Authors: Emma Pritchard, Zeb Holmes & Callum Sirker

A Court has levelled a hefty penalty against an HR manager for mismanaging a termination that involved adverse action taken to prevent the employee making a claim to the Fair Work Commission. Judge Blake’s decision in United Workers’ Union v Bervar Pty Ltd (No 2) [2023] FedCFamC2G 251 is a prudent reminder of the potential financial consequences for individual accessories to an employer’s mistakes.

Facts:

The employee, Ms Talwinder Kaur, had emigrated to Australia from India in 2013, and English was not her first language. Ms Kaur commenced work with the employer, Bervar (a pizza manufacturer), on 11 August 2015. She had been employed by Bervar for 4 years, 9 months steadily progressing through the ranks with a series of promotions.

Ms Kaur then clashed with her manager and a colleague over changes to her responsibilities and overtime requests. Shortly afterwards, Berver held an early morning performance management meeting with its production manager and HR manager, Cameron Blewett.

Ms Kaur was provided no notice of this meeting, nor an opportunity to bring a support person.  Approximately 2 hours after the meeting, Ms Kaur left work due to her stress, part way through her shift without clocking out.

Mr Blewett told the court that he rang Ms Kaur’s mobile to carry out a “welfare check” later that day. Ms Kaur instructed him to speak to her husband, who declared that she would not be returning to work. Ms Kaur’s husband told Mr Blewett that she had been bullied and harassed at work and that they would be taking the matter to “Fair Work”.

Mr Blewett said that he accepted Ms Kaur’s resignation from her employment. Mr Blewett never spoke to Ms Kaur directly to confirm this resignation, and just assumed that Ms Kaur’s husband had the authority to speak for his wife.

Judgments:

In the initial liability decision, Judge Blake found that Mr Blewett had called to conduct a welfare check and, in the course of that call, had found out that Ms Kaur was extremely upset and considered that she was being bullied and harassed at work. Relevantly, he also found out Ms Kaur was considering taking the matter to “Fair Work”. The Judge found that Mr Blewett’s response was not to enquire further about her welfare but to “avail himself of the first opportunity to remove her from the business”, in breach of section 340 of the Fair Work Act (which prohibits the taking of adverse action because a person proposes to exercise a workplace right).

Judge Blake also found that Mr Blewett had failed to undertake the basic requirements expected of a person within HR management, including by mismanaging the performance review and termination processes. The Court found that Mr Blewett’s conduct was a “deliberate” breach of the section, as he was concerned Ms Kaur would exercise her workplace rights and he took the first opportunity to avoid a long drawn-out litigation process for Bervar by terminating her employment, under the guise of accepting a resignation that was not properly made.

In the decision on penalty, Judge Blake observed that Mr Blewett filed an affidavit after the liability judgment, but before the hearing on penalty and compensation, and had the opportunity to state in clear terms that he had made a mistake. He did not take that opportunity and neither Bervar or Mr Blewett expressed any “contrition or remorse” for dismissing Ms Kaur, battling till the very end and even maintaining the Company would have made the same decision if they had another opportunity to revisit the matter.

The breach of section 340 of the Fair Work Act was said to be “serious”, involving senior management, in “somewhat egregious” circumstances. Judge Blake did discount the penalty given it was as a first offence: fixing it at 60% of the maximum, in fining Bervar $37,000 and Blewett $7,560.

In providing this total penalty, Judge Blake believed there was a “high need” for specific and general deterrence, adding that that the conduct “cannot be condoned by the court” with a penalty needing to be set at a level likely to deter others from engaging in similar conduct.

After weighing up the evidence, Judge Blake believed it as more than likely than not that Ms Kaur would have retuned shortly after she had left the workplace and continued working for Bervar. He therefore also awarded Ms Kaur $47,834.26 for economic loss; and $9,000 as general damages, together with interest from the day of dismissal in May 2020.

Implications for Employers

Employers and their HR staff should tread carefully when dismissing their employees, as significant penalties can be applied against the company, but also those individuals involved in the decision to terminate the employment or take other action against an employee.

If you require employment law advice or assistance to ensure that you are compliant and not liable for individual penalties, please contact our Harmers legal team by phone: +61 2 9267 4322.

© Copyright Harmers Workplace Lawyers 2023. All rights reserved. No part of this alert may be reproduced, in whole or in part, by any means whatsoever, without the prior written consent of Harmers Workplace Lawyers.

Disclaimer: This news alert provides a summary only of the subject matter covered without the assumption of a duty of care by the firm. No person should rely on the contents as a substitute for legal or other professional advice.