In Australian workplaces, Adverse Action refers to negative actions that may be taken by an employer, an employee, or an independent contractor that can impact an individual’s rights, employment conditions, or working environment. Such actions can be retaliatory, discriminatory, or otherwise harmful and are prohibited by the Fair Work Act 2009. The general protections provisions of the Act are designed to protect individuals from Adverse Action based on prohibited reasons, such as discrimination or retaliation for exercising workplace rights.
Adverse Action is an important concept within Australian employment law, whether initiated by the employer, an employee, or a contractor. Understanding what constitutes adverse Action is essential for both employers and workers, as it directly affects workplace dynamics, general protection claims, and legal obligations.
This article will break down the concept of Adverse Action, explain its implications, and offer guidance on how employees, employers, and contractors can navigate it.
What Constitutes An Adverse Action?
Adverse Action refers to actions taken by an employer, an independent contractor, or another person (e.g., principals in a work relationship) in the workplace that negatively affect an individual’s employment rights or working conditions. These actions are considered unlawful when they are based on specific prohibited reasons in the course of a person’s employment, as outlined in the general protections provisions of the Fair Work Act.
Adverse Action constitutes action taken by an entity or person against another entity or person that is unlawful for particular reasons. Most commonly, Adverse Action is referred to in relation to unlawful action taken by an employer against an employee, however, Adverse Action can also be taken by an employee against an employer, by a prospective employer against a prospective employee and by a Principal against an independent contractor or a proposed independent contractor.
They include:
Termination of Employment or Dismissal
When an employer terminates an employee’s job unfairly or discriminates against them for reasons like their sexual orientation, gender identity, or political opinion.
Reduction in Pay or Hours
For example, if an employer reduces the working hours of an employee due to their involvement in industrial action or their request for parental leave.
Refusal to Offer a Promotion or a Position to an Individual
For example, a potential employee may be denied employment because of their marital status or protected attributes, like race or disability.
Discriminatory Treatment
This includes treating an independent contractor or employee differently from other employees based on protected grounds like age, social origin, or national extraction.
Harassment or Victimisation
Any form of sexual harassment or workplace discrimination that creates a hostile environment.
Undue Influence
Undue influence in Adverse Action claims refers to situations where an employer pressures or manipulates an employee into taking specific actions, leading to unfair treatment or retaliation for exercising workplace rights.
Unjustified Disciplinary Actions
An employer might take Adverse Action against an employee in retaliation for making a complaint or enquiry about workplace issues, such as workplace safety or discriminatory practices.
In any of these cases, the affected individual may file an Adverse Action claim if they believe that the action taken by the employer, independent contractor, or other individuals in the workplace was harmful and unlawful.
Who Is Protected By Adverse Action Laws In Australia?
Provisions of the Fair Work Act 2009 (Cth) (the FW Act) protect people from Adverse Action, by prohibiting Adverse Action from being taken against another person because that person has a workplace right, has or has not exercised a workplace right, proposes or proposes not to exercise a workplace right.
Adverse Action laws in Australia protect employees, prospective employees, and independent contractors from unfair treatment, retaliation, or discrimination by employers, ensuring workplace rights are respected under the Fair Work Act 2009.
Employees
Full-time, part-time, and casual employees are all protected from Adverse Action. The National Employment Standards (NES) ensure that employees’ rights to things like minimum wage, parental leave, and workplace safety are protected from retaliation by an employer. In the case of full-time employees, any unfair dismissal or adverse action that breaches these rights could result in a general protections claim.
Prospective Employees
Potential employees are also protected. If an employer discriminates against a potential employee during the hiring process, such as refusing to offer employment because of the individual’s gender, sexual orientation, or carer’s responsibilities, the individual may have grounds for a general protections claim.
Independent Contractors
Even though independent contractors are not considered employees, they are still protected by the protection of the Fair Work Act. For example, an independent contractor discriminating against another contractor due to their sexual orientation, marital status, or involvement in industrial activities can be grounds for a legal claim.
Casual Employees
Casual employees in Australia are generally entitled to the same protections under the Fair Work Act 2009 as permanent employees, including protection against Adverse Action.
However, casual employees may not have the same rights to unfair dismissal protection if their employment is terminated, as casuals typically have less job security than permanent employees. Despite this, they are still protected from Adverse Action claims based on retaliation or discrimination under the general protections provisions of the Fair Work Act.
Industrial Associations & Unions
Trade unions and industrial associations can play an important role in protecting workers’ rights under industrial law. Industrial law protects employees, prospective employees, and independent contractors from Adverse Actions by employers, particularly in relation to industrial activities like union membership or engaging in industrial action (e.g., strikes or collective bargaining).
Under the Fair Work Act 2009, employees are safeguarded from retaliation such as dismissal, demotion, or other detrimental actions for exercising their workplace rights or participating in lawful industrial action. This legal framework ensures that employers cannot penalise workers for activities like joining a union, negotiating pay or conditions, or raising workplace concerns. If Adverse Action occurs, employees can lodge claims for unfair dismissal or general protections, ensuring their rights are upheld in the workplace.
What Are ‘Prohibited Reasons’ for Adverse Action
Adverse Action is unlawful if it is taken for a prohibited reason (which means it is against the law), which includes, but is not limited to:
Workplace Rights
Actions that affect an employee’s ability to exercise workplace rights—such as requesting flexible working arrangements, taking industrial action, or making a complaint—cannot be the basis for Adverse Action.
Discriminatory Reasons
Employers are prohibited from taking Adverse Action based on a person’s protected attributes, such as gender identity, sexual orientation, race, disability, or political opinion. For example, an employer discriminating against an employee due to their mental disability would be committing unlawful adverse action.
Industrial Activities
An individual cannot be subjected to Adverse Action because they are engaged in industrial activities such as participating in collective bargaining, joining a trade union, or taking part in industrial action.
Workplace Issues
If an employee raises a workplace issue or complaint about workplace safety, sexual harassment, or workplace discrimination, they cannot be subjected to Adverse Action in retaliation.
The Role of the Fair Work Act In Adverse Action Claims
A workplace right can include an entitlement to benefit from a workplace law, such as the entitlement to accrue and take annual and personal leave, and an employee’s right to make a complaint or inquiry in relation to his or her employment.
The Fair Work Act is central to Adverse Action claims in Australia. This Act outlines the general protections provisions that ensure individuals can exercise their workplace rights without fear of retaliation. The Fair Work Commission is responsible for dealing with disputes regarding adverse action claims, and they will assess whether an employer has taken adverse action for a prohibited reason.
Under the Fair Work Act, any employee injuring or discriminating against another employee or independent contractor in the workplace could face legal action. Employers must take reasonable steps to ensure procedural fairness in their decision-making process when dealing with disciplinary actions or workplace disputes.
Provisions of the FW Act also protect people from Adverse Action because of a person’s race, colour, sex, sexual orientation, breastfeeding, gender identity, intersex status, age, physical or mental disability, marital status, family or carer’s responsibilities, subjection to family and domestic violence, pregnancy, religion, political opinion, national extraction or social origin.
Seeking Legal Advice
Employees, employers, and contractors should seek legal advice from employment law specialists when considering filing a general protections claim, or before responding to one. Legal professionals can assist you in understanding workplace law and your rights and responsibilities. After reviewing your matter, they can provide advice on the most appropriate course of action.
Identifying whether Adverse Action has been taken can be a very difficult exercise. It is important to obtain and consider legal advice from an employment law specialist prior to commencing or defending General Protection Proceedings in the FWC, as such advice will likely have a material impact on the outcome of your matter. Stevens and Associates Lawyers has extensive experience with representing both employees and employers with General Protections Proceedings in the FWC, the Federal Circuit and Family Court of Australia and the Federal Court of Australia.
They will also help determine whether the Adverse Action in question was justified or harmful to the employee, and if not, how to proceed with a remedy or legal action in either the Federal Court or Fair Work Commission.
What Is Reasonable Management Action?
Just like employers, employees and contractors must ensure that their actions do not constitute unlawful retaliation or breaches of employment law. Employers are allowed to take reasonable management action in certain circumstances, but this must be done within the framework of the National Employment Standards (NES).
Examples of Adverse Action taken by an employer against an employee include dismissal, injuring an employee in his or her employment, altering the position of an employee to his or her prejudice, and treating an employee less favourably than other employees, or threatening to do so.
Adverse Action does not, however, include action that is authorised under the Act or any other federal or state legislation, such as reasonable management action, including the provision of a disciplinary warning, and genuine redundancy.
Reasonable management action can include providing a disciplinary warning, adjusting an employee’s hours of work, or issuing an employee with a performance review. However, such actions must not be discriminatory or based on a prohibited reason.
If an employer is having issues arise due to an employee or previous employee, addressing them should be guided by legal advice.
They may include:
Disciplinary Action or Issuing Warnings
These actions may be taken if an employee’s actions disrupt the workplace, affect other workers, or violate the employment contract or enterprise agreement.
Termination of Employment or Contract
In cases where an employee or contractor’s actions violate workplace policies or legal requirements, the employer may decide to terminate the employment or contractual relationship.
Claims For Damages
If an employee or contractor’s actions cause financial harm or reputational damage to the employer (such as loss of business due to industrial action), the employer may seek compensation.
For example, an employer may reduce the hours of a full-time employee due to poor performance, but if that action is taken due to the employee’s involvement in industrial action or after taking parental leave, it would likely constitute Adverse Action. Intention is a key factor in adverse action claims.
How Does An Employer Remedy An Adverse Action Claim?
If an employer has taken an action that is deemed an Adverse Action, the affected individual can file a claim for damages or seek to reinstate their position. The general protections laws allow for the following remedies:
- Reinstatement of the employee’s position.
- Compensation for lost wages, damages, or other financial harm caused by the Adverse Action.
- Other entitlements, such as paid leave or parental leave, may also be awarded if the Adverse Action affected the employee’s ability to claim those rights.
Understanding what constitutes Adverse Action in the workplace is essential for both employers and employees. Under the Fair Work Act, individuals are protected from harmful actions that violate their workplace rights, whether these actions are taken by an employer, independent contractor, or even a prospective employee. Employers should be aware of their obligations to ensure they do not take adverse action based on prohibited reasons such as discrimination, industrial action or retaliation for exercising workplace rights.
Lodging An Adverse Action Claim
If an employer has taken Adverse Action against an employee for a prohibited reason, such as in response to that employee having, using or proposing to use a protected workplace right in relation to their employment, or by way of discrimination, then that employee may be eligible to lodge an General Protections Application in relation to a Dismissal, or Non-Dismissal dispute, in the Fair Work Commission (the FWC) under the general protection provisions of the Act.
A General Protections Application in relation to a Dismissal must be lodged in the FWC within 21 days of the date of the Dismissal.
Once lodged by an employee, the FWC sends a copy of the Application to the employer, and organises a conference if the employer does not object to the Application. The conference is held by a Commission Member, or an Independent Conciliator, in an endeavour to resolve the matter, usually within 5 to 10 weeks from the date that the employee lodged his or her Application in the FWC. Many disputes settle in the conference, such as by way of agreed reinstatement or the payment of compensation from the employer to the employee. If the dispute does not settle, the employee may choose to take it further by way of arbitration or court proceedings.
Get In Touch If You Require Advice Or Support Regarding a Workplace Adverse Action Claim
Employees and contractors who feel they have been subjected to Adverse Action should seek legal advice from employment law specialists to better understand their rights and how to proceed with a general protections claim. By doing so, they can ensure that their workplace rights are protected and that they are not subjected to unlawful treatment in the workplace.
We support employees, employers and independent contractors throughout Australia with a wide range of workplace law matters. If you have any questions about this area of law and what it could mean for you or your business, please do not hesitate to contact the office of Stevens and Associates Lawyers.
Get in touch today to speak to one of our knowledgeable lawyers about your matter.
