Australia: High Court - Barclay decision - adverse action

The High Court of Australia unanimously determined that the first instance decision of Justice Tracey in the Federal Court of Australia was the correct one, thereby overturning the decision of the Full Bench of the Federal Court.

Mr Barclay was an Australia Educational Union (AEU) representative in his workplace, Bendigo Regional Institute of Technical and Further Education (Bendigo TAFE). Several AEU members had expressed concerns about false and fraudulent documents being prepared at the Bendigo TAFE. These members informed Mr Barclay they did not wish any further action to be taken or their names disclosed.

After a number of different such complaints made by employees to Mr Barclay, he sent an email to AEU members at Bendigo Tafe advising that some members had made such claims and that if an employee was feeling pressured they could contact the AEU for support and advice. This email came to the attention of Management of Bendigo TAFE.

Bendigo TAFE attended a meeting with the CEO of Bendigo TAFE, Dr Harvey, at which he was given a letter asking him to show cause why he should not be subject to disciplinary action for serious misconduct. Bendigo TAFE then suspended Mr Barclay on full pay on the basis he had breached the code of conduct for Victorian Public Sector Employees.

Mr Barclay brought an action claiming he had been the subject of adverse action (the suspension) under the Fair Work Act 2009 (Cth) (the Act) for a prohibited reason. A prohibited reason included because an employee is an official of an industrial association or engages in industrial activity.

Under s 361 of the Act Bendigo TAFE bore the burden of proving they had not subjected Mr Barclay to an adverse action for a prohibited reason.

The HCA held that Bendigo TAFE had not taken adverse action for a prohibited reason on the basis the suspension was not because of the "industrial activity" but because Bendigo TAFE was concerned that Mr Barclay had not reported concerns about the fraudulent practices directly to management.

Justices French and Crennan noted that the burden for an employee to prove that adverse action was not for a prohibited action was not made heavier because the employee is an officer of an industrial association. Furthermore the fact Mr Barclay was an officer of an industrial association did not mean that necessarily had something to do with the adverse action taken against him.

In their words Bendigo TAFE,

It was relevant that Dr Harvey had given evidence which was accepted as convincing and coherent. Dr Harvey's evidence was that she would have made the same decision whether Mr Barclay was an officer of an industrial association or not.

It was also significant that Mr Barclay did not challenge the factual findings of the first instance decision of Justice Tracey in accepting Dr Harvey's evidence, and finding that the Bendigo TAFE had not taken adverse action against Mr Barclay for a prohibited reason.

The Full Court of the Federal Court of Australia had drawn a distinction between conscious and unconscious reasons, believing that the real reason for some conduct could be unconscious. This approach was dismissed by the High Court, and labelled by Justice Heydon as "indefensible". He stated

The confidences entrusted to Mr Barclay by his fellow employees, indicated conduct that breached the employer's standards and Mr Barclay in not informing management of the conduct may have breached the code of conduct for the Victorian Public Sector Employees. Bendigo TAFE was successful in arguing that this and not his AEU membership or industrial activity was the reason for his suspension.

For further information please contact:

Richard Ottley, Partner
Phone: + 61 2 9233 5544
Email: rbo@swaab.com.au

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