By Mike Toten Freelance Writer

A Manager transferred from Europe to Australia who behaved disrespectfully and abusively towards his Australian subordinates and was eventually dismissed has lost the majority of his adverse action claim. He claimed he was dismissed because he had made complaints about his employment entitlements and conditions, but the Federal Court found he was dismissed because of his conduct towards the subordinates and upheld only one aspect of his adverse action claim.

Facts of case

The employee was a Director and Sales and Marketing Manager transferred from Europe and Hong Kong to the employer’s Australian subsidiary. He claimed that he found that Australian employees did not have as high a work ethic as the employees he worked with overseas. He became frustrated with that and there was mutual lack of respect between him and his subordinates.

The following conduct occurred:

  • He regularly swore at them in frustration, sometimes aggressively banging his fist on tables.
  • He was critical and insensitive to their personal concerns, and generally regarded as a “hard taskmaster”.
  • He lacked insight into the effect his conduct had on others, and did not take any of their complaints about his conduct on board.

After one employee resigned and contacted the German parent company to claim the Manager had made the workplace “toxic hell”, the parent company sent the email to him, but offered the excuse that there were “cultural differences” between the work ethics of Australian versus overseas employees, and avoided criticising the Manager.

There were other complaints from co-workers, and two others resigned citing the Manager’s aggressive treatment of them, and eventually he was dismissed for misconduct towards them. The termination letter set out his mistreatment of other employees as the reason for dismissal.

Decision

The Court found that the evidence of the employees who had complained and/or resigned was more credible than the Manager’s. It concluded that the Manager’s routine swearing at them, the aggressive manner in which he did it, and the position of power he held over them made it hard for them to call it out. That overrode the fact that it was a “robust” workplace in which employees routinely swore at each other. The Court found no link between the Manager’s complaints and the decision to dismiss him -- the reason for it was misconduct towards co-workers.

The Court rejected his claim that his conduct was reasonable management action, and said that the absence of an anti-bullying policy was not relevant. The nature of his conduct was what mattered most, not whether or not it could be defined as “bullying”. It was still within the scope of “serious misconduct” that justified dismissal. 

The Manager had lodged a claim of adverse action, claiming that he was dismissed because he had made complaints about non-payment of entitlements, breaches of his employment contract and requested salary increases. The Court upheld only one of those complaints, relating to delayed payment of annual leave entitlements. It awarded him general damages of $10,000 for that.

A large part of the judgment dealt with the Manager’s claim that he was forced to work excessive hours on a regular basis. However his claim was rejected, both because he failed to provide sufficient evidence to prove he had worked the claimed hours, and also because he failed to provide evidence that the employer had forced him to work excessive hours.

What this means for employers

In adverse action claims, the onus of proof is on the employer to demonstrate that the decision to take action against an employee (in this case dismissal) was not made for a reason prohibited by the Fair Work Act 2009 (in this case exercising his right to make complaints about his employment entitlements). In this case, the reason for dismissal was misconduct towards co-workers.

Note also that the reason for taking action has to be a “substantial and operative reason”, so it need not be the only reason.

Read the judgment

Dorsch v HEAD Oceania Pty Ltd [2024] FCA 162 (28 February 2024)