The Industrial Tribunals have for nearly 2 decades been called upon to conciliate and arbitrate disputes over the introduction of alcohol and drug policies, particularly aspects dealing with drug testing. Until now, while these Tribunals have been prepared to weigh in on some aspects, urine testing has been given the green light as the appropriate method of testing.

The Full Bench of Fair Work Australia has now upheld Senior Deputy President Hamberger’s Endeavour Energy decision by finding that it was open for him to come to the conclusion that urine testing for drugs would be unjust and unreasonable and that oral fluid testing should be adopted: Endeavour Energy v CEPU, ASU, APESMA [2012] FWAFB 4998.

SDP Hamberger in his first instance decision had decided that:

  • urine testing can show a positive result several days after smoking cannabis;
  • by that time, there is no capacity to affect safe work ie. there is no impairment;
  • oral fluid testing is readily available and does not show up historical use ie. it only shows more recent use and therefore is more indicative of possible impairment at the time of testing;
  • in these circumstances, urine testing would be unjust and unreasonable and oral fluid testing should be used.  

Endeavour Energy in context

Does this mean that the days of urine testing for drugs are over? No, but they may be on notice. There are a number of aspects of this decision which should be factored in to a review of existing policies and to any proposed policies.

Management prerogative

This decision could send shivers down the spine of a company manager. What is an industrial tribunal doing telling a company how to implement a safety policy?

In this case, the company agreed to have the method of testing arbitrated. The principles to be applied in that situation are that the Tribunal should “examine all the facts and not seek to interfere with the right of the employer to manage his own business unless he is seeking from the employees something which is unjust or unreasonable”.

The case therefore required SDP Hamberger to consider whether it was unjust or unreasonable for Endeavour Energy to adopt urine testing as opposed to oral fluid testing. In other words, he was asked to consider the respective merits of urine versus saliva testing and to decide the appropriate methodology to be adopted.

In a similar vein it is worth repeating an extract from SDP Hamberger’s earlier decision in Shell Refining (Australia) Pty Ltd v CFMEU [2008] AIRC 510:

“…random testing is an intrusion on the privacy of the individual which can only be justified on health and safety grounds. The employer has a legitimate right (and indeed obligation) to try and eliminate the risk that employees might come to work impaired by drugs or alcohol such that they could pose a risk to health or safety. Beyond that the employer has no right to dictate what drugs or alcohol its employees take in their own time. Indeed, it would be unjust and unreasonable to do so.”

The aim of drug testing

The proposed drug testing regime was found to be directed to identifying persons who may be impaired to prevent them from undertaking work. Since saliva testing was found to only detect recent use (within hours rather than days), it was considered to be a better indicator of likely impairment at the time of testing, particularly in respect to cannabis use (which was found to be the most prevalent concern).

In contrast, urine testing was found to detect use over a longer period of time so that a positive result could be obtained several days after a person had used a substance (certainly in the case of cannabis) by which time there was little likelihood of impairment.

The focus on the issue of impairment appears to be a big factor in this decision. Query whether a drug testing regime should be seen (or used) as an attempt to identify impaired workers. Drug testing does not test impairment, other than in the most obvious cases (and this was recognised).

Accordingly, a random testing regime should be seen and used as a deterrent strategy. It is the stick required to modify risk taking behaviour. It is a method to help identify people who may need assistance. It is one part of a holistic strategy which should have at its heart - awareness, training, counselling and support.

In this context, it is arguable that the question to address is what method of testing is the best deterrent. Query whether asking this question would have changed the outcome in this case.

Accuracy of testing method

A major (successful) argument against saliva testing in the past has been the relative accuracy and scope of the testing compared to urine testing. In this regard, it was found that:

  • Urine testing is more likely to pick up whether an employee has at some stage taken certain substances;
  • Both methods are susceptible to cheating (but the risk of this is low). There is some evidence that saliva testing is less susceptible to adulteration or substitution compared to urinalysis;
  • Australian standards exist for both methods, there are laboratories accredited for the analysis of both, and systems are in place to verify on-site testing devices for both (although the unions accepted in the appeal that AS 4760 for oral fluid testing does not provide for validation of on-site fluid testing devices in the same way that the relevant Australian Standard addresses urine testing);
  • Neither test directly for impairment. However, saliva testing tests for recent consumption and is therefore a better indicator of impairment for cannabis (the most widely used drug apart from alcohol) and urine testing may be unable to detect recent use of cannabis;
  • Oral fluid testing is being done by many other major employers in Australia (including relevantly in this case the two other electricity distributors in NSW);
  • There have been significant improvements in the reliability of current on-site oral fluid testing devices since mid-2010 (when this issue was addressed in the HWE decision).  

The accuracy considerations in this case appear to have been heavily influenced by the impairment focus and the cannabis focus. Query whether this was the wrong focus or at least too narrow a focus. Nevertheless, it must be acknowledged that this decision gives oral fluid testing a higher degree of acceptance as a valid testing method than previously.

The consequences for breach under the proposed policy

The proposed policy imposed serious consequences for breach, with a first and final warning to be given to employees for the first positive test result, and employees facing termination for a second positive result. In the context of testing results which may be unrelated to impairment, this was seen as a factor weighing against urine testing.

It is possible that if the policy was found to be more weighted to counselling and assisting employees in the initial stages this may have helped. Also, where policies are already well established, we would expect this aspect would have less weight.


The invasive nature of urine testing has always been an issue of concern for employers and employees. It was a factor in this case weighing in favour of saliva testing, which was described as ‘less offensive’. It is critical that privacy issues are well managed for testing, particularly for urine testing which is more invasive.

Previous decisions

The issue of this decision being different to previous decisions, in particular CFMEU v HWE Mining Pty Limited [2011] FWA 8288, was raised in the appeal. The key distinguishing features were held to be:

  • This case involved a new policy rather than changes to an existing policy;
  • The evidence as to the efficacy of on-site fluid screening devices was different;
  • The Senior Deputy President was obliged to make a decision based on the material before him.  

It was in this context that the Full Bench found that in considering the relative merits of both methods of testing there was no appealable error in deciding that saliva testing was the most appropriate method for Endeavour Energy to adopt. There is no doubt that this case turned on its own facts, however, it is also indicative of saliva testing gaining greater acceptance.

AMMA to appeal Full Bench decision

The Australian Mines and Minerals Association (AMMA), which was granted limited permission to intervene in the proceedings in support of Endeavour Energy, has announced that it will appeal the Full Bench’s decision to the Federal Court.

Drug and alcohol testing under the nationalised WHS laws

Another aspect of this case worth noting is the references to the new nationalised Work Health & Safety laws now operating in NSW. It was suggested in the appeal that not enough weight had been put on the employer’s right to determine how it manages its OHS obligations under those laws.

The Full Bench set out the primary obligation on Endeavour Energy to “ensure, so far as is reasonably practicable, the health and safety of workers…”. And the meaning of reasonably practicable being “that which is reasonably able to be done… in relation to ensuring health and safety, taking into account and weighing up all relevant matters including… the availability and suitability of ways to eliminate or minimise risk”.

The Full Bench stated that there is nothing in the new WHS Act obligations to dictate any particular form of testing and that there is no reason to conclude that testing for drugs by either method would not be properly considered to be a reasonably practicable measure to minimise risks to health and safety. They then go on to say that might especially be the case where the testing method has been determined by FWA through a resolution process agreed between the employer and unions concerned.

While that may well be right and provide some comfort in the context of this case, it reveals the tension that can arise when industrial relations meets safety. One possible outcome of this approach is that an industrial relations outcome reached through compromise does not necessarily equal best practice safety management. This may become more significant under the consultation requirements of the new laws.


There is no need for existing policies to be changed but this decision does signal the next step in the gradual acceptance of saliva testing as a valid alternative to urinalysis. Whether it has come far enough to be adopted in your workplace (or not) is an issue which should be revisited from time to time.