Australian software giant TechnologyOne has won an unfair dismissal case after a decade of legal fighting and more than $10 million spent.

The Federal Court in late December dismissed former TechnologyOne employee Behnam Roohizadegan’s unfair dismissal claim, which alleged he had been fired from the tech firm in breach of the Fair Work Act after he made a series of bullying complaints.

It was the second time the case had been heard in the Federal Court, after a ruling in 2020 that Roohizadegan had been unfairly dismissed and should be awarded more than $5 million was thrown out and ordered to go to a retrial, which was held earlier this year.

In the second trial, the Federal Court judge found that the employee had been fired by the tech company due to performance issues.

Roohizadegan has already flagged that he will be appealing the decision.

Following the legal win, TechnologyOne founder Adrian Di Marco, who was a key witness in the case, said that the Fair Work Act needs to be reformed “as a matter of urgency” to prevent further protracted and costly cases.

The case

Roohizadegan was hired by Di Marco in 2006 as TechnologyOne’s Victorian regional manager, and was initially a “spectacularly successful employee”, the court found.

For the first seven years of his time at the tech firm, the licence fee revenue for the Victorian business unit jumped from $1.3 million to $10 million, and during that time Roohizadegan was an “exceptionally hard-working employee”, was sometimes working 18 hours per day, and received “much praise” from Di Marco, including winning a number of company awards.

But Roohizadegan’s relationship with the company soured when a new operating officer for sales and marketing became his boss in late 2014, and revenue in Roohizadegan’s area of the company “flatlined” after 2013.

While Di Marco was not initially concerned about this and Roohizadegan was even awarded the chairman’s award at the company in the 2014 financial year, by the first half of the 2016 financial year the founder was concerned that the Victorian region was on track to record no licence fee growth for the third year in a row, the court heard.

In 2016, Roohizadegan claimed he was bullied by a senior executive, with the original 2020 court ruling finding he was subject to abusive language and “gaslighting”.

In May 2016, he was invited to a meeting in Brisbane with Di Marco where he was told he was being fired from the company.

The judge found that Di Marco had decided to fire Roohizadegan in late April but delayed implementing this until he was sure that this would not jeopardise an important contract the company held with La Trobe University.

TechnologyOne founder Adrian Di Marco [pictured] had previously described Roohizadegan as a 'spectacularly successful employee'. Photo: Wikipedia

The judge rejected Roohizadegan’s argument that he had been fired for making the bullying claims, and found that Di Marco’s reasonings for the termination were “perfectly lawful” because they related to “well-established and documented poor performance”, a “persistent inability to accept decisions made by more senior managers” and a “damning assessment of morale and employee relations in the Victorian regional office”.

In the second trial, Roohizadegan was claiming compensation of nearly $55 million for economic loss plus $550,000 for general damages.

A lengthy trial

Roohizadegan faced 11 days of “intense and probing cross-examination”, the judge said, and he should be given a “fair degree of latitude” when considering his credibility during this time.

But the judge found that this does not fully explain the “multiple false statements that he made in evidence, his combative demeanour and his defensive and evasive evidence in general”.

The judge said that Roohizadegan was a “fabulist who told many transparent lies in his evidence which are incapable of rational explanation as honest but mistaken recollection or reconstruction”.

In assessing Di Marco’s credibility, the judge found that he “genuinely attempted to recollect historic events but had great difficulty in doing so due to the lapse of time”.

The judge found that Roohizadegan had been fired by Di Marco for poor sales performance and an inability to accept senior management decisions, dismissing the unfair dismissal case.

Not over yet

In a post on LinkedIn, Roohizadegan said that he would “strongly appeal” the decision.

“Under my leadership, Victoria was the highest performing region,” he said in the post.

“There was never any talk of poor performance review, and I was never put under performance management.

“On the day that TechnologyOne unlawfully terminated my employment, TechnologyOne never told me that they were sacking me because of poor performance.

“Today’s judgement is a sad day for all Australian workers by an obviously biased legal system.”

In a statement issued following the legal win, Di Marco said the lengthy and costly case should “deeply concern” Australian businesses, with more than $10 million spent defending it.

“The fact that compensation under the Fair Work Act is uncapped makes these cases very appealing to litigate, leading to huge court costs, and with some plaintiffs attempting to claim significant compensation,” Di Marco said in the statement.

Di Marco said there needs to be changes made to the Fair Work Act to prevent similar cases in the future.

“Employers are today reluctant to manage employee conduct or performance because of the litigation risk and costs associated with defending these types of claims under the Fair Work Act,” he said.

“If we want to be successful as a nation, we must have sensible and fair IR laws that support building high performing, accountable teams, and that improve rather than hinder productivity.

“We are seeing a significant backlog of these cases.

“The Fair Work Act is far from being reasonable or workable and must be fixed as a matter of urgency.”