On the Case: Issue 24

Bullying can occur in situations involving conduct between parties in commercial arrangements

In this edition of On The Case, Professor Philip Evans, from the University of Notre Dame Australia School of Law, Fremantle Campus, discusses a recent case 1 in which the Fair Work Commission made an order dealing with the timing, subject matter and content of any future emails sent by a Body Corporate Committee Chairman (Mr C) to the director (Ms A) of a company (B Pty Ltd) engaged to provide management services to a residential complex. The Commission made the order after determining that the behaviour of Mr C was unreasonable and constituted bullying under the provisions of section 789FC of the Fair Work Act 2009 (Cth).

This novel decision extends the jurisdiction of workplace bullying laws outside the traditional employment relationship to include employees of a third-party contractor. Whilst a worker is normally considered as an individual who performs work essentially as an employee, the Commission was satisfied that Ms A, as a company director, was a worker subject to the protection of the Act, and had been bullied by emails sent to her by Mr C. The bullying conduct involved Mr C sending emails to Ms A about matters which were not urgent at times that were unreasonable. The bullying conduct also involved the use of sarcastic and derogatory language in the emails in relation to Ms A and was aggravated by the fact that the emails were circulated to other members of the Body Corporate Management Committee. The Commission noted that whilst many of the emails sent by Mr C dealt with issues which were reasonable for Mr C to raise in his capacity as Chairman of the Body Corporate Committee for the residential complex, the manner in which Mr C expressed those issues, and the frequency of his emails was not reasonable.

The principles in this case are not only significant in the context of an employee/employer relationship but also in the context of constitutionally covered businesses including a proprietary limited company, a trading or financial corporation formed within the limits, the Commonwealth, the Commonwealth authority, a body corporate incorporated in a territory, a business or organisation conducted principally in a territory or Commonwealth place. Parties in commercial arrangements and not only employers and managers need to be aware of the difference between reasonable management action taken in a reasonable way, which is lawful, and bullying which is unlawful.

The Fair Work Commission

The Fair Work Commission is Australia's national workplace relations tribunal. It is an independent body with power to carry out a range of functions which not only include the provision of a safety net of minimum conditions and the inclusion of minimum wages in awards, dealing with applications in relation to unfair dismissal but also the resolution of both collective and individual workplace disputes through a range of ADR processes including conciliation, mediation and tribunal hearings. When hearing claims and disputes which are related to the workplace, the Commission makes binding determinations on the matters in dispute.2

The Commission receives its jurisdiction and powers under the Fair Work Act 2009 (Cth). The Act sets out a number of rules and obligations for employees and employers. The purpose of this system is to provide a balanced framework for productive workplace relations in order to encourage national economic prosperity and social inclusion for all Australians. 3

The legal Issues

The legislative provisions dealing with applications for orders to stop bullying are contained in Part 6-4B of the Fair Work Act. Section 789FC states:

789FC Application for an FWC order to stop bullying

  1. A worker who reasonably believes that he or she has been bullied at work may apply to the FWC for an order under section 789FF.
  2. For the purposes of this Part, worker has the same meaning as in the Work Health and Safety Act 2011, but does not include a member of the Defence Force.

    Note: Broadly, for the purposes of the Work Health and Safety Act 2011, a worker is an individual who performs work in any capacity, including as an employee, a contractor, a subcontractor, an outworker, an apprentice, a trainee, a student gaining work experience or a volunteer.
  3. The application must be accompanied by any fee prescribed by the regulations.
  4. The regulations may prescribe:
    1. a fee for making an application to the FWC under this section; and
    2. a method for indexing the fee; and
    3. the circumstances in which all or part of the fee may be waived or refunded.

Section 789FD of the Fair Work Act defines when a worker is bullied at work as follows:

789FD When is a worker bullied at work?

  1. A worker is bullied at work if:
    1. while the worker is at work in a constitutionally-covered business:
      1. an individual; or
      2. a group of individuals; repeatedly behaves unreasonably towards the worker, or a group of workers of which the worker is a member; and
    2. that behaviour creates a risk to health and safety.
  2. To avoid doubt, subsection (1) does not apply to reasonable management action carried out in a reasonable manner.
  3. If a person conducts a business or undertaking (within the meaning of the Work Health and Safety Act 2011) and either:
    1. the person is:
      1. a constitutional corporation; or
      2. the Commonwealth; or
      3. a Commonwealth authority; or
      4. a body corporate incorporated in a Territory; or
    2. the business or undertaking is conducted principally in a Territory or Commonwealth place; then the business or undertaking is a constitutionally-covered business.

Note the exemption in section 789FD(2) above which refers to “reasonable administrative action, taken in a reasonable manner”. The Fair Work Commission Anti- Bullying Bench Book 4 notes;

Persons conducting a business or undertaking have rights and obligations to take appropriate management action and make appropriate management decisions. They need to be able to make necessary decisions to respond to poor performance or if necessary take disciplinary action and also effectively direct and control the way work is carried out. For example, it is reasonable for employers to allocate work and for managers and supervisors to give fair and constructive feedback on a worker's performance. These actions are not considered to be bullying if they are carried out in a reasonable manner that takes into account the circumstances of the case and do not leave the individual feeling (for example) victimised or humiliated.

Case background

As noted above Mr C was the Body Corporate Committee Chairman of a residential complex and Ms A, together with her husband (Mr D) was the director of a company engaged to provide management services to the complex.

Before continuing it is interesting to note that the Commission issued both the orders and the decision without identifying the parties involved. Deputy President Asbury held. 5

I have done so on the basis that it will be more conducive to the resumption and continuation of on-going safe and productive working relationship between Ms A and Mr C. I am also satisfied that the identification of the parties would also result in the identification of the complex, which may impact other residents. In this regard Ms A and Mr C should note that conflict of the kind dealt with in this decision could adversely affect their own interests and those of others in terms of the values of properties in the complex.

In her complaint to the Commission, Ms A listed a number of instances relating to behaviour by Mr C that she alleged constituted bullying. In particular most of the alleged bullying behaviour occurred in connection with the sending of excessive and continuous emails by Mr C. Additionally Ms A alleged that Mr C tried to blame the manager for a range of issues with the complex and had interfered unreasonably in the letting activities conducted by the manager.6

Before considering the allegations the matter of the jurisdiction of the Fair Work Commission to determine the matter had to be addressed. The Commission noted while carrying out the work associated with the manager’s role at the complex, Ms A was working in a constitutionally covered business for the purposes of section789FD.  Consequently the emails sent by Mr C in his role as chairman of the Body Corporate Committee to Ms A were directed to Ms A in her role as a company director who was working in a constitutionally covered business.  This was irrespective of the location where Ms A received and read the emails.7

In her complaint Ms A listed 11 allegations against Mr C, alleging that these occurred on numerous occasions and were also ongoing issues. The Commission noted that many of the issues which generated the dispute occurred because of competing interpretations of the management agreement which governed the relationship between the management company (B Pty Ltd) and the Body Corporate Committee for the Complex and of the role and responsibilities of the manager under the agreement.8

Mr C responded to the allegations on the basis that his conduct was reasonable management action taken in a reasonable way. Additionally, Mr C claimed that his actions were in response to Ms A failing to comply with her responsibilities under the Complex services management agreement.9

Both parties were self-represented.  Ms A gave evidence on her own behalf and also filed a large volume of supporting material, largely consisting of copies of emails and photographs as evidence of the allegations of bullying conduct. Her husband, Mr D also gave evidence in support of Ms A’s allegations. The evidence of Ms A and Mr D was given with the assistance of a Mandarin interpreter. Mr C also gave evidence on his own behalf filing a written response to Ms A’s application and also tendering a large volume of documentary evidence. 10

The allegations

For the purpose of this case note, only the issues relating to the bullying allegations and unreasonable conduct will be discussed.  Details of all of the allegations, which are discussed in some length, may be found in paragraphs 28 to 76 of the Commission decision. Specifically with respect to unreasonable and bullying behaviour, Ms A alleged;

  • Mr C said to her at a committee meeting in a threatening manner; "I will give you a big boom".  Ms A said that she felt threatened and insulted by this language and reported the incident to the strata manager, the body corporate committee and to the police.11
  • Mr C sent emails to Ms A that she perceived as insulting and abusive, and made unreasonable requests regarding tasks outside of her responsibilities; and
  • Mr C responded to her requests to organising repairs and maintenance in an aggressive and abusive manner.

The decision

Deputy President Asbury stated that after considering the evidence (which as noted above consisted significantly of numerous lengthy emails) that he was;  “satisfied that Ms A’s performance as a manager or a director of the entity providing management services to the Complex leaves much to be desired.”12 It was further noted that Mr C had a number grievances with Ms A which had a valid basis and whilst  Mr C had sent a large number of emails to Ms A, she had not hesitated in responding and “sent an equally large number of emails to Mr C. In short, Ms A is not entirely blameless in the situation which currently exists with respect to her relationship with Mr C.” 13

Nevertheless, as noted in the same paragraph, whilst it was determined that “the majority of issues raised by Mr C were reasonable, the manner in which he has raised them, and the frequency of his complaints, was not reasonable”. Specifically Deputy President Asbury stated:

Mr C has engaged in a practice of sending emails to Ms A at times which are significantly outside the core hours during which the manager is required to be contactable. While I accept that the manager should be contactable at any time in the case of an emergency, none of the issues in these emails are of an emergent nature. Mr C has also used sarcastic and derogatory language in his emails to Ms A and has published those comments to other body corporate committee members. In this regard Mr C has sent emails referring to Ms A as a liar and has made comments about her credibility, her ability to perform the work under the contract and her command of English. This conduct is unreasonable, is repeated and I accept Ms A’s evidence that it is creating a risk to health and safety by affecting her personal wellbeing. I am also satisfied that there is a risk that this behaviour will continue. 14

With reference to Mr C engaging in debate with Ms A about the remuneration payable under the management agreement DP Asbury noted that there were “appropriate mechanisms and processes to resolve such disputes than a war engaged in by email”.  The emails were not an appropriate mechanism to deal with the issue of the remuneration payable under the management agreement and further “Mr C’s raising of this issue in emails to Ms A was unreasonable behaviour which is repeated and is creating a risk to health and safety by affecting Ms A’s personal wellbeing.” 15

Subsequently the orders made by the Commission related to the timing, subject matter and content of any future emails sent to Ms A by Mr C and required that Mr C was to attempt to contact Ms A by telephone before sending an email in relation to a particular issue. Additionally the orders made required that Ms A had to ensure that Mr D, who was also a director of the management company, had a mobile telephone so that he could be contacted by members of the body corporate committee and residents of the complex in accordance with the management agreement. 16

Why this decision is important

The decision is significant firstly because the Commission determined that it had jurisdiction where the complainant Ms A was a company director and not just an individual providing services or an employee. By finding that Ms A was a worker who was owed duties by the Body Corporate of the Complex, it has expanded the extent of the anti-bullying provisions in the Fair Work Act to go beyond a standard employment relationship so that these provisions now not only apply to individual employees and third party contractors as individuals, but additionally to directors of third party constitutionally covered businesses.17

The case also highlights the problematic issues arising from the extensive use of emails between disputing parties. As noted above, a large number of email messages were submitted in evidence by both parties.  Like most statutory tribunals the Commission is not bound by the rules of evidence and procedure in relation to a matter before it.18 The Deputy President appears to have accepted evidence with respect to the truth of what was contained in the email texts particularly as the emails were sent by the two parties and the contents did not appear to have been disputed by either party.

The question of whether administrative action is reasonable and taken in a reasonable manner is one of fact. Whilst a tribunal might be critical of aspects of an employer’s conduct, it does not look for perfection in management.19 A tribunal will consider all of the specific incidents and the respective individual’s behaviour in determining whether the subsequent administrative action is reasonable but it will not examine every decision in order to determine if those decisions could have been made differently or better.

Even though the Commission determined that it was reasonable for Mr C to raise many of the issues in dispute, the manner in which it was done constituted bullying as defined in the Act. It was not reasonable for him to frequently send Ms A emails outside of normal business hours, which contained sarcastic, abusive, threatening, intimidating and derogatory or offensive language.

Mr C would have had a better defence, based on reasonable administrative action, to the bullying allegations if his responses to and communication with Ms A had been undertaken in normal business hours, the contents of any communication were delivered respectfully and within reasonable time frames.

It does not need authority to say that email communication is the most widely used business communication system today. Clearly the importance and uses of email in business communication are greater than any other communication means. However this decision emphasis the principle that it is of critical importance to ensure that in composing an email, persons adopt the same degree of integrity and care that they would use in any other business document. As noted above the Commission had no issue with the admission of the emails as evidence and gave significant weight to the content of the respective emails.

The decision also emphasises that emails may not be the most appropriate way of raising contentious issues or resolving differences or disputes.   For example the Commission found that whilst it was reasonable for Mr C to raise issues relating to the remuneration payable under the management agreement, “email communication was not an appropriate mechanism to resolve the dispute” and another process should have been used.20

1Application by Ms A [2018] FWC 4147.
2 See https://www.fwc.gov.au/disputes-at-work/how-the-commission-works.
3 See https://employsure.com.au/guides/fair-work-australia/what-is-the-fair-work-act/.
4 See https://www.fwc.gov.au/anti-bullying-benchbook/when-worker-bullied-at-work/reasonable-management-action. See also Green and Comcare [2018] AATA 1266 for a discussion of reasonable administrative action.
5 Application by Ms A [2018] FWC 4147 [99].
6 Ibid [3].
7 Ibid [4].
8 Ibid [6].
9 Ibid [5].
10 Ibid [7].
11 Ibid [28].
12 Ibid [84].
13 Ibid [89].
14 Ibid [90].
15 Ibid [92].
16 Ibid [97].
17 A constitutionally covered business is a proprietary limited company, a foreign corporation, a trading or financial corporation formed within the limits of the Commonwealth, the Commonwealth, a Commonwealth authority, a body corporate incorporated in a territory, a business or organisation conducted principally in a territory or Commonwealth place. It does not include sole traders.
18 Fair Work Act 2009 s 591.
19 Nguyen and Comcare (Compensation) [2018] AATA 1623, [63].
20 Application by Ms A [2018] FWC 4147 [95].