Perth business taken to court over claims it discriminated against a pregnant employee by refusing her return to work

Editor’s note: Following the publication of this article in March 2017, the Federal Court of Australia subsequently found in favour of the business in February 2018, ruling that the Fair Work Ombudsman’s case against the company had “no real prospects of success”. The claims against the company and its director were dismissed and the Fair Work Ombudsman was ordered to pay costs on an indemnity basis. The full judgment from the court is available here. 

The Fair Work Ombudsman has launched legal action against a Perth-based food distribution company over allegations the business discriminated against a pregnant employee by refusing her right to return to work after she took parental leave, and by presenting her with a pre-prepared resignation letter after she told management she had fallen pregnant a second time.

Action has been initiated in the Federal Court against the business, and its part-owner and director.

The Ombudsman alleges that in early 2015, a sales executive at the business notified the company she intended to start a period of parental leave in mid 2015 and a short time later, the company raised unwarranted performance management action against her as a response to her request.

It is alleged the staff member was asked to delay her maternity leave in order to cover a staff shortage at the business. While the staff member was on leave in November 2015, it is alleged she was then told her request to return to work on a flexible arrangement had been rejected, and the company advised in writing she would return to full-time duties in April 2016.

However, the staff member fell pregnant with a second child, which she notified the company of in March 2016. The Ombudsman claims that while she wanted to continue with the plan to return to full-time work in April, the company said it would be extending her unpaid leave until after the birth of the second child.

The staff member claimed it was her right to return to work, and the Ombudsman alleges that in July 2016, she was asked to attend a meeting at which it was requested she sign a pre-written resignation letter.

It is unlawful to dismiss an employee who is on parental leave because they are pregnant, or because of family and caring responsibilities, and in a statement, the Ombudsman highlighted five previous cases in which it secured penalties against businesses for contravening pregnancy discrimination provisions in the Fair Work Act.

In a statement, Fair Work Ombudsman Natalie James described the allegations in this case as serious.

“Allegations that pregnant women are facing discrimination in the workplace are of grave concern and it is important that all employers are aware of their obligations under the law,” James said.

The Ombudsman is seeking compensation on behalf of the employee for economic and non-economic loss, as well as penalties against the business and its director, who faces penalties of up to $10,800 per contravention of workplace law and the company faces penalties of up to $54,000 per contravention.

Read more: Seven newsreader brings unfair dismissal claim: What are your obligations to staff on parental leave?

“Inconvenience” is no excuse

Employers must be aware that employees with 12 months of service are entitled to parental leave, and this right cannot be altered even if it throws up operational issues for the business, says employment lawyer Peter Vitale.

“There are a range of associated protections around that right, and so employers need to be fully aware of that and, frankly, inconvenience is not a good answer to an employee who seeks to exercises those rights,” he says.

While an employer cannot take adverse action against a staff member because they have indicated an intention to take parental leave, there could be some cases in which a coincidence of timing means that a staff member about to go on parental leave also needs performance management, says Vitale.

In situations like these, communication with the staff member and strict record keeping become essential.

“In these circumstances when you have a coincidence of timing, then the assumption that is often drawn is that the reason for the performance management must be related to the question of parental leave,” Vitale says.

Given this, it’s important that employers record and act upon any performance issues promptly.

“It highlights the need to be efficient and vigilant and timely in relation to staff performance issues, not just wait until some matter of inconvenience arises. In these circumstances, it’s important to carefully document what the legitimate concern is,” he says.

While an employer does not have to grant all requests for a return to a flexible role after a staff member returns from parental leave, they do have to consult with the staff member on these requests.

Vitale advises that businesses keep conversations open with staff members while they are on leave, to ensure everyone is across any changes in the workplace and the reasons why the employee may want a flexible return to work.

Businesses most frequently run into problems where they have failed to be clear with their employees, says Vitale.

“In fact, continued engagement with the employee is really the key to the satisfactory outcome. Most employers that get into trouble in relation to these issues do so because they’ve neglected to properly engage with the employee,” he says.

*This article was updated at 4pm on Monday, July 30, 2018 to add an editor’s note. It was updated again on January 16, 2019.

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