| [2023] FWC 121 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Kieren Michael Chalk
v
Ventia Australia Pty Ltd
(U2022/7847)
COMMISSIONER PLATT |
ADELAIDE, 17 JANUARY 2023 |
Application for an unfair dismissal remedy – breach of confidentiality – loss of trust and confidence – valid reasons found – dismissal not harsh, unjust or unreasonable – application dismissed.
[1] On 27 July 2022, Mr Kieran Chalk (Mr Chalk) made an application to the Fair Work Commission (Commission) under s.394 of the Fair Work Act 2009 (Cth) (the Act) for a remedy, alleging that he had been unfairly dismissed from his employment by Ventia Australia Pty Ltd (Ventia).
[2] On 3 August 2022, Ventia filed its Employer Response and raised a jurisdictional objection on the basis that Mr Chalk earned more than the high-income threshold and was not covered by an Award or an enterprise agreement, and therefore was not a person protected from unfair dismissal.
[3] On 7 September 2022, the matter was allocated to my Chambers and on 13 September 2022, a directions conference was held. Directions were issued for the filing of material in relation to the Respondent’s jurisdictional objection.
[4] On 17 September 2022, Ventia advised that it wished to withdraw its jurisdictional objection to the Application and requested that the matter be listed for hearing of the merits of the application. Ventia’s Group Legal Counsel (Employment) confirmed that the basis for the withdrawal of its jurisdictional objection was that Mr Chalk’s employment had been covered by the Professional Employees Award 2020 (Professionals Award). On 20 September 2022, I rescinded my directions in respect of the jurisdictional hearing and issued new directions in respect of the hearing of the merits of the application.
[5] Mr Chalk filed material in support of his application on 27 September 2022 on the basis that Ventia had accepted that he was protected from unfair dismissal.
[6] On 4 October 2022, the Respondent filed an outline of submissions and witness statements in relation to the matter. As part of its submissions, Ventia sought to reagitate the jurisdictional objection that it had previously withdrawn on 17 September 2022.
[7] I determined not the allow the jurisdictional concession to be withdrawn owing to the fact that the withdrawal of the jurisdictional objection was made by a legally qualified representative of Ventia, the representative had specified an appropriate factual basis to make this concession, and the late stage at which the concession was sought to be withdrawn.
[8] The directions required the parties to file and respond to submissions concerning representation by a lawyer or paid agent.
[9] Ventia sought to be represented on the basis of s.596(2)(a) of the Act, as they contended that representation would enable the matter to be dealt with more efficiently, taking into account the complexity of the matter. Ventia pointed to the extensive amount of material before the Commission and the issue of confidentiality obligations in commercial contracts as sources of complexity in the matter. Ventia also submitted that there was a somewhat acrimonious relationship between Mr Chalk and the employees of Ventia who would otherwise represent Ventia at the hearing, and that allowing Ventia to be represented by a lawyer at the hearing would lessen the complicating impact of any animosity.
[10] Mr Chalk objected to Ventia being granted permission to be represented on the basis that the matter was not overly complex, legal representation was not necessary to avoid any perceived hostility between the parties, Ventia was a large business with experienced legal counsel, and given Mr Chalk would be self-represented at the hearing, allowing the Respondent to be represented by a lawyer might provide Ventia with an unfair advantage.
[11] The following factors impacted my decision in respect of whether I should exercise my discretion to allow Ventia to be represented by a lawyer at the hearing:
• Objectively the matter involved relatively complex issues including the relationship between commercial contractual obligations and obligations of confidentiality.
• The relationship between Mr Chalk and Ventia had clearly deteriorated, and there was a sense of some animosity between the parties, including the employees of Ventia who would be required to conduct the hearing in the absence of representation.
[12] On 14 October 2022, my Chambers communicated with the parties advising that I had determined to grant permission for Ventia to be represented by a lawyer at the hearing. In order to ameliorate any unfairness to Mr Chalk as a result of this decision, I determined to conduct the hearing by way of determinative conference.
[13] A determinative conference was held, in person, on 27 and 28 October 2022. Mr Chalk represented himself at the hearing, and Ventia was represented by Mr Tim Lange (of Counsel).
[14] At the commencement of the hearing a confidentiality order pursuant to s.594 of the Act was made by consent of the parties in respect of the publication of the contents or any material that tended to identify the contents of a commercial contract between Ventia and its Client (who I have chosen not to name) for the provision of specified services (referred to as the ‘Services Agreement’). The order was made to protect the commercially sensitive contract which remains on foot.
[15] Ventia provides facility management services to a Client pursuant to the Services Agreement. Mr Chalk was employed by Ventia as Strategic Asset Manager and was a senior member of the team that managed that contract. Mr Chalk’s contract of employment contained general obligations in respect of his duties to Ventia, requirements prohibiting the disclosure of confidential information and Code of Conduct obligations.
[16] Mr Chalk had a personal relationship with Ms Kate Toner prior to her employment with Ventia on 3 November 2021. The nature of that relationship appears to have changed over the course of time. Ms Toner left the employ of Ventia in acrimonious circumstances on 19 January 2022. On Saturday 26 March 2022, Mr Chalk emailed Ms Toner a confidential version of the Services Agreement. 1 Whilst Ventia was not aware of this communication at the time of Mr Chalk’s dismissal, it contends this email was sent in breach of Mr Chalk’s confidentiality obligations and is a valid reason for dismissal. Mr Chalk contends he sent the email to Ms Toner’s email so that he could manipulate a graphic contained within the document.
[17] On 1 July 2022 Mr Chalk sent an email directly to Ventia’s Client concerning the operation of the Services Agreement. The email advised that certain contractor charge out rates were above the ceiling threshold contained in the Agreement, possibly in the order of $68K per month and the matter required further investigation. Mr Chalk contends that the Services Agreement required him to alert the Client of this issue. Ventia contends that the communication to the Client was not a requirement of the Services Agreement, required further investigation and was thus premature, embarrassed Ventia, and that this conduct was a breach of the obligations (express and implied) under Mr Chalk’s contract of employment. Ventia submitted that a hand written note made by Mr Chalk and left in his desk contradicts Mr Chalk’s explanation for the email to the Client.
[18] Ventia also asserts that Mr Chalk displayed a lack of truthfulness in relation to disclosures about his relationship with Ms Toner which was legitimately raised with him during his employment.
[19] Finally, Ventia submits that it lost trust and confidence in Mr Chalk’s ability to perform his role as a consequence of his actions.
[20] Mr Chalk and Ventia’s materials were collated into a court book which was distributed prior to the hearing. This court book was received into evidence, with appropriate weight being given to the received material after an assessment of its character (e.g. hearsay and/or opinion evidence), its relevance and its nature.
[21] Mr Chalk filed a witness statement 2, an outline of argument3, and a reply to Ventia’s submissions4. In so far as Mr Chalk’s submissions also contained relevant facts, the material has been received into evidence. Mr Chalk gave evidence on his own behalf and also called Ms Toner. A witness statement in respect of Ms Toner was not submitted however a photograph of some handwritten notes was tendered5. Both Mr Chalk and Ms Toner were cross examined.
[22] Ventia filed witness statements from Mr Steven Watts (Contract Manager, Service Delivery for the Services Agreement) 6 and Ms Janene Browning (People and Capability Manager).7 Both of these witnesses gave evidence and were cross-examined.
[23] The relevant evidence is summarised as follows:
• Mr Chalk has 15 years of experience in Asset Management and holds a Bachelor’s degree with Honours in Mechanical Engineering, a Master of Science in Advanced Materials, and a Philosophy Doctorate. 8 Mr Chalk asserts that he oversees formal training in commercial law conducted by a leading Adelaide Law firm.9
• Mr Chalk commenced employment with Ventia on 25 October 2021, in the role of Strategic Asset Manager. 10 Mr Chalk’s employment was governed by a written contract of employment, dated 23 September 2021 (the Contract of Employment) and the Professionals Award.11 The Contract of Employment at clause 2.3 required Mr Chalk to honestly and diligently serve the Company and use his best endeavours to promote its interests and welfare. Clause 22.1 required Mr Chalk not to disclose confidential information (as defined in clause 28.112) except in the proper performance of his responsibilities and duties (unless he had been authorised in writing). Clause 15 of the Contract of Employment required Mr Chalk to abide by Ventia’s Code of Conduct. Clause 22.3 of the Contract of Employment confirms that a breach of the confidentiality provision is misconduct and may lead to the termination of employment.
• Mr Chalk’s role as Strategic Asset Manager required him to plan and oversee the management and maintenance schedule of assets across the Services Agreement with responsibility for ‘data integrity management’ which included ‘Ensuring accuracy and integrity of all data.’ 13 Mr Chalk contended that ‘all data under the contract was managed and overseen by myself’.14 Mr Chalk asserts that the Contract required Ventia to ‘ensure that in performing the services, no part of the data is corrupted, deleted or subjected to unauthorised use and that no errors are introduced into the data.’.15
• Mr Chalk reported to Mr David Zensea (the Project Director for Ventia), his peers were the Contract Managers. 16
• Mr Chalk was provided with a copy of the Services Agreement on 26 October 2021. The Services Agreement contains confidential information as defined by clause 28.1 of Mr Chalk’s Contract of Employment.
• Mr L.V. [full name redacted] was the Client’s point of contact for Governance matters concerning the Services Agreement. 17
• Unbeknown to Ventia, on Saturday 26 March 2022, Mr Chalk emailed Ms Toner an unredacted confidential version of the Services Agreement. 18 Mr Chalk does not dispute that the Services Agreement was confidential but contends he sent it to Ms Toner to allow him to manipulate a graphic contained in the document on a Macintosh computer. Ventia did not become aware of this communication until after Mr Chalk’s dismissal.
• The Services Agreement contains a “ceiling rate threshold”, which effectively specifies the maximum hourly rate payable to subcontractors for maintenance work performed under the agreement. Certain subcontractors were not subject to the ceiling rate threshold for historical reasons. Mr Chalk may not have been aware of the historical arrangements.
• On or about 5 May 2022 Mr Chalk and Ms Toner were involved in the preparation of a document which (in part) discussed the Services Contract, Mr Chalk and the Client. This note was found in Mr Chalk’s desk after his dismissal. The detail of the note is discussed later in this decision. Ventia contend this note provides insight into Mr Chalk’s actions.
• On 5 May 2022 Ventia held a meeting with Mr Chalk to discuss concerns about his work performance. 19
• On or around 1 July 2022, Mr Chalk was involved in a meeting with Mr Mike Mundy (subcontractor of Ventia) and Mr Trevor White (General Manager of Reporting), who had conducted an analysis on the ceiling rates. The analysis indicated that Ventia may have been charging above the ceiling rates for some subcontractors.
• At 2.19pm on 1 July 2022, Mr Chalk sent the following email to Mr Watts:
“Hi Steve,
During the catch up on procurement this morning with Mike Mundy and Trevor White, Mike went through the analysis he has conducted on ceiling rates. Trevor White, David, and Scott Earl have all been provided with my Commercial Model and the Project Revenue Model previously.
It appears that numerous individual rates (on a subcontractor’s internal role basis) are above the ceiling threshold, to the tune of $68k per month on Breakdown Works if all were applied at the highest rates. Probably requires further investigation.
We also discussed the incentive model and achievement Ventia’s Objectives and ROI. Key points are:
• [proposed savings strategies - information redacted as commercially sensitive]
This closes the loop. Please circulate as required to ensure our ongoing viability AS A GROUP.
Kind regards,
Kieran Chalk”
(emphasis added).
• At 3.25pm on 1 July 2022, Mr Chalk forwarded the email extracted above to Mr Zensea and other members of the senior management team. Mr Chalk’s email also included the following message:
“Hi Guys
See below for your information, apologies for missing off distribution list I was in a rush as many concurrent activities on the go with some key data related deadlines today.
Hopefully Steve Watts has already circulated this as I requested. Scroll through e-mail chain for context. As mentioned below, please circulate as required to ensure our ongoing viability AS A GROUP.
Kind regards,
Kieran Chalk”
• At 5.17pm on 1 July 2022, Mr Chalk forwarded the email chain above to Mr V, the Asset Safety and Data Manager at the Client. Mr Chalk’s email also included the following message:
“Hi Guys
Please refer to the below FYI.
Kind regards,
Kieran Chalk”
• Despite using the expression “Hi Guys” at the commencement of the email, Mr Chalk confirmed under cross-examination that this email was only sent to Mr V.
• On or around 7 July 2022, Mr Lacar (from the Client) contacted Ms Tanya Fuller of Ventia and raised an issue that the Client had been notified that Ventia may be charging above the ceiling rates contained in the Services Agreement.
• Upon receipt of this information, Ventia enquired with the Client as to who had shared the information about subcontractor ceiling rates.
• The Client informed Ventia that they had found out the information via an email that had been sent by Mr Chalk to Mr V. No one else from Ventia had been aware that Mr Chalk had sent the email.
• At about 5pm on 12 July 2022, Mr Watts handed Mr Chalk a letter standing him down from his employment on full pay pending an investigation into the sharing of sensitive information with the Client as a result of the email sent to Mr V. 20
• At 5.12pm on 12 July 2022, the email sent from Mr Chalk’s email account to Mr V was deleted from Mr Chalk’s ‘sent items’. Mr Chalk denies doing this.
• On 13 July 2022, Mr Watts sent Mr Chalk a letter detailing the allegations against him. The letter contained the allegation that the ceiling rates information forwarded to Mr V by email contained confidential information and contended that this was a breach of Mr Chalk’s confidentiality obligations.
• On 15 July 2022, a meeting was held between Mr Watts and Mr Chalk in order to receive his verbal response to the allegations. Ms Monica Singh (People and Culture Advisor at Ventia) also attended the meeting. Ventia kept a record of the meeting 21. Mr Chalk contended that he had only sent an FYI to Mr V, and that he was responsible for data integrity, and this was a data integrity issue and not a confidentiality issue. As to the motivation for his actions, Mr Chalk said he was simply keeping the Client informed.
• On 18 July 2022, at 8.55am, Mr Chalk provided a written response to the allegations. Mr Chalk asserted at both the meeting on 15 July 2022 and throughout his written response that it was his obligation under the Services Agreement to share the information he had with the Client. Mr Chalk maintained that he had not shared any information that was confidential, and that he would have been in breach of the Services Agreement if he had not shared the information with the Client. Accordingly, Mr Chalk maintained that no misconduct had occurred. Mr Chalk said there needed to be more clarity as to confidential information. Mr Watts raised the issue of loss of trust.
• On 18 July 2022, at 11.33am, Ms Browning (People and Capability Manager) sought approval to conduct a search of Mr Chalk’s Ventia email account to check if any other confidential information had been sent outside of Ventia.
• On 18 July 2022, at 11.41am, Ms Hanli Pretorius (Ventia General Manager of People & Culture) endorsed the recommendation to terminate Mr Chalk’s employment.
• At 11.43am on 18 July 2022 Ms Browning’s request to access Mr Chalk’s Ventia email account was approved.
• On 21 July 2022, a meeting occurred between Mr Chalk and Mr Watts. Mr Chalk was advised that his employment was being terminated and he would be paid four weeks pay in lieu of notice. A termination letter 22 was sent to him following the meeting.
• About two weeks after the dismissal, Mr Watts was cleaning out Mr Chalk’s desk when he found a handwritten document which appeared to be in Mr Chalk’s handwriting 23. The relevant portion of the document is extracted below (all of the redacted portions contained an abbreviation for the Client except for the bottom redaction which refers to the abbreviation for the Services Agreement)
•
• Ventia suggest that this document contains a plan for Mr Chalk to extricate his role from Ventia and install himself in a similar role with the Client. Mr Chalk stated that the document was prepared in a discussion with Ms Toner.‘She [Ms Toner] wrote it in her handwriting. To humour her and to try and get her to calm down, I copied it out….’ Mr Chalk contended that he transcribed what Ms Toner wrote, word for word. Ms Toner subsequently gave evidence on this point and tendered a photograph that was taken on 8 May 2022 of the ‘source document’. 24 Ms Toner asserted that this document was prepared by her to assist Mr Chalk in a meeting about his work performance.
• A review of Mr Chalk’s Ventia email account revealed an email sent by Mr Chalk to Ms Toner, then an ex-employee of Ventia, on 26 March 2022 at 10.40pm (the March Email). The March Email contained an unredacted, confidential version of the Services Agreement.
• In addition, Ms Browning found correspondence between Mr Chalk and Ms Toner which suggested to Ms Browning that the two were in a romantic relationship. Ventia harboured concerns that Mr Chalk had advocated for Ms Toner’s engagement by Ventia without disclosing the true nature of their relationship. I accept that Mr Chalk’s support of the employment of Ms Toner genuinely gave Ventia a basis to enquire as to whether he had a conflict of interest by way of his relationship. The topic was raised with Mr Chalk during his employment. Communications between Mr Chalk and Ms Toner revealed during Ms Browning’s search post dismissal fuelled further concerns. Whilst I accept that the relationship between Mr Chalk and Ms Toner (based on their evidence) is somewhat complex, and the evidence received appears to be inconsistent, I have not been persuaded that Mr Chalk’s representations about his relationship with Ms Toner are sufficient to ground a valid reason for dismissal. The inconsistent evidence is however relevant as to the credibility of Ms Toner and Mr Chalk.
• Mr Watts gave evidence that had Mr Chalk spoken about his concerns with the charge-out rates he would have informed him that there was agreement between Ventia and the Client that some Contractors had permission to use ‘grandfathered’ rates which could result in the cap being exceeded but this was not in breach of the Service Agreement. 25
[24] Two key issues to be determined in this matter are:
• Whether Mr Chalk’s email communication to Mr V was required to be sent under the terms of the Services Agreement, and if the communication was appropriate in the circumstances for a person of Mr Chalk’s experience and seniority.
• The emailing of a copy of the Services Agreement to Ms Toner’s email account whilst she was not an employee and the explanation given by Mr Chalk.
[25] Mr Chalk received information from his subordinates about the subcontractor charge out rates being applied under the Services Agreement.
[26] Mr Chalk first sent an email about his concerns relating to the subcontractor charge out rate issue to Mr Watts at 2.19pm on 1 July 2022. This email is reproduced above. Mr Chalk suggested the matter required further investigation. No reply was received.
[27] A little over an hour later (and before any reply from the original email was received), Mr Chalk emailed Mr Zensea and other members of the senior management team. No specific request for action was made.
[28] Just under three hours after sending the first email (and without any reply) Mr Chalk forwarded that email to Mr V at 5.19pm on 1 July 2022. Mr Chalk contended he forwarded the email as ‘I received no response from anyone [from his 2.19pm email] and I was conscious that it was approaching the weekend and we have the requirement to notify them of a defect as soon as practicable. Also, the contractor requirement to be open, honest and transparent with the client, and have a collaborative relationship as I was directed to develop’. 26
[29] Mr Chalk held the view that the subcontractor rates were in excess of that permitted by the Services Agreement 27 and subject to confirmation the rates above the threshold could have been as high as $68K per month.28 Mr Chalk’s concern was ‘that there was an issue with the integrity of the data and they could potentially be impacting the participating agencies we serve on behalf of the Client.’29
[30] Ventia contended that reference to the ceiling rates in the email to Mr V was confidential information that should not have been disclosed by Mr Chalk and further that Mr Chalk should have consulted Mr Watts and/or Mr Zensea prior to sending the email. If Mr Chalk had consulted Mr Watts he could have been advised there was no ceiling rate issue as there were ‘grand fathering’ arrangements in place, with the Client’s knowledge.
[31] Mr Chalk justified the sending of the email to Mr V as ‘it is a normal part of my roles and duties as they have been assigned to me by the project director’. 30
[32] Mr Chalk accepted that the potential overcharging may not have occurred at all and required further investigation. 31
[33] Mr Chalk acknowledged that he did not explicitly raise with his colleagues his intention to send the email to Mr V and accepted ‘that my biggest failure was probably not touching base with someone beforehand.’ 32 If he had allowed sufficient time for a response to be received or took positive steps to consult with his superiors prior to sending the email the entire circumstance may have been avoided.
[34] Mr Chalk implied that it was a product of him being tired after working 16 hour days. Mr Chalk later suggested the email was sent directly for security reasons. 33 I note that neither of these explanations were proffered in Mr Chalk’s show cause response. This is a significant failing for a person of Mr Chalk’s experience and seniority.
[35] Mr Chalk was unable to adequately explain why he did not advise Mr Watts or Mr Zensea of his intention to send the 5.19pm communication directly to the Client. Mr Chalk determined not to copy this email to members of the Ventia Team including Mr Watts or Mr Zensea. In cross examination Mr Chalk accepted this was a mistake. 34
[36] The email to Mr V was deleted from Mr Chalk’s email account shortly after Mr Chalk was given a stand down notice on 12 July 2022. Mr Chalk denied deleting the email. 35 I do not accept Mr Chalk’s evidence is this regard.
[37] I accept that the information sent to Mr V was not in the public domain and was confidential to Ventia based on the definition of confidential information contained in Clause 28 of his Contract of Employment. Mr Chalk did not contend he was a ‘whistle blower.’
[38] I am not persuaded that the information about the charge-out rates that Mr Chalk received amounted to a ‘data breach’.
[39] Mr Chalk’s suggestion that he was required to send the email because of ‘data integrity issues’ appears to seek to avoid or reduce his responsibility for his conduct. Whilst Mr Chalk reports feeling stressed this is not a satisfactory explanation for his conduct. Mr Chalk had a variety of options available to him other than to raise what at the time was merely a possibility.
[40] The disclosure caused unnecessary concern to the Client. Ventia was considerably embarrassed by the disclosure.
[41] It appears to be that Mr Chalk’s conduct was in breach of both his confidentiality obligation and his duties owed to Ventia. His actions in not further investigating the matter or consulting with Mr Watts and/or Mr Zensea were ill-considered for a person of his experience and seniority.
[42] Mr Chalk’s action and his subsequent responses provided a proper basis for Ventia to lose trust and confidence in his ability to adequately perform his role.
[43] The note found by Mr Watts in Mr Chalk’s desk post dismissal has been reproduced above. 36
[44] The references to KC in the note are references to Mr Chalk. I have redacted reference to the Client. The note appears to contemplate a strategy to persuade the Client that Mr Chalk is the only person who can perform the role, that there are no other options, and the performance of Mr Chalk’s role is being obstructed by internal politics. The solution envisaged by the note is for the Client to extract the role from Ventia and install Mr Chalk as the dedicated liaison between the Client and Ventia.
[45] Mr Chalk accepted the document was written by him. Mr Chalk advised that this document was prepared some months prior to the email to Mr V. Initially Mr Chalk contended that Ms Toner had dictated the content and he had simply written it down to humour her and calm her down so as to reduce a stressful situation at home. After being cross examined on the wording of the note, Mr Chalk accepted that at least some of the content was authored by him. Mr Chalk accepted that his evidence as to the creation of this document had varied and that suggested that it was as a result of a memory failure. Ms Toner suggested the document was created to assist Mr Chalk at a meeting with Ventia concerning his performance. The two accounts of how the document were created ware incompatible. Mr Chalk’s varying accounts as to the creation of this document adversely impact on his credibility. 37
[46] I do not accept Mr Chalk’s explanation of how or why this document was created. The strategy contained in the note appears to be the more likely of the two explanations proffered to explain why the email was sent to Mr V.
[47] There is no dispute the email was sent to Ms Toners personal email address by Mr Chalk at a time when Ms Toner was not an employee of Ventia. Mr Chalk does not dispute the Services Agreement was a confidential document. This is a clear breach of Mr Chalk’s confidentially obligations.
[48] Mr Chalk’s explanation for his conduct was that Mr Watts required an image to be extracted out of the Services Agreement. The request was made on a Friday and it was needed by the Monday morning. 38 Mr Chalk decided that it was best done on a Macintosh Computer. Ms Toner used a Macintosh Computer and Mr Chalk determined to email the document to Ms Toner’s email account.
[49] Mr Chalk states that he accessed the email on Ms Toner’s Macintosh Computer on the Saturday, opened the file, copied the image and deleted the document.
[50] Mr Chalk was unable to satisfactorily explain why the file could not be manipulated using Ventia’s equipment (with IT support as required), or why the email could not have been sent to an email account controlled by him (such as a Ventia account and accessed via webmail) instead of Ms Toner’s account. These options would have enabled the task to be completed without breaching Mr Chalk’s confidentiality obligations. Mr Chalk contends it ‘was a circumstance of expedience.’ 39 Mr Chalk belatedly accepted he should not have taken this course of action before then blaming it on workload issues.40
[51] Curiously Mr Chalk contended that he would not be in breach of his confidentiality obligations as long as appropriate controls and actions were taken by him to ensure that the material does not get misused or fall into the wrong hands. 41 This approach appears significantly more relaxed when compared to Mr Chalk’s more rigorous approach concerning the need to communicate perceived data integrity issues.’
[52] Mr Chalk’s explanation as to why he breached his confidentiality obligations was unconvincing.
[53] Mr Chalk submitted that his dismissal was unfair because:
• There was no breach of his confidentiality obligations.
• A data integrity issue existed and that as a result of him having overall responsibility for data integrity under the Services Agreement, he was obliged to raise the issue with the Client and send the email to Mr V within 2 business days.
• His conduct in respect of sending the Services Agreement to Ms Toner was necessary in order to extract an image from the document.
• The dismissal was unreasonable as there was a lack of procedural fairness (referring to compliance with Ventia’s Fair Play Guide).
• The dismissal was harsh due to the serious personal, professional, and economic ramifications.
[54] Mr Chalk denied that the hand written note was evidence of motive and that this note was simply a transcription of the views of Ms Toner.
[55] Ventia submitted that Mr Chalk’s conduct in sending the email to Mr V was a breach of his confidentiality requirements and the express and implied duties under his contract of employment. Ventia contended that Mr Chalk was under no obligation to send the email. Ventia suggested that the handwritten note found post dismissal provided evidence of a potential motive for the sending of the email.
[56] Ventia also submitted that they lost trust and confidence in Mr Chalk prior to his dismissal.
[57] Ventia submitted that Mr Chalk’s decision to send the copy of the Services Agreement to Ms Toner by email was also a breach of his confidentiality obligations.
[58] Ventia asserts that it advised Mr Chalk of the first reason for the dismissal and gave him an opportunity to respond. The issue of trust and confidence was also discussed in the disciplinary meeting on 15 July 2022. Ventia was unaware of the communication to Ms Toner at the time of the dismissal.
[59] Ventia contend that Mr Chalk did not seek a support person.
[60] Ventia accept they are not a small business and have an internal human resources function.
[61] Ventia submitted that the Mr Chalk’s email to Ms Toner is also a factor that should be taken into account in its losing trust and confidence in Mr Chalk.
[62] Ventia contend that an adverse credit finding should be made against Mr Chalk.
[63] In this matter there is a need to evaluate the credibility of the explanations provided for Mr Chalk’s actions.
[64] The hearing was held in person and I had an opportunity to evaluate the manner in which each witness gave their evidence.
[65] Mr Chalk was an unconvincing witness. He did not listen to the questions, on at least one occasion he was flippant, he was repeatedly evasive despite warnings to answer the questions, and his evidence varied. It appeared to me Mr Chalk was adjusting his evidence to suit the circumstances in the hope it would assist his case.
[66] His evidence on the creation of the hand-written document found on his desk did not match that subsequently given by Ms Toner.
[67] Ms Toner was also an unconvincing witness. Whilst I accept that she remains aggrieved by Ventia’s decision to end her employment, she was evasive and acted as an advocate against Ventia and in support of Mr Chalk, as opposed to providing an objective account of what she knew about the matter.
[68] Mr Watts was a good witness who provided a consistent and objective account of what he believed occurred. I have no reservations in accepting the evidence of Mr Watts.
[69] Ms Browning also provided an objective account and made appropriate concessions during her evidence. I also have no reservations in accepting the evidence of Ms Browning.
[70] There was no dispute and I find that Mr Chalk’s employment with Ventia was terminated at the initiative of the employer.
[71] I am therefore satisfied that Mr Chalk has been dismissed within the meaning of s.385 of the Act.
[72] Under s.396 of the Act, the Commission is obliged to decide the following matters before considering the merits of the application:
(a) whether the application was made within the period required in subsection 394(2);
(b) whether the person was protected from unfair dismissal;
(c) whether the dismissal was consistent with the Small Business Fair Dismissal Code;
(d) whether the dismissal was a case of genuine redundancy.
[73] Section 394(2) requires an application to be made within 21 days after the dismissal took effect.
[74] It is not disputed, and I find that Mr Chalk was dismissed from his employment on 21 July 2022 and made the application on 27 July 2022. I am therefore satisfied that the application was made within the period required in subsection 394(2).
[75] Section 382 details when a person is protected from unfair dismissal.
Minimum employment period
[76] It was not in dispute, and I find that Ventia is not a small business employer, having 15 or more employees at the relevant time.
[77] Mr Chalk was employed by Ventia for a period of approximately 9 months.
[78] I am therefore satisfied that, at the time of dismissal, Mr Chalk was an employee who had completed a period of employment with Ventia of at least the minimum employment period.
[79] As discussed above, Ventia accepted that Mr Chalk’s employment was covered by the Professional Employees Award 2020 on 17 September 2022. I am satisfied that the Professional Employees Award 2020 covered Mr Chalk at the time of his dismissal and thus Mr Chalk’s annual rate of earnings (which was in excess of the high income threshold) has no consequence.
[80] I am satisfied that, at the time of dismissal, Mr Chalk was a person protected from unfair dismissal.
[81] Section 385 of the Act provides that a person has been unfairly dismissed if the Commission is satisfied that:
(a) the person has been dismissed; and
(b) the dismissal was harsh, unjust or unreasonable; and
(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and
(d) the dismissal was not a case of genuine redundancy.
[82] There was no dispute that Mr Chalk had been dismissed, and it was not contended that the dismissal was a case of genuine redundancy, or that the Small Business Fair Dismissal Code had application. The only matter in dispute is whether the dismissal was harsh, unjust or unreasonable within the meaning of s.387 of the Act.
[83] Section 387 of the Act provides that, in considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the Commission must take into account:
(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and
(b) whether the person was notified of that reason; and
(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and
(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and
(e) if the dismissal related to unsatisfactory performance by the person – whether the person had been warned about that unsatisfactory performance before the dismissal; and
(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(h) any other matters that the FWC considers relevant.
[84] I am required to consider each of these criteria, to the extent they are relevant to the factual circumstances before me. 42
[85] I set out my consideration of each below referring to my factual findings above.
[86] In order to be a valid reason, the reason for the dismissal should be “sound, defensible or well founded” 43 and should not be “capricious, fanciful, spiteful or prejudiced.”44 However, the Commission will not stand in the shoes of the employer and determine what the Commission would do if it was in the position of the employer.45
[87] Where a dismissal relates to an employee’s conduct, the Commission must be satisfied that the conduct occurred and justified termination.46 “The question of whether the alleged conduct took place and what it involved is to be determined by the Commission on the basis of the evidence in the proceedings before it. The test is not whether the employer believed, on reasonable grounds after sufficient enquiry, that the employee was guilty of the conduct which resulted in termination.” 47
[88] On this occasion, it was only after the dismissal of Mr Chalk that Ventia became aware of the extent of Mr Chalk’s misconduct. Nevertheless, it is open to Ventia to rely on the full extent of Mr Chalk’s misconduct as a valid reason for the dismissal. As stated by the High Court, “if there were, in fact, any circumstances in existence at the time of the termination of the agreement which could have justified the respondent in so terminating it, then it may justify the termination by subsequent proof of those circumstances…”48
[89] Having regard to the evidence before me I find that there was a valid reason for the dismissal related to Mr Chalk’s conduct in sending the 1 July 2022 email to Mr V which was both a breach of his confidentiality obligation and poor exercise of discretion of an experienced and senior employee who failed to consult with his superiors about a matter which he himself recognised required further investigation.
[90] There is also a valid reason in respect of the breach of confidentiality in respect of sending the Services Agreement to Ms Toner on 26 March 2022.
[91] I accept that as a result of Mr Watts’ experiences with Mr Chalk since April 2022 together with Mr Chalk sending the email to Mr V, 49 Mr Watts lost trust and confidence in Mr Chalk’s ability to perform his role and this is also a valid reason for dismissal.
[92] Notification of a valid reason for termination must be given to an employee protected from unfair dismissal before the decision is made to terminate their employment, 50 and in explicit51 and plain and clear terms.52
[93] I accept that Ventia advised Mr Chalk of the allegations in respect of his conduct in sending the email to Mr V on 1 July 2022 prior to the decision to dismiss him.
[94] The issue of the loss of trust and confidence was raised with Mr Chalk at his disciplinary interview on 15 July 2022.
[95] Mr Chalk was not advised of the allegation that he sent a copy of the Services Agreement in breach of his confidentiality obligation on 26 March 2022 to Ms Toner prior to the decision to dismiss, as the Respondent was not aware of this communication at the time.
[96] An employee protected from unfair dismissal should be provided with an opportunity to respond to any reason for their dismissal relating to their conduct or capacity. An opportunity to respond is to be provided before a decision is taken to terminate the employee’s employment. 53
[97] The opportunity to respond does not require formality and this factor is to be applied in a common sense way to ensure the employee is treated fairly. 54 Where the employee is aware of the precise nature of the employer’s 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.55
[98] I am satisfied that Mr Chalk was given an opportunity to respond to the allegations is respect of his conduct in sending the email to Mr V on 1 July 2022 and Ventia’s concerns regarding the loss of trust and confidence
[99] I accept that Mr Watts considered Mr Chalk’s response to the allegations against him.
[100] Mr Chalk was not given an opportunity to respond to the allegation that he sent a copy of the Services Agreement in breach of his confidentiality obligation on 26 March 2022 to Ms Toner. The reason for this failure was that the Respondent was unaware of this communication prior to Mr Chalk’s dismissal. In my view Ventia has adequately explained its failure in putting this matter to Mr Chalk prior to his dismissal.
[101] Where an employee protected from unfair dismissal has requested a support person be present to assist in discussions relating to the dismissal, an employer should not unreasonably refuse that person being present.
[102] There is no positive obligation on an employer to offer an employee the opportunity to have a support person:
“This factor will only be a relevant consideration when an employee asks to have a support person present in a discussion relating to dismissal and the employer unreasonably refuses. It does not impose a positive obligation on employers to offer an employee the opportunity to have a support person present when they are considering dismissing them.”56
[103] Mr Chalk did not seek a support person be present. 57
[104] I find that the Ventia did not unreasonably refuse to allow Mr Chalk to have a support person present at discussions relating to the dismissal.
[105] As the dismissal did not relate to unsatisfactory performance, this factor is not relevant.
[106] Ventia is a large business and did not submit that the size of its enterprise was likely to impact on the procedures followed in effecting the dismissal and accordingly this consideration is not a determining factor.
[107] The Respondent is a large business with in-house human resource specialists and accordingly this consideration is not a determining factor.
[108] Section 387(h) of the Act requires the Commission to take into account any other matters that the Commission considers relevant.
[109] Mr Chalk contended that the Respondent did not comply with its Fair Play Guide as to procedural fairness and outcome. 58 I note that the Fair Play Guide is simply a guide and appears to exclude matters that are the subject of confidentiality agreements.59 I was unable to determine any breaches of the Fair Play Guide concerning procedural fairness. In respect of outcomes Appendix 1 relies on a subjective determination as to the nature of the behaviour and its consequences. It is clear to me that the perceptions of Mr Chalk and the Respondent on these topics differ considerably.
[110] Mr Chalk contended that the Services Agreement required the Client to approve changes to Ventia’s key personnel and thus Mr Chalk’s dismissal. 60 If there was a breach of the Services Agreement this would be a matter for the Client to pursue. The connection between this requirement and the s.387 criteria appears remote.
[111] Mr Chalk submitted that he was under a lot of pressure in the work environment. This must be weighed against Mr Chalk’s experience and the seniority of Mr Chalk’s role. In my view Mr Chalk’s conduct is not explained by the suggestion he was over worked.
[112] Mr Chalk submitted that his dismissal resulted in significant personal, professional, and economic ramifications. I do not doubt this.
[113] The degree of seriousness of the misconduct is a factor to be considered in determining whether “dismissal was a proportionate response to the conduct in question.”61
[114] Mr Chalk was a highly qualified, well experienced employee who held a senior role with Ventia. The conduct that I have found he engaged in was not inadvertent. Mr Chalk did not display any remorse for his conduct in sending the email to Mr V prior to the dismissal. That conduct clearly resulted in embarrassment for Ventia, and represented a significant breach of Mr Chalk’s employment obligations. Mr Chalk’s explanation for sending the confidential email to Ms Toner does not excuse the conduct. Finally, I accept Ventia’s basis for the loss of trust and confidence in Mr Chalk.
[115] The confidentiality provision in Mr Chalk’s Contract of Employment expressly provided that a breach will be regarded as misconduct that may attract termination without notice. Despite this provision I note that Mr Chalk was paid notice. I all the circumstances I do not believe that the sanction imposed was out of proportion to Mr Chalk’s conduct.
[116] I have made findings in relation to each matter specified in s.387 as relevant.
[117] I must consider and give due weight to each as a fundamental element in determining whether the termination was harsh, unjust or unreasonable. 62
[118] Having considered each of the matters specified in s.387 of the Act, I am satisfied that the dismissal of Mr Chalk was not harsh, unjust or unreasonable.
[119] Not being satisfied that the dismissal was harsh, unjust or unreasonable, I am not satisfied that Mr Chalk was unfairly dismissed within the meaning of s.385 of the Act. Mr Chalk’s application is therefore dismissed. An order to that effect will be issued separately.
COMMISSIONER
Appearances:
K Chalk, the Applicant.
T Lange for the Respondent.
Hearing details:
2022.
Adelaide:
27 and 28 October
Printed by authority of the Commonwealth Government Printer
<PR749709>
1 Page 826 of the Court Book
2 Exhibit A1 (including attachments)
3 Exhibit A3
4 Exhibit A2
5 Exhibit A4
6 Exhibit R1
7 Exhibit R7
8 PN83
9 PN84
10 PN87
11 Commences at page 732 of the Court Book
12 See page 738 of the Court Book
13 PN94
14 PN140
15 PN182
16 PN121
17 PN127
18 Page 826 of the Court Book
19 See letter dated 28 April 2022 and 4 July 2022 – Pages 746-750 of the Court Book
20 Exhibit R1, SMW13. Page 768 of the Court Book
21 See pages 770 -779 of the Court Book
22 Exhibit R1, page 781 of the Court Book
23 See page 785 of the Court Book
24 Exhibit A4
25 PN1371-1383
26 PN279
27 PN213
28 PN216
29 PN218
30 PN199
31 PN284
32 PN281
33 PN565
34 PN571
35 PN475-483
36 Exhibit R8, Pages 783-786 of the Court book
37 PN600-634, PN646-679
38 PN324
39 PN327
40 PN329-331
41 PN328
42 Sayer v Melsteel Pty Ltd [2011] FWAFB 7498, [14]; Smith v Moore Paragon Australia Ltd PR915674 (AIRCFB, Ross VP, Lacy SDP, Simmonds C, 21 March 2002), [69].
43 Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371, 373.
44 Ibid.
45 Walton v Mermaid Dry Cleaners Pty Ltd (1996) 142 ALR 681, 685.
46 Edwards v Justice Giudice [1999] FCA 1836, [7].
47 King v Freshmore (Vic) Pty Ltd Print S4213 (AIRCFB, Ross VP, Williams SDP, Hingley C, 17 March 2000), [23]-[24].
48 Shepherd v Felt & Textiles of Australia Ltd [1931] HCA 21, per Starke J.
49 PN1275-1284
50 Crozier v Palazzo Corporation Pty Ltd (2000) 98 IR 137, 151.
51 Previsic v Australian Quarantine Inspection Services Print Q3730 (AIRC, Holmes C, 6 October 1998).
52 Ibid.
53 Crozier v Palazzo Corporation Pty Ltd t/a Noble Park Storage and Transport Print S5897 (AIRCFB, Ross VP, Acton SDP, Cribb C, 11 May 2000), [75].
54 RMIT v Asher (2010) 194 IR 1, 14-15.
55 Gibson v Bosmac Pty Ltd (1995) 60 IR 1, 7.
56 Explanatory Memorandum, Fair Work Bill 2008 (Cth), [1542].
57 PN354
58 Page 71-74 of the Court Book
59 Clause 2 of the Fair Play Guide at page 71 of the Court Book.
60 PN357
61 Gelagotis v Esso Australia Pty Ltd t/a Esso [2018] FWCFB 6092, [117].
62 ALH Group Pty Ltd t/a The Royal Exchange Hotel v Mulhall (2002) 117 IR 357, [51]. See also Smith v Moore Paragon Australia Ltd PR915674 (AIRCFB, Ross VP, Lacy SDP, Simmonds C, 21 March 2002), [92]; Edwards v Justice Giudice [1999] FCA 1836, [6]–[7].