Adverse Action: LHMU v Arnotts Biscuits Limited

In the case of LHMU v Arnotts Biscuits Limited the adverse action which Arnotts was alleged to have taken was a threat to dismiss three employees who had engaged in misconduct. The misconduct was a failure to perform an important safety procedure. The employees had admitted their misconduct and their manager, as an alternative to summary dismissal and out of compassion for the employees, had suggested a months’ leave without pay as disciplinary action for their misconduct, which the employees accepted.

The union had brought an adverse action claim alleging that the threat to dismiss the employees was adverse action and the employee’s workplace right was their benefit under their agreement to attend work and to be paid. However the Court, looking at all the circumstances of the case, found that there was not a causal connection between the action and the workplace right.

Employers should ensure that:

  • They are clear about their reasons for engaging in any potential adverse action
  • Their reasons for the action has no connection with the employee’s workplace rights
  • There is contemporaneous documentation evidencing their reasons