Managing Employment Law Issues

In Offshore Contracting Relationships

PresenterNicholas Ellery

Partner, Corrs Chambers Westgarth

6283672/9March 2015

AGENDA

March 2015

What to do when a client insists you terminate an employee

Fitness for work and misconduct issues

Bullying and mental health issues

Complying with contractual and legal obligations

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SECTION 1:WHAT TO DO WHEN A CLIENT INSISTS YOU TERMINATE AN EMPLOYEE

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YOUR RELATIONSHIPS

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TERMINATING EMPLOYEES

• Client demands, wants and needs

• Demands of the particular project

• Employee availability

• Other deployment possibilities

Practical Issues

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TERMINATING EMPLOYEES

• Unfair dismissal claims

• Adverse action claims

• Issues with redundancy and severance payments

• Procedural fairness issues

Legal Risks

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SECTION 2:MANAGING MISCONDUCT AND FITNESS FOR WORK

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MISCONDUCT AND FITNESS FOR WORK

March 2015

• Drug and alcohol abuse• Obesity

• Disciplining staff

• Dishonesty

• Pre-existing medical issues

• Health and safety

• Client expectations

Practical Issues

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MISCONDUCT AND FITNESS FOR WORK

March 2015

• Unfair dismissal allegation

• Discrimination complaint

• Issues with procedural fairness

• Workers’ compensation

• Breaching contractual obligations to client

• Health and safety laws

Legal Risks

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DRUG USE

Toms v Harbour City Ferries Pty Ltd [2014] FWC 2327

Ferry collided with Wharf. Master’s blood test proved

positive for marijuana. Company had zero

tolerance policy.

Harbour City Ferries suspended Master without pay, then

terminated him a month later.

Deputy President of FWC held that there was

a valid reason but the dismissal was unfair due

to factors under s. 387(h).

FIRSTI

NSTANCE

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DRUG USE

Toms v Harbour City Ferries Pty Ltd [2014] FWC 2327

March 2015

Full Bench of FWC found that the mitigating factors

were not factors that addressed the core

issue.

The dismissal was not unfair as there was

deliberate disobedience by a senior employee of

a significant policy.

Decision quashed. Toms application

for relief dismissed.

APPEAL

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ALCOHOL USE

Dowling v Atwood Oceanics Pacific Limited [2011] FWA 1934

March 2015

• Dowling employed by Atwood as an Assistant Barge Engineer onboard an

offshore rig.

• Rig leased to various oil and gas clients. At this stage was leased to BHP.

• Dowling directed to attend BHP induction. Consumed alcohol at one of the

functions at the induction.

• Attended medical next day where alcohol was detected in urine sample.

• Zero tolerance policy: Dowling dismissed due to breaching Drug & Alcohol policy.

• Dowling argued that as he was not under the influence of alcohol and was not

performing any work related duties, the dismissal was harsh.

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ALCOHOL USE

Dowling v Atwood Oceanics Pacific Limited [2011] FWA 1934

Commissioner Williams held that the policy was reasonable in the circumstances, and as Mr Dowling held a responsible leadership role in Atwood’s operations it was not harsh, unjust or unreasonable for him to be dismissed.

March 2015

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DISHONESTY

Pereira v Toll Energy Logistics Pty Ltd [2014] FWC 3398

March 2015

P worked as Fuel Terminal Officer on the Gorgon LNG

Project on Barrow Island

P sustained minor injury while

undertaking task.

P failed to sign on the T65 JHA prior to commencing task.

Did so retrospectively under the direction of

Safety Advisor.

The next day the Safety Advisor told P

‘everyone knew’ they’d backdated the

forms.

P then removed signature and date, and later resigned and dated the form

with the original date.

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DISHONESTY

Pereira v Toll Energy Logistics Pty Ltd [2014] FWC 3398

Toll undertook investigations, confirming that P had backdated signatures.

Toll dismissed P for serious misconduct in dishonestly backdating a critical safety document.

P submitted unfair dismissal claim.

Held: failure to comply with the safety procedures was a valid reason.

March 2015

WHAT WE CAN LEARN FROM THIS

• Zero tolerance policies are looked upon favourably by the Commission and courts, so long as they are reasonable in the circumstances

– Offshore oil and gas sites are hazardous, so policies generally reasonable

– Make sure they are administered fairly

– Make sure the policies are known to all staff

Administration

Fairness

Reasonable

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SECTION 3:BULLYING AND MENTAL HEALTH ISSUES

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MENTAL HEALTH OFFSHORE

March 2015

• Isolated environment• Technology and connectivity issues• High compression rosters• Fatigue• Inadequacy of psychiatric support• Negative stigma and culture of mental

illness

Practical Issues

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MENTAL HEALTH OFFSHORE

• Workers’ compensation claims• Adverse action complaints• Negligence actions (from both employee

and/or their family)• Orders to stop bullying• Prosecutions

Legal Risks

March 2015

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Cannan and Fuller v Nyrstar Hobart Pty Ltd [2014] FWC 5072

March 2015

Two workers accused manager of bullying

Investigation revealed employee’s, Cannan and Fuller’s,

bullying behaviour

There had been no disciplinary measures

or performance reviews

Nyrstar HR had full knowledge of the

worker’s behaviour but hadn’t acted

Nyrstar asked Cannan and Fuller to attend ‘show cause’

meetings

Nyrstar terminated employee’s after

meeting

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Cannan and Fuller v Nyrstar Hobart Pty Ltd [2014] FWC 5072

March 2015

Deputy President Wells ‘The failure of Nyrstar to deal with those matters effectively and efficiently created significant pressure within the workplace, which festered and fed, in my

view, an environment of little respect on either side’

Though Nyrstar did have a valid reason to sack the employees because of bullying, its failure to deal with any of the conduct complained of in a contemporaneous manner meant that the workers didn’t have a chance to change their behaviour, making their dismissals

unfair.

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MENTAL HEALTH OFFSHORE

102,000 workers in WA resources sector, 67,000 in

isolated environments

Men most likely to experience symptoms of depression when aged

between 25 – 44 years of age.

Depression is among the largest single causes of

disability worldwide (11%)

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SECTION 4:BALANCING LEGAL AND CONTRACTUAL OBLIGATIONS

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Might get a request for information from:

• Safety regulator,• Royal Commission,• Police,• Workers’ compensation body in relation to a workplace injury or

death.

You will need to consider:

• Your legal rights and obligations,• Your contractual obligations with your client,• How you will be able to fulfil your legal rights and obligations, while

also keeping your client happy.

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SCENARIO

• Your company receives a notice or subpoena to produce documents to a

Court regarding a contract dispute between other parties.

• This letter notifies you that, pursuant to the rules of the Court, you must

not refuse or fail to produce a document or other thing that you are

required to produce.

• Contract – Contains express obligations

• You clearly have conflicting obligations – what do you do?

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SCENARIO

• ‘The Contractor shall use the Confidential Information for the sole purpose of

providing the Services and shall not otherwise use the Confidential Information

whether directly or indirectly or in any way or profit from its use whether during or

after the term of this Agreement, unless such information becomes available in the

public domain through no action of the Contractor or the Contractor is required by law

to disclose the information.

• The Contractor undertakes to treat as strictly confidential and not to divulge to

any third party any of the Confidential Information without the Principal’s prior

written consent’

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FINDING THE BALANCE

March 2015

Obligations

Ultimately, the Court, a Royal Commission or similar body will usually have authority to obtain the document

RightsEnsure the agency seeking the information has the power to do soSeek consent from your client

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QUESTIONS?

Nicholas ElleryPartner

nicholas.ellery@corrs.com.auTel +61 8 9460 1615Mob 0417505613Fax +61 8 9460 1667www.corrs.com.au

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