Employer liable for employee's discriminatory threats


Employer liable for employee's discriminatory threats

An employee stipulated that for a tender to be accepted, the employees of the tender had to be union members.


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An employee stipulated that for a tender to be accepted, the employees of the tender had to be union members. The employer was subsequently held to be liable for the employee's discriminatory actions.

The company, which at the time was building oil rig platforms, advertised for tenders to run a catering/canteen facility. During this tendering process the storeman who was responsible for organising the tenders was alleged to have said to one organisation who was putting in a tender:

"You have to be in the AWU or Miscellaneous Workers Union or your proposal will not be considered and you will not be allowed on site".

A complaint was made when an employee of the tender was asked for her 'ticket' before entering the site (Leighton Contractors Pty Ltd v Allan Graham Shuttleton; No 2184 of 1998).

Findings of the Industrial Magistrate

The Western Australian Industrial Relations Act 1979 (the Act) prohibits a person from threatening discriminatory action against another person. Once an officer of a company has been found guilty of threatening discriminatory action, the corporation is held to be guilty of that offence unless it can prove that it took all reasonable steps to prevent this action occurring.

The Industrial Magistrate tried the case at first instance and heard evidence from another organisation which was also informed by the storeman that the employees were required to be union members if the tender was to be successful. The storeman was operating under the belief that union membership was company policy. The Company stated that it was preferable for people on site to be members of a union. In saying so, the company was relying on a preference clause in the award governing the work site.

While the Industrial Magistrate concluded that the storeman was not an officer of the company, and so the company was not liable under the Act, the storeman was found to be an 'agent' of the company. The company and storeman were then fined $11,109.75 and $2,400 respectively.

Findings of the Full Bench



The matter was appealed to the Full Bench of the Western Australian Industrial Relations Commission, which confirmed that the storeman was not an officer of the company.

The Full Bench then considered whether the storeman was an 'agent' of the company. At common law, a company can be vicariously liable for an offence committed by one of its servants or agents in the course of their employment or agency. It was concluded there was sufficient evidence to find that the storeman was acting as the employee and the agent of the company.

In concluding, the Commission stated:

"There was sufficient evidence for His Worship to find that there was a policy of company 'preference for unionists' on site, strong enough to enable [the storeman] to say, within the scope of his authority as the 'arranger of tenders', that persons would not be able to come on site or be accepted as 'tenders' if they did not have appropriate 'union' membership".

The Full Bench held that the original decision should stand and the appeal be dismissed.


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