| [2020] FWCFB 304 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.604—Appeal of decision
Central Queensland Services Pty Ltd
v
Tara Odgers
(C2019/6764)
DEPUTY PRESIDENT MILLHOUSE |
MELBOURNE, 24 MARCH 2020 |
Appeal against decision [2019] FWC 7150 of Commissioner Hunt at Brisbane on 15 October 2019 in matter number U2019/4118.
[1] Central Queensland Services Pty Ltd has applied, pursuant to s.604 of the Fair Work Act 2009 (Cth) (Act), for permission to appeal and appeals a decision of Commissioner Hunt issued on 15 October 2019 (decision). 1 The Commissioner found that while there was a valid reason to dismiss Ms Odgers the termination was unjust and unreasonable. The Commissioner ordered that the Appellant pay Ms Odgers $6,550.10 in compensation (less taxation as required by law) plus 9.5% superannuation.2
[2] The appeal relates to both the finding that the termination of Ms Odgers’ employment was unjust and unreasonable, and the reasoning regarding the order for compensation.
[3] For the reasons that follow, we have decided to grant permission to appeal the decision. We:
1. uphold appeal grounds 1(b), 1(c), 1(d), 2 and 3;
2. quash the decision; and
3. remit Ms Odgers’ application for an unfair dismissal remedy (matter U2019/4118) to the Regional Coordinator, Vice President Catanzariti, for allocation to a Member for redetermination.
[4] Ms Odgers commenced employment with the Appellant in early 2014 as a Mine Employee at the Caval Ridge Mine, operated by BHP. 3 She was engaged on a fly-in, fly-out basis and travelled to the mine via the Moranbah Airport.4 By letter dated 26 March 2019,5 Ms Odgers’ employment was terminated for:
(a) placing a sex toy and metal butter knives in a co-worker’s carry-on baggage as the co-worker went through airport security on 16 October 2018 (airport incident); and
(b) unbuttoning her work-issued shirt down to the last two buttons, exposing the top of her breasts and posing for a photograph at the mine with two female colleagues on 2 March 2019 (photograph incident).
[5] The airport incident came to the attention of the Appellant through an anonymous complaint on 13 February 2019. The (then) Production Superintendent Coal at Caval Ridge Mine, Mr Les Brown, made enquiries with staff at Moranbah Airport who confirmed that the airport incident occurred on 16 October 2018. Mr Brown met with Ms Odgers on 28 February 2019. During this meeting, Ms Odgers said that she took responsibility for the incident and that she had done it to “get back” at her co-worker. 6
[6] On 5 March 2019, before any further steps had been taken in respect of the airport incident, Mr Brown was notified that a photograph involving Ms Odgers and other employees in uniform exposing their breasts had been posted to Facebook. 7 Mr Brown met with Ms Odgers regarding the photograph incident on 13 March 2019. During this meeting, Ms Odgers said that she did not consider whether the conduct amounted to a breach of the Our Charter document (Charter); there was nothing identifying her specifically as she was not in standard uniform; and that she did not understand that the photograph would be uploaded to social media when she posed for it.8 She was stood down from work with pay that day.
[7] On 21 March 2019, Mr Brown sent Ms Odgers a letter which described the investigation findings in respect of these two incidents; advised that these matters were serious and constituted misconduct; confirmed that the admitted conduct was not tolerated; and informed Ms Odgers that the Appellant was considering taking disciplinary action, including potential termination of employment (show cause letter). 9 The letter required Ms Odgers to show cause why her employment should not be terminated.
[8] Ms Odgers responded to the show cause letter in writing on 22 March 2019. 10 In the response, Ms Odgers said that:
(a) she placed a butter knife and sex toy into her co-worker’s hand luggage as a prank;
(b) the photograph was not intended for social media, and a third party viewing the photograph would not be able to identify where it was taken or the identity of her employer. However, she was extremely embarrassed and remorseful;
(c) she had been an outstanding female member of the team, reflected by her performance review and her extra duties on site. She did not intend to cause harm to her colleagues or the company brand.
[9] As earlier stated, Ms Odgers was dismissed on 26 March 2019. 11
[10] In considering the criteria under s.387 of the Act, the Commissioner engaged in a detailed summary of the evidence and submissions. In relation to s.387(a) of the Act, the Commissioner found that the airport incident and photograph incident gave rise to a valid reason for the dismissal. 12 The Commissioner also concluded that Ms Odgers breached the Charter values of respect and integrity and the Code of Conduct (Code), despite receiving refresher training.13
[11] The Commissioner also found that Ms Odgers had taken butter knives from the Appellant without permission, made a false statement to the Appellant during its investigation of the airport incident, and “invented” evidence given at the Commission hearing. These matters were not known to the Appellant at the time of the dismissal and accordingly did not form part of the Appellant’s decision to terminate. Rather, these matters came to light during the hearing before the Commissioner.
[12] In respect of s.387(b), the Commissioner determined that Ms Odgers was notified that the reason for her dismissal was her misconduct in the airport incident and the photograph incident. 14 However, the Commissioner considered that the Appellant did not properly notify Ms Odgers of her obligations under the Charter that it considered to have been breached. This concern arose because the termination letter stated that Ms Odgers’ conduct and behaviour gave rise to a breach of the Charter value of respect and integrity, while the show cause letter referred only to a breach of the value of respect.15 This led the Commissioner to conclude that Ms Odgers was not notified ahead of her termination that the reason for her dismissal included a finding that she had breached the Charter value of integrity.16 This resulted in a finding of non-compliance with s.387(b) of the Act.
[13] As to s.387(c), the Commissioner found that Ms Odgers was given an opportunity to respond to the matters set out in the show cause letter which grounded the termination of her employment. 17 However, the Commissioner identified two concerns which led to a finding that s.387(c) had not been satisfied.
[14] The first concern is that the Appellant did not address with Ms Odgers complaints that were made concerning her conduct on a charter bus between Moranbah Airport and Caval Ridge Mine in September 2018. The Commissioner found that the Appellant relied upon Ms Odgers’ conduct during the bus trip “as a persuasion” to dismiss Ms Odgers following the airport incident and photograph incident. 18
[15] The second concern raised by the Commissioner is that the Appellant failed to follow the BMA Guideline to Fair Play policy (Fair Play Guidelines) in effecting Ms Odgers’ dismissal. 19 The Commissioner explained this position as follows:
“Of incredible concern to me is the abject failure of the respondent, through Mr Brown, to adhere to its obligations to follow the BMA Guideline to Fair Play policy (Fair Play Guidelines). As I explained to the parties during the hearing, in other BMA or other associated entity matters that have been before me, it has often been presented that the Fair Play Guidelines are a “bible”. Most concerning was during the first day of hearing when it was suggested by Mr McLean that the respondent is not obligated to follow the Fair Play Guidelines.” 20
[16] The Commissioner determined that Ms Odgers did not have the opportunity to discuss the steps in the Fair Play Guidelines, or the potential for a final written warning or a suspension without pay. The Commissioner said:
“I determine that where Ms Odgers had an expectation that the respondent would meet its enterprise agreement obligations to apply the Fair Play Guidelines, it failed to do so without any adequate explanation. Mr Brown simply did not utilise them. His evidence is that he usually does, but he also gave evidence that he considers them to be a guideline only, and not a requirement. Whilst Mr Brown did, in the show cause letter cite that he considered her conduct to be intentional, he didn’t explain the context of such finding.
Ms Odgers, and any employee employed by the respondent and covered by the agreement is owed an opportunity to influence the decision maker. It is a strict obligation, agreed to by the respondent and in place for many years. In fact the Fair Play Guidelines are dated November 2013. There is no adequate explanation as to why the Superintendent, as Mr Brown was, chose to follow them or not. There is an obligation to follow them.
Given that Mr Brown was of the view that the airport incident did not warrant dismissal with the information that he had before him at the time, it was appropriate in all of the circumstances for Mr Brown to discuss with Ms Odgers following the investigation, (by telephone, if necessary), and determine which step within the Guidelines he would determine was the appropriate step. He did not assert that pursuant to clause 5 of the Fair Play Guidelines that it was “serious misconduct”, even if it was later asserted that it could amount to serious misconduct. It was certainly misconduct, but Mr Brown never determined that it was serious misconduct to warrant an excuse not to follow the disciplinary procedure within the Fair Play Guidelines. He just did not do it.
Where it was submitted that the photo incident could amount to serious misconduct, the Fair Play Guidelines were not carried out for any of the employees involved. Mr Brown never asserted that the reason why he didn’t complete the Fair Play Guidelines for all five employees was because he considered for each of them the misconduct amounted to serious misconduct. He just did not do it.
In consideration of s.387(c) of the Act, I determine that Ms Odgers was not provided with an opportunity to effectively influence or encourage Mr Brown in his decision making relevant to the reasons for the dismissal. She did not, as is required, have the opportunity to discuss the various steps within the Fair Play Guidelines, or to address Mr Brown on the potential of a final written warning and/or being suspended for a period of time without pay. It is true that she had an opportunity within the written show cause response to advance mitigation, but Mr Brown, it seems, did not ever turn his mind to the potential of an unpaid stand down.” 21
[17] The Commissioner next made findings in respect of the matters in s.387(d)-(g) of the Act which are not challenged in the appeal.
[18] In respect of s.387(h), the Commissioner considered Ms Odgers’ age and service of approximately five years and said:
“I have also taken into consideration the information that became available to the Commission during the hearing relevant to Ms Odgers’ false statement to Mr Brown on 28 February 2019 that she was the only person involved in recording the airport incident, and her theft of the butter knives from the respondent.
I confirm that for the purposes of s.387 of the Act, I have not taken into account what I consider to be her falsified statement to the Commission that she held a discussion with Mr Hill prior to the airport incident occurring.” 22
[19] The Commissioner concluded as follows:
“In no uncertain terms, Ms Odgers’ misconduct was unacceptable. On being alerted that Mr Brown was investigating her and the investigation was still on foot, Ms Odgers decided to partly undress in the workplace just two days later and allow a photograph to be taken of her and others. If she did not think the respondent was serious about the first incident because it had occurred so many months before, she should have done what she said she would do, and “keep to herself”.
Without any regard for how precarious her employment might be, she stood on a table and participated in the photo incident. Her foolishness in being involved in both incidents is demonstrated by her evidence before the Commission that she did not regard the photo as inappropriate. She agreed during the show cause process that she was remorseful and she should not be dismissed over the incident, but during the hearing attributed the posing for the photo as nothing more than cleavage. Her suggestion that sometimes women walk from the camp gym to their camp rooms in gym gear is not comparable at all to the behaviour she engaged in during the photo incident.
As stated earlier, however, I am deeply troubled by the respondent’s failure to meet its lawful obligations to comply with the enterprise agreement it has entered into. The Fair Play Guidelines are a requirement to follow; they are not just something that can be completed whenever a manager decides he or she will do so.
The size of the respondent and its obligation to its employees warrants a firm position on this matter by the Commission as currently constituted. The respondent was obliged to consult with Ms Odgers and inform her of its decision relevant to the Just Culture Decision Making Tree. She was entitled to be informed that following the investigation, the respondent considered her conduct to be intentionally deviant. I agree that for both incidents it was intentionally deviant and in breach of the reasonable Charter Values and the Code of Conduct.
If Mr Brown had met his obligations, Ms Odgers may have discovered that Mr Brown was, in part, also relying on her purported conduct in September 2018 relevant to the bus incident. She might have had the opportunity to convince him of a lesser step, or an unpaid suspension. She might have convinced Mr Brown to issue to her a first and final warning as he did for Mrs James.
I accept that a respondent, any respondent, may not always procedurally ensure it meets its obligations to ensure that a dismissal is valid and procedural fairness has been appropriately afforded to a dismissed employee. In considering whether a dismissal is unfair, a respondent won’t be required to meet every obligation; it is a balancing act, hence the fair go all ‘round. It is important in this case to note that while the substance of the incidents was put to Ms Odgers consistently in the investigation and show cause letters, and the conduct was accepted by Ms Odgers, the respondent ultimately dismissed Ms Odgers for additional breaches of the Charter Values and Code of Conduct. As stated by me during the hearing, if a respondent the size of this respondent can’t appropriately marry its investigation findings with its termination letter, what hope do smaller employers have?
Commissioner Cirkovic recently held in Michael Scott v Latrobe Regional Hospital 2019 [FWC] 5680:
“Failure to follow Enterprise Agreement disciplinary procedure
[83] The Applicant submitted that I should have regard to an alleged failure of the Respondent to follow the investigation and disciplinary procedures in the Enterprise Agreement. The Respondent submitted that it had complied with the relevant procedures. Clause 8.4 of the Enterprise Agreement is set out below.
………………………
………………………
[84] Based on the material before me, I am satisfied that the letter to the Applicant dated 18 July 2019 is unequivocally part of an investigation process; not a written record of the outcome of the investigation. The written outcome of the investigation, including findings and the bases of the Respondent’s conclusions, was provided to the Applicant in the letter of termination dated 6 August 2019. Pursuant to clause 8.4, the Respondent was required to “meet with the employee” before taking the disciplinary action that it did. Based on the above, I am satisfied that the Respondent failed to follow the disciplinary process set out in the Enterprise Agreement, and in the circumstances, this contributes to the unreasonableness of the dismissal.”
I wish to reiterate that each time this respondent has a matter before me I will not hold it to the highest standard of ensuring every inch of procedural fairness has been afforded to a dismissed employee. In every matter the circumstances of each dismissal will be given appropriate consideration.
However, for the respondent to have no regard at all to its obligations in this matter of applying the Fair Play Guidelines pursuant to the relevant enterprise agreement, means that despite there being a valid reason for the dismissal, and despite Ms Odgers knowing the context of the respondent’s findings in relation to each of the incidents, I conclude that for the reasons above, the dismissal was unjust and unreasonable.
Accordingly I determine that Ms Odgers’ dismissal was unfair.” 23
[20] The Commissioner turned to the question of remedy and found that reinstatement was inappropriate. The Commissioner said:
“I have also taken into consideration the additional evidence given during the hearing. It has become clear that Ms Odgers told Mr Brown an untruth during the investigation meeting of 28 February 2019. She said she did so because she did not want to get other employees into trouble.
Further, it was discovered that Ms Odgers had taken the butter knives belonging to the respondent without authorisation. I accept that they are of nominal value, but she still decided to misappropriate them.
Most alarming is my finding that Ms Odgers fabricated evidence to point the finger at Mr Hill and allege that Mr Hill knew about the airport incident some time before it occurred, and encouraged her to use spoons or knives.
I do not consider it appropriate to reinstate Ms Odgers to her former position. I accept that the respondent has lost trust and confidence in Ms Odgers to be an honest employee employed by it.” 24
[21] After considering the matters in s.392(2) of the Act, the Commissioner reduced the compensation amount by 50% on account of her finding that Ms Odgers “most certainly” engaged in misconduct. 25 The Commissioner ordered the Appellant to pay Ms Odgers compensation totalling $6,550.10 (less taxation as required by law), plus superannuation at the rate of 9.5%.
[22] The Appellant’s notice of appeal identifies errors in the substantive finding that the dismissal was “unjust and unreasonable,” as well as in the Commissioner’s reasoning regarding the order for compensation.
[23] The appeal grounds concerning the unjust and unreasonable finding contend that the Commissioner erred by:
(a) having regard to irrelevant considerations in the assessment of the misconduct (appeal ground 1(a));
(b) having regard to irrelevant considerations in the assessment of ss. 387(b) and (c) of the Act (appeal ground 1(b));
(c) concluding that there was a requirement for the Appellant to consider an alternative to dismissal (appeal ground 1(c));
(d) relying upon representations said to have been made in unrelated proceedings as to the significance of the Fair Play Guidelines (appeal ground 1(d)); and
(e) concluding that the alleged procedural shortcomings were demonstrative of injustice or unreasonableness without properly considering whether those shortcomings occasioned genuine prejudice or were capable of altering the outcome (appeal grounds 2 and 3).
[24] The appeal grounds regarding compensation contend that:
(a) in ordering the payment of compensation, the Commissioner failed to have regard to Ms Odgers’ dishonesty during the investigation and during the hearing (compensation ground 1);
(b) in the alternative to the above, the Commissioner erred in applying a discount of only 50% on account of Ms Odgers’ misconduct for the purposes of s.392(3) (compensation ground 2); and
(c) the methodology for calculating compensation was wrong (compensation ground 3).
[25] The Appellant submits that permission to appeal is in the public interest primarily because the errors identified go to the Commission’s approach to the application of the statutory criteria in ss. 387 and 392 of the Act.
[26] Ms Odgers contends that the appeal ought to be dismissed. She says that there is no public interest in the appeal and the Commissioner acted within her discretion.
[27] An appeal under s.604 of the Act is an appeal by way of rehearing and the Commission’s powers on appeal are only exercisable if there is error on the part of the primary decision maker.26 There is no right to appeal and an appeal may only be made with the permission of the Commission.
[28] This appeal is one to which s.400 of the Act applies. Section 400 provides:
(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.
[29] In Coal & Allied Mining Services Pty Ltd v Lawler and others, 27 Buchanan J (with whom Marshall and Cowdroy JJ agreed) characterised the test under s.400 as “a stringent one.” The task of assessing whether the public interest test is met is a discretionary one involving a broad value judgment.28 In GlaxoSmithKline Australia Pty Ltd v Makin, a Full Bench 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.” 29
[30] 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.30 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.31
[31] The decision under appeal is of a discretionary nature. Usually, such a decision can only be successfully challenged on appeal if it is shown that the discretion was not exercised correctly. 32 It is not open to an appeal bench to substitute its view on the matters that fell for determination before the Commissioner at first instance in the absence of appealable error. As the High Court said in House v The King:
“The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred.” 33
[32] We are satisfied, for the reasons that follow, that appealable error has been established and that on this basis there is public interest in granting permission to appeal. The appeal raises important questions about the construction and application of aspects of s.387 of the Act. Permission to appeal must therefore be granted.
[33] In determining this matter, we need only deal with the grounds of appeal which relate to the process adopted by the Appellant in terminating Ms Odgers’ employment. This is because the Commissioner’s findings as to the opportunity given to Ms Odgers to respond to the reasons for the dismissal led to the conclusion that the dismissal was unjust and unreasonable.
[34] By appeal grounds 1(b) and 1(c), the Appellant contends that the Commissioner had regard to irrelevant considerations in the assessment of ss.387(b) and (c) of the Act. These provisions relate to the concept of procedural fairness and the need to afford an affected person an opportunity to present a case, as it relates to the valid reason. 34
[35] Section 387(b) requires the Commission to have regard to whether an employee was notified of that reason. This notification relates to the valid reason for dismissal. 35 Section 387(c) then deals with the question of whether the employee was given an opportunity to respond to any reason related to their capacity or conduct. If there is no valid reason, s.387(c) has no work to do.36
[36] In the matter before us, Ms Odgers admitted to the airport incident at the meeting on 28 February 2019 and the photograph incident at the meeting on 13 March 2019. 37 The Commissioner found that the airport incident and the photograph incident gave rise to a valid reason for the dismissal.38 The Commissioner accepted that these matters were put to Ms Odgers in the show cause letter and she was given an opportunity to “advance mitigation” in respect of them.39
[37] Notwithstanding this finding, the Commissioner concluded that Ms Odgers was not given an opportunity to discuss with Mr Brown the steps contained in the Fair Play Guidelines or potential alternatives to dismissal. This led the Commissioner to conclude that the Appellant did not comply with s.387(c) of the Act. 40
[38] The Commissioner determined that Mr Brown was obliged to apply the four-step disciplinary process in the Fair Play Guidelines. 41 The Fair Play Guidelines relevantly provide as follows:42
“5. Disciplinary Procedure
Except for instances of serious misconduct, the following four step disciplinary process will be applied.
The application of the Just Culture Decision Tree together with the particular circumstances and severity of each case will determine the appropriate disciplinary action Step to be taken with respect of an Employee. The relevant Steps are as follows:
Step 1 An Employee will be verbally counselled by their Supervisor. Where requested by the Employee, a Supervisor will conduct the counselling in the presence of an Employee Representative. Written notice of the verbal counselling will be provided to the Employee and a copy placed on the Employee’s file; or
Step 2 An Employee will be counselled by their Supervisor in the form of a formal warning. Where requested by the Employee, a Supervisor will conduct the counselling in the presence of an Employee Representative and have the warning confirmed in writing. A copy of the formal warning will be provided to the Employee and also be placed on the Employee’s file; or
Step 3 An Employee will be issued a final warning by their Supervisor or Department Manager or Superintendent. Where requested by the Employee, the Company representatives will conduct the counselling in the presence of an Employee Representative, and have the final warning confirmed in writing and the Employee will be advised that dismissal may result from any further act of misconduct. In addition, the Company can stand down the Employee without pay for up to 21 calendar days. A copy of the formal warning will be provided to the Employee and placed on the Employee’s file; or
Step 4 Disciplinary action, which is commensurate with the severity and/or frequency of the act(s) of misconduct will be taken.
As a general guide the disciplinary procedure will work on a sequential basis e.g. first breach results in Step 1, an additional breach within a 12 month period results in Step 2, etc. However, where a Supervisor and Department Manager/Superintendent deem that the circumstances warrant the action, an Employee may be placed on a step that is not sequential…”
[39] The Appellant submits that the Commissioner erred by concluding that it had not complied with s.387(c) of the Act. It contends that the Commissioner “laboured” the Appellant’s failure to apply the Fair Play Guidelines in circumstances where this was not relevant to the assessment of whether Ms Odgers was afforded an opportunity to respond to the reasons for her dismissal pursuant to s.387(c). The Appellant also submits that the Commissioner erred by taking into account its alleged failure to consider suspending Ms Odgers from her employment as an alternative to dismissal. It says that Ms Odgers was clearly afforded (and exercised) the opportunity to respond contemplated by s.387(c) of the Act, through the show cause process.
[40] In our determination of this matter, the observations of the Full Bench in Abdel-Karim Osman v Toyota Motor Corporation Australia Ltd 43 are apposite. The Full Bench described the obligation to provide an opportunity to respond as requiring an employer to take reasonable steps to investigate the allegations and give the employee a fair chance of answering them.44 It adopted the observations of Wilcox CJ in Gibson v Bosmac Pty Limited,45 approved by Northrop J in Selvachandran v Peteron Plastics Pty Ltd,46 where Wilcox CJ said:
“…Ordinarily, before being dismissed for reasons related to conduct or performance, an employee must be made aware of the particular matters that are putting his or her job at risk and given an adequate opportunity of defence. However, I also pointed out that the section does not require any particular formality. It is intended to be applied in a practical, commonsense way so as to ensure that the affected employee is treated fairly. Where the employee is aware of the precise nature of the employers concern about his or her conduct or performance and has a full opportunity to respond to this concern, this is enough to satisfy the requirements of the section.” 47
[41] We adopt these observations in our assessment of the Commissioner’s approach to the application of s.387(c). We find that by focussing on a perceived failure to comply with the Fair Play Guidelines, irrespective of the show cause process, the Commissioner had regard to an irrelevant consideration.
[42] Section 387(c) is concerned with whether an employee was, in substance, afforded an opportunity to respond to the reasons for the dismissal. 48 It does not mandate rigid compliance with any specified procedure. It is sufficient that the employee is made aware of the precise nature of the concern held about their conduct or performance and given a full opportunity to respond to it. The Commissioner’s conclusion that Ms Odgers was given, through the show cause process, an opportunity to respond and advance mitigation to the matters constituting a valid reason for her dismissal,49 appears, in our view, to satisfy the opportunity contemplated by the authorities. We therefore consider that the Commissioner misapprehended the statutory task under s.387(c). This gives rise to appealable error.
[43] Further, the Appellant was not required to consciously consider or discuss with Ms Odgers the appropriateness (or otherwise) of possible alternative disciplinary outcomes in order to comply with s.387(c). Nor does s.387(c) require this. In any case, in her show cause response, Ms Odgers explained why she considered she should remain in employment. 50 By concluding as the Commissioner did at [240], the Commissioner acted on a wrong principle. This too gives rise to appealable error.
[44] In light of these errors, we find that the Commissioner miscarried her discretion in the application of this statutory criterion. We therefore uphold appeal grounds 1(b) and 1(c).
[45] We note that the Commissioner also determined that there was non-compliance with:
(a) s.387(b) of the Act, occasioned by the Appellant’s failure to notify Ms Odgers that her conduct and behaviour had breached the Charter value of integrity. The Appellant’s submissions in the appeal do not address this. However, we observe that the Commissioner found that the Appellant had notified Ms Odgers “that the reason for her dismissal was her misconduct in the airport incident and the photo incident.” 51 That is, the Commissioner found that Ms Odgers was notified of the valid reason for her dismissal; and
(b) s.387(c) of the Act because the Appellant relied upon Ms Odgers’ conduct during a bus trip in September 2018 “as a persuasion” to dismiss her. 52 The Commissioner concluded that Ms Odgers was not afforded the opportunity to respond to this matter.53 The Appellant’s submissions in the appeal also do not address this. However, we observe that the Commissioner’s conclusion is contrary to Mr Brown’s evidence in the proceedings. In response to a direct question from the Commissioner on this point, Mr Brown said that he based his decision to terminate Ms Odgers on the information before him as to the airport incident and the photograph incident.54
[46] Given the parties did not address us on either matter, we consider it unnecessary to embark upon a detailed analysis of these matters in the appeal before us.
[47] Furthermore, it is not our position that the question of compliance with the Fair Play Guidelines is irrelevant. It is a consideration that may be pertinent in the assessment of s.387(h) of the Act. Section 387 does not require any greater or lesser weight to be assigned to paragraph (h). The weight attributed to the question of compliance with an internal disciplinary process is a matter for the Commission member, in the exercise of his or her discretion. 55 We note the observations of a Full Bench in Farquarson v Qantas Airways Ltd56 that where an employee’s misconduct has been the subject of a full hearing in the Commission and the dismissal found to be justified, it will be rare for a defect in an internal disciplinary process to justify a conclusion that the termination was harsh, unjust or unreasonable:
“The fact of unfairness in the employer’s decision making process, even if it involves a breach of a term in a certified agreement, is but a factor to be taken to account in determining whether a termination of employment was harsh, unjust or unreasonable. In circumstances where, as here, the merits of a termination of employment based on misconduct have been the subject of a full hearing in the Commission (in which the employer must establish the alleged misconduct on the balance of probabilities) and the dismissal has been found to be justified, it will be rare for a defect in an internal disciplinary process that preceded the termination justifying a conclusion that the termination was harsh, unjust or unreasonable. This is so because, almost invariably in such circumstances, it may be inferred that the outcome of the disciplinary process would have been the same even if there had been no such defect.” 57
[48] Turning to appeal ground 1(d), the Appellant challenges the Commissioner’s approach to the analysis of the Fair Play Guidelines and its role in the Appellant’s workplace. The Appellant contends that it was deprived of procedural fairness for two reasons. Firstly, the Appellant says that the Commissioner erred by placing reliance upon representations said to have been made in unrelated proceedings involving the Appellant (or its associated entities) regarding the Fair Play Guidelines. 58 Secondly, the Appellant submits that the Commissioner’s failure to raise her “preconceptions” as to the role of the Fair Play Guidelines until after the evidence had concluded deprived the Appellant of procedural fairness.59
[49] In the decision, the Commissioner said:
“As I explained to the parties during the hearing, in other BMA or other associated entity matters that have been before me, it has often been presented that the Fair Play Guidelines are a “bible.” Most concerning was during the first day of hearing when it was suggested by Mr McLean that the respondent is not obliged to follow the Fair Play Guidelines.” 60
[50] The Appellant contends that during the proceedings the Commissioner put to it that the Charter values (being an entirely distinct document) were “like a bible” – not the Fair Play Guidelines. A review of the transcript bears this out. 61
[51] The Appellant addressed the Commissioner as to the application of the Fair Play Guidelines as it related to its decision to terminate Ms Odgers. Mr Brown gave evidence that the Fair Play Guidelines allow the Appellant to move straight to any one of the four steps if it considers the misconduct to be sufficiently serious. 62 The Appellant contends that the Fair Play Guidelines enable it to implement any one of the disciplinary actions commensurate with an employee’s misconduct. In respect of Ms Odgers, it submitted that the show cause process satisfied its obligations under the Fair Play Guidelines. However, the Appellant’s submissions could not address the representations made in unrelated proceedings because these matters were not made known to the Appellant.63
[52] As a consequence of the Commissioner’s reliance upon such representations in the decision, we accept that the Commissioner had regard to irrelevant considerations. 64 Further, in the absence of an explanation of these matters by the Commissioner, the Appellant was deprived of procedural fairness. It was not given an opportunity to respond directly to the extraneous matters, and nor was the Appellant on notice that the extraneous matters would have a bearing upon the determination of the application.
[53] We consider that these matters had the effect of denying the Appellant the possibility of a successful outcome. 65 Accordingly, we uphold appeal ground 1(d).
[54] By appeal grounds 2 and 3, the Appellant contends that the Commissioner erred by concluding that the alleged procedural shortcomings were demonstrative of injustice or unreasonableness. It says that even if there was non-compliance with the Fair Play Guidelines, that procedural defect of itself should not found a conclusion of unreasonableness or unjustness unless it is demonstrated that those procedural deficiencies prejudiced Ms Odgers or otherwise gave rise to the potential for a different outcome. It says that despite there being a full hearing before the Commission, Ms Odgers failed to identify any additional material information that could have been raised through the disciplinary process had any of the supposed procedural deficiencies been rectified.
[55] Section 387 of the Act requires the Commission to consider whether a dismissal was harsh, unjust or unreasonable by taking into account the matters at subsections (a) to (h). The meaning of the expression harsh, unjust or unreasonable was described by McHugh and Gummow JJ in Byrne v Frew v Australian Airlines Limited: 66
“It may be that the termination is harsh but not unjust or unreasonable, unjust but not harsh or unreasonable, or unreasonable but not harsh or unjust. In many cases the concepts will overlap. Thus, the one termination of employment may be unjust because the employee was not guilty of the misconduct on which the employer acted, may be unreasonable because it was decided upon inferences which could not reasonably have been drawn from the material before the employer, and may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted.”
[56] In a case where a member of the Commission determines that a dismissal is harsh, or is unjust, or is unreasonable, the factual basis and reasoning for the relevant finding made needs to be set out. 67 Having regard to the Commissioner’s findings in the decision, we do not consider that the conclusion that the dismissal was unjust was open in light of Ms Odgers’ admitted conduct and behaviour, which the Commissioner determined to be “intentionally deviant.”68 Nor is a conclusion that the dismissal was unreasonable sustainable in the circumstances. The Appellant’s conclusion as to Ms Odgers’ conduct and behaviour was founded on the admitted conduct. The proceedings before the Commissioner did not reveal any additional matters that were capable of affecting the outcome.
[57] Given these matters, we consider that the Commissioner erred by concluding that the dismissal was unjust and unreasonable. Accordingly, we uphold appeal grounds 2 and 3.
[58] We do not find it necessary to consider the other grounds of appeal. The errors that we have identified lead us to conclude that the appeal must be allowed as the discretion vested in the Commissioner miscarried.
[59] The Appellant submits that this Full Bench ought redetermine the matter on the material before us. However, it is apparent from the proceedings that the role of the Fair Play Guidelines was not adequately addressed before the Commissioner. This is a matter that may be relevant in the application of s.387(h) of the Act and is an issue in respect of which the parties may wish to be heard.
[60] Accordingly, we order that:
1. appeal grounds 1(b), 1(c), 1(d), 2 and 3 are upheld;
2. the decision [2019] FWC 7150 is quashed; and
3. the application for an unfair dismissal remedy made by Ms Odgers in U2019/4118 is remitted to the Regional Coordinator, Vice President Catanzariti, for allocation to a Member for redetermination.
DEPUTY PRESIDENT
Appearances:
J McLean, for the Appellant
C Van Oeveren and M Heffernan, for the Respondent
Hearing details:
2019.
Melbourne via VC to Brisbane and Adelaide.
10 December.
Printed by authority of the Commonwealth Government Printer
<PR716055>
2 PR713396
3 Appeal book p.449
4 Ibid p.452
5 Ibid pp.482-483
6 Ibid p.468
7 Ibid p.419 at [28]
8 Ibid pp.473-474
9 Ibid pp.476-477
10 Ibid pp.479-480
11 Ibid pp.482-483
12 Decision [204]
13 Ibid [204], [206]-[207], [252]
14 Ibid [216]
15 Ibid [208]-[214]
16 Ibid [217]
17 Ibid [218], see also [204]
18 Ibid [219], [235]
19 Ibid [229]
20 Ibid [220]
21 Ibid [236]-[240]
22 Ibid [247]-[248]
23 Ibid [249]-[258]
24 Ibid [270]-[273]
25 Ibid [289]
26 This is so because on appeal the Commission has power to receive further evidence, pursuant to s.607(2); see Coal and Allied v AIRC [2000] HCA 47, 203 CLR 194 at [17] per Gleeson CJ, Gaudron and Hayne JJ
27 (2011) 192 FCR 78 at [43]
28 O’Sullivan v Farrer [1989] HCA 61, 168 CLR 210 per Mason CJ, Brennan, Dawson and Gaudron JJ; applied in Hogan v Hinch [2011] HCA 4, 243 CLR 506, 85 ALJR 398 at [69] per Gummow, Hayne, Heydon, Crennan, Kiefel and Bell JJ; Coal & Allied Mining Services Pty Ltd v Lawler and others [2011] FCAFC 54, 192 FCR 78, 207 IR 177 at [44]-[46]
29 [2010] FWAFB 5343, 197 IR 266 at [24] – [27]
30 Wan v AIRC [2001] FCA 1803, 116 FCR 481 at [30]
31 Lawrence v Coal & Allied Mining Services Pty Ltd t/as Mt Thorley Operations/Warkworth [2010] FWAFB 10089, 202 IR 388 at [28], affirmed on judicial review in Coal & Allied Mining Services Pty Ltd v Lawler [2011] FCAFC 54, 192 FCR 78, 207 IR 177; NSW Bar Association v Brett McAuliffe; Commonwealth of Australia represented by the Australian Taxation Office [2014] FWCFB 1663, 241 IR 177 at [28]
32 House v The King (1936) 55 CLR 499 at [504]-[505] per Dixon, Evatt and McTiernan JJ
33 Ibid
34 Crozier v Palazzo Corporation Pty Limited t/as Noble Park Storage and Transport, Print S5897 at [70]
35 Chubb Security Australia Pty Ltd v Thomas Print S2679 at [41]
36 Ibid
37 Appeal book pp.468, 472-474
38 Decision [204]
39 Ibid [218], [240]
40 Ibid [240]
41 Appeal book pp.382-395
42 Ibid pp.384-385
43 Abdel-Karim Osman v Toyota Motor Corporation Australia Ltd, PR910409 (17 October 2001 per Ross VP, Lacy SDP and O’Connor C)
44 Abdel-Karim Osman v Toyota Motor Corporation Australia Ltd, PR910409 (17 October 2001 per Ross VP, Lacy SDP and O’Connor C) at [68]; Schaale v Hoechst Australia (1993) 47 IR 249 at 252 per Heery J
45 (1995) 60 IR 1
46 (1995) 62 IR 371
47 Ibid at 379, 380
48 Gibson v Bosmac Pty Ltd (1995) 60 IR 1, 7
49 Decision [204], [218] and [240]
50 Appeal book pp. 479-480
51 Decision [216]
52 Ibid [219]
53 Ibid [235]
54 Transcript of proceedings dated 16 and 17 July 2019 (Transcript) [1604]
55 Diaz, Guillermo (William) v Anzpac Services (Australia) Pty Limited [2016] FWCFB 7204 at [16]
56 (2006) 155 IR 22
57 Ibid 41
58 Decision [220]; Transcript [2690]
59 Decision [160]; Transcript [2660]-[2743]
60 Decision [220]
61 Transcript [2630]
62 Ibid [1665]-[1666]
63 Ibid [2701]-[2702], [2722]
64 Decision [220]-[229]; Transcript [2722]
65 Stead v State Government Insurance Commission (1986) 161 CLR 141, 147; Ajay Singh v MSS Security Pty Ltd [2015] FWCFB 393 at [16]
66 (1995) 185 CLR 410, 465; see also Australian Meat Holdings Pty Ltd v McLauchlan (1998) 84 IR 1
67 Larcombe, Kim v Bis Industries Limited [2017] FWCFB 4545 at [33]
68 Decision [252]