How will the new bullying laws impact your business?

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The new bullying laws are purportedly a response to the general consensus amongst employers and employees alike that workplace bullying has become a big problem and simply needs to stop.

The reality is that bullying claims are costing businesses big bucks. In its report into workplace bullying, titled “Workplace Bullying, We just want it to stop”, the House of Representatives Standing Committee on Education and Employment estimated that workplace bullying cases costs Australian businesses an average of $17,000 to $24,000 per claim.

But how useful to business will these new laws, set to commence on 1 January 2014 actually be?

Under the new laws, any worker who believes that he or she is the subject of bullying will be entitled to apply to the Fair Work Commission to make an order for the bullying to stop. The Commission will be required to deal with the application within 14 days of the application being made and while the Fair Work Commission cannot order the payment of a pecuniary amount, it may make an order to prevent the worker from being bullied in the future. Furthermore, if the Fair Work Commission makes an order which the employer fails to comply with, the worker will have standing to apply to the Federal Circuit Court of Australia to enforce the order and impose a civil penalty which for an individual could be fined up to $10,200.00, while a corporation could face a penalty up to $51,000.00.

From a practical perspective, the danger for employers is that the definition of worker under the new laws extends to employees, contractors, subcontractors, trainees, students on work experience and even volunteers. It’s further complicated by the inevitability that workers, particularly employees are likely to believe that they are being bullied when they are actually being performance managed in a reasonable way. Nevertheless, once the application is made, the employer will, within 14 days have to attend a hearing before the Fair Work Commission and address the issues raised by the employee which will could cost the employer time and legal fees in what is largely a no costs jurisdiction.

Although we are yet to see how these laws are applied by the Commission, it is likely that “reasonable management action carried out in a reasonable manner,” will not be deemed as a contravention of the Fair Work Act 2009 (Cth). However, the problem remains that there is no actual definition of what is “reasonable management action carried out in a reasonable manner” and so determining whether or not a worker has in fact been the subject of workplace bullying is no simple task.

That’s why under these new laws it is going to become increasingly important that businesses are properly performance managing their employees and taking allegations of bullying seriously no matter who is making the allegation. There are steps which every employer can follow which assist in demonstrating reasonableness and fairness.

If you have any questions regarding to bullying in the workplace, please feel free to contact me.

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