Lawyers, Emily Haar and Eliza Hampton examine the decision in CFMEU v BHP and explain the ramifications it may have on future general protections applications.

Overview

The “general protections” in Part 3-1 of the Fair Work Act 2009 (Cth) (Act) are designed, among other things, to protect employees exercising workplace rights or engaging in certain “industrial activities”. Where an employee can show that adverse action (such as termination of employment) has been taken against them, section 361 provides that the burden of proof lies on the employer to establish that the action was not taken for a prohibited reason.

The case of CFMEU v BHP [2014] HCA 41 tested the operation of these provisions. In particular, it tested how far an employee could take their expression of dissatisfaction with their employer while still being considered to be exercising a right protected by the Act.

Mr Doevendans was a member of the Construction Forestry Mining and Energy Union (CFMEU). He had participated in a lawful protest organised by the CFMEU at the BHP Saraji coal mine in Queensland as part of ongoing bargaining. His conduct in the protest included waving a sign at passing motorists which read “No principles SCABS No guts”. His employment was terminated some months later on the basis that the words used in his sign, in particular the term “scab”, were inappropriate, offensive, humiliating, harassing, intimidating and in violation of BHP’s workplace conduct policy.

After his dismissal, the CFMEU commenced proceedings against BHP in the Federal Court alleging that Mr Doevendans’ employment was terminated because of his participation in the industrial action, in breach of the general protections. The dispute reagitated the issues the High Court had dealt with in Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500 (Barclay), concerning how to determine whether the reason for taking adverse action is a prohibited reason.

Federal Court – Primary Judgment

At trial, Justice Jessup concluded that the general protections had been contravened in two respects. First, Mr Doevendans’ conduct in holding and waving the sign involved participation in a lawful union activity for the purposes of section 347(b) (iii). Because his dismissal was a result of such conduct, it was concluded that the dismissal was in contravention of the general protections.

Second, holding and waving the sign could be characterised as representing the views and interests of an industrial association for the purposes of section 347(b)(v). Because the dismissal was a result of this conduct, it contravened the general protections.

In essence, Justice Jessup concluded that it was sufficient for the conduct which was the reason for the dismissal to be in aid of lawful union activity, for the dismissal to be prohibited adverse action in breach of the general protections.

He took an objective, rather than subjective, view of the decision, and while BHP’s evidence was accepted, it was not enough to preclude a finding that the action was taken for a prohibited reason.

Federal Court – Full Court

On appeal by BHP, Justices Dowsett and Flick concluded that Justice Jessup did not pay sufficient regard to the actual decision making process of BHP in terminating the employment of Mr Doevendans, in concluding that prohibited adverse action had been taken. They concluded that the enquiry required by section 361 must consider the subjective, or actual, reasons for taking the action.

Justice Kenny, who gave a dissenting judgment, agreed that Justice Jessup was in error in considering that the employee was dismissed because he participated in lawful activity organised by the CFMEU. Her Honour noted that the High Court in Barclay rejected the proposition that an employer must establish that the reasons for the adverse action were dissociated from union activity. Her Honour added that an employee’s activity is not insulated from adverse action by an employer because it happens to be done in the course of otherwise lawful industrial activity. A person can still step beyond protected action even when participating in lawful protest.

Justice Kenny did not, however, consider that the primary judge was in error in concluding that the employee was dismissed for representing or advancing the views or interests of the union, which was the second alleged ground of contravention found by Justice Jessup.

The Full Court upheld the employer’s appeal and set aside the orders made by Justice Jessup. The union sought special leave to appeal to the High Court and was successful.

Decision of the High Court

The High Court upheld the Full Federal Court’s decision. Chief Justice French, and Justices Kiefel and Gageler formed the majority. Justices Hayne and Crennan  dissented.

The Majority View

The majority held that sections 346 and 361 of the Act do not direct a court to enquire whether the adverse action can be characterised as connected with the industrial activities which are protected by the Act. Rather, a determination of fact as to the actual reasons which motivated the person who took the adverse action must be made.

Chief Justice French and Justice Kiefel stated that although the primary judge was correct in finding that Mr Doevendans’ participation in protected industrial activity did not form part of the reason for dismissal, by considering whether his conduct constituted industrial activity, his Honour incorrectly added an additional step to the considerations required by the Act. Once it was found that the actual reason for dismissal was not participation in industrial activity, the burden of proof had been discharged by BHP and this was the end of the enquiry.

Justice Gageler, in a separate judgment, approached the issue by considering how the actions of Mr Doevendans were considered by the employer in relation to its internal policies. Again, it was held that once it was found the employer had dismissed Mr Doevendans due to a breach of its workplace policy, that should have been the end of the inquiry.

On this basis, the High Court dismissed the appeal against the decision of the Full Bench.

The Minority View

Justices Hayne and Crennan each delivered separate dissenting judgments, but both preferred the approach of Justice Jessup at first instance.

Justice Hayne required a distinction to be drawn by BHP between the participation of Mr Doevendans in representing the views of the union through protected industrial activity, and the manner in which Mr Doevendans actually participated in the activity. If a distinction was not drawn by BHP when it terminated the employment of Mr Doevendans, then in His Honour’s opinion, the dismissal was connected with Mr Doevendans’ participation in the protected activity of the union.

Justice Crennan was not satisfied with merely asking BHP why the decision was made to dismiss Mr Doevendans and agreed with Justice Jessup that BHP’s evidence about the reason for the dismissal was not conclusive on the matter.

Potential  Consequences

This decision confirms that a dismissal for misconduct where the employee was acting on union business at the time is not automatically going to be a dismissal in breach of the general protections.

Employers still need to be careful, however. If the misconduct in question is not sufficiently removed from the industrial activity, adverse action may still be held to be in breach of the Act.

Any employer considering taking action in similar circumstances must be prepared to demonstrate a valid and lawful reason which clearly goes beyond the mere fact of engagement in protected industrial action. There are significant penalties under the Act for employers who fail to get this right.