Navigating Workplace Rights – Employers Beware

The case highlights the often unappreciated legal risks to medical practices arising from the adverse treatment of workers, due to the general protections provisions of the Fair Work Act 2009 (Cth). In short, those provisions mean prosecution and litigation can flow from a wide variety of treatment of employees or independent contractors – the risk does not only arise in the context of dismissal.

Case history

The Windaroo Medical Surgery Pty Ltd engaged an overseas-trained GP who had migrated to Australia with his family. The medical practice provided the GP with a “letter of appointment” which the trial judge later described as “confused and confusing” as it did not clearly set out all relevant matters.

The conflict between the GP and the medical practice began because the GP was not paid for his services. The GP complained to a number of people about this, and also lodged a formal written complaint with the Fair Work Ombudsman. Following this, a director of the medical practice threatened the GP in what seemed to be an attempt to force him to withdraw his complaint.

The GP said these included threats to:

• not pay him for work he had performed
• reclaim money spent by the medical practice in recruiting him
• provide the Medical Board with patient complaints against him.

Medico‑legal issues

Under the general protections of the Fair Work Act it is unlawful for an employer to take “adverse action” against an employee or independent contractor because that person has exercised (or has proposed to exercise) a “workplace right”. Both “adverse action” and “workplace right” are defined flexibly, which means a variety of workplace scenarios can fall within the scope of the general protections (in contrast to the unfair dismissal provisions which only apply to the dismissal of an employee).

Importantly, the court can order a variety of remedies when it finds a person has breached the general protections, including awarding unlimited compensation or imposing pecuniary penalties. In a recent decision, a court awarded an employee $1,272,109 for past and future loss of wages (plus $24,626 in interest) and also required the employer to pay a pecuniary penalty of $50,000.²

In this case, the court found the GP had exercised a workplace right by making a formal written complaint to the Fair Work Ombudsman and that the medical practice had taken adverse action against him in threatening not to pay him if he did not withdraw the complaint. Consequently, the medical practice and the directors had contravened the Fair Work Act.

The medical practice was penalised $39,600 and two of the directors fined $11,800 in total as individuals. Additionally, the medical practice and the directors were ordered to pay the practitioner $24,724 in compensation for economic loss and distress suffered.

Discussion

This case should warn any persons operating a medical practice that there is a variety of behaviour that could be “adverse action” that contravenes the Fair Work Act – including:

• reducing an employee’s status and level of responsibility
• altering an employee’s roster
• investigating an employee’s conduct.

It could be unlawful if any of the above actions are taken because the employee has exercised a workplace right. The following actions have been found to be “workplace rights”:

• making a claim for workers’ compensation
• taking personal or carer’s leave
• making a complaint about a supervisor (either internal or external).

Medical practices should tread carefully when managing or dealing with a worker who has exercised a workplace right, and ensure they are in a position to prove that any “adverse actions” were not taken because of a relevant “workplace right”. Seeking a second opinion before proceeding with any adverse action can be effective in preventing claims.

Additionally, the decision highlights how the lack of clarity in contracts about critical matters, such as payment, can lead to acrimonious workplace disputes. Care should be taken in drafting relevant documents to provide a clear understanding of how such critical matters will work in practice.

Dev Pillay
Senior Associate
Moray & Agnew Lawyers

Website: moray.com.au

Dev Pillay is a Senior Associate at Moray & Agnew with over 13 years of high quality experience. Prior to this, Dev worked at leading national and global commercial law firms. Dev provides expert advice to medical professionals on the full spectrum of legal issues relating to employment, workers' compensation and regulatory/disciplinary proceedings. Dev has a special interest in the healthcare industry, which he has developed over a number of years.

References

1. Fair Work Ombudsman v Windaroo Medical Surgery Pty Ltd & Ors (No. 2) [2016] FCCA 2505.
2. CFMEU v Hail Creek Coal Pty Ltd [2016] FCA 1032.