Author: PWLadmin

A Fair Work Commission (“FWC”) full bench, in Raymond Briggs –v- AWH Pty Ltd [2013] FWCFB 3316 (5 June 2013), has upheld the dismissal of an employee who refused to provide a urine sample for a random drug and alcohol test because he argued that a saliva sample, for which he was willing to provide, was more appropriate to assess impairment. 



The employee was a Stores’ Officer with AWH Pty Limited.

Vice President Adam Hatcher, Senior Deputy President Jonathan Hamberger and Commissioner Michelle Bissett, rejected the employee’s argument that Commissioner Williams was “wrong” in finding that his dismissal was valid because he refused to abide by a “lawful and reasonable request.”

The FWC bench ruled that the Company’s direction that all employees take part in the blanket testing was authorised by the Company’s Alcohol and Drug Misuse Policy, to which the Stores’ Officer was “contractually bound to comply“. 



The direction from the Company was also “consistent with common practice in the employer’s own enterprise as well as the industry in which it operated“. 



The FWC bench found that the Stores’ Officer had refused to comply with the direction despite the Company giving him several opportunities over a week period, and further, warning the employee that he would be dismissed if he refused to change his position. 

The FWC bench said, “Simply put, he [the Stores’ Officer] was engaged in conduct that was repudiatory of his employment contract“. 

The FWC bench acknowledged that the Stores’ Officer had a right to seek to change the Company’s use of urine testing, “but there was a proper way to agitate his issue in the workplace which did not require him to defy his employer’s direction“. 



The bench said it was regrettable that the employee had “put himself in a position where his continuing employment stood or fell on the narrow question of whether his employer’s direction for him to undergo a urine test was lawful and reasonable,” most particularly, given that the employee had no concerns about passing either a urine test or a saliva test. 

The bench advised that the Stores’ Officer would have been best placed to utilise the dispute resolution mechanism available in the Company’s Enterprise Agreement instead. 


Drug Testing Methods Controversial

The FWC bench said that the issue of whether a urine or saliva sample is the most appropriate workplace drug testing method, “has proved to be controversial“, with industrial tribunals failing to reach consensus on the matter. 

It also noted the controversy over which of “two competing workplace interests” should be given priority, saying the interests, “might alternatively be characterised as workplace ‘rights’ in the social and ethical, if not the legal sense“. 

However, the bench also noted, “there is the interest of employees in not having their private behaviour subject to scrutiny by their employers” and, “there is the interest that employers and employees have in ensuring a safe working environment by the taking of all practicably available measures to detect and eliminate or manage risks to safety“. 

The bench failed to resolve the controversy over the testing methods. 

In New South Wales, directors and managers have onerous obligations and personal liability under work, health and safety laws. In New South Wales the obligation of an employer is to ensure the safety of the work environment. 

In fact, individuals who are concerned in the management of the corporation, managers, officers or directors of corporate bodies are personally liable to prosecution for breaches of work safety obligations by the corporation with which they are associated. 

In New South Wales, the approach is one of strict liability across the country. Liability is established if it is proved that:

In order for a person so charged to avoid conviction personally for the offence committed by the corporation, he or she is required to prove either:

It is not necessary that the corporation be prosecuted and convicted for the contravention before any director, or manager, is proceeded against.

Significantly, the Courts in New South Wales have adopted a very broad approach that by reason only of holding the office of director, the person charged is in a position to influence the conduct of the corporation – see Inspector Wayne James v Ngai & Ors [2007] NSWIRComm 20.

There is a requirement to demonstrate, in defence, that all due diligence was undertaken by the individual officer or director.  There is no statutory definition of “due diligence”.  The case law suggests that the notion of due diligence involves an absence of negligence or fault – see Australian Iron and Steel Pty Ltd v Environment Protection Authority (1992) 29 NSWLR 497.

The potential for personal liability for directors and persons involved in the management of a corporation to ensure the safety of the work environment is particularly onerous and more so, given broad legislative interpretation by the Courts in NSW raising the bar of an available defence in the event of prosecution.

Directors and officers now have a positive duty to be proactive in ensuring that their own personal obligations under the WHS Act are being met.  

The decision in Inspector James v Paul (No 2) [2011] NSWIRComm 117 serves as a timely reminder that the role of a director involves a greater degree of responsibility (and possible liability) than many people contemplate when accepting the position. This case concerned the liability of a director for the death of an employee of Dekorform Pty Ltd (Dekorform), who died of serious injuries sustained after a machine he had been operating malfunctioned. The director, Mr Robert Paul, who was not involved in the day to day operations of Dekorform, was found guilty of breaching sections 8(1) and 26 of the Occupational Health and Safety Act 2000 (NSW).

The definition of ‘officer’ under the WHS Act reflects the definition of ‘officer’ in the Corporations Act 2001 (Cth).  The definition of ‘officer‘ includes directors and board members but does not include, for instance, supervisors and middle management.

Officers are required to exercise ‘due diligence’ to ensure that the company is meeting its obligations under the WHS Act. This positive duty requires officers to:

1. acquire and keep up-to-date knowledge of work health and safety matters;
2. gain an understanding of the nature of the operations of the business and the hazards and risks associated with those operations;
3. ensure that the person conducting the business uses appropriate resources and processes to eliminate or minimise risks to health and safety from work carried out as part of the conduct of the business; and
4. ensure that the person conducting the business has appropriate processes for receiving and considering information regarding incidents, hazards and risks and responding in a timely way to that information.

Officers who breach their duties under the WHS Act expose themselves to significant penalties that include fines ranging up to $600,000.00 and five (5) years’ jail where the breach of the obligation recklessly exposes a person to risk of death or serious injury or illness. Given that the obligation is to exercise ‘due diligence’, an incident causing injury or death need not occur before an officer is exposed to risk of prosecution under the WHS Act.

Directors need to keep themselves informed about the company’s affairs and supervise the management and their business practices.  Importantly, this duty will not necessarily be satisfied simply by attending board meetings; if an event occurs which a director had not inquired about, but which could have been prevented had proper inquiry occurred, the director may be found liable for not discharging their duty under the Corporations Act.

To avoid being found liable for failure to discharge your duties under the WHS Act and the Corporations Act, current directors ought to:

• regularly incorporate work, health and safety recognition into board meetings;
• ensure that worksites are financially equipped to provide adequate safety equipment and training for those the WH&S Act is intended to protect;
• systematically consider and respond to work health and safety complaints swiftly; and
• get ‘hands on’ in the company, where appropriate – talk to ‘front line’ employees and find out about the day to day running of the business and other matters not usually discussed in board meetings.

Furthermore, effective 1 January 2014, new anti-bullying legislation shall commence operation.  As a result of this legislation, a worker shall have a right, if they believe they are being bullied at work, to apply to the Fair Work Commission (FWC) for an order to stop the bullying.   A worker is bullied at work if an individual or a group of individuals repeatedly behaves unreasonably toward the worker, and the behaviour creates a risk to health and safety.  The definition of ‘bullying’ is expressly stated not to apply to reasonable management action carried out in a reasonable manner.  

 Be aware that the definition of ‘worker’ is broader than ‘employee’ and includes contractors, outworkers, apprentices, trainees, work experience students and volunteers.

When the FWC receives an application for an order to stop bullying, it must be dealt with within 14 days.  In considering whether an order should be made, the FWC must take into account any matters the FWC considers relevant, including the:

•           outcomes of any investigation into the matter at a workplace level, whether undertaken by the workplace, or another person;

•           procedures available to the worker to resolve grievances or disputes; and

•           outcomes arising out of any procedure available to the worker to resolve grievances or disputes.

If the FWC makes an order to stop bullying and that order is breached, civil penalty provisions will apply.

 

Consultation regarding Changes to Roster and / or Ordinary Hours of Work

Recent amendments to the Fair Work Act 2009 (Cth) (“the Act”) provide increased protections for employees, who will be entitled to the benefit of greater consultation in relation to proposed changes to their rosters and hours of work from 1 January 2014.

 

The new rostering protections:

• Modern awards
  • Modern awards will be varied, with effect from 1 January 2014, to require employers to consult employees about changes to their regular rosters, or ordinary hours of work. 
  • The amendments also allow employees to be represented for the purposes of such consultation. 
  • Employers will be required to provide information:

– about the proposed change,

– invite employees to give their views about the impact of the proposed change (including any impact in relation to their family or caring responsibilities), and

– consider any views given by the employees about the impact of the change before implementing the change.

• Enterprise agreements
  • All enterprise agreements made on or after 1 January 2014 must also include a consultation term that requires the employer to consult with employees about a proposed change to their regular roster or ordinary hours of work. 
  • This mandatory term will also require employers to provide employees with information about:

– the change,

– invite the employees to give their views about the impact of the change (including any impact in relation to their family or caring responsibilities), and

– consider any views given by the employees about the impact of the change. 

 

When the new rostering protections apply:

The new rostering protections will generally apply where any of the following industrial instruments apply to an employee:

• a modern award that has been varied to include the new consultation term;
• an enterprise agreement made before 1 January 2014 that incorporates a modern award as varied, amended or replaced from time to time (subject to any ‘inconsistency of provisions’ clause);
• an enterprise agreement made after 1 January 2014.

 

Impact on employers:

• Employers will be required to genuinely consult with affected employees prior to making a decision to change their regular roster or ordinary hours of work. 
• This will be a significant change for employers who are currently not subject to any such restrictions. 
• The consultation obligation will apply regardless of whether an employee is permanent or casual, where the employee has an understanding of, and reliance on the fact that, their working arrangements are regular and systematic. 
• The greatest impact of the change is likely to occur when employers wish to change the roster or working hours of part-time employees. 
• Although the requirement to consult with employees does not mean that an employer must reach agreement with employees, consultation must be meaningful and may involve representatives of the affected employees. 
• Employers will have to consider the impact of the changes on affected employees including, but not limited to, any impact on their family or carer’s responsibilities. 
• This opens the prospect of discrimination claims being made against employers who make changes to an employee’s ordinary hours of work despite objection from employees on the grounds of family or carer’s responsibilities. 
• Failure to comply with the new consultation obligations will amount to a breach of the modern award or enterprise agreement exposing the employer to penalties under the Act.

 

The changes for employers:

In preparation for the changes, employers should:

• Consider whether the increased roster and change of hours protections will apply to any of their employees,
• Keep track of the variations to relevant modern awards (including any modern award that is incorporated in the employer’s enterprise agreement) and the model consultation term,
• Be aware that, if they are currently in the process of negotiating an enterprise agreement, the new rostering and change of hours protections must be included in the agreement (unless the agreement will be made by 31 December 2013),
• Review their employment documents, including policies and procedures concerning changes to regular rosters and ordinary hours of work, to ensure that they will comply with the new obligations from 1 January 2014,
• Ensure that they comply with the new consultation obligations.  While consultation does not require an employer to agree with the affected employees, consultation must be meaningful.

 

Summary  of Changes to the Fair Work Act 2009 (Cth)  

Amendments to the Fair Work Act 2009 (Cth) by way of the Fair Work Act Amendment Act 2013 came into effect either on 1 July 2013, or shall come into effect from 1 January 2014.

Significant changes that employers need to be aware of include; the ability for employees to apply to the Fair Work Commission (“FWC”) for an order to stop bullying, the right for unions to hold meetings in lunch rooms, an expansion of the right for employees to request flexible working arrangements and an extra obligation on employers to consult employees when changing rosters and ordinary working hours.

These changes will require amendment to most employers’ workplace policies.

Changes that commenced on 1 July 2013:

The changes noted here commenced on 1 July 2013.

Family-friendly changes:

The changes mean that:

• pregnant women can transfer to a safe job even if they have not worked for their employer for 12 months;
  • if a safe job is not available, the employee is entitled to unpaid ‘no safe job leave’;
  • employees can take special maternity leave without it reducing the amount of unpaid parental leave they can take;
  • employee couples can take up to 8 weeks unpaid parental leave at the same time (increasing from 3 weeks), and can take it in separate periods (eg. two periods of 2 weeks off);

 Right to request flexible working arrangements:

More groups of employees now have the right to request flexible working arrangements, including, if they:

• have responsibility for the care of a child who is of school age or younger;
• are a carer within the meaning of the Carer Recognition Act 2010 (Cth);
• have a disability;
• are 55 years or older;
• are experiencing violence from a family member; or
• provide care or support to a person within their immediate family or member of their 
household, if that person requires care or support because they are experiencing violence.

Changes to the Act from 1 January 2014

The changes noted below will apply from 1 January 2014.

New anti-bullying measures:

One of the biggest changes to be implemented as a result of this legislation is the right for a worker who is bullied at work to apply to the FWC for an order to stop the bullying.   

A worker is bullied at work if an individual or a group of individuals repeatedly behaves unreasonably toward the worker, and the behaviour creates a risk to health and safety.  The definition of ‘bullying’ is expressly stated not to apply to reasonable management action carried out in a reasonable manner.  

Be aware that the definition of ‘worker’ is broader than ‘employee’ and includes contractors, outworkers, apprentices, trainees, work experience students and volunteers.

When the FWC receives an application for an order to stop bullying, it must be dealt with within 14 days.  In considering whether an order should be made, the FWC must take into account any matters the FWC considers relevant, including the:

•         outcomes of any investigation into the matter at a workplace level, whether undertaken by the workplace, or another person;
•         procedures available to the worker to resolve grievances or disputes; and
•         outcomes arising out of any procedure available to the worker to resolve grievances or 
disputes. 


If the FWC makes an order to stop bullying and that order is breached, civil penalty provisions will apply.

Changes to right of entry rules:

These changes affect the rights and powers of officials of organisations who have entry permits to enter businesses.  The amendment allows unions to hold meetings in employee lunch rooms, and requires employers to provide accommodation and transport for union permit holders exercising right of entry at work sites in remote areas. 


Additionally, the FWC will now be able to deal with disputes about the frequency of union permit holders entering work premises to hold discussions with one or more employees.  The FWC can deal with the dispute by way of arbitration and can make orders such as suspending or revoking an entry permit and imposing conditions on an entry permit.

The changes will mean that:

• interviews and discussions with employees must be held in an area that the business and permit holder agree to (lunch rooms can be used if no agreement can be reached);
• the FWC will be able to deal with disputes about the frequency of visits;
• the FWC will be able to: 

◦       deal with disputes about accommodation and transport arrangements, and

◦       ensure appropriate conduct by permit holders while they are receiving accommodation or being transported under the arrangements.

Genuine consultation on changes to rosters and hours of work:

Enterprise agreements, commencing after 1 January 2014, and modern awards, must now include a term requiring the employer to consult with employees about a change to their regular roster or ordinary hours of work.   This is in addition to the current requirement that employers consult with employees about major workplace changes that are likely to have a significant effect on the employees.  All awards and agreements will have to include a term that requires employers to genuinely consult with their employees about changes to their regular roster and ordinary working hours.

So, when employers want to change an employee’s regular roster or ordinary hours of work they will have to:

• give information to employees about the changes,
• invite employees to give their views about how the changes will affect/impact them, including the impact in relation to their family or caring responsibilities, and
• consider the employees views about the impact of the change.

Agreements will also require employers to consult about any major change to a workplace that is likely to have a significant effect on the employees.

Protection of penalty rates:

The modern award objective in the  Act will be amended to protect penalty rates.  This will mean that the FWC, when making or changing a modern award, will have to take into account the need to provide additional pay for employees working:

• overtime,
• unsocial, irregular, or unpredictable hours,
• on weekends or public holidays shifts.

Implications for Employers

The changes to the FW Act are significant and will require employers to review workplace policies to ensure they comply with the amendments.  This would involve amending any grievance or workplace behaviour policy to ensure employers have a robust complaints/dispute procedure (to avoid an employee making a claim to the FWC for orders to stop bullying before the complaint has been dealt with internally), updating parental leave policies, modify right of entry policies or processes, and potentially amending clauses in an enterprise agreement where the agreement is up for renewal after 1 January 2014.

Welcome news regarding independent contractors…

New Small Business Minister Bruce Billson has engaged in discussions with Treasury officials on sticking “to the letter of the law” in determining whether someone is an independent contractor or employee, and intends to hold similar discussions with other agencies and departments.

The Coalition sees the former Labor government as having pushed from independent contracting toward employment arrangements.

A spokesperson for Mr. Billson confirmed the Minister would also be talking to the ATO, Fair Work Ombudsman and Fair Work Building and Construction.

The Coalition’s small business policy, released in the lead-up to the September 7 election, says Labor “tasked” the three (3) organisations “to target independent contractors“, which “will eventually force them into union-controlled enterprise agreements“.

The small business policy states that the Coalition “will support Australian independent contractors and will not change current laws relating to the treatment of personal services income, in addition to resisting Labor’s coordinated attack on the self-employed“.

The ACTU, however, said that any “relaxation” of the rules around independent contracting by the Abbott Government would lead to more exploitation of employees under sham contracting arrangements.   Peak body president Ged Kearney described sham contracting as “one of the dirty secrets of the modern Australian workplace“.

“While contracting is appropriate in some industries where services are in demand, it is also rife in industries like hairdressing, cleaning, call centres and textiles, where workers have little choice or bargaining power,” Ms. Kearney said. “It’s all very well to encourage self-employment, however where people are effectively working as employees, they deserve all the protections afforded to employees by the law.“

What’s redundancy?

Redundancy under the National Employment Standard happens when an employer either:

• decides they no longer want an employee’s job to be done by anyone and terminates their employment (except in cases of ordinary and customary turnover of labour), or
• becomes insolvent or bankrupt.

Note: What constitutes ordinary and customary turnover of labour will depend on the relevant circumstances.

Redundancy may happen when:

• the job someone has been doing is replaced due to the employer introducing new technology (i.e. it can be done by a machine)
• business slows down due to lower sales or production
• the business relocates
• a merger or takeover happens
• the business restructures or reorganises.