27 Aug August Newsletter: Focus on HR Managers in Recent Court Decisions

Focus on HR Managers in Recent Court Decisions

The first decision concerned a penalty decision by Manousaridis J, after he found that an employer and two of its HR Managers had engaged in adverse action against an employee.  In the original decision, Manousaridis J found that the employer had contravened the Fair Work Act 2009 (Cth) (“FW Act”) when it required an employee to sign documents (being a new employment contract) for reasons that included (as a substantial and operative factor) the employee ceasing his membership with the Construction, Forestry, Mining and Energy Union.

Two HR Managers were found to be ‘involved’ in the contravention.  They required the employee to sign the documents, moving the employee from a salary contract to a wages contract, telling him that his “role as a Safety Officer and being on a salary doesn’t work out”.  Even though the employee told the HR Managers that “he did not understand why he was going back to wages”, they insisted he sign the documents.  Manousaridis J found that both HR Managers “concealed the true reasons for their conduct”.

Manousaridis J said “it was relevant that two of the three [managers] were employed in roles in which they were expected to know, or to make it their business to known, [the employer’s] obligations under the FW Act”.  His Honour also noted that neither HR Manager brought evidence to show that they disagreed with the original decision maker.  In this regard, he said that the pecuniary penalty “should incorporate an element of general deterrence to deter persons in subordinate positions from complying with directions from superiors to engage in conduct that may involve contraventions of the FW Act”.

Each HR Manager was fined individually $3,500.00, whilst the employer was also fined $25,000.00, all of which would be paid to the Commonwealth.

The second case concerned an employer who breached the FW Act by failing to provide appropriate notice of termination.  The employee was provided with one month’s notice, instead of five weeks’ notice, falling two days short of the statutory requirement.

The employee had suffered a workplace injury a number of years earlier.  After the employer received correspondence from WorkCoverSA, clearing it of its obligation to employ the employee under the relevant legislation, it chose to terminate the employee’s employment, providing one month’s notice.  The respondents argued that the employee’s employment ended by the doctrine of frustration, because he could no longer “carry out the work [the employer] requested him to perform”.  As such, they argued notice was not required.  However this was rejected by Simpson J, who found that the fact that the employer delivered a letter of termination meant that it thought there was an employment contract in place, meaning the doctrine could not apply.  Simpson J determined that a breach by the employer had occurred and that the HR Manager was ‘involved’ in the contravention.

These cases highlight the important role Human Resources professionals play in the workplace and the potential consequences of contravening the legislation.  It’s important to ensure you are aware of your employees’ obligations, particularly when engaging in potentially adverse conduct. We would be happy to assist you with any HR processes or procedures to ensure you are complying with the legislation.

The content of this article is intended to provide a general guide to the subject matter.  Specialist advice should be sought about your specific circumstances.