Former FFI exec Paul Scanlan sues after allegedly being sacked for making bullying complaints

Andrew Forrest’s green hydrogen subsidiary is again at the centre of claims of toxic culture, with a former senior executive suing over claims he was sacked for complaining.

A former senior executive of Andrew Forrest’s Fortescue Future Industries is suing Fortescue for unfair dismissal. Picture:Tony McDonough

A former senior executive of Andrew Forrest’s Fortescue Future Industries is suing Fortescue for unfair dismissal, alleging he was sacked for complaining about bullying and harassment at the company and after being falsely accused of leaking information to The Australian.

In documents filed with the Federal Court in Perth last week, former soldier Paul Scanlan – who was Fortescue’s Intelligence and Security Principal until his employment was terminated on Christmas Eve, 2021 – also alleges he was unfairly sacked for challenging a decision not to award him bonuses under the company’s staff incentive plan.

Mr Scanlan is suing the company for the unpaid bonus, loss of earnings since his dismissal, as well as “humiliation, hurt and distress”.

According to the documents, Mr Scanlan alleges he was sacked after making “complaints and inquiries” into the non-payment of a staff bonus for the 2020 to 2021 financial year, and after complaining he had been bullied and harassed in the workplace and intended to seek legal advice over his concerns.

The documents do not give details of the alleged bullying and harassment.

Mr Scanlan also alleges Fortescue issued a termination notice without affording him procedural fairness and partly relied on a false allegation that “the applicant had spoken to The Weekend Australian (which he had not), without any or any satisfactory evidence”.

The timing of Mr Scanlan’s dismissal suggests he was sacked after the Australian published a series of critical articles about Fortescue Future Industries, including allegations of a chaotic culture, bordering on toxic, characterised by FFI staff as being like “The Hunger Games”.

Mr Scanlan was not a source of the stories.

When The Australian put the allegations of a toxic culture at FFI to Mr Forrest in December, the mining magnate defended the way the company was being run, saying creativity would be the key to the hydrogen company’s plan to challenge oil and gas companies as the biggest energy suppliers in the world.

“You do not get results and creativity from disciplined, predictable organisational structures. You get the greatest results and greatest creativity from a level of disorganisation,” he said in December.

Mr Scanlan’s period of employment as a senior security manager Fortescue suggests he was at least partly responsible for security during chairman Andrew Forrest’s whirlwind deal making tour of the world in early 2021, as the company signed up to assess a slew of hydrogen and renewable power projects.

In the initial tour Dr Forrest took a team of executives on a whirlwind tour of almost 50 nations, including security hot spots such as Afghanistan and Democratic Republic of Congo.

In November 2021 The Australian estimated the cost of building that first tranche of projects at about $US195bn, and tens of billions more has since been added to that total.

In late March Fortescue was forced to walk back comments made by Dr Forrest that a major German hydrogen project could cost $US50bn ($66bn) after the ASX queried the company’s level of disclosure to ­investors.

The comments about the potential costs were made to journalists by Dr Forrest when announcing the project, but an ASX query to Fortescue forced the company to issue a clarification saying that there “was no commitment to this expenditure”.

“The expenditure described is a high-level assessment by the chairman of what such a major project may cost and is appropriate in the environment the statement was made to provide context and scale of the potential of the MOU,” Fortescue said in an ASX statement.

Complaints over Fortescue’s failure to pay bonuses under its short-term incentive scheme also led to the departure of a raft of senior managers in the company’s iron ore business, with the company losing a substantial number of senior managers and executives over the last 18 months.

Since early 2021 Fortescue has lost more than half of its 11-member executive leadership team.

Chief executive Elizabeth Gaines announced her intention to leave the company in December, and FFI director of energy Rob Grant left the company shortly before Christmas, as did the general manager of operations at Fortescue’s Iron Bridge magnetite project in the Pilbara, Luke Fitzgerald.

Before that, chief operating officer Greg Lilleyman, projects director Don Hyma, government affairs chief Tim Langmead and health and safety director Rob Watson all resigned.

In early 2021 corporate affairs director Alison Terry also left the company.

Lawyers for Mr Scanlan declined to comment as the matter is before the courts.
A spokesperson for FFI said: “The person concerned no longer works at our organisation. We do not provide comment on the reasons behind departures. We respect the privacy of our employees, past and present, at all times”.