An external HR consultant and a supervisor have been found accessorily liable for contraventions of the Fair Work Act 2009 (Cth) (FW Act) after they were involved in the dismissal of an employee who raised a potential award non-compliance issue (Myers v Arenco Holdings Pty Ltd & Ors [2019] FCCA 3077).
The employee was a yoga instructor at a studio where her duties included administrative tasks as well as teaching yoga classes. The employee had been in her position for three months when her employment was terminated.
The employee claimed that she was dismissed because she suggested to her supervisor that she was not being paid in accordance with the Fitness Industry Award 2010 (the Award). The employee gave evidence to the court that, shortly before her dismissal, she had participated in a meeting with the yoga studio’s coordinator (who was her supervisor) and the consultant about her hours of work, specifically in relation to managing her part-time hours and her responsibilities as a parent. The employee claimed that the outcome of the meeting was a plan for her to develop an ideal roster for hours that would meet everyone’s needs.
The employee said that in preparing the proposed roster, she referred to the Award and felt that there were certain provisions relating to overtime and broken shifts that were likely not being adhered to by her employer. She texted her supervisor, alerting her to this potential award non-compliance issue.
The next day, the employee attended the yoga studio where she had a conversation with her supervisor. The employee alleged that during their conversation, the supervisor dismissed the employee and proposed re-engaging her as a contractor.
The next day, the employee emailed the consultant about the matter, requesting clarification and further information about the proposal of a contractor arrangement.
The consultant responded confirming that the employee’s employment was terminated, and that she would forward proposed terms of a new arrangement in a separate email.
Shortly after, the employee commenced proceedings against her employer, the supervisor and the consultant claiming that adverse action was unlawfully taken against her because she made a complaint/enquiry about her employment.
In response to the employee’s contentions, the employer, the supervisor and the consultant argued that the employee was not dismissed because she raised potential award non-compliance but because of ongoing poor performance.
The supervisor and the consultant claimed that, from almost the beginning of her employment, the employee had not performed her administrative duties to the standard expected of her. They argued that the supervisor had raised performance issues with the employee in the past and the employee had failed to improve.
However, there was no evidence to support the assertions of substandard performance. In fact, there the employee was able to produce evidence to the contrary including a number of text messages from the supervisor to the employee praising her performance. In those text messages, the supervisor said:
The court rejected the argument that the employee had been dismissed for performance reasons, noting that there was no evidence of any kind to support such a finding.
The court found that,
the termination of [the employee’s] employment was adverse action taken against [the employee] because she sent, at 10.17 am, the 3 July 2018 text message to [the supervisor] asserting the Fitness Industry Award had not been complied with. That was a prohibited reason for the taking of adverse action against [the employee]. The respondents have not proven otherwise. [at 37]
The court also found that the decision to dismiss the employee was made by the consultant in consultation with the supervisor and they were both, therefore, involved in committing adverse action against the employee in contravention of the FW Act. The court said,
Together, [the supervisor] and [the consultant] were each ‘involved in’ the said contravention and are accordingly accessorily liable for such contravention pursuant to the provisions of s. 550(1) of the FWA. The Court finds that each of [the supervisor] and [the consultant] sought to portray the termination of [the employee’s] employment as based on work performance issues, when in fact it was due to [the employee] pointing out that she had been underpaid, and that the Fitness Industry Award had not been followed. They were motivated by a desire to avoid the financial consequences which would be suffered by the first respondent if it was required to pay to [the employee] her due entitlements. [at 47]
The court found that the employer, the consultant and the supervisor were all liable for contraventions of the FW Act and would be ordered to pay penalties (to be determined). The court also found that the employee was entitled to compensation for hurt and distress as well as financial loss (also to be determined).
Lesson for employers and others
Under s550 of the FW Act, individuals can be found accessorily liable for contraventions of the FW Act if they are “involved in” those contraventions.
In this case, the individuals named as persons “involved in” the contravention included a supervisor (not a manager) and a HR consultant, who was not an employee but acted on behalf of the employer.
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