Damages for hurt and humiliation – The added cost of adverse action claims

October, 2014

By Clayton Payne

Can an employee be awarded compensation for hurt and humiliation on the back of a termination of employment?

According to the recent Federal Circuit Court decision in Hall v. City Country Hotel Management Pty. Limited and Others, the answer is “yes”.

In this case, the Applicant was employed as a “glassie” and to clean tables, and was later employed as a bartender. The Applicant later raised issue with the rate he was being paid, claiming in effect, that he was not being paid in accordance with the relevant Modern Award. When the employer responded that the Applicant was being paid correctly as a part-time employee, the Applicant disputed this, saying that he was a casual.

Shortly afterwards, the Applicant’s name was removed from the employer’s work roster.

In subsequent communications, one of the owners of the employer said to the Applicant in an email:

As you are trying to creat[sic] a fair work claim I suggest you priced[sic] with this action ASAP. When I win I will have you pay my costs”.

The Applicant subsequently lodged a complaint in the Fair Work Commission.

In finding that the Applicant was a casual employee, Judge Manousaridis found that the Applicant was a casual employee and was paid less than that to which he was entitled.

It was also found that the employer “prejudiced” the Applicant’s employment. This occurred when the employer effectively terminated, injured or adversely altered the Applicant’s employment, in circumstances where he had made an inquiry “in relation to his …. employment”.

The Applicant was awarded compensation for unpaid wages and superannuation contributions. In addition, he was awarded $2,500 for distress, hurt and humiliation. In this regard, the Applicant gave evidence that as a result of the effective termination of his employment he was “ … absolutely devastatedbecame withdrawn … (and) … suffered from inability to sleep”, etc.

Conclusion

This case highlights the fact that care must be taken when responding to employee enquiries, and in dealing with employees who exercise their “workplace rights”. In these situations, generally a reverse onus of proof will apply, meaning that if an allegation is made against an employer, the employer will be required to prove that any action taken by them was not taken for an illegitimate reason.

Aside also from possible civil penalties which can be ordered against companies and their owners/managers in these circumstances, this case demonstrates that compensation can also be awarded to a successful applicant for the emotional distress that they have suffered as a result of the action.

Contact Mills Oakley

For more information, please contact:

Ross Levin | Partner
Melbourne
T: +61 3 9605 0070
E: rlevin@millsoakley.com.au

Malcolm Davis | Partner
Sydney
T: +61 2 8035 7932
E: mdavis@millsoakley.com.au

Adam Lunn | Partner
Melbourne
T: +61 3 9605 0868
E: alunn@millsoakley.com.au

Lisa Anaf | Partner
Melbourne
T: +61 3 9605 0857
E: lanaf@millsoakley.com.au

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