Termination tactics go awry for revenue agency as litigation puts a cloud over the recruitability of a highly sensitive role.
Julian Bajkowski
MAY 22, 2025
The Australian Taxation Office has lost its attempt to propel a more-than-year-long legal battle over the termination of its chief information security officer (CISO) to the Federal Court.
It’s a case that has laid bare major ructions between the revenue agency and the man hired to protect highly sensitive data and the government infrastructure it sits on.
Tax last week had its application to boot the Fair Work case up a legal rung firmly batted-away by the Federal Circuit Court, a move that has put key details, including facts around the claims and action, into the open and on the public record.
The case revolves around an unfair dismissal action, under general protections, brought by former ATO CISO Alex Adams, whose LinkedIn profile states he joined the ATO in 2017.
In an ATO org chart dated March 2024, Adams is listed as the head of the ATO’s “Commercial Management and Cyber Security” division within the Enterprise Solutions and Technology Group, answering to second commissioner and chief information officer Ramez Katf.
The position of CISO was then a Band 2 Senior Executive Service one.
The Federal Court decision states that “Mr Adams used to be a deputy commissioner at the Australian Taxation Office (ATO), the first respondent. He was dismissed from that position on 8 May 2024.”
The timing of the revelation that the ATO removed its head of information security is less than ideal.
News Corp. publication The Australian has said that “hackers are harvesting potentially thousands of bogus tax returns as they exploit ongoing security weaknesses in the Australian Taxation Office’s online portal and the Commonwealth’s myGov system.”
The ATO subsequently responded that it is “aware of media reporting that the ATO has been ‘hacked’.”
“This is incorrect. The ATO’s systems are secure, resilient and have not been compromised,” the ATO said, adding that “the safety of taxpayers’ information is of the utmost importance to us, and the ATO continues to remain vigilant for new and emerging cyber threats.
“If an individual sees unusual activity on their ATO account, it may be related to identity theft. Identity information can be compromised in a variety of ways, including requests for information by malicious actors, phishing emails, large-scale data breaches, and individual device or home network hacking.”
The ATO’s statement issued May 19 said, “If an individual is found to be a victim of third-party fraud, we will work with them to fix their client account and remediate it to its true and genuine position. The ATO will then work to recover the monies.”
But finding a security guru is tough, keeping them tougher yet.
In 2025, the ATO revealed the CISO role had been elevated from Band 2 to Band 3 when it named its new chief information officer and CISO.
“I’m very pleased to announce the appointment of Mark Sawade as chief information officer and chief security officer (SES Band 3) of the Australian Taxation Office, effective 11 March 2025,” commissioner of taxation Rob Heferen told ATO staff.
“Mark is a highly regarded senior executive and is the substantive CIO at the Department of Agriculture, Fisheries and Forestry. He brings a wealth of expertise and experience from across the broader APS, including the Department of Education, the Department of Home Affairs, ComSuper, and the Australian Bureau of Statistics — making him ideally placed to lead the ATO’s technology and security functions.”
However, the CIO role was demoted from first commissioner.
What is still unresolved in Adams’ unfair dismissal claim is to what degree Section 24 of the Public Service Act, which deals with terms and conditions of employment, applies to Senior Executive Service employees, and how this interacts with general protections.
Both the ATO and Adams — through his counsel — were approached for comment. The ATO responded that it was inappropriate to comment on a matter still before the court.
The court decision said that Adams’ “statement of claim sets out allegations concerning the steps leading to Adams’ dismissal and canvasses alleged performance concerns, performance management and ultimately his dismissal on the stated ground of “unsatisfactory performance”. “
“It was further alleged that the PS commissioner took adverse action against Mr Adams by issuing a certificate for the termination of his employment, which constituted a dismissal, and also injured him in his employment, altered his position to his prejudice, discriminated between him and other employees and consisted of steps to organise further adverse action, specifically termination.
“[It] was contended that that alleged averse action was taken for reasons that were substantially the same as those alleged to have motivated the other, non-dismissal, adverse action referred to earlier.”
There are six respondents named in the action: the ATO, Ramez Katf (former ATO CIO and second commissioner), Alison Stott (deputy commissioner for ATO People), Chris Jordan (former commissioner of taxation), Rob Heferen (present commissioner of taxation) and APS commissioner Gordon De Browuer.
The reasoning for the dismissal of the ATO’s application to take the matter from Fair Work [Federal Circuit Court] was the question of whether any of the issues the ATO raised were of “general importance”.
“Although the APS is a large organization that performs many important functions, I am not persuaded that its industrial relations concerns are matters of general importance, in the sense that the present issues have not been shown to be of material relevance to anyone outside the APS,” Judge Robert Cameron found in the dismissal.
“A matter which is important to the APS is not necessarily a matter of general importance. I accept that a verdict for Mr Adams might, for a period, have disruptive consequences for the APS, but I am not persuaded that its significance would extend beyond the public sector or be of real interest to other persons apart from those with a curiosity about government and politics.”
The Taxation Officers’ Branch of the Australian Services Union said in communications to members that the ATO CISO role “is key and vital to protecting ATO systems and taxpayer information from external or internal attack. This is what makes the following revelations so concerning.”
“The ATO terminated Alex’s employment on 8 May 2024. In the steps leading up to this, the ATO held concerns about Alex’s performance, undertook performance management processes and terminated his employment on grounds of unsatisfactory performance. Alex made various complaints and enquiries in all this and took personal leave from 29 January 2024 until his dismissal from the ATO,” the ASU said.
“The ATO applied to have Alex’s case transferred to the Federal Court of Australia. Alex consented to the ATO’s application, but the Court needed to make its own decision. The hearing of the ATO’s application took place on 18 November 2024. The ATO submitted that if Alex’s arguments were accepted by the Court, it would expose the Commonwealth to liabilities it had previously considered did not apply to it,” the union continued.
“Unfortunately for Alex, Judge Cameron thought some of Alex’s case was vague and lacked relevant detail and particulars. The judge thought an ATO allegation in its application for a transfer to the Federal Court was deficient and speculative. The ATO provided no evidence in relation to relevant matters. The judge found that although the ATO claimed Alex’s case raised some complexity, it did not explain why the Circuit Court could not deal with the issues.”
ASU Taxation Officers’ Branch secretary Jeff Lapidos said in the bulletin to members that “Alex’s lawyers should learn a lesson from the Judge’s comments.
“They need to sharpen up their case if they wish to win. They now know the ATO and the APS will fight Alex’s case very hard. It seems to me that both sides of this argument have good reason to find a settlement.”
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