A Full Federal Court has overturned a first instance decision which found that an employer had taken adverse action against one of its employees because of the employee’s mental disability. The Full Court found that the medical evidence did not expressly or impliedly link the employee’s misconduct with his illness and given the decision maker’s evidence that he had not acted for a proscribed reason, absent other evidence the dismissal could not be said to be for an improper purpose.

Implications for employers

The decision confirms the well understood position that it is the actual reasons of the decision maker that are paramount in negating an adverse action claim. Importantly, the Full Court stated that the existence of a close relationship between the adverse action and a prohibited reason does not mean that the two cannot be disaggregated. However, great care must be taken by employers to ensure decisions are not infected with a prohibited reason.


During the period early October 2007 until 15 August 2012, Mr Grant was employed as a solicitor by the Victorian Office of Public Prosecutions (VOPP). Mr Grant was performing well for the first three years of his employment. However, in late September 2010, Mr Grant severely fractured his leg in a non-work related incident. Mr Grant subsequently suffered from a series of complications and as a consequence, Mr Grant took a significant period of time off work and his work performance progressively deteriorated.

In July 2011, Mr Grant’s supervisor, Mr Bird, arranged a meeting to discuss Mr Grant’s frequent absences from work. Following the meeting, it was agreed that Mr Grant would (amongst other things) improve his arrival times at work and notify of absences by the required time. In August 2011, a further meeting took place at which Mr Grant was advised that his performance was not satisfactory and his absences were an ongoing concern. Mr Grant apparently explained that the underlying reason for these issues was his medical issues. It appears that during August 2011, there was some improvement in Mr Grant’s performance, although there were some ongoing difficulties in relation to his absences for blood tests.

During the period December 2011 to early February 2012, Mr Grant’s absences and performance resurfaced as a serious problem. In late January 2012, Mr Bird arranged a further meeting to discuss Mr Grant’s performance. During the meeting, Mr Grant advised that he was unwell. It was also asserted by Mr Grant that Mr Bird requested that he disclose the nature of his ongoing health problems and that Mr Bird gave Mr Grant four weeks to improve his performance or face formal performance management. It was agreed that Mr Grant would consult a doctor. Mr Grant asserted that during February 2012, he commenced a course of anti-depressants and experienced insomnia which impacted on his tardiness and performance. In mid-February 2012, Mr Grant advised Mr Bird and other relevant staff that he was suffering from depression.

On 15 February 2012, Mr Kenny, the VOPP’s Human Resources Manager, requested an opportunity to speak directly with Mr Grant’s doctor, or alternatively for Mr Grant’s doctor to provide a detailed medical report to get a better understanding of the medical issues involved and any work restrictions that applied.

On 24 February 2012, Mr Hyland, solicitor for the VOPP, prepared a letter to Mr Grant. The letter set out concerns in relation to Mr Grant’s performance, and requested that Mr Grant take leave with pay to enable him to provide detailed medical evidence in relation to his medical condition, the associated impact on his duties, and any work restrictions or modifications that might assist.

On 5 March 2012, Mr Grant provided a medical report which stated (amongst other things) that Mr Grant had a long term anxiety condition which had been complicated by excessive alcohol consumption and bouts of depression. However, the report went on to say that Mr Grant had started to respond to treatment for his recent depressive bout, had reduced his alcohol consumption and was insightful into the process required to regain his health and as such, his prognosis was excellent. Mr Kenny responded to the report by requesting that he speak directly with Mr Grant’s doctor in order to gain a better understanding about Mr Grant’s prognosis, the long and short term impact on his work performance, and any measures that could be put in place to assist Mr Grant.

On 7 March 2012, Mr Grant obtained a medical certificate which stated that he was responding to treatment and should return to work on 13 March 2012. On 9 March 2012, Mr Kenny responded to the certificate by stating that there was insufficient information to establish that Mr Grant was capable of returning to work, and requested that Mr Grant take paid leave until 23 March 2012 to obtain a more detailed medical report. Mr Kenny also requested that Mr Grant agree to an independent medical assessment by a specialist to gain a better understanding of his condition, and whether he was able to perform the inherent requirements of his position.

Mr Grant refused to undertake an independent medical assessment on the advice of his union. On 23 March 2012, Mr Grant obtained another medical certificate stating that he was continuing to respond to treatment and was fit to return to full duties on 26 March 2012.

On 26 March 2012, Mr Kenny met with Mr Grant and provided Mr Grant with a letter advising that an investigation was taking place in relation to allegations of misconduct which appeared to relate largely to Mr Grant’s failure to comply with a series of lawful directions. Mr Grant was stood down with pay pending this investigation. The investigation substantiated most of the allegations of misconduct and Mr Grant’s employment was subsequently terminated on 15 August 2012.

Mr Grant commenced proceedings in the Federal Circuit Court alleging that the VOPP had (amongst other things) taken adverse action against him because of his mental disability.

Decision at first instance

Justice Burchardt found that Mr Hyland had given honest evidence that his decision to terminate Mr Grant’s employment was based only on Mr Grant’s misconduct. However, he was satisfied that Mr Grant’s ill health also played a part in Mr Hyland’s decision making, whether knowingly or not. As a consequence, Mr Hyland’s evidence about the reasons for termination was considered unreliable.

His Honour also found that whilst the VOPP had dismissed Mr Grant on the grounds of misconduct, it was clear that Mr Grant’s conduct arose wholly out of his medical condition and the VOPP knew of the medical condition. Given that his Honour found that Mr Grant’s illness and misconduct could not be disaggregated, it was held that the VOPP had taken adverse action against Mr Grant because of his mental disability.

The VOPP appealed the first instance decision on the basis that the primary judge erred by finding that Mr Grant’s mental disability was the reason for the termination of his employment.

Decision on appeal

The Full Court identified there was a tension between the primary judge assessing Mr Hyland as an honest witness but then finding that Mr Hyland’s reasons for the dismissal were unreliable. The Court also identified that whilst the primary judge had been very critical of some of Mr Hyland’s evidence, the judge had actually materially misconstrued some of that evidence.

In making its deliberations, the Full Court also applied the two leading High Court authorities regarding adverse action claims, Board of Bendigo Regional Institute of Technical and Further Education v Barclay[2012] HCA 32 (Barclay) and Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd[2014] HCA 41 which affirms the principles enounced in Barclay. The following factors must be considered when considering adverse action claims (at [32]):

  • The central question to be determined is one of fact: It is: ‘why was the adverse action taken?”…
  • The Court is concerned to determine the actual reason or reasons which motivated the decision-maker. The Court is not required to determine whether some proscribed reason had subconsciously influenced the decision-maker. Nor should such an enquiry be made…
  • Even if the decision-maker gives evidence that he or she acted solely for nonproscribed reasons other evidence (including contradictory evidence given by the decision-maker) may render such assertions unreliable.
  • If, however, the decision-maker’s testimony is accepted as reliable it will be capable of discharging the burden imposed on the employer…

On this basis, the Full Court found there was no evidence at odds with Mr Hyland’s stated reasons for terminating Mr Grant’s employment. The Court also found it was possible to have a close association between the prohibited reason and the conduct which gives rise to adverse action, without the adverse action being actuated by the prohibited reason. Whilst Mr Hyland was aware that Mr Grant had been suffering from depression and other ailments at the time the misconduct occurred, the medical evidence did not expressly or impliedly link the misconduct and the illness. Accordingly, the Court found there was no evidentiary basis for the primary judge to conclude that Mr Grant’s illness and misconduct were inextricably linked.

The Full Federal Court allowed the appeal and ordered that the first instance decision be set aside or that the application be dismissed in lieu thereof.

State of Victoria (Office of Public Prosecutions) v Grant [2014] FCAFC 184