The general protections waters continue to be muddied, as an employer recently admitted to liability in the Federal Court for threatening to take adverse action based on prohibited reasons revealed in its own internal commercial documents.

In this In Brief, we examine the Federal Court’s penalty decision in National Tertiary Education Industry Union v Swinburne University of Technology (No 2) [2015] FCA 1080 (8 October 2015) and consider its broader implications.


In addition to tertiary courses, Swinburne University of Technology (Swinburne UT) also offers pre-university programs and intensive English language courses for overseas students.  These courses are delivered through ‘Swinburne College’, an organisational department of Swinburne UT.

In late 2008, Swinburne UT began work on a series of plans to turn Swinburne College into a free-standing corporate entity to make it more commercially viable.  

Part of this plan involved the transfer of the ‘organisational department’ workforce employed by Swinburne UT to a new entity – Swinburne College Pty Ltd (SCPL) – of which Swinburne UT would be the sole shareholder. 

During the restructure process, Swinburne UT formulated various plans which identified that one of the reasons for creating SCPL was “to deliver programs which are largely free of the inflexibilities which flow from being University accredited programs delivered under inappropriate industrial arrangements.” [1] (emphasis added). 

By late 2012, as these plans progressed, greater detail about the financial benefits Swinburne UT would gain from SCPL were revealed.  Several internal documents set out in depth Swinburne UT’s desire to no longer have employees covered by the Victorian TAFE Teaching Staff Multi-Business Agreement 2009 (TAFE MBA).  Swinburne UT’s internal documents included reference to relative pay scales under the TAFE MBA and the applicable modern award; for example, a teacher on the highest pay scale received $82,619 under the TAFE MBA but would receive $39,657 under the award.

Further, in a document entitled “Swinburne College: Workforce Project Plan”, objectives of the restructure were said to include employment arrangements that:

  • “…Minimise union involvement and disputation; and
  • Avoid the agreements currently in place at SUT applying to SCPL as a result of a transmission of business.”[2]

In early 2013, four employees were employed by SCPL and an application was made to the Fair Work Commission (FWC) for approval of an enterprise agreement to apply to SCPL.

By this time, the NTEU had become aware of Swinburne UT’s plans, and intervened to oppose approval of the proposed SCPL agreement in the FWC proceedings. Swinburne UT subsequently withdrew its agreement approval application.

The NTEU then brought proceedings under the general protections provisions in Part 3-1 of the Fair Work Act 2009 (Cth) (FW Act). The union argued that Swinburne UT and SCPL had threatened to take adverse action against the Swinburne UT teaching staff and educators, for reasons including that they had an entitlement to the benefit of an industrial instrument, i.e. the TAFE MBA, (section 340(1)(a)(i)).


Ultimately, the proposed transfer of teaching programs from Swinburne College to SCPL did not occur. Swinburne and the NTEU reached a settlement in March 2015, in which Swinburne admitted to a single contravention of section 340 of the FW Act.

The Federal Court proceedings therefore related only to the issue of the appropriate penaltyto be imposed on Swinburne UT.  However, in her judgment, Justice Mortimer went through the facts in detail and set out the basis for Swinburne UT’s liability.  

Justice Mortimer found that the contents of the internal Swinburne UT commercial documents clearly revealed that a substantive and operative reason for the proposed restructure was a prohibited reason.  When addressing the issue of penalty Justice Mortimer considered that while the restructure had some legitimate aims, the ‘workforce planning’ as it was described in the internal documents (i.e. the prohibited reasoning) was an integral part of the proposal that featured prominently in Swinburne UT’s documentation.[3]

The only real issue of any contention was that while these documents certainly contained the threatened adverse action as well as the prohibited reason behind that action, the documents of themselves did not constitute a threat. It was held that the commercial documents did not constitute a ‘threat’ because they were not directly or even indirectly communicated to the Swinburne UT teaching staff and educators.[4] 

Justice Mortimer agreed with Swinburne UT’s position that the ‘threat’ itself was only evident in emails it had sent to the NTEU and in its application for approval of the SCPL enterprise agreement.[5]  As to the nature of that threat: ‘[t]he adverse action threatened was that the security and continuation of [Swinburne College employees’] employment was likely to be diminished or adversely affected; ... and their position may therefore eventually become redundant ...’.[6]

The penalty ultimately imposed on Swinburne UT by Justice Mortimer was $14,000, to be paid into consolidated revenue. This figure was determined by having regard to a range of factors, including:

  • the part of senior officers within Swinburne UT in the breach, contributing to ‘the calculated nature of the contravention’;[7]
  • the fact that this was Swinburne UT’s second breach of the FW Act within a fairly short period;[8]
  • the absence of any contrition or remorse, despite Swinburne IT’s admission of a contravention.[9]


In this case, Swinburne UT was held accountable for a decision that it ultimately did not follow through with on the basis that it was a threat to commit adverse action.

The use of Swinburne UT’s commercial documents against it to determine the substantive and operative reasons for its decision, which is typically a contentious element of adverse action cases, emphasises the need for employers to:

  • consider whether referring to such contentious matters in internal planning documents gives rise to potential future liability, and to the extent possible, confine them to confidential and privileged communications with legal advisers; and
  • properly manage communications with their employees in a timely manner. 

More generally in relation to general protections cases, following the Full Federal Court decision in Construction Forestry Mining and Energy Union v Endeavour Coal Pty Ltd [2015] FCAFC 76[10] and Justice Bromberg’s dissenting opinion, there is some prospect that the High Court of Australia will reconsider the adverse action principles.

This may involve some reduction in the scope given by the High Court’s decision in Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd[2014] HCA 41,[11] for employers to rebut the presumption of adverse action by the decision maker giving evidence about his or her subjective belief as to the substantial and operative reason for the taking of adverse action. 

For example, employers have been able to rebut the presumption with arguments that the operative reason was the manner of the conduct while participating in an industrial activity and not the participation itself in that industrial activity; or that there was an overriding commercial imperative to reduce labour costs to remain market-competitive rather than because of an employee’s right to the benefit of an industrial instrument.

The High Court is still yet to hear the CFMEU’s application for special leave to appeal against the Endeavour Coal decision.[12] But if leave is granted, the case is shaping up as another opportunity for the High Court to provide important guidance on the general protections provisions. This is particularly significant in light of the FWC’s latest Annual Report showing that dismissal-based general protections claims increased 17.5% in 2014-15.[13]