Employee claims company wanted him to train up his successor
The Federal Circuit and Family Court of Australia (FCFCOA) has ordered an employer to pay $20,000 after the latter was slapped with an age discrimination lawsuit.
The employee was a former chief accountant of a shipping company. In 2018, the employer informed the worker, who has been with them for more than 25 years, that his “permanent employment would be converted to a fixed-term contract”. During the said revised term, the employer preferred the employee train someone new to take over his position.
Before implementing the new contract, the employer’s board discussed the employee’s retirement. But, according to records, the board “misunderstood” that the employee “must retire at 65 years old.” When the employee found out, “he rightly corrected them and said he intended to retire the following year and would give three months’ notice.”
After the said discussion with the board, the employee wrote a letter that summarised their conversations, noting the employer’s plan for him to train his successor before terminating his employment. The managing director replied and told him that “the matter would be referred to the board.”
The employee made it known that he was “dissatisfied with the situation.” He then took personal leave and consulted a psychiatrist. Afterward, he consequently resigned.
The employee’s lawyers then wrote to the employer, alleging constructive dismissal. The employee filed a complaint of unlawful age discrimination in the Australian Human Rights Commission (AHRC), but the parties failed to settle the matter. He subsequently lodged a claim in the FCFCOA.
The employee’s allegations
The employee said “he intended to work until the age of 70 and was keen to work as long as possible.” He also said the employer “never raised any performance issues before the change in contract and had rewarded the employee with annual bonuses since 2004.”
The court’s decision
The FCFCOA acknowledged the employer was able to “take proactive steps and implement succession plans,” but it said that it still “treated the employee disrespectfully and less favourably than his intended replacement, which amounted to discrimination.”
It also ruled that the employee was “entitled to an apology” and awarded him $20,000 for damages.
Takeaways for HR leaders
According to the Victorian Chamber of Commerce and Industry (VCCI), the case emphasises the “importance of understanding the [employer’s] responsibilities around equal opportunity and what constitutes discriminatory practices.”
VCCI also reminded HR that an employee could make an application to claim for General Protections within 21 years after the day on which the contravention occurred.
