Why employers need to follow their internal disciplinary polices and procedures

Written by Belinda Imbriano, Associate, Legal and Workforce

Why employers need to follow their internal disciplinary policies and procedures

The Maher v Workers' Compensation Regulator [2021] QIRC 313 Decision (QIRC Decision) of the Queensland Industrial Relations Commission (Commission) assessed whether a local government employee’s psychological injury arose out of "reasonable management action taken in a reasonable way" by Council. Specifically, the Commission analysed the steps Council took when they suspended the employee from his employment, including whether the employee received prior notice of the suspension meeting and if Council failed to offer the employee an opportunity to have a support person present in accordance with the Council’s Disciplinary Procedure (Disciplinary Procedure).  

This Decision also highlights that a disciplinary process needs to be undertaken in a timely manner, and a lengthy or drawn-out disciplinary process may constitute management action taken in an unreasonable way under the Workers' Compensation and Rehabilitation Act 2003 (Qld) (Act). 

Background  
In May 2018, concerns were raised regarding the employee’s conduct and allegations of breaches of Council’s Code of Conduct and/or Workplace Bullying and Harassment Policy (allegations). The employee was suspended on pay. An external investigation commenced, and a disciplinary process subsequently followed, with some of the allegations found to be substantiated or partially substantiated. Council followed the Local Government Regulation 2012 (LGR) disciplinary action process, and the employee was required to show cause as to why disciplinary action should not be taken against him. The employee claimed he sustained a psychological injury because of Council’s disciplinary process. 

On 2 November 2018, the employee lodged an application for workers' compensation with the Local Government Workcare Scheme on the basis that the show cause letter Council had issued to him seeking a response in relation to the allegations constituted unreasonable management action, taken in an unreasonable way. LGW rejected the employee’s application and concluded

“section 32(5) of the Act operates to exclude a psychological condition from the definition of 'injury' under section 32(1) of the Act ” (LGW decision).

The employee applied to the Workers’ Compensation Regulator to review the LGW decision and the Regulator confirmed the LGW decision (Regulator’s Decision). Subsequently, the employee filed an appeal to the Commission against the Regulator’s decision.

The Commission’s decision  
The Commission set aside the Regulator’s Decision and concluded that Council took reasonable management action against the employee, but it was not taken in reasonable way. Therefore, the employee’s application for compensation under the Act was accepted.  

The Commission reviewed the steps Council took regarding suspending the employee from his employment and found that “there were problems in both the suspension and show cause phases of the process.” These problems included Council failing to provide notice of the suspension meeting to the employee and failing to offer the employee an opportunity to have a support person present. It is important to note that the employee was advised he may have a support person present, but before the purpose of the meeting was revealed to him and only at the commencement of the meeting.

In reaching the above outcome, the Commission analysed Council’s Disciplinary Procedure and found that suspending an employee from their employment with Council was a ‘disciplinary step’ pursuant to the Council’s Disciplinary Procedure. The Commission assessed the purpose of a support person or representative under Council’s Disciplinary Procedure. The Commission found that a support person would not have been offered if the suspension meeting was not considered a step in the disciplinary procedure and according to Council’s Disciplinary Procedure, a support person should properly have been nominated prior to the meeting being held. Accordingly, the Commission concluded that the failure to offer the employee the opportunity for a support person prior to the suspension meeting was unreasonable and was non-compliant with Council’s Disciplinary Procedure.

In addition, the Commission identified that the Notice to Show Cause (Notice) that was provided to the employee failed to properly particularise the allegations made against the employee, particularly the allegations did not state what the employee was in breach of (for example, if the conduct would be in breach of Council’s code of conduct) and that the allegations lacked detail. It was also substantiated that the Notice was provided to the employee before the final investigation report and attachments were provided by the investigator to Council.

Ultimately the Commission found that Council’s failure to adequately particularise the allegations contributed to the finding that despite that Council’s management action was reasonable, it was not taken in a reasonable way under the Act. The Commission also stated that s 283 of the LGR – Employee to be given notice of grounds for disciplinary action, applied to the content of the Notice, in addition to Council’s Disciplinary Procedure. As such, the Commission found that the allegations against the employee and an explanation of the grounds were not provided in a manner compliant with s 283 of the LGR nor Council’s Disciplinary Procedure and issuing the Notice before the final investigation report was provided to Council was neither prudent nor appropriate. However, in relation to the employee’s argument that Council undertook a lengthy and drawn-out disciplinary process, the Commission did not agree with the employee. The Commission found that there was not an unreasonable delay between the employee’s suspension from his employment given that Council immediately secured a workplace investigator, Council’s rural location, travel arrangements to enable the external investigator to personally interview 7 employees, and the significant number of allegations to be drafted arising from interviews with team members.

What this means for Councils  
The QIRC decision serves as an important reminder to Councils to ensure adherence to not only the legislative requirements for proposed disciplinary action against Council employees, but also adherence with Councils own internal disciplinary procedures and policies. Importantly, an overly prescriptive disciplinary procedure or policy is likely to disadvantage Council if they do not adhere to each prescribed obligation. Ultimately, a deviation from a workplace policy or procedure can render a disciplinary process procedurally unfair and result in an adverse finding against a Council.

Lastly, the Commission’s Decision further highlights the significance for Councils to particularise allegations so that an employee can properly respond. The principles reinforced in this decision of course apply not just in the realm of workers’ compensation but in all facets of the investigative and disciplinary process.

If your organisation requires representation on any matter or needs advice on any industrial relations or employment law matter, please contact the team at peaklegal@wearepeak.com.au or call 07 3000 2148.