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Walking the fine line between reasonable performance management and bullying

13 April 2013

Walking the fine line between reasonable performance management and bullying

Margaret Chan, Associate

Q: Which of the following would be considered bullying?

(a)  Criticising an employee for poor performance and firmly instructing them to rectify errors in their work;

(b)  Postponing an employee’s project, relocating tasks performed by them and offering them alternative duties;

(c)  Having a firm word with an employee about their absenteeism and lack of punctuality.

Depending on the circumstances and facts of each situation, all of the above could constitute bullying, but equally could be seen as “reasonable action” taken by an employer in respect of performance management and discipline – which is what makes the line between performance management and bullying such a fine one.

At present, claims of “bullying” in the context of performance management generally appear before the courts and tribunals as a result of a dispute about an entitlement to worker’s compensation or in the hearing of an unfair dismissal application.

The question is – will the Government’s proposal to allow individual employees who are bullied at work to complain directly to the Fair Work Commission (“FWC”) clear up some of the mystery around when performance management becomes bullying, or will it only muddy the waters even further?

Recently, the FWC found that even where performance management is stressful for an employee, this may not necessarily equate to bullying or harassment (although this would come as no surprise to most of us). In Choi v Country Fire Authority4, Ms Choi was told by several managers that her work was unsatisfactory and needed to be changed. Believing that she was doing a good job, Ms Choi refused to comply with these instructions, which led to the commencement of a formal performance management program. Following this, Ms Choi made an informal complaint that the “raising of ongoing performance issues by her managers” was bullying. After an incident involving an outburst directed at a colleague, Ms Choi was dismissed. She subsequently lodged an unfair dismissal claim and argued that the performance management process was “part of a bullying process by her managers”.

In dismissing her application, the FWC found that the stressful performance management process was not inappropriate nor unfair and that there was no reason to dispute the outcome of the employer’s investigation (which found that the behaviours engaged in by her managers were not bullying).

It should be noted that the FWC did not definitively decide that bullying and harassment had not occurred – it merely accepted the investigation outcomes. It remains to be seen whether a case with similar factual circumstances would be decided differently under the Government’s proposed anti-bullying regime.

In a similar vein, the recent Administrative Appeals Tribunal (“AAT”) decision of Fox v Comcare5 also raises the same questions about when a Court and Tribunal will definitively find an employee has actually been bullied.

In this case (which was not about performance management, but whether the employer had undertaken “reasonable administrative action” for the purposes of determining the application of an exception under worker’s compensation legislation) the AAT did not feel that it was required  to make a finding on the question of whether bullying had occurred. Rather, it accepted that the employee perceived that her manager was “bullying, obstructing and harassing her” when changes were being made to her job duties and work environment, subsequently causing her to sustain a psychological injury.

Employers should also be cautious, as not all actions to discipline or counsel employees will necessarily be characterised as performance management. As such, any exception for reasonable management action under worker’s compensation legislation – such as section 11A of the Workers Compensation Act 1987 (NSW), may not apply.

In South Eastern Sydney & Illawarra Area Health Service v Nikolis6, it was found that a number of meetings between a manager and an employee about her absenteeism and lack of punctuality could not truly be characterised as performance management. It was held that even if the meetings were to be treated as being performance management meetings, the “firm” tone of the manager and an incident where the manager had ended a meeting “with a bit of frustration” were sufficient to uphold a finding that Ms Nikolis would perceive it to be “bullying and intimidating”, and therefore she should be entitled to worker’s compensation.

Given the subjectivity of what employees may perceive to be bullying, the increasing frequency with which the term is used in complaints and the reluctance by the courts and tribunals to clarify what is or is not bullying, it is anticipated that the FWC will see an increase in the number of bullying complaints should the legislation be passed.

Some things your organisation can do to protect itself from bullying claims arising from performance management are to:

  • maintain objectivity and focus on the performance issues, not the person, during performance management meetings;
  • ensure that the emphasis of any performance management meetings are on the future – that is short, medium and long term goals – even though discussion of performance issues will necessarily involve discussing the employee’s past performance;
  • document all performance management discussions and meetings (as you may already be doing); and
  • pay attention to your oral and written communications and consider the impact of these on the employee.

  1. [2013] FWC 469  
  2. [2012] AATA 204
  3. [2009] NSWWCCPD 74
Posted in Strateg-Eyes.
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