General protections cases, evidence issues and the law

This extract from a recent Federal Court decision in a general protections case involving allegations of prohibited adverse action involving a dismissal contain very useful observations and summaries of the relevant state of the applicable law.

 

“6.1 Employment-related complaints

84    In PIA Mortgage Services Pty Ltd v King (2020) 274 FCR 225 (hereafter, “PIA”), 252-253 [134]-[139] (Snaden J), I made the following relevant observations, which are apt to be applied presently:

In order that the making of a complaint or inquiry might amount to the exercise of a workplace right of the sort to which s 341(1)(c)(ii) of the FW Act refers, it must pertain, as a matter of substance, to its maker’s employment. That being so, it is necessary to consider whether either or both of the [complaints that were made in that case] were of that nature: that is, were they complaints or inquiries that pertained to Mr King’s employment?

That requires analysis at two levels: first, did each of the [relevant complaints] qualify as a “complaint or inquiry”; and, second, did each arise “in relation to [Mr King’s] employment”?

The Macquarie Dictionary relevantly defines “complaint” and “inquiry” respectively as follows:

complaint

  1. an expression of grief, regret, pain, censure, resentment, or discontent; lament; fault-finding.
  2. a cause of grief, discontent, lamentation, etc.

inquiry

  1. the act of inquiring, or seeking information by questioning; interrogation.
  2. a question; query.

– phr 4. make inquiry (or inquiries), to request information: to make inquiries at the office.

A “complaint”, then, is a communication that states a grievance or that otherwise asserts the existence of a state of affairs that its maker alleges is unsatisfactory, undesirable or unacceptable: see, in that vein, Hill v Compass Ten Pty Ltd (2012) 205 FCR 94 (Cowdroy J). In Shea v TRUenergy Services Pty Ltd (No 6) (2014) 314 ALR 346…this court had occasion to consider what might qualify as a “complaint” for the purposes of s 341(1)(c)(ii) of the FW Act. Dodds-Streeton J there observed (at 353-354 [29]) that:

…in the context of s 341(1)(c)(ii) of the [FW] Act:

(a)    a complaint is a communication which, whether expressly or implicitly, as a matter of substance, irrespective of the words used, conveys a grievance, a finding of fault or accusation;

(b)    the grievance, finding of fault or accusation must be genuinely held or considered valid by the complainant;

(c)    the grievance, finding of fault or accusation need not be substantiated, proved or ultimately established, but the exercise of the workplace right constituted by the making of the complaint must be in good faith and for a proper purpose; [and]

(d)    the proper purpose of making a complaint is giving notification of the grievance, accusation or finding of fault so that it may be, at least, received and, where appropriate, investigated or redressed. If a grievance or accusation is communicated in order to achieve some extraneous purpose unrelated to its notification, investigation or redress, it is not a complaint made in good faith for a proper purpose and is not within the ambit of s 341(1)(c)(ii)…

I respectfully adopt her Honour’s reasoning. I note that the second of the four propositions to which her Honour adverted in the passage above was the subject of some consideration on appeal: see Shea v EnergyAustralia Services Pty Ltd (2014) 242 IR 159, 163 [12] (Rares, Flick and Jagot JJ). Whilst the full court did not appear to adopt Dodds-Streeton’s J implication of good faith, they did not reject it and the appeal was decided on other issues: see, on that score, The Environmental Group Ltd v Bowd [2019] FCA 951, [144] (Steward J)…

Whether a complaint or inquiry qualifies as a complaint or inquiry made “in relation to…employment” depends upon the subject matter that is sought to be agitated. It is not necessary that a complaint be directly related to its maker’s employment: Construction, Forestry, Mining and Energy Union v Pilbara Iron Company (Services) Pty Ltd (No 3) [2012] FCA 697, [64] (Katzmann J); Shea, [631] (Dodds-Streeton J). In Walsh v Greater Metropolitan Cemeteries Trust (No 2) (2014) 243 IR 468, 476 [42] (Bromberg J), this court determined that the connection between a complaint and employment would likely exist in circumstances “[w]here the subject matter of the complaint raises an issue with potential implications for the complainant’s employment”.

That reasoning has been followed (see, for example, Milardovic v Vemco Services Pty Ltd (Administrators Appointed) [2016] FCA 19, [68]-[69] (Mortimer J)) although not universally without qualification (see, for example, The Environmental Group Ltd v Bowd [2019] FCA 951, [126] (Steward J)).

85    I dissented in the outcome of that case; but I do not apprehend that there is anything about those observations that is (or then was) materially controversial.

86    In The Environment Group Ltd v Bowd (2019) 137 ACSR 352 (hereafter, “Bowd”), Steward J questioned whether the “potential implications” test might be appropriate for senior management employees, whose conduct as such might be thought always to have at least potential employment ramifications. His Honour observed (at 392 [126]):

…in the case of a CEO, the complaint must be one directed at or concerned with that person’s employment in a substantive way. In that respect, observing the required nexus may be direct or indirect, may not greatly assist. It must, as a matter of substance, be about that CEO’s employment.

87    His Honour was led to that conclusion after considering what might be meant of the phrase “in relation to” in s 341(1)(c)(ii) of the FW Act. His Honour observed (at [124]):

As an expression of a sufficient nexus, the High Court has observed that the similar phrase “in respect of” has a “chameleon-like quality”. It takes its meaning from its context: Technical Products Pty Ltd v State Government Insurance Office (1989) 167 CLR 45 at 47; see also Commissioner of Taxation v Scully (2000) 201 CLR 148 at 182-183. In my view, that observation applies equally to the phrase “in relation to”. The statutory context here is the protection of employees who exercise workplace rights. One of those rights is an entitlement to make a complaint about a person’s employment without the fear or risk of retribution.

88    The phrase “in relation to” is one of “wide and general import”: Fountain v Alexander (1982) 150 CLR 615, 629 (Mason J). Save insofar as statutory context might suggest otherwise, it contemplates a relationship between two subject matters: O’Grady v The Northern Queensland Co Ltd (1990) 169 CLR 356, 376 (McHugh J); Smith v Federal Commissioner of Taxation (1987) 164 CLR 513, 520-521 (Brennan J), 533 (Toohey J, with whom Wilson J agreed). The phrase (or analogues of it):

…is extremely wide but it is also vague and indefinite. Clearly enough it predicates the existence of some kind of relationship but it leaves unspecified the plane upon which the relationship is to be sought and identified. That being so, all that a court can do is to endeavour to seek some precision in the context in which the expression is used.

See: Tooheys Ltd v Commissioner of Stamp Duties (NSW) (1961) 105 CLR 602, 620 (Taylor J, with whom Dixon CJ and Windeyer J agreed in the result; Kitto and Menzies JJ dissenting.)

89    For the purposes of s 341(1)(c)(ii) of the FW Act, a complaint that an employee makes will be one that is made “in relation to” his or her employment if the subject matter about which a complaint is made concerns an aspect of that employment.

6.2 What does it mean to be “able to” complain or inquire?

90    Much has been written in this court about the circumstances that suffice to distinguish complaints or inquiries that employees are “able to make” (for the purposes of s 341(1)(c) of the FW Act) and complaints or inquiries of other kinds. Recently, in Messenger v Commonwealth of Australia (Represented by the Department of Finance) [2022] FCA 677 [141]-[143] (Snaden J), I made the following observations on that score:

Insofar as is presently relevant, s 340(1) of the FW Act prohibits the taking of adverse action against a person because he or she has exercised a workplace right. Section 341(1) identifies the circumstances in which a person should be understood to possess such a right. For present purposes, it is only in circumstances where a person exercises a right that he or she possesses that the protection for which s 340(1)(a)(ii) provides is enlivened.

A person has—and, therefore, may exercise—a right to complain or inquire in relation to their employment, or in order to obtain compliance with a workplace law if that complaint or inquiry is one that they are “able to make”: FW Act, s 341(1)(c). In Shea v TRUenergy Services Pty Ltd (No 6) (2014) 314 ALR 346, (hereafter, “Shea”; Dodds-Streeton J), this court made the following relevant observations (at 440 [625]):

…the requirement that the complaint be one that the employee “is able to make” in relation to his or her employment suggests that there are complaints which the employee is not able to make in relation to his or her employment. The ability to make a complaint does not arise simply because the complainant is an employee of the employer. Rather, it must be underpinned by an entitlement or right. The source of such entitlement would include, even if it is not limited to, an instrument, such as a contract of employment, award or legislation.

Her Honour’s observations have been endorsed at a full court level: PIA, 229 [12] (Rangiah and Charlesworth JJ), 257-258 [164] (Snaden J); Cigarette & Gift Warehouse Pty Ltd v Whelan (2019) 268 FCR 46 (hereafter, “Whelan”), 55-56 [28] (Greenwood, Logan and Derrington JJ).

91    I went on in that matter to trace some of the authorities that have addressed what it means to be “able to make” a complaint or inquiry for the purposes of s 341(1)(c) of the FW Act. That analysis culminated (at [149]-[150]) in the following observations, which I adopt for present purposes:

…Section 341 does not invest employees with new rights. It merely characterises existing rights or entitlements as “workplace rights”, the possession or exercise of which is the subject of protections located elsewhere in pt 3-1 of the FW Act.

…successive full courts have now made clear [that] in order that a complaint or inquiry made in relation to employment might qualify as the exercise of a workplace right, an employee must first demonstrate that it was made in the exercise of, or otherwise to protect or vindicate, some right or entitlement conferred upon them, whether instrumentally or otherwise. It is not sufficient that a complaint or inquiry is made simply because the employee feels (with good justification or otherwise) that he or she has something about which to complain or inquire.

6.3 Proof of proscribed purpose

92    As it often does in matters such as this, s 361 of the FW Act—and the statutory presumption that it establishes—here looms large. Mr Serpanos claims to have exercised a number of workplace rights whilst employed. He attributes his dismissal to his having done so.

93    Two issues arise for consideration: did Mr Serpanos exercise a workplace right or workplace rights and, if he did, was he dismissed because (or for reasons that included that) he did so? The first half of that equation is for Mr Serpanos to establish: Tattsbet Ltd v Morrow (2015) 233 FCR 46, 75 [119] (Jessup J); Australian Building and Construction Commissioner v Hall (2018) 261 FCR 347, 380 [100] (“Hall”; Tracey, Reeves and Bromwich JJ). If he succeeds in that endeavour, s 361(1) requires that the court presume that the second question should be answered in the affirmative, unless or until the ATO proves to the contrary.

94    Section 361(1) places upon a person who takes adverse action “…the onus of proving that which lies peculiarly within his own knowledge”: General Motors Holden Pty Ltd v Bowling (1976) 12 ALR 605 (“Bowling”), 617 (Mason J).

95    Discharge of that burden requires that the ATO lead (and that the court accept) evidence as to why it was that Mr Serpanos was dismissed. More accurately, it requires evidence as to what did not actuate the dismissal (which is a task most often discharged by proving what did). The ATO must positively establish that Mr Serpanos’s exercise of a workplace right or workplace rights did not factor in any substantial or operative way as a reason for its decision to effect his dismissal: Bowling, 612 (Gibbs J), 619 (Mason J, with whom Stephen and Jacobs JJ agreed).

96    In Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500 (hereafter, “Barclay”), the High Court had occasion to consider how an employer might rebut the statutory presumption. French CJ and Crennan J (with whom Gummow and Hayne JJ agreed) observed (at 517 [44]-[45]) (references omitted):

…The imposition of the statutory presumption in s 361, and the correlative onus on employers, naturally and ordinarily mean that direct evidence of a decision-maker as to state of mind, intent or purpose will bear upon the question of why adverse action was taken, although the central question remains “why was the adverse action taken?”

This question is one of fact, which must be answered in the light of all the facts established in the proceeding. Generally, it will be extremely difficult to displace the statutory presumption in s 361 if no direct testimony is given by the decision-maker acting on behalf of the employer. Direct evidence of the reason why a decision-maker took adverse action, which may include positive evidence that the action was not taken for a prohibited reason, may be unreliable because of other contradictory evidence given by the decision-maker or because other objective facts are proven which contradict the decision-maker’s evidence. However, direct testimony from the decision-maker which is accepted as reliable is capable of discharging the burden upon an employer…

97    Barclay involved an appeal from a judgment of this court: Barclay v Board of Bendigo Regional Institute of Technical and Further Education (2011) 191 FCR 212 (Gray, Lander and Bromberg JJ). The matter involved a union representative, Mr Barclay, who had been suspended from his position with the Bendigo Regional Institute of Technical and Further Education. He alleged that the reasons for which he had been suspended included that he was an officer of an industrial association and that he had engaged in particular kinds of “industrial activity” (as defined in s 347 of the FW Act). He alleged that his suspension contravened s 346 of the FW Act.

98    At trial, evidence was led of the process by which Mr Barclay came to have been suspended. The court accepted the evidence of the Chief Executive Officer of the TAFE that it was her decision to effect the suspension and that neither Mr Barclay’s status as an officer of an industrial association nor his engagement in industrial activity were matters that factored in her decision to do so: Barclay v Board of Bendigo Regional Institute of Technical and Further Education (2010) 193 IR 251 (Tracey J).

99    On appeal, a majority of this court (Gray and Bromberg JJ) determined that the reasons animating particular adverse action might be found otherwise than in the mind of the person or persons through whose conduct it was effected. Their Honours held (at 221 [28]):

The state of mind or subjective intention of that person will be centrally relevant, but it is not decisive. What is required is a determination of what Mason J in Bowling [(1976) 51 ALJR 235 at 241]… called the ‘real reason’ for the conduct. The real reason for a person’s conduct is not necessarily the reason that the person asserts, even where the person genuinely believes he or she was motivated by that reason. The search is for what actuated the conduct of the person, not for what the person thinks he or she was actuated by. In that regard, the real reason may be conscious or unconscious, and where unconscious or not appreciated or understood, adverse action will not be excused simply because its perpetrator held a benevolent intent. It is not open to the decision-maker to choose to ignore the objective connection between the decision he or she is making and the attribute or activity in question.

100    In dissent, Lander J preferred the conclusion of the primary judge.

101    The majority’s reasoning was not the first time that the full court of this court had endorsed the notion that the reasons for which adverse action (or its statutory predecessors) is taken might be “unconscious” or discerned otherwise than through interrogation of the mental processes of the person or people by whose conduct it is taken. Elliott v Kodak Australasia Pty Ltd (2001) 129 IR 251 (“Kodak”; Lee, Madgwick and Gyles JJ) involved the dismissal of an employee, Mr Elliott. He was dismissed as part of a redundancy program, which had involved a process of assessment that was carried out by two supervisors, Messrs Shannon and Lay. The decision to proceed with the redundancies (including that of Mr Elliott) was made by the employer’s general manager, Mr Walshe; but the court determined that its reasons for effecting the dismissals resided also in the minds of the two supervisors. That was so because they were said to have made “an indispensable contribution to the rankings”. Their Honours determined (at 260 [37]) that:

…if the Lay/Shannon assessment [was] affected (or infected) by either Lay or Shannon having held an undisclosed prohibited reason, then [Mr Walshe] would have, in effect, inadvertently adopted it so that its force continued regardless of the lack of any express prohibited reason in the mind of Walshe.

102    Similar reasoning was employed in National Tertiary Education Union v Royal Melbourne Institute of Technology (2013) 234 IR 139, 147-148 [25]-[29] (hereafter, “RMIT”; Gray J); Voigtsberger v Council of the Shire of Pine Rivers (No 2) (1981) 58 FLR 239, 255-256 (hereafter, “Voigtsberger”; Evatt J); Construction, Forestry, Mining & Energy Union v Pilbara Iron Company (Services) Pty Ltd (No 3) [2012] FCA 697, [78] (hereafter, “Pilbara Iron”; Katzmann J).

103    I return to Barclay. In the High Court, Mr Barclay (and the other respondents) sought to uphold the reasoning that had attracted itself to Gray and Bromberg JJ on the basis that contraventions of s 346 of the FW Act should properly fall to be determined objectively. French CJ and Crennan J (with whom Gummow and Hayne JJ agreed) squarely rejected that contention. Their Honours observed (at 517 [44]):

There is no warrant to be derived from the text of the relevant provisions of the Fair Work Act for treating the statutory expression “because” in s 346, or the statutory presumption in s 361, as requiring only an objective inquiry into a defendant employer’s reason, including any unconscious reason, for taking adverse action.

104    Gummow and Hayne JJ considered whether proof of a proscribed reason for the purposes of s 346 required a purely objective or purely subjective approach. Their Honours took the view that neither was required. They reasoned that objective circumstances might, in some matters, serve to inform the acceptance or rejection of evidence of a decision-maker’s subjective reasons for acting in any given way. Nonetheless, they stressed that the focus of the inquiry was upon the reasons of the decision maker. Their Honours observed (at 542 [127]):

In determining an application under s 346 the Federal Court was to assess whether the engagement of an employee in an industrial activity was a “substantial and operative factor” as to constitute a “reason”, potentially amongst many reasons, for adverse action to be taken against that employee. In assessing the evidence led to discharge the onus upon the employer under s 361(1), the reliability and weight of such evidence was to be balanced against evidence adduced by the employee and the overall facts and circumstances of each case; but it was the reasons of the decision-maker at the time the adverse action was taken which was the focus of the inquiry.

105    Heydon J took the view that “…[e]xamining whether a particular reason was an operative or immediate reason for an action calls for an inquiry into the mental processes of the person responsible for that action”: Barclay, 544 [140]. His Honour observed (at Barclay, 546 [146]):

To search for the “reason” for a voluntary action is to search for the reasoning actually employed by the person who acted. Nothing in the Act expressly suggests that the courts are to search for “unconscious” elements in the impugned reasoning of persons in Dr Harvey’s position. No requirement for such search can be implied. This is so if only because it would create an impossible burden on employers accused of contravening s 346 of the Act to search the minds of the employees whose conduct is said to have caused the contravention…

106    The High Court had occasion to consider the issue again in Construction, Forestry Mining and Energy Union v BHP Coal Pty Ltd (2014) 253 CLR 243 (hereafter, “BHP Coal”). There, an employee, Mr Doevendans, had been dismissed for brandishing an offensive sign at a rally that had been arranged by the applicant union in support of industrial action that it had organised. The employer (through its representative, Mr Brick) was said to have dismissed him because, or for reasons that included that, he had partaken in “industrial activity”. The employer maintained that Mr Doevendans had been dismissed because of the offensive nature of his sign, not because of his union activism or participation in industrial activity.

107    The High Court considered whether those facts sufficed to make out a contravention of s 346 of the FW Act. By majority (French CJ, Kiefel and Gageler JJ, Hayne and Crennan JJ dissenting), it concluded that they did not. Relevantly for present purposes, French CJ and Kiefel J said (at 249 [7]):

The focus of the inquiry as to whether s 346(b) has been contravened is upon the reasons for Mr Brick taking the adverse action. This is evident from the word “because” in s 346, and from the terms of s 361. The inquiry involves a search for the reasoning actually employed by Mr Brick. The determination to be made by the court is one of fact, taking account of all the facts and circumstances of the case and available inferences.

(emphasis added, references omitted)

Cited as authority for the emphasised propositions were the observations of Heydon J in Barclay reproduced above (at [105]).

108    Gageler J was drawn to a similar observation. Referring to Barclay, his Honour noted (at 267 [85]):

The unanimous holding in that case was that, read in the context of ss 360 and 361 of the Act and of its legislative history, the word “because” in s 346 of the Act connotes the existence of a particular reason as an operative and immediate reason for taking adverse action. Where the adverse action taken is in consequence of a decision made by a responsible individual within a corporation, the existence or non-existence of a particular reason as an operative and immediate reason for taking that adverse action turns on an inquiry into the mental processes of that individual.

109    The issue arose again in this court in Construction, Forestry, Mining and Energy Union v Endeavour Coal (2015) 231 FCR 150 (hereafter, “Endeavour Coal”; Jessup, Perram and Bromberg JJ). As this one does, that matter involved allegations of breach of s 340(1) of the FW Act. The respondent employer was charged with having taken adverse action against one of the applicant’s members, Mr McDermott, because he had taken personal leave to which he was entitled. The action in question involved Mr McDermott’s removal from a weekend roster. The employer led evidence to establish that the action was taken because of the lack of predictability in Mr McDermott’s attendance and in order to ensure that its weekend work fell to its most reliable employees. At first instance, that was accepted and the application was dismissed.

110    By majority, an appeal from that judgment was dismissed. In separate judgments, Jessup and Perram JJ found that the inquiry into the reasons for which the employer was moved to act as it did focused upon, as Jessup J put it (at 161 [32]), “…the actual reason of the decision-maker, in his or her own mind” (see also the equivalent observation of Perram J at 169 [77]). Referring to BHP Coal, Perram J observed (at 169 [75]):

The logic of that decision establishes that the question posed by s 340(1) concerns only the state of mind of the decision-maker.

Later, his Honour observed that “…[t]he inquiry thrown up by s 340 is not one concerned with causation but, rather, the subjective reasons for action of the decision-maker”.

111    In dissent, Bromberg J distinguished the facts of the matter before him from those that confronted the High Court in Barclay and BHP Coal: Endeavour Coal, 187-188 [170]-[172].

112    To that point in time, then—and by as recently as 2018 (see Hall, 381 [101] Tracey, Reeves and Bromwich JJ)—the following relevant principles appeared to have emerged, if not been settled, namely that:

(1)    in a matter alleging unlawful adverse action, the inquiry upon which courts are to embark is to identify the reason or reasons for which the conduct that occasioned it was engaged in;

(2)    that inquiry involves the interrogation of the mental processes of the person or people who engaged in that conduct; and

(3)    circumstances that arise externally to that conduct and those mental processes are irrelevant to that inquiry.

113    Those principles cannot be reconciled with many of the pre-Barclay decisions of this court, including Kodak, Voigtsberger and Pilbara Iron.

114    Nonetheless, the reasoning employed in Kodak—namely, that the states of mind of people other than those whose conduct visits particular adverse action can, in some circumstances, constitute the reasons for which it was taken—has survived. In Construction, Forestry, Mining and Energy Union v Clermont Coal Pty Ltd (2015) 253 IR 166 (hereafter, “Clermont Coal”), Reeves J, after referring to Kodak, made the following observations (at 198 [121]):

…I consider the judgment in Kodak requires me to examine the reasoning process employed by each person whose involvement had a material effect on the ultimate decision. This inquiry does not involve a roving search of the minds of the employees of the kind rejected by Heydon J in Barclay (at [146]). Nor does it involve an objective inquiry of the kind rejected in Barclay (at [44] and [126]), nor import some “unconscious” reasoning to the ultimate decision-maker that was also rejected in Barclay (at [124] per Gummow and Hayne JJ, and [146] per Heydon J). Instead, it focuses on the conscious reasoning processes of those who had a material effect on the ultimate outcome to determine whether their reasoning processes were free of the alleged prohibited reason or reasons. If one or more of the reasons employed by one or more of them was a prohibited reason, that will impugn the ultimate decision. This is what I consider the Full Court meant by “inadvertently” adopting an “undisclosed prohibited reason” in Kodak…

115    Those observations were endorsed by the full court of this court in Australian Red Cross Society v Queensland Nurses’ Union of Employees (2019) 273 FCR 332 (hereafter, “Australian Red Cross”; Greenwood, Besanko and Rangiah JJ). Their Honours there said (at 347-348 [90]-[91]):

The decision of this Court in Elliott v Kodak Australasia Pty Ltd (2001) 129 IR 251 (Kodak) that the absence of a proscribed purpose in the mind of a decision-maker who adopts as his or her starting point the results of an assessment and ranking of an employee by reference to certain criteria performed by others does not foreclose the issue of purpose and a proscribed purpose may still be found where such was the purpose of a person who makes an indispensable contribution to the rankings. Kodak was followed by Reeves J in Construction, Forestry, Mining and Energy Union v Clermont Coal Pty Ltd (2015) 253 IR 166 who (at [121]-[122]) spoke in terms of a person whose reasons had a material effect on the ultimate decision or outcome.

We accept that a person who is involved in the process leading to the decision may be a decision-maker for the purpose of a proscribed purpose, but we do not need to formulate a precise test for the purpose of this case and consider it prudent to refrain from doing so.

116    More recently in Qantas Airways Ltd v Transport Workers’ Union of Australia (2022) 402 ALR 1 (hereafter, “Qantas”; Bromberg, Rangiah and Bromwich JJ), this court had occasion to consider the authorities concerning “…the influence of a proscribed reason held by someone who has had a substantial influence on a decision-maker, and is said thereby to have infected that decision.” Their Honours observed (at 63 [221]) that the effect of Kodak, Clermont Coal and Australian Red Cross is to permit:

…in some circumstances, the use or application by a decision-maker of material infected by a proscribed reason held by someone else involved in the decision-making process in some material way to be taken into account, in order to find that the impugned decision was made for reasons that included that proscribed reason.

117    Their Honours reasoned (at 65 [228]) that there was “…no necessary inconsistency between Kodak or Australian Red Cross on the one hand, and Barclay or BHP Coal on the other.” That conclusion followed some analysis of what the High Court had said in those latter cases. Their Honours took the view (at 64-65 [225]-[226]) that the judgments of both French CJ and Crennan J, and Gummow and Hayne JJ in Barclay left open the possibility that there was “…some role for an identified unconscious contributing reason influencing the decision-maker to be factored into the reasons for the decision itself”; or, otherwise, that it was proper to “…[take] into account the reasons held by other material contributors to the decision-making process as being part of what the employer had to exclude”.

118    Their Honours recognised (at 64 [224]) that Heydon’s J observations in Barclay (above, [105]) “…might be interpreted as being contrary to the reasoning on this topic in Kodak”. They also recognised that French CJ and Kiefel JJ had endorsed those observations in BHP Coal. Their Honours did not, however, refer to what Gageler J said in that case (above, [108]), nor to what Jessup and Perram JJ observed in Endeavour Coal (above, [110]).

119    Respectfully, I am unable to see how Heydon’s J observations in Barclay—which a majority of the court adopted in BHP Coal—might be interpreted otherwise than as contrary to the ratio in Kodak. The idea that there might be “…some role for an identified unconscious contributing reason influencing the decision-maker to be factored into the reasons for the decision itself” (Qantas, [225]) is precisely what the majority of this court accepted in Barclay (see above, [99]) and what the High Court rejected; if not expressly in Barclay, then very clearly in BHP Coal. Indeed, Heydon’s J rejection of it in Barclay was emphatic. His Honour described (at 546, [145]) the idea as “indefensible” and the respondents’ attempt to defend it as one plagued by “extraordinary weakness”: Board of Bendigo Regional Institute of Technical and Further Education v Barclay (No 2) (2012) 248 CLR 549, 553 [9].

120    In my very respectful view, the notion that Heydon’s J remarks in Barclay (above, [105]) “…might be interpreted as being contrary to the reasoning…in Kodak” is something of an understatement. His Honour’s conclusions, like those that emerge from BHP Coal and Endeavour Coal, do not reconcile with Kodak. The former make clear that the relevant inquiry is into, as Perram J put it, “…the state of mind of the decision-maker”. The latter suggests that it might also concern the states of mind of others. One of those propositions must be wrong.

121    The recent (and presently binding) authorities emerging from this court, though, suggest that it is the former. In Wong v National Australia Bank Limited [2022] FCAFC 155 (“Wong”; Katzmann, Charlesworth and O’Sullivan JJ), the full court endorsed (at [25]-[26]) the proposition that emerges from Kodak and Qantas:

…It may be convenient to refer to the person whose conduct directly visited the adverse action on the employee as the “decision-maker” but his or her decision-making process may incorporate the state of mind of other people, including by adopting facts or opinions asserted by them.

…the cases illustrate that a person who does the act or thing constituting the adverse action may act on information or advice the provision or content of which is actuated by a prohibited reason.  The adoption of such information or advice may necessitate the conclusion that the corporation’s reasons for the adverse action include that prohibited reason.  In such cases, it matters not that the person providing the information and advice does not formally possess the authority or power to effect the decision based on the information and advice.  Whether the person performing the act constituting the adverse action is aware that he or she is acting on information or advice given for a prohibited reason may not be relevant in cases of that kind.

122    It is not apparent whether their Honours were there alerted to the observations of Heydon J in Barclay (above, [105]), French CJ, Kiefel and Gageler JJ in BHP Coal (above, [107]-[108]), Jessup or Perram JJ in Endeavour Coal (above, [110]), or Tracey, Reeves and Bromwich JJ in Hall (above, [112]). Regardless, I very respectfully adhere to the position that I articulated in Wong v National Australia Bank Limited [2021] FCA 671, [88]-[96] (Snaden J). That is so despite what is, again with respect, the obvious force inherent in the conclusions that underpin Kodak, Clermont Coal, Australian Red Cross, Qantas and Wong. The search for the reasons animating particular conduct—especially corporate conduct—is (or can be) notoriously difficult. Nonetheless, adverse action inures in conduct—in acts or omissions—in which natural persons engage; and a person (or group of people) can engage in conduct (and, thereby, visit adverse action) because of a reason proscribed by s 340(1) of the FW Act only if that reason operates upon the state of mind with which that person (or group of people) engages in that conduct.

123    But that is not the law as it currently stands. The case law emerging from this court, even after Barclay, BHP Coal, Endeavour Coal and Hall leaves no room for doubt: in assessing the reasons for which conduct amounting to adverse action was engaged in, the court must interrogate not merely the state or states of mind of the person or people who engaged in it; but also that of others whose contribution to that conduct rose beyond some threshold level. That threshold level has been described as “indispensable” (Kodak), “material” (Clermont Coal, Qantas) and “‘significant’, ‘plainly important’, ‘major’, ‘substantial’ or ‘essential’” (Wong).

124    With that analysis complete, the following points of principle can be stated. A respondent may rebut the statutory presumption for which s 361(1) provides by leading evidence as to why it engaged in the conduct that an applicant seeks to impugn. The question for determination starts and ends with whether, in fact, those reasons actuated that conduct. It is not necessary for a respondent to prove that the reasons for which it did as it did were procedurally or substantively fair: Khiani v Australian Bureau of Statistics [2011] FCAFC 109, [31] (Gray, Cowdroy and Reeves JJ). At issue is simply whether they were, in fact, the reasons that animated that conduct.

125    That is an inquiry in two parts: first, were the nominated reasons matters of opinion or belief that formed in the mind of the respondent (or, in the case of bodies corporate, those of its relevant human agents); and, second, did they positively inspire the respondent then to engage in the relevant conduct? If both questions are answered in the affirmative (and if there be no other reasons for which the relevant conduct was engaged in), it is irrelevant that the respondent’s reasons might be impugned as unfair or illogical or otherwise liable to criticism. A claim under Pt 3-1 of the FW Act “…is not a broad inquiry as to whether the applicant has been subjected to a procedurally or substantively unfair outcome”: Ermel v Duluxgroup (Australia) Pty Ltd (No 2) [2015] FCA 17, [48] (Bromberg J).

126    That is not to say, however, that any substantive or procedural unfairness or illogicality inherent in what a respondent nominates as its reasons for conducting itself in any given way are wholly irrelevant. In Wong v National Australia Bank Limited [2021] FCA 671 (Snaden J), [83] I made the following observations, which bear repeating now:

In some circumstances, it might be possible to infer from evidence tending to show that a respondent’s opinions were formed wrongly or unfairly—that is to say, inconsistently with fact or in a way otherwise susceptible to some other legitimate criticism—that those opinions either were not, in fact, formed or did not relevantly actuate the respondent’s conduct (or both). Such circumstances might warrant the rejection of the respondent’s evidence as to why it did what it did and a finding that the respondent failed to rebut the presumption established by s 361 of the FW Act. But, regardless, the inquiry remains: did the respondent form the views that it said that it formed; and, if it did, was it actuated to conduct itself in the way that it did on account of them (and not on account of any proscribed reason)?

127    Similarly, where the reasons for which a respondent claims to have conducted itself were formed in consequence of a process that was tainted by obvious or significant shortcomings, that too might, in the right circumstances, ground a finding that they did not, in fact, form in the mind or minds of those who effected—or substantially or indispensably or significantly or materially contributed to—the conduct, and/or did not, in fact, actuate or partially actuate it…………………..”

 

Serpanos v Commonwealth of Australia [2022] FCA 1226 per Snaden J delivered 18 October 2022