Key Points:

Employers will probably be protected from unfair dismissal claims by employees who are subsequently convicted, but it will be harder to resist claims from employees who are subsequently found to have no case to answer.

Allegations of child sex abuse are extremely serious. When they occur in the workplace they raise questions relating to the security and health and safety of a range of parties. One would think the ability to terminate an employee accused of such behaviour in a school setting would be uncontroversial. A recent decision, however, suggests that this is not so and employers must now grapple with two cases providing conflicting guidance on terminating employees in these situations.

The most recent decision from the Full Bench of the Fair Work Commission (FWC) specifically considers the scenario where a teacher is charged with offences relating to child sex abuse and whether or not termination of employment in circumstances where an employee is not qualified to work with children can amount to unfair dismissal.

Not compelled by legislation

In Paul O'Connell v Catholic Education Office, Archdiocese of Sydney [2016] FWCFB 1752 a teacher applied for relief from being unfairly dismissed. This decision was a jurisdictional hearing that only considered whether a "dismissal" had occurred and if the FWC had jurisdiction to hear the matter. Mr O'Connell worked as a classroom teacher at a secondary school for girls in Sydney when he was charged with indecent assault on a person under 16 years of age. These charges were subsequently dropped a few months later.

As a result of this charge, Mr O'Connell was deemed to be a "disqualified person" under section 18(1)(b) of the Child Protection (Working with Children) Act 2012(NSW) (CP Act), which led to the revocation of his working with children clearance and a bar from performing any child-related work. The Catholic Education Office (CEO) argued that section 9 of the CP Act compelled it to end its employment relationship with Mr O'Connell, as it could not continue to employ him if he was not qualified.

The issues were whether it was open to the CEO to terminate Mr O'Connell's employment under the CP Act and, more importantly, if disqualification as a qualified person for teaching purposes meant that no termination had occurred but rather that O'Connell was no longer able to work.

The FWC found that section 9 of the CP Act does not compel an employer to stop employing a person, nor does it provide an employer with the immediate ability to terminate the employment of someone who becomes a disqualified person. Interestingly, the FWC found that it would have been open to the School to allocate non-child related work to O'Connell rather than terminate his employment. His unfair dismissal claim under the Fair Work Act 2009(Cth) was successful.

Or is it?

A Full Bench decision of the FWC in 2015, on virtually identical facts to those in O'Connell, appeared to have already decided this area of law.

In Dr Daniel White, Executive Director of Catholic Schools and legal representative of the Catholic Education Office, Sydney v Mr Gerald Mahony [2015] FWCFB 4952, the FWC decided that any continuation of the employment of a teacher, who became a disqualified person, was inconsistent with the purpose behind the CP Act and would be illegal. The Full Bench found that:

"in our view it cannot be fairly said that Mr Mahony's employment was terminated on the employer's initiative … the appeal is allowed on thebasis that employment could not have continued as this would have amounted to illegality."

Interestingly, the FWC in O'Connell seems to have turned this decision on its head, now saying that continuing such employment (with restrictions) would not be inconsistent with the Act, and would, in certain circumstances, be considered legal.

In O'Connell, the FWC found that the purpose behind the CP Act was to "protect children by imposing restrictions and requirements on persons who engage in child-related work". The FWC considered this position in light of section 9 which states:

"an employer must … not continue to employ a worker in child-related work if the employer knows or has reasonable cause to believe that… the worker is not the holder of a working with children check clearance"

The CEO in O'Connell argued that section 9 meant that "employing" in this context meant to "hire or engage" and because Mr O'Connell's clearance was revoked, they could not continue to hire or engage him and could therefore only terminate the employment relationship. The FWC disagreed with this approach, instead noting that the word "employ" had multiple meanings, including to "make use of or utilise". It was held that despite being a "disqualified person" for the purposes of undertaking child-related work, this did not preclude O'Connell from being used for non-child related work and therefore did not require the immediate severing of the employment relationship.

Importantly, the FWC highlighted that the power to dismiss employees is contained in contracts of employment, industrial instruments, and in some aspects of the public sector, certain legislation. In Mr O'Connell's case it was the Teaching Service Act 1980(NSW), not the CP Act, which contained this power.

What does this mean for teachers and employers?

The law is clearly not settled in this area, with the CEO considering appealing the decision in O'Connell. While the legal arguments have been presented, and will no doubt be contested should an appeal follow, there remains a competing question around the rights of an employing educational institution to terminate an employee who has lost relevant qualification due to allegations of child sex abuse.

It is likely that employers who dismiss employees that are subsequently proven in court to have committed a crime will remain protected from unfair dismissal claims. However, as O'Connell shows, resisting a claim from a worker who is subsequently found to have no case to answer may be more difficult.

The lesson to take away is that employers should proceed with caution until this area of law is settled, and in the meantime, if criminal proceedings are not finalised, due consideration should be given as to whether or not it is open to re-deploy the employee to another area before considering terminating their employment.