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Workplace Relations Update July 2008 |
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| Focus: |
Workplace Relations news |
| Services: |
Commercial |
| Date: |
31 July 2008 |
| Author: |
National Workplace Relations Team |
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Dibbs Abbott Stillman Lawyers restructured on 1 March, 2009.
The Sydney, Brisbane and Canberra offices are now DibbsBarker.
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Get thee to a psychiatrist – can an employer require an employee to undertake a psychiatric assessment?
In short, yes, as a recent decision of the Federal Court of Australia has found. The decision provides some useful guidance to employers who are seeking to balance their obligations under occupational health and safety legislation with their obligations not to engage in unlawful disability discrimination.
The facts
The matter came before the Court as an application by one Mr Thompson for an order that his employer, IGT (Australia) Pty Ltd (“IGT”), withdraw its direction to him that he attend a psychiatric assessment. He also sought orders that his employer be ordered not to make any further directions concerning psychiatric assessments, and that it be ordered not to discipline him for his failure to attend psychiatric assessments.
The evidence indicated that Mr Thompson had a history of back pain which predated his employment with IGT (which commenced in 2001). During the period of his employment, he had a very considerable number of absences from work, including absences for the purpose of surgery. However, from about May 2007, IGT began to have concerns about Mr Thompson’s ongoing condition and about how the condition related to Mr Thompson’s ability to perform his work. It appears that from about this time, IGT also become concerned about the level of Mr Thompson’s absences from work, which it regarded as excessive.
IGT arranged for appointments with a general surgeon in November 2007 and with a psychiatrist in December 2007. Mr Thompson kept the appointment with the general surgeon but not the appointment with the psychiatrist. During December 2007 and through 2008, Mr Thompson was absent from work on a number of occasions on which he provided either no medical explanation, or no medical explanation other than “medical condition”.
In May 2008, IGT again wrote to Mr Thompson directing him to attend a further psychiatric assessment which IGT had arranged. The letter was quite detailed and made plain that IGT was to pay for the cost of the assessment, as well as any out-of-pocket costs which Mr Thompson incurred, and that Mr Thompson would be paid as if he was at work during the period of the assessment. The letter also emphasised IGT’s view that Mr Thompson was required to comply with lawful and reasonable directions, and that IGT considered that the direction to attend the assessment was both lawful and reasonable. Finally, the letter referred to Mr Thompson’s previous failure to comply with lawful and reasonable directions and indicated that disciplinary action might occur if Mr Thompson did not attend the appointment which IGT had arranged.
The response to the letter, it appears, was that Mr Thompson commenced court proceedings.
Mr Thompson’s argument
Mr Thompson argued that the imposition of the requirement that he attend a psychiatric assessment was unlawful discrimination against him on the basis of his disability. He argued that the psychiatric assessment had nothing to do with his absences from work in late 2007 and 2008 which were, he said, related to his back injury. He also argued that the requirement that he attend a psychiatric assessment involved the imposition of a “detriment” within the meaning of anti-discrimination legislation.
What the Court found
Justice Goldberg noted the discrepancy between the explanation for the absences given by Mr Thompson at the hearing, and Mr Thompson’s failure to give any explanation to IGT at the time that the absences occurred (or to give no explanation more helpful than “medical condition”.)
In that circumstance, Justice Goldberg was of the view that it was not unreasonable for IGT to require a psychiatric assessment, and that the question of whether a psychiatric assessment was relevant to Mr Thompson’s absences from work was a matter for doctors, and not a matter which Mr Thompson could determine, especially in light of Mr Thompson’s failure to provide timely advice to IGT of the reasons for his absences. The failure to give a timely explanation meant that Justice Goldberg could not conclude that all of Mr Thompson’s absences in late 2007 and 2008 were related to Mr Thompson’s back injury, and thus could not conclude that the psychiatric assessment was unrelated to the absences.
Turning to the question of whether or not Mr Thompson was subject to a detriment, Justice Goldberg considered the requirements of the Occupational Health and Safety Act 2004 (Vic) (the relevant provisions of which are, in general terms, mirrored in occupational health and safety legislation throughout Australia). In the context of the employer’s duty to ensure the health and safety of employees, Justice Goldberg held that requiring an employee to provide medical information relevant to that duty could not amount to a detriment (and to the contrary, that a request by an employer to provide such information will often be a necessary part of employment).
Finally, Justice Goldberg dealt with the argument of whether Mr Thompson had been subject to less favourable treatment “because of” his disability. Justice Goldberg held that IGT’s requirement that Mr Thompson attend a psychiatric assessment had not been imposed because Mr Thompson had a disability, but rather, to enable IGT:
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to find an explanation for Mr Thompson’s absences; and
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to comply with IGT’s obligations under occupational health and safety legislation; and
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to ascertain the extent to which Mr Thompson could fulfil the inherent requirements of his position.
It followed that Mr Thompson’s claim for orders restraining IGT was dismissed with costs.
Lessons for employers
This decision certainly should not be read as an invitation to send all of your employees off to see a psychiatrist! However, it does emphasise some important points about dealing with injured employees:
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The process of managing an injured employee is one in which both employer and employee are required to co-operate. The employee’s co-operation is needed to ensure that the employer has access to the necessary medical information, and in appropriate circumstances, this can extend to requiring the employee to attend appointments and to disclose information to the employer;
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Employers should always have up-to-date medical information before making decisions about an injured employee. A theme that flows through many of the unfair dismissal and discrimination cases in which employers have lost is that the employer made decisions based on assumptions about the employee’s ability to perform work, rather than making decisions based on medical evidence;
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Although it is common for medical certificates to disclose no more detail than “medical condition” (sometimes, it is said, for privacy reasons) an employer may reasonably require the employee to provide further information to enable the employer to meet the employer’s occupational health and safety obligations. If the employee does not provide reasonable information, it may be difficult for the employee to later complain that an employer’s action was unreasonable.
Abandon employment, all ye who enter here (or not)
A recent decision of the Full Bench of the Australian Industrial Relations Commission (“AIRC”) has emphasised the care that needs to be taken before an employer decides to treat an employee as having abandoned their employment. The case is also a useful reminder that reinstatement is the primary remedy when a dismissal is found to be unfair, and that reinstatement with back pay may cost the employer a great deal more than the cap on monetary compensation of six (6) months’ pay.
The facts
The employee, Mr Gauci, was employed by GlaxoSmithKline Australia Pty Ltd (“GSK”) in August 1998. In May 2007, he applied for a different role within GSK and was unsuccessful. The communication of this lack of success to Mr Gauci appears to have resulted in acrimonious exchanges between Mr Gauci and both Ms Fanous (GSK’s HR Officer) and Mr Llewellyn (GSK’s HR Manager). Mr Llewellyn gave Mr Gauci a formal warning on 4 June 2007 and Mr Gauci notified a grievance to his union.
On 6 June 2007, Mr Gauci left a telephone message for his supervisor to advise that Mr Gauci would not be at work on 7 June 2007 as he was taking carer’s leave. Mr Gauci was also absent on 8 June 2007 (again, having left a message on the previous day).
On 10 June 2007 (a Sunday), Mr Gauci left a further telephone message for his supervisor, which was retrieved on 12 June 2007 (11 June 2007 being a public holiday). The terms of this telephone message were in dispute, but it seems to have been common that Mr Gauci advised GSK that if the grievance with Mr Llewellyn was not resolved, Mr Gauci wished to resign. Later on 12 June 2007, Ms Fanous telephoned Mr Gauci and advised him that if he wished to resign, he would need to put that resignation in writing and to give five (5) weeks’ notice. Ms Fanous was not available on 13 or 14 June 2007, and so made an appointment with Mr Gauci on 15 June 2007 for the purpose of the resignation being effected. However, Mr Gauci did not attend the meeting and did not answer his mobile telephone when called by Ms Fanous.
As a result, on the afternoon of 15 June 2007, Ms Fanous wrote to Mr Gauci advising him that his employment had been terminated in accordance with the “Abandonment” provision in GSK’s enterprise agreement. That clause provided that where an employee was absent for a continuous period exceeding three (3) working days “without the consent of the employer and without notification to management” such an absence would be “prima facie evidence” of abandonment of employment.
Mr Gauci brought a claim alleging that the termination of his employment was unfair. At first instance, it was found that Mr Gauci had not resigned, and that the “Abandonment” provision of GSK’s enterprise agreement did not apply. It followed that there was no valid reason for the termination of Mr Gauci’s employment and the termination was thus unfair. Subsequently, GSK was ordered to reinstate Mr Gauci with back pay (but subtracting from the amount of back pay any amount which Mr Gauci had earned in the intervening period). GSK appealed against both the finding that the dismissal was unfair and against the order for reinstatement.
Issues on appeal – had Mr Gauci resigned?
In general terms, there is no formal requirement that a resignation be in writing (although it is, of course, desirable that resignation be given in writing). In the absence of a specific requirement, an employer may accept a resignation given orally and that will bring the contract to an end.
However, if there is a specific requirement that a contract of employment be terminated by notice in writing, then oral notice will not suffice. In the present case, Ms Fanous had made it clear to Mr Gauci that his resignation would only be accepted in writing. It followed that even if the dispute about the terms of the conversation of 12 June 2007 was resolved in the manner most favourable to GSK, it was not open to GSK to argue that Mr Gauci had resigned during the course of that conversation. The most that could be said was that he had expressed an intention to resign, which was not sufficient to prevent Mr Gauci bringing a claim for unfair dismissal.
Issues on appeal – had Mr Gauci abandoned his employment?
The Full Bench agreed that the “Abandonment” provision of GSK’s enterprise agreement did not apply. The first difficulty for GSK was that it could not point to three consecutive days on which Mr Gauci was absent from employment without either “the consent of the employer” or “notification to management”. GSK could not rely on Mr Gauci’s absences on 13, 14 and 15 June 2007, because the absences on 13 and 14 June 2007 were by agreement, pending the meeting scheduled on 15 June 2007 and thus there was either consent, or notification, in respect of those absences.
The Full Bench also noted that in any event, a continuous absence of three days provides only “prima facie” evidence of abandonment. A prima facie case can always be rebutted by evidence, and in the present case, the Full Bench held that the evidence as to the arrangements made for Mr Gauci to meet Ms Fanous to effect his resignation rebutted any suggestion of abandonment.
Finally, the Full Bench noted that even if GSK was entitled to rely upon the “Abandonment” provision of the enterprise agreement, Mr Gauci would still have been entitled to bring an unfair dismissal claim, because the termination would still have been at GSK’s initiative. The Full Bench reasoned that where an employer brings a contract of employment to an end by accepting repudiatory conduct in the part of the employee (such as abandonment of employment) then the termination is still at the initiative of the employer. At first blush, this finding does not seem to be consistent with decided cases in which the employee has accepted the employer’s repudiatory conduct, because termination has, in those cases, been held to be at the initiative of the employer. However, it is unnecessary to explore this issue in detail; it suffices to say that it adds another level of complexity to cases of this kind.
Issues on appeal – should Mr Gauci be reinstated?
GSK argued that Mr Gauci should not have been reinstated because there was evidence that the relationship between the parties had broken down. At first instance, it was accepted that the relationship between Mr Gauci and Mr Llewellyn was “less than ideal”, but reinstatement was ordered on the basis that it was incumbent upon both Mr Gauci and Mr Llewellyn to “adjust their attitudes to one another”, and also on the basis that Mr Gauci and Mr Llewellyn would not need to come into regular contact with one another. The Full Bench found that there was no error in the order of reinstatement in these circumstances.
GSK also argued that Mr Gauci should not have been reinstated in circumstances where he had resigned. In light of the previous finding that Mr Gauci had not resigned, this ground of appeal was also rejected.
Lessons for employers
This case indicates the difficulties that can be encountered when bringing employment to an end on the ground of abandonment, and provides the following lessons (in addition, of course to the lesson that it is always useful to obtain specialist advice!):
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Whether an employee has abandoned their employment is a question of fact, and it will be necessary to consider all of the facts in a particular case, rather than simply relying on the form of words in a contract or enterprise agreement;
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In most cases, it will be useful to advise an employee, in a manner likely to come to the employee’s notice, that they are at risk of abandonment prior to taking any decision;
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When there is doubt about whether an employee has resigned, the employer will need to consider what requirements the employer imposes in order for a resignation to be effective. Once an employer imposes requirements, the employer must observe those requirements; and
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Paying six months’ pay is not always the “worst-case scenario” if an employer loses an unfair dismissal case – reinstatement is the primary remedy and, particularly where the employer is large, the fact that the employee has been in dispute with some of the employer’s management will not preclude an order for reinstatement.
If you would like more information, please contact a member of our Financial Services Team listed on the right hand side of the screen.
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Author: National Workplace Relations Team
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