Ashleigh Kotula, graduate workplace relations secondee based in AMMA’s Perth office, examines a recent case where an employee of BHP Coal failed in his bid to convince the Fair Work Commission he was unfairly dismissed.
In Ingrey v BHP Coal Pty Ltd T/A BHP Billiton Mitsubishi Alliance (1 March 2017), BHP Coal’s successful defence of its termination of a long-standing employee who had developed serious performance issues, demonstrates the importance of meticulous record keeping and adherence to policy during performance management.
The employee was a boilermaker at the BHP Billiton/Mitsubishi Alliance Saraji Coal Mine in central Queensland, and had been employed by BHP Coal at the site for 27 years.
He had not received any formal discipline for the first 23 years of his employment and in his 2011 annual review, received the highest possible performance rating from his then-supervisor.
In May 2012, he was involved in a dispute with his new supervisor, and soon after received his first Individual Development & Performance Review (IDPR) ‘below satisfactory’ level in his history at BHP.
He was later dismissed in July 2016, after a lengthy performance management process that included:
- An IDPR meeting with his supervisor in 2013, that resulted in no performance score being recorded after the employee notified a dispute to BHP;
- The employee being informed by his supervisor that he would be put through a Performance Improvement Plan (PIP) which was later dismissed after the employee again notified a dispute;
- An allocation of the lowest possible IDPR rating in July 2014;
- Various disputes between the employee and BHP, from September 2014 to April 2015, regarding the IDPR and PIP which were later settled confidentially between the parties through the Commission;
- A lengthy absence from work in 2015, due to personal illness and leave;
- The commencement of a six-month PIP from December 2015, with two different, new supervisors, including six meetings and an incident resulting in a formal written warning; and
- An unsuccessful completion of his PIP.
BHP’s PIP process consisted of six categories: respect; showing initiative; problem solving; task completion; 1SAP (a software program); and performance. It stated that ‘the employee will be given a minimum period of six months under the improvement plan to demonstrate satisfactory standards’.
After the unsuccessful completion of PIP, the employee was terminated and he later filed for unfair dismissal.
Dispute on the performance improvement process:
The employee stated he had been informed of the PIP but it was not sufficiently explained that he would be required to submit evidence of his improving performance before or during his monthly review. During the later PIP meetings, the employee began providing large amounts of evidence of his performance but felt he was not being listened to.
The employee stated he expected positive reviews at all PIP meetings as no one had raised any negative issues with him. He contended that he was not told how he could improve. During the process, the employee received a formal warning for acting aggressively and speaking to his supervisor with a raised voice. The employee stated he was unable to dispute any matters to do with his PIP because of the Settlement Deed that he entered into with BHP in 2015.
Commissioner Hunt heard from BHP that the employee’s termination was the result of a long and fair process aimed at improving his performance and behaviour up to the expected standard for all mine workers.
BHP submitted that the reasons for dismissal involved a failure to complete the PIP process, ongoing concerns over behaviour, poor performance and workplace problems and that the employee exhibited an obstructionist attitude in his work approach and made continual challenges to his supervisors and their attempts at improving his work performance.
BHP stated they had provided the employee with the information he needed to complete the PIP, and that at any point the employee could have sought clarification if he was unable to understand the procedure.
“While [the employee’s] service was lengthy, long service is not a shield that can be used to excuse sustained poor performance.” BHP contented.
The employee was dismissed after an almost seven-month-performance-management process.
Failure to improve ‘a valid reason’
In his decision, Commissioner Hunt did not find that termination was unfair in regards to the employee’s continued poor performance over a six month period.
Further, he found BHP’s concerns with the employee’s behaviour and conduct regarding a number of incidents during this time further supported the dismissal and the employee’s failure to satisfactorily fulfill the PIP review constituted a valid reason for his dismissal.
“BHP engaged in a genuine, thorough and lengthy performance improvement process,” the commissioner found. “I do not consider it was orchestrated in any way to be conductive to [the employee] failing the review.”
The commissioner noted that the employee “had been heavily involved in disputation with BHP throughout 2014, and 2015”.
“He ought to have known his performance over the sixth month PIP review period would be carefully reviewed,” he said.
Despite the lengthy service of the employee, Commissioner Hunt found it was outweighed by the employee’s failure to improve his performance, despite the robust opportunity to do so afforded to him by BHP.
Implications for employers:
BHP Coal followed their discipline policy and procedure, took all precautions to ensure that its performance management process was transparent and fair, and that all communication was meticulously recorded.
These actions ultimately contributed to the Fair Work Commission ruling in its favour and dismissing the former employee’s application.
Having a detailed performance-management process that is recorded at all stages, and involves multiple people mitigates the risk of a successful unfair dismissal claim.
In light of this decision, AMMA strongly encourages members to ensure their discipline processes involve multiple stages, and that evidence is kept of all communication, feedback and incidents. This evidence will be critical if a dispute arises.
An effective discipline process should aim to improve employee performance, while protecting the interests of the employer.
AMMA’s Workplace Relations Consultants are specialists in performance management, disciplinary and termination processes. Members seeking to implement a more secure performance management procedure should contact their local AMMA office for support.