An unusual set of circumstances was considered in a recent Federal Court decision, Ermel v Duluxgroup, 1 which found that an employer had not taken adverse action against one of its former employees, despite it referring to that employee taking sick leave in its termination letter.

It is unlawful for an employer to take adverse action against an employee in relation to that employee exercising a “workplace right”. Taking sick leave (referred to as personal/carer’s leave under the Fair Work Act 2009 (Cth))  is an example of a workplace right.

Background

Mr Ermel had been employed by Dulux as a procurement manager since July 2010. Dulux acquired another company at the end of 2012, which led to Dulux undergoing a restructure. During this time, Mr Griffith, who was Mr Ermel’s manager, determined that Mr Ermel did not possess the skill set necessary to carry out the expanded duties which would be required of him following the restructure, and he recommended that Mr Ermel be redeployed to a new position within the new business structure.

Mr Ermel objected to the letter of offer which was given to him in relation to this new position. He claimed “there was nothing in it for him” and that its terms would be disadvantageous to him. He argued that offering the new position amounted to a constructive dismissal.

Mr Ermel was given until 12pm on 31 May 2013 to accept the new position.Mr Griffith was under the impression that Mr Ermel had promised to be at work at 9am on 31 May 2013 to provide his response.

Shortly after 9am on 31 May 2013, Mr Ermel rang Dulux and left a message with a receptionist that he would not be at work that day due to illness. This message was not communicated to Mr Griffith. Mr Griffith attempted to ring Mr Ermel on his mobile phone during the morning but did not succeed in making contact.

Mr Ermel’s solicitors sent a letter to Dulux at around 11am on 31 May 2013 alleging that Dulux had acted improperly in making the new offer to Mr Ermel. The letter stated that “We trust that any ‘appropriate action’ will be delayed until our client’s concerns have been investigated and addressed by the company.” Mr Griffith was shown the letter prior to 12pm.

Shortly after 12pm, Mr Griffith decided to terminate Mr Ermel’s employment as he had not accepted the letter of offer by the set deadline. At around 12.30pm,Mr Griffith sent a termination letter to Mr Ermel which stated:

On Wednesday 24 April, 2013, we offered you the role of Procurement Manager Sourcing. This role is within your skills, qualifications and experience, does not submit you to unreasonable geographic disadvantage and recognises your prior service with us.

Given you had taken so long to respond to the offer and when you did, you refused to sign it, after we responded to your questions about more money and you still refused to sign the offer we have now accepted your rejection of that offer.

In addition to rejecting the role, you have not attended work today and have not responded to my voice message for you to explain your absence.

In the circumstances, we are exercising our right to effect your termination today by paying out your notice period.

Did Dulux take unlawful adverse action against Mr Ermel?

If one of Dulux’s reasons for terminating Mr Ermel’s employment was that he took sick leave on 31 May 2015, it is likely that Dulux would have been found to have taken unlawful adverse action against him.

However, Justice Bromberg said that there was no evidence that Dulux or its senior managers had any “history of concern about or opposition to the taking of sick leave by employees” or by Mr Ermel.While Justice Bromberg did accept that Mr Ermel’s absence on 31 May 2013 as a minor factor in Mr Griffith’s thinking, he found that it went more towards Mr Griffith being assured that Mr Ermel had rejected the letter of offer rather than being one of the reasons for dismissal.

In other words, Justice Bromberg found that there was nothing that proved any link between the decision to dismiss Mr Ermel and his taking of sick leave. This was reinforced by his finding that, at the time Mr Griffiths dismissed Mr Ermel, he was not aware that Mr Ermel’s absence was a result of Mr Ermel taking paid personal leave or due to his illness.

Mr Ermel’s claim for adverse action was dismissed. Justice Bromberg noted that Mr Ermel could have brought a claim for unfair dismissal but had not done so.

Bottom Line for Employers

Employers should be careful to ensure  that, should they reach the point of terminating an employee’s role, they do not provide the employee with any reason to think that they have been terminated for exercising a workplace right, whether it be for taking sick leave or otherwise.

Even if, as was the case with Dulux, the employer is vindicated, such a conclusion may only be reached at the end of potentially lengthy and expensive litigation. As always, prevention is better than cure