[2019] FWC 2569

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Kevin Emery
v
City of Stirling
(U2017/2986)

COMMISSIONER BISSETT

MELBOURNE, 29 APRIL 2019

Application for an unfair dismissal remedy – reinstatement not appropriate – compensation ordered.

[1] On 3 December 2018 I issued a decision 1 (2018 Decision) in which I found that Mr Kevin Emery had been unfairly dismissed from his employment with the City of Stirling (the City). In the 2018 Decision I indicated that the matter of remedy would be dealt with at a later date. Directions were issued for the filing of submissions and evidence with respect to remedy and the matter heard on 25 March 2019.

[2] Mr Emery seeks reinstatement to his role with the City as a Beach Inspector. The City opposes such remedy.

The 2018 Decision

[3] In the 2018 Decision I found that:

• Mr Emery had made modifications to two Beach Inspector vehicles (BIVs); 2

• The modifications were not approved by Mr Emery’s supervisor Mr Snook or anyone else 3 and that Mr Snook was not aware of the modifications;4

• The modification to BIV U481 caused damage to that vehicle and may have endangered others; 5

• The modifications made to the BIVs had the potential to affect the ability of the City to perform life-saving services; 6

• Mr Emery’s conduct was in breach of the City’s Code of Conduct and Fleet Management Practice; 7

• I could not be satisfied that a sound and proper investigation was undertaken by the City into the allegations; 8

• The disciplinary meeting denied Mr Emery a fair opportunity to put his case as he was not advised of the findings that formed the basis of his dismissal; 9 and

• Mr Snook was in a conflicted position and his continued involvement in the investigation denied Mr Emery procedural fairness; 10

• Mr Snook’s evidence was to be preferred to that of Mr Emery. 11

[4] Taking all of my findings into account I found that:

• There was a valid reason for the dismissal of Mr Emery related to his conduct; 12

• Mr Emery was not notified of the totality of the reasons for his dismissal nor given an opportunity to respond; 13

• Whilst showing remorse Mr Emery did not acknowledge the error of what he did. 14

[5] In conclusion I determined that the dismissal of Mr Emery was unreasonable and that he had, therefore, been unfairly dismissed. In reaching this conclusion I said:

[262] I have reached this conclusion because of the substantial deficiencies in the investigation process carried out by the City into the allegations and the failure of Mr Snook to step aside from the investigation once it became clear Mr Emery claimed he had approved the modifications to the BIVs. I am not satisfied that the procedure adopted by the City in investigating the conduct was sound, rigorous and without fault. Further, I am satisfied that these deficiencies had a substantive effect on the capacity of Mr Emery to respond to the reasons for his dismissal such that he might have some influence on the decision

[263] While it is true that procedural defects will not necessarily render a dismissal unfair, in this case I am satisfied that the lack of an appropriate investigation and the involvement of Mr Snook in the investigation means little confidence can be had in the investigation process (as it was). This casts substantial doubt over the outcome of that process.

[264] In such circumstances and where I have a real concern at the extent of the investigation undertaken and the apparent conflict of interest in Mr Snook’s involvement, I am not convinced that the outcome would not have been different had a thorough and proper investigation been undertaken, had Mr Emery been provided with the detail relevant to the consideration of the City, and if Mr Snook had stepped down and was replaced by another manager as investigator.

Remedy

[6] The remedy provisions are set out in ss.390-392 of the Fair Work Act 2009 (FW Act). The remedies provide for reinstatement (s.391) or compensation in circumstances where reinstatement is not appropriate (s.392).

[7] In Regional Express Holdings Ltd v Richards 15 the Full Bench of Fair Work Australia found:

[23] It is clear from the terms of s.390(3)(a) that, in circumstances where a remedy is appropriate, compensation must not be ordered unless the tribunal is satisfied that reinstatement is inappropriate. Seen in the proper context the Commissioner’s statement that reinstatement is the presumptive remedy is not indicative of any error in the decision. The section provides that compensation must not be ordered unless reinstatement has been found to be inappropriate. There is no basis for concluding that the Commissioner interpreted the section differently. Rex’s first submission on remedy must fail.

[24] In relation to remedy, therefore, the first question is whether reinstatement is appropriate…

[8] In Nguyen & Le v Vietnamese Community in Australia T/A Vietnamese Community Ethnic School South Australia Chapter 16 (Nguyen) a Full Bench of the Fair Work Commission (Commission) said:

[10] Subsection 390(3) underscores the primacy of reinstatement as a remedy for an unfair dismissal as the discretion to order a remedy of compensation may only be exercised if the Commission is satisfied that reinstatement is ‘inappropriate’. Further, one of the objects of Part 3-2 of Chapter 3, in which the unfair dismissal provisions appear, is “to provide remedies if a dismissal is found to be unfair, with an emphasis on reinstatement”. We would observe that to describe reinstatement as the ‘primary remedy’, is to simply recognise that reinstatement is the first, perhaps even the foremost, remedy under the Act. The relevant question in determining whether to grant the remedy of reinstatement of an employee in relation to a dismissal that is found to have been ‘unfair’ is whether reinstatement is appropriate in the particular case. [Endnotes omitted]

[9] I am therefore satisfied that reinstatement is the first matter to be considered in determining remedy. The corollary to a determination under s.392 of the FW Act that compensation be considered only if remedy is inappropriate is that the appropriateness of reinstatement must be considered in the first instance.

[10] The Full Bench in Nguyen detailed those matters relevant to a determination of the appropriateness of reinstatement. The Full Bench found that:

[17] Reinstatement might be inappropriate in a whole range of circumstances, for example if such an order would be futile such as where reinstatement of an employee would almost certainly lead to a further termination of the employee’s employment because the employer has since discovered that the employee engaged in an act of serious misconduct which was only discovered after the employee’s termination or if the employer no longer conducts a business into which the employee may be reappointed. The fact that the employer has filled the position previously occupied by the dismissed employee would rarely, of itself, justify a conclusion that reinstatement was not appropriate […]

[19] Reinstatement may be inappropriate if an employee is incapacitated because of illness or injury. The weight to be accorded to ongoing incapacity when considering whether reinstatement is appropriate will depend upon all of the circumstances of the case.

[20] The most common argument advanced in support of the proposition that reinstatement is inappropriate is the proposition, variously expressed, that there has been a loss of trust and confidence such that it would not be feasible to re-establish the employment relationship.

[21] In Perkins v Grace Worldwide (Aust) Pty Ltd the Full Court of the Industrial Relations Court considered the effect of a loss of trust and confidence on the question of the “practicability” of a reinstatement remedy and said:

“Trust and confidence is a necessary ingredient in any employment relationship... So we accept that the question whether there has been a loss of trust and confidence is a relevant consideration in determining whether reinstatement is impracticable, provided that such loss of trust and confidence is soundly and rationally based.

At the same time, it must be recognised that, where an employer, or a senior officer of an employer, accuses an employee of wrongdoing justifying the summary termination of the employee’s employment, the accuser will often be reluctant to shift from the view that such wrongdoing has occurred, irrespective of the Court’s finding on that question in the resolution of an application under Division 3 of Part VIA of the Act.

If the Court were to adopt a general attitude that such a reluctance destroyed the relationship of trust and confidence between employer and employee, and so made reinstatement impracticable, an employee who was terminated after an accusation of wrongdoing but later succeeded in an application under the Division would be denied access to the primary remedy provided by the legislation. Compensation, which is subject to a statutory limit, would be the only available remedy. Consequently, it is important that the Court carefully scrutinise any claim by an employer that reinstatement is impracticable because of a loss of confidence in the employee.

Each case must be decided on its own merits. There may be cases where any ripple on the surface of the employment relationship will destroy its viability. For example the life of the employer, or some other person or persons, might depend on the reliability of the terminated employee, and the employer has a reasonable doubt about that reliability. There may be a case where there is a question about the discretion of an employee who is required to handle highly confidential information. But those are relatively uncommon situations. In most cases, the employment relationship is capable of withstanding some friction and doubts. Trust and confidence are concepts of degree. It is rare for any human being to have total trust in another. What is important in the employment relationship is that there be sufficient trust to make the relationship viable and productive. Whether that standard is reached in any particular case must depend upon the circumstances of the particular case. And in assessing that question, it is appropriate to consider the rationality of any attitude taken by a party.

It may be difficult or embarrassing for an employer to be required to re-employ a person the employer believed to have been guilty of wrongdoing. The requirement may cause inconvenience to the employer. But if there is such a requirement, it will be because the employee’s employment was earlier terminated without a valid reason or without extending procedural fairness to the employee. The problems will be of the employer’s own making. If the employer is of even average fair-mindedness, they are likely to prove short-lived. Problems such as this do not necessarily indicate such a loss of confidence as to make the restoration of the employment relationship impracticable.”

[22] As the Full Bench of the AIRC observed in McLauchlan, although Perkins was decided under the IR Act, the Court’s observations reproduced above remain relevant to the question of whether reinstatement is appropriate in a particular case.

[23] In speaking of ‘trust and confidence’ in this context we are concerned with that which is essential to make an employment relationship workable. It is not to be confused with an implied term in a contract of employment of mutual trust and confidence, the existence of which was recently eschewed by the High Court in Commonwealth Bank of Australia v Barker.

[24] While it may be accepted that trust and confidence is a necessary ingredient in any employment relationship, it would be wrong to assume that it is the sole criterion or even a necessary one to determine whether or not reinstatement is appropriate...

[11] The Full Bench considered the decision of Deputy President Gostencnik in Colson v Barwon Health 17 and found that:

[27] The following propositions concerning the impact of a loss of trust and confidence on the question of whether reinstatement is appropriate may be distilled from the decided cases:

• Whether there has been a loss of trust and confidence is a relevant consideration in determining whether reinstatement is appropriate but while it will often be an important consideration it is not the sole criterion or even a necessary one in determining whether or not to order reinstatement.

• Each case must be decided on its own facts, including the nature of the employment concerned. There may be a limited number of circumstances in which any ripple on the surface of the employment relationship will destroy its viability but in most cases the employment relationship is capable of withstanding some friction and doubts.

• 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.

• The reluctance of an employer to shift from a view, despite a tribunal’s assessment that the employee was not guilty of serious wrongdoing or misconduct, does not provide a sound basis to conclude that the relationship of trust and confidence is irreparably damaged or destroyed.

• The fact that it may be difficult or embarrassing for an employer to be required to re-employ an employee whom the employer believed to have been guilty of serious wrongdoing or misconduct are not necessarily indicative of a loss of trust and confidence so as to make restoring the employment relationship inappropriate. [Endnotes omitted]

Evidence

[12] Mr Snook is the Team Leader of the Beach Services Team and the Beach Inspectors report to him. Mr Emery had reported to him prior to his dismissal and if he was reinstated as a Beach Inspector would again report to him. Mr Snook said he has four Beach Inspectors who report to him – Mr Andreas Kolm, Mr Adam Gugiatti, Mr Johnny Hardbattle and Mr Jesse Willison. He said that Mr Kolm and Mr Gugiatti gave evidence for the City in the initial proceedings. Mr Hardbattle gave evidence for Mr Emery in those proceedings.

[13] Mr Willison was employed on or about 19 June 2017 in an ongoing role following the dismissal of Mr Emery. Mr Snook was involved in that selection process. Mr Snook said Mr Willison is a good performer and team member. Mr Snook also said that Mr Willison’s father is his landlord.

[14] Mr Snook gave evidence that, as a small team, everyone needs to work together. The involvement of Mr Kolm, Mr Gugiatti and Mr Hardbattle in proceedings in the Commission in relation to Mr Emery’s dismissal has diminished the willingness of the three team members to interact. Mr Snook’s assessment is that this is attributable to team members giving evidence for the opposing sides and a concern as to how Mr Emery might treat those who gave evidence against him if he is reinstated.

[15] Mr Snook said that The Conflict Company (TCC) was engaged by the City in September 2018. Mr Snook told Mr Halford of TCC that he was concerned at the impact of the case on staff morale, that there was some division in the team and the conflict needed to be rectified as it was a small team and they needed to work together effectively.

[16] Mr Snook said that his involvement in the case had caused him significant stress. He had not sought medical attention for that stress but said that the assistance and mediation through TCC has been a means of coping with the stress.

[17] A mediation session between the Beach Inspectors Team and Mr Halford of TCC was held in January 2019. It went for about five hours. Mr Snook said that during the session Mr Hardbattle brought up the Emery case, at one point indicating that he did not really want Mr Emery back.

[18] Mr Snook gave evidence that he has lost trust and confidence in Mr Emery because:

• During the proceedings in the Commission to date Mr Emery has made assertions against Mr Snook which were not accepted by the Commission;

• Mr Emery has persisted with these assertions, causing Mr Snook stress and embarrassment both before the City and in the Commission;

• Having to vindicate himself meant he no longer feels he could trust Mr Emery to carry out his instructions without Mr Emery making things up against him.

[19] Mr Snook agreed that, prior to the conduct that led to the dismissal of Mr Emery, there were no performance concerns, Mr Emery was considered a good employee who followed instructions and did not invent stories of others. Mr Emery had not, prior to the dismissal, shown disrespect for authority.

[20] Mr Snook agreed that his concern that Mr Emery may hold some grudge against him or other employees was speculation on his part but said that Mr Emery has not acknowledged that he did the wrong thing in modifying the BIVs.

[21] Mr Snook agreed that if Mr Emery was reinstated and engaged in misconduct the City has procedures for dealing with such matters.

[22] Mr Gugiatti is a Beach Inspector. He gave evidence that he has felt increased levels of stress as a result of giving evidence, he has suffered anxiety at the possibility of Mr Emery being reinstated and has low morale impacting his enthusiasm for working in the team.

[23] Mr Gugiatti said he has heard Mr Hardbattle make comments to casual lifeguards to the effect that “Snook is lying” and that the City’s management of Mr Emery’s termination was “tainted”.

[24] Mr Gugiatti met with Mr Halford of TCC individually first in September 2018 where he discussed the impact of the case on himself and the Beach Inspectors Team. Mr Gugiatti also attended the group mediation session in January 2019. He has also had follow up individual meetings with Mr Halford.

[25] Whilst Mr Gugiatti agreed that the mediation through TCC and individual meetings he has had with Mr Halford have been of assistance in improving the conflict within the Beach Inspectors Team, he is concerned that if Mr Emery was reinstated the conflict would be too great to allow TCC the ability to help.

[26] Mr Gugiatti said that following Mr Emery’s claims that Mr Snook had authorised the modifications to the BIVs he had no confidence that he could trust Mr Emery to work with him or for Mr Emery to obey directions given to him by Mr Snook. He said he did not wish to work with Mr Emery when he has been disingenuous about his dealing with Mr Snook. He says he is fearful that Mr Emery may be untruthful about their interactions. Mr Gugiatti expressed concern that Mr Emery does not respect Mr Snook as a Team Leader and that this may adversely affect the need for open and clear communications within the team.

[27] Mr Cheyne Cameron is the Manager, Recreation and Leisure Services at the City. Ms Pastor reports to him and Mr Snook reports to Ms Pastor.

[28] Mr Cameron commenced employment with the City after the time of Mr Emery’s dismissal. He says he is aware of the case and has read the Appeal Books (court books) and transcript of proceedings. Mr Cameron became aware through his interaction with the Beach Services Team that the unfair dismissal case was having an adverse effect on the team. As a result of this and his observations of the team Mr Cameron decided to engage TCC to work with the Beach Inspectors Team to understand the issues within the team and to assist the team in resolving any conflict. Mr Cameron chose TCC as he had worked with them in a previous role.

[29] Mr Cameron gave evidence that TCC and Mr Halford have assisted and are making progress with the Beach Inspectors Team. He agreed that TCC continues to be engaged by the City.

[30] Mr Cameron said he is ultimately responsible for the functioning of the Beach Inspectors Team. He said that he does not wish to have Mr Emery return to the team as he has no trust and confidence in Mr Emery because of the context of his conduct (being the life-saving capacity of the team); the nature of the misconduct in breaching policies of the City; the way Mr Emery asserted and maintained his position, even under oath, that Mr Snook had authorised him to make the modifications; Mr Emery’s unwillingness to take responsibility for his actions; the assertions of authorisation made by Mr Emery against his supervisor calling into question Mr Snook’s integrity; Mr Emery’s willingness to put another employee “in the firing line”; and Mr Emery’s failure to show remorse, failure to appreciate the gravity of his actions, lack of insight and inability to accept when he is wrong (his refusal to accept that the wiring diagram was not produced in the first hearing of his application being indicative of this). Mr Cameron formed his views based on his reading of the transcript and court books from the hearings (and appeal).

[31] Mr Cameron says that he has no confidence in Mr Snook and Mr Emery being able to work together in the future. He is concerned that reinstatement of Mr Emery will disturb the efforts of the City to overcome problems in the team through mediation.

[32] Mr Emery gave evidence that he has previously received recognition of his work by Mr Snook, received a five year service recognition medal from the City and had previously been an employee representative on the bargaining committee for the 2015 Enterprise Agreement.

[33] Mr Emery gave evidence that he could work with Mr Snook if reinstated. He said he has met Mr Snook on a number of occasions where he has worked at beach events as a volunteer and their interactions have been cordial, polite and professional.

Submissions

[34] Mr Emery submits that any claim to loss of trust and confidence, whilst a relevant consideration, is not the sole basis for determining if he should be reinstated. Each case turns on its own facts but in most cases the employment relationship can be re-established. Further, a reluctance of the employer to shift from a preconceived view is not a sound reason to find that trust and confidence has been destroyed.

[35] Mr Emery submits that the City, in arguing that it has lost trust and confidence in him, relies on an erroneous reading of the findings in the 2018 Decision as to a valid reason. He says that he gave contrary evidence to that of Mr Snook but that he did so does not support a finding of a loss of trust and confidence.

[36] Mr Emery submitted that the evidence given by others in respect to trust and confidence is based on speculation of what may happen in the future. Mr Emery submits that it is “a bit rich” to blame him for any mistrust within the Beach Inspectors Team over the last two years as he has not been at work since March 2017 when his employment was terminated.

[37] Mr Emery further submits that any stress or anxiety that may exist within the Beach Inspectors Team, cannot all be put down to him although agrees that the genesis of the stress was his dismissal from the workplace. In any event he says that the City has “cured the problem” by the engagement of TCC and Mr Halford could continue to assist team members if the stress or anxiety flared up.

[38] Mr Emery said that the fact that the position he occupied has been filled by another person on an on-going basis is not a ground for finding the reinstatement is inappropriate.

[39] Mr Emery also submits that there is no chance of conflict between him and Mr Trevor Holland who was responsible for his dismissal as Mr Holland has since retired.

[40] Mr Emery submits that the position of the City that he should not be reinstated because it has grounds on which to take disciplinary action against him including dismissal is groundless. He submits that the findings in the 2018 Decision were that he had breached policies of the City but, he submits, there is no contractual requirement or requirement under the relevant Enterprise Agreement that he comply with polices at all time. With respect to the intent of the City to conduct another investigation he says that it cannot be presumed such an investigation would result in his dismissal as the Commission found that an investigation that was procedurally fair may have resulted in a different outcome.

[41] The City submits that it is relevant to take into account the fact that Mr Emery was found by the Commission to have engaged in misconduct and that this provided as a valid reason for his dismissal in determining if reinstatement is impracticable because of a loss of trust and confidence. Further, the City submits that there is no absolute right of Mr Emery to be reinstated and that it is his misconduct, as found by the Commission, that has caused matters to come to this point. The City cautions against a presumption that, but for the procedural defects in the process found by the Commission, Mr Emery would still be in employment and therefore should be reinstated.

[42] The City says that, notwithstanding the procedural defects identified in the 2018 Decision, the loss of trust and confidence and other matters contended by the City are such that the Commission should not order reinstatement.

[43] The City submits that the evidence of Mr Emery indicates that he has still not acknowledged his misconduct nor has he recognised the effects of that misconduct. It says that Mr Emery cannot seriously consider that because Mr Holland is no longer employed by the City that there is no longer any issues between him and the City. Further, it says that weight should not be given to Mr Emery’s length of service with the City prior to his dismissal given his failure to acknowledge his misconduct.

[44] The City submits that the loss of trust and confidence in Mr Emery expressed by Mr Snook is not speculative but is based on Mr Emery’s conduct of his unfair dismissal proceedings and the requirements of the Beach Inspectors Team. Likewise it says that Mr Gugiatti explained the basis for his loss of trust and confidence in Mr Emery.

[45] The City submits that Mr Cameron was an open and credible witness who had a sound and rational basis for the views he held.

[46] For these reasons the City submits I should find that it has discharged the onus on it to demonstrate a loss of trust and confidence in Mr Emery.

[47] The City submits that the Beach Inspectors Team is a small team that is engaged in safety critical work.

[48] The City says that I should be satisfied that the conduct of Mr Emery was serious misconduct for the purposes of considering reinstatement. It says this is evidenced by findings in the 2018 Decision where I found that in carrying out the modifications Mr Emery may have endangered himself or others. 18 The City says it is not relevant what the intent of Mr Emery was in making the modifications but that the consequence of this was the potential to harm others. It submits that Mr Emery has a duty of fidelity to his employer and in carrying out the modifications he breached this.

[49] Further, the City submits that the finding that the modifications had the ability to affect the lifesaving capacity of the City supports a finding that the conduct was serious misconduct or misconduct justifying immediate dismissal as it is conduct that breaches the relationship in the sense explained in Melbourne Stadiums Ltd v Sautner. 19 In any event the City contends that Mr Emery’s conduct is serious misconduct as provided for in the enterprise agreement.

[50] The City contends that it would be futile to reinstate Mr Emery. If he is reinstated an independent review will take place free of the procedural problems identified in the 2018 Decision. From the findings of the Commission it can be inferred that the likely outcome of such a review would be termination of employment.

[51] The City says that it is telling that Mr Emery did not call Mr Hardbattle to give evidence in proceedings. Mr Hardbattle had given evidence in support of Mr Emery at in the initial proceedings on 30 November 2017 and was available during these proceedings (he observed the day’s proceedings) and could have given evidence in relation to the comments Mr Snook and Mr Gugiatti said he had made which indicated he did not want Mr Emery to return to the workplace. The City says that it is reasonable that I draw an inference that Mr Hardbattle did not want Mr Emery to return to the workplace.

Should I order reinstatement of Mr Emery?

[52] The onus in establishing that trust and confidence has been lost (such that I might find reinstatement is not appropriate) rests, in this case, with the City. This, however, does not mean that Mr Emery does not need to meet the case that is put against him.

[53] In Nguyen the Full Bench acknowledged that there “may be a limited number of circumstances in which any ripple on the surface of the employment relationship will destroy its viability.” 20

[54] For the reasons set out below I am satisfied in this case that it is reasonably open to me to accept that the City has lost trust and confidence in Mr Emery.

[55] Mr Emery has failed to acknowledge his misconduct or recognise the effect of that conduct. He has had ample opportunity to do so in the initial proceedings, the re-hearing before me, in his witness statement for these remedy proceedings, in his viva voce evidence or through his representative. He has failed to do so. Despite the opportunities to do so Mr Emery has not moved from his position that Mr Snook invited, directed, requested or wanted him to undertake the repairs to the BIVs. In failing to acknowledge his misconduct Mr Emery has taken no steps since the 2018 Decision was issued to re-establish a relationship with those he says he now wants to return to work with. Whilst I may have found the decision to dismiss him to be unfair Mr Emery would be foolish to think that this wipes the slate clean – particularly in circumstances where there was a valid reason for his dismissal and where there was a direct conflict between his evidence and that of Mr Snook, the person he would be his team leader if he returned. This does not put the loss of trust and confidence as speculative but based on what has occurred and what Mr Emery has not done since the 2018 Decision was issued.

[56] Mr Emery has not engaged with any of the findings in the 2018 Decision including that he breached policy, that his actions had the ability to affect the lifesaving capacity of the City or that the consequence of his actions could have resulted in harm to others. Rather, he concentrated on his achievements since the time he was dismissed – none of which go the matters critical to his dismissal or, fundamentally, as to reasons why I should reinstate him (although I do not consider his attempts to maintain his skills inconsequential).

[57] Mr Emery demonstrated stubbornness in the initial proceedings, exemplified by an unwillingness to concede that he had not filed a wiring diagram for the BIV engine despite such a concession being made by his representative and there being no such diagram found in his materials. The evidence in this remedy proceeding does not suggest any change in this attitude.

[58] The Beach Inspectors is a small team – there a four of them along with Mr Snook, the team leader. An unwillingness of Mr Emery to admit to his serious error in undertaking the modifications to the BIVs must cast doubts as to whether he would admit such a failing in the future. The size of the team means they must be able to trust each other implicitly. It does not mean they must be friends but they must be able to have a belief that each will conduct themselves in a manner which will not cause concern to others.

[59] The evidence supports a finding that there is a level of angst and tension in the Beach Inspectors Team. TCC has been engaged and a Mr Halford is working with the team. Whilst I do not put all the angst down to Mr Emery I am satisfied that the split in the team in terms of the evidence given in the initial proceedings has clearly contributed to that. The comments by Mr Hardbattle in the mediation sessions, as stated in the evidence of Mr Snook and Mr Gugiatti, support the conclusion that the tension is partly attributable to these proceedings including the potential for Mr Emery to return to the workplace. There was no contradiction of Mr Gugiatti’s evidence as to the comments Mr Hardbattle made to casual life savers and in the mediation even though no explanation was given as to why Mr Hardbattle was not called to give evidence. I accept the evidence of Mr Gugiatti as truthful. Those comments of Mr Hardbattle support a finding that tension within the team is attributable to the dismissal of Mr Emery. There is no evidence to support a finding that this would dissipate should Mr Emery return.

[60] Even if I put to one side the views of Mr Snook (and I see no reason to do so) the evidence of Mr Gugiatti convinces me that the return of Mr Emery to the workplace has the potential to adversely affect the effective operation of the Beach Inspectors Team. Mr Gugiatti presented as a genuine and honest witness. He was open in his answers, providing an assessment of his views as to why he could not trust Mr Emery to be truthful. He willingly shared the issues that have confronted him since the modification of the BIVs and the instigation of the unfair dismissal proceedings by Mr Emery. Mr Gugiatti appears sensitive to the effect of team members appearing for different “sides” in the unfair dismissal application and has concerns that, should Mr Emery return to the workplace, and based on Mr Emery’s claims that Mr Snook told him to make the modifications, that Mr Emery may not be truthful with respect to his interactions with others. I have no reason not to accept his evidence as credible.

[61] I have not disregarded Mr Snook’s evidence in the remedy proceedings. I accept that he has reasonable cause to be concerned at the return of Mr Emery to the Beach Inspectors Team. Mr Emery based his case on Mr Snook’s approval of the modifications to the BIVs. Mr Emery has not resiled form his position and Mr Snook has a legitimate concern that Mr Emery will not follow instructions or will “make things up” to his own end. Whilst mounting a defence in proceedings contrary to that finally accepted by the Commission is not, in and of itself, grounds to prove the employment relationship is irrevocably destroyed, in this case there has been no recognition by Mr Emery that his version of events was not accepted and that the decision of the Commission was that he did not have approval of Mr Snook to undertake the modifications. In such circumstances Mr Snook has a sound basis for the concerns he has expressed should Mr Emery return to the workplace.

[62] The absence of Mr Holland from the workplace does not alleviate any concerns as to loss of trust and confidence. He is not the only employee of the City who needed to have trust and confidence in Mr Emery. Mr Cameron is entitled to have that trust and confidence in Mr Emery and, indeed, in all of the Beach Inspectors Team. Mr Cameron has no reason to not have trust and confidence in the team currently in place but he does have sound reasons for not having trust and confidence in Mr Emery. He is correct to be concerned as to the relationship between Mr Emery and Mr Snook and the relationship between Mr Emery and other members of the Beach Inspectors Team. He relies on Mr Snook and the Beach Inspectors to effectively carry out their responsibilities and there are potential adverse consequences should they not. Mr Cameron reached his view on the basis of the 2018 Decision and on reviewing transcript and evidence in the initial proceedings. I am satisfied that Mr Cameron has a defensible basis for his conclusion. Further, he has observed first-hand the tension within the Beach Inspectors Team and, for this reason, sought to engage TCC.

[63] For these reasons, in addition to my factual findings set out in the 2018 Decision that the conduct did occur, I am satisfied that the loss of trust and confidence by the City in Mr Emery is soundly based.

[64] Mr Emery, in his submissions, has failed to appreciate the effect of his actions. Whilst he may not have been in the workplace for the past two years his actions in modifying the BIVs and his unwillingness to acknowledge that this was not approved by Mr Snook has led directly to the situation in the workplace today where there is a level of distrust amongst the Beach Inspector’s Team. The ripples generated by Mr Emery’s misconduct continue to be felt today and these are not simply cured by the engagement of TCC.

[65] The Beach Inspectors Team is a small group of four employees with Mr Snook. Whilst the City may be a large employer this is not a case where Mr Emery can be placed into another part of the organisation or into another team of Beach Inspectors – there is only the one. His skills are in this area and, by his own reckoning he is a dedicated lifeguard who has “obtained appropriate qualifications in my chose profession.” In these circumstances it is difficult to envisage some other role at the City that Mr Emery would consider to be “equivalent” to that of beach inspector.

[66] As I said above I am satisfied that the City has grounds to have lost trust and confidence in Mr Emery. There are, in my view, enough “ripples” on the surface of the employment relationship to support such a finding.

[67] This is not the end of the matter however. As Mr Emery rightly pointed out the loss of trust and confidence does not in and of itself mean that reinstatement is impractical. I am satisfied that reinstatement is impractical in the circumstances where:

• Mr Emery seeks reinstatement to a small team;

• where the team leader (Mr Snook) is the person Mr Emery claimed had authorised the work that I found amounted to a valid reason for dismissal;

• where I found that I preferred the evidence of Mr Snook to that of Mr Emery;

• where there remains residual stress and anxiety within the team; and

• where Mr Emery has not acknowledged his misconduct or the effect of his conduct or his error

[68] For these reasons I do not consider it appropriate to reinstate Mr Emery.

[69] I have not addressed in these reasons the issue of whether Mr Emery is a fit and proper person to be appointed as an “authorised person” because it is not necessary for the purposes of this decision. I would observer however that if I considered reinstatement appropriate and had rejected the submissions of the City that it had lost trust and confidence in Mr Emery then it does not appear that there would be an impediment to Mr Emery being appointed as an “Authorised Officer” by the City.

Compensation

[70] Section 392 of the FW Act sets out the basis on which compensation may be awarded.

[71] The principles to be applied as to the determination of compensation are well settled. 21 The Sprigg22 formula is to be applied to arrive at an appropriate amount of compensation. The method of calculating compensation was also addressed in Bowden v Ottrey Homes Cobram and District retirement Villages Inc. T/A Ottrey Lodge23

[72] The City says that, in applying these principles I should take into account that, had Mr Emery’s employment not been terminated when it was, it is inevitable that he would not have remained employed for much longer as, if he had remained or was returned to the workplace it would undertake a further review of his conduct free of procedural defects identified in the 2018 Decision. It further submits that it is reasonable for me to infer from his misconduct and from what he has presented in proceedings that that there is only a small chance that such a review would result in anything but his dismissal. The City says that any period of projected employment of Mr Emery for the purposes of determining compensation should take into account.

[73] Mr Emery says that, had his employment not been terminated he would have remained at the City for an extended period of time. His evidence and submissions is that he is committed to the role he performed at the City as a Beach Inspector, he has continued to gain qualifications appropriate to the role and there are limited opportunities outside the City to perform such work.

[74] Whilst it is not an easy task it is necessary that I determine how long Mr Emery would have remained employed in order to determine the remuneration he has lost. For the reasons given below I am satisfied that Mr Emery would have remained employed for no longer than a further three months with the City.

[75] I have reached this conclusion because I am satisfied that, had the City undertaken a fresh investigation into the conduct of Mr Emery in modifying the BIVs such an investigation would have been free of the procedural defects identified by me in the 2018 Decision. Such an investigation would have been completed with a three month period I am satisfied that it may have taken this long as it would require the gathering of relevant material, a consideration of this, a chance for Mr Emery to respond and then an appropriate decision being made.

[76] Whilst in the 2018 Decision I found that I was “not convinced that the outcome would not have been different had a thorough and proper investigation been undertaken” 24 I have weighed this against the valid reason I found for the dismissal identified in the 2018 Decision. I would note however that this finding was based on the involvement of Mr Snook in the original investigation and not on any conflict in the evidence that could not be resolved. Despite the involvement of Mr Snook in the investigation I did make a positive finding that the evidence of Mr Snook was preferable to that of Mr Emery.

[77] Mr Emery’s employment was terminated on 3 March 2018. He had, at the time of the termination, worked for the City for a period of six years.

[78] At the time his employment was terminated Mr Emery’s annual wage was $77,137.94. His lost income for the period I consider he would have remained employed had his employment not been terminated is therefore $19,284.48. His lost remuneration is therefore $19,284.48 plus 9.5% superannuation.

[79] In that three month period following his dismissal the evidence is that Mr Emery did not have any earnings. Whilst he has, since his dismissal, established his own business there is no evidence it was operating or generated any income in the period I anticipate he would have remained in employment. I therefore make no deduction from the amount of lost remuneration for remuneration earned.

[80] There is no evidence of any impediment to Mr Emery taking up employment in the period following his dismissal. For this reason I see no reason to make any deduction for contingencies.

[81] Mr Emery’s evidence is that he has applied for over 70 positions since his employment was terminated. 25 This was not disputed. In evidence filed in the appeal proceedings in 2018 in relation to his application, Mr Emery filed material which support this claim and show he was actively seeking work. The evidence of Mr Emery also supports a finding that he was actively seeking to maintain and upgrade qualifications associated with his chosen profession.

[82] I am therefore satisfied that Mr Emery has sought to mitigate his loss. I do not make a deduction for any failure to do so.

[83] As the period I consider Mr Emery would have remained in employment with the City is passed I do not consider I need to take into account any remuneration Mr Emery would be likely to earn between the making of any order for compensation and the payment of that order.

[84] I do not consider that the order I intend to make will affect the viability of the City.

[85] I do not consider that there are any other relevant matters to consider in determining the amount of the order for compensation.

[86] However, s.392(3) of the FW Act requires that, if the Commission is satisfied that the misconduct of a person contributed to the decision to dismiss the employee, the Commission must reduce the amount of the order on account of the misconduct.

[87] There is, in this case, no question that the misconduct contributed to the decision to dismiss Mr Emery. In the 2018 Decision I found that his misconduct provided a valid reason for his dismissal.

[88] Mr Emery’s misconduct was inexcusable. As a result of it he lost his paid employment in his “chosen profession” which, as a result of this Decision he will not get back. I am required to reduce the amount of compensation he would receive because of this misconduct. In these circumstances I have decided that the amount of compensation should be reduced by 20% on account of Mr Emery’s misconduct.

[89] I have not included any amount for shock or distress.

[90] The amount I intend to order does not exceed the compensation cap.