Tuesday, January 14, 2014

Bully law a case of IR overload

It took less than a week for the first anti-bullying application to be lodged.  A Melbourne-based law firm is already advertising for anti-bullying clients.  These are sure signs that Australia's litigious industrial relations system is about to get worse.

On January 1, a new anti-bullying jurisdiction came into operation that will see applications to the Fair Work Commission increase exponentially.  Among other changes, the new Part 6-4B of the Fair Work Act empowers the commission to deal with complaints about workplace bullying and issue anti-bullying orders.

Last year, Bernadette O'Neill, the commission's general manager, estimated that the body would receive 3500 bullying complaints each year, increasing the commission's workload by almost 10 per cent.

There are three main problems with the anti-bullying changes.  First, the new laws are vague on what conduct will constitute bullying and how far the provisions will extend.

The act provides that ''bullying at work'' occurs where an ''individual'', or a ''group of individuals'', ''repeatedly behave unreasonably'' towards a worker and the ''behaviour creates a risk to health and safety''.

It is unclear what ''behave unreasonably'' means.

This ambiguity invites litigation.  Parties will invariably disagree about whether the behaviour was unreasonable, and it will fall on the commission to decide on a case-by-case basis.

This is particularly so when courts have held bullying to include things such as spreading rumours and playing practical jokes.

It is also unclear how far the term ''individual'' will extend.  The term is so broad that it appears to include anyone that a worker encounters on the job.

In this case, the commission could order a customer of a business to stop bullying a worker, and it could order the employer to monitor that customer's behaviour.

The number of expected applications is likely to be a conservative estimate given that the changes expand the number of people who are able to apply to the commission.

Applications are not simply limited to employees.  The inclusion of trainees, contractors, work experience students and even volunteers under the definition of ''worker'' will no doubt add to the surge of new claims.

The second major problem is that the absence of cost incentives presents a further risk of a blowout in the number of estimated applications.

The costs of the new system will fall on employers and the taxpayer.

Application fees to the commission are low and parties generally pay their own legal costs.  The new anti-bullying jurisdiction is no different.  While this combination arguably increases access to justice, it also fosters a ''litigate first'' mentality and removes parties' incentives to only advance meritorious claims and defences.

The saving grace of the anti-bullying jurisdiction is that there is no ''pot of gold'' for applicants to chase, as the commission cannot award monetary damages.

However, applicants may be able to seek compensation by bringing multiple claims.  For instance, a worker who alleges racially motivated bullying may decide to bring an application for an anti-bullying order in conjunction with a general protections claim.

There is a genuine concern that disgruntled and underperforming employees may exploit the new provisions to subvert legitimate performance management and disciplinary action.

Under this scenario, countless employers and managers will be forced along to the commission to justify that their management actions were reasonable.

Every application will cost employers countless hours and thousands of dollars to defend — time and money that employers could use actually employing people to produce goods and services.

Taxpayers will also bear the cost of the new anti-bullying jurisdiction.  In the 2013-14 budget, the commission was allocated $24.4 million over four years to deal with workplace bullying matters.

The third major problem is that the anti-bullying changes are unnecessary because they will duplicate efforts of state governments that are introducing tough anti-bullying laws.

Take Victoria for example.  Under Brodie's Law, bullies can face a 10-year prison term.  In serious cases, and where bullying is likely to continue, the courts can issue intervention orders as a preventative measure.

Additionally, individuals who bully fellow employees can be liable for fines up to $253,512 under workplace health and safety laws, while corporate employers risk fines up to $1,267,560.

What we can be certain about is that the new anti-bullying jurisdiction will make an already litigious industrial relations system worse.

Unfair and unlawful dismissal and general protections applications have skyrocketed in the past four years following the introduction of the Fair Work Act.

Annual reports show that in 2008-09, the Australian Industrial Relations Commission (the Fair Work Commission's predecessor) heard 7994 applications for termination matters.

By 2012-13, applications to the Fair Work Commission for termination matters had exploded to 17,375.  These figures do not include applications for non-termination matters, applications made to the Federal Court or appeals.

Although alarming, the figures are not surprising.  The Fair Work Act extended unfair dismissal laws to an estimated 100,000 previously exempt businesses.  General protections expanded so that workplace rights now affect all aspects of the employment relationship.

In termination matters, the reversal of the onus of proof means that employers are presumed to be at fault.

Of course, there is no doubt that bullying can be a serious problem in workplaces and the physical and mental effects of bullying cannot be overlooked.

However, dignity in the workplace will only flourish when the industrial relations system empowers individuals to work collaboratively to resolve workplace issues.  The present system ingrains hostility by relying on the commission every time a dispute arises.

The new anti-bullying jurisdiction is yet another example of the increasing over-reach of the industrial relations system.

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