Wednesday, 27 March 2019

Court Orders Reinstatement of Executive Sacked after a Battle with HR

It is good practice for employers to ensure that employee complaints are addressed promptly and impartially – and that complainants are not victimised or otherwise adversely treated in the process. A recent case emphasises that getting it wrong can not only result in the award of substantial compensation, but also reinstatement (and backpay) – even years after the dismissal took place.

The Federal Circuit Court has ordered the reinstatement of a long serving executive whose employment was terminated three years prior, after he complained about a HR leader’s difficult behaviour.

In response to his complaint, senior HR executives had failed to support him, instead “putting their heads in the sand” whilst allowing the HR Leader to go “unchecked”. The executive was told by senior HR executives to reflect on his own management style and was placed on a performance improvement plan, to be guided by the very HR Leader he had complained about. His employment was ultimately terminated for ‘performance issues’.

The Court was highly critical of the employer’s response to the executive’s complaint, finding that placing the executive on a performance improvement plan had been akin to chastising him “like an errant school boy”. The Court further noted the deliberateness of the senior HR executives’ adverse conduct and that it had been sustained over a significant period.

The Court ultimately found the employer had taken adverse action against the executive as a result of his complaint, and ordered his reinstatement. This was despite a considerable period of time having elapsed since his dismissal, and notwithstanding that he had long since been replaced. In addition, the employer was ordered to pay almost $1 million in back pay, long service leave, compensation and penalties.

This case highlights the importance for employers and HR managers to act appropriately and impartially upon receipt of employee complaints, and to ensure employees making complaints are not treated adversely because they made the complaint.

Employers should consider seeking advice on the management of complex complaints, particularly where the individuals who would normally manage such complaints are the subject of allegations themselves.

Case Study: Keenan v Cummins South Pacific Pty Ltd (No 2) [2019] FCCA 523 (6 March 2019)

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This article was produced by HR Legal. It is intended to provide general information only in summary format on legal issues. It does not constitute legal advice, and should not be relied on as such.

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