A recent case highlights key considerations when assessing reasonable adjustments for injured employees and offers insight into how tribunals determine remedies and outcomes.
A Victorian Council is on the hook for around $900,000 in damages after a tribunal found that an employee’s requests for reasonable adjustments to his work environment were declined, resulting in unlawful termination of his employment contract.
The long-standing employee – a local law officer – had sustained an injury five years earlier in a different role with the same employer.
While he recovered from the initial injury, it left him prone to headaches and neck and back pain, which were triggered by factors such as poor posture and sitting in certain positions for prolonged periods. His current role required extended periods of driving.
The employer decided to replace its vehicle fleet, transitioning from a larger van – which the employee had comfortably driven for a long time – to a smaller vehicle (an i30), as other employees preferred smaller cars for easier manoeuvrability.
The employee repeatedly sought permission to use a different vehicle, as the new employer-provided cars exacerbated his pre-existing injury. This led to a lengthy 15-month back and forth between the employee and the organisation, culminating in his termination.
“The definition of disability under the legislation is extremely broad and includes manifestations or features attributed to a condition, past disabilities, or any malfunction of the body or mind. It really captures a wide category of functional incapacity,” says Emma Lutwyche, Partner at Pinsent Masons.
There are plenty of important lessons for HR in this case, including the factors a court or tribunal will consider when assessing whether an organisation’s reasonable adjustment efforts were sufficient, how the tribunal arrived at such a substantial damages payout, and the key considerations to keep in mind if faced with a similar situation.
Lutwyche unpacks key takeaways from this case for HR.
Determining inherent requirements of the role
An important fact that worked against the employer in this case was that throughout the 15-month dispute, the employee continued to drive his preferred van without issue.
This proved he was able to perform the inherent requirements of the role, says Lutwyche.
“The Tribunal held that he could perform the role’s requirements – which were driving around and doing his job – rather than being as narrowly defined as driving a specific i30.”
An important distinction in this case, she adds, is that this VCAT decision applies Victoria’s Equal Opportunity Act, which characterises ‘inherent requirements of the role’ slightly differently. Instead, it uses the term ‘genuine and reasonable requirements.’
“The federal Disability Discrimination Act uses ‘inherent requirements.’ While the decision considers various case authorities, a different outcome might have been reached under a strict legal interpretation of the Disability Discrimination Act,” she says.
However, Lutwyche notes that the key HR lesson here is one of fairness.
“When HR goes through these processes, [they need to] consider what the actual requirements of the role are, which aren’t always explicitly written in a position description.
“For example, standing behind a counter might not be listed in a job description for a retail role, but the business knows it’s expected. The key questions are whether it is a ‘genuine and reasonable requirement’ under the Equal Opportunity Act, or an ‘inherent requirement’ under the Disability Discrimination Act. HR needs to help the business explore what those terms truly mean and ensure they are applied fairly.”
“HR often needs to challenge the business when told an adjustment “isn’t feasible” –Emma Lutwyche, Partner, Pinsent Masons.
What counts as reasonable adjustments?
Another key aspect of this case was the employer’s lack of a genuine attempt to make adjustments.
“The employer argued they had made reasonable adjustments by looking at other vehicles in their fleet and having medical assessments [about the employee’s capacity to drive] done,” says Lutwyche.
“They also claimed he never specified which vehicle he could drive – an argument the Tribunal rejected, as he had suggested a similar model to what he had been driving… which would have been reasonable.”
When the employer deemed neither of these options as reasonable, it didn’t then offer him the opportunity to test drive other vehicles or show genuine consideration towards leasing an additional, more suitable vehicle.
“The Tribunal was really critical of that,” says Lutwyche. “It also looked really closely at the Council’s budget and saw they were a million dollars under budget in that department for the year and around $40 million in budget surplus across the whole council.”
A tribunal considers a business’s operating environment when ruling on matters of fairness or reasonable adjustments, she adds.
“You look at the operations and resources of the business – what constitutes a reasonable adjustment versus ‘unjustifiable hardship,’ as defined in the federal act, depends on the specific circumstances of the organisation.
“The Council conceded that it may have cost up to $20,000 for four years to lease a different vehicle. Spending an extra $3,000 or $4,000 a year for his vehicle was [found to be] negligible compared to their operations.”
Additionally, the tribunal considered the costs of the three medical assessments the employer paid for, along with legal fees, which amounted to more than it would have spent leasing a new vehicle.
What do businesses need to keep in mind regarding reasonable adjustments?
Zooming out from this case, Lutwyche says there are a few different considerations for businesses to keep in mind when considering reasonable adjustments, such as:
- Considering the specific person in their own specific circumstances
- Gather robust medical evidence
“One of the positive things the employer did in this case was engage in a thorough process with extensive medical evidence back and forth.
“The employee presented medical evidence, which the employer tested through their own assessments – a process that can add real rigor. While this can sometimes create a complex and confusing volume of information to navigate, having more data about a person’s actual condition and functional capacity is ultimately better than having less.”
- Avoid any disciplinary action
“If there is a clear determination that a person can’t perform the inherent requirements of the role and no reasonable adjustments can be made, then an employer can lawfully terminate employment – that is an exception to disability discrimination. But where the business fell foul here was in not thoroughly evaluating what adjustments were possible.”
This is where HR’s influence and counsel is critical, says Lutwyche.
“HR often needs to challenge the business when told an adjustment “isn’t feasible”. It isn’t clear [in this case] whether HR asked, ‘Why can’t he drive a different car? Why can’t we lease a new vehicle for him? What would that actually cost?'”
As well as being the right thing to do by the employee, it also offers the business a paper trail to show a commission or tribunal all the avenues that were explored and the questions the business deeply interrogated before making a decision.
Management can often take a rigid view out of a desire for consistency or a belief an employee is difficult, she says, but disability accommodation isn’t a scenario where you can apply a blanket rule. HR should help the business understand how to make tailored adjustments.
“I’ve certainly seen clients where management insists, ‘Absolutely not – nobody else sits in a chair, it isn’t how things are done, and it won’t look good to customers.’ In that scenario, a tribunal or court would likely hold that providing a chair for a short period is entirely reasonable, unless there is a clear Work Health and Safety or security risk attached to doing so.”
“They sent three separate show cause letters over the period threatening termination, framing the core requirement not as driving for his job, but specifically driving a particular car – which is far too narrow an application of the role’s requirements.” – Emma Lutwyche, Partner, Pinsent Masons.
Show cause versus genuine consultation
The tribunal found that the three medical assessments the employer sent the employee to undertake were “essentially aimed at proving he couldn’t do the job”, says Lutwyche.
This shifted the situation towards a show cause process rather than a genuine consultation.
The process does not have to be perfect in terms of ironing out every single detail about what an employee needs, she says, but the employer must show they are listening to and consulting the employee on what is required to perform their role safely and productively.
“They repeatedly threatened his employment through a show cause process, asking, ‘If you can’t do this, why shouldn’t we terminate your employment?’ They sent three separate show cause letters over the period threatening termination, framing the core requirement not as driving for his job, but specifically driving a particular car – which is far too narrow an application of the role’s requirements.”
Breaking down the damages
The significant damages amount in this case – potentially $900,000 – was calculated from a position of economic loss rather than general compensation for discrimination, says Lutwyche.
“The tribunal ordered damages of $200,000 in past economic loss, which included $35,000 for discrimination, and directed the parties to engage in a compulsory conference to discuss reinstating the employee. This included negotiating what reinstatement would look like.
“Essentially, the tribunal said if they reinstated him, he would receive $200,000 in past economic loss. If they did not reinstate him, he would receive an additional $700,000 on the basis that he would have continued working.”
The employee is 65 years old, and gave evidence that he would have kept working until he was 72.
“Given there were no performance or other issues with his role, and that he’s been performing the role for a really long time, the tribunal accepted that he would have worked until that point.”
Lutwyche notes that the employee’s age likely played a part too, as it would have been more difficult for him to find work again.
“A younger employee would likely receive a lower economic loss component because they would be more likely to secure alternative employment.”
The council may appeal this case, she adds, noting they have 28 days from the date of the decision to lodge an appeal with the Victorian Supreme Court.
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Emma Lutwyche is a Partner at Pinsent Masons, employment law specialists.
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