Who is really pulling the strings? Identifying decision makers is key in defending adverse action claims

Recent Federal Court decisions highlight the importance of identifying decision makers in defending adverse action claims, particularly when employers face allegations under the Fair Work Act 2009 (Cth).

For early childhood education and care (ECEC) providers, these cases serve as a timely reminder of the importance of procedural fairness in managing workplace disputes. Employers failing to identify decision makers involved in an adverse action claim could be a deal breaker in defending a general protections claim.

Under Part 3-1 of the Act, the general protections scheme provides wide-ranging protections against adverse or unfair treatment because of prohibited reasons. This could be a person exercising or proposing to exercise a workplace right, including making a complaint or enquiry in relation to the employee’s employment, discrimination or a temporary absence from work due to illness or injury.

The reverse onus in a general protections claim

Where an employee alleges that their employer has taken adverse action against them, section 361 of the FW Act operates so that it is presumed that the adverse action was taken because of the prohibited reason(s) unless the employer proves otherwise.

Under the provision, the employer has the onus of proving that the pleaded prohibited reason or intention for taking the action was not a substantial or operative part of its reasons for engaging in the conduct or action. In practical terms, the employer is required to establish the identity of the decision maker, or decision makers, involved in the conduct or action and the reasons why the decision maker, or decision makers, engaged in the conduct or action.

Discharging the reverse onus in a general protection claim can be challenging for education centres, especially when multiple ‘decision makers’ are involved in an employee’s dismissal.

The court is not confined to the considerations of the ultimate decision maker on paper. That is, if the decision maker has relied on information, a recommendation or assessment from other people to take adverse action, the reasons given by those individuals must also be identified and defended to show they were not motivated by a prohibited reason.

Failure to identify and call all relevant ‘decision makers’ can be fatal to discharging the reverse onus.

Lessons from the law

The Pilbrow v University of Melbourne [2024] FCA 1140 case highlights the risks involved when failing to identify decision makers. 

The applicant in this case, the employee, asserted that she made various complaints to the respondent, her employer, who then took adverse action against her by accusing her of serious misconduct, making her position redundant and dismissing her on the grounds of redundancy.

Both parties agreed that the employee exercised various workplace rights and that the employer engaged in four adverse actions, specifically the decision to make the employee’s position redundant, the dismissal, alleging that the employee engaged in serious misconduct and issuing the employee with a final written warning.

The issue was whether any of the above adverse actions were taken because of one or more workplace rights exercised by the applicant. At first instance, the primary judge dismissed the applicant’s general protections application, except for the claim relating to the final written warning issued to her.

On appeal, Justice Snaden dismissed several grounds of the appeal. However, in respect to the appeal ground relating to the adverse action of alleging serious misconduct against the applicant, his Honour observed that neither party had clearly identified which employees or agents of the respondent were involved in putting the allegation of serious misconduct to the applicant in the way that it did.  

Justice Snaden opined this to be a matter of some significance and since the respondent admitted to the adverse action, its successful defence relied on proving two things:

1. the identity of the person or people through whom it relevantly acted the innocent state or;
2. states of mind that relevantly actuated that person or those people, with this requiring proof of the former.

The judge found it difficult to believe the company’s human resources team, who seemed to be handling the accusation, couldn’t identify the specific person who made the claim. 

As a consequence, Justice Snaden held that the primary judge was wrong to find that the respondent had discharged the reverse onus with respect to the serious misconduct allegation in circumstances where the particular decision maker or decision makers were not identified.

When defending a general protections claim, it is crucial to consider who should provide evidence – including staff involved in the decision-making process who may have influenced the ultimate decision. Failure to do so may result in a court finding that the reverse onus has not been discharged.