Fair Work Commission

Commonwealth Bank of Australia v Reeve [2012] FCAFC 21 (8 March 2012), [(2012) 217 IR 335].

Facts

A Commonwealth Bank manager sought workers’ compensation after developing a depressive illness. The Administrative Appeals Tribunal found that a number of circumstances contributed to the worker’s depression, including staffing changes affecting his branch in June 2008, and a number of events on the day of 18 July 2008. These included a telephone conference with fellow managers and his area manager in which the worker had to report poor results to colleagues and felt humiliated, an unsupportive visit from his area manager, his receipt of poor customer service results for the branch, and the anxiety he felt about reporting these results to his colleagues at an upcoming teleconference. The Bank sought judicial review of the AAT’s decision. It submitted that it was not liable to pay the worker’s compensation because the actions that contributed to his depression, such as the staffing changes and use of teleconferences, were ‘administrative action’ and excluded the Bank from liability.

Outcome

A Full Court of the Federal Court did not accept the Bank’s submission. It held that the exclusion applied to specific action taken in respect of an individual’s employment, such as disciplinary action, as opposed to action forming part of the everyday tasks and duties of that employment. This meant that the ordinary work routine, changes to routine and directions to perform work were not ‘reasonable administrative action taken in respect of the employee’s employment’. The worker’s claim for compensation was successful.

Relevance

In this case the appeal failed because the definition of ‘administrative action’ in s.5A of the Safety, Rehabilitation and Compensation Act 1988 (Cth) required that the action be taken ‘in respect of the employee’s employment’. Under the Fair Work Act the definition of ‘reasonable management action carried out in a reasonable manner’ does not have such an exclusion.

Persons conducting a business or undertaking have rights and obligations to take appropriate management action and make appropriate management decisions to respond to poor performance, direct and control the way work is carried out or, if necessary, take disciplinary action.

National Australia Bank Limited v KRDV [2012] FCA 543 (28 May 2012), [(2012) 204 FCR 436].

Facts

A worker attended regular weekly meetings with other team leaders and her manager, which were used to assess workloads for planning purposes. She was criticised for poor work performance during one of these meetings. The worker claimed workers’ compensation, alleging injury after being ‘picked on and singled out’ by her manager, and subjected to personal criticism in front of other managers. The worker’s employer denied the claim, arguing her condition was a result of reasonable administrative action taken in a reasonable manner in respect of her employment.

Outcome

The Federal Court held that, because the meeting was not arranged for the purpose of discussing the workers’ performance, the behaviour did not fall within the ‘reasonable administrative action’ exclusion for a workers’ compensation claim.

Relevance

When determining if actions are ‘management action’, it is necessary to examine the original intention of the actions. An informal, spontaneous conversation between a manager and a worker may not be considered management action, even if management issues are raised.

Application by E.K. [2017] FWC 3907 (Simpson C, 21 August 2017).

Facts

The applicant alleged that the behaviour engaged in by her manager and supervisor was repeated, unreasonable behaviour and did not constitute reasonable management action conducted in a reasonable manner.

On a number of occasions the applicant’s supervisor had cause to address certain issues with the applicant. The applicant alleged that in each of these occurrences her supervisor commenced a discussion by raising their voice at the applicant.

Outcome

The Commissioner, in considering the case advanced by the applicant and the version of events from the perspective of the persons named, found that, whilst the applicant held a strong perception that she was the subject of bullying, it was not borne out by the evidence.

In dismissing the application the Commissioner considered that there was a pattern of the applicant making specific allegations about having been bullied when the evidence suggested that it was in fact her own behaviour that was inappropriate.

Relevance

When determining if the conduct of person(s) named is reasonable management action taken in a reasonable manner, it is necessary to examine the facts and circumstances of the matter. In this case the evidence demonstrated that the conduct of both the manager and supervisor of the applicant was at all times reasonable management action carried out in a reasonable manner.

Devasahayam and Comcare [2010] AATA 785 (14 October 2010).

Facts

A public servant claimed she suffered psychological injuries during the course of her work, due in part to a number of issues relating to her performance appraisals, failure to be promoted and being ‘humiliated’ in front of others. Her compensation claim was refused on the basis her condition was a result of ‘reasonable administrative action undertaken in a reasonable manner’.

Outcome

The Administrative Appeals Tribunal upheld this decision, finding that all applicable guidelines had been followed.

Relevance

What is reasonable is assessed objectively and relates to the specific conduct involved in light of the process overall. Reasonableness must be assessed against what is known at the time without the benefit of hindsight, taking into account the attributes and circumstances, including the emotional state, of the employee concerned.

Re Mr Sun [2014] FWC 3839 (Cloghan C, 16 June 2014).

Facts

The applicant was employed as an Application Developer. Later Mr A was appointed as General Manager, Information Systems. As a part of the performance appraisal process the applicant had to self-rate his performance. His direct manager queried some of the ratings; however the applicant received a rating of ‘Meets Requirements’ for each objective in the completed performance appraisal. On the day the applicant received notification of his annual discretionary bonus (which was less than he expected) he accessed Mr A’s electronic diary and saw an email between Mr A and his direct manager regarding his performance.

The applicant collapsed at work and was taken to hospital. At a meeting to discuss his return to work he alleged the collapse was work related and that an unnamed person changed the weightings on his performance appraisal (the First Complaint). The employer advised him that it would formally investigate the complaint in accordance with policy. The investigation found that his allegation was not substantiated.

Upon his return to work the applicant had a meeting with his manager and Mr A to discuss his role and how he carried it out. Mr A informed the applicant that he could allocate employees to undertake tasks irrespective of whether they were within the employee’s skills or position description, and that he was authorised to make such decisions and monitor those tasks and his expectations. This resulted in a situation where the applicant was critical of Mr A for requiring him to do a task which he considered was beyond his skills and capabilities, and consequently he accused Mr A of bullying (the Second Complaint).

Outcome

The Commission was satisfied that the applicant reasonably believed he was being bullied at work. However, with respect to the First Complaint, the alleged management action simply did not occur. Meanwhile, the Second Complaint involved management action by Mr A, which, when applying an objective test, was not bullying or unreasonable; it was reasonable and carried out in a reasonable manner.

Relevance

The Commission stated that caution should be exercised when considering whether payment of a discretionary bonus could be considered workplace bullying. The applicant’s belief that he should have been paid more did not constitute workplace bullying unless payment of the discretionary bonus was applied in a punitive manner. Of concern was that the applicant accessed Mr A’s email without permission; an employee does not have immunity from observing policies and practices expected in the workplace and employment relationship because they feel they are being bullied.

Amie Mac v Bank of Queensland Limited and Others [2015] FWC 774 (Hatcher VP, 13 February 2015).

Facts

Amie Mac filed an application for orders to stop bullying at work. The application alleged that bullying occurred in the course of Ms Mac’s employment as a lawyer with the Bank of Queensland Limited (BOQ), and identified five persons employed by BOQ as the perpetrators of that bullying (jointly the respondents).

All staff undergo yearly Performance Development Assessments (PDAs). In her 2013 half-yearly PDA Ms Mac’s supervisor raised a number of areas where she needed to improve, and made a number of suggestions concerning how she might improve, her work performance. Shortly after Ms Mac went through the full-year PDA process she was put on a performance improvement plan (PIP). By about mid-February management had formed the view that Ms Mac was not meeting the objectives of the PIP and had therefore ‘breached’ it. In March 2014, Ms Mac’s solicitors sent a letter to BOQ advising that Ms Mac was on sick leave due to ‘acute stress’ caused by the PIP process and its surrounding circumstances.

Outcome

The Commission found that the decision to place Ms Mac on a PIP, and the manner in which the PIP process was implemented, were not unreasonable. Prior to the decision to place Ms Mac on a PIP being made, shortcomings in her performance had been identified by Ms Mac’s managers over a considerable period of time. Those shortcomings were brought to Ms Mac’s attention primarily through the documented PDA process, which was the established mechanism by which employees received feedback about their performance and were placed on notice if improvements were required. Although Ms Mac was rated as ‘Competent’ in her 2012 full-year PDA, significant shortcomings in her performance were identified. By the time of the 2013 full-year PDA, most of those shortcomings remained. The outcome of the 2013 PDA was an assessment of ‘Needs development’. In that context, BOQ was clearly entitled to take some form of action to achieve an improvement in Ms Mac’s performance.

The PIP process was the standard means by which this was done within BOQ. It was unsatisfactory that BOQ’s Performance Management Policy made no reference to the PIP process, with the result that the process was not fully transparent to all employees. Nonetheless, performance plans which clearly identify targets for improvement, require achievement of those targets within identified timeframes, and which provide support and feedback to employees to assist them to achieve such targets, are a legitimate and commonly used means to improve employee performance. In that context, the use of the PIP process by BOQ in relation to Ms Mac was reasonable.

Relevance

Where an applicant wishes to allege that the decision to implement a PIP amounted to bullying, such applicants must demonstrate that the decision to introduce the PIP lacked any evident and intelligible justification such that it would be considered by a reasonable person to be unreasonable in all the circumstances.

Ferguson and Commonwealth Bank of Australia [2012] AATA 718 (17 October 2012).

Facts

An employee claimed she developed a major depressive disorder as a result of bullying and harassment at work. The employer appointed a new manager to an under-performing branch. The new manager had a number of one-on-one meetings with the employee relating to her performance and minimum standards. The employee claimed that the manager’s manner was rude and belittling.

Outcome

The employer accepted that events at work had contributed to a significant degree to the employee’s mental health condition, but her compensation claim was refused because it was the result of reasonable administrative action taken in a reasonable manner in respect of her employment. The Administrative Appeals Tribunal affirmed the decision.

Relevance

The mere fact that management action might have been conducted differently or in a more reasonable manner does not automatically render the management action unreasonable.

Yu and Comcare [2010] AATA 960 ((1 December 2010), [(2010) 121 ALD 583].

Facts

A high school teacher claimed she suffered a psychological injury which was significantly contributed to by her employment, including the implementation of a performance management process. Her compensation claim was refused on the basis that her condition was a result of ‘reasonable administrative action undertaken in a reasonable manner’.

Outcome

The Administrative Appeals Tribunal overturned this decision on appeal, finding that the employer failed to comply with the applicable employment instruments and policy provisions. This went well beyond ‘… a matter of legal or technical nicety’.

The Tribunal held that the management action in question was not within the meaning of ‘reasonable administrative action’ and that it was not undertaken in a reasonable manner. The worker for example had been denied procedural fairness and no documentation was produced setting out the evidence concerning the worker’s alleged underperformance.

The Tribunal noted that the employer’s inadequate record keeping may have adversely affected its case.

Relevance

It is important to keep records when dealing with performance or behaviour issues in the workplace. In this case it was in part the lack of evidence that the employer had complied with their own procedures and policies that saw the initial decision overturned.

Krygsman-Yeates v State of Victoria [2011] VMC 57 (4 November 2011).

Facts

An experienced teacher alleged that she sustained an adjustment disorder with mixed anxiety and depressed mood as a result of having her performance as a teacher subjected to monitoring and mentoring, and being bullied and harassed by the school principal. Her compensation claim was refused on the basis that her condition was a result of ‘management action taken on reasonable grounds and in a reasonable manner…’.

Outcome

The Court found that the action taken was ‘management action’ based on reasonable grounds. The teacher’s employer had a legal duty and responsibility to respond to and take action in relation to complaints it had received about the teacher’s performance. However the management action was not taken in a reasonable manner because:

• a three-page letter detailing performance-related issues was provided to the worker on her first day after returning from long service leave
• guidelines on monitoring and mentoring weren’t followed
• feedback was not provided to the worker during the monitoring and mentoring processes, and
• insensitive and unreasonable action was taken by continuing to provide comment by the delivery of letters, given the worker’s ‘eccentricities and her previous emotional response and reaction to receiving [such] letters’.

Relevance

The failure of the employer in this matter to comply with their own procedures and policies saw that whilst the management action was taken on reasonable grounds, it was not taken in a reasonable manner.