fire & emergency services - ml&c collections · v waterbook (2009) nswca 224. examples of losses...

update

0� Maddocks Fire & Emergency Services Update

FEbrUary 2011

Fire & Emergency Services

What happens if an employee or volunteer posts disparaging comments on facebook or social media?

austral ian courts have recent ly been considering the legal issues associated with employees posting disparaging comments about an employer on Facebook. In this article we consider the case of Fitzgerald v Escape Hair [2010] FWa 7358) and make some recommendations about the issues that managers at ESOs should consider when addressing any such posts by employees or volunteers.

FItzgErald v EScapE HaIr

Ms Fitzgerald was employed as a hairdresser by Ms Smith in Escape Hair design (Escape) and was dismissed from her employment in early 2010. there were a number of reasons for her dismissal which included a public display of dissatisfaction with Escape posted on Facebook. the tribunal considered the other factors were not relevant to her dismissal and had to consider whether her Facebook post was a valid reason to terminate her employment.

In december 2009, Ms Fitzgerald posted the following comment on her Facebook page:

“Xmas “bonus” along side a job warning, followed by no holiday pay!!!! Whoooooo! The Hairdressing industry rocks man!!! AWSOME!!!” [sic]

the comment was posted on Ms Fitzgerald’s Facebook page after she received a christmas bonus that was smaller than what she had anticipated, and after there had been a dispute about the payment of holiday pay. the posting was accessible to Ms Fitzgerald’s Facebook friends. the evidence suggested the comment remained on the site for approximately two weeks before it was taken down. there was evidence that approximately 5-10 of Ms Fitzgerald’s clients (and therefore clients of Escape) were amongst Ms Fitzgerald’s Facebook friends.

in this issueWHat HappEnS IF an EMplOyEE Or vOlUntEEr pOStS dISparagIng cOMMEntS On FacEbOOk Or SOcIal MEdIa?

gUIdancE FOr ESOS On cOnSEqUEntIal lOSS claUSES In cOntractS

MOdEl OH&S rEgUlatIOnS avaIlablE FOr cOMMEnt

ESO SEMInar UpdatE

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cOnSIdEratIOn by tHE trIbUnal

In deciding whether or not there was a valid reason for dismissal the tribunal considered earlier case law (Rose v Telstra) as to the situations in which an employer is entitled to consider out of hours conduct. the common law position is that termination of employment for conduct occurring outside of work hours should only be permitted where:

the conduct was likely to cause serious damage to the employment relationship; orthe conduct damages the employer’s interests; orthe conduct is incompatible with the employee’s duties as an employee.

In the Fitzgerald v Escape case commissioner bissett noted that:

“a Facebook posting, while init ial ly undertaken outside working hours, does not stop once work recommences. It remains on Facebook until removed, for anyone with permission to access the site to see. a Facebook posting comes within the scope of a Rose v Telstra consideration but may go further. It would be foolish of employees to think they may say as they wish on their Facebook page with total immunity from any consequences.”

the tribunal noted Ms Fitzgerald’s comments were ‘silly’. It found, however, that the conduct did not provide a valid reason for dismissal. the tribunal noted that:

Ms Fitzgerald did not name the salon where she worked;there was no suggestion that there was other information available on Ms Fitzgerald’s webpage that could identify Escape;the comments did not adversely affect the hairdressing industry or Escape.

the tribunal noted that Ms Fitzgerald’s conduct in posting the comments on Facebook could affect the trust and confidence between employer and employee. However Escape’s delay of two months in taking any action in

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FEbrUary 2011


respect of the comments suggested that the relationship was not destroyed by the making of the comments.

ISSUES FOr ESOS

this case demonstrates that it is not merely the fact of posting a negative comment on Facebook or twitter that may attract legal consequences. If an employer or volunteer is to face disciplinary action (including termination of employment or their volunteer status) a court will consider in some detail the content of the posting and its context.

the legal consequences will depend on the wording used, the format of the posting and the intended and actual audience and the perceived gravity of any breach of trust or confidence. the legal rights of an employer to discipline or terminate an employee or volunteer will also depend on your relevant state public sector legislation and code of conduct, the extent to which any content posted could be said to be covered by the constitutional protection of political free speech and the terms of your employment arrangements.

as such your ESO should have a flexible and up to date policy about what is and is not acceptable use of social media by employees and volunteers who chose to comment about an ESO or emergency operations.

you should ensure your policy is broad enough to cover:

a senior employee who posts information about a confidential matter (such as about a criminal investigation) on Facebook;a volunteer who tweets to criticise a public information warning issued by their ESO, and whether or not it is relevant that the tweet is picked up by the media;a discussion on a publicly available blog where a number of employees and volunteers criticise their ESO, and potentially defame senior managers;a volunteer who posts a potential ly discriminatory comment about a fellow volunteer on their Facebook page;a disparaging Facebook post about ESO policies by an employee who does not name their ESO, but who is very well known within the ESO and has many fellow employees as Facebook friends; or

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an employee who, after a bad day at work, tweets a defamatory criticism of others in their unit or brigade.

lESSOnS

ESOs should have detailed policies about use of social media such as Facebook, and what is and is not acceptable in relation to postings and information about an employee or volunteer’s ESO. ESOs may be able to take action against an employee or volunteer who posts information about his or her employment or volunteer activities on Facebook or other sites.the nature of the comment posted and the detail provided will be important considerations in determining whether or not the posted comment provides a basis for disciplinary action or dismissal.

n e W i n t e r p r e t a t i o n o f ‘consequential loss’ and its effect on contract exclusion clauses

ESOs purchasing services under contract should be aware of recent judgements of the victorian and new South Wales courts of appeal which signal a change in the courts’ approach to clauses excluding liability for consequential loss.

In Environmental Systems Pty Ltd v Peerless Holdings Pty Ltd (2008) vSca 26 (Peerless), the victorian court of appeal held that a clause limiting a supplier’s liability for consequential loss excluded both liability for:

loss arising naturally from a breach of contract; andloss reasonably within the contemplation of the parties (at the time of forming the contract) as being a probable result of the breach.

this is a notable departure from the previous line of authority dealing with the interpretation of consequential loss clauses, under which ‘consequential loss’ was not taken to extend to loss arising naturally from a breach of contract. the effect of the peerless decision is a that a number of different costs and expenses that were previously not considered to be covered by a contract clause excluding liability for

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‘consequential loss’ may in fact now be covered by such a clause. this means that those losses would now be excluded and not recoverable.

the decision in peerless has since been adopted by the nSW court of appeal in Allianz v Waterbook (2009) nSWca 224.

Examples of losses that may now be excluded unless they are expressly referred to in the contract could include:

losses incurred by an ESO resulting from a negligent building or repair job meaning that a building is uninhabitable for use;costs and expenses incurred by an ESO in procuring substitute goods or services from another supplier;costs of implementing workarounds or temporary solutions where a computer system repeatedly fails;internal administrative costs incurred in managing a supplier’s failure.

WHat tHIS MEanS FOr yOU:

Excluding liability for ‘consequential loss’ may now mean excluding liability for some losses that would otherwise be recoverable. ESOs purchasing goods or services under contracts should be careful about including in the contract a generic provision excluding liability for consequential loss without specifying clearly what ‘consequential loss’ means. If the types of loss that each party will be liable for are not specified, you may be agreeing to waive your rights to recover a broader range of costs than anticipated if the supplier breaches the contract or is negligent. Existing precedents should be examined to identify generic clauses excluding liability for consequential loss and those clauses should be reconsidered, with particular consideration given to:

whether the ESO should agree to exclude a supplier’s liability for consequential loss at all; andif an exclusion clause is considered reasonable, specifying the specific types of consts and expenses that are excluded by the clause.

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model oh&s regulat ions available for comment

Safe Work australia has released model Workplace Health and Safety regulations and model codes of practice for public comment. this release is part of the introduction of uniform model legislation which became law in most states of australia on 1 January 2011. the position in Western australia and new South Wales remains unresolved.

the draft regulations, which run to nearly 600 pages, address various topics including consultation, working in confined spaces, hazardous chemicals, asbestos, major hazard facilities and the duty to prepare emergency plans. they will replace the current state based regulations.

twelve draft codes of practice were also released addressing:

Management of workplace health and safety;consultation;Management of work environment and facilities;Facilities for construction Sites;Management of noise;Hazardous manual tasks;confined spaces;Management and control of asbestos;removal of asbestos;Fall prevention;labelling of hazardous chemicals; andpreparation of safety data sheets for hazardous chemicals.

If your ESO is interested in providing feedback on the draft regulations and codes you can do so via www.safeworkaustralia.gov.au until 4 april 2011. We recommend that you address:

whether the draft documents provide sufficient clarity to your ESO;

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whether or not there is sufficient guidance on what is reasonably practicable to do in the situations in which ESOs operate;any there are any inconsistencies between the Model act, the regulations and the codes of practice that raise concerns for ESOs; and whether the regulations or codes are incapable of application to your workplaces, or if any exceptions are appropriately worded.

eso seminar update

the final Maddocks emergency services seminar for 2010 was held on Wednesday, 8 december 2010. James Smart and Michelle burridge presented on how to manage risk and liability in emergency services contracts. Some of the issues that James and Michelle spoke about included:

how best to manage risk and apportion liability in emergency services projects;outcomes to be achieved by different indemnity clauses; andkey issues to consider with indemnity clauses such as liability caps and exclusions, legislation and government policies and insurance.

the message from the seminar is that government bodies like ESOs are operating more and more in a commercial environment and there are potentially significant consequences if a contract fails. While the focus in pre-contract negotiations often revolves around the specifications, kpIs and how to ensure performance of the contract, it is also important to think about what can occur if something goes wrong. this involves considering how the matter should be addressed in a practical sense but also importantly how risk and liability should be apportioned. this should be done bearing in mind what are the key risks in the project, which party is best placed to manage those risks and what insurance is in place as well as relevant government policies and guidelines. an indemnity clause that fits the

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specific risk profile of the relevant project and that is expressed in clear terms should be used.

please contact us if you would like a copy of the slides from the presentation.

catherine dunlop is presenting on some of the communications issues arising from the findings of the 2009 victorian bushfires royal commission at the apcO australasia conference at 4.00 pm on tuesday 22 February 2011 in Melbourne.the next Melbourne seminar in our Emergency Services seminar series will commence at 8am on 1 March 2011. catherine dunlop will address what the new occupational health and safety legislation will mean for ESOs. Our June breakfast seminar is scheduled for 1 June 2011 and it is intended we will address the recent changes to the operational and community safety powers and duties of ESOs in victoria.details of our Sydney Emergency Services seminar series for 2011 will be available soon.

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The material contained in this Update is of the nature of general comment only. No reader should rely on it without seeking legal advice. If you do not wish to receive further Updates from us, please email [email protected].

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maddocks fire & emergency servicesFor further information regarding any of the articles in this Update, please contact a member of our team below:

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fire & emergency services - ml&c collections · v waterbook (2009) nswca 224. examples of losses...

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