[2011] FWAFB 1166 |
FAIR WORK AUSTRALIA |
DECISION |
Fair Work Act 2009
s.604 - Appeal of decisions
Food, beverages and tobacco manufacturing industry | |
VICE PRESIDENT WATSON |
SYDNEY, 2 MARCH 2011 |
Appeal against decision 2010 FWA 8727 of Commissioner Cargill at Sydney on 15 November 2010 in matter number U2010/9543, Decision 503822; Order 503823 - appeal in relation to unfair dismissal application - discretionary decision - permission to appeal under s400 - significant error of fact - public interest test - disciplinary action/termination in relation to safety breach - enforcement of safe working practices - reinstatement following safety breach.
Introduction
[1] This decision concerns an application for permission to appeal against the decision of Commissioner Cargill dated 15 November 2010 in relation to an unfair dismissal application under s394 of the Fair Work Act 2009 (the Act) by Mr Kasian Wililo regarding the termination of his employment by Parmalat Food Products Pty Ltd (Parmalat). The Commissioner found the termination to be harsh and ordered reinstatement.
[2] The Appeal was heard on 22 February 2011. Mr I. Latham of counsel represented Parmalat. Mr O. Fagir of the Transport Workers Union of Australia represented Mr Wililo.
Nature of the Appeal
[3] An appeal under s604 of the Act in a matter of this nature is determined by reference to the provisions of s400 of the Act. Section 400 provides:
(1) Despite subsection 604(2), FWA must not grant permission to appeal from a decision made by FWA under this Part unless FWA considers that it is in the public interest to do so.
(2) Despite subsection 604(1), an appeal from a decision made by FWA 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.”
[4] A Full Bench in GlaxoSmithKline Australia Pty Ltd v Makin 1 considered the impact of s400 on the approach to granting permission to appeal. It said:
“[26] Appeals have lain on the ground that it is in the public interest that leave should be granted in the predecessors to the Act for decades. It has not been considered useful or appropriate to define the concept in other than the most general terms and we do not intend to do so. The expression ‘in the public interest’, when used in a statute, classically imports a discretionary value judgment to be made to be made by reference to undefined factual matters, confined only by the objects of the legislation in question. [Comalco v O’Connor (1995) 131 AR 657 at p.681 per Wilcox CJ & Keely J, citing O’Sullivan v Farrer (1989) 168 CLR 210]
[27] Although 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, it seems to us that none of those elements is present in this case.”
[5] The decision in this matter is properly viewed as a discretionary decision 2. The appeal is therefore to be considered in accordance with the principles of House v R3. Those principles are expressed in that decision as follows [at 504-505]:
“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.”
[6] Section 400(2) modifies the House v R principles by limiting any review based on a mistake of fact to a significant error of fact. Section 400 clearly evinces an intention of the legislature that appeals in unfair dismissal matters are more limited than in other matters under the Act.
The Decision Under Appeal
[7] The Commissioner conveniently set out Mr Wililo’s employment circumstances in paragraphs [7-12] of her decision. She said:
“[7] The applicant commenced employment with a predecessor of the respondent on 13 or 14 May 2008. The various corporate arrangements which led to the applicant, and other employees, being employed by Parmalat in July 2009 are set out in Exhibits Respondent 1 and 2.
[8] The applicant is a licensed forklift operator and, at the time of relevant events, including his dismissal, he was employed as a Level 3 Operator under the applicable enterprise agreement. The applicant worked night shift at the respondent’s Manufacturing and Distribution Centre at Lidcombe.
[9] Just prior to the time that the applicant commenced employment with Parmalat he was provided with a number of documents. These included a Safety Booklet, Attachment AC6 to Exhibit Respondent 1. The final page of the Booklet contains an acknowledgement signed by the applicant that working in a safe manner and adhering to safety policies and practices was a condition of his employment. He also undertook to immediately report any safety incident or issue that occurred at work.
[10] During his period of employment with Parmalat and its predecessors the applicant was counselled on several occasions and, in February 2009, received a first written warning for the use of inappropriate language / behaviour. The details of these disciplinary incidents are set out in paragraphs 14 to 18 of Exhibit Respondent 2.
[11] The applicant received a special “Pauls Award” in appreciation of his work over the Easter long weekend in 2010, Annexure KW3 to Exhibit Applicant 2.
[12] The incident which led to the termination of the applicant’s employment took place during the night shift on 7/8 May 2010. The applicant began his shift at 10pm and was due to finish at 6am. His evidence is that Friday nights were always busy. This was such a shift.”
[8] The termination arose from an investigation by the Company into an alleged breach of safety while driving a forklift. Mr Wililo was dismissed by way of a letter dated 31 May 2010. That letter was in the following terms:
“[Titled] Confirmation of Termination of Employment
On 8 May 2010, it was reported that you engaged in an unsafe act by placing your arms, head and shoulders underneath an unstable and elevated load in the Lidcombe Distribution Centre.
Some initial investigation was carried out and a formal investigation followed due to the seriousness of the alleged safety breach.
After thorough investigation, in relation to the safety breach, your behaviour was deemed to be grossly negligent, dangerous and you could have been severely injured or killed. This in itself is serious enough to warrant terminating your employment. However, your conduct during the investigation was most disappointing for the company.
Your responses to reasonable questioning about what had happened at the time of the safety breach were inconsistent to what was presented to the company by witnesses during the investigation. You had sufficient time to recall the events and were represented and supported during the process.
The company has thoroughly examined all aspects of the safety breach and have determined that you carried out a very unsafe act. We are most disappointed in the statements received from you during the investigation. The employment relationship is based on trust and your conduct in both the safety breach and the investigation that followed have eroded that trust. We have taken the decision today to terminate your employment effective immediately.
Any monies owing to you will be paid into your nominated bank account as soon as possible.
Yours sincerely,
Jude Lowe
NSW Warehouse and Distribution Manager,
Parmalat Food Products”
[9] The Commissioner considered the evidence before her in relation to each of the factors in s387 of the Act. Her conclusions on whether a valid reason existed for the termination was:
“[121] I am satisfied that the applicant’s actions in raising the tines of the forklift whilst they were not properly engaged and placing his hand and part of his arm under the elevated load cumulatively amount to a valid reason for the termination of his employment. I am also satisfied that the applicant’s actions amount to serious misconduct within the definition set out in Regulation 1.07 of the Regulations. The applicant’s actions caused serious and imminent risk to his own health and safety if not to that of others.”
[10] The Commissioner then considered the procedural fairness considerations and concluded:
“[122] I now turn to consider what might be termed the “procedural fairness” factors in section 387, paragraphs (b), (c) and (d). The applicant was notified of the reasons for his dismissal and he was given an opportunity to respond. He availed himself of that opportunity and responded both orally and in writing. The applicant had a support person with him at each of the interviews during the investigation process and was accompanied by two TWU Organisers at the meeting when he was informed of his dismissal.”
[11] As to paragraphs (e), (f) and (g) the Commissioner said:
“[123] Paragraph (e) of section 387 is not relevant as the dismissal was not related to the applicant’s performance but to his conduct. I have had regard to paragraphs (f) and (g). Whilst there was no evidence as to the number of employees, the respondent is a sizeable enterprise. Mr Cuttell’s presence demonstrates that it has dedicated human resource management specialists. I am satisfied that these factors had a positive impact on the procedures which were followed in effecting the applicant’s dismissal.”
[12] The Commissioner turned to consider other relevant matters. She said:
“[124] There are several matters which I consider to be relevant under paragraph (h) of the section. The first is the length of the applicant’s employment and his disciplinary history during that period.
[125] The second matter of relevance is the respondent’s failure to have shown the CCTV footage to the applicant during the investigation process. I accept Ms Lowe’s evidence that, in her mind it was not the crux of the issue, nevertheless, in part it caused her to conclude that the applicant was lying about his actions. It would have been fairer to have shown the footage to the applicant to have obtained his response as to what it revealed. Such a response may even have caused Ms Lowe to rethink some of her conclusions.
[126] The third matter of relevance is that, although I have found that the applicant’s actions amounted to serious misconduct, I am satisfied that his actions were not wilful or negligent but rather the result of carelessness and a failure to properly appreciate the consequences.
[127] The fourth matter is that, although the respondent has a commendable focus on safety, it does not have anything akin to a zero tolerance policy. The evidence concerning the forklift incident which occurred after the applicant’s dismissal demonstrates that the respondent reasonably considers each matter in light of the particular surrounding circumstances. It would appear that in the applicant’s case, judgements were clouded by a belief that he was lying. I have found that this was not the case.”
[13] The Commissioner then concluded:
“[128] In all of the circumstances and having taken account of each of the factors in section 387 and my findings thereon I have determined, on balance, that the termination of the applicant’s employment was harsh. It follows from this determination and the other matters addressed in paragraphs 104 and 105 above, that the applicant’s dismissal was unfair.”
[14] The Commissioner concluded that reinstatement was appropriate but that as Mr Wililo’s conduct contributed to his termination Parmalat should not be required to pay him for any remuneration lost since the termination.
Grounds of Appeal and Submissions
[15] Parmalat submits the decision raises important questions as to the enforcement of safe working practices and the employer’s right to take disciplinary action against employees for breaches of safety. It submits that the Commissioner erred in using the matters in paragraphs [124] to [127] to find the dismissal harsh. It submits that considered objectively, these factors did not outweigh the findings of a valid reason for serious misconduct and compliance with the procedural fairness considerations. Parmalat also submits that the Commissioner made a significant error in her finding about the gravity of the safety breach and consequently the finding about dishonesty in the investigation process. It also submits that the Commissioner erred in finding that reinstatement was appropriate.
[16] Parmalat submits that it is in the public interest that the Tribunal confirm the right of an employer to dismiss employees who are guilty of a significant safety breach particularly as that breach is found by the Tribunal to constitute serious misconduct.
[17] The TWU on behalf of Mr Wililo submits that permission to appeal should not be granted and/or the appeal should be dismissed as Parmalat has not established any error of substance and that the alleged errors amount to an invitation to the bench to make findings of fact different to that of the Commissioner. It submits that the appeal is without merit, fails to establish any error, let alone one that satisfies the House v R standard.
Permission to Appeal
[18] In our view this case raises important questions about the respective rights and obligations of employees and employers in relation to safety requirements at the workplace. Employers have important statutory obligations to maintain a safe place of work. Those obligations have a high profile in NSW. Establishing and enforcing safety rules are an important obligation, a breach of which can lead to serious consequences.
[19] In this case the employer considered, and established to the satisfaction of the Commissioner, that Mr Wililo had breached its safety rules and his conduct amounted to serious misconduct. Clearly disciplinary action was necessary and appropriate because a failure to do so sends a message to the workforce that safety breaches can occur with impunity. The application of the unfair dismissal provisions to this case is a matter of general importance and in our view clearly attracts the public interest. We therefore grant permission to appeal.
The Exercise of the Discretion
[20] The grounds of appeal address a number of different aspects of the Commissioner’s decision. In a broad sense Parmalat says that when an employee is found to have been dismissed for a safety breach, this amounts to a valid reason for termination and indeed serious misconduct, and the employer applies appropriate measures to ensure procedural fairness, it is inconceivable that a conclusion could be reached that termination of employment is harsh.
[21] More specifically Parmalat submits that the Commissioner made significant errors in relation to the findings on the gravity of the misconduct and had regard to factors in apparent mitigation of the primary conclusions which did not logically lead to the ultimate conclusion that the termination was harsh. It was submitted that if the factors were relied on as mitigating factors there was reliance on irrelevant considerations, and if there was not then the failure to take into account some factors against Mr Wililo amounted to a failure to take into account relevant considerations.
[22] Parmalat also submitted that the notion of reinstating an employee guilty of serious misconduct in the absence of any procedural defect or mitigating factor is patently unreasonable and unjust such that the decision should be quashed on the general grounds of House v R.
[23] A consideration of these arguments involves a more detailed consideration of the reasoning of the Commissioner and the various matters dealt with in her decision.
[24] We do not consider that the decision discloses a clear line of reasoning leading to the decision reached. The existence of a valid reason is a very important consideration in any unfair dismissal case. The absence of a valid reason will almost invariably render the termination unfair. The finding of a valid reason is a very important consideration in establishing the fairness of a termination. Having found a valid reason for termination amounting to serious misconduct and compliance with the statutory requirements for procedural fairness it would only be if significant mitigating factors are present that a conclusion of harshness is open. We do not believe that any of the circumstances involved in this matter amount to such factors.
[25] It is not clear to us that in referring to other considerations under s387(h) the Commissioner was suggesting that these were mitigating factors. If they were so considered we believe she fell into error. The service and disciplinary record of Mr Wililo was not a mitigating factor as his service was short and his disciplinary record was poor. The failure to show Mr Wililo the CCTV footage was not a matter of significance. It was largely inconclusive and could not have altered the conclusion that Mr Wililo had an adequate opportunity to respond to the allegations against him.
[26] Mr Wililo’s conduct was found to be serious misconduct. It involved deliberate acts. We consider that characterising the actions as carelessness does not derogate from the seriousness of his action or the possible consequences. Further we do not believe that there was a sufficient basis to find that the employer could not apply its safety standards because of alleged actions in relation to other safety breaches. If it was entitled to take the action in this case the need to enforce its safety rules suggests that the resultant termination is not harsh.
[27] We were also asked to view the CCTV footage to assess the findings of the Commissioner in relation to the events involved. This is a difficult issue but we tend to agree that the footage does not appear to establish the findings of the Commissioner in relation to the footage.
[28] As we have indicated the Commissioner does not say, in terms, that these matters were mitigating factors. It may be that the finding of harshness was based on other grounds not immediately apparent from her reasons, such as the failure of the employer to establish that Mr Wililo placed his head and torso under a forklift load (as distinct from his arm and hand) and the consequent failure of the employer to establish dishonesty to the Commissioner’s satisfaction.
[29] Added to this difficulty in discerning the true reasons for her ultimate finding we consider it somewhat anomalous that an employee found guilty of serious misconduct for breaching safety rules, and hence dismissed for a valid reason, after due process, could be considered to be harshly terminated in the absence of discernable and significant mitigating factors. These concerns involve matters of principle and the overall reasonableness of the decision.
[30] In these circumstances we find that the Commissioner’s decision is attended by error. The errors are of the House v R kind. In our view the Commissioner’s discretion miscarried, the appeal should be allowed and the decision quashed.
[31] We consider that we have the materials available to us to determine the matter and refer to our consideration of the matters above and the overall circumstances as summarised in the Commissioner’s decision and the evidence led by the parties in the matter.
[32] In our view there was a valid reason for termination and the situation would be more serious if the witness accounts of Mr Wililo’s actions are accepted. In any event his conduct amounted to serious misconduct.
[33] We consider that Mr Wililo was given an adequate opportunity to respond to the allegations against him.
[34] In our view there are no mitigating factors that should have led to a lesser penalty than dismissal being adopted. Mr Wililo was employed only for a short time and has since found other employment. It is not for the Tribunal to place itself in the shoes of the employer and determine what it would have done in the circumstances. We must consider whether the employer’s action in terminating Mr Wililo’s employment was harsh, unjust or unreasonable in the circumstances. We find that it was not.
Conclusions
[35] For the reasons above we grant permission to appeal and allow the appeal. We quash the decision of Commissioner Cargill and dismiss Mr Wililo’s application for relief under s394 of the Act.
VICE PRESIDENT WATSON
Appearances:
I. Latham, of counsel, for the Appellant
A. Aspromourgos for the Appellant
O. Fagir for the Respondent
Hearing details:
SYDNEY.
2011
22 FEBRUARY
2 Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission (2000) 203 CLR 194.
3 (1936) 55 CLR 499.
Printed by authority of the Commonwealth Government Printer
<Price code C, PR506990>