that employ fewer than 15 people.

In Victoria, all employees are covered by unfair dismissal laws.

Employees are eligible to make an unfair dismissal claim if they have completed a minimum employment period of one year for small businesses or six months for businesses with more than 15 employees. The application must be made within 21 days of the dismissal having occurred.

There is a large number of factors that would be taken into account by the Commission in deciding whether a dismissal may be deemed as harsh, unjust or unreasonable. Generally, this relates to whether or not an employee was given adequate warnings, guidance, and opportunities to improve their behaviour before the dismissal occurred. Employers should be aware of formalities regarding written warnings and keeping a record of any misconduct committed by employees, as these will prove to be valuable should a claim be brought to the Commission.

Case study – unfair dismissal

Anderson v Thiess Pty Ltd [2014] FWC 6568

In this case, a certain Mr Anderson was dismissed from his employment with Thiess Pty Ltd following a work email sent by Mr Anderson which was deemed to be seriously offensive to people of Islamic faith. Thiess did have policies in place which clearly prohibited such conduct by employees, and the Commission found that the incident had the capacity to cause significant damage to Thiess’s reputation, yet damages were still awarded to Mr Anderson.

The Commission awarded $28,000 in compensation to Mr Anderson on the basis that the dismissal was unreasonable and harsh, in spite of  the potential damage suffered by the employer, due to the fact that:

  • Mr Anderson was 65 years old at the time of the dismissal, and it would be difficult for him to obtain other employment;
  • Thiess had failed to issue written warnings to Mr Anderson, and had also failed to record the occurrence of previous incidents;
  • Thiess denied Mr Anderson the chance to understand and accept that his conduct was unacceptable. Mr Anderson also did not have the opportunity to apologise and accept other disciplinary measures before being dismissed.

This case demonstrates the importance of following a strict terminations policy when dealing with employees engaging in inappropriate conduct. Even if an employee has acted in a way that is damaging to the employer, the employer must adhere to the formality requirements set out by the Fair Work Commission when dismissing an employee. This includes giving adequate written and verbal warnings, recording incidents in a file for later reference, and attempting to counsel and guide the employee into behaving according to company policy.

Workplace bullying

Bullying is a pervasive workplace issue, which has a range of negative consequences for both employers and employees. Employees who experience bullying can suffer significantly in terms of mental and physical health, as well as the loss of their right to work in safe conditions. Employers may be required to compensate employees who experience bullying if measures aren’t taken to address the problem.

The Fair Work Commission describes bullying as repeated unreasonable behaviour towards another worker or workers which constitutes a risk to workplace health and safety. This unreasonable behaviour could include intimidating or aggressive actions, targeted humiliation, rumour spreading, exclusion, and other inappropriate conduct.

Employers should have a grievance procedure in place to ensure that such a problem can be dealt with internally without a claim being made to external authorities. An effective grievance procedure should enable affected employees to discuss bullying with managers, who then take meaningful action.

Case study – workplace bullying

In a case published by the Australian Government’s Comcare agency, an employee developed a psychiatric condition following persistent bullying as a result of her being promoted to a management position in a restructuring move by her employer.

The worker did not receive any management training prior to her appointment as team leader, and there was widespread bitterness in the team about the removal of the previous team leader. Several team members reportedly engaged in increasingly hostile behaviour towards the new team leader, including spreading rumours, disobeying requests, making offensive comments, being rude, and failing to help the team leader when she was very busy and clearly required assistance.

The team members then convened a meeting (too which the bullied employee was not invited), where a document listing complaints about the new team leader was drafted and given to the team leader’s manager.

The manager accepted the document, and refused to intervene in any meaningful way when requested to do so by the bullied employee. The bullied employee sought assistance from other managers, who did not intervene, until finally she was forced to leave her position due to the development of a psychiatric condition.

The bullied employee took legal action, where a judge found that the employer was negligent in its duties to create a safe working environment. It was found that the managers involved had the capacity to take action that would have prevented the damage caused to the bullied employee, but failed to do so.

The bullied worker received compensation of $339,722 at the expense of her employer as a result of psychological injury acquired in the workplace.

This case demonstrates the clear need for employers to be responsive to bullying complaints so that these sorts of cases do not occur. Bullying is an issue that gets worse the longer it is left unaddressed.

Helpful links:

Fair Work Ombudsman

Fairwork – Rights and obligations

Fairwork – Protection from discrimination at work

Human rights – workplace discrimination harassment and bullying