Principles
48In Lee (No 2), in considering s 210(1), the Full Bench observed at [23] and [24]:
[23] However, the Commissioner did not consider which employee was the appropriate employee that should have been redeployed, if at all, and why the other two employees, being Mr Newbery and Mr Kelly, should not have been chosen for redeployment (or for that matter why the employer did not address that question).
[24] The reverse onus provision, in our opinion, required that the respondent demonstrate that the safety issue which led to the complaint was not an actuating reason for the appellant's redeployment. The employee had the benefit of the assumption that she had been redeployed because she made the complaint and therefore the onus is on the employer to establish that that was not the reason. To merely establish on the evidence that it was necessary to redeploy one employee leaves open the possibility that this employee was chosen for the reason of her complaint, particularly when that complaint was made at a time coincident with the transfer. Further, the evidence was that many months later at the hearing, two persons were still working in the section.
49In Lee (No 4), in discussing s 210, the Full Bench observed at [10] to [12]:
[10] The respondent bears the onus of rebutting a statutory presumption that the appellant was victimised by the redeployment.
[11] Section 210(2) is Parliament's recognition that the reasons for detrimental action against an employee are, of necessity, peculiarly within the knowledge of the employer. Therefore, to avoid liability the employer must negate the statutory presumption that its conduct has been for the reasons condemned by s 210(1): Heidt v Chrysler Australia Limited (1976) 13 ALR 365 at 373. The statutory imposition of the reverse onus is not a technical requirement; it serves the important public interest of ensuring that justice is done and that the legislative prescription is not defeated by the inability of an applicant to adduce evidence upon a central issue.
[12] In the earlier proceedings before the Commissioner, the respondent had the opportunity of adducing all evidence that it considered relevant to the claim being advanced by the appellant including the reasons for its actions against the appellant. It had also been given the opportunity to make such submissions it considered relevant in relation to the claim. There was nothing in the reasons of the Full Bench decision to suggest that the Full Bench expected that additional evidence would be received. The Full Bench's conclusion was simply that the reverse onus issue had not been addressed by the Commissioner. The granting of leave to adduce that further evidence was not a formality. It was incumbent upon the party now seeking to adduce further evidence to explain how the omission at first instance occurred.
50In this appeal, both parties relied upon a recent decision of the High Court of Australia in Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012] HCA 32; (2012) 290 ALR 647; (2012) 86 ALJR 1044; (2012) 220 IR 445, where the High Court considered s 346 of the Fair Work Act 2009 (Cth) ('the FW Act') which prohibits an employer from taking adverse action against an employee because that employee is an officer or member of an industrial association or because that employee engages, or proposes to engage, in particular kinds of industrial activity (see at [1] per French CJ and Crennan J).
51The judgment of the High Court also considered the statutory presumption found in s 361 of the FW Act. That section is in the following terms:
Reason for action to be presumed unless proved otherwise
(1) If:
(a) in an application in relation to a contravention of this Part, it is alleged that a person took, or is taking, action for a particular reason or with a particular intent; and
(b) taking that action for that reason or with that intent would constitute a contravention of this Part;
it is presumed, in proceedings arising from the application, that the action was, or is being, taken for that reason or with that intent, unless the person proves otherwise.
(2) Subsection (1) does not apply in relation to orders for an interim injunction.
52Similar protections have existed in Federal industrial relations legislation in Australia since the enactment of the Conciliation and Arbitration Act 1904 (Cth) (per French CJ and Crennan J at [1]).
53Mr Trew submitted that the following principles may be extracted from Barclay.
54Firstly, the test of whether action was because of a proscribed reason was neither a subjective nor an objective test.
55Secondly, direct evidence of the decision-maker as to the state of mind, intent or purpose, will bear upon the question of why adverse action was taken. It is, therefore, appropriate for the decision-maker to give evidence comparing the position of the employee affected by the adverse action with an employee who has, for example, no union involvement.
56Thirdly, direct evidence from the decision-maker which is accepted as reliable is capable of discharging the burden on the employer, even though the employee may be an officer of an industrial association and engaged in industrial activity.
57Fourthly, it is wrong to enquire into the "unconscious" state of mind of the decision-maker.
58Fifthly, the question is whether the asserted proscribed reason is a "substantial and operative" reason for taking the adverse action (at [46] to [58], [102], [103] and [127]).
59Mr Darams relied upon the observations of French CJ and Crennan J at [43] in Barclay to the effect that "a defendant employer interested in rebutting a statutory presumption similar in effect to s 210(2) can be expected to rely in its defence on the direct testimony of the decision-maker's reason for taking the detrimental action".
60It was submitted that their Honours (at [45]), in considering the evidence which is capable of rebutting an employer's reverse onus, relied upon Purvis v New South Wales [2003] HCA 62; (2003) 217 CLR 92, as support for the proposition that the direct evidence of the decision-maker as to their state of mind, intent or purpose will bear upon the question of why certain action was taken. Further, it was contended that the reference to Purvis referred to by their Honours was the same part of that decision which a Full Bench of this Commission relied upon in Twentieth Superpace Nominees Pty Ltd (t/as Specialised Container Transport) v Transport Workers' Union (NSW) [2006] NSWIRComm 218; (2006) 156 IR 323. French CJ and Crennan J in Barclay, held that direct evidence from the decision-maker which is accepted as reliable is capable of discharging the burden on an employer.
61Mr Darams further submitted it was also manifest from the joint judgment of Gummow and Hayne JJ (at [127] and [131]) and Heydon J (at [140]) in Barclay their Honours considered that evidence of the decision-maker was relevant to assessing whether an employer had rebutted a statutory resumption similar in effect to s 210(2) of the Act.
62Some attention was given in the written submissions of the appellant as to whether the judgment in Barclay should result in a conclusion that a judgment of the Full Bench in Bindaree Beef Pty Ltd v The Australasian Meat Industry Employees' Union, Newcastle and Northern Branch on behalf of Riley [2012] NSWIRComm 74 was wrongly decided because the Full Bench had limited the operation of a similar statutory presumption to objective circumstances rather than a subjective reason for undertaking a particular step. That submission was not pursued during oral submissions because of the common reliance by the parties upon the decision in Barclay and, in particular, the emphasis both counsel placed upon the direct evidence of the decision-maker as to his state of mind, intent and/or purpose.
63We do not propose, in those circumstances, to further consider the decision in Bindaree Beef. That matter concerned an application brought under s 242 of the Workers Compensation Act 1987 seeking the reinstatement of a dismissed injured worker. The matter revolved around a consideration of Pt 8 of the Workers Compensation Act and, in particular, the statutory presumption found in s 244 of that Act. The statutory scheme is different to that presently under consideration. Whilst the Full Bench in Bindaree Beef did consider a number of judgments broadly concerning victimisation of or adverse action against an employee for a prohibited reason, the Full Bench was not seized of the High Court decision in Barclay. (The Full Bench relied, in fact, upon the majority decision of Gray and Bromberg JJ in Barclay v Board of Bendigo Regional Institute of Technical and Further Education (2011) 191 FCR 212; 274 ALR 570; [2011] FCAFC 14 which was overturned by the High Court in Barclay.)
64There are differences between the statutory schemes concerning adverse action matters under the FW Act and the provisions of Pt 1 of Ch 5 of the Act here under consideration. In particular, there are differences between the form of the statutory presumption in s 361 of the FW Act and s 210(2). (For example, French CJ and Crennan J in Barclay placed reliance upon the words 'particular reason' found in s 361(1)(a) which do not appear in any relevantly similar way in s 210(2).) However, in our view, the parties' reliance upon the judgment in Barclay is well founded, at least to establish the proposition that it will be necessary, in adjudicating upon matters brought under Pt 8 of Ch 5 of the Act, to consider the direct evidence of the decision-maker as to their state of mind, intent and purpose (assuming such evidence was brought by the respondent to the proceedings seeking to rebut the statutory presumption). Having regard to the judgment of French CJ and Brennan J in Barclay (at [44]), that conclusion must follow because of the statutory expression "because" in s 210(1) (see, also, the judgment of Gummow and Hayne JJ at [101]) and the nature of the statutory presumption in s 210(2). As their Honours observed:
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?".
65It follows that we will be guided by the judgment in Barclay in reaching our conclusions in this matter. We note, in that respect, that we find no disagreement with Mr Trew's summary of relevant principles from Barclay, which we have earlier referred to in this decision. Bearing in mind the differences between the statutory schemes and the matters we are required to have regard to under Pt 8, we consider that it will be useful, in approaching this matter, to extract some parts of the judgment in Barclay which will provide guidance in the present context. First, we wish to refer to the following passages from the joint judgment of French CJ and Crennan J (at [45], [54] to [59], [62] and [63]):
[45] 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[23]. 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[24] 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 even though an employee may be an officer or member of an industrial association and engage in industrial activity[25].
[54] In Pearce, an employee who was a member of an organisation registered under the Conciliation and Arbitration Act 1904 (Cth) was dismissed from his employment. A director of the defendant employer gave evidence that the employee was not dismissed "because of being in a union", but rather because he was dissatisfied with his wages and conditions[40]. A question arose as to whether the director's evidence was sufficient to satisfy the onus cast upon the employer. In deciding that the director's evidence was sufficient, the majority in Pearce recognised that mere declarations of an innocent reason or intent in taking adverse action may not satisfy the onus on an employer if contrary inferences are available on the facts[41]. In the minority, Isaacs and Higgins JJ decided that the director's evidence of his reasons for dismissing the employee did not satisfy the onus because other evidence given by the director had contradicted it. In considering this issue, Isaacs J recognised that it is not possible to "peer into [an employer's] mind"[42]. Equally, it is not possible in a curial process to plumb the depths of "[an employer's] unconscious"[43].
[55] More generally, in Pearce, Isaacs J said of s 9(4) of the Conciliation and Arbitration Act 1904 (Cth) (the then applicable legislative predecessor to s 361)[44]:
"The provision casting the onus on the defendant employer means that the fact that the dismissed employee was a member of an organization must not enter in any way into the reason of the defendant, if he desires exculpation."
[56] That interpretation was rejected in Bowling. In Bowling, an employee who was a shop steward was dismissed from his employment. The decision-makers, two directors of the employer, did not give evidence. In a short judgment concurring with Mason J, Gibbs J said[45]:
"The onus of proving that the fact that the employee held the position was not a substantial and operative factor in the dismissal is to be discharged according to the balance of probabilities and is not to be made heavier by any presumption that if an employee who is dismissed for disruptive activities happens to be a shop steward the latter circumstance must have had something to do with his dismissal. If in the present case evidence had been given by the directors responsible that the employee was dismissed because he was guilty of misconduct or because his work was unsatisfactory, and that in dismissing him they were not influenced by the fact that he was a shop steward or indeed that he was dismissed in spite of the fact, and that evidence had been accepted, the onus would have been discharged."
[57] Mason J, with whom Stephen and Jacobs JJ also agreed, said of the interpretation adopted by Isaacs J in Pearce[46]:
"The protection of trade unions and their representatives from discrimination and victimization by employers does not require an interpretation as extreme as that favoured by Isaacs J. It would unduly and unfairly inhibit the dismissal of a union representative in circumstances where other employees would be dismissed and thereby confer on the union representative an advantage not enjoyed by other workers, to penalize a dismissal merely because the prohibited factor entered into the employer's reasons for dismissal though it was not a substantial and operative factor in those reasons."
[58] His Honour went on to say that the decision-makers in Bowling who failed to give direct evidence could hypothetically have said in evidence[47]:
"'We dismissed him because he was a troublemaker, because he was deliberately disrupting production and setting a bad example and we did so without regard at all to his position as a shop steward'."
Because no such evidence was given, his Honour found that the evidence in the case[48]:
"left uncontroverted the possibility that the respondent's position as a shop steward was an influential, perhaps even a decisive, consideration in [the decision-makers'] minds."
[59] Despite the change to a civil penalty regime effected in 1996, s 361 does not differ in relevant respects from its legislative predecessors and Bowling remains authoritative in relation to a number of the arguments raised on the appeal.
[62] Secondly, it is a related error to treat an employee's union position and activity as necessarily being a factor which must have something to do with adverse action, or which can never be dissociated from adverse action. It is a misunderstanding of, and contrary to, Bowling to require that the establishment of the reason for adverse action must be entirely dissociated from an employee's union position or activities. Such reasoning effectively institutes an interpretation of the relevant provisions indistinguishable from that of Isaacs J in Pearce, which was rejected in Bowling. The onus of proving that an employee's union position and activity was not an operative factor in taking adverse action is to be discharged on the balance of probabilities in the light of all the established evidence.
[63] Thirdly, it is appropriate for a decision-maker to give positive evidence comparing the position of the employee affected by the adverse action with that of an employee who has no union involvement.
66We also refer to the joint judgment of Gummow and Hayne JJ (at [85] to [87], [90], [103], [104], [116], [127] and [128]) as follows:
[85] Mason J, with whom Stephen and Jacobs JJ agreed, began his analysis of s 5 by remarking that the section had "a legislative history which extends back to the turn of the century when the trade union was a more fragile institution than it is today and when it stood in need of a large measure of protection from employers"[63]. His Honour went on to say that[64]:
"The protection of trade unions and their representatives from discrimination and victimization by employers does not require an interpretation as extreme as that favoured by Isaacs J [in Pearce]. It would unduly and unfairly inhibit the dismissal of a union representative in circumstances where other employees would be dismissed and thereby confer on the union representative an advantage not enjoyed by other workers, to penalize a dismissal merely because the prohibited factor entered into the employer's reasons for dismissal though it was not a substantial and operative factor in those reasons."
Mason J preferred the construction that[65]:
"[Section] 5(1) does not proscribe the circumstances which it lists as the sole or predominant reasons for dismissal. It is sufficient if the circumstance is a substantial and operative factor. And it does not cease to be such a factor because it is coupled with other circumstances or because regard is had to it in association with other circumstances not mentioned in the section." (emphasis added)
[86] With respect to the onus borne by the employer, Mason J stated[66]:
"Section 5(4) imposed the onus on the [employer] of establishing affirmatively that it was not actuated by the reason alleged in the charge. The consequence was that the [employee], in order to succeed, was not bound to adduce evidence that the [employer] was actuated by that reason, a matter peculiarly within the knowledge of the [employer]. The [employee] was entitled to succeed if the evidence was consistent with the hypothesis that the [employer] was so actuated and that hypothesis was not displaced by the [employer]. To hold that, despite the subsection, there is some requirement that the prosecutor brings evidence of this fact is to make an implication which, in my view, is unwarranted and which is at variance with the plain purpose of the provision in throwing on to the [employer] the onus of proving that which lies peculiarly within his own knowledge."
[87] Turning to the facts of the case, Mason J held[67]:
"Once it is said that the appellant dismissed [the respondent] because he was deliberately disrupting production and was setting a bad example it is not easy to say without more that this had nothing to do with his being a shop steward. Although the activities in question did not fall within his responsibilities as a shop steward his office gave him a status in the work force and a capacity to lead or influence other employees, a circumstance of which the appellant could not have been unaware. It would be mere surmise or speculation, unsupported by evidence, to suppose that the appellant's management, if concerned as to the bad example he was setting, divorced that consideration from the circumstance that he was a shop steward."
[90] In holding that Qantas had not contravened s 5 of the 1976 Act in dismissing Mr Lewis, Morling J assessed the reliability and weight of the evidence adduced by both parties. His Honour made findings that Mr McLean, the dismissing officer, "bore no ill-will to the prosecutor", and that[72]:
"It is significant that McLean did not single out the prosecutor for treatment different from that meted out to Macfarlane, who was not a union delegate and who had not taken any special part in the quarantine dispute. ... I am satisfied that neither Macfarlane nor the prosecutor was unfairly treated. If facts favourable to the prosecutor did not emerge at the interview, that failure was due entirely to his own refusal to say anything in his own defence."
[103] With respect to what became s 346 of the Act, paragraph 1458 of the Explanatory Memorandum to the Fair Work Bill 2008 stated:
"Clause 360 provides that for the purposes of Part 3-1, a person takes action for a particular reason if the reasons for the action include that reason. The formulation of this clause embodies the language in existing section 792 which appears in Part 16 of the WR Act (Freedom of Association) and includes the related jurisprudence. This phrase has been interpreted to mean that the reason must be an operative or immediate reason for the action (see Maritime Union of Australia v CSL Australia Pty Limited[79]). The 'sole or dominant' reason test which applied to some protections in the WR Act does not apply in Part 3-1." (emphasis added)
The phrase "operative or immediate reason" used in CSL is relevantly indistinguishable from the phrase "a substantial and operative factor" used by Mason J in Bowling.
In light of the legislative history of s 346 and the intention of Parliament outlined above, the reasoning of Mason J in Bowling is to be applied to s 346. An employer contravenes s 346 if it can be said that engagement by the employee in an industrial activity comprised "a substantial and operative" reason, or reasons including the reason, for the employer's action and that this action constitutes an "adverse action" within the meaning of s 342.
[116] Before this Court the appellant accepts that it took "adverse action" against the first respondent under s 342 of the Act. On the footing that s 346 applies, the primary issue for determination is whether or not the adverse action was made "because" of a reason proscribed by s 346. No party to the appeal seeks to agitate the findings of fact made by the primary judge.
[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.
[128] Whilst it is true to say, as do the respondents, that there is a distinction between discharging the onus of proof and establishing that the reason for taking adverse action was not a proscribed reason, there is nothing to suggest that the conclusions drawn by the primary judge, and the findings and reasons upon which these were based, did not take this into consideration. As Lander J concluded, if the reasons for the conclusions and the facts for which they were formulated are not challenged, then the contravention of s 346 cannot be made out[103]. This proposition should be accepted. To hold otherwise would be to endorse the view that the imposition of an onus of proof on the employer under s 361(1) creates an irrebuttable presumption at law in favour of the employee.