Major court and tribunal decisions in Australia in 2020

Ramifications for Awards

Due to the pandemic, the Fair Work Commission (Commission) made a determination in early April 2020 to vary 99 Awards (Variation of Awards on the Initiative of the Commission [2020] FWCFB 1837). These changes were in addition to the ‘JobKeeper Amendments’ made to the FW Act on the same day (Coronavirus Economic Response Package (JobKeeper Payments) Amendment Act 2020 (Cth)). The Commission’s determination inserted a temporary ‘Schedule X’, allowing for certain Award-covered staff to take two weeks’ unpaid pandemic leave and annual leave at half pay in certain circumstances — both of which now constitute workplace rights for the purpose of the FW Act s 341, prohibiting employers from taking adverse action in relation to them. These changes provided some much-needed flexibility for many Australian employers grappling with the unprecedented impact of the pandemic on their workforce and were later extended in operation in respect of many of those Awards. The Full Bench of the Commission also made a decision to vary particular Awards, including the Clerks – Private Sector Award 2010, allowing employers in those industries to reduce staff hours and mandate the taking of leave during close down periods (see, eg, Application to Vary the Clerks – Private Sector Award 2010 [2020] FWCFB 5199). Another major Award change included temporary cuts to part-time hours and reduced overtime penalties for 200,000 low-paid fast food workers employed by McDonalds (Application by Australian Industry Group [2020] FWCFB 2316).

The Commission’s Annual Wage Review decision was also reactive to the pandemic when released by the Commission’s Expert Panel in mid-June (Annual Wage Review 2019-20 [2020] FWCFB 3500). From 1 July 2020, the Commonwealth Minimum Wage increased from $19.49 per hour to $19.84 per hour. However, increases in Awards were staged between 1 July 2020 and 1 February 2021, given the financial impacts of the pandemic, with increases across three groupings of Awards, being those industries: (1) less affected by the pandemic, from 1 July; (2) adversely affected by the pandemic, but not to the same extend as others, from 1 November; and (3) most adversely impacted by the pandemic, from 1 February 2021.

Qantas and repercussions of the FW Act’s stand down provisions

The FW Act’s ‘stand down’ provisions — ss 524 and 525 — received substantial attention in judicial decision-making during the pandemic, particularly in respect of Australia’s major airline operator, Qantas. Pandemic-driven bans on non-essential travel and the closure of Australia’s local and international borders led to a significant impact on airlines. In mid-March, Qantas announced that it would stand down around two-thirds of its 30,000 employees (Qantas Group, 2020). Many of those employees sought to rely on accrued leave entitlements as income to supplement later ‘JobKeeper’ (Federal wage subsidy scheme) payments. However, Qantas only permitted them to draw down on accrued annual and long service leave during the stand down, without permitting access to paid personal/carer’s or compassionate leave.

In Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Qantas Airways Limited [2020] FCAFC 205, Rares and Colvin JJ (with Bromberg J dissenting) dismissed two related appeals from a decision of Flick J (Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia & Ors v Qantas Airways Limited [2020] FCA 656). Those appeals were collectively brought by the Transport Workers’ Union (TWU) and the Qantas Engineering Alliance, who argued that Qantas was required to allow its employees, who had been stood down in accordance with s 524, to access paid personal/carer’s and compassionate leave.

The majority concluded that an employee who has been stood down and who seeks to take personal/carer’s or compassionate leave is not ‘authorised to be absent from his or her employment’ for the purpose of s 525(b) (at [87]). The decision also suggested that the FW Act effectively authorises employees to be absent in respect of leave for community service, public holidays, as well as jury service, which would fall within the ambit of s 525(b) (at [120]). The impact of the decision is such that employers must continue to carefully consider their obligations in allowing employees to access various types of paid leave during periods of stand down, including factoring those potential payments into financial forecasting and future workforce planning during existing shutdowns and on return to a ‘new normal’ working environment.

In a separate ruling also involving Qantas, Qantas Airways Ltd v Australian Licensed Aircraft Engineers Association (No 2) [2020] FCA 951, Flick J held that the Commission has the power to arbitrate a dispute between the Australian Licensed Aircraft Engineers’ Association and Qantas and Jetstar concerning pandemic-related stand downs. Qantas had also failed in an earlier challenge to the Commission regarding the Commission’s powers to review how it applied the JobKeeper scheme to a worker, claiming they had been short-changed (Qantas Airways Limited v Mathew Mazzitelli [2020] FWCFB 2628). A rare four-member Full Bench of the Commission found that, among other things, the airline’s characterisation of the dispute was ‘somewhat artificial’ (at [36]).

Qantas also lodged an appeal against a further judgment of Flick J in Qantas Airways Limited v Flight Attendants’ Association of Australia (The JobKeeper Case) [2020] FCA 1365, which required it to backpay employees who received penalty rates in arrears while covered by JobKeeper. At the time of writing, that appeal is still to be heard. The airline also raised its concerns with the Morrison Government about the wider implications of Flick J’s ruling for all Australian businesses (Butler, 2020). In resuming operations after the worst of the pandemic, Qantas made the decision to terminate 8,500 jobs across its corporate group, rejecting a competitive bid by the TWU to save around a quarter of those positions, while outsourcing the same number (Khadem, 2020).

It is now opportune to mention that in the context of adverse action, in early December, Maurice Blackburn instigated a challenge, on behalf of the TWU, to the termination of 2,000 Qantas workers and the outsourcing of their jobs. Taking a similar approach to the 1998 ‘Waterfront dispute’, the TWU sought an injunction against the terminations on the basis of adverse action, with the matter still to be heard at the time of writing. Maurice Blackburn’s Josh Bornstein aptly labelled this case a ‘legal challenge’ to the outsourcing of work (Workplace Express, 2020a).

Responding to shifts in working arrangements

Apart from challenges faced by Australia’s airline industry, many employers needed to consider ways in which to return employees to working different days and hours than before the pandemic, particularly with the sharp increase in employees being directed to work from home (Global Workplace Analytics, 2020). Relevantly, FW Act s 789GV permits an employer to request that an employee who is entitled to JobKeeper payments work at different hours or times than they had worked previously. The employee must consider that request and not unreasonably refuse it.

Section 789GV was tested in TWU of Australia Queensland Branch v Prosegur Australia Pty Ltd [2020] FWC 3139, which involved a claim by the TWU that a greater proportion of hours should have been retained for permanent employees, rather than allocating them to casuals. The TWU also claimed that it was unreasonable to request casual employees to work more hours than they had previously worked when permanent staff were suffering a reduction in work. In response, Sams DP held that Prosegur had the ‘unenviable task to balance equity and fairness for employees with business needs’ (at [37]). He ultimately disagreed with the TWU’s submission that the direction was unreasonable, stating that ‘absent other factors going to an unreasonable request, it will be unreasonable for an employee to refuse a request to increase his or her hours of work compared to their ordinary hours of work’ (at [37]). This decision confirmed that the onus is on the employee to identify the particular reasons to support a submission that an employer’s request that they work different hours or days is unreasonable in order to refuse it. There is no unreasonableness in an employer requesting that an employee increase their work hours as compared to their ordinary hours, that a casual employee work a minimum number of hours or that a casual employee be allocated hours in favour of a permanent employee.

Of further significance in the context of the pandemic was the impact of new working arrangements, especially in the context of travel restrictions. In Knight v One Key Resources (Mining) Pty Ltd t/a One Key Resources [2020] FWC 3324, the Commission was asked to consider a conflict between an employee’s privacy in respect of their personal travel activities and their employer’s work health and safety obligations. In dismissing an application for unfair dismissal by an employee who was dismissed for refusing to complete his employer’s internal work health and safety survey regarding recent overseas travel, Simpson C found that the survey request was lawful and reasonable, particularly in light of the employer’s work health and safety obligations, as well as State and Federal Government guidelines regarding the pandemic. The information requested did not constitute ‘sensitive personal information’ for the purposes of the Privacy Act 1988 (Cth) (at [83]). Consequently, the employee’s refusal to comply with the travel survey direction amounted to a valid reason for his dismissal. At this point, it is worth mentioning that in the unfair dismissal jurisdiction, the Commission saw a substantial rise in the number of applications — so much so that it prompted the Commission’s president to raise the matter directly with Commonwealth Government (Workplace Express, 2020b).

Clarifying the calculation of personal/carer’s leave under the NES

In Mondelez Australia Pty Ltd v Australian Manufacturing Workers Union [2020] HCA 29 (Mondelez), the High Court clarified how personal/carer’s leave may be calculated. In this much-anticipated decision, the High Court held that a ‘day’ of personal/carer’s leave under the NES is an average day of the worker, not the specific day of absence. That calculation is to be based on an employee’s ordinary hours of work, with 10 days’ paid personal/carer’s leave to be calculated as 1/26 of an employee’s ordinary hours of work in a year. Many viewed this interpretation as ‘common sense prevailing’, in that numerous payroll systems already provided for personal/carer’s leave to accrue in such a way, therefore avoiding disruptions to those systems across the country (Feltham et al, 2020). The decision altered a Federal Court finding that measured personal/carer’s leave in days, rather than hours, causing calculation difficulties for employers (Mondelez Australia Pty Ltd v Australian Manufacturing Workers Union [2019] FCAFC 138). It was on this basis that the Commonwealth Attorney-General intervened in the High Court appeal.

Mondelez concerned the calculation of leave entitlements of two full-time shift workers employed by Mondelez at its Cadbury chocolate plant at Claremont in Tasmania. These employees, among others, worked non-standard hours comprising (on average) three shifts of 12 ordinary hours per week, totalling 36 ordinary hours per week. The High Court needed to clarify whether the reference to ‘10 days’ under FW Act s 96(1) gave an entitlement for non-casual employees to 10 ‘standard days’ of paid personal/carer’s leave per year (ie, 10 days of 7.2 hours based on a standard 26-hour week) (‘Notional Day Construction’, proposed by the appellant employer, Mondelez), or 10 ‘working days’ (ie, 12-hour days) of paid personal/carer's leave per year (‘Working Day Construction’, proposed by the respondent union).

A High Court majority (comprising Kiefel CJ, Nettle and Gordon JJ, with Edelman J agreeing, and Gageler J dissenting) overturned the Full Federal Court’s judgment, accepting the Notional Day Construction. Their Honours clarified that ‘a “day” is a notional 7.2 hours' (ie, ‘10 days’ equates to 72 hours’, or two weeks’, paid personal/carer’s leave per year for full-time employees). It rejected a more generous construction proposed by the Australian Manufacturing Workers’ Union. The reasoning behind that construction included it being consistent with the legislative purpose of the FW Act, extrinsic materials and legislative history, along with the purpose of s 96 being to protect against an employee’s loss of earnings by reference to an employee’s ordinary hours of work (at [50]–[73]). The outcome was that the amount of leave accrued does not vary according to any pattern in which those hours are worked. Moreover, the High Court recognised that a shift worker with compressed hours of work and fewer days of work would be less likely to fall ill and/or need to provide care on a workday. That said, when a shift worker must do so, they will need to take more hours of leave on that particular day of work. A shift worker with the same ordinary hours of work will therefore generally require fewer days of leave, but still require the same number of hours of leave, so as to ensure the same ‘safety net’ of protection afforded to day workers (at [94]).

As suggested, this decision restored a traditional approach to leave accrual calculations. It also ensured a notion of fairness between workers employed on different rosters and shift structures, confirming that non-casual employees accrue personal/carer’s leave in accordance with their ordinary hours of work. It further functioned as a timely reminder that when applying the FW Act, it is important to take a common-sense approach, in order to avoid any impracticalities, unfairness or unintended consequences.

Entitlements for low-paid and precariously employed workers

We have also now received further clarity from the Full Court of the Federal Court regarding casual employment in WorkPac Pty Ltd v Rossato [2020] FCAFC 84 (Rossato) — a landmark decision regarding the payment of leave entitlements of workers who have been labelled and paid by their employer as ‘casuals’. The impact of this decision has been to put a stop to a widely held belief that mere payment of a casual loading was enough to justify the non-recognition of leave entitlements. The Full Court confirmed that a casual employee does not have a ‘firm advance commitment’ regarding the duration of their employment or the days they will work.

In Rossato, the Full Court reinforced its earlier decision in WorkPac Pty Ltd v Skene [2018] FCAFC 131 (Skene) — helpfully summarised in the 2018 review (Landau and Allen, 2019: 422--5). Just like that earlier decision, the Full Court identified that WorkPac had incorrectly classified an employee as a ‘casual’. It found that an employee will be likely to have a ‘firm advance commitment’ to ongoing employment if -- based on an objective assessment of the facts (not just the employee’s written contract) at the time the employment commenced --- there is a mutual commitment between the employee and employer to a continuing and indefinite working arrangement (at [50]). There must also be an agreed pattern of work, even if only on a fixed-term basis for a significant period of time (at [31]). Employees who find themselves in that situation will then be entitled to the same paid leave entitlements as non-casuals. Importantly, there will be a significant curtailment of circumstances where an employer can permissibly offset a casual loading paid to a casual employee against a claim by the employee for paid leave entitlements.

Following the decision in Skene, Mr Rossato wrote to WorkPac claiming that he was also not a casual and that he had entitlements under the NES, as well as WorkPac’s enterprise agreement, including entitlements to annual leave, personal/carer’s leave, compassionate leave and public holidays. In response, WorkPac commenced Federal Court proceedings, seeking declarations that Mr Rossato was a casual, or alternatively that it was permitted to apply the 25% casual loading that it had paid him by way of satisfaction of those entitlements pursuant to common law principles regarding set-off and Fair Work Regulations 2009 (Cth) (Regulations) reg 2.03A. As a further alternative, WorkPac sought a declaration that it was entitled to restitution of the extra money it had paid to Mr Rossato due to his status as a casual.

In the normal course of things, this matter would have been allocated to a single judge of the Federal Court. However, given its significance, it was allocated to a Full Court. In finding that Mr Rossato was not a casual, the Full Court applied the test from Skene as to whether there was a ‘firm advance commitment’ as to the duration of the employer’s employment. In finding that such an advance commitment did exist, some of the many factors that the court took into account were that Mr Rossato had agreed to ongoing employment with WorkPac, worked shifts with advanced notice of his rosters which were fixed, worked on a drive-in-drive-out basis and was accommodated at his place of work and had very limited time off work (at [142]).

WorkPac’s set-off argument failed both at common law and under the Regulations, with the Full Court finding that there was no ‘close correlation’ between the payment of a casual loading and the purported entitlements that would allow for a set-off at common law (at [225] and [904]). Furthermore, reg 2.03A had no application in this case because a component of it under reg 20.03A(1)(d) was not satisfied. That sub-regulation requires that a ‘person makes a claim to be paid an amount in lieu of one or more of the relevant NES entitlements’. Mr Rossato’s claims were not claims in lieu, but rather, claims for entitlements under the NES that he was owed; simply put, Mr Rossato had made a claim for personal/carer’s leave that he had actually taken. WorkPac’s argument regarding restitution also failed because the Full Court did not find that a separate portion of Mr Rossato’s wage had been paid, either due to a mistake or in reliance on Mr Rossato actually being a casual, not permanent, employee (at [12], [264]–[265] and [817]). Failing any express term in Mr Rossato’s employment contract regarding such a set-off, WorkPac would have otherwise needed to show that such a mistake was so grave that it would have gone to the root of the contract, resulting in it being void.

The fallout of this decision has been to place employers at heightened risk in the event that they misclassify a casual employee. Employers must be careful when classifying their employees as casuals, even if that is what is stated in an employment contract. They must look beyond the classification given in the contract and query whether there is a firm advance commitment by both parties to a continuous and indefinite pattern of work. If so, the employee will not actually be a ‘casual’ and employers must ensure they account for relevant leave entitlements or risk being found in breach of the FW Act’s civil penalty provisions.

In reinforcing the Skene ruling, Rossato drew attention to the status of apparently ‘casual’ employment contracts, so much so that the recent Full Bench decision of Greene v Floreat Hotel [2020] FWCFB 6019 appears to have the effect of expanding the unfair dismissal jurisdiction of the FW Act for casual employees. Furthermore, the Commonwealth Attorney-General and Minister for Industrial Relations have signalled a proposal to introduce a new definition of a ‘casual’ into the FW Act (Fair Work Amendment (Supporting Australia’s Jobs and Economic Recovery) Bill 2020 (Cth)). Union-backed class actions relating to this issue have been mounting since 2019. They are currently being waged against BHP’s Mount Arthur Coal and labour-hire providers, Tesa Mining and Chandler Macleod (Landau and Allen, 2019: 452). Immediately following the Rossato decision, the Construction Forestry Maritime Mining and Energy Union (CFMMEU) filed a class action claim against Workpac in the Federal Court (Workplace Express, 2020c). The outcome of each of these proceedings will likely be contingent upon the High Court's decision on appeal.

In Retail and Fast Food Workers Union Incorporated v Tantex Holdings Pty Ltd [2020] FCA 1258, another important decision was made, which clarified the scope of what constitutes a ‘workplace right’ for the purpose of the FW Act’s general protections provisions, potentially impacting a vast array of workers in precarious positions across the country. Justice Kerr found that the right to take a short drink or toilet break outside of scheduled breaks constitutes a ‘workplace right’, and that a McDonald's franchise (through its general manager) coercively and recklessly misrepresented this right over a Facebook post, constituting adverse action in contravention of the FW Act. The decision emphasises that employers must be alert to the fact that employees have a workplace right to take bathroom breaks or have a drink of water, even outside of scheduled break times, consistent with an employer’s duty to ensure, so far as is reasonably practicable, the health and safety of its workers. Employers must also take care not to misrepresent or deny an employee’s access to workplace rights, particularly where such denial or misrepresentation could, as a matter of ordinary life experience, have adverse health and safety impacts.

Finally, in the context of general protections, it should be noted that in Coles Supply Chain Pty Ltd v Milford [2020] FCAFC 152, the Full Federal Court held that the Full Bench of Commission misconstrued its jurisdiction when finding that it was not authorised to make a finding as to whether or not an applicant had been dismissed from their employment. Prior to this decision, it had been held on several occasions that such a jurisdictional issue was unable to be considered until it reached the next stage in the Federal Circuit or Federal Court. Australia also saw a landmark award of $5.2 million in damages (plus interest) in the context of a successful general protections claim and for breach of contract, in relation to the payment of incentives (Roohizadegan v TechnologyOne Limited (No 2) [2020] FCA 1407 — a case involving a senior employee, rather than a low-paid worker).

Academics in the spotlight

As suggested, academics gathered notoriety in the context of dismissals, three instances of which are mentioned here. This focus builds on last year’s review where there was a focus on the question of academic freedom in the context of academic employment (Allen and Landau, 2020: 449–50). In the first matter, Zhao v University of Technology Sydney [2020] FWC 416, the Commission ordered the reinstatement of a University of Technology Sydney Business School lecturer who had failed to meet a requirement to have research published in a top journal but had still achieved other benchmarks.

Deputy President Sams found that the lecturer’s dismissal for unsatisfactory performance was both harsh and unreasonable. The university dismissed the lecturer after 14 years’ service, due to the fact that she had failed to meet requirements set out in a 2018 performance improvement plan to have two research papers published in A*- or A-ranked peer-reviewed journals by the end of that year. The lecturer had submitted two papers to highly ranked journals, but which had low acceptance rates of just 13% and 14%, and which could also take up to 21 months to make a decision on publication. One of the journals had even communicated to the lecturer that her paper was ‘well written’ and contained analysis that ‘could not be faulted’, yet needed the authors to ‘dig deeper’ in some areas. Notwithstanding these considerations, the lecturer’s supervisor refused to grant her an extension to re-work and submit the papers. Instead, her supervisor recommended that the university dismiss her for unsatisfactory research performance. Finding that the university did not have a valid reason for dismissal, Sams DP was satisfied that the dismissal was harsh, unjust and unreasonable, ordering that she be reinstated with back pay. Deputy President Sams noted that there was no ‘evidence that she was anything but a dedicated, hard-working team player who had good and positive relationships with her supervisors and colleagues’ (at [128]). This decision sent a resounding message to universities concerning the need to set careful publication benchmarks for academic staff within appropriate and reasonably achievable limits.

A later Full Federal Court decision, James Cook University v Ridd [2020] FCAFC 123 (Ridd), concerned an academic from James Cook University who was dismissed after criticising research relating to climate change. The Full Court upheld James Cook University’s appeal against a Federal Circuit Court decision, helpfully summarised in the 2019 review (Allen and Landau, 2020: 449–50), that its code of conduct could only apply where academics’ behaviour was not covered by intellectual freedom clauses in its 2013 enterprise agreement. Judge Vasta of the Federal Circuit Court had ordered the university to pay Professor Ridd over $1.2 million, stating that it had dismissed a long-standing and productive employee for exercising a workplace right. However, the Full Federal Court jointly held that the case centred on whether the 2013 enterprise agreement gave the professor an ‘untrammelled right (provided his conduct did not harass, vilify, bully or intimidate) to express his professional opinions in whatever manner he chose, unconstrained by the behavioural standards imposed by the code of conduct’. In finding that the 2013 enterprise agreement ‘did not’, the Full Court held that the university’s dismissal of Professor Ridd for breaches of its code of conduct did not contravene FW Act s 50 — a provision prohibiting contraventions of an enterprise agreement.

Just months after the Full Court’s decision in Ridd, the notion of academic freedom received further attention in National Tertiary Education Industry Union v University of Sydney [2020] FCA 1709. Justice Thawley found that the intellectual freedom clause in the University of Sydney’s enterprise agreement relied upon by human rights lecturer, Dr Tim Anderson, was not enforceable. His Honour found that the lecturer’s actions in superimposing a swastika on an Israeli flag in teaching materials during a lecture about ‘reading through propaganda’ storms and in social media posts, as well as publishing tweets claiming the ‘Murdoch press fabricates “genocide threat”’ story in an attempt to intimidate anti-war academics’ and ‘Colonial media resorts to almost any sort of personal attack to intimidate dissent from the official war line’ were ‘deliberately provocative’ (at [255]). According to the court, Dr Anderson’s actions were ‘not a genuine exercise of intellectual freedom, as referred to … [in] the 2018 agreement’ (at [256]). As a consequence of this latest decision, as well as that in Ridd, the National Tertiary Education Union has now commenced lobbying vice chancellors around Australia to generate a legally enforceable right to academic freedom within their respective enterprise agreements as a means to bolster the protections of academic freedom (Workplace Express, 2020d).

A triumph for the ‘Aussie larrikin’

Beyond academia, in what may be touted as a ‘victory for the Aussie larrikin’ (Workplace Express, 2020e), a Full Federal Court overturned the dismissal of a BP Refinery technician after he privately shared a version of a Hitler parody video during enterprise agreement negotiations (BP Refinery (Kwinana) Pty Ltd v Tracey [2020] FCAFC 89). Mr Tracey was summarily dismissed in January 2019 after posting the video titled ‘Hitler Parody EA Negotiations’ to an employee-only Facebook group. The video was based on the 2004 German film ‘Downfall’, which portrays Hitler in his final days of life. It was edited to mirror enterprise bargaining negotiations between bargaining representatives and the BP Refinery’s senior management. Following the Full Court’s decision, a Full Bench of the Commission later ordered that BP Refinery must pay over $200,000 compensation to the reinstated worker, while also allowing it to reduce his bonus and revoke a promotion (Tracey v BP Refinery (Kwinana) Pty Ltd [2020] FWCFB 4206).