June 2017

When governing is work and decision-making turns into bullying

Robust discussions and disagreements are part and parcel of decision-making, especially at senior levels and in the boardroom.  Yet, we all know that decision-making can also involve personalities and politics, and occasionally, things can get difficult and nasty. 

It was only a matter of time therefore until a board member brought a claim of bullying in the Fair Work Commission against fellow board members.  In Adamson v Anangu Pitjantjatjara Yankunytjatjara Inc [2017] FWC 1976, the Commission was called on to consider, as a preliminary issue, whether members of the board were ‘workers’ and the alleged bullying conduct in board meetings was ‘at work’.

The initial view of the Commission was that the particular board member, Mr Adamson, was a worker and the alleged bullying of him occurred at work.  However, as Mr Adamson was not re-elected to the board, it was not the occasion to form any final views or to consider whether the actions in a boardroom were unreasonable.  The claim was dismissed as it had become futile - Mr Adamson was not at future risk of being bullied.

The decision in Adamson may alarm many boards.  Yet, as we explore below, the decision is a useful reminder of two important matters:

  • the breadth of the anti-bullying jurisdiction under the Fair Work Act 2009 (Cth) to protect workers; and

  • as the leaders of a business, why shouldn’t board members exhibit exemplary behaviour and be accountable for poor behaviour?

The FW Act’s anti-bullying provisions

Under the FW Act “a worker who reasonably believes that he or she has been bullied at work may apply to the FWC for an [anti-bullying] order”: s 789FC(1).  As can be seen, the provision applies to protect workers.  A ‘worker’ is defined in the FW Act to have the same meaning as the Work Health and Safety Act 2011 (our emphasis in bold):

A person is a "worker" if the person carries out work in any capacity for a person conducting a business or undertaking, including work as:

(a) an employee, or

(b) a contractor or subcontractor, or

(c) an employee of a contractor or subcontractor, or

(d) an employee of a labour hire company who has been assigned to work in the person’s business or undertaking, or

(e) an outworker, or

(f) an apprentice or trainee, or

(g) a student gaining work experience, or

(h) a volunteer ….

The facts in Adamson

Mr Adamson was the Chairperson of the Executive Board of Anangu Pitjantjatjara Yankunytjatjara Inc (APY); but was not an employee.  Mr Adamson was well remunerated in his role.  In that role, Mr Adamson:

  • was responsible to call and chair Board meetings;

  • would participate in the decision making and consultative processes of the Board; but

  • could not give directions to staff or make public statements on behalf of APY (unless specifically authorised by the Board).

Mr Adamson alleged he was bullied by the General Manager and Deputy Chairperson of APY.  In defence of the allegations, it was argued that the Board is the decision making body of “the employer” and not the worker.  As such, there was a distinction to be drawn between directors and employees, and it could not be said Mr Adamson was working for APY itself.

The Commission tentatively held

As a general rule, I doubt that the FW Act and WHS Act intended that members of [Boards] would, absent other factors be treated as workers”, the Commission said.

Yet, the definition of ‘worker’ is “very wide”.  Parliament chose to protect workers and not just employees.  The purpose of that very wide approach is to ensure that WHS risks from bullying are addressed.  “WHS hazards and risks do not discriminate based on legal relationships or whether a person is paid”, the Commission said.

While the definition of ‘worker’ identifies categories of workers, those categories are only illustrative therefore leaving the door wide open.  The essential question is whether the person said to be a worker “carries out work in any capacity for” the business.

Mr Adamson was found, at least on a preliminary basis, to be a ‘worker’.  Mr Adamson had a specific role to perform (and work to do) for which he was well remunerated.  “It seems to me that the activities undertaken by Mr Adamson in attending to the duties of Chairperson … represent work”, the Commission said. 

Lessons learnt

The anti-bullying provisions of the FW Act are intended to have a very broad reach and stretch beyond the traditional limitations of employer and employee. 

Whether ultimately the Commission concludes that board members are not working but governing, and are not ‘workers’, remains to be seen.  It would certainly be undesirable for the decision-making and politics of boardrooms to be open to public scrutiny in proceedings before the Commission.  We doubt Parliament intended that outcome.

Therein lays a challenge for governance.  These disputes should never get to the Commission in the first place.  Boards need to adopt robust codes of conduct and procedures to ensure its members conduct themselves appropriately at all times.  Disputes and grievances need to be resolved internally and promptly.  Boards have a fantastic opportunity to lead by example and instil a positive and respectful workplace culture.

But of course, even the most robust code of conduct won't prevent unmeritorious claims. Unfortunately, and notwithstanding the best intentions of the Gillard government, unmeritorious claims, particularly in the face of performance management, has been our main experience in this jurisdiction.

Author: James Mattson