22 Nov 2012

Anti-discrimination reforms hold some challenges for employers

by Joe Catanzariti, Stuart Pill

These reforms to discrimination law could impact employers' compliance with discrimination law, and increase their exposure to discrimination claims in the federal jurisdiction.

The promised consolidation of federal anti-discrimination laws is a step closer with the release on Tuesday of the exposure draft of the Human Rights and Anti-Discrimination Bill 2012. While a great deal of the current law would be retained in the new Act, the exposure draft contains some significant changes of which employers should be aware.

Vexatious discrimination claims could be struck out

No doubt many employers will greet with relief the proposal to give the Commission the power to close a complaint if it is satisfied that the complaint is frivolous, vexatious, misconceived or lacking in substance.

Another procedural change is that parties should bear their own costs for litigation as a default position, with the court retaining a discretion to award costs in the interests of justice. This could mean that not only would vexatious claims be dismissed, but costs conceivably be awarded against the unsuccessful applicant.

The shifting onus of proof in discrimination claims

Currently the complainant must show the respondent treated him or her less favourably because of a protected attribute. The exposure draft proposes a shifting burden of proof, so that the complainant must establish the primary elements of discrimination, such as:

  • that he or she has a protected attribute; 
  • the unfavourable treatment or policy which disadvantages people with that attribute; and 
  • connection to an area of public life.

The complainant however only has to make a prima facie case that the alleged conduct was for a particular reason or purpose. Once that is made, the onus then switches to the respondent. This is similar to the shifting onus under the Fair Work Act.

New protected attributes and the overlap with adverse action claims

There are two new protected attributes: sexual orientation and gender identity. Relationship discrimination will now extend to same-sex relationships.

Discrimination on the basis of industrial history, medical history, and nationality or citizenship will become unlawful in the area of work.

Expanding the scope of the regime to include industrial history (which is defined to encompass industrial activities and union membership) is particularly concerning, as it seems to enshrine in legislation the trend of convergence between adverse action claims and discrimination claims that we have been following for some years.

Furthermore, while the exposure draft says that generally a discrimination claim cannot be brought if a complaint has already been made under the Fair Work Act in relation to the conduct, a claim can still go ahead in the Commission if it is satisfied that there are "exceptional circumstances that warrant permitting the person to make the complaint". This raises the possibility of concurrent claims in Fair Work Australia and the Commission.

Defending a discrimination claim

There will now be a general defence that the conduct is justifiable if the conduct was engaged in, in good faith and for the purpose of achieving a particular aim, as long as: 

  • that aim is a legitimate aim;
  • the employer considered, and a reasonable person in its circumstances would have considered, that engaging in the conduct would achieve that aim; and
  • the conduct is a proportionate means of achieving that aim.

Specifically in the work context, it will remain lawful to discriminate against another person in work if the other person cannot meet the inherent requirements of a job, unless the employer could have made a reasonable adjustment for that disability that would allow the other person to carry out the inherent requirements of the job.

There will also be exceptions covering conduct that is a special measure to achieve equality, and other specific current exceptions that currently exist.

New codes as a defence to discrimination claims

A new, complete, defence is proposed as well, based on codes developed voluntarily by industry and certified by the Australian Human Rights Commission.

If an employer complies with these voluntary codes, it will have a complete defence to workplace discrimination claims.

What happens now?

If the exposure draft is adopted in its present form it has potential to significantly affect employers by:

  • impacting the manner in which they seek to achieve compliance with discrimination law; and
  • increasing their exposure to discrimination claims in the federal jurisdiction, which will be more difficult to successfully defend.

The exposure draft was referred yesterday to the Senate Legal and Constitutional Affairs Committee which will conduct an inquiry into it. This will be an important opportunity for stakeholders to express their views on the exposure draft.

At this stage we don't know when submissions are due, but the Committee's reporting date is Monday 18 February 2013, so we would expect them to be due fairly soon.  We will of course monitor this and keep you informed.

In the coming weeks we'll be going into the detail of these reforms more closely. Please do not hesitate to contact us if you would like to discuss how these potential changes will impact your business.

This article was written when Joe was a partner at Clayton Utz and does not necessarily reflect his views as Vice-President of the Fair Work Commission.

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.