General Protections Provisions Under the Fair Work Act: What Employers Need to Know and How to Avoid Breaches

The Fair Work Act 2009 (Cth) (“Act”) plays a critical role in ensuring that Australian employees are protected from unfair treatment in the workplace. Among the key features of the Act are the general protections provisions, which prevent employers from taking adverse actions against individuals for prohibited reasons, such as exercising their workplace rights, engaging in industrial activities, or being discriminated against based on specific attributes.

Recent Court decisions underscore the importance of understanding these provisions and the consequences of failing to comply. In this client alert, we explore the key concepts behind general protections, highlight recent legal cases, and provide practical tips for employers to prevent breaching these provisions.

Understanding General Protections in the Fair Work Act

The general protections provisions in Part 3-1 of the Act are designed to shield employees, contractors, and prospective employees from unfair treatment or “adverse action” in relation to their employment. These provisions prevent employers from taking adverse action against individuals due to:

• Exercising a workplace right
• Engaging or intending to engage in industrial activities
• Experiencing discrimination based on a protected attribute
• Being absent from work due to temporary illness or injury
• Refusing unlawful requests or demands

Key Concepts in General Protections

To understand how general protections work, it’s important to break down some of the key terms used in the legislation:

a. Workplace Rights

Workplace rights refer to a broad range of entitlements or responsibilities under Australian workplace laws, industrial instruments (such as awards or enterprise agreements), and employment contracts. This can include rights to lodge complaints, seek entitlements, and participate in lawful workplace activities.

b. Adverse Action

Adverse action occurs when an employer takes any form of negative action against an individual, such as:

• Dismissing an employee;
• Injuring the employee in their employment (e.g., reducing pay or hours);
• Altering the employee’s position to their detriment;
• Discriminating against them; or
• Refusing to hire a prospective employee due to their workplace rights or personal attributes.

c. Discrimination

The Fair Work Act prohibits adverse action on discriminatory grounds. These grounds include, but are not limited to:

• Race;
• Sex;
• Age;
• Physical or mental disability;
• Marital status;
• Pregnancy;
• Religion; or
• Political opinion.

d. Industrial Activities

Industrial activities include participation in or refusal to participate in lawful activities conducted by industrial associations (such as trade unions). General protections ensure that individuals cannot be treated unfairly for engaging in lawful union activities, including attending meetings, representing members, or making representations to the employer.

Protections Against Adverse Action

The Fair Work Act clearly stipulates that employers must not take adverse action against employees because they have exercised their workplace rights. For example:

• An employee cannot be dismissed or demoted for lodging a complaint about workplace safety or in relation to their employment.
• An employer cannot discriminate against an employee for requesting flexible working arrangements to accommodate a family commitment.
• A worker cannot be denied opportunities or penalized for being a member or official of a trade union.

Employers must also be careful not to disadvantage employees for having temporary illnesses or injuries, provided their absence is reasonable under the circumstances.

Burden of Proof

A unique and significant aspect of the general protections provisions is the reverse onus of proof. If an employee claims that adverse action was taken against them due to their exercise of a workplace right or because of a protected attribute, the employer must prove to the court on the balance of probabilities that this was not the reason for their decision. This legal mechanism ensures that employees have robust protection, making it more difficult for employers to escape scrutiny in cases of alleged unlawful adverse action.

Remedies for Breaches

If an individual believes that their general protections have been breached, they can make a claim to the Fair Work Commission (FWC). The FWC can attempt to resolve disputes through mediation, conciliation, or arbitration (with the consent of each party). If the matter is not resolved, the aggrieved party may elect to pursue the matter in the Federal Court of Australia or the Federal Circuit and Family Court of Australia.

Remedies for breaching general protections may include:

• Compensation for loss of wages or damages;
• Reinstatement of employment;
• The Court imposing pecuniary penalties against the employer and/or any individual knowingly concerned in the contravention of the Act; and
• Any other order that the Court sees fit to impose.

Additionally, there are civil penalties for employers who breach the general protections provisions. These penalties can be substantial, emphasizing the importance of compliance with the Fair Work Act.

Recent Cases Involving Breaches of General Protections

Several recent high-profile cases illustrate the risks employers face if they breach the general protections provisions:

1. Qantas Airways Limited v Transport Workers Union (2023): One of the most significant general protections cases in recent years involved Qantas’ decision to outsource its ground handling operations in 2020, which affected nearly 1,700 employees. The High Court found that Qantas had breached the general protections provisions by taking adverse action to prevent employees from exercising their right to take industrial action. The Court confirmed that general protections extend to preventing future rights from being exercised, and employers must prove that adverse actions were taken for legitimate reasons.
2. Jackson v The Trustee for L & L Chua Family Trust (2023): This Fair Work Commission ruling involved a casual employee who filed a general protections claim after his shifts were cut to zero following complaints about workload. The Commission found that reducing a casual employee’s shifts to zero can be considered adverse action, making the employer liable under general protections. The case demonstrated the broad scope of these protections for casual employees.
3. Pezzimenti v Rotary International (2019): This case dealt with a manager dismissed following performance concerns. The Court found that proscribed reasons, including complaints raised by the employee, contributed to his dismissal. The ruling resulted in significant compensation for the employee, highlighting the importance of transparent and fair performance management.
4. Haley v Laing O’Rourke Australia Management Services Pty Ltd (2024): in this case, a senior manager that had raised complaints about being overwhelmed by his workload was dismissed after he and his colleagues held a karaoke night outside of hours, which resulted in a noise complaint. The Court found that despite the employer arguing the dismissal was a result of the noise complaint, the employer was unable to discharge the reverse onus of proof in relation to the reasons for dismissal, and awarded close to $3 million to the employee. This case emphasises the high threshold of the reverse onus of proof and the necessity to ensure that any dismissal is not influenced by unlawful motivations.
5. Alam v National Australia Bank Ltd (2021): this Full Federal Court decision clarified the meaning of when an employee exercises a workplace right by making a “complaint or inquiry in relation to his or her employment”. It was held that, in order to constitute the exercise of a workplace right, a complaint must be made in relation to a right or entitlement of the employee (which may arise under legislation, industrial instrument or contract) – for example, a complaint made by an employee that there are no snacks left in the kitchen would not constitute the exercise of a workplace right, as this complaint is not in relation to any right or entitlement enjoyed by the employee.

Top Tips for Employers to Avoid General Protections Claims

To avoid breaching the general protections provisions of the Act, employers must be proactive and adopt best practices. Here are some key tips:

1. Understand Workplace Rights and Obligations

Employers need to fully understand their employees’ workplace rights, including the right to make complaints, request entitlements, and engage in union activities. Employers need to also familiarise themselves with newly legislated workplace rights such as the right to disconnect and the right to discuss and disclose their remuneration. Failing to respect these rights can result in general protections claims.

2. Maintain Clear and Transparent Communication

Clear and documented communication is essential to prevent misunderstandings that could lead to disputes. This is especially important when managing performance or conduct issues, role changes, or dismissals. Ensure that all actions are properly justified and communicated to the employee.

3. Implement Robust Performance Management Systems

Poorly managed performance issues can often lead to general protections claims. Ensure that your performance management processes are objective, transparent, and well-documented. Avoid making decisions that could be seen as retaliation against employees for exercising their workplace rights.

4. Avoid Discriminatory Practices

Ensure that all employment decisions are based on objective, non-discriminatory factors. Actions perceived as discriminatory (based on race, age, gender, disability, etc.) can lead to breaches of the Act.

5. Carefully Handle Redundancies and Restructuring

When conducting redundancies or restructuring, ensure the decisions are based on legitimate operational needs. Any perception that actions are timed to avoid protected industrial action or other workplace rights could be seen as a breach.

6. Document Decision-Making Processes

It is essential to keep thorough documentation of the reasons behind employment decisions. Keep records of meetings, performance reviews, and communications to demonstrate that decisions were made for legitimate business reasons.

7. Know and Comply with Anti-Bullying and Harassment Laws

Employers must have clear policies and procedures in place to handle bullying and harassment complaints. Failure to address these issues properly can lead to claims, including but not limited to under the general protections provisions.

8. Conduct Regular Compliance Audits

Regular audits of workplace practices help ensure compliance with the Act. Employers should regularly review employment contracts, policies, and decision-making processes to identify potential risks.

9. Offer Training on General Protections

Regular training for managers and HR staff on general protections and other employment laws is critical. Keeping the team updated on legal obligations helps prevent inadvertent breaches.

10. Seek Legal Advice Before Major Employment Decisions

Before making significant employment decisions, such as terminations or redundancies, employers should seek legal advice to ensure that their actions comply with the Fair Work Act.

Conclusion

Employers must take a proactive approach to prevent breaches of the general protections provisions under the Act. Understanding workplace rights, maintaining clear communication, and having transparent processes in place for managing employees are key to avoiding costly legal disputes. By following these best practices, employers can protect themselves from general protections claims while fostering a fair and compliant workplace.

News Alert – WHS Manslaughter Laws Now law

The NSW Work Health and Safety Amendment (Industrial Manslaughter) Act 2024 (Amending Act), took effect on Monday, 16 September 2024.

A company that engages in conduct which is considered gross negligence and constitutes a failure to comply with its duties to ensure the health and safety of workers pursuant to the Work Health and Safety Act 2011 (NSW), and such conduct result in the death of the worker, can now be fined up to $20 million.

An officer of the Company or “person conducting a business or undertaking”, can be jailed for up to 25 years under the Amending Act.

As a result of the Amending Act, NSW has the harshest penalties for industrial manslaughter in Australia.

If you wish to discuss any aspect of this client alert or require specialist advice in relation to an employment law matter, please do not hesitate to contact us.

This alert is not intended to constitute, and should not be treated as, legal advice.