1
Fair Work Act 2009
s.604 - Appeal of decisions
JBS Australia Pty Ltd
v
Mr Scott Challinger
(C2014/8360)
JUSTICE ROSS, PRESIDENT
VICE PRESIDENT HATCHER
COMMISSIONER CARGILL
MELBOURNE, 30 JANUARY 2015
Appeal against decision [2014] FWC 7963 of Commissioner Hampton at Adelaide on
15 December 2014 in matter number U2014/5789 - public interest not enlivened - permission
to appeal refused.
[1] Mr Scott Challinger (the respondent) was dismissed from his employment with JBS
Australia Pty Ltd (the appellant) on 3 March 2014 and subsequently lodged an application for
an unfair dismissal remedy pursuant to s.394 of the Fair Work Act 2009 (Cth) (the FW Act).
[2] In a decision issued on 30 September 20141(the first Decision) Commissioner
Hampton found that Mr Challinger’s dismissal was harsh and therefore unfair within the
meaning of s.385 of the FW Act. The Commissioner dealt with the question of remedy in a
subsequent decision issued on 15 December 20142 (the second Decision) in which he made an
order for reinstatement, continuity of service and to partially restore lost pay. The appellant
seeks permission to appeal the second Decision and that is the matter before us.
[3] The decision subject to appeal was made under Part 3-2 – Unfair Dismissal – of the
FW Act. Section 400(1) provides that permission to appeal must not be granted from such a
decision unless the Commission considers that it is in the public interest to do so. Further, in
such matters appeals on a question of fact may only be made on the ground that the decision
involved a ‘significant error of fact’ (s.400(2)). In Coal & Allied Mining Services Pty Ltd v
Lawler and others, Buchanan J (with whom Marshall and Cowdroy JJ agreed) characterised
the test under s.400 as ‘a stringent one’.3 The Commission must not grant permission to
appeal unless it considers that it is ‘in the public interest to do so’.
[4] The task of assessing whether the public interest test is met is a discretionary one
involving a broad value judgment.4 In GlaxoSmithKline Australia Pty Ltd v Makin a Full
[2015] FWCFB 520
DECISION
AUSTRALIA FairWork Commission
[2015] FWCFB 520
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Bench of the Commission identified some of the considerations that may attract the public
interest:
“... the public interest might be attracted where a matter raises issues of importance and
general application, or where there is a diversity of decisions at first instance so that guidance
from an appellate court is required, or where the decision at first instance manifests an
injustice, or the result is counter intuitive, or that the legal principles applied appear
disharmonious when compared with other recent decisions dealing with similar matters.”5
[5] It will rarely be appropriate to grant permission to appeal unless an arguable case of
appealable error is demonstrated. This is so because an appeal cannot succeed in the absence
of appealable error.6 However, the fact that the Member at first instance made an error is not
necessarily a sufficient basis for the grant of permission to appeal. 7
[6] In order to put the appellant’s submissions into context it is necessary to briefly deal
with the first Decision, in which the Commissioner found that Mr Challinger’s dismissal was
unfair.
[7] Mr Challinger was dismissed for a number of reasons8 including failure to comply
with a safety instruction to use a protective armguard, using inappropriate language towards
senior staff members and engaging in abusive and offensive behaviour. The major factual
issue in dispute in the proceedings at first instance was whether Mr Challinger had failed to
comply with a safety instruction. The Commissioner dealt with this issue at paragraphs [48] to
[53] of his decision and concluded as follows:
“[52]... I am not satisfied that Mr Challinger was instructed that he had to wear an armguard
when undertaking the particular work being performed by him on 12 February 2014, before
being told to do so on that day. Mr Challinger did then put on the armguard; albeit under
protest.”
[8] The Commissioner went on to make findings as to the language used by Mr Challinger
when instructed to wear an armguard (at [78]). The Commissioner characterised Mr
Challinger’s language and tone as ‘unwarranted, abusive and personal’ (at [78]) and
concluded that his conduct constituted a valid reason for dismissal (at [80]). The
Commissioner then considered the other criterion in s.387 and ultimately concluded that Mr
Challinger’s dismissal was harsh and therefore unfair within the meaning of s.385 of the FW
Act.
[9] The Commissioner dealt with the issue of remedy in the second Decision, which is the
subject of the application for permission to appeal.
[10] The appellant advances three points in support of its application for permission to
appeal:
(i) the Commissioner erred in failing to have regard to his earlier finding that there was a
valid reason for Mr Challinger’s dismissal in his consideration of whether
reinstatement was appropriate;
[2015] FWCFB 520
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(ii) the Commissioner’s consideration of Mr Schiller’s evidence did not accurately reflect
the whole of his evidence; and
(iii)there is a need for more specific guidance regarding the appropriateness of
reinstatement in circumstances where the Commission has found that there was a valid
reason for the employee’s dismissal.
[11] For the reasons which follow we are not persuaded that any of the matters advanced
by the appellant enliven the public interest.
[12] As to the first matter, we are not persuaded that the Commissioner failed to have
regard to his earlier finding that there was a valid reason for Mr Challinger’s dismissal. At
paragraph [3] of the second Decision the Commissioner expressly refers to the conclusions
reached in his first Decision including his finding that there was a valid reason for Mr
Challinger’s dismissal. Further, it is evident from paragraphs [46] and [47] of the second
Decision that the Commissioner had regard to this matter. These paragraphs are set out below
and the passages to which we refer are underlined.
“[46] There is little direct evidence touching from the other managers and supervisors who
would more directly need to supervise and manage Mr Challinger if he was reinstated. This
does not mean that their evidence and concerns about the conduct of Mr Challinger in the
events leading to the decision are irrelevant, or that some reasonable inferences cannot be
drawn from the actual conduct itself.
[47] However, the direct evidence going to the loss of trust and confidence was based upon an
incorrect understanding of Mr Challinger’s conduct in not wearing the armguard at the time. I
was not satisfied that he had already been instructed to wear the armguard in the
circumstances applying at the time and I noted that given his role as a delegate with an earlier
role in the trialling of the armguards, it was not inappropriate for him to raise the issue. He
also did put the armguard on when instructed to do so. It was the manner and language
associated with how he went about that which created the valid reason for dismissal, however
he did not deliberately ignore a safety direction.”
[13] As to the second point advanced by the appellant, Mr Schiller deals with the issue of
reinstatement at paragraphs 53-56 of his witness statement (see Appeal Book 433) as follows,:
“53. I am aware that Scott Challinger is seeking reinstatement as a remedy with respect to his
application for unfair dismissal.
54. I am not comfortable about Scott Challinger coming back to work at JBS for the reasons
discussed above.
55. I do not have confidence that Scott Challinger will follow directions from JBS particularly
in the important area of safety and that his actions in failing to comply with such directions
will create an inappropriate negative culture.
56. I do not consider that is it appropriate for Scott Challinger to come back to work for JBS
for these reasons.”
[14] There is no further elaboration of this aspect of Mr Schiller’s evidence during his
examination in chief and Mr Schiller’s attitude to Mr Challinger’s reinstatement was only
[2015] FWCFB 520
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briefly dealt with in cross examination and those passages are set out at paragraph [45] of the
second Decision. Further, footnote 12 in paragraph [45] of the second Decision (set out
above) is a reference to Mr Schiller’s statement, Exhibit R13.
[15] The Commissioner deals with the contention that there was a loss of trust and
confidence at paragraphs [45] - [47] of the second Decision. Paragraphs [46] and [47] are set
out above and paragraph [45] sets out the evidence to which the Commissioner referred.
“[45] The only substantive evidence directly touching upon trust and confidence in the present
context was that given by Mr Schiller, the employer’s Plant Manager whose evidence was that
he would not be comfortable with Mr Challinger being reinstated.9 The basis for this position
was explored under cross-examination as follows:
“PN2374
You say in your statement you're not comfortable with Mr Challinger being reinstated.
Is that right?---Correct.
PN2375
You say you don't have any confidence that Mr Challinger will follow directions from
JBS?---Correct.
PN2376
You formed that view on the basis of your understanding, firstly, that Mr Challinger
deliberately ignored a safety direction to wear his armguard?
---Mm'hm.
PN2378
And because of the view you formed, that Mr Challinger embarked upon a deliberate
course of conduct to undermine employee cooperation?---Yes.””
[16] Mr Schiller’s evidence was the only direct evidence going to the alleged loss of trust
and confidence. The Commissioner rejected this aspect of Mr Schiller’s evidence on the basis
that it ‘was based upon an incorrect understanding of Mr Challinger’s conduct in not wearing
the armguard at the time’.
[17] The appellant contends that the Commissioner did not consider the whole of Mr
Schiller’s evidence. The short point advanced by the appellant is that the Commissioner failed
to appreciate that Mr Schiller’s concerns were not solely based on the mistaken assumption
that Mr Challinger had ignored a safety instruction. It is submitted that Mr Schiller’s
apprehension about the reinstatement of Mr Challinger was also based on his use of
inappropriate language and his abusive behaviour, which the Commissioner had found
constituted a valid reason for his dismissal. This submission is based on paragraph 54 of Mr
Schiller’s statement where he says:
‘I am not comfortable about Scott Challinger coming back to work at JBS for the reasons
discussed above’. (emphasis added)
[18] It may be accepted that the reference to the ‘reasons discussed above’ included Mr
Challinger’s inappropriate language and abusive behaviour (see paragraphs 43-48 of Exhibit
R13, Appeal Book 432). However at its highest this evidence only establishes that Mr Schiller
was ‘not comfortable’ with Mr Challinger being reinstated given his use of inappropriate
language and his abusive behaviour. In our view this falls well short of establishing that there
had been a loss of trust and confidence such that it would not be feasible to re-establish the
[2015] FWCFB 520
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employment relationship. As was observed in Nguyen v Vietnamese Community in Australia
t/a Vietnamese Community Ethnic School South Australian Chapter (Nguyen),:
“An allegation that there has been a loss of trust and confidence must be soundly and
rationally based and it is important to carefully scrutinise a claim that reinstatement is
inappropriate because of a loss of confidence in the employee. The onus of establishing a loss
of trust and confidence rests on the party making the assertion.”
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[19] Even if it may be said that the Commissioner overlooked the import of paragraph 54
of Mr Schiller’s statement we are satisfied that this omission made no difference to his
conclusion given the qualified nature of this aspect of Mr Schiller’s evidence, that is he would
not ‘be comfortable’ if Mr Challinger were reinstated.
[20] In our view the evidence advanced by the appellant at first instance did not establish
that there had been a loss of trust and confidence in Mr Challinger such that reinstatement was
not appropriate. The Commissioner was plainly correct in reaching the conclusion he did
regarding this aspect of the appellant’s case.
[21] The final point advanced by the appellant is that there is a need for guidance by an
Appeal Bench regarding the appropriateness of reinstatement in circumstances where the
Commission has found that there was a valid reason for the employee’s dismissal. The
appellant submitted that as a matter of general principle reinstatement should not be ordered
in circumstances where there was a valid reason for dismissal relating to the employees
conduct and an absence of contrition (by the employee) about such conduct.
[22] We are not persuaded that there is a need for further guidance in relation to the
circumstances in which reinstatement may be found to be inappropriate and nor do we agree
with the general principle propounded by the appellant.
[23] The remedy of reinstatement and the circumstances in which it may be inappropriate
were extensively canvassed in a recent Full Bench decision (see Nguyen) and there is no
present need for any further elaboration on this issue.
[24] Remedies for unfair dismissals are dealt with in Division 4 of Part 3-2 of the FW Act
(ss.390-393). Section 390 is the relevant provision for present purposes, it states:
390 When the FWC may order remedy for unfair dismissal
(1) Subject to subsection (3), the FWC may order a person’s reinstatement, or the payment of
compensation to a person, if:
(a) the FWC is satisfied that the person was protected from unfair dismissal (see
Division 2) at the time of being dismissed; and
(b) the person has been unfairly dismissed (see Division 3).
(2) The FWC may make the order only if the person has made an application under
section 394.
(3) The FWC must not order the payment of compensation to the person unless:
(a) the FWC is satisfied that reinstatement of the person is inappropriate; and
[2015] FWCFB 520
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(b) the FWC considers an order for payment of compensation is appropriate in all the
circumstances of the case.
[25] The Commission has a discretion as to whether to order a person’s reinstatement. So
much is clear from the use of the word ‘may’ in s.390(1). The matters identified at s.390(1)(a)
and (b) and s.390(2) are preconditions to the exercise of the discretion. But once these
preconditions are met the discretion is expressed in very general terms. Of course the
discretion must be exercised judicially, but it is only constrained by the objects and purpose of
the FW Act.
[26] In our view the adoption of a decision rule or principle of the type proposed by the
appellant would be an inappropriate fetter on the exercise of what Parliament clearly intended
would be a general discretion. As Bowen LJ observed in Gardner v Jay,:11
“When a tribunal is invested by Act of Parliament or by Rules with a discretion, without any
indication in the Act or Rules of the grounds upon which the discretion is to be exercised, it is
a mistake to lay down any rules with a view to indicating the particular grooves in which the
discretion should run, for if the Act or the Rules do not fetter the discretion of the Judge why
should the court so do.”12
[27] The nature of the unfair dismissal jurisdiction is such that it is generally not
appropriate to attempt to express binding rules in relation to generalised factual scenarios.13
[28] As we have mentioned, s.400(1) provides that permission to appeal must not be
granted unless the Commission considers that it is in the public interest to do so. We do not
consider that it is in the public interest to grant permission to appeal and accordingly we
refuse permission to appeal.
PRESIDENT
Appearances:
The Appellant: Mr B. Duggan
The Respondent: Mr C. Buckley
Hearing details:
Sydney with video link to Adelaide and Brisbane
20 January 2015
Printed by authority of the Commonwealth Government Printer
Price code C, PR560275
1 [2014] FWC 4874
2 [2014] FWC 7963
[2015] FWCFB 520
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3 (2011) 192 FCR 78 at paragraph 43.
4 O’Sullivan v Farrer (1989) 168 CLR 210 per Mason CJ, Brennan, Dawson and Gaudron JJ; applied in Hogan v Hinch
(2011) 85 ALJR 398 at paragraph 69 per Gummow, Hayne, Heydon, Crennon, Kiefel and Bell JJ; Coal & Allied Mining
Services Pty Ltd v Lawler and others [2011] FCAFC 54 at paragraphs 44 - 46.
5 (2010) 197 IR 266 at paragraph 27.
6 Wan v AIRC [2001] FCA 1803 at [30]
7 GlaxoSmithKline Australia Pty Ltd v Makin [2010] FWAFB 5343 at [26]-[27]; Lawrence v Coal & Allied Mining Services
Pty Ltd t/as Mt Thorley Operations/Warkworth [2010] FWAFB 10089 at [28], affirmed on judicial review in Coal &
Allied Mining Services Pty Ltd v Lawler; [2011] FCAFC 54; NSW Bar Association v Brett McAuliffe; Commonwealth of
Australia represented by the Australian Taxation Office [2014] FWCFB 1663 at [28]
8 The reasons are set out in the letter of termination which is at Attachment TS7 to Mr Schiller’s statement, Appeal Book pp
455-457
9 [2014] FWC7963
10 [2014] FWCFB 7198 at [27]
11 (1885) 29 Ch. D. 50 at 58
12 Applied in Evans v Bartlam [1937] AC 473 at 488 per Lord Wright and cited with approval in Kostokanellis v Allen [1974]
VR 596 and Dix v Crimes Compensation Tribunal [1993] 1 VR 297. Also see JJ Richards and Sons Pty Ltd v FWA
[2012] FCAFC 53 (20 April 2012) at [30] per Jessup J (with whom Tracey J agreed) and at [63] per Flick J (with whom
Tracey J agreed).
13 See Jetstar Airways Pty Limited v Ms Monique Neeteson-Lemkes [2013] FWCFB 9075 at [59].
