1
Fair Work Act 2009
s.604 - Appeal of decisions
Parmalat Food Products Pty Ltd
v
Christopher Tran
(C2015/6098)
VICE PRESIDENT WATSON
DEPUTY PRESIDENT HAMILTON
COMMISSIONER JOHNS
MELBOURNE, 6 NOVEMBER 2015
Appeal against decision [[2015] FWC 5535] of Deputy President Lawrence at Sydney on 27
August 2015 in matter number U2015/4581 – Permission to appeal – Whether grounds of
appeal attract the public interest – Permission to appeal granted – Fair Work Act ss. 394,
400, 604.
Introduction
[1] On 27 August 2015 Deputy President Lawrence issued a decision1 and order2
regarding an application made by Christopher Tran under s.394 of the Fair Work Act 2009
(the Act). On 16 September 2015 Parmalat Food Products Pty Ltd (Parmalat) lodged an
appeal against the decision and order.
[2] Parmalat was directed to file and serve an outline of submissions addressing the issue
of why it is in the public interest to grant permission to appeal, and if the appeal is on a
question of fact, what is the significant error of fact involved in the decision. The matter was
listed for hearing on 27 October 2015.
[3] As the decision arises from an unfair dismissal application, s.400 applies to the appeal.
This section provides that:
“400 Appeal rights
(1) Despite subsection 604(2), the FWC must not grant permission to appeal from a
decision made by the FWC under this Part unless the FWC considers that it is in the
public interest to do so.
(2) Despite subsection 604(1), an appeal from a decision made by the FWC in relation
to a matter arising under this Part can only, to the extent that it is an appeal on a
question of fact, be made on the ground that the decision involved a significant error
of fact.”
[2015] FWCFB 7475
DECISION
E AUSTRALIA FairWork Commission
[2015] FWCFB 7475
2
[4] 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’.
[5] Factors that might invoke the public interest have been held to include where a matter
raises issues of importance and general application, where there is a diversity of decisions at
first instance so that guidance from an appellate court is required, where the decision at first
instance manifests an injustice, where the result is counterintuitive, or where the legal
principles applied appear disharmonious when compared with other recent decisions dealing
with similar matters.4
Permission to appeal
[6] In this case the Deputy President found that the applicant, Mr Tran, breached Parmalat
safety policy and practices on 5 March 2015, but determined that this was not a valid reason
for termination of his employment.5 In making that finding the Deputy President had regard to
a number of factors and concluded that:
“In all the circumstances, there were lesser punishments open to the Respondent which
would have been appropriate.”6
[7] In considering whether the Commission is satisfied that a dismissal is harsh, unjust or
unreasonable, the Commission must apply s.387 of the Act. That section has been in a similar
form in legislation governing unfair dismissal applications since 1996 and has been the
subject of repeated considerations by the Federal Court and Full Benches over that period. In
Chubb Security Australia Pty Ltd v John Thomas7 a Full Bench said of the equivalent
provision of the Workplace Relations Act:
“[35] The first matter we consider is Chubb's contention that his Honour erred in not
making a finding with respect to the relevant matter specified in s.170CG(3)(a); that is,
whether there was a valid reason for Mr Thomas's termination related to his conduct.
Section 170CG(3) required his Honour to have regard to the matters set out in
paragraphs (a) to (e) of it. We have set out in our paragraphs [6] to [10] what his
Honour said with respect to each of these matters. As appears from this, his Honour
did not make a finding as to whether there was a valid reason for Mr Thomas's
termination related to his conduct.
[36] Section 170CG(3) says that, in determining whether a termination was harsh,
unjust or unreasonable, "the Commission must have regard to" the matters specified in
paragraphs (a) to (e).
[37] The words "have regard to" were considered by the High Court in Re Hunt; Ex
parte Sean Investments Pty Ltd (1979) 53 ALJR 552. Mason J, with whom Gibbs J
agreed, said (of a section of an Act which said that the Permanent Head shall have
regard to certain costs) that when the section "directs the Permanent Head to 'have
regard to' the costs, it directs him to take those costs into account and to give weight
to them as a fundamental element in making his determination" (p.554). Murphy J said
that the section "tends in itself to show that his [the Permanent Head's] duty in respect
[2015] FWCFB 7475
3
of those costs is limited to having regard to them. He must take them into account and
consider them and give due weight to them, but he has an ultimate discretion" (p.556).
[38] Each of paragraphs (a) to (d) of s.170CG(3) requires the Commission to have
regard to "whether" a circumstance existed. Whether it existed must then (Re Hunt; Ex
parte Sean Investments Pty Ltd) be taken into account, considered and given due
weight as a fundamental element in determining whether the termination is harsh,
unjust or unreasonable.
[39] In this situation, and subject to the qualifications we express in the next
paragraph, the Commission, in our view, is not able to have regard to the
circumstances specified in ss.170CG(3)(a) to (d) without making a finding with
respect to each of them.
[40] We qualify what we have said in the previous paragraph in two respects:
(1) The circumstance in s.170CG(3)(a) contains three considerations:
·the capacity of the employee, or
·the conduct of the employee, or
·the operational requirements of the employer's undertaking,
establishment or service.
The need to make a finding under s.170CG(3)(a) will only be in respect
of such of these three considerations as is relevant. (In the present case,
for instance, the relevant consideration is whether there was a valid
reason for the termination of Mr Thomas related to his conduct.)
(2) The circumstance in s.170CG(3)(d) is only relevant "if the termination
related to unsatisfactory performance of the employee" (opening words of
s.170CG(3)(d)).
[41] Further, it is not, we think, possible to have regard to s.170CG(3)(b) until a
finding has been made with regard to s.170CG(3)(a). Section 170CG(3)(b) refers to
"that reason"; that is "a valid reason", being the term used in s.170CG(3)(a). If there
is no valid reason, s.170CG(3)(b) has no application. Neither, we think, has
s.170CG(3)(c).
[42] We are therefore of the opinion that his Honour's failure to make a finding with
respect to the relevant matter specified in s.170CG(3)(a) amounted to a failure,
contrary to s.170CG(3), to take that matter into account and, accordingly, an error of
the type referred to in s.170JF(2). This view is, we think, supported by Moore J's
remarks, quoted in our paragraph [33], in Edwards v Giudice that a failure to comply
with s.170CG(3)(a) amounts to an error of this type.”8
[8] In Potter v WorkCover Corporation9 a Full Bench said:
“In circumstances of summary dismissal the issue of whether the penalty imposed was
proportionate to the conduct is a matter more appropriately considered in the context of
s 170CG(3)(e) rather than s 170CG(3)(a). If summary dismissal was disproportionate
[2015] FWCFB 7475
4
to the misconduct that would support a conclusion that the termination was harsh,
despite the existence of a “valid reason” for termination.”
[9] In Edwards v Giudice10, Moore J of the Federal Court said:
“6. Paragraph (a) speaks of “whether there was a valid reason ... related to the ...
conduct of the employee”. The paragraph requires consideration of the validity of the
reason when the reason is, relevantly, based on conduct of the employee. It is, in my
opinion, difficult to avoid the conclusion that the Commission is obliged in such
circumstances to investigate in the inquiry process contemplated by s 170CG(3)
whether the conduct relied on occurred as a necessary step in the process of
determining whether a valid reason existed.
7. The reason would be valid because the conduct occurred and justified termination.
The reason might not be valid because the conduct did not occur or it did occur but did
not justify termination. An employee may concede in an arbitration that the conduct
took place because, for example, it involved a trivial misdemeanour. In those
circumstances the employee might elect to contest the termination in the arbitration on
the basis that the conduct took place but the conduct did not provide a valid reason and
perhaps also by relying on the other grounds in paras (b) to (e). However an employee
may not concede or admit, for the purposes of the arbitration, that the conduct
occurred or may not be prepared to accept that the Commission could assume the
conduct occurred. In either situation the employee would be putting in issue whether
the conduct occurred. In my opinion the Commission must, in these circumstances,
determine whether the conduct occurred as a step in resolving whether there was a
valid reason. I do not see how the Commission can move straight to a consideration of
whether termination was justified by assuming the conduct did occur. First the
Commission would have failed to resolve an issue raised by and relied on by the
employee, namely whether the conduct occurred at all. Second the Commission would
have failed to make findings by reference to which a Full Bench might have to
determine an appeal where the Commission had concluded the termination was harsh
unjust or unreasonable on assumed facts and not facts found.”
[10] It is arguable from these authorities that in conflating the test for valid reason with
issues of proportionality the Deputy President’s decision is affected by appealable error.
Further, it is arguable in expressing his conclusion as to an alternative form of disciplinary
action the Deputy President failed to apply the words of the statute. As the decision under
appeal raises issues of general application, including whether or not it is appropriate for the
Commission to find that a valid reason does not exist for the reasons set out in the decision,
we consider that it is in the public interest that we grant permission to appeal.
Conclusion
[11] We grant permission to appeal. We will issue directions for further submissions on
whether or not the appeal should be allowed and if so what orders should be made by the
Bench pursuant to s.607 of the Act.
[2015] FWCFB 7475
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VICE PRESIDENT
Appearances:
Mr I. Latham of counsel for Parmalat.
Mr T. Warnes for Mr Tran.
Hearing details:
2015.
Sydney
27 October.
Final written submissions:
Parmalat on 12 October 2015.
Mr Tran on 23 October 2015.
Printed by authority of the Commonwealth Government Printer
Price code C, PR573444
1 [2015] FWC 5535.
2 PR571310.
3 (2011) 192 FCR 78 at paragraph 43.
4 GlaxoSmithKline Australia Pty Ltd v Makin [2010] FWAFB 5343.
5 Paragraphs 54 and 57.
6 Paragraph 57
7 Print S2679.
8 See also King v Freshmore (Vic) Pty Ltd (unreported, AIRCFB, Ross VP, Williams SDP, Hingley C, 17 March 2000) Print
S4213 [19]; Tenix Defence Systems Pty Ltd v Fearnley (unreported, AIRCFB, Ross VP, Polites SDP, Smith C, 22 May
2000) Print S6238 [71]; Annetta v Ansett Australia Ltd (2000) 98 IR 233 [15].
9 (2004) 133 IR 458 at [55].
10 [1999] FCA 1836.
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