Legal Insights

Bullying: an update on 'reasonable management action'

By Catherine Dunlop

• 18 May 2015 • 4 min read
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The Fair Work Commission has addressed the exception to bullying by examining what is meant by ‘reasonable management action’

The decision of the Fair Work Commission (Commission) in Amie Mac v Bank of Queensland Limited and Ors [2015] FWC 774 addresses the exception to bullying by examining what is meant by 'reasonable management action'.

The Commission considered that an employer's failure to have a documented performance management policy will be unsatisfactory, but it will not be unreasonable (and therefore not bullying) if the process followed is standard in the context of that workplace, or is otherwise reasonable.

What was Ms Mac's claim

Ms Mac was a solicitor at Bank of Queensland (BOQ). Over the course of a few years, her managers had increasing concerns about her performance. They attempted to address these concerns in several bi-annual 'Performance Development Assessments' but her performance did not improve.

Eventually, Ms Mac was put on a Performance Improvement Plan (PIP), and it was explained to her that the process could result in dismissal following the issue of three separate warnings. Relevantly, while BOQ had a performance management policy which referred to a general 'performance management process', it did not mention the PIP process.

After being placed on the PIP process, Ms Mac's performance did not improve. Her manager decided to issue her with a written warning and scheduled a meeting to discuss this. Before the meeting took place, Ms Mac went on sick leave due to stress.

She then lodged an application for an order to stop bullying. BOQ claimed the conduct complained of by Ms Mac was reasonable management action carried out in a reasonable manner.

Relevant law

Under the Fair Work Act 2009 (FW Act), a worker is 'bullied at work' if, while the worker is at work, an individual or group of individuals:

  • repeatedly behaves unreasonably towards the worker, or a group of workers of which the worker is a member, and
  • this behaviour creates a risk to health and safety.

A worker may make an application for an order to stop bullying if the worker reasonably believes that he or she has been bullied at work.

The FW Act states, however, that 'reasonable management action carried out in a reasonable manner' does not constitute bullying.

Findings of the Commission

Vice President Hatcher discussed the meaning of:

  • 'reasonable belief' of the worker in making the application
  • 'unreasonable behaviour' in the definition of bullying
  • 'reasonable management action'.

Ms Mac was found to have reasonably believed she had been bullied at work. Vice President Hatcher gave a wide meaning to the phrase 'reasonably believed' – that is, the belief:

  • must be actually and genuinely held by the relevant person
  • must be reasonable in the sense that objectively speaking there must be something to support it, or some other rational basis for holding the belief, and that it is not irrational or absurd.

Vice President Hatcher gave a narrow meaning to the phrase 'unreasonable behaviour'. For behaviour to be 'unreasonable', it was held that it must be lacking in any evident and intelligible justification.

In the circumstances, it was held that the actions of BOQ, in placing Ms Mac on the PIP process and the manner in which the process was conducted, were not unreasonable given the identified shortcomings in her performance, which had been brought to her attention over a period of time. While it was unsatisfactory (though not unreasonable) that BOQ's performance management policy made no reference to the PIP process, as this meant the process was not transparent to employees, Vice President Hatcher accepted that it was a commonly used process.

Further, Vice President Hatcher noted that Ms Mac did not identify any particular individual as responsible for the alleged unreasonable behaviour, and observed that nothing in the anti-bullying provisions of the FW Act suggested that a corporation could engage in bullying.

Lessons for employers

Employers should note that the Commission, in congruence with the earlier decision of Ms SB [2014] FWC 2104 (see our previous eAlert), does not require management action to be carried out in a faultless manner, in order for it to be reasonable.

The key learnings from this case are:

  • while it is preferable to have a documented and transparent performance management policy, the Commission may still find management action is reasonable in its absence
  • employers must be able to justify their use of a performance management process or have some flexibility in their process, and it may be by reference to evidence that the process used was a common practice in the circumstances (as was the case for the PIP process)
  • applicants for an order to stop bullying under the FW Act must specify a particular individual or group of individuals as responsible for the alleged unreasonable behaviour – the wording of the relevant provisions in the FW Act suggests that corporations cannot engage in bullying.

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