Federal Court dishes out $29,000 in fines in age discrimination case involving overlooked 70-year-old

The general protections provisions of the Fair Work Act 2009 (Cth) are wide-ranging in the sense that they provide protections to, and prohibit adverse action by, persons and entities beyond an employee and an employer.

The provisions also relate to conduct by or directed at prospective employees and employers, existing or prospective independent contractors, as well as industrial associations and officers or members of industrial associations.

Further, any conduct by a person which “advises, encourages or incites, or takes any action with the intent to coerce” another person to engage in unlawful adverse action may also be found to have contravened the Fair Work Act.

Accordingly, it is important that any person or entity that might fall under any of the aforementioned categories is aware of the obligations imposed upon them by the general protections provisions of the Act.

70-year-old prospective employee overlooked for job

In a recent decision of the Federal Court of Australia, a labour hire and recruitment company as well as a mining services company were ordered to pay pecuniary penalties for contravening the Fair Work Act in relation to unlawful adverse action taken against a prospective employee.

This penalty decision followed an earlier decision by the Court, which found that CoreStaff Pty Ltd, as a prospective employer, had discriminated against a prospective employee by refusing to employ him as a grader operator because he was 70 years old.

That earlier decision had also found that Gumala Enterprises Pty Ltd, which had engaged CoreStaff to recruit a grader operator, had advised, encouraged or incited CoreStaff to discriminate against the prospective employee because of his age.

When CoreStaff initially referred the individual to Gumala as a suitable candidate for the position, Gumala responded to the effect that they had considered him in a previous application but that his age was a concern. CoreStaff then advised the recruit that he had been unsuccessful in his application because of his age.

In determining the appropriate penalty to impose on CoreStaff, the court accepted that this incident appeared to be an isolated incident and CoreStaff had taken steps to discipline its employee upon becoming aware of it.

However, the court noted that the nature of CoreStaff’s business was recruitment and labour hire for other companies. In that context, CoreStaff held itself out to be an expert in employment relationships and should therefore be held to higher standards of understanding employment law and discrimination. It also noted that no steps had been taken to apologise to the individual.

Penalties for age discrimination

In determining the appropriate penalty to impose on Gumala, the court acknowledged Gumala’s submission that its core purpose was to provide funding for services that relieve Aboriginal members of the community from the adverse impacts of past discrimination based on their race. It also accepted that there was no inference that this incident reflected a broader culture of discriminatory views.

However, the court was of the view that “no organisation, regardless of its beneficial purpose and role in the community, is entitled to complacency when it comes to discrimination in the employment environment”.

On that basis, the court ordered CoreStaff to pay a pecuniary penalty of $20,000 and Gumala to pay a pecuniary penalty of $9000 (both equally distributed between the individual and the Commonwealth).

Lessons for employers

Employers should ensure their policies and procedures clearly set out the employer’s position on equal employment opportunities and anti-discrimination.

Further, employers should ensure that anyone involved in recruitment processes, whether that is internal human resources or recruitment employees or external recruitment agencies, is made aware of and trained in those policies.

This article was first published on the Workplace Law blog. Information provided in this blog is not legal advice and should not be relied upon as such.