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Rights and Wrongs – Employee Disputes Can Prove Expensive

  • Emma Tyler
  • May 13, 2024

Lawyers have a plethora of experience to draw upon when it comes to wrongful dismissal claims and employees taking action over unfair treatment in the workplace.

Examples include a supervisor aged in his 60s who successfully claimed for wrongful termination and discrimination when his position was made redundant before the role was filled by a relative of the business owner.

The Fair Work Commission found in favour of a man dismissed from a family smash repair business after already-strained relationships with his parents reached breaking point when he arrived late for dinner.

Those decisions clearly went in favour of the employees, but sometimes, even when terminating a person’s position or changing their role for good reasons, a lack of due process has tripped up the employer.

The costs of defending disputes can quickly escalate, particularly as inflation drives up legal bills and settlement outcomes, and many disputes are complex.

Employment practices liability insurance provides cover for actions against businesses concerning issues such as unfair dismissal and claims around discrimination, sexual harassment and bullying.

The cover has come into its own as workplace law reforms, societal changes and shifts in expectations affect the range of matters that must be considered.

Legislative reforms in recent years include the Respect at Work Act at the end of 2022, which introduced changes arising from the National Inquiry into Sexual Harassment in Australian Workplaces.

This puts more responsibility on business to not only respond effectively to cases of harassment or discrimination, but to take steps to prevent adverse conduct in the first place.

A workplace environment could be considered hostile if a reasonable person might view it as offensive, intimidating or humiliating, with examples including displaying obscene materials or sexual innuendo.

Unexpected events can also have ramifications, as shown by the covid lockdowns that started in early 2020. The pandemic led to disputes over vaccination requirements, while the shift in working practices has since been followed by issues around returning to offices and repercussions for people preferring to remain at home.

Technology and pandemic-driven changes have also increasingly blurred boundaries between work and home, leading to Federal Parliament this year passing “right to disconnect” legislation. The laws mean employees may refuse to monitor, read or respond to messages from an employer outside normal working hours, except in certain circumstances.

Diversity and inclusion considerations and laws around employee rights continue to evolve. Even when a business believes it has followed all rules by the book, disputes can arise, and they can be expensive. Talking to a broker about the appropriate cover has never been more important.

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