Maternity leave – a huge source of labour pain for employers ...

Some years back, I was asked by an employer to advise to advise on the least risky manner in which it could dismiss a female employee who was taking maternity leave and wanted to work from home after the birth of her child. The employer was not prepared to provide such a “flexible working arrangement” to its employee for various economic and other reasons.

I was hoping to advise my client on a certain course of action based on my reading of certain case law. I had just completed and sent my advice when a report appeared in the Sydney Morning Herald about a decision of the NSW Administrative Decisions Tribunal concerning a female public servant who sought similar flexible working arrangements. That decision went in the opposite direction of my advice.

If not handled sensitively, maternity leave can cause enormous labour pain to employers. Many employers don’t realise that employees proposing to take maternity leave can often have multiple remedies available to them. Remedies include action under State and Federal Industrial legislation (e.g. Industrial Relations Act (NSW) and Workplace Relations Act (Cth)), State and Federal Anti-Discrimination legislation, common law breach of contract action, claims under State Fair Trading and Federal Trade Practices Acts and much more.

One recent case illustrates how workplace litigation related to maternity leave can be commenced by employees at all levels of seniority. The Australian Financial Review reported on Wednesday 9 July 2008 of action commenced by a doctor against multinational pharmaceutical company GlaxoSmithKline (GSK). The action claimed that GSK had breached its obligations to the doctor by demoting her after she returned from maternity leave.

The doctor’s papers filed in the Federal Court include claims GSK engaged in misleading and deceptive conduct (presumably in breach of Section 52 of the Trade Practices Act) by making certain representations to her about her future employment as a medical director. The employee was seeking orders that she be reinstated to the same position she was at prior to going on maternity leave. She is also seeking compensation as well as a court order that any statutory penalty imposed on the company for breaching the Workplace Relations Act be paid directly to her. The maximum penalty payable for breach of maternity leave provisions under the WRA is $30,000.

The AFR report also mentioned two other recent cases, all of which involved employees using multiple remedies simultaneously.

Earlier this year ... a former employee of ... Perpetual accused the company of discriminating against her and breaching her contract by making her position redundant while she was on maternity leave.

Fiona Dunn, who earned almost $700,000 a year as general manager, wholesale, lodged a claim in March involving allegations of discrimination, breaches of the Trade Practices Act and
contractual breaches, and is seeking multimillion dollar damages ...

In another maternity leave-related case, a software company that sacked an employee who was on maternity leave because it liked her replacement better was fined the maximum penalty of $30,000 earlier this year.

Employers have to be extremely careful in this types of cases. Employees facing a change in their working conditions should also obtain advice on their rights, especially before signing any proposed settlement or contract upon their return from maternity leave.

Words © 2008 Irfan Yusuf