There are calls for reform of a legal loophole that sees council staff affected by bullying denied access to the Fair Work Commission.

The local government sector ranks among the top of all sectors for worker compensation claims of bullying according to the national work health and safety and workers’ compensation policy developer Safe Work Australia, an analysis by Government News shows.

According to Safe Work Australia data, workers compensation claims involving alleged bullying in local government were among the second highest of all sectors in 2017, with 42.2 claims per 100 million hours worked in 2017, up from being the third highest in 2016.

Despite this, two legal loopholes are seeing many local government employees without the recourse of the Fair Work Commission.

Most councils in Western Australia, NSW, Queensland and South Australia are excluded from the FWC’s purview, while councils in the other states are excluded if they don’t meet the legislation’s requirement of being a “constitutional corporation,” which requires they be classified as a trading or financial corporation.

Alex Grayson, a principal employment lawyer at Maurice Blackburn whose clients regularly include council professionals with claims of bullying, has raised concerns that local government employees in her jurisdiction of NSW don’t have access to the federal FWC.

This lack of access is resulting in employees’ rights being significantly diminished, Ms Grayson says.

“There are significant gaps in protections against bullying for all local and state government employees in New South Wales that need to be addressed by legislative reform,” Ms Grayson says in a recent submission to a parliamentary inquiry.

Last year, the FWC dismissed an application for a stop-bullying order from an acting CEO and elected councillor from Burnside City Council in South Australia.

In his reasoning, FWC deputy president Peter Anderson deemed the City of Burnside is not a “constitutional corporation” under the Fair Work Act.

Sheila Freeman, a bullying consultant who specialises in local government, has raised concerns that the same deficiencies in the federal system that impacted the City of Burnside significantly limit employees’ rights.

“Fair Work is not fair for a variety of reasons but in particular if someone doesn’t have any income to substantiate that they work in a constitutionally covered business then they can’t access the Fair Work jurisdiction,” she told Government News.

Ms Grayson says the inability of council staff to access Fair Work is significantly limiting the recourse available to them and exacerbating bullying in the workplace, as well as resulting in great personal distress for some clients.

She says:

“There are significant barriers to having bullying issues dealt with swiftly or proactively for these individuals and even less ability to have council’s actions reviewed by an independent tribunal.”

“While I can help people with the internal mechanisms, if that’s not done satisfactorily they can’t get access to an independent tribunal to try to repair relationships or get a compensatory outcome. It’s a very difficult situation to have little or no rights.”

Although council staff can still make a bullying complaint to their employer or to their state authority, such as Safe Work NSW, Ms Grayson says this action is futile if the state authority chooses to take no action.

Separately, in some circumstances a worker’s compensation claim can be made through an insurer if the individual has suffered a psychological injury as a result of bullying and requires treatment or time off work. This can be done even if an employee is still employed by the council, according to Ms Grayson.

She also reports that many employees feel that they have to resign to escape from bullying.

Legislative reform needed

Legislative reform is urgently needed to afford better protections to local government staff affected by workplace bullying, Ms Grayson says.

She points to Queensland where the state government recently closed this anomoly with an equivalent jurisdiction for local government and public sector employees so they can seek stop-bullying orders.

Ms Grayson is calling for the NSW Government to introduce legislation similar to this or the Federal Government’s Fair Work Act. This would provide an early response mechanism where employees could access a stop-bullying order designed at addressing issues before employees became too affected or feel they have to resign.

Call for compensation

However, the federal Fair Work Act itself also needs to be amended, Ms Grayson argues, so the system is able to offer compensation. Currently, the only available remedy is a stop-bullying order.

“Where someone can’t resolve bullying and they become unwell because of it, they should be able to get compensation to allow them to move on while they recover and get other employment,” Ms Grayson said.

“I would like to see a well-resourced, independent jurisdiction for all employees to try to resolve their workplace issues, and if they’re not capable of resolution, where they can seek compensation for the harm that has occurred to them.”

Ms Freeman is similarly calling for the jurisdiction of the FWC to extend to all councils.

She is also arguing for an overhaul of the internal bullying grievance system in local government so that all complaints must be investigated externally.

“I have found that in alleged bullying complaints that have been investigated internally, both the complainant and the alleged bully have not always been afforded natural justice.”

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