The case involved a Chinese nurse who was employed at an aged care facility. Following several incidents with members of the team, the employee claimed that she was “ganged up” on by Filipino staff. The employee made formal complaints alleging discrimination to management. The General Manager (also Filipino) then turned these complaints against the employee leading to her dismissal.

The Federal Court of Australia (“FCA”) found that the employee’s employment had been terminated for exercising her workplace rights in contravention of the general protections provisions in the Fair Work Act 2009 (Cth) (“FW Act”). Having succeeded in her claim, this decision focused on the compensation that could be awarded to the employee and penalties imposed on the employer. The case provides a number of learnings for employers and illustrates how employees can still be awarded significant amounts of compensation despite the employee’s initial claim of $2.5m being rejected.

The employee claimed compensation for past and future economic loss, non-economic loss, past and future out of pocket expenses, and, past and future gratuitous care totalling an amount just short of $2.5m. Penalties for breaches of the FW Act were also sought. Conversely, the employer sought that nominal compensation be paid to the employee with no penalties being imposed on the employer.

The FCA found that the damages sought by the employee “bore little relationship to the statutory and evidentiary foundations for the amounts claimed”. While this meant that the employee was not awarded the $2.5m she was seeking, a significant amount of compensation was still awarded to the employee.

It’s in the past…

In relation to the employee’s claim for past economic loss, the FCA awarded $175,000 and accepted that the employee would have continued to work for the employer for a period of time. Although various methods were used to calculate the amount of past economic loss (with some calculations putting the loss as high as $440,000) the FCA found that $175,000 was appropriate compensation.

The employee also claimed an amount for past out of pocket expenses related to her medical treatment including the cost of visiting her general practitioner, psychologist and psychiatrist. However, as the employee had made a workers’ compensation claim there was uncertainty around the out of pocket expenses that had actually been paid by the employee and accordingly this claim failed.

What about the future…

For future economic loss, the employee had claimed loss until retirement age (being an amount of $784,000) on the assumption that she would be unable to return to work. The FCA accepted that the employee had suffered an injury and was suffering from adjustment disorder with mixed anxiety and depressive mood caused by a combination of workplace stressors including the eventual termination of her employment.

The FCA considered the employee’s present capacity to work, further treatment required and her ability to obtain alternative employment. The FCA assessed that based on the evidence the employee would be able to return to full time work in 18 months and awarded $61,559 for future economic loss.

Future out of pocket expenses were also assessed and $10,000 was awarded for expenses relating to the employee’s future medical care.

Other claims…

The FW Act permits compensation to be awarded for loss other than financial loss and the employee claimed $300,000 for hurt and humiliation.

The FCA was satisfied that the employer’s contraventions caused the employee to suffer “real harm of an emotional nature, which has caused her hurt and humiliation and to suffer from mental harm.”

Accordingly, $75,000 was the appropriate award for the hurt and humiliation suffered by the employee.

The employee also made a claim for gratuitous care. However, the FCA found that these types of damages are usually awarded for personal injury cases, not for breaches of the FW Act.

The employee also claimed costs and interest, but no submissions were put forward in support of these claims. Accordingly, the FCA did not award any amounts for costs or interest but gave the opportunity for the employee to make submissions in relation to this.

Further penalties…

Two contraventions of the FW Act were established and at the time the maximum for each contravention was $63,000.

The employer submitted that they were a not-for-profit charity that was in financial peril by already operating at a deficit. While the size and financial position was considered in determining an appropriate penalty, the FCA noted that “the provisions of the FW Act apply equally to large and small employers, and to those that are financially secure and those that are not.”

The FCA imposed penalties on the employer in the amounts of $45,000 and $15,000 for the two breaches.

The case highlights a number of interesting points, the uncapped nature of the general protections provisions in the FW Act, the limitations that will be placed on future losses, the need for detailed evidence to support claims for economic loss and the significant penalties that can be imposed for breaches of the FW Act.