News & Insights

In an important decision for employers, the Court has determined that an employer, having deducted wages from an employee for ceasing work ahead of union-organised stoppages, was not in breach of the Fair Work Act.

The Court ruled in the employer’s favour, despite the employee’s claim that actions such as turning off equipment and ensuring the safety of the site were implicitly authorised by the employer.

shutting down and “making safe” not protected industrial action

The employee in this case, was authorised to engage in three different periods of union-organised stoppages of work.

A memorandum was distributed by the employer to all employees in the days prior to the first organised stoppage. The memo stated that all participating employees must “work as normal right up to the scheduled start of the stoppage” and “if protected action is called for 8am and finishes at 10am, [employees] must continue to work until 8am and be back in the PSI room by 10am”.

Approximately 5 to 10 minutes before the notified commencement time of each stoppage, the employee took steps to make the site safe before leaving the site. The actions included, turning off and parking his dozer, logging out of the work system, and walking to the delegated pick-up area.

court decides deduction in pay not in breach of FWA

On the basis that these actions all occurred prior to the periods of protected industrial action, in accordance with section 474(1) of the Act, the employer deducted four hours’ pay from the employee for each day the conduct occurred.

The Court determined that it is was clear the protected industrial action was to only occur during the notified start and finish times.

All parties agreed that on any normal working day, the actions taken by the employee to cease work and make the site safe would not have typically occurred until the end of his shift. However, the employee argued that, although the steps were usually reserved for the end of a shift, they were implicitly authorised by the employer to occur prior to stoppage, as it was similar in nature to the end of a shift.

In this case, the relevant key points of the decision in favour of the employer were:

1. the memorandum clearly stated that work must continue as normal right up until the stoppage was scheduled to commence;
2. it was most relevant to compare the work the employee would have usually performed during those periods, without any protected industrial action, against the work that he actually performed during such period; and
3. the employee had performed his work at the relevant times in a manner that was different from the way it was customarily performed. As a result, the employee was taking unprotected industrial action prior to the authorised periods of protected industrial action.

key takeaways

Employers should be mindful of the wording of any direction to its workforce regarding taking protected industrial action. Careful evaluation of the usefulness or otherwise of issuing such directions should be part of any wider industrial relations management strategy.

Employers have the right, and more importantly, a general obligation not to pay for periods of time that are not protected industrial action or risk being exposed to civil penalties.

Whether an employee is directed to work as normal until the action commences or is directed to secure a site prior to the action, will ultimately impact which actions are considered protected.

If you would like further information in relation to the impact of this decision on future operations at your workplace, please contact our Employment, Safety and Migration team.