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Employment Law – Incapacity Not a Refusal to Work

Employment Law – Background

The Fair Work Commission has criticised a company for misconstruing an employee’s extended absence on certified sick leave as a refusal to work.

Most noteworthy, the HR team dismissed the mentally unwell supervisor via email.

The decision highlights the importance of due process in the dismissal of employees while having regard to human dignity.

Employment Law – Facts

In essence:

  • the customer service supervisor was employed at Komatsu
  • the supervisor said he was “directed” to take sick leave in March 2015 due to “health and well-being”
  • he failed to meet his sales budget KPI’s. As a result, he was placed on a performance improvement plan in August 2015
  • the supervisor began experiencing mental health issues in March 2016. Consequently, he was taken off the performance improvement plan
  • furthermore, he experienced difficulties with his new manager which also contributed to his mental health problems
  • Komatsu encouraged the supervisor to participate in a return to work plan
  • additionally, Komatsu reconfigured its management structures to prevent the supervisor interacting with his previous manager
  • the supervisor was dismissed via email in November 2016

Employment Law – Decision

The Fair Work Commission:

  • held that the medical evidence confirmed the employee’s incapacity to work rather than his refusal to perform work
  • held there was no valid reason for the dismissal
  • underlined the need to establish the illness was not genuine in order to treat absence as a refusal to work
  • noted the mandatory opportunity for an employee to be provided with a ‘show cause’ meeting before any dismissal is made
  • stressed that dismissal via electronic means should be “strenuously avoided”
  • suggested Komatsu review its employee management practices
  • therefore ordered Komatsu to pay the supervisor $1,250 in compensation

The decision is available for you to read through the hyperlink:

John Finnegan v Komatsu Forklift Australia Pty Ltd [2017] FWC 2433 (10 May 2017) [...]  READ MORE →

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Employment Law – FWC Slams Poor Agreement Drafting

Employment Law – Background

A poorly drafted enterprise agreement has been criticised by the Fair Work Commission (FWC). The case was brought by the Electrical Trades Union (ETU) and the Communications Union (CEPU) against electrical contractor Kentz Pty Ltd (Kentz) in dispute of a clause requiring the purchase of particular income protection products.

The case was initially heard in February this year when Commissioner Michelle Bissett found “no ambiguity” in the wording of the contractual requirement to purchase income protection insurance. However, an appeal was permitted by the Commission because the decision was “attended with sufficient doubt” to permit a rehearing. The full bench of the FWC reaffirmed the earlier decision. Furthermore, it highlights the importance of clear drafting of enterprise agreements in employment law. [...]  READ MORE →

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Employment Law – Landmark Sham Contracting Case

Employment Law – Background

In March 2015, the Fair Work Ombudsman (FWO) brought a case against Quest South Perth Holdings Pty Ltd (Quest) for breaches of the Fair Work Act 2009 (Cth) (the Act). In a long-running legal saga, the Federal Court found that Quest and Contracting Solutions Pty Ltd had not contravened the Act by moving employees onto independent contractor arrangements. By the end of 2015, the High Court of Australia overturned the Federal Court ruling and therefore found Quest had engaged employees in a ‘triangular’ sham contracting arrangement. [...]  READ MORE →

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Employment Law – Informal Approach Acceptable

Employment Law – Background

Recently, the Fair Work Commission refused an unfair dismissal claim by an employee who was terminated without receiving prior formal warnings.

The case demonstrates the flexibility of the Fair Work Commission in accepting an employer’s informal efforts to address workplace issues.

Employment Law – Facts

In essence:

  • in July 2015, the FMG Personnel Services (FMG) inventory controller and his manager discussed his work requirements for the next 12 months
  • it became evident the employee “lacked the necessary skills, capabilities and knowledge to adequately perform his role and that his manner and attitude to customers and internal personnel was unsatisfactory”
  • the manager believed the employee failed to grasp concepts required of his role or prioritise duties
  • the employee was alleged to have failed to comply with business processes. Furthermore, he was considered to be incapable of maintaining effective work relationships
  • from September 2015, a manager ‘informally’ performance managed the employee for a period of 10 months. In this period, the seating arrangement was changed to sit the employee next to the manager for daily coaching and individual training sessions
  • on one occasion, the manager conducted training for the entire team offsite despite the training being targeted only at the employee
  • in July 2016, FMG placed the employee on a performance improvement plan. Following this, the employee emailed HR denying any supposed performance issues
  • customers consequently eventually refused to communicate with the employee
  • consequently, the employee was dismissed in August 2016
  • the employee made a claim for unfair dismissal because he alleged there were no formal warnings, contemporaneous file notes or formal performance management

Employment Law – Fair Work Commission Decision

The Fair Work Commission:

  • held there was a “complete divergence” between the views of FMG and the employee
  • stated “…FMG sought to clearly communicate to [the inventory controller] what their performance expectations were and that FMG diligently endeavoured to assist [the inventory controller] to achieve these expectations”
  • considered FMG had reasonable grounds to conclude an informal approach was likely to be more successful
  • furthermore, accepted FMG had genuine and reasonable concerns about the employee’s ability to comprehend deficiencies in his performance. In addition, the employee believed training and coaching were “ordinary workplace conversations”
  • stated that such “exchanges were intended to be, and are properly characterised as, informal performance management”

The decision is available for you to read through the following hyperlink:

Mr Robert Etienne v FMG Personnel Services Pty Ltd [2017] FWC 1637 (25 May 2017)

Employment law – Tips for Employers

Our Matthews Folbigg Workplace Solutions employment law team recommends employers: [...]  READ MORE →

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Fair Work Commission – Investigation Procedural Deficiencies

Background

The Fair Work Commission has found that the sacking of a mother and daughter by an abortion clinic was unfair because the clinic failed to adequately investigate the allegations of fraud and bullying made against the pair [1].

Facts

In essence:

  • There were allegations that the practice manager of the clinic bullied nurses by threatening to dismiss them because they had left unconscious patients unattended.
  • Further allegations were made that both the practice manager and her receptionist daughter were incorrectly recording their hours, such as by failing to record cigarette breaks and long lunches
  • In denying the claims, both the practice manager and receptionist claimed that the director of the clinic had concocted the allegations in order replace them with his own wife and daughter.
  • There were also claims that the director stated he could not “afford to have himself or his business” involved in anti-bullying application brought by the nurses at the Fair Work Commission

Fair Work Commission – Decision

The Fair Work Commission:

  • Concluded that the dismissal was unfair because the director failed to conduct a comprehensive investigation into the bullying allegations or attempt to resolve the problems between the parties
  • Although the applicant’s inaccurate recording of time and wages was a valid reason for dismissal, the respondents argument was undermined by the “significant procedural deficiencies” in the dismissal process, including not enough time being given to the employees to prepare a “cogent” response to the allegations
  • Found that ultimately it was “underlying commercial and interpersonal factors between staff” that led to the director’s decision to terminate the practice managers employment
  • Awarded the practice manager $4500 in compensation for four weeks’ wages.
  • However, the Fair Work Commission declined to make orders to compensate the receptionist as she had “promptly secured alternative employment”

Employment Law – Tips for Employers

Our Matthews Folbigg Workplace Solutions employment law team recommends employers:

  • review this Fair Work Commission decision
  • seek the assistance of an employment lawyer to understand the impacts of this decision
  • ensure that where allegations of misconduct arise in the workplace, that those allegations are properly investigated and the employee concerned is given a fair opportunity to respond to the allegations
  • ensure that where disciplinary action is contemplated, in particular potential dismissal, that a procedurally fair process is followed prior to any decision being made
  • fairly, consistently and lawfully respond to breaches of employment contracts and employment law policies
  • damages can apply for breaches of employment contracts and some employment law policies (which an employment lawyer can advise on)
  • raise any employment law questions with an employment lawyer

Employment Law – More Information

Please call the leading employment lawyers in Parramatta, the Matthews Folbigg Workplace Solutions employment law team on 9635-7966 to speak with one of our employment lawyers. [...]  READ MORE →

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Employment Law – Unenforceable Restraints

Employment Law – Background

An ex-employee’s post-termination restraints have been deemed unenforceable by the Supreme Court of Victoria. This case highlights the impact of employer’s actions on the validity of a contract of employment. Furthermore, it highlights the limits of post-employment restraints in employment law. The failure to remunerate an employee can result in a constructive dismissal. Consequently, post-employment restraints may become ineffective.

Post-employment restraints are inserted in contracts of employment to prevent an employee working elsewhere. In addition, it prevents the ex-employee from engaging with former clients for a period of time. [...]  READ MORE →

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Employment Law – Ex-Director Restrained by IP

Employment Law – Background

Climate Change Technology P/L (‘CCT’) has sought an interlocutory injunction to restrain a former director and inventor of a thermal energy battery.  The employment law decision raises the importance of documenting relationships.

Employment Law – Facts

In essence:

  • first of all, Dr Patrick Glynn was employed by CCT between 2011 and 2016. He was its principal research officer and director. In addition, Dr Glynn was appointed its chief executive towards the end of his tenure at CCT
  • he invented a thermal energy storage device and assigned a patent to it in 2011. Furthermore, he signed an intellectual property agreement
  • CCT submitted that they spent about $5 million over the last six years on researching and developing the device and associated technology
  • when Dr Glynn quit in 2016, he allegedly retained intellectual property and confidential information in relation to the device. Furthermore, he set up another research and development company and an umbrella company
  • in addition, CCT alleged that Dr Glynn and the companies had been negotiating with third parties he had first dealt with when he was employed at CCT
  • consequently, CCT was granted an interim injunction in March
  • as a result, CCT are seeking the return of intellectual property and confidential information to stop its ‘misuse and dissemination’
  • furthermore, CCT are seeking to prevent Dr Glynn and the companies from exploiting business opportunities which arose while he was director and representative

Employment Law – Decision

Justice Nicholson:

  • noted an intellectual property agreement appeared to be the ‘only express written agreement potentially relevant to the parties’ relationship’
  • noted there was ‘no written employment agreement, no deed of confidentiality or restraint of trade regulating the parties’ relationship or [Dr Glynn’s] post-employment obligations with respect to [CCT] is in evidence’
  • accepted direct supporting evidence Dr Glynn worked full-time as a chief scientist. In addition, he devoted thousands of hours to its project and possessed a significant amount of confidential information about its intellectual property
  • was satisfied there was support for potential findings that CCT was the owner of the intellectual property. Furthermore, such support indicates a large number of digital files were transferred following Dr Glynn’s resignation
  • said it was open to the court to discern from email correspondence that Dr Glynn and the companies had been negotiating with third parties
  • was satisfied that damages would not be an adequate remedy
  • concluded CCT is entitled to an interlocutory injunction. The injunction will restrain Dr Glynn and the two companies from using, exploiting, destroying or altering the ‘project intellectual property and confidential information’
  • the injunction also names entities and individuals whom they are restrained from any dealings relating to the device. Furthermore, it requires the recording of any transactions or dealings in relation to the device

Employment Law – Tips for Employers

Our Matthews Folbigg Workplace Solutions employment law team recommends employers:

  • review this employment law decision
  • seek the assistance of an employment lawyer to understand the impacts of this employment law decision
  • engage an employment lawyer to draft a written employment agreement with a suitable restraint of trade clause relevant to the position
  • engage an employment lawyer to draft a suitable deed of confidentiality
  • update employment contracts in response to this employment law decision
  • consult an employment lawyer if you suspect company confidential information or intellectual property has been misused

Employment Law – More Information

Please call the leading employment lawyers in Parramatta, the Matthews Folbigg Workplace Solutions employment law team on 9635-7966 to speak with one of our employment lawyers. [...]  READ MORE →

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Employment Law – Contractor Ordered to Return Files

Employment Law – Background

In Blue Badge Insurance Australia Pty Ltd v Farnarn [2017], an employer won a court order for a contractor to return confidential files

Employment Law – Facts

In essence:

  • A contractor was engaged by Blue Badge Insurance Australia between April 2013 and November 2014 to provide compliance advice. However, the end of this arrangement was not “amicable”
  • Blue Badge reminded the contactor of her confidentiality obligations. These included that she was return or destroy all documents, electronic storage media and other materials relating to confidential business information
  • Blue Badge took court action after failed multiple attempts to recover the documents

Employment Law – Decision

The NSW Supreme Court found:  

  • It was likely the contractor still had the confidential documents in her possession
  • The contractor was ordered to deliver hard-copy documents, computers and other electronic storage devices for inspection or file an affidavit identifying each document, the manner in which they were held, the date in which she ceased to possess them and an explanation of why she no longer had the documents
  • Her unreasonable conduct, in “deliberately refusing to engage with” the Court warranted a costs order against her

Employment Law – Tips for Employers

Our Matthews Folbigg Workplace Solutions employment law team recommends employers:

  • review this principal / contractor dispute decision
  • seek the assistance of an employment lawyer to understand the impacts of this decision
  • raise any employment law questions with an employment lawyer

Employment Law – More Information

Please call the leading employment lawyers in Parramatta, the Matthews Folbigg Workplace Solutions employment law team on 9635-7966 to speak with one of our employment lawyers. [...]  READ MORE →

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Employment Law – Drug and Alcohol Testing

Employment Law – Background

Drug and Alcohol Testing should be introduced with consultation in a company policy. The rationale is to prevent or rehab rather than discipline employees. However, employers need to consider the reasonableness of implementing a policy. In addition, employers also need to consider whether it breaches privacy law.

Employment Law – Issues to Consider

In essence:

  • Drug and alcohol testing should be introduced on work, health and safety grounds
  • this is because industrial tribunals have generally determined that testing is an intrusion of individual privacy. Therefore, it can only be justified on work, health and safety grounds
  • an employer has no control over what employees do in their own leisure time. Although conduct that may put an a person at risk or damage the company’s business and reputation can warrant control measures
  • because such a policy is to be considered a workplace health and safety matter, consultation with all staff is required
  • the policy is especially relevant in medium to high risk industries for instance manufacturing and construction
  • furthermore, some industries will require such a policy under the relevant workplace health and safety law
  • employers are obligated to attempt to eliminate the risk for employees impaired by drugs or alcohol. Conversely, employees may argue an intrusion into their personal lives
  • failure to educate employees about the terms of the drug and alcohol policy can result in disputes in the workplace
  • furthermore, the lack of a company drug and alcohol policy can also have negative implications for employers in unfair dismissal claims

Employment Law – Company Policy

A company policy on drug and alcohol testing should:

  • aim to educate employees about the expected standards
  • explain to employees their responsibilities
  • stipulate the consequences of a breach
  • refer to the types of substances which can cause impairment. Notably, alcohol, cannabis, methamphetamines including cocaine and ecstasy, and opiods such as heroin
  • also consider referring to legal and prescription drugs such as sleeping pills because they also cause impairment

Employment Law – Method of Testing

In essence:

  • the two most common methods of testing for illicit drugs are saliva and urine testing
  • oral testing is more focussed on acute impairment
  • urine testing is more likely to uncover drug use patterns
  • the Full Bench of the (then) Fair Work Australia concluded that oral testing should therefore be adopted for a drug and alcohol policy
  • urine testing is appropriate in certain circumstances

Employment Law – Tips for Employers

Our Matthews Folbigg Workplace Solutions employment law team recommends employers:

  • seek the assistance of an employment lawyer to prepare an appropriate drug and alcohol policy
  • communicate to employees the drug and alcohol policy to employees
  • consult with all employees the implementation of the drug and alcohol policy
  • provide ongoing training and education to employees
  • speak to an employment lawyer to determine the appropriate method of testing for the workplace
  • consult an employment lawyer to consider the relevant privacy legislation. Consideration should be in conjunction with the company’s privacy policy
  • prepare new employment law policies as required
  • eliminate the risk of employees coming to work impaired by drugs or alcohol
  • draft changes to current drug and alcohol policy with the assistance of an employment lawyer
  • finally, engage an employment lawyer to consider relevant workplace health and safety law for certain industries

Employment Law – More Information

Please call the leading employment lawyers in Parramatta, the Matthews Folbigg Workplace Solutions employment law team on 9635-7966 to speak with one of our employment lawyers. [...]  READ MORE →

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Employment Law – Recommendations for Employment Entitlements

Employment Law – Background

This article provides a consideration of the pros and cons of including employment entitlements in the following forms:

  • HR policy
  • Enterprise agreement
  • terms in a separate employment contract

Employment Law – Enterprise Agreements

Employers should actively encourage diversity and inclusion by using ‘inclusive’ language in the Enterprise Agreement. It should include:

  • Paid parental leave for both primary and secondary carers (this language includes same-sex couples)
  • A flexibility term
  • A consulation term
  • A disputes, grievance handling provision
  • Rates of pay
  • Provisions that enhance productivity improvement and flexibility.

Employment Law – HR policy versus Enterprise Agreement

Pros of using a HR policy include:

  • the benefit of non-binding application compared to a binding provision for the life of the Enterprise Agreement
  • less legal exposure in policy statements as breaches of enterprise agreements can incur fines or legal action
  • HR policies can be amended from time to time
  • a policy statement adds details and implementation procedures to the core entitlements contained in the Enterprise Agreement

Employment Law – Contract Provisions

Pros of putting provisions in individual contracts include:

  • flexibility to accommodate personal circumstances compared to a collective enterprise agreement
  • opportunity to trial new arrangements such as flexible working arrangements

Cons include:

  • provisions are difficult to remove later on
  • offering different conditions to different employees may increase the likelihood of discrimination complaints

Tips for Employers

Our Matthews Folbigg Workplace Solutions employment law team recommends employers:

  • engage an employment lawyer to ensure consistency with all employment documents containing employment entitlements
  • aim to include every employee demographic group to avoid criticism
  • use specific advertisements for employment to target specific demographic groups
  • ensure management are aware of the implications of a policy
  • educate staff particularly managers who are responsible for eligibility and implementation
  • train managers on handling ‘sensitive’ conversations with ‘minority’ employees
  • provide supporting resources such as toolkits and access to external experts
  • consult an employment lawyer about whether to adopt a policy, enterprise agreement or the insertion of provisions in a separate contract
  • speak to an employment lawyers about the cost-benefit analysis of each approach
  • prepare new employment law policies as required
  • draft new/changes to employment contracts with the assistance of an employment lawyer
  • draft new/changes to employment law policies with the assistance of an employment lawyer

Employment Law – More Information

Please call the leading employment lawyers in Parramatta, the Matthews Folbigg Workplace Solutions employment law team on 9635-7966 to speak with one of our employment lawyers. [...]  READ MORE →

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Employment – Personal Liability for Directors and Managers

Cause for Vigilance!

A string of recent employment cases involving the Fair Work Ombudsman have clearly illustrated the risk posed by the ‘accessorial liability’ provisions within the Fair Work Act.

In essence:

  • accessorial liability is a legal doctrine used to extend legal responsibility for an unlawful act to those involved in or associated with the act
  • in employment claims, accessorial liability can also render a director and/or manager liable for an employer’s contravention of the Fair Work Act

Accessorial Liability under the Fair Work Act

Under the Fair Work Act a person who is ‘involved’ in a contravention of the Fair Work Act is taken to have contravened that provision, where the person:

  • has aided, abetted, counselled or procured the contravention; or
  • has induced the contravention, whether by threats or promises or otherwise; or
  • has been in any way, by act or omission, directly or indirectly, knowingly concerned in or party to the contravention; or
  • has conspired with others to effect the contravention.

Founding Employment Decision

The foundation for such claims brought under the Fair Work Act was the decision of Guirguis v Ten Twelve Pty Ltd & Anor where the court held that in order for a person to be liable under the accessorial liability provisions of the Fair Work Act the person must: [...]  READ MORE →

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Employment Law – Unfair Dismissal – ‘Crude’ Facebook Post

Employment Law – Background

The Fair Work Commission’s decision in Colby Somogyi v LED Technologies Pty Ltd, where the FWC awarded an employee compensation after his dismissal for crude Facebook posts, provides a warning to employers of the care that needs to be taken in addressing issues arising from employee use of social media.

Facts
• A company dismissed a sales representative after posting crude comments on Facebook suggesting that a woman gave sexual favours to her boss for a promotion
• The company argued that as the employee posted the comments during work hours and directed the comments at the business, one of its employees or customers, it was “clearly inappropriate”
• The company believed that the employee’s opinions did not align with its objectives of promoting a safe workplace free of harassment, victimisation or sexual abuse
• They claimed that the employee had breached its social media policy, which prohibits inappropriate social media use at work
• However, the employee argued that the dismissal was unfair because he was not given an adequate chance to respond. He was not informed that the Facebook post was the catalyst for his dismissal, as the company did not respond to his queries as to why he was dismissed
• The employee claimed that his posts were not directed at the company, and were actually in reference to his mother being bullied at her workplace
• The employee claimed he posted the comments during his break and that he was unaware of the company’s social media policy [...]  READ MORE →