General protections cases and the first hurdle

As we know most general protections cases which are not initially settled by the Fair Work Commission are determined thereafter by the Federal Circuit Court rather than the Federal Court. In this interesting extract from a recent decision of that court, the court was asked to summarily strike out such a claim on the basis of a lack of legal merit and here are the principles applied to that issue.

“Summary dismissal

  1. Rule 13.10 provides that the Court may summarily dismiss a proceeding or claim for relief if the party prosecuting the proceeding or claim for relief has no reasonable prospect of successfully prosecuting the proceeding; or claim or the proceeding or claim for relief is frivolous or vexatious; or the proceeding or claim for relief is an abuse of the process of the Court.  The respondent in its written submissions has conveniently summarised approach to that rule.
  2. There are six principles that are said to guide the exercise of the power to grant summary judgment pursuant to s.31A of the Federal Court of Australia Act 1976 (Cth): Jefferson Ford Pty Ltd v Ford Motor Company of Australia Ltd (2008) 167 FCR 372 at [124] – [132]. The principles applicable to that section are equally applicable to s.17A of the Federal Circuit Court Act: Prior v Wood [2017] FCA 193 at [16] – [24]. Adopting those principles to the present case, they may be stated as follows:
  3. a)First, a less stringent test for the grant of summary judgment is prescribed by the statutory formula in s.17A than those applicable under earlier regimes. Parliament’s purpose, in enacting the section, was to strengthen the Court’s power to dispose of unmeritorious matters and to strengthen the Court’s power to manage proceedings, thus assisting in reducing cost and delay: Boston Commercial Services Pty Ltd v GE Capital  Finance  Australasia  Pty   Ltd (2006) 70 IPR 146 at [45]; Paramasivam v  University  of  New  South  Wales [2007] FCAFC 176 at [41] and PZ Cussons (International) Limited  v  Rosa  Dora  Imports  Pty  Ltd [2007] FCA 1642 at [13].
  4. b)Second, the assessment of reasonable prospects involves the following steps:
  5. i)identification of the cause of action pleaded;
  6. ii)identification of the pleaded facts said to give rise to that cause of action;

iii)         a review of the evidence (if any) tendered in support of the claim for judgment;

  1. iv)identification of the defence pleaded;
  2. v)identification of any facts pleaded which are said to give rise to the defence; and
  3. vi)a review of the evidence (if any) tendered in defence of the claim.
  4. c)Third, the moving party bears the onus of persuading the Court that the opponent has no reasonable prospect of success. However, once the moving party has established a prima facie case to that effect, the opposing party must respond by pointing to specific factual or evidentiary disputes which make a trial necessary. General denials will not be a sufficient basis for resisting summary judgment;
  5. d)Fourth, the decision to grant summary judgment is made as a question of law and reviewed as such by an appellate court. The word “may” is used in an “empowering” sense rather than as denoting the exercise of a discretion;
  6. e)Fifthly, where there is a real issue of fact relevant to a pleaded cause of action, it is unlikely that the proceedings will have no prospect of success;
  7. f)Sixth, in discerning whether a real issue of fact exists, the Court must draw all reasonable inferences in favour of the non-moving party.
  8. Moreover, the principles in relation to rule 13.10(b) were relevantly considered by the Federal Court in Rana v Commonwealth [2013] FCA 189:
  9. Proceedings have been held to be “vexatious” in the past if they are instituted with the intention of annoying or embarrassing the person against whom they are brought; they are brought for collateral purposes, and are not for the purpose of having the court adjudicate on the issues to which they give rise; irrespective of the motive of the litigant, they are so obviously untenable or manifestly groundless as to be utterly hopeless; or they are scandalous, disclose no reasonable cause of action, are oppressive, are embarrassing, or are an abuse of the process of the court: see generally Attorney-General v Wentworth (1988) 14 NSWLR 481.
  10. It has also been pointed out that “vexatiousness” is a quality of the proceeding rather than a litigant’s intention so that the “question is not whether they have been instituted vexatiously but whether the legal proceedings are in fact vexatious”: Re Vernazza [1960] 1 QB 197 at 208. (Emphasis added)

Consideration

  1. The gravamen of the applicant’s claim is that the respondent took adverse action against her by, on 24 June, 2019 terminating the alleged contract of services she had with the first respondent or by refusing to further engage the applicant as an independent contractor for reasons proscribed by the Fair Work Act.
  2. Section 340 of the Act prohibits a person from taking adverse action against another:

(a)          because the other person:

(b)          has a workplace right; or

(c)          has, or has not, exercised a workplace right; or

(d)          proposes or proposes not to, or has at any time proposed or proposed not to, exercise a workplace right; or

(e)          to prevent the exercise of a workplace right by the other person.

  1. Adverse action is defined in the Fair Work Act in s.342. Relevantly, for these proceedings, there are two circumstances in which adverse action will occur. The first is described in item 3 in the table to s.342(1) which provides that a person who has entered into a contract for services with an independent contractor takes adverse action against that independent contractor where the first person terminates the contract or refuses to make use of or agree to make use of services offered by that independent contractor. The second is described in item 4 in the table and provides that a person proposing to enter into a contract for services with an independent contractor takes adverse action against the independent contractor if that person refuses to engage the independent contractor or refuses to make use of or agreed to make use of services offered by the independent contractor.
  2. Leaving aside all other questions, if the applicant proves the facts alleged in her amended application, she will most likely demonstrate that the respondent has taken adverse action against her because either the contract of services that existed between she and the respondent was terminated as she alleges or alternatively the respondent has refused to engage her in a contract of services or to further engage her to perform services under her contract.
  3. Workplace right is defined in s.341 of the Fair Work Act as follows:

341  Meaning of workplace right

Meaning of workplace right

(1)  A person has a workplace right if the person:

(a)  is entitled to the benefit of, or has a role or responsibility under, a workplace law, workplace instrument or order made by an industrial body; or

(b)  is able to initiate, or participate in, a process or proceedings under a workplace law or workplace instrument; or

(c)  is able to make a complaint or inquiry:

(i)  to a person or body having the capacity under a workplace law to seek compliance with that law or a workplace instrument; or

(ii)  if the person is an employee—in relation to his or her employment.

  1. Workplace law is defined in s.12 of the act as follows:

workplace law means:

(a)  this Act; or

(b)  the Registered Organisations Act; or

(c) the Independent Contractors Act 2006; or

(d)  any other law of the Commonwealth, a State or a Territory that regulates the relationships between employers and employees (including by dealing with occupational health and safety matters).

  1. Section 11 of the Fair Work Act provides that the terms employer and employee in this definition have their ordinary meanings.
  2. In Tattsbet Ltd v Morrow (2015) 233 FCR 46 Jessup J adopted and applied a passage from the judgment of Issacs J in Clyde Engineering Co Ltd v Cowburn (1926) 37 CLR 466 to conclude that the phrase law of the Commonwealth in subparagraph (d) of the definition of workplace law referred to the particular rights and entitlements created by the separate provisions of a statute rather than the statute itself.  In Cowburn Issacs J said at 497:

…[T]he “law” is not the piece of parchment or paper, nor is it the letters and words and figures printed upon the material.  It consists of the “rule” resolved upon and adopted by the legislative organ of the community as that which is to be observed, positively and negatively, by action or inaction according to the tenor of the rule adopted. Constitutions may prescribe, and do prescribe, how that rule shall be arrived at and how evidenced. But “the law” is essentially the rule itself, and not the material evidence of it.

  1. In Tattsbet one of the issues was whether the Superannuation Guarantee Charge Act 1992 (Cth), which had an extended operation in respect of independent contractors, was a workplace law for the purposes of the Fair Work Act. On the basis that the applicant in that case was an independent contractor, Jessup J said:
  2. Was the respondent entitled to the benefit of a law of the Commonwealth, in the sense exposed above, that regulated the relationships between employers and employees? Assuming for the moment that the agency agreement answered the description in s 12(3) of the SGA Act, the answer must be no. If the respondent was entitled to anything under the SGA Act, that entitlement arose under the provisions of that Act that extended its operation beyond the circumstances of employees strictly so called. Those provisions did not regulate the relationships between employers and employees.
  3. In the result, I would hold that the respondent, considered as someone who was not an employee in the common law sense, was not entitled to the benefit of so much of the SGA Act as was a “workplace law” within the meaning of s 341(1)(a) of the FW Act. I have two reasons for that conclusion, either of which would be sufficient: first, that it has not been established that the agency agreement was a contract of a kind referred to in s 12(3) of the SGA Act, and secondly, that the provisions of the SGA Act that entitled non‑employees to superannuation were not a “workplace law” within the meaning of Pt 3-1 of the FW Act.
  4. Here the respondent argues that:

(a)          s.28B of the Sex Discrimination Act is a law that regulates the relationships between employers and employees;

(b)          it is a workplace law for the purposes of s.12 of the Fair Work Act; but

(c)          given that even on her own case, the applicant is not an employee she is not entitled to the benefit of s 28B of Sex Discrimination Act and section s. 341(1) of the Fair Work Act is not engaged; and

(d)          the Sex Discrimination Act is not a workplace law for the purposes of the Fair Work Act in so far as the applicant is concerned because she is not an employee and it does not entitle the applicant to a benefit that meets the definition of workplace right.

  1. I think this argument must be accepted. Section 28B of the Act is in the following terms:

28B  Employment, partnerships etc.

(1)  It is unlawful for a person to sexually harass:

(a)  an employee of the person; or

(b)  a person who is seeking to become an employee of the person.

(2)  It is unlawful for an employee to sexually harass a fellow employee or a person who is seeking employment with the same employer.

(3)  It is unlawful for a person to sexually harass:

(a)  a commission agent or contract worker of the person; or

(b)  a person who is seeking to become a commission agent or contract worker of the person.

(4)  It is unlawful for a commission agent or contract worker to sexually harass a fellow commission agent or fellow contract worker.

(5)  It is unlawful for a partner in a partnership to sexually harass another partner, or a person who is seeking to become a partner, in the same partnership.

(6)  It is unlawful for a workplace participant to sexually harass another workplace participant at a place that is a workplace of either or both of those persons.

(7)  In this section:

place includes a ship, aircraft or vehicle.

workplace means a place at which a workplace participant works or otherwise carries out functions in connection with being a workplace participant.

workplace participant means any of the following:

(a)  an employer or employee;

(b)  a commission agent or contract worker;

(c)  a partner in a partnership.

  1. Some definitional sections from the Sex Discrimination Act are relevant:

4 Interpretation

(1) in this Act, unless the contrary intention appears:

“contract worker” means a person who does work for another person pursuant to a contract between the employer of the first mentioned person and that other person.

“employment” includes:

(a) part-time and temporary employment;

(b) work under a contract for services; and

(c) work as a Commonwealth employee.

“principal” means:

(a) in relation to a commission agent – a person for whom the commission agent does work as a commission agent; and

(b) in relation to a contract worker – a person for whom the contract worker does work pursuant to a contract between the employer of the contract worker and the person.

  1. There can be no doubt that s.28B(1) of the Sex Discrimination Act is a law that regulates the relationship between employers and employees. So too, s.28B(2). But by its terms, s.28B(3) regulates other relationships – those of commission agents and arguably independent contractors. The applicants entitlement to protection from sexual harassment arose under s.28B(3) or perhaps s.28B(6). In my view, they are not laws of the Commonwealth that regulate the relationships between employers and employees.
  2. Accordingly, to the extent that the applicant’s claims depend upon her asserting that:

(a)          she had the benefit of a workplace law; or

(b)          that she was able to initiate a process under a workplace law; or

(c)          able to make a complaint or inquiry to a person or body having the capacity under a workplace law to seek compliance with that law

her claim, I find, has no reasonable prospects of success.

  1. Recourse to s.351 of the Fair Work Act does not assist the applicant either because that section only applies as between employers and employees as those terms are ordinarily understood.
  2. For the same reasons, the applicant’s claim based upon s.343 must fail. That section is in the following terms:

343  Coercion

(1)  A person must not organise or take, or threaten to organise or take, any action against another person with intent to coerce the other person, or a third person, to:

(a)  exercise or not exercise, or propose to exercise or not exercise, a workplace right; or

(b)  exercise, or propose to exercise, a workplace right in a particular way.

Note:         This subsection is a civil remedy provision (see Part 4‑1).

(2)  Subsection (1) does not apply to protected industrial action.

  1. It will be seen that this section directs attention to workplace right which, through the definition of workplace law, in this case, depends upon the existence of a law of the Commonwealth that regulates the relationship between employer and employee.  For the reasons I have expressed above, that vital element is missing in the present case.

Conclusion

  1. I accept the respondent’s submission that the facts so carefully identified by the applicant in her amended claim are not capable of establishing that the applicant had the benefit of a workplace right for the purposes of the Fair Work Act, in the way in which she asserts.
  2. Assuming the facts that she pleads are true, the action taken or threatened to be taken by Mr Malady arising from her rejecting his sexual advances was not actionable adverse action for the purposes of the Fair Work Act.
  3. I am satisfied that there is no reasonable prospect of the applicant successfully prosecuting the proceeding or the specific claims for relief relating to the alleged contraventions of the Fair Work Act. The proceeding should be summarily dismissed in its entirety for that reason.
  4. I am also satisfied that the proceeding is vexatious in the sense described in Rana because they disclose no reasonable cause of action.”

 

BUCHANAN v KONTRACTOR PTY LTD [2020] FCCA 3331 delivered 8 December 2020 per Jarrett J