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‘Reasonable’ performance management not bullying – FWC

AN appeal application recently rejected by a Fair Work Commission Full Bench has confirmed employer guidelines around ‘reasonable management action’ when defending allegations of workplace bullying.

The case, Aly v Commonwealth Securities Limited and others (30 October 2015), involved a current Commsec employee who was seeking stop bullying orders from the Fair Work Commission, with the bullying allegations primarily concerning the actions of Mr Aly’s superiors in attempting to performance-manage him.

Following Commissioner Bissett’s decision of 10 August 2015 that the behaviour of Mr Aly’s managers constituted ‘reasonable management action’, the applicant was seeking permission to appeal under the Fair Work Act’s bullying jurisdiction.

Full Bench draws on 2014 ‘guidelines’ to reject appeal

The Full Bench rejected the appeal and determined the original decision of Commissioner Bissett had not erred. They similarly found that the ‘reasonable’ performance management process undertaken meant that it was not bullying.

In order to come to this ruling, the Full Bench relied on guidelines from a 2014 case presided by Commissioner Hampton. Specifically, the Full Bench said Hampton C’s observations ‘were not called into question’ and that they ‘represent a helpful outline of the approach’.

In his 2014 ruling, Hampton C applied the following guidelines to the then-new FWC Bullying jurisdiction (direct extract of Application by Ms SB [2014] FWC 2104):

[49] Determining whether management action is reasonable requires an objective assessment of the action in the context of the circumstances and knowledge of those involved at the time. Without limiting that assessment, the considerations might include:

  • the circumstances that led to and created the need for the management action to be taken;
  • the circumstances while the management action was being taken; and
  • the consequences that flowed from the management action.

[50] The specific ‘attributes and circumstances’ of the situation including the emotional state and psychological health of the worker involved may also be relevant.

[51] The test is whether the management action was reasonable, not whether it could have been undertaken in a manner that was ‘more reasonable’ or ‘more acceptable’. In general terms this is likely to mean that:

  • management actions do not need to be perfect or ideal to be considered reasonable;
  • a course of action may still be ‘reasonable action’ even if particular steps are not;
  • to be considered reasonable, the action must also be lawful and not be ‘irrational, absurd or ridiculous’;
  • any ‘unreasonableness’ must arise from the actual management action in question, rather than the applicant’s perception of it; and
  • consideration may be given as to whether the management action involved a significant departure from established policies or procedures, and if so, whether the departure was reasonable in the circumstances.

[52] For the circumstances in s.789FD (2) of the FW Act to apply, the management action must also be carried out in a ‘reasonable manner’. Consistent with the approach above, what is ‘reasonable’ is a question of fact and the test is an objective one.

[53] Whether the management action was taken in a reasonable manner may depend on the action, the facts and circumstances giving rise to the requirement for action, the way in which the action impacts upon the worker and the circumstances in which the action was implemented and any other relevant matters.”

Upon examining these guidelines against Mr Aly’s evidence, the Full Bench ruled Commissioner Bissett was correct in ruling against the bullying orders in the first instance.

What can AREEA Members learn from this decision?

Since the advent of the Fair Work Commission’s bullying jurisdiction, many of the applications have been rejected where the employer can demonstrate that they were simply carrying out a performance management or disciplinary process.

This has been demonstrated repeatedly as a clear defence to bullying allegations because the Fair Work Act recognises that managers must sometimes performance manage staff in a ‘reasonable manner’.

AREEA members can protect themselves against future bullying claims by ensuring their management processes are ‘best practice’ and would be viewed as ‘reasonable’ by the Commission.

In the first instance, employers should have well-structured and well-communicated bullying and performance management policies in place. These policies should set out the steps the company would follow if performance management is required and what the company defines as reasonable management action.

Secondly, managers and supervisors should be trained in and be familiar with these policies and where/how they would become involved in the process. This should be peer reviewed to ensure complete compliance with the policies of the organisation and applicable workplace laws.

For advice on all workplace bullying, performance management or other employment issues, contact an AREEA consultant or legal professional at your local AREEA office.

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