Flexibility, compliance and culture: Ideas for 2018

Sam Cahill, Associate

For many employers, the summer break offers an opportunity to recalibrate and plan for the year ahead. In this article, we look ahead to the new year, and suggest some initiatives employers might consider implementing to enhance employee satisfaction, address cultural issues and ensure compliance with workplace laws.

Flexibility

In today’s workforce, the opportunity to work flexibly is coveted by many employees. But when employers think of flexible working arrangements, they usually limit themselves to the right to make a request for flexible working arrangements under the National Employment Standards (“NES”). This right is limited to employees who meet the eligibility requirements (for example, 12 months’ continuous service, returning from parental leave, carer’s responsibilities or over 55 years of age).

In 2018, employers should consider taking a proactive approach to flexible working arrangements, rather than simply waiting for eligible employees to make a request under the NES. A more open approach to flexible working arrangements can be used to attract talented people to the organisation and enhance satisfaction and retention among existing staff.

A proactive approach necessitates a focus on identifying particular functions, positions or duties that can be performed on a flexible basis (for example, at different locations and times). A good starting point for this exercise is to review the flexible working arrangements that have been provided to employees in the past and where the functions, positions or duties that have been the basis for flexible work arrangements can be expanded or modified in light of current operating needs.

Compliance

In recent years, the Fair Work Ombudsman (“FWO”) has pursued employers in relation to a range of compliance issues, particularly the underpayment of wages and entitlements.

In September this year, the Fair Work Act 2009 (Cth) was amended to include a number of new measures aimed at protecting “vulnerable workers”.1 These measures include:

  • stronger powers for the FWO to collect evidence in investigations;
  • new penalties for providing false or misleading information to the FWO, or hindering or obstructing an FWO investigation;
  • increased penalties for “serious contraventions” of workplace laws (ie, deliberate contraventions);
  • increased penalties for breaches of record-keeping and pay slip obligations; and
  • a reverse onus of proof in underpayment claims where an employer has not met record keeping or pay slip obligations and cannot show a reasonable excuse.

This means that it is more important than ever for employers to take a proactive approach to ensuring compliance with workplace laws. An important first step towards ensuring compliance is to conduct a thorough review of the organisation’s employment arrangements, including:

  • the engagement of employees and other workers (including the procurement of any external labour services);
  • the coverage and application of industrial instruments (Modern Awards and Enterprise Agreements);
  • compliance with award/agreement requirements with respect to rostering, minimum rates of pay, loadings, penalties and allowances;
  • the accrual and payment of leave entitlements, including the recognition of prior service where appropriate;
  • compliance with obligations in relation to pay slips and record keeping; and
  • the impact of any changes to Modern Awards made by the Fair Work Commission as part of its Four Yearly Review of Modern Awards (for example, the introduction of new provisions regarding annual leave and casual conversion).

The purpose of such a review is to uncover any existing or potential compliance issues so they can be resolved internally and with minimum disputation and/or external scrutiny. The review may also highlight areas in which the organisation will need to develop systems and processes to ensure compliance going forward.

An employer’s compliance obligations under the various workplace laws are subject to almost constant change. This means that employers are required to continually review and adjust their systems and processes. For example, in July this year, as part of the Four Yearly Review of Modern Awards, the Fair Work Commission decided to incorporate a model “casual conversion” clause into 85 Modern Awards. The model clause provides that:

  • the employer must inform casual employees of their right to request a conversion within the first 12 months of employment;
  • casual employees who have worked a standard pattern of hours over the 12-month period will be eligible to make a request to convert to full-time or part-time employment; and
  • a request to convert can only be refused on reasonable business grounds (for example, where the conversion would require a significant adjustment to the casual employee’s hours of work or where it is known or reasonably foreseeable that the employee’s position will cease).

For some employers, the idea of casual conversion is nothing new, as it has existed in certain industries for some time. However, for others, it will be necessary to develop the appropriate systems and processes for:

  • monitoring the engagement and pattern of work of casual employees;
  • notifying relevant employees of their right to request a conversion to permanent employment; and
  • considering and making decisions in relation to requests for permanent employment.

The performance of these systems and processes will then need to be measured as part of the next review of the organisation’s employment arrangements.

Culture

In recent months, a number of allegations, mainly relating to sexual harassment and other inappropriate behaviour, have surfaced in relation to a growing list of high-profile men, including Hollywood celebrities, politicians and business leaders. In some cases, the alleged conduct was repeated over many years and was even well-known within certain organisations and industries. This has raised the question: why has it taken so long for the allegations to surface?

As discussed in the earlier article, “Power, sex and silence in the workplace”, this delay has been attributed to a number of factors, including a reluctance to report misconduct due to fear of victimisation, leading to a “culture of silence” within particular organisations. Some have argued that this culture of silence amounts to a “culture of complicity” in the action of the perpetrator. This topic will be one of the topics addressed in our series of PCS webinars next year.

Employers can take a number of steps to try and overcome a “culture of silence”. These include:

  • encouraging a culture of appropriate conduct modelled by senior staff within the organisation;
  • ensuring that anyone who reports conduct is treated with respect and their experience is not minimised;
  • ensuring the policies are drafted so that employees are specifically required to report any inappropriate conduct;
  • introducing stronger protections against victimisation for workers who report conduct; and
  • ensuring that workers receive training in relation to bullying, harassment and discrimination and what to do if they experience or witness this type of behaviour in the workplace.

  1. Fair Work Amendment (Protecting Vulnerable Workers) Act 2017.

Change Management and Performance Management: how to get the best out of people

Claire Brattey, Associate Director

Resistance to change is normal. The successful management of change is defined by the ability of people to move towards, and accept, the vision for change.

It sounds simple.

The manner in which the terms ‘Performance Management’ and ‘Change Management’ are thrown around the office these days you could be forgiven for thinking that the processes have been so well developed that they are always successfully implemented.

But according to New York Times best selling author John Kotter, 70% of change initiatives in organisations and businesses fail.

Why? In most cases the principal reason for failure, is simply a failure to communicate.

Regardless of whether it is a change management process or a performance management process, bad implementation and execution of any process causes stress within the workplace.

Workplace stress is costing the Australian economy at least $14.81 billion a year – 3.2 days a year, per worker are lost to workplace stress.1

A great deal of time and money has been spent by many research institutions on how to implement effective change management and how to get the most out of employee performance management, yet recent research indicates that neither are being implemented effectively.

According to a public survey by Deloitte, only 8% of companies report that their performance management process drives high levels of value, while 58 percent said it is not an effective use of time.2

What is clear is that the meaning of change management and performance management is different to an employer and an employee.

Unless something is done at the beginning of the process to bring both the employer and the employee closer together, both parties will often travel down different paths and fail to arrive at the same destination.

WHAT DOES ‘CHANGE MANAGEMENT’ MEAN TO EMPLOYEES?

For most employees, their first reaction to change management is ‘Am I going to be made redundant?’ It is rarely received as a good thing. After all, since when has advancement in technology increased the headcount within an organisation?

Change is therefore met with resistance by employees who are often highly suspicious and sceptical of any new process. This resistance quickly develops a life of its own and starts to create its own narrative. Employees can be heard uttering phrases such as, “Change won’t work because it takes far too long to do it the new way,” “it has so many teething problems it will never do what it was supposed to do,” “I don’t like the new system, it is too hard, too difficult, the old way was quicker…” If the resistance is allowed to fester, employees will look to senior management to see whether they truly believe the change is worthwhile.

Unfortunately, if the resistance is not managed at the beginning and it is allowed to build momentum, senior management will be themselves fatigued with the change or simply overwhelmed by the negative feedback and therefore they too believe it will never succeed. It becomes a self fulfilling prophecy.

WHAT DOES ‘CHANGE MANAGEMENT’ MEAN TO EMPLOYERS?

In most cases the need for Change Management means that something within the organisation could be improved, leading to greater efficiencies and increased profits.

Efficiencies may be achieved in a variety of ways, including technological advancement or an automation of process or sometimes a restructuring of the organisation .

Usually, whatever has been scored as ‘room for improvement’ is costing the organisation in lost productivity or loss of revenue. In many cases it does not necessarily mean that the business is losing money, but rather that it could be doing better.

Senior management spend weeks and months identifying the source of the problems within the organisation and come up with a plan to resolve issues or improve current ways of working. Ultimately the goal is to increase profits.

A perfect example of this is Deloitte’s recent overhaul of its performance management process. Deloitte’s had identified that their existing process was not delivering the benefits that it was designed to do. When they started to analyse the data they discovered that when they tallied the number of hours the organisation was spending on performance management, they found that completing the forms, holding the meetings, and creating the ratings consumed close to 2 million hours a year.3

At first glance, the correlation between improving the performance management process and improving profits might not appear obvious. However, the statistics are that if your workforce is engaged, the organisation is likely to enjoy a 26 percent higher revenue per employee.4 Furthermore, it was found that organisations with highly engaged employees earned 13 percent greater total returns to shareholders. The divide between what is motivating management and what motivates employees can be vast.

WHAT DOES ‘PERFORMANCE MANAGEMENT’ MEAN TO EMPLOYERS?

Successfully implemented and managed at an organisational level, this process will assist the organisation to improve productivity and efficiency. This translates to an increase in profits.

The actual process contains many elements covering the life cycle of the employment. It should determine what the initial performance requires, ensure that the performance levels are benchmarked and that those levels are maintained if not improved upon. It should evaluate the organisational needs and ensure that training and development is identified and implemented. This in turn will drive a high performance culture, determining remuneration levels, bonus and promotions. Of course, where those standards are not being met, it will also provide for disciplinary procedures and terminations.

Its purpose is to ensure that employees’ activities and outcomes are congruent with the organisation’s business objectives. Effective Performance Management measures the progress being made towards the achievement of the organisation’s business objectives.

WHAT DOES ‘PERFORMANCE MANAGEMENT’ MEAN TO EMPLOYEES? 

Performance Management is perceived by many employees as a derogatory term. To most employees it means little more than the dreaded annual appraisal. An annual event that will determine their salary, their bonus or indeed whether they still have a job.

In many organisations, managers are promoted on the basis of their technical proficiency and not their staff management skills. They are poorly equipped to either praise staff and encourage high performance or have constructive conversations with staff to set expectations and improve performance.

Poorly prepared managers approach a meeting with staff in a similar manner to a disciplinary meeting – they go in to the meeting armed with examples of when the employee did something wrong and see the appraisal as their opportunity to address the mistake.

Employees are left feeling that they have been blindsided and rather than have an opportunity to have a constructive discussion about their strengths and goals for the future. They feel compelled to defend their existence. As a result, no-one wins, the business does not achieve its organisational goals and employees are left feeling under valued and disengaged.

COMMUNICATION IS KEY

Regardless of whether you are implementing a Change Management process or a Performance Management process, the difference between success and failure comes back to one simple action: ‘Communication.’ Unless senior management takes the time to understand what motivates an employee and their stake in any change, the implementation of the process is highly likely to fail. It is the responsibility of team leaders to manage change in a way that employees can cope with. To achieve that, managers must be equipped with the critical tools to be able to do this.

Change is not just about following process. It is about being able to successfully manage the emotional response that it generates. All too often we see senior managers promoted on the grounds of technical competency but without proper regard to the communication or human management skills required. Faced with managing change, they often find themselves out of their depth. The human race is a complicated species. How people communicate and interact with each other depends on a variety of different elements. There is no written manual to give to managers. Understanding the workforce and responding to their needs will take time.

The first thing senior managers need to learn is to listen to their workforce. Once they understand the needs of the workforce, they can use this data to interpret how best to respond and communicate with their workforce. Communication can take a variety of forms including:

  • formal announcements from the senior leadership team delivered at town hall meetings;
  • announcements on notice boards;
  • using social media to up-date the workforce on a regular basis;
  • weekly up-dates given in person;
  • informal check-ins with employees;
  • organising team building events; and
  • arranging one to one meetings by phone, skype or in person.

Managers need to be able to communicate extremely well. Therefore, they need to be comfortable with the message and the different ways it can be delivered.

KEY BENEFITS 

Equipping senior managers with the tools to interpret emotional intelligence and therefore communicate with the workforce will enable managers to champion the change and respond positively to all employees capabilities and needs. Importantly, they will be seen by their team to lead. As Kotter said, for change to be successful employees must see and feel the benefits, only then will they change. Is it time you reviewed the way you communicate?


1. The cost of workplace stress in Australia – report by EconTech Commission and published by Medibank Private 2008

2. Performance Management is Broken – Deloitte University March 4, 2014

3. Reinventing Performance Management – April 2015 Marcus Buckingham and Ashley Goodhall –published by Harvard Business Review

4. Taleo Research 2009

Redundancy & Restructuring: What your organisation needs to know

Kathryn Dent, Director and Dimi Baramili, Associate

In recent times issues concerning redundancy and restructuring have been of major concern for organisations as they seek to structure their operations in a more effective and efficient manner. Whilst restructuring employees can have lucrative cost saving benefits employers need to ensure they are aware of and avoid the inherent legal risks presented by this process, which can have a signifcant impact on their organisation.

What is a genuine redundancy?

Redundancies should not be seen as an easy option for the termination of under- performing or problematic employees. Redundancies should only be implemented where the role is no longer required to be performed. This is not only the legal definition of redundancy (which will be reviewed by authorities such as the Australian Taxation Office or the Fair Work Commission) but it also forms the first limb to an employer being able to resist an unfair dismissal application.

“Redundancies should only be implemented where the role is no longer required to be performed.”

If the termination is a “genuine redundancy” as defined in the Fair Work Act 2009 (Cth) (the “FW Act”) then the employee has no recourse to the unfair dismissal jurisdiction. The FW Act provides that a genuine redundancy will arise where the job is no longer required to be performed by anyone due to changes to operational requirements, the organisation has complied with obligations to consult that are contained in any applicable modern award or enterprise agreement and finally that it was not reasonable for either the employer or its “associated entity/ies” to redeploy the employee.

It is also important that an organisation complies with obligations to consult that are contained in any applicable modern award and/or enterprise agreement as penalties may be imposed on both organisations and individuals for any breaches. Generally the consultation provision contained within a modern award, requires that where significant change is introduced all employees (and their representatives) who will be impacted need to be notified, with discussions to commence as early as is practicable after a decision to implement the changes has been made. These discussions will need to cover the likely effect of the changes and any steps to be taken to mitigate the adverse impact on relevant employees, the nature of the changes and their impact must also be provided in writing to relevant employees (and their representatives). Throughout the process the employer must give prompt consideration to any issues or queries raised by employees about the change.

In practical terms consultation needs to be a real opportunity for employees to influence the decision. The length of this process will depend on the number of redundancies and size of the organisation. In our experience because of the unpleasantness of the situation and the desire to complete the process and move forward many employers seek to get this over and done with in one meeting. While this is not necessarily in breach of the Award consultation provision it is certainly more open to challenge (either as an unfair dismissal or as a breach of Award or both) as well as potentially inflammatory and antagonistic and should, where practicable, be avoided.

At the same time as consultation, redeployment should be considered. While consultation is not mandatory unless there is an applicable award, all employees who could otherwise bring an unfair dismissal claim (because they earn under the threshold) must be given redeployment opportunities or, again, it will be considered not to be a “genuine redundancy” thereby exposing an employer to an unfair dismissal claim.

It is also important to note the breadth of the redeployment obligations and how a failure to consider these may render the redeployment “unreasonable”. For reasonable redeployment an employer should:

  • Consider all vacant roles which the employee is qualified to perform regardless of if they are in the same location (and yes even interstate opportunities need to be considered), at the same level (for example more junior) or less well remunerated;
  • Extend the redeployment to “associated entities” (as defined in the Corporations Act 2001 (Cth) and generally a broader range of companies than simply “related bodies corporate”).

Essentially an employer should give an employee as much opportunity to be considered for redeployment and let the employee make the decision as an employer may not be possessed of all the facts that may make what might otherwise look like an unattractive proposition, attractive. After all a job at lesser pay may be better than no job at all and jobs in other locations may justify an employee moving to an area where they may have family support or where there partner has opportunities. If there are no positions within the employing or associated entities then the considerations are far easier but the communications, both verbal and written, should still confirm that the employer considered redeployment.

For an order of reinstatement to be made for failure to redeploy an individual, a recent case decided by the Full Bench of the Fair Work Commission (Technical and Further Education Commission T/A TAFE NSW v Pykett [2014] FWCFB 714) has indicated that a specific suitable job or position must be identified by the employer, before it is able to order reinstatement (that is the Commission can order reinstatement without specifying a particular position).

Commissioner McKenna ordered reinstatement to a suitable position which was identified by the dismissed employee (Pykett v Technical and Further Education Commission T/A TAFE NSW (No.5) [2014] FWC 3177). In this decision Commissioner McKenna reproduced part of the Full Bench’s decision remitting it to her which held that it would have been reasonable to redeploy the employee to a position other than to an “advertised, permanent vacancy”. The issue across the various appeals was that at first instance the Commissioner did not make a decision that there was a job, position or other work into which the employee could have been redeployed. The employer sought a stay of this order but the Federal Court rejected  this (Technical and Further Education Commission v Pykett (No 1) [2014] FCA 727), and PCS understands the reinstatement order is currently on appeal by the employer.

A recent decision of the Fair Work Commission Full Bench (Teterin and Others v Resource Pacific Pty Limited t/a Ravensworth Underground Mine [2014] FWCFB 4125) confirmed the evidentiary burden required to be satisfied by the employer in the context of discharging its redeployment obligations for the purposes of unfair dismissal. It was held that the employer must provide adequate evidence to demonstrate the reasonableness of redeploying the individual(s). In this case an argument was raised that those who had their roles made redundant should instead have been offered roles currently performed by contractors. It was ultimately held that the redundancy was genuine, and the dismissal fair with the Full Bench noting that the employer had provided more than adequate evidence to demonstrate that it was not reasonable to redeploy the individuals. In particular, evidence that the contractors were performing generally short term, as well as highly specialised roles, and it had been explored with the union in the past whether the use of contractors could be reduced to retain permanent employees.

What other considerations are relevant during redundancies?

In addition to the above and at a minimum, employers should:

  • ensure they get termination payments on redundancy correct – they will need to pay or give notice, pay accrued but unused leave but also pay redundancy according to the most generous source ie contract, policy, FW Act, enterprise agreement or modern award; and
  • consider whether the terms of the FW Act allow the employer to apply for an exemption from or reduction of any otherwise payable redundancy payment (for example if the employer is unable to pay or where the employer has provided an employee with “other acceptable employment”). What is “other acceptable employment” will depend on the employer’s and employee’s unique facts and circumstances, with the following factors relevant:
    • whether the work is “of a like nature”;
    • comparable pay levels, hours of work, seniority, fringe benefits, workload and job security; and
    • a level of responsibility and pay similar to the original role held by the employee.

Finally organisations should be aware of the additional consultation and notification obligations under the FW Act where there are 15 or more dismissals occurring due to redundancy.

What types of legal risks can your organisation face?

There are numerous actions that may be brought by or on behalf of an employee whose employment has been terminated due to a redundant position, as follows:

  • Breach of an enterprise agreement or award (and possibly employment contract), which provides for certain processes and procedures to be followed and/or certain amounts to be paid. Generally, consultation requirements place the onus on the organisation to notify and provide certain information to employees who will potentially be affected often within specified deadlines, and allow employees to have a say during the process including the opportunity to raise any queries or concerns.
  • A General protections claim if it is shown that selection for redundancy was for a non-genuine reason, in response to an employee exercising a workplace right such as making an inquiry in respect of their employment.
  • Discrimination claim on the grounds that the redundancy was not genuine and rather, the individual was selected for redundancy on the grounds of a protected attribute such as race, sex, age, disability or sexual preference.

What should your organisation be aware of when restructuring / implementing redundancies?

  • Any applicable procedure or process is appropriately and fairly followed and appropriate documentation is maintained to demonstrate this.
  • Any relevant notice periods are complied with.
  • The employee is provided with the appropriate redundancy payment bearing in mind the relevant source(s) which may include the FW Act, award, enterprise agreement, and/or employer policy or custom and practice.
  • The process remains open and transparent with employees able to raise any queries or concerns throughout the process.
  • All reasonable opportunities for redeployment have been genuinely considered and appropriate evidence of this can be demonstrated.

An earlier and edited version of this article has been reproduced in the Accommodation Association of Australia’s Key News Update and HM Magazine.

Hypothetical 2013 – The Most Difficult Dismissal of All…

Margaret Chan, Associate

PCS’ second annual Hypothetical event, held this year at the Australian National Maritime Museum in Darling Harbour, was a spectacular evening.

While a number of workplace relations issues have been the focus of much attention in 2013, this year’s hypothetical was about one issue that is never far from the minds of most human resources and employment law practitioners: termination of employment and best practice dismissals.

This year, PCS was privileged to have SKY NEWS Business channel presenter, Brooke Corte (pictured on page 5), as our MC for the evening. Attended by over 120 friends and clients of PCS, this year’s Hypothetical was also televised on SKY Business’ Australian Public Affairs Channel on Monday, 25 November 2013.

The scenario

A captivated audience watched a video written, produced and directed by none other than PCS’ founder and Managing Principal, Joydeep Hor unfold on the big screen. The video depicted the different perspectives, tensions, conflicts and sense of betrayal caused by the highly public and rather sudden termination of the CEO of “the Company”, Garry, by the Board – who was represented by its Chairman, Frank.

The video showed Garry and Frank discussing their views on Garry’s termination – highlighting underlying issues and reasons such as the poor financial performance of the Company, Garry’s lack of accountability about the Company’s financial performance, the lack of performance management, the risqué client entertainment of the Company’s high value clients involving escorts and pole dancing aboard Garry’s yacht, the amount of notice given to Garry when he was terminated and the non-compete restraint in his unsigned employment contract. The issues of stress, depression and bullying were also alluded to by Garry.

Our expert panel

Following the video, it was over to the Expert Panel, who were required to think on their feet and respond to the questions posed by Joydeep as Facilitator.

On the expert panel for the first time this year were:

  • Michele Grow, CEO of Davidson Trahaire Corpsych, playing the role of newly-appointed Non-Executive Director;
  • Tim Donaghey, Barrister-at-Law, providing input on the legal issues facing Frank and the Board; and
  • John Dakin, Director of Career Management firm Directioneering, acting as Garry’s career management advisor.

Previous panellists:

  • Robyn Sefiani from Sefiani Communications Group; and
  • Hannah Low of the Australian Financial Review

also reprised their roles on our expert panel this year to provide their perspective on the media and public relations implications of this high-profile termination.

Issues at play

Our expert panel this year was treated to a smorgasbord of issues to pick their way through – including a series of complex legal, management and psychological issues such as:

  • whether high level executives (such as CEOs) should be subjected to formal performance management processes if and when they are underperforming;
  • the implications of an investigation into Garry’s inappropriate conduct in allowing the risqué client entertainment event (dubbed the “Love Boat” by Tim) and his subsequent high-profile termination;
  • Garry’s allegations of bullying against the Board – by “ambushing” him and tabling “reports prepared behind (his) back”;
  • whether the payment provided by the Company in lieu of notice was sufficient;
  • personal liability issues for the Board of Directors;
  • Garry’s depression and mental health issues; and
  • whether a non-compete restraint could be enforceable where there was no signed contract, and even if there had been one, (or deemed acceptance of the terms by Garry), whether it would be enforceable by the Company.

Expert analysis

Our experts then broke into an energetic and, at times, playful discussion about the various factors that would influence them and the thoughts that were going through their heads as the Hypothetical scenario unfolded before them.

Michele Grow spoke in her capacity as a hypothetical Board member, discussing the duties of a Director from a corporate governance perspective and the necessity of obtaining further clarity around the timeline, process and reasons for Garry’s termination.

In response to Garry’s claims about feeling stressed and depressed, Michele highlighted the obligations of the Board to ensure that it was taking appropriate “care and protection” of the workforce – touching upon some of the officers duties under work health and safety legislation.

Michele then donned an organisational psychology cap and offered her insight into Garry’s revelation that he had depression. Although it should come as no surprise, Michele revealed that 45% of all adults will suffer from some form of mental illness at some point in their lifetime and that many individuals are able to function at quite a high level during this time despite their illness. Accordingly, while mental health should be treated with care in the work place, it should not necessarily be treated as an impairment or be used to excuse underperformance (particularly in circumstances where it is unclear whether there has been an actual diagnosis of depression – as was in Garry’s case). However, Michele indicated that in the circumstances, given his particularly stressful termination, it would be necessary to ensure that Garry was seeking appropriate support for his condition.

Tim Donaghey, as a legal representative on the panel, was responsible for unpacking many of the legal issues around Garry’s termination. Tim examined the implications of Garry’s unsigned contract and whether he may still be bound to its terms, the notice payment of 3 months that was provided to Garry and whether this could be open to challenge given his seniority, as well as potential breach of contract issues by the Company.

Tim also suggested that Garry could potentially bring a General Protections claim under the FW Act on the basis of discrimination following the disclosure of his depression – although this would be dependent on whether Garry could establish that there was a causative relationship between his mental illness and termination. Tim then went on to discuss whether there was an obligation on the Company to undertake a performance management process with Garry, as well as the issue of personal liability of CEOs and Board members in these types of termination situations.

John Dakin walked attendees through what this termination meant for Garry from a personal perspective and the issues he would work through with Garry as his career management advisor. John explained the types of emotional and psychological issues that Garry may have – particularly given the long tenure Garry had with The Company and his meteoric rise through the ranks. John also addressed the importance of personal branding (particularly at the executive level) and the importance of seeking advice around communications – particularly where legal proceedings are on foot.

John then raised the very pertinent question of whether Garry had received the necessary training that he needed before being appointed to the CEO role and whether this could have been a contributing factor to his underperformance in the role.

Hannah Low also took to the stage to reveal what would spark a journalist’s interest in the scenario and the types of issues on which a journalist might choose to focus.

In addition to the yacht incident, the size of the organisation, the alleged bullying at the highest levels of the Company, the culture of the Company and whether Garry was performance managed out of his role were all deemed to be factors which would make the scenario an attractive one for journalists.

Hannah also highlighted that while Garry’s mental health issues would not, of itself, necessarily be newsworthy, any suggestion that the mental health issues had arisen as a result of his role – particularly when tied in with the issues of executive and corporate bullying, would certainly make Garry’s story a more interesting one for readers.

Robyn Sefiani explained to attendees how she would approach managing the publicity that would ow from these events and how to minimise reputational damage to the Company, as well as to members of the Board – particularly given Gary’s allegations that policies had been applied inconsistently. Robyn suggested that any damage control that she would undertake would be both internal and external and would largely depend on whether the Company’s actions aligned with what it publicised as being its values. Her advice also included a suggestion that the Board would need to investigate to discover how deeply-rooted and prevalent the “ends justifies the means” culture was in the organisation and whether the risqué yacht incident was a one-off incident attributable to its former-CEO, or whether more systematic issues lie dormant within the organisation which could create future reputational risk.

In response to a question from Joydeep about whether Frank should accept interviews from Hannah (or another journalist), Robyn also outlined the various strategies that could be adopted and which of these would be most appropriate in various circumstances.

Holistic, best practice processes

The combination of minds on the Panel were illustrative of the many stakeholders that are common to a high-pro le termination scenario and also reinforced the importance of having a holistic approach to people management matters, underpinned by a solid and pragmatic legal strategy. However, one key takeaway from the night is that “every termination of employment needs to be treated as the most dif cult termination of all” – regardless of who is being terminated and why.

Many in attendance on the night commented afterwards that this year’s Hypothetical confirmed much of the best practice processes around termination which they were aware of, but the added dimension of dealing with aspects of the termination which were not usually associated with primary HR functions – such as the reputational and public relations implications and strategies in these circumstances – were “food for thought” and fertile ground for further discussions with their teams.

We hope that all our guests at the event walked away feeling better prepared to make sure their businesses are well informed about dealing with dismissals.

Once again, the PCS team would like to take the opportunity to thank everyone who attended its signature event.