Significant and systematic micromanaging valid reason for dismissal

The Fair Work Commission has upheld an employer’s decision to dismiss an employee who engaged in “significant and systematic micromanaging” of his employees.  The employer dismissed the employee following a workplace investigation, on the basis that he had engaged in breaches of relevant workplace policies regarding bullying and harassment.

Complaints

Several employees working under the supervision of the employee made complaints. A number of complaints related to specific incidents, including that the employee had responded to an employee’s group email publicly with “why did you send this?” and had then spoken to the relevant employee about the email in an aggressive and threatening tone. Other aspects of the employee’s micromanaging included that he had limited employees’ contact with internal and external stakeholders by requiring permission to speak to stakeholders, started attending internal stakeholder meetings with employees (who had previously attended meetings alone), and required employees to complete onerous tracking and other administrative tasks.

Micromanagement had the effect of bullying

The employee did not dispute the contents of the complaints, but rather their characterisation as bullying behaviour.  The employee claimed that the relevant employees had not raised these issues with him directly prior to making a formal complaint and that he had been unaware that his behaviour had an adverse effect. 

The Commission found that despite the possibility of the employee being “well-intentioned”, the cumulative effect of his conduct and behaviour was one of significant and systematic micromanaging that breached the employer’s Code of Conduct, and bullying and work, health and safety policies. 

The decision indicates that an employee’s intention may not be relevant in considering whether conduct is bullying.  Rather, the Commission will consider the impact of the behaviour in question on affected employees. 

see Carroll v Karingal Inc [2016] FWC 3709

Sobering effects of terminating for breach of alcohol policies

The Fair Work Commission has upheld an employee’s application for unfair dismissal following a positive blood alcohol test at work. 

The employee, a maintenance worker, underwent a pre-work blood alcohol test.  His blood alcohol content first showed at 0.013%, and 0.006% some 30 minutes later.  The employee was stood down for the day, and his employment was terminated summarily 4 days later for breach of the company’s zero-tolerance Drug and Alcohol Policy.

Whilst the employee argued that his blood alcohol readings were low and still within legal limits to drive a B-double truck, Commissioner Bissett considered this as a rather dismissive attitude towards workplace health and safety on the part of the employee. The Commissioner also acknowledged that the incident was a clear breach of the Company’s zero-tolerance policy which required employees to present to work with 0.000% blood alcohol.

However, the employer relied upon other grounds to terminate, namely an earlier first and final warning for a safety breach, which the Commissioner found to have been inappropriate.  Also in issue was the fact that the employee did not appear to have been given an opportunity to respond to all of the matters being considered in respect of the decision to terminate, including the prior warning. Accordingly, where the first and final warning was found to have been harsh in the circumstances, and given the nature of the readings in question, the Commissioner found the dismissal to have been unfair.

The employee was not reinstated but was awarded compensation of $11,507.16.

The FWC has been increasingly willing to confirm the appropriateness of dismissals for breach of zero-tolerance work health and safety policies (see an earlier post on this topic at: Summary for breach of employer drug policy not unfair).

However, this decision suggests that, despite the existence of zero-tolerance drug and alcohol policies,  employers should still consider the appropriateness of dismissal for a “first offence”, particularly for otherwise lawful, low level breach.

Ingham v Metro Quarry Group Pty Ltd [2015] FWC 6472 (29 September 2015)

Genuine redundancy weighed against reasonable redeployment opportunities with labour hire contracts

The ‘genuine redundancy’ provisions of s 389(2) of the Fair Work Act 2009 allow an employer to avoid a claim of unfair dismissal following a job elimination, where it would have been unreasonable in all the circumstances to redeploy the employee. Redeployment opportunities may be within the employer’s business or the business of an associated entity. Increasingly, the Fair Work Commission (FWC) has also been asked to consider the extent to which an employer should consider displacing labour hire personnel in order to “redeploy” redundant employees. 

No reasonable redeployment where flexible labour hire workforce a genuine business need

Last week the FWC considered the availability of redeployment opportunities for six retrenched coal mine workers at Clermont Open Cut mine in Queensland. The workers argued that that labour hire employees could have been displaced to accommodate redeployment of the retrenched workers. However, VP Catanzariti accepted the employer’s argument that the use of labour hire permitted necessary flexibility – particularly in relation to covering employee absences on leave and peak requirement: See: Brown and Ors v Clermont Coal Operations Pty Ltd T/A Clermont Open Cut [2015] FWC 3862.

The FWC considered a similar application earlier this year, in which it was ultimately found that retraining costs associated with redeployment through labour hire displacement would have rendered any such redeployment unreasonable, see:  Pettet and Ors v Mr Arthur Coal Pty Ltd [2015] FWC 2851. In that instance, VP Hatcher found that redeployment to roles being performed by labour hire workers was possible with retraining. However, VP Hatcher considered detailed costing evidence proposed by the employer to find that the cost of retraining would have surpassed the cost of redundancy, making the possibility of redeployment to displaced labour contract roles unreasonable.

Available “job or position or other work”

A full bench of the FWC has previously considered the operation of s.389(2) in the context of whether employers should have displaced labour hire employees in order to redeploy redundant employees: see: Ulan Coal Mines Limited v Honeysett & Ors [2010] FWAFB 7578 and Technical and Further Education Commission t/a TAFE NSW v Pykett [2014] FWCFB 714.  In these cases it was accepted that the FWC must find, on the balance of probabilities, that there was a job or a position or other work (our emphasis) within the employer’s enterprise (or that of an associated entity) to which it would have been reasonable in all the circumstances to redeploy the dismissed employee.

The FWC has affirmed  that it is appropriate to review labour hire arrangements (and work patterns, for example overtime reliance) when considering redeployment opportunities. As it stands, the onus is on the employer to demonstrate that redeployment was not reasonable in a particular redundancy scenario. The reasonableness of redeployment is to be assessed “in all the circumstances“, meaning that it is not possible to establish binding rules concerning the application of s.389(2) in all cases irrespective of the circumstances of each particular case.

Factors to be considered when assessing labour hire workers and redeployment

Generally, employers have been able to argue against the suggestion that redeployment by labour hire displacement was feasible. This is where the employers in question have been able to demonstrate that the work undertaken by contract labour was best suited to such continuing arrangements because of factors such as available skills and expertise, flexibility, and cost.  In other words, employers have been able to successfully show that work being undertaken by contractors should stay being undertaken by contractors for flexibility in a legitimate business strategy, underlying financial reasons, or due to the particular skillset of contractors being used. 

Employers seeking to implement redundancies should review labour hire arrangements in the context of ongoing need and redeployment opportunities before proceeding to retrenchment. Where labour hire employees are not to be displaced, employers should be confident of demonstrating a continuing need for labour hire arrangements due to workforce organisation factors such as specialised skill requirements, flexibility and cost.

Time for Time: FWC proposes time in lieu to replace overtime pay

As part of its four-yearly review of modern awards and award flexibility, the Full Bench of the Fair Work Commission has proposed a new time off in lieu (TOIL) model clause for modern awards without existing TOIL provisions.

Winners and lieu-sers

The Australian Industry Group (AiG) successfully captured the FWC’s attention in respect of its claim to insert TOIL provisions into modern awards that do not currently have TOIL provisions. The FWC indicated a provisional view that it is necessary to incorporate a model TOIL clause. However,  the FWC rejected AiG’s claim to replace existing TOIL provisions in certain modern awards with a new model TOIL clause.  The FWC also rejected AiG’s claim to insert a ‘make-up time’ provision into 51 of the 122 modern awards, finding that this was not necessary  because make-up time agreements can be entered into pursuant to existing flexibility arrangement provisions.

The FWC’s proposed TOIL model clause will facilitate agreements between an employee and their employer to take TOIL instead of payment for overtime at a time or times agreed, subject to appropriate safeguards.
The proposed change is beneficial to employees and employers, because employees are assisted with balancing their work and non-work commitments, and employers save by calculating the TOIL on an hour for hour basis rather than at the relevant overtime penalty rate (with the exception of modern awards which currently provide for TOIL at the overtime penalty rate).

Next Steps

At present, the FWC has only expressed a provisional view while it receives submissions from interested parties. If this proposed clause is adopted, it will be included in modern awards which provide for overtime payments but do not currently contain TOIL provisions. Employers will be required to:

  1. Reach written agreement with employees for each occasion on which overtime is to be taken as TOIL, within four weeks of the overtime being worked;
  2. Pay the employee for any accrued TOIL that the employee has not used at the applicable overtime rate, at the request of the employee;
  3. Retain records of (a) and (b) as employee records;
  4. Pay the employee for the overtime at the applicable overtime rate, at their request or if they do not take TOIL within 12 weeks of the overtime being worked; and
  5. Pay the employee for any accrued entitlement for TOIL  that has not been taken, at the applicable overtime rate, upon termination of employment.

The proposal will apply to 113 modern awards including the Banking, Finance and Insurance Award 2010, Cleaning Services Award 2010, Real Estate Industry Award 2010, Restaurant Industry Award 2010 and the Hospitality Industry (General) Award 2010. The Building and Construction General On-Site Award 2010, the Joinery and Building Trades Award 2010 and the Seagoing Industry Award 2010 are specifically excluded from the new model.

Interested parties can make further submissions directed at the TOIL clause model to the Fair Work Commission by Friday 28 August 2015 with a further hearing scheduled for Friday 4 September 2015.

[2015] FWCFB 4466