Labour hire employers must follow due process when host employers dismiss their workers25 August 2017 | Employer's Liability
TasPorts supplies labour to privately owned ports. Grange Resources engaged TasPorts to provide personnel for its loading and shipping work. Gee was an employee of TasPorts, assigned to work at Port Latta for Grange Resources.
Grange Resources accused Gee of misconduct and blocked Gee's access to the port. TasPort terminated Gee's employment on the basis that it was no longer able to perform the inherent requirements of his position.
- Whether a labour hire employer, TasPorts, had an obligation to independently investigate whether the decision of Grange Resources to remove Gee from all sites was reasonable and whether Gee committed the alleged misconduct.
- Whether TasPorts had an obligation to adequately investigate options for Gee's redeployment.
Gee made an application to the Fair Work Commission for unfair dismissal and the Deputy President determined that dismissal was unfair. TasPorts appealed to the Full Bench of the Fair Work Commission.
The Decision on Appeal
The Full Court held TasPort had an obligation to independently investigate whether the misconduct of Gee had occurred. It could not simply adopt the results of the host employer, Grange Resources, procedurally unfair investigation. A contractual relationship between a labour hire company and a host employer cannot be used to defeat the rights of an existing employee. The labour hire company cannot use such relationships to aggregate the responsibilities to treat employees fairly. TasPort argued that a decision by a host employer in the context of a labour hire arrangement to have workers removed from the worksite was necessarily a valid reason for the worker's dismissal. That proposition was not accepted by the Full Court as:
- It was not clear that the terms of the Labour Hire Contract with Grange Resources gave Grange the right as host employer to remove Gee from the worksite.
- TasPort had simply accepted the host employer’s contention that the worker had engaged in misconduct without forming any independent view as to whether the allegation was substantiated.
- TasPort had made no real attempts to find alternative employment. TasPort argued that was not relevant to the question of whether there was a valid reason for dismissal based on capacity. That proposition was rejected as TasPort's decision to dismiss Gee was better characterised as conduct based, not capacity based. Hence there was an obligation for TasPort to fully investigate alternative work placements.
Implications for you
A labour hire employer cannot simply accept a decision of a host employer to remove a labour hire employee from site based on misconduct as a basis for dismissal. It has an obligation to independently investigate whether a labour hire employee has committed the alleged misconduct. A decision of a host employer to remove a labour hire employee from site is not of itself a valid reason for dismissal.