11 Dec 2014

Restricting employees' speech and political activities can be reasonable and lawful

by Michael Byrnes

If you want to restrict employees' political activities or public comment, any restriction must be a reasonable and lawful direction.

The rise of social media has given employees a greater ability to share their views with the world on a range of matters, including grievances about their employment. This can sometimes even extend to purporting to represent their employer on matters of controversy.

Restrictions on political activities or public comment by employees might seem to be Orwellian overreach, but such restrictions can, in some circumstances, have an important role to play in preserving business reputation and workplace harmony. Which restrictions are legitimate and which ones cross the line? A recent case in the Fair Work Commission is an instructive example of the way these restrictions can be a reasonable and lawful direction (AGL Loy Yang v Construction, Forestry, Mining and Energy Union [2014] FWC 8093).

The origins of the dispute

The dispute related to the mandatory completion of all compliance modules issued by AGL Loy Yang to employees, including an AGL Code of Conduct. The CFMEU objected to the Code training module as, in completing the relevant module, employees were obliged to formally agree to be bound by the expectations in the Code.

The CFMEU claimed that certain provisions were "unnecessarily wide, oppressive and impractical". It told its members the Code module would only be acceptable if the mandatory agreement was removed, and then told them not to complete the Code module.

The Commission examined whether it is reasonable and lawful to require employees:

  • to agree to a ban on providing information, making public comment or political activity;
  • to answer certain questions in the Code module; and
  • to tick a box declaring they had understood the Code at the end of the module.

Restriction on providing information

The CFMEU argued that it was not reasonable or lawful to require employees to consent to the following parts of the Code:

  • "Not disclose to any person outside AGL information obtained from the performance of our jobs unless we are expressly authorised to do so by the person who provided the information or the information is already in the public domain or the law requires the information be made available to the person requesting it."
  • "employees being banned from providing to "any person" information "obtained from the performance of [their] jobs, unless it is already in the public domain"

AGL Loy Yang argued these parts of the Code were directed at safeguarding personal information and ensuring employee compliance with confidentiality obligations placed on AGL Loy Yang, despite the word "information" not being specifically qualified by the word "confidential" .

Commissioner Michelle Bissett said that, upon reading the Code in its entirety, the restriction on disclosing information only related to confidential material. Thus, the requirement was not "unnecessarily wide, oppressive and impractical". She held that:

"There is nothing in the Code that suggests an employee cannot discuss any information arising from work with his or her doctor, lawyer or partner, rather the Code seeks to protect confidential information gained through employment"

Restriction on public comment and political activity

The Code also restricted employees from making "public comment about any matter, or participate in any political activities, which can be attributed to [their] employment with AGL".

The Commissioner found the restriction "difficult" as "employees at AGL Loy Yang are members of, and have a right to participate in the democratic process of, civil society. This freedom includes the right to express political views and make public comment".

The Commissioner was particularly concerned with any restriction on public comment and political activity by AGL Loy Yang if it restricted employees from participating in legitimate activities associated with their union membership, such as industrial action, of which AGL Loy Yang may disapprove.

However, she regarded the Code as only restricting public comment or political activity that can be attributed to the employees' employment with AGL Loy Yang. It did not seek to limit employees' engagement in their private time in political activity or making a public comment as a private citizen. Therefore, it was not unreasonable for AGL Loy Yang to protect its reputation by ensuring that comments and activities related to AGL Loy Yang came from authorised representatives.

Answering questions in the Code        

Employees were asked:

  • which ethical behaviour best applied to AGL Loy Yang;
  • how AGL Loy Yang best maintains professionalism; and
  • whether AGL Loy Yang considers the broader corporate and social impacts of their decisions.

These questions, the CFMEU argued, were unreasonable as they required employees "to accept the premise of each of the questions".

The Commissioner disagreed. Respectively, they did no more than:

  • restate what the Code said;
  • asks employees to identify what is in the Code; and
  • ask the employee if they understand this is what AGL says.

Direction to complete the declaration in the Code

Upon completing the Code module, employees must tick a box that says "I have read and understood the AGL Code of Conduct, and agree to abide by it".

AGL Loy Yang argued that the declaration was to help it track who had, or had not, completed the module. Given that it did not require a declaration for other important training modules, it was clear that AGL Loy Yang did not need a declaration to have knowledge of the completion of the Code.

The Commissioner said that the declaration went "further than is reasonable" because a reading of the Code does not always mean an employee fully understands the contents of the Code, the extent to which he or she is bound by the Code or the implications of a breach of the Code.

Were the restrictions within the scope of the contract of employment?

The Commission noted that "employment does not entail the total subordination of an employee's autonomy". However, the restraints were held to be in relation to the employee's employment. It was not a restraint on what the employee could do in their own time. As long as they had a "reasonable connection with work", the restraints were lawful and within the scope of the contract of employment.

Lessons for employers

Workplace policies – including social media policies – need to reconcile employees' right to make legitimate private comments and employers' right to protect their interests and reputation. This decision shows that they will be scrutinised closely, so ambit claims should be avoided. It's crucial to link the comment to the employment and show that the restriction is a reasonable one.

Employers should also be careful with the tick-a-box declaration at the end of training, especially where the employee is certifying that they understand the contents and agree to be bound. Declarations like this ought to be made only when it's reasonable to ask for them, and employees have a chance to obtain clarification.

Generally, employers should seek legal advice when imposing restrictions and issuing directions to their employees that might potentially seek to curtail the exercise of private rights.

Thanks to Ann-Maree Harnett for her help in writing this article.

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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.