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When does a person become a prospective employee?

By Kristin Ramsey02 Jul 2012

In a recent decision, the Federal Magistrates Court shed some light on the operation of the general protections provisions in respect of prospective employees, confirming that a person would not usually be regarded as a ‘prospective employee’ unless they had actually made an application for employment or were negotiating in relation to possible employment.

Referring to a string of Federal Court decisions, Federal Magistrate Cameron noted that the expression prospective employee ‘implies a substantial degree of proximity such as to exclude persons who might yet apply for employment or be invited to consider employment with a particular employer but at the relevant time were not yet negotiating in relation to such a possibility’.

The case concerned (Vij v Cordina Chicken Farms Pty Ltd (2012) FMCA 483) was an unusual one whereby a labour hire employee was arguing that they were a prospective employee of the entity utilising the hired labour (Cordina) by virtue of the fact that Cordina had held out the potential for direct employment in circumstances where a person performed well. Federal Magistrate Cameron rejected this argument and found that the person was not a prospective employee of Cordina and therefore that their adverse action claim (which related to discrimination) must fail.

The decision is a welcome relief to employers who are already concerned about the extent of protections afforded to prospective employees following a recent decision of Fair Work Australia permitting a person to make an unfair dismissal claim in circumstances where they had not yet actually started performing work for the employer (see Ksenija (Sonya) Belaj v Royal Women’s Hospital (2012) FWA 4067).

Both decisions are an important reminder of the very real obligations businesses have towards prospective employees.

Such obligations include ensuring that:

  • adverse action is not taken against a prospective employee (by either refusing employment or discriminating in the terms and conditions offered) because of the prospective employee’s workplace rights, industrial activities and/or on other discriminatory grounds;
  • prospective employees are not discriminated against (for example by refusing to employ them or in respect of the terms of employment offered) as a result of a ground protected by anti-discrimination legislation (for example age, sex, physical or mental disability); and
  • prospective employees’ personal and sensitive information is collected, handled, used and stored in accordance with privacy legislation.

In order to help reduce potential legal claims businesses need to:

  • ensure that staff involved in recruitment are appropriately trained on their obligations in respect of adverse action, anti-discrimination and privacy;
  • ensure that appropriate recruitment policies and procedures are in place; and
  • consider their approach and policy in respect of advising unsuccessful job applicants of the reasons why their application was unsuccessful.

In addition, to avoid claims similar to those made in the Royal Women’s Hospital case, businesses need to ensure that contracts of employment for new starters expressly state the date on which the employment commences and/or that employment does not in fact commence until the employee first attends for work.

Our workplace relations team can help businesses meet their obligations in this area by preparing or reviewing policies and procedures, providing training to relevant staff members and providing practical advice on real situations.