Court of Appeal rules on ill-health retirement discrimination

On 2 November 2012, the Court of Appeal dismissed an appeal brought on behalf of the Department of Community Safety (DCS) against a decision of the Queensland Civil Administrative Appeal Tribunal (QCAT) that found there was no inconsistency between the provisions of the Public Service Act 2008 and the Anti-Discrimination Act 1991.

The first respondent was employed by DCS as a Probation and Parole Officer. In April 2011, the officer was directed to attend an independent medical examination under s 175 of the Public Service Act. Following receipt and consideration of the independent medical examination report, the officer was invited to show cause as to why she should not be ill-health retired.

The officer lodged a complaint of unlawful discrimination with the Anti-Discrimination Commission Queensland on the basis of impairment after she had received the show cause notice but before any decision had been made as to whether she should be medically retired. One of the grounds of the complaint to the Commission was that the direction to attend the independent medical examination itself was discriminatory.

At the time of lodging the complaint with the Commission, the officer also applied to QCAT for an injunction restraining DCS from continuing with the ill-health retirement process until the complaint of discrimination had been settled through negotiation or heard by QCAT.

QCAT Senior Member Clare Endicott initially dismissed the application for injunction on the basis that, as Chapter 5, Part 7 of the Public Service Act was inconsistent with and therefore impliedly repealed the relevant provisions of the Anti-Discrimination Act, there was no valid complaint and therefore no jurisdiction to grant the injunction.

The officer’s appeal to the Appeal Tribunal was allowed. The Anti-Discrimination Commissioner was granted leave to intervene in the appeal to the Appeal Tribunal. The Anti-Discrimination Commissioner was the second respondent in the Court of Appeal.

After Senior Member Endicott delivered her decision, DCS determined that the officer should be ill-health retired from the public service. An appeal was lodged in the Court of Appeal against the decision of the Appeal Tribunal.

At issue before the Court of Appeal – and in the earlier proceedings – was whether Chapter 5, Part 7 of the Public Service Act impliedly repealed and excluded the provisions of the Anti-Discrimination Act concerning discrimination in employment on grounds of impairment.

It was the State’s submission that action taken under Chapter 5, Part 7 of the Public Service Act was inconsistent with the Anti-Discrimination Act and, as a later enactment, impliedly repealed the relevant provisions of the Anti-Discrimination Act. The State was represented before the Court of Appeal by the Solicitor-General, Walter Sofronoff, and Dr Max Spry of counsel.

In its decision, the Court of Appeal noted that Chapter 5, Part 7 of the Public Service Act creates two distinct powers for employers.

The first is the power under s 175 of the Public Service Act, which is to appoint a doctor and require an employee attend an independent medical examination. The power to send an employee to an independent medical examination under s 175 only arises when the circumstances listed in s 174 are met, namely there is a reasonable suspicion that an employee’s absence or unsatisfactory performance of their duties is caused by a mental or physical illness or disability.

The second is the power under s 178, which is the power to, on receipt of the report, transfer, redeploy or take other action in respect of the employee, including retirement.

“The State argued that as the power to direct an employee to attend an independent medical examination is only enlivened when the circumstances in s 174 are met, namely there is a reasonable suspicion that the employee’s absence or unsatisfactory performance is caused by an impairment, that the direction is clearly discriminatory as it can only be given to an employee because of an actual or suspected impairment,” the Assistant Crown Solicitor of our Workplace Law Team, Samantha Kane, said.

“It then follows that the power to direct an employee to attend an independent medical examination under s 175 cannot be reconciled with the provisions of the Anti-Discrimination Act which prohibit less favourable treatment of an employee in their employment on the basis of their impairment,” she said.

Significantly, the Court of Appeal confirms that it is not discrimination for the purposes of the Anti-Discrimination Act to direct an employee to attend an independent medical examination under s 175 of the Public Service Act.

The Court of Appeal expressly stated that the exercise of power under s 175 of the Public Service Act “cannot sensibly operate in conjunction with s 15 [of the Anti-Discrimination Act]”, which prohibits less favourable treatment in employment.

The effect of the decision with respect to the power under s 175 is that employing agencies should have good prospects of defending any complaint or resisting an application for an injunction lodged by an employee who has only received a direction under s 175 of the Public Service Act to attend an independent medical examination.

“This means that, consistent with the first power contained in Chapter 5, Part 7 of the Public Service Act, employing agencies will still be able to obtain independent medical examination reports about employees,” Samantha said.

However, with respect to the second power contained in Chapter 5, Part 7, which enables a decision-maker to take action on receipt of the independent medical examination report, the Court of Appeal found there was no difficulty in reading the power in s 178 with s 15 of the Anti-Discrimination Act. The Court of Appeal relied on the various exemptions in this Act that it found could be reconciled with the exercise of power under s 178.

As a result, employees may still lodge complaints of discrimination when they are given notice to show cause why they should not be transferred, redeployed or retired under s 178 of the Public Service Act. There is also a risk that employees who have received notices to show cause why they should not be transferred, redeployed or retired under s 178 will lodge applications for injunctions seeking to restrain their employer from making the proposed decision.

The effect of the decision means that although employing agencies can lawfully direct employees to attend independent medical examinations and can lawfully obtain independent medical examination reports from independent specialists, employing agencies may still face legal action, including complaints of discrimination and applications for injunction, from employees who are given notice to show cause why they should not be ill-health retired, transferred or redeployed.

Employers are significantly restrained in their ability to exercise the second power given in Chapter 5, Part 7 of the Public Service Act and, as a consequence, are significantly impeded in their ability to manage employees who, as a result of an impairment, are absent from duty or not satisfactorily performing their duties.

Our Workplace Law Team specialises in anti-discrimination cases, industrial relations, workplace health and safety, workplace harassment, union coverage, misconduct, discipline and dismissals.

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