FWC reinstates Sydney Trains worker after positive drug test

Workplace safety isn’t just about hard hats and high-vis vests; it’s about protecting employees from risks you can’t always see. Alcohol, recreational drugs, and even everyday medications can impair judgement, impact employee conduct, slow reactions, and put lives at risk. Whether it’s prescribed, over the counter, or otherwise, substances that affect a person’s ability to work safely can lead to devastating consequences.

The 2023 Fair Work Commission (FWC) case of Reece Goodsell vs. Sydney Trains highlights an important lesson for all employers. While zero-tolerance workplace drug and alcohol policies are essential for ensuring safety, they must also be fairly communicated and consistently enforced. The ruling in the Sydney Trains case underscores the importance of balancing safety with fairness and procedural integrity.

Here, we break down the details of the case, the FWC’s decision, and the key takeaways for business leaders. So, let’s get into it…

Annual leave, a poor decision, and a zero-tolerance policy: the details of the case

Reece Goodsell, a 26-year veteran of Sydney Trains, was dismissed after failing a random drug test that detected benzoylecgonine, a metabolite of cocaine, in his system. Having returned to work on 4 June 2022, after taking eight days of annual leave, he tested positive at a concentration above the Australian Standard threshold. Mr Goodsell admitted to using cocaine socially during his leave, believing it would be out of his system upon his return. Despite a spotless work record and no evidence of impairment while at work, Sydney Trains cited its Drug and Alcohol Policy to justify his dismissal on the grounds of safety.

Reinstatement was the decision of the Fair Work Commission

The FWC found that while the termination for drug use was technically based on a valid policy breach, it was unnecessarily harsh. The FWC concluded that employers must prove that workers who fail drug and alcohol tests pose a risk of impairment to satisfy dismissal. In this case, there was no evidence of impairment or safety risk, and the decision-makers failed to consider mitigating factors, including Mr Goodsell’s remorse and long-standing safety record. The FWC ordered his reinstatement with adjustments for lost pay. The ruling underscored procedural shortcomings, such as a lack of clarity in policy communication and Sydney Trains’ failure to appropriately tailor its disciplinary measures to the situation.

The appeal

Syndey Trains appealed the decision and in October 2024, the full bench of the FWC dismissed the appeal and confirmed the decision handed down by the FWC in 2023.

However, whilst the full bench of the FWC upheld the reinstatement of Mr Goodsell, it clarified that there is no authority or principle that in cases involving dismissal for breach of a drug and alcohol policy, an employer must establish a risk that an employee dismissed for returning a positive drug test in breach of such a policy was impaired at work. The full bench also said that a “finding as to whether a particular employee dismissed for breaching a drug and alcohol policy was or was not impaired at work, may be relevant to the question of whether a dismissal is unfair but a conclusion that a dismissal is not unfair does not require a finding that there was a risk of impairment.”

So, while the full bench upheld the reinstatement of Mr Goodsell, it confirmed that the FWC erred in its conclusion that employers must prove that workers who fail drug and alcohol tests pose a risk of impairment to satisfy dismissal. Instead, the full bench said that:

“Contextual matters cannot derogate from the validity of a reason for dismissal based on a breach simpliciter of a lawful and reasonable policy. This involves a decision-making process whereby the validity of a reason for dismissal under s. 387(a) is considered separately from mitigating factors found to be relevant under s. 387(h). All the matters in s. 387 – substantive, procedural and contextual – are then required to be considered and weighed in the overall assessment of whether a dismissal is harsh, unjust or unreasonable. Notwithstanding a finding under s. 387(a) that there was a valid reason for dismissal related to breach of a drug and alcohol policy, it may be reasonably open to the Commission to find that in all the circumstances of a particular case, the dismissal was unfair, when other matters in s. 387 are considered and weighed, including mitigating factors in s. 387(h).”

The four key lessons for every business owner

1. Clear and concise communication of policies: employees must fully understand workplace policies, especially those involving drug and alcohol testing. Ensuring that businesses explicitly explain how testing works, what thresholds mean, and the consequences of breaches in clear, straightforward training and materials can prevent misunderstanding.
2. Tailoring policies to workplace risks: tailoring your workplace policies to your specific business risks will ensure fairness and maintain safety standards.
3. Fair and just processes are essential: considering and reviewing all relevant factors, including mitigating circumstances, during disciplinary investigations can help ensure that workplace drug policy enforcement is fair and just. Doing this will help you steer clear of a one-size-fits-all approach that can be detrimental to an employee misconduct investigation and the business in the long term.
4. Embrace genuine consideration: decision-making when it comes to disciplinary measures in employment should be flexible and fact-driven, avoiding rigid adherence to predefined outcomes. Transparent, context-aware disciplinary processes build trust and strengthen employee cooperation.

The FWC’s decision demonstrates the need for employers to balance policy enforcement with fairness and flexibility. While safety is paramount, particularly in high-risk industries, the case shows that overly strict or poorly communicated policies can lead to unnecessary dismissals and legal challenges. Business owners should focus on building policies that are clear, fair, and practical, ensuring a workplace culture that supports both safety and procedural integrity.

How Citation HR can help

Employers should also ensure employees are aware of all policies that apply to them, including drug and alcohol policies. This includes communicating any new or amended policies to staff and ensuring you have a process in which the employee signs off that they’ve read and understood the policy. Having the employees sign off is vital in proving that the employee was aware of the policy’s existence and, therefore, was bound by it. That’s where we come in. Citation HR Software allows you to create and distribute policies so employees can read and acknowledge them. Plus, it keeps a record of who has acknowledged the policy – should you ever need proof if a claim arises.

Not a Citation HR client? To learn more about how Citation HR can help support your business and streamline its people management, contact our friendly team for a confidential, no-obligation chat.

About our author

Amanda Curatore is a qualified Senior Associate at Citation Legal and Citation HR. Amanda is highly experienced in providing workplace relations advice and assistance to clients in a wide range of matters including employment contracts, modern award interpretation, managing performance, bullying and harassment, terminations and managing risk. Amanda is also a Nationally Accredited Mediator through the Australian Mediation Association.