Federal Government backs union in High Court adverse action appeal

by 18 Nov 2011

The announcement that the Federal Government is intervening in the High Court appeal lodged by Bendigo TAFE against the Full Court of the Federal Court decision in Barclay v The Board of Bendigo Regional Institute of Technical and Further Education [2011] FCAFC is set to raise the ire of employer associations and industry.

Given the nature of the Federal Court decision and its implications in this matter, one would expect to see the government intervening to support the employer. Instead, Senator Chris Evans has intervened to support the Australian Education Union, which is representing Mr Barclay. Senator Evans has suggested it is because such intervention is “in the public interest”. Which “public” one wonders?

The decision arises from the controversial “adverse action” provisions which were introduced in the Fair Work Act 2009. While the legal concepts are not necessarily new, these provisions opened up an avenue of redress for employees and unions which has been gleefully exploited by both ever since.

Put simply, a claim can be made where a person suffers “adverse action” for reasons that include the presence of, or exercise of a “workplace right”. The adverse action can include termination of employment, transfer, demotion or disciplinary action. The workplace right can be a right under a workplace law (including an enterprise agreement), the right to be a union member or representative or the right to make a “complaint or inquiry” about one’s employment.

In such circumstances, a claim can be made which, while often subject to conciliation before Fair Work Australia, is agitated before the Federal Court or Federal Magistrates Court. The Court can grant compensation (which is not limited by statute), impose penalties and make a broad range of discretionary orders including injunctive relief.

In the Barclay case, Mr Barclay was a union representative. He circulated an email to fellow employees which made damaging allegations of unethical conduct against his employer. The email was sent in his capacity as a union representative. He had not raised these issues with management prior to circulating the email. He was legally and contractually obliged to raise allegations of unethical conduct with his employer and yet had not done so. The TAFE wrote to Mr Barclay, clearly outlining how his conduct was in breach of his obligations and the possible consequences for his employment and asking him to present the evidence for his allegations. Mr Barclay was formally stood down and required to respond. The AEU, on Mr Barclay’s behalf, commenced adverse action proceedings alleging that the TAFE had acted this way for reasons that included Mr Barclay’s position as a union representative.

He later returned to work, with the disciplinary proceedings suspended until the outcome of the legal action in question. At first instance, the Federal Court found in favour of the TAFE, accepting that the action was taken as a result of Mr Barclay’s breach of his obligations toward his employer and not his status as union representative. This was later overturned on appeal by the Full Court.

The Full Court decision created enormous disquiet amongst employers as it seemed to signal that there could be few, if not no, circumstances where employers could legitimately take disciplinary action against employees, undertaking business they consider to be ‘union business”, who also happen to be union representatives.

The Full Court’s reasoning was controversial for a number of reasons. Firstly, rather than looking at the decision maker’s “subjective” intention when taking the alleged action, the Full Court said that the examination needed to focus on the “real reason” the action was taken. “The real reason for a person’s conduct is not necessarily the reason the person asserts, even where the person genuinely believes he or she was motivated by that reason. The search is for what actuated the conduct of the person, not for what the person thinks he or she was actuated by. In that regard, the real reason may be conscious or unconscious or not appreciated or understood, adverse action will not be excused simply because its perpetrator held a benevolent intent. It is not open to the decision maker to choose to ignore the objective connection between the decision he or she is making and the attribute or activity in question”.

Or, in another way or putting it, “you may not think it was the reason you did what you did, but without even knowing or understanding it, you did it because of the reason alleged”. In light of this, is it ever possible to discipline an employee, who also happens to be a union delegate, who acts outrageously or in gross breach of their duties as an employee, when they have their union hat on? The Court said “it is impossible for that employer to dissociate or divorce from that conduct its reason for the taking of the adverse action simply by characterising the activity of the union as the activity of its employee”. Many employers would agree that it is often hard to differentiate when a very active union representative is ever acting simply as an employee rather than exercising some industrial right. In fact, I can think of many union representatives who spend their employment entirely acting in some union capacity or another.

The Full Court reasoned that as Mr Barclay was acting in his capacity as a union representative, the beef was with the union, not with him as an employee and the appropriate action was for TAFE to take up the issue with the union. Does this in effect bar employers from ever acting to discipline union representatives? More worryingly, does this mean that the rights and protections rightly afforded to union representatives under the law override those fundamental obligations inherent in the employment relationship?

While most would agree that this outcome is sensible and logical if the conduct is clearly industrial activity such as participation in union meetings, rallies, disputes and negotiations. But what about when a union representative is consistently absent from work (without permission) as a result of attending to “union business”? Or when a union representative performs poorly in their role and argues that it is because of the work load imposed by the union responsibilities? More complexity will soon be added with the introduction of the harmonised workplace health and safety laws and the introduction (in many states for the first time) of health and safety representatives, most of whom are very likely to also be union representatives.

In this environment, the Barclay case is very important to employers and the ongoing management of workplaces, particularly in heavily unionised industries. Given the difficulties the Full Court decision created for employers, it not unreasonable to think that the Government may gave considered intervening to support the TAFE. Regardless of what the High Court may decide, many employers will see the government’s formal support of the union as a case of backing the wrong horse.

About the author

Alice DeBoos is a partner at Middletons