1
Fair Work Act 2009
s.604—Appeal of decision
Hanson Construction Materials Pty Ltd
v
Darren Pericich
(C2018/4449)
DEPUTY PRESIDENT MASSON MELBOURNE, 17 AUGUST 2018
Appeal against decision [2018] FWC 4369 of Commissioner Spencer at Brisbane on 9 August
2018 in matter number U2017/12758.
[1] This decision concerns an application for a stay order by Hanson Construction
Materials Pty Ltd (the Appellant). The stay order is sought pursuant to s 606 of the Fair Work
Act 2009 (the Act) in relation to an appeal lodged against a decision issued by Commissioner
Spencer on 9 August 2018 (the Decision).1 In the Decision, the Commissioner determined,
having previously found and determined in a decision issued on 25 May 20182 that Mr Darren
Pericich (Mr Pericich; the Respondent) had been unfairly dismissed, to award compensation
in the amount of $10,951.87, less applicable taxation, to be paid within 14 days.
[2] Section 606(1) of the Act provides as follows:
Staying decisions that are appealed or reviewed
(1) If, under section 604 or 605, the FWC hears an appeal from, or conducts a
review of, a decision, the FWC may (except as provided by subsection (3))
order that the operation of the whole or part of the decision be stayed, on
any terms and conditions that the FWC considers appropriate, until a
decision in relation to the appeal or review is made or the FWC makes a
further order.
[3] The Appellant seeks a stay of the whole of the order of Commissioner Spencer. The
practical effect of a stay would be to suspend the obligation to pay the compensation until the
appeal in this matter is determined.
Principles for staying the operation of a decision or order
[4] It is well established that, in deciding whether to exercise its discretion to grant a stay
order, the Commission must first be satisfied that the appellant has an arguable case with
some reasonable prospects of success, both in respect of permission to appeal and the
substantive merits of the appeal.3 In addition, the balance of convenience must weigh in
favour of the order subject to appeal being stayed.4
[2018] FWC 4827[Note: a correction has been issued to this document]
DECISION
E AUSTRALIA FairWork Commission
https://www.fwc.gov.au/documents/decisionssigned/html/2018fwc4827_pr620024.htm
[2018] FWC 4827
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[5] These principles should be applied against the statutory framework that applies to
appeals against decisions relating to unfair dismissal. Unlike appeals against decisions made
under other provisions of the Act, permission to appeal a decision under Part 3-2 will only be
granted if the Commission considers it to be in the public interest to do so.5 There is
accordingly a higher threshold for permission to appeal.6
[6] Further, to the extent that the appeal is on a question of fact, the appeal can only be
made on the ground that the decision involved a significant error of fact.7
[7] More generally, other errors said to have been made by the first instance decision-
maker must be of a kind identified by the High Court in House v King.8
Background
[8] Mr Pericich was employed by the Appellant as a professional tipper driver. He
commenced his employment on or about 10 April 2013 and was dismissed on 13 November
2017.
[9] Mr Pericich was dismissed by the Appellant for “unsafe driving” as a result of an
incident on 9 November 2017 in which, while driving a truck with an attached trailer, he had a
serious near miss when he failed to stop at red lights on a railway crossing on Cape Cleveland
Road with a passenger train approaching.
[10] The unfair dismissal proceedings before the Commission were conducted at a hearing
on 7 March 2018. Permission to appear was granted by the Commissioner pursuant to s 596
of the Act for legal representatives to appear for both the Appellant and Mr Pericich.
[11] The Commissioner heard sworn evidence from several witnesses including Mr
Pericich and the Appellant’s Logistics Manager, Mr Shane Blank. The Commissioner also
had access to dash cam footage of the incident as part of the evidentiary material before her.
In her initial decision of 25 May 2018,9 the Commissioner concluded that a valid reason for
Mr Pericich’s dismissal had been established and that “the conduct of the Applicant involved
taking an unnecessary risk that could have resulted in a serious accident”.10 The
Commissioner further found that while a valid reason existed, Mr Pericich had not been
accorded procedural fairness in the process of dismissal.
[12] The Commissioner concluded that Mr Pericich was not afforded procedural fairness;
the allegations were not clearly put to him; and he was not given an opportunity to respond
with a witness present prior to being stood down and then prior to termination. The
Commissioner determined that reinstatement was not appropriate and then proceeded to
address the question of compensation. In her decision of 25 May 2018, she directed the parties
to make further submissions in relation to the issue of compensation, specifically in relation to
the estimation of how much longer Mr Pericich would have remained in the Appellant’s
employment but for the termination.
[13] In the subsequent Decision issued on 9 August 2018, the Commissioner determined to
award compensation of $10,951.87, less applicable taxation, to be paid to Mr Pericich within
14 days.
[2018] FWC 4827
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The grounds of appeal
[14] The Appellant raises two grounds of appeal, contending that the Commissioner’s
decision was affected by an error of law and a significant error of fact.
[15] By its first ground of appeal, the Appellant contends that the Commissioner erred in
her application of s 392(2)(c) of the Act, contrary to prior authority, by not determining the
period of time Mr Pericich would have remained employed by the Appellant had the
Appellant afforded him procedural fairness.
[16] By its second ground of appeal, the Appellant contends that the Commissioner made a
significant error of fact in her assessment under s 392(2)(c) of the Act, in finding that Mr
Pericich’s employment would have continued for six months.
[17] The grounds of appeal are not matters that are to be determined in this stay
application. Rather, the question to be determined is whether the order made by
Commissioner Spencer on 9 August 2018 should be stayed. The purpose of examining the
grounds of appeal is to consider whether they disclose an arguable case of error, with some
reasonable prospect of success on appeal.
Arguable case with some reasonable prospect of success
[18] The Appellant contends that in considering s 392(2)(c) of the Act, the Commissioner
failed to follow relevant legal authority in reaching her conclusion that Mr Pericich would
have continued his employment for six months in circumstances where she had found a valid
reason existed for his dismissal.
[19] The Appellant contends that in the circumstances of the present matter, the proper
approach that ought to have been followed by the Commissioner was that of considering how
much longer Mr Pericich would have remained employed had the Appellant afforded him
procedural fairness. The conclusion of six months that was reached by the Commissioner in
answering s 392(2)(c) of the Act and the ultimate compensation amount determined was
based in part on an erroneous application of the law in the Appellant’s submission.
[20] The Commissioner described the competing submissions of the Appellant and Mr
Pericich regarding the estimated length of employment at paragraphs [25] and [26] in the
Decision where she states as follows:
“[25] In accordance with the decision in The Pet Cemetery, the parties were directed
to address the estimated length of the continuation of the employment contract, but for
the dismissal. For the purposes of s.392(2)(c), the submission of the Applicant was
that he intended to remain employed for some time. There was no evidence that he had
any intention of leaving the Respondent’s business, prior to his dismissal. The
Respondent only relied on the incident in contention for the dismissal.
[26] The Respondent considered the Applicant’s employment would only have
continued for a further week, to allow for a procedurally fair process to occur. The
Respondent noted the risk taken by the Applicant as a driver, and considered the
employment relationship would not continue for long.
[2018] FWC 4827
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[21] The Commissioner went on to conclude at paragraph [33] as follows:
“[33] The reasons in relation to the dismissal, based on the evidence, have been set
out in the substantive decision. In the assessment of the continuation of the
employment contract (as required in the consideration of compensation), it is
considered that based on the Applicant’s prior employment and the procedural
fairness issues, the particular circumstances of the Applicant’s driving as set out in
relation to the incident, that the Applicant’s employment would have continued for six
months.”
[22] It is relevant to observe that determination of the remuneration that a dismissed
employee would have earned pursuant to s 392(2)(c) of the Act but for their dismissal is an
inherently imprecise process. It requires a degree of speculation and consideration of a range
of factors. In circumstances where the Commission has found that a valid reason for the
dismissal was established but procedural flaws rendered the dismissal unfair, it is not the case
that the only consideration in respect of s 392(2)(c) of the Act is how much longer would a
procedurally fair process have taken. Were that the case, there would be little utility to
requiring procedural fairness, as the assumption would be that no difference in outcome
would have arisen had procedural fairness been accorded.
[23] The according of procedural fairness ensures an employee has an opportunity to
respond and advance reasons why they believe allegations are unfounded and/or to provide
matters for their employer to consider by way of mitigation. The provision of that opportunity
may result in a different outcome for an employee under threat of dismissal to that which may
have occurred but for the opportunity to respond having been provided. That is why the
absence of an opportunity to respond in the context of considering s 392(2)(c) of the Act
requires such a degree of speculation. It must be said, however, that consideration of what
impact the procedural fairness steps would have yielded if provided, is likely to be more
straightforward in circumstances such as where clear breaches of critical safety requirements
have been established.
[24] In the present matter, the Commissioner was satisfied that Mr Pericich had engaged in
conduct that posed a risk to the safety of himself and others by driving through a rail crossing
at which the red lights were flashing and a passenger train was approaching. It is hard to
envisage a more serious breach of safety rules by a heavy vehicle driver. The Commissioner
in the circumstances also concluded that reinstatement was not appropriate. There is a
significant tension between those findings and the Commissioner’s conclusion that Mr
Pericich would have remained employed for a further six months.
[25] While the Commissioner’s decision makes reference to her consideration of a number
of factors in arriving at the six month estimate for Mr Pericich’s continued employment, it
does not adequately disclose her reasoning. Further, the Commissioner’s approach to
considering s 392(2)(c) of the Act and her conclusion appears dissonant with recent
authority.11
[26] In my view there is an arguable case, with some prospects of success that the
Commissioner has fallen into error and that the facts and reasoning upon which the
Commissioner relied was an insufficient base on which to conclude that Mr Pericich would
have remained employed for a period of six months.
[2018] FWC 4827
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Balance of convenience
[27] As to the balance of convenience, the Appellant confirmed that, if a stay were granted,
it would be prepared to deposit the amount due to the Respondent into a trust account of the
amount that would have been payable to Mr Pericich, pursuant to the Commissioner’s order,
pending determination of the appeal. This weighs in favour of the Appellant in consideration
of the balance of convenience.
[28] I also note that the preservation of the status quo and the prejudice the Appellant may
suffer if required to pay the compensation in advance of the appeal hearing also favoured the
Appellant in consideration of the balance of convenience.
Conclusion
[29] Taking all of these matters into account, I am satisfied that I should make an order
staying the operation of the order of Commissioner Spencer in PR609283, pending the
determination of the appeal.
[30] I will also order that the Appellant pays into the trust account of the Appellant’s legal
representative amounts that would otherwise have been payable to Mr Pericich as
contemplated by the Commissioner’s order. These sums shall be paid to Mr Pericich in the
event that the appeal is unsuccessful.
[31] The application for a stay is granted. An order giving effect to my decision is issued
separately in PR610009.
DEPUTY PRESIDENT
OF THE FAIR WORK USTRALIA ISSION THE SEAL
[2018] FWC 4827
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Appearances:
P Copeland for the Appellant.
K Fredericks for the Respondent.
Hearing details:
2018.
Melbourne
August 16
Printed by authority of the Commonwealth Government Printer
PR610010
1
Mr Darren Pericich v Hanson Construction Materials Pty Ltd T/A Hanson Construction Materials Pty Ltd [2018] FWC
4369.
2 Mr Darren Pericich v Hanson Construction Materials Pty Ltd T/A Hanson Construction Materials Pty Ltd [2018] FWC
1336.
3 Kellow-Falkiner Motors Pty Ltd v Edghill Print S2639, 24 January 2000 at [5]; applied in Bank of Sydney Ltd v Repici
[2015] FWC 5511 et al.
4 Ibid. See also Coal and Allied Operations Pty Limited v Crawford and Others (2001) 109 IR 409 at [13].
5 Section 400(1) of the Act.
6 WorkPac Pty Ltd v Bambach (2012) 220 IR 313; FWAFB 3206 at 14.
7 Section 400(2) of the Act.
8 House v R (1936) 55 CLR 499.
9 [2018] FWC 1336.
10 Ibid, Paragraph [71].
11 See Mr. Nigel Smith V Buick Holding Pty Ltd T/A DVG Automotive Group – Midland City [2016] FWCFB 3683 at [6];
Phillip Parker v Garry Crick’s (Nambour) Pty Ltd as The Trustee for Crick Unit Trust T/A Crick’s Volkswagen [2018]
FWCFB 279 at [20].
