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Workplace Investigations: Failure to Investigate Employee Complaints Results In $5.2 Million Damages and Penalties in the Federal Court

October 28, 2020

On 2 October 2020, a publicly listed Brisbane company, TechnologyOne, was successfully sued in the Federal Court of Australia by its former Victorian Regional Manager (RM). The Court upheld the former employee’s unfair dismissal claim under the Fair Work Act and awarded him compensation of $5.2 million for his future economic loss, including foregone salary and share options. The orders made by the presiding Judge, Justice Kerr, also included penalties of $40,000 for the company and $7,000 for its Chairman.

Some of the company’s sales staff had made complaints about the former RM’s treatment of them. The RM had also made several complaints to the company alleging bullying by his managers. The company’s HR Manager recommended investigation of all these complaints, but her advice was not acted upon.

Although, at one point, the Chairman asked the company’s CEO if dismissing the Regional Manager, based on hearsay, was the “right thing to do”, the termination went ahead. The Court criticised and penalised the Chairman for his part in the decision-making process.

The Court’s decision emphasises that employees have a legally enforceable right to complain about alleged mistreatment or bullying, and that employers must take all complaints seriously and investigate them appropriately. Failure to do so is action contrary to the Fair Work Act and can result in substantial financial penalties and significant damage to organisational and/or personal reputations.

In this case, the facts indicate that a fair and independent investigation of the complaints made by and against the former RM would have led to better outcomes for all concerned. It is also possible that early intervention and alternative resolution strategies may have dealt with the conflicts that arose in the company’s Victorian Sales Team before they led to formal complaints.

How can Centium help?

Investigations

We have 10 highly qualified and very experienced workplace investigators. Our methodology ensures our investigations demonstrate procedural fairness. We treat all parties to matters with respect and our reports are clear, comprehensive and will withstand any test.

Advice

Our Ethical Conduct & Investigations team can assist with advice on how to deal with complaints either by investigation or alternative resolution strategies. We are always happy to provide free no-obligation advice on these matters.

To find out more about our Ethical Conduct & Investigations service, click here.

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