For employers, few areas of employment law carry as much hidden risk as general protections (adverse action) claims.
Our employer lawyers regularly act for employers facing adverse action claims triggered by routine HR decisions: performance management, restructures, disciplinary action, and terminations.
The common thread? Poor timing, documentation gaps, or unclear decision-making processes. This article explains how adverse action claims arise, why employers often lose them, and how to manage workplace complaints lawfully and defensibly.
Key Takeaways
Employee complaints (formal or informal) are protected workplace rights under the Fair Work Act
Adverse action includes warnings, role changes, reduced hours, and other detrimental treatment – not just dismissal
Timing between a complaint and management action is a major risk factor for employers
Once adverse action is alleged, the employer bears the burden of proving the decision was unrelated to the complaint
A valid business reason will not protect an employer if the complaint influenced the decision in any way
What is an Adverse Action Claim (From an Employer’s Perspective)?
Under Part 3-1 of the Fair Work Act 2009 (Cth), employers must not take adverse action against an employee because they have exercised a workplace right.
For employers, the critical issue is this:
Even if adverse action is taken for multiple reasons, the claim succeeds if a prohibited reason was one of them.
Adverse action can include:
Termination of employment
Issuing warnings or disciplinary action
Demotion or role changes
Reduction of hours or pay
Altering duties to the employee’s disadvantage
Treating the employee differently to others
Read our related article Handling Workplace Complaints: Employer Guide to find out more.
The Most Common Employer Mistake: Retaliation by Perception
Many adverse action claims arise not from deliberate retaliation, but from how the decision appears.
Common scenarios include:
Escalating performance management immediately after a complaint
Changing reporting lines following bullying allegations
Excluding an employee from projects after raising concerns
Terminating employment during or shortly after an internal investigation
Even well-intentioned actions can look retaliatory if not carefully structured and documented.
Real-Life Employer Risk Scenarios
Example 1: Performance Management After a Complaint
An employee raises concerns about workload and unpaid overtime. Two weeks later, they are placed on a performance improvement plan for the first time.
Employer risk:
If performance concerns were not documented before the complaint, the employer may struggle to prove the decision was unrelated.
Example 2: Termination During an Investigation
An employee makes a bullying complaint against a manager. While the investigation is ongoing, the employer terminates the employee for “role redundancy.”
Employer risk:
Even a genuine redundancy may fail if decision-making appears reactive or poorly evidenced.
Learn more about workplace investigations.
Example 3: Disciplinary Action for “Conduct”
After making a safety complaint, an employee is disciplined for attitude or tone in communications.
Employer risk:
Vague conduct reasons are often viewed as pretextual when closely timed to protected activity.
Why Employers Lose Adverse Action Claims
Employers typically lose these claims due to:
Decision-makers referencing the complaint in internal discussions
Inconsistent evidence between witnesses
Lack of prior performance documentation
Overlapping investigation and disciplinary processes
Poorly framed termination letters
Importantly, courts assess the subjective reasons of the decision-maker, not what HR later says the reason was.
Best Practice for Employers: Managing Workplace Complaints Without Triggering Claims
Employers should:
- Treat complaints as neutral events
- Separate complaint handling from performance management where possible
- Pause major decisions unless genuinely urgent
- Document concerns before complaints arise
- Ensure decision-makers understand adverse action risk
- Obtain legal advice before termination following protected conduct
Early advice can often prevent claims entirely.
Managing a workplace complaint or potential retaliation claim? Get strategic advice from a trusted employment lawyer for employers to protect your business and decision-makers.
Consequences for Employers
General protections claims expose employers to:
Uncapped compensation
Civil penalties
Reinstatement orders
Significant legal costs and reputational risk
Unlike unfair dismissal claims, there is no minimum employment period, and senior employees are not excluded.
Concerned about adverse action or general protections risks? Speak with an experienced employer employment lawyer at Prosper Law before disciplinary action or termination.
Frequently Asked Questions
Can we discipline an employee after they make a complaint?
Yes – but only if you can prove the discipline is entirely unrelated to the complaint and supported by evidence.
Does an informal or verbal complaint count?
Yes. Informal, verbal, or internal complaints can still trigger general protections.
What if the employee is genuinely underperforming?
Underperformance must be documented before the complaint or supported by independent, objective evidence.
Can we terminate during an investigation?
It is high risk. Termination during or shortly after a complaint often leads to adverse action claims unless handled carefully.
How quickly do claims arise?
Dismissal-related general protections claims must be lodged within 21 days, often without warning.
Learn more about employer obligations in our guide to the Fair Work Act.
