Unlawful dismissal

The concept of unlawful dismissal in Australian employment law is discussed extensively throughout this web site. However here is an extract from a recent decision of the Federal Court of Australia which deals with some of the elements of the cause of action.

“Was Dr Rumble Dismissed Unlawfully?

I think the answer to this question is no. It is trivial that dismissing Dr Rumble was adverse action within the meaning of s 342 of the Act. Section 340(1) provides:

340     Protection

(1)       A person must not take adverse action against another person:

(a)       because the other person:

(i)        has a workplace right; or

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

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

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

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

A ‘workplace right’ is defined in s 341(1) in these terms:

341     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.

Section 361 places the onus on the Firm to prove that the reason for the adverse action was not a prohibited reason: Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [2014] HCA 41; 253 CLR 243 (‘BHP Coal’) at 248 [6]per French CJ and Kiefel J; 253 [27] per Hayne J; 260 [55] per Crennan J.

Dr Rumble was able to make an inquiry of Ms Miselowski in relation to his employment with respect to his contractual entitlement to an annual 5% uplift. Consequently, it follows that he had a workplace right under s 341(1). However, the Firm has discharged the onus of proving that Mr Martinez did not determine the relationship because Dr Rumble exercised that right as I have explained at [121] above.

I also do not accept that Dr Rumble’s employment with the Firm was terminated because he expressed a political opinion. It is true that s 351 prohibits the taking of adverse action because an employee’s political opinion. Section 351(1) provides:

351         Discrimination

(1)          An employer must not take adverse action against a person who is an employee, or prospective employee, of the employer because of the person’s race, colour, sex, sexual orientation, age, physical or mental disability, marital status, family or carer’s responsibilities, pregnancy, religion, political opinion, national extraction or social origin.

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

But no one at the Firm cared about Dr Rumble’s political opinion about the adequacy of the Government’s response to the 2011 Defence Review. What Mr Martinez (and Mr Will) very much cared about was Dr Rumble’s conduct in criticising the Firm’s clients which they obviously regarded as a threat to its business. He had been directed not to do this and he continued to do so. Whilst the Act proscribes dismissing a person because of their political opinion there may be some issues as to whether the Act thereby also proscribes dismissing an employee for expressing their political opinion.  Mortimer J held in Sayed v Construction, Forestry, Mining and Energy Union [2015] FCA 27; 327 ALR 460 at 493-496 [166]-[177] that it did. I would prefer to express no view about that issue until it is raised squarely for consideration. In this case, I will assume this issue in Dr Rumble’s favour.

However, what that then gives rise to is a question of fact viz whether Mr Martinez terminated Dr Rumble because he was expressing his political opinion or because he was criticising the Firm’s clients in breach of the Firm’s media policy.  No doubt the same actions on Dr Rumble’s part are involved in both cases because his breach of the Firm’s media policy was constituted by his expressions of political opinion.  But so to observe runs the risk of drifting away from the statutory language.  The question is not what Dr Rumble did but rather why Mr Martinez terminated his employment.  Once Mr Martinez’s subjective mental state is identified as the correct focus of inquiry then it is necessarily follows that the fact that the Dr Rumble’s conduct is capable of multiple characterisations (expression of political opinion, breach of the media policy) merely then gives rise to a factual question about which of them was it that actuated Mr Martinez’s thinking.

This orthodoxy of this analysis, although once controversial, is now well-established as BHP Coal demonstrates. In that case, the person responsible for terminating the employee’s employment gave evidence that his reason for dismissing the employee was because he had been waving an offensive sign (with the word ‘scab’ on it) and notbecause the employee was engaged in a lawful protest.  The Court held that that that finding of fact was determinative and that the employee had not been terminated for exercising a workplace right.  That is indistinguishable from the present situation.  Mr Martinez could have decided to terminate Dr Rumble’s employment because he had expressed a political opinion but that is not, as a matter of fact, what Mr Martinez did.  He dismissed Dr Rumble because he disobeyed instructions and a policy not to discuss the Firm’s clients in public without first getting permission.

Ms Francois, counsel for Dr Rumble, sought to distinguish BHP Coal on the basis that in that case the policy did not prevent the expression of the political opinion constituted by the word ‘scab’ outside the context of the workplace. In this case, on the other hand, the particular nature of Dr Rumble’s political opinion as being about the Firm’s clients had the consequence that the policy excluded him from expressing his political opinion at all. I accept that this is a factual difference between the two cases but it does not provide a basis for the distinguishing BHP Coal.  The critical reasoning in BHP Coal is unrelated to that difference and simply requires one to accept that the question of whether action has been taken for a proscribed purpose is a factual one. In that context, whether the policy which explains why the action was taken involved a blanket prohibition of the expression of political opinion or not does not matter. The question remains: why did Mr Martinez dismiss Dr Rumble?

I also reject the submission that the media policy was unlawful because it infringed ss 10(2)(a) and/or (d) of the Discrimination Act 1991 (ACT) (‘the ACT Act’). It provides:

(2)       It is unlawful for an employer to discriminate against an employee—

(a)          in the terms or conditions of employment that the employer affords the employee; or

(d)          by subjecting the employee to any other detriment.

It was submitted that the media policy discriminated against Dr Rumble because it discriminated against him because of his political convictions. Under s 7(o) of the ACT Act the holding of a political conviction is a protected attribute. Under s 8 a person discriminates when they discriminate directly or indirectly on the basis of a protected attribute. So s 10 does outlaw discrimination, whether direct or indirect, on the basis of political convictions. But the media policy does not do this. It requires all employees not to comment adversely on the Firm’s clients. It may be accepted that this involves indirect discrimination against those members or employees of the Firm who have the political opinion that the Firm’s clients should be criticised because it disadvantages them as compared to those who do not. However, the prohibition is a reasonable one having regard to the Firm’s interests in deriving revenue from the performance of legal services for clients by regulating or prohibiting employees from publicly criticising the Firm’s clients. This matters because s 8(4) provides:

8        Meaning of discrimination

(4)          However, a condition or requirement does not give rise to indirect discrimination if it is reasonable in the circumstances.

It is not to the point that in fact Dr Rumble’s activities may not have upset Mr Cunliffe or the Firm’s clients too much.  The legality of the media policy is to be judged at the time of its inception.

Consequently, the media policy does not constitute an act of discrimination against Dr Rumble.

I therefore find as a fact that Dr Rumble was not terminated for having or expressing a political opinion.  Mr Martinez gave evidence to that effect and was extensively cross-examined on this issue.  Although there were reasons to reject other parts of Mr Martinez’s evidence, I am satisfied that this aspect of his testimony was correct.  In truth, Mr Martinez did not care about Dr Rumble’s views on the Government’s implementation of his recommendations to which he was most likely indifferent.  What he did care about was the earning of fees and the elimination of insubordination.

Although it does not arise, I would have rejected the Firm’s alternative contention that it was entitled to dismiss Dr Rumble from its employ because of his political opinion. This contention was premised on the proposition that Dr Rumble’s employment had been terminated in New South Wales because Dr Rumble was in Nambucca Heads when he received Mr Martinez’s email terminating his employment. This was said to be significant because the prohibition in s 351 against taking adverse action against an employee because of their political opinion is subject to an exception that the action is not unlawful under specified anti-discrimination laws in the place where it occurred. That list includes the NSW Act and the ACT Act. The exact terms of s 351(2) are the following:

351     Discrimination

(2)       However, subsection (1) does not apply to action that is:

(a)          not unlawful under any anti‑discrimination law in force in the place where the action is taken; or

(emphasis added)

The NSW Act does not contain a prohibition on discrimination on the basis of political opinion but the ACT Actdoes. Consequently, on one view, if the termination occurred in New South Wales then it may fall within the carve-out in s 351. This turns on the meaning of ‘not unlawful’ and ‘place where the action is taken’ in s 351(2). As this issue does not ultimately arise I will dispose of it briefly.

I do not accept Dr Rumble’s submission that ‘not unlawful’ is limited to actions which are specifically permitted under an anti-discrimination law as opposed to where the relevant anti-discrimination law is silent on the issue. Such a construction does not sit with the plain meaning of ‘not unlawful’. If an action is not proscribed by any anti-discrimination law then plainly the action is not unlawful. Nor does it sit with the supplementary explanatory memorandum to the Fair Work Bill 2008 (Cth), which explained an amendment changing the wording in s 351(2)from ‘authorised by’ to ‘not unlawful’ in the following terms (at [220]):

Paragraph 351(2)(a) of the Bill (together with paragraph 342(3)(a)), currently provide that action is not discriminatory if it is authorised by or under a Commonwealth, State or Territory anti-discrimination law. This exception is intended to ensure that where action is not unlawful under a relevant anti-discrimination law (e.g., because of the application of a relevant statutory exemption) then it is not adverse action under subclause 351(1). The word ‘authorised’ may not capture all action that is not unlawful under anti-discrimination legislation, especially if the legislation does not specifically authorise the conduct but has the effect that the conduct is not unlawful. These amendments ensure the exception operates as intended.

The use of phrase ‘not unlawful’ is expressed to capture actions beyond express statutory exemptions. As dismissal for political opinion is not unlawful under any anti-discrimination law in NSW, I consider that if Dr Rumble had been dismissed in NSW then that action would not have contravened s 351 of the Act.

With respect to the ‘place where the action is taken’, I do not accept Dr Rumble’s submission that this is to be determined according to the proper law of the contract.  The effect of such a construction would mean that parties could potentially contract out of statutory prohibitions against discrimination: see Insight Vacations Pty Ltd v Young[2011] HCA 16; 243 CLR 149 at 160 [31] per French CJ, Gummow, Hayne, Kiefel and Bell JJ, citing Kay’s Leasing Corporation Pty Ltd v Fletcher [1964] HCA 79; 116 CLR 124 at 142-144 per Kitto J. However, neither do I accept the Firm’s submission that the ‘place where the action is taken’ is the place of receipt of the termination notice. That would also produce a result where parties could attempt to avoid statutory prohibitions against discrimination by, for example, terminating employees whilst at a staged interstate work retreat.

The ‘place where the action is taken’ must turn on what the alleged action is. In this case, that action is the termination of the employment relationship between Dr Rumble and the Firm. That relationship is defined by the employment contract but is separate to the contract. Everything about that relationship was centred on the ACT. Dr Rumble’s contract provided that he was responsible to the ‘Partners in the Canberra Office’ and the Firm paid for his Practising Certificate in the ACT. Dr Rumble may have been working from Nambucca Heads in NSW but he was working pursuant to an employment relationship based in the ACT. I therefore find that the place where the dismissal took place in the ACT where the employment relationship was based.

For completeness, I note two final matters.  First, I reject Dr Rumble’s submission that the pleading history of this matter indicates that the dismissal was not for lawful reasons.  Whilst I accept that the media policy only came to light late in this litigation, I do not think it has any bearing on Mr Martinez’s credibility.  Secondly, I note, without expressing any concluded view, that had the case been pursued as a claim for wrongful dismissal under Pt 6-4 Div 2 rather than under the General Protections provisions of Pt 3-1, then the carve-out in s 351 would appear to have no analogue in s 772(1)(f). Of course, both actions cannot be pursued simultaneously (s 723), but the anomaly nevertheless appears idiosyncratic.”

Rumble v The Partnership trading as HWL Ebsworth Lawyers (2019]) FCA 1409 3 September 2019 per Perram J