The High Court has recently found that ‘a reasonable opportunity to respond to adverse material’ under the legislation governing the Victorian Independent Broad-based Anti-Corruption Commission (IBAC) requires an opportunity to respond to the substance or gravamen of the evidentiary material. Further, the use of the term ‘adverse material’ in the legislation meant that IBAC needed to give an opportunity to respond to not just the proposed findings but to adverse comments and opinions, as well.

This case demonstrates what may be required if legislation (or an industrial agreement or workplace or other policies) contains more expansive detail about what the requirement to provide an opportunity to respond means, and how this can extend beyond the common law requirements of natural justice and procedural fairness.

What was the case about?

The case, AB (a pseudonym) v Independent Broad-based Anti-corruption Commission [2024] HCA 10, arose from an investigation conducted in 2019 and 2020 by IBAC into allegations of unauthorized access and disclosure of internal email accounts of a public body.

Following its investigation IBAC prepared a draft special report setting out its findings and recommendations. The draft report contained proposed comments or opinions which were adverse to a registered entity ‘CD’ and its senior officer ‘AB’.

The Independent Broad-based Anti-corruption Commission Act 2011 (IBAC Act) requires IBAC, if it intends to make an adverse comment or opinion about a person in a special report, to provide that person with ‘a reasonable opportunity to respond to the adverse material”. IBAC sought to comply with these obligations by providing a version of the draft report to ‘AB’ and ‘CD’ with all but those parts relevant to them, or which were necessary to provide context, redacted.

The redacted draft report contained the proposed adverse findings along with the reasons for those findings, but ‘AB’ and ‘CD’ claimed that IBAC failed to provide them with a ‘reasonable opportunity to respond to the adverse material’ because IBAC did not provide them with all the evidentiary material upon which the proposed adverse findings, comments or opinions were based.

Ultimately, as the redacted draft report contained the substance or gravamen of the evidentiary material upon which the adverse comments were based, providing an opportunity to respond to the draft report was an acceptable way of satisfying the requirements of the IBAC Act.

What does this mean for natural justice, adverse material and reasonable opportunity to respond?

In determining the correct construction of the relevant provision, the High Court summarised several basic propositions for affording natural justice ‘where a person’s interests are likely to be affected by an exercise of power’. The impacted person:

• must be given an opportunity to deal with relevant matters adverse to [their] interests which the decision maker ‘proposes to take into account;

• does not have to be given an opportunity to comment on every adverse piece of information but should generally be given ‘adverse information that is credible, relevant and significant to the decision to be made’;

• may, in some contexts, need to be given the opportunity to respond to information not expressly relied on, or proposed to be relied on, for example where there is a sufficient risk of prejudice, including subconscious prejudice (citing the High Court in Kioa v West).

The High Court found that the IBAC Act modified ‘the common law obligation to afford procedural fairness’ by requiring a connection between the ‘adverse material’ and the proposed adverse findings, comments or opinions. The High Court found that ‘adverse material’ meant the evidentiary material said by IBAC to justify an adverse comment or opinion, not just the comment or opinion, and that a ‘reasonable opportunity to respond’ to the adverse material would, in most cases, be satisfied by providing an opportunity to respond to the ‘substance or gravamen’ of the evidentiary material.

What should employers do?

The case is important in that it demonstrates that care must be taken to understand what is an opportunity to respond when the obligation extends beyond the common law requirement to provide natural justice.

Employers should ensure that:

• Where they are applying a statutory or similar process to dealing with allegations against employees, they carefully consider the language used in the applicable statute, industrial agreements and/or policies.

• Where the obligation extends beyond the common law, a respondent is given an opportunity to respond to relevant adverse information that a decision maker proposes to take into account.

The position remains that a respondent is not entitled to every piece of information gathered during an investigation but you should generally provide an opportunity to respond to adverse information that is credible, relevant and significant. You should ensure that the substance or essence of the evidence that is relied upon to reach an adverse finding is accurately disclosed for response before any concluded view is formed.