The Federal Court has endorsed a decision of a Fair Work Commission (FWC) full bench, overturning the reinstatement of a Sydney Harbour ferry master who failed a drug test after a ferry under his control struck a wharf pylon.

The decision is positive news for employers who seek to rely on full compliance with zero-tolerance drug and alcohol policies.


In July 2013, Mr Toms, a ferry master employed by Harbour City Ferries Pty Limited, agreed to attend work to replace another employee on an afternoon shift. While on duty, Mr Toms misjudged an approach to a wharf and the ferry struck a pylon. No one was injured, and no serious property damage was sustained. Mr Tom was, as a matter of routine, required to take a drug test. When the drug test returned a positive reading for cannabis, Mr Toms admitted that he had smoked marijuana the previous evening, as pain relief for an injured shoulder.

Harbour City has a zero-tolerance policy for drugs and alcohol, meaning that employees must not register a positive result in a drug test that exceeds the relevant Australian Standard.

Mr Toms was suspended immediately, and, after further investigation, was dismissed with five weeks' pay in lieu of notice.

Mr Toms brought an unfair dismissal application in the FWC, seeking reinstatement.

Originally, Deputy President Lawrence in the FWC found in favour of Mr Toms, concluding that even though he had "undoubtedly"breached the company's drug and alcohol policies and procedures, the dismissal was unfair.

Taking into account all relevant facts pertaining to this case and bearing in mind the object in the Fair Work Act 2009 (Cth) of ensuring a "fair go all round," Deputy President Lawrence found that a positive drug test was not proof of impairment, nor was there evidence of a link between the drug use and the incident.

This decision was overturned on appeal by a full bench of the FWC, which held that the zero-tolerance drug and alcohol policy was highly relevant, and the absence of proven impairment of Mr Toms was not. It identified that the core issue to be addressed was Mr Toms' "deliberate disobedience, as a senior employee, of a significant policy," rather than whether his drug use had a demonstrated or likely bearing on the incident.

Federal Court Appeal

Mr Toms appealed to the Federal Court, arguing that the FWC full bench decision had been affected by jurisdictional error. The Federal Court rejected this argument, finding that the FWC full bench had made valid findings in relation to the errors in Deputy President Lawrence's original decision-making process.

It noted that the FWC is not required, when making a determination as to whether a dismissal is "harsh, unjust or unreasonable," to take into account every single factor that could possibly tip the balance in favour of an employee.  Rather, the FWC is entitled to approach its task by focusing on considerations it considers to be relevant, while also complying with the criteria for considering harshness, etc.

Implications for employers

The endorsement by the Federal Court of the FWC full bench decision is positive news for employers with zero-tolerance drug and alcohol policies. An employer, particularly where public safety is involved, can require strict compliance with appropriate drug and alcohol policies, without being required to determine that a related safety incident was caused by an employee's impairment.