Fair Work Act 2009
s.604—Appeal of decision

Ausgrid Management Pty Ltd
v
Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia
(C2022/3022)

Appeal against decision [2022] FWC 963 of Commissioner Cambridge at Sydney on 28 April 2022 in matter number C2021/1485.

[1] Ausgrid Management Pty Ltd has lodged an appeal, for which permission is required, against a decision of Commissioner Cambridge issued on 28 April 2022. 1 The decision concerned an application made by the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU) made under s 739 of the Fair Work Act 2009 (FW Act) for the Commission to deal with a dispute with Ausgrid Management Pty Ltd (Ausgrid) in accordance with the dispute resolution procedure in clause 42 of the Ausgrid Enterprise Agreement 2018 (Agreement). The dispute concerned an investigation and disciplinary process initiated by Ausgrid against 10 of its employees.2 The parties requested that the Commissioner resolve the dispute by answering the following agreed question:

“Have any of the employees named in the Application to the Commission to deal with a dispute engaged in conduct that would justify Ausgrid taking disciplinary action against any of them?”

[2] In his decision, the Commissioner gave the answer “No” to the above question. Ausgrid appeals the decision on a number of grounds that we summarise later in this decision.

[3] The background facts pertaining to the dispute are set out in full in paragraphs [6]-[23] of the Commissioner’s decision. In summary, Ausgrid is an electricity distribution business. The 10 employees to which the dispute pertains are either District Operators (DOs) or Operating District Supervisors (ODSs). DOs are electricians who perform work associated power outages and other network incidents. Outages may be planned in order for maintenance to occur, in which case DOs have the responsibility of de-energising and re-energising the relevant sections of the electricity network. They also have a first responder role in emergency situations where there has been an unplanned power outage or damage to infrastructure which creates a safety risk. DOs generally work autonomously, and use an Ausgrid-supplied vehicle to travel to the section of the network where work is required to be performed. They also use Ausgrid-supplied mobile phones for communication. DOs are allocated to specified Ausgrid depots, which service defined geographic areas. ODSs perform the same work as DOs and, in addition, perform supervisory and job allocation/planning work.

[4] The DOs and ODSs work on a continuous, “24/7” shift roster consisting of rotating day, afternoon and night shifts. Planned work is only performed on day and afternoon shifts and unplanned work may occur on any shift. Personnel in Ausgrid’s Sydney Control Room in Silverwater arrange and coordinate the tasks which DOs and ODSs (when performing DO work) may be required to perform during a shift. Planned work required to be performed is usually communicated by email to DOs and ODSs prior to the start of their shift. DOs and ODSs sign on for a shift by phoning the Control Room, and at this point the Control Room will confirm the planned work to be performed or alter it according to exigencies, including the need to respond to unplanned events. After a network task has been completed, DOs and ODSs contact the Control Room to advise of this, in which case they may be direct to undertake another task or advised to wait for the assignment of further tasks later in the shift. On night shifts, when there is no planned work, DOs and ODSs sign on at the start of a shift and then wait to be assigned a task.

[5] Historically, DOs and ODSs have taken their Ausgrid-supplied vehicles home, and have travelled in their vehicles from their home to their depot to start work or to their first job site for a shift. On 10 July 2015, Ausgrid sent a memorandum (2015 memorandum) to DOs and ODs which stated that they were required to be in attendance either at their depot or first job site at the start time for their shift and likewise be at their depot or their last job site and the end of their shift. In June 2020, Ausgrid received an anonymous whistleblower report which alleged that a list of named ODSs were:

•  accumulating excessive amounts of overtime and engaging in other misconduct that did not align with Ausgrid’s policies;

•  starting their allocating and scheduling days late and leaving early, thus making them unavailable to assist with planned work enquiries; and

•  starting their shifts whilst remaining at home well into the hours of the shift, returning to their home during their shift for an excessive amount of time, and staying home whilst expected to be available even where their home was outside their assigned geographic area.

[6] Ausgrid began an investigation of this report. In doing so, it accessed data derived from the In Vehicle Monitoring System (IVMS) installed in the vehicles of about 150 DOs and ODSs from which the location of the vehicles at particular dates and times could be identified, and compared this with the My Time attendance records for these employees. The investigation proceeded by reference to a randomly-selected month in the period July-December 2019. The 10 employees the subject of the dispute (eight DOs and two ODSs) were sent letters entitled “Allegations of Potential Serious Misconduct” in the period January-February 2021. The serious misconduct alleged was, in general terms, that the relevant employee had claimed and received wage payments they were not entitled to because they were either at home or not in their assigned geographic area during paid time. These allegations were particularised by the identification of dates and times at which the relevant employee was said, either in ordinary time or overtime, to have started a shift late, finished a shift early, remained at home for an entire shift, or gone home for part of a shift.

[7] The employees were stood down on pay and provided with an opportunity to respond to the allegations. After their responses had been received, eight of the employees were issued with “show cause” letters requiring them to explain why their employment should not be terminated. The affected employees responded to these letters in March 2021. The CEPU lodged its s 739 application on 17 March 2021. Under the “status quo” provision of clause 42 of the Agreement, the disciplinary process against the employees was then suspended. However, by the time the Commissioner heard the matter, six of the 10 employees had, pursuant to an agreed arrangement, been issued with a formal warning (being a final warning in the case of five of them) and returned to work.

[8] The substantive outcomes the CEPU sought in the matter before the Commissioner were for the formal warnings issued to the six employees to be expunged, and for no disciplinary action to be taken with respect to the other four employees.

The decision

[9] The Commissioner commenced his consideration of the agreed question by stating that “the Commission has been required to undertake a detailed review of the actions and decisions taken by Ausgrid which culminated in the disciplinary action taken against the disciplined employees”, 3 and went on to say:

“[61] Consequently, the Commission’s review has involved analysis of the relevant actions and decisions taken by Ausgrid which commenced with actions associated with both the investigation phases, preliminary and substantive, and it has subsequently traversed the activities undertaken and decisions made by Ausgrid during the disciplinary processes that followed the investigation phases. This analysis has resulted in the identification of a number of major issues of concern…”

[10] The first “issue of concern” identified by the Commissioner concerned “Policies and Privacy”. The Commissioner found that, in analysing the IVMS data and using it to establish the location of the employees at relevant dates and times, Ausgrid breached its Fleet Motor Vehicle Allocation (FMVA) policy. In this respect, the Commissioner found that Ausgrid had contravened a specific prohibition in the FMVA policy which prohibited the use of IVMS data collected within a one-kilometre radius of an employee’s home for the purpose of a disciplinary investigation. 4

[11] The second matter considered by the Commissioner, which he considered “further impugns the investigation phases”, 5 was that the whistleblower report which led to the initiation of the investigation made allegations only against a list of named ODSs (which list was not disclosed to the Commission), and there was no evidence provided which explained how those allegations were expanded to include examination of the IVMS data with respect to approximately 150 employees. The Commissioner said that, in the absence of any such explanation, the investigation contravened that part of the IVMS policy which required that the use of IVMS data in an investigation must relate specifically to an allegation. The Commissioner proceeded on the assumption that none of the 10 employees was included in the list of names in the whistleblower report (since this would otherwise have been disclosed), and said that the corollary of this appeared to be that the individuals actually named in the whistleblower report escaped any disciplinary action.6

[12] The third matter dealt with by the Commissioner was under the heading “Common Practice and Cultural Norm”. The Commissioner characterised the gravamen of the allegations against the 10 employees as being “timesheet fraud”, 7 and said:

“[87] The alleged timesheet fraud broadly encompassed three categories of conduct identified by analysis of the IVMS data which showed the location of the individual’s vehicle at a time when time and attendance records showed that employee to be on paid ordinary time or overtime. The first broad category of conduct identified that the employee’s vehicle was located at his (all of the disciplined employees are males) residential address at the time at which he commenced a rostered shift. The second broad category of conduct involved circumstances where the employee’s vehicle leaves a location then travels to the employee’s residential address either before the scheduled end of the shift or it reaches the residential address after the scheduled end of the shift, and the employee has claimed overtime that encompassed and/or extended beyond the time of the return to the residential address. The third broad category of conduct specifically related to night shifts when the employee’s vehicle was shown to be at his residential address for significant periods of time including, in some instances, for the entire night shift.

[88] The 2015 memorandum did not permit the circumstances identified in the three broad categories of conduct which, in essence, disclosed a practice whereby a DO (and ODSs performing DO work) would start and finish their shift from home including night shifts when, in the absence of any unplanned work, they would await any assignment of work at their home. Instead, the 2015 memorandum directed that DOs (and ODSs performing DO work) either start and finish all shifts at their assigned depot, or be in attendance ‘at the first job in their depot area’ or ‘at the last job in their depot area’ at the respective start and finish times.

[89] Although some of the disciplined employees claimed that being at either the first or last job in their depot area included their home in circumstances when they undertook preparatory work at home before they travelled to the site of any planned work, and when they performed other work-related tasks once they had reached home, they all strongly maintained that the working from home arrangements were a common practice of long-standing, observed generally, and either openly or implicitly, sanctioned by their relevant managers. Consequently, when responding to the allegations of potential serious misconduct and answering to the show cause letters, the disciplined employees defended their actions by inter alia, informing Ausgrid that the alleged misconduct was common practice and part of the cultural norm which relevant managers knew about.”

[13] The Commissioner found that, despite the widespread breaches of the 2015 memorandum (such that the investigation disclosed that alleged timesheet fraud had been committed by somewhere between 50 and 100 of the 150 employees investigated), 8 Ausgrid “took the conscious decision” not to make any inquiries with relevant managers or control room staff about the common practice and cultural norm defence raised by the employees, and took no disciplinary action of any form against any employee, including managers, other than the 10 employees.9 This caused the Commissioner to characterise the investigation as “fundamentally deficient because it consciously ignored the common practice and cultural norm defences of the disciplined employees”,10 and he found that this was in breach of Ausgrid’s own Fair and Just Culture Policy.11 The Commissioner also said that “to take disciplinary action against only some of a larger group of employees who all engaged in alleged misconduct, which was condoned by their managers, would be fundamentally unreasonable and unjustifiable” and that “the resultant culture of the organisation is one where management protects itself by finding scapegoats to appease complaint or criticism”.12

[14] The next issue dealt with by the Commissioner was what he described as the “Selection Lottery”. The Commissioner found that Ausgrid’s methodology for “producing a ranking table from which ‘the top 10’ were selected” for disciplinary action as having “three particularly troubling defects: 13

(1) It would have been a matter of luck as to which month was selected for each individual’s analysis, and there was every prospect that a particular month that had not been selected for a particular individual could have identified a greater degree of alleged timesheet fraud. 14

(2) Ausgrid’s analysis was predicated on an assumption that unless an employee’s vehicle was tracked to have been located at a depot or a job site, the employee was not performing work for which they were entitled to be paid. However, the evidence was that employees regularly performed work outside of their paid shifts including preparatory work for planned jobs at home. 15

(3) The decision to select the “top 10” as opposed to a different number was in part based on operational need in that Ausgrid wanted to ensure that it could retain a sufficient number of DOs in active engagement to meet operational needs. This meant that individuals ranked number 11 and beyond escaped any scrutiny whatsoever, and the result whereby a quantitatively lower incidence of timesheet fraud would result in there being no disciplinary action at all manifested as a “plain injustice” for the “top 10”. 16

[15] The Commissioner then dealt with one of the 10, Paul Galea, whose circumstances were different. The “serious misconduct” alleged against him was that, when he was asked to hand over his work phone to an Ausgrid manager for the purpose of the investigation (apparently in order to retrieve geolocational data), he untruthfully told the manager that the phone was not in his possession at the time, and subsequently told a further untruth when he was asked where the phone was. 17 The Commissioner found that Mr Galea had subsequently admitted his dishonesty and apologised for it, and had explained that his dishonesty arose in circumstances where he had attended the relevant meeting on the understanding that it was not to be disciplinary in nature and therefore felt that he had been ambushed.18

[16] The Commissioner found that there were factors which mitigated Mr Galea’s dishonesty:

(1) Although Mr Galea had been dishonest with Ausgrid, Ausgrid had also been dishonest with him in telling him that the relevant meeting he was to attend was to finalise the disciplinary process in respect to his circumstances, and was not told that he was to be the subject of any further inquiry such as a directive to hand over his phone. Thus, “Mr Galea’s lie was a response to a lie”. 19

(2) The directive for Mr Galea to hand over his phone was unreasonable. Some personal use of the phone was permitted, and it was unreasonable to require an employee to immediately surrender it without adequate prior notice which would enable the removal of any personal material. 20

[17] The Commissioner found that these matters, coupled with Mr Galea’s admissions and contrition, meant that Mr Galea had not committed misconduct for which any disciplinary action could be justified. 21

[18] Finally, the Commissioner considered the following matters:

“[111] In fairness, mention must be made of the evidence of some of the more significant incidents which the substantive investigation revealed. Interestingly, two particular incidents would have been discovered even if the substantive investigation had been conducted in compliance with the one kilometre blackout. Two of the disciplined employees were outside of their area of operation when they were on a paid shift. One individual had signed on when travelling towards his operational area at the commencement of a shift, and the other had travelled outside his operational area on Christmas [D]ay.

[112] The common practice, as broadly recognised by the disciplined employees, did not allow for circumstances where a DO (or ODS performing DO work) would be outside of their relevant operational area whilst signed on with the Control Room. Although an individual may validly assert that despite being outside of their operational area, they could still quickly respond to any work requirement, they nevertheless acted contrary to the established practice. If a more sensible approach to the investigations and disciplinary action had been taken, these two particular circumstances, involving breaches of the common practice whereby DOs (and ODSs performing DO work) were to be within their operational area whilst on paid time, should have probably justified some reprimand.”

[19] The Commissioner’s overall conclusion, as earlier stated, was that the question posed for determination should be answered “No”. The Commissioner said:

“[115] … In summary, the examination and consideration of the major issues of concern has established that Ausgrid’s actions and decisions, which culminated in the disciplinary action taken against the disciplined employees were, (a) contrary to its Policies including those related to the privacy and discipline of its employees, (b) failed to recognise the common practice and cultural norm of the conduct under consideration, (c) included the deliberate exclusion of inquiries and information which were vital to a proper determination of the conduct under consideration, (d) involved an arbitrary and unjust selection methodology, and (e) specifically, in respect to Mr Galea, failed to recognise and balance its own deceitful and unreasonable actions.

[116] The deficiencies and errors that were revealed in the actions and decisions of Ausgrid as identified through examination of the major issues of concern, were very regrettable. Unfortunately, the circumstances in this case have revealed an approach where Ausgrid management was motivated to provide a perception that it took stringent action in response to a whistleblower complaint, irrespective of the valid[it]y of the complaint, and in a way which protected Ausgrid management from any scrutiny, and instead, sought to have some Ausgrid employees disciplined as scapegoats to appease any complaint or criticism.”

Appeal grounds and submissions

Ausgrid

[20] Ausgrid advanced eight grounds for its appeal. Its first appeal ground is that the Commissioner erred in finding that Ausgrid was not entitled to access or use the IVMS data collected within one kilometre of the employees’ homes. In support of this appeal ground, Ausgrid submitted that there was uncontradicted evidence that the one-kilometre “blackout” restriction had been removed when the IVMS policy was introduced in 2018, and that there had been consultation with the CEPU and employees about varying the FVMA policy accordingly, with the failure to update the FVMA policy in terms being a mere oversight. Further, it submitted, employees had been advised in 2018 that “historic” IVMS data would be available for use in misconduct investigations.

[21] Ausgrid’s second appeal ground is that the Commissioner erred in finding that it had contravened the IVMS policy by conducting an investigation into persons other than those named in the whistleblower’s report. It submitted in respect of this ground that there was no breach of the policy because, as the Commissioner found, it was the whistleblower’s report and not the IVMS data which caused Ausgrid to initiate the investigation. Once authorisation existed under the IVMS policy to access the IVMS data, there was no restriction on what data could be accessed save that it had to relate to an allegation and, in this case, it was relevant that the employees investigated may have engaged in the same conduct as the employees named in the whistleblower’s report.

[22] The third appeal ground was that the Commissioner erred in finding that Ausgrid breached its Fair and Just Culture Policy. Ausgrid submitted that:

•  there was no evidentiary basis for the Commissioner to conclude that Ausgrid had ignored the common practice/cultural norm explanations advanced by the 10 employees; to the contrary, there was evidence that such explanations were taken into account and that “certain inquiries” were made with management;

•  the evidence did not establish that there was no investigation of these matters;

•  there was no proper basis for the Commissioner to conclude that the conduct of the 10 employees was “condoned by their managers”, since none of the employees gave evidence that they had told their managers they were acting contrary to the 2015 memorandum or that their managers had agreed to this, and there was evidence that Ausgrid had reiterated the obligations under the 2015 memorandum in November 2019 which demonstrated that the employees’ conduct was not condoned by Ausgrid; and

•  there was no evidence to support the Commissioner’s finding that Ausgrid management realised that the investigation had not been properly conducted.

[23] By its fourth appeal ground, Ausgrid contends that the Commissioner erred in finding that Ausgrid’s selection methodology was arbitrary and unjust in that the Commissioner failed to have proper regard to the evidence concerning how Ausgrid determined to which employees it would issue “show cause” letters. In respect of the three “troubling defects” which the Commissioner identified in the selection methodology, Ausgrid submitted that:

•  the first was pure speculation, since there was no evidence adduced by any of the 10 employees that the particular month chosen was abnormal;

•  as to the second, the Commissioner’s assumption that, unless an employee’s vehicle was tracked to have been located at a depot or a job site, the employee was not performing work for which they were entitled to be paid, was valid given the employees’ obligations under the 2015 memorandum; and

•  as to the third, it was incorrect to say that the selection of the “top 10” was largely driven by operational needs, since the 10 were assessed against the same criteria as all other employees but were determined to be acting differently to other compliant employees who were located at the depot and entering time accurately.

[24] In any event, it was submitted, the 10 employees had been entitled to address Ausgrid in their own defence in the disciplinary process, and Ausgrid was entitled to accept or reject these matters as explanations or excuses in the exercise of its discretion in conducting the investigation.

[25] Ausgrid’s fifth appeal ground is consequential upon the earlier appeal grounds: it contends that the Commissioner’s ultimate answer to the question posed for determination was vitiated by the errors identified in the first to fourth appeal grounds. In addition, it was submitted that it is apparent that in answering the question the Commissioner limited his focus to Ausgrid’s conduct and actions, and did not do what the question required, namely identifying the conduct engaged in by the employees and then determining whether Ausgrid would be justified in taking (some or any, but not what type of) disciplinary action against one or more of the employees.

[26] The sixth appeal ground is concerned with the position of Mr Galea. Ausgrid contends by this ground that the Commissioner erred in finding that Mr Galea’s dishonesty was justifiable. It submitted that:

•  Ausgrid’s direction to Mr Galea to hand over his phone, which was a work phone belonging to Ausgrid, was not unreasonable, since Ausgrid had a right to have the phone returned whenever it determined, and gave Mr Galea a chance to remove his personal material and provided him with a personal phone;

•  even if Mr Galea was under the impression that the relevant meeting was to finalise the investigation as it pertained to him, it did not follow that Ausgrid deceived Mr Galea — Ausgrid had advised him that it was close to finalising the investigation but never told Mr Galea that it would not ask him to hand over his phone;

•  it further did not follow that Mr Galea was justified in lying about having the phone in his possession or later lying again; and

•  Mr Galea’s dishonesty was a breach of Ausgrid’s Code of Conduct which justified Ausgrid taking disciplinary action.

[27] Ausgrid’s seventh and eighth grounds of appeal are that the Commissioner’s finding in paragraph [116] of the decision (set out above) concerning Ausgrid’s motivation in conducting the investigation involved a denial of procedural fairness and gave rise to an apprehension of bias. It submitted that the finding was highly pejorative and entirely unsupported by any evidence, and that the vehemence of the Commissioner’s terminology in this context might create a reasonable apprehension that the Commissioner might have prejudged the question against Ausgrid rather than forming an assessment on the case presented. It was also submitted that a denial of procedural fairness occurred because the CEPU did not advance any contention concerning Ausgrid’s motivation in conducting the investigation and, in the absence of any evidence supporting the Commissioner’s finding, the Commissioner should have but did not put this matter to Ausgrid’s witnesses or explain in the decision how he came to make this finding.

[28] Ausgrid submitted that granting permission to appeal would be in the public interest because the decision manifests an injustice to Ausgrid, is counter-intuitive, involved a constructive failure to exercise the jurisdiction (because the Commissioner focused on Ausgrid’s conduct rather than the conduct of the employees as the agreed question required), and denied Ausgrid procedural fairness. It submitted that permission should otherwise be granted on discretionary grounds because the decision is attended by sufficient doubt to warrant its consideration and substantial injustice might result if leave were refused. Ausgrid sought that the appeal be upheld, the decision quashed, and the matter remitted to another single member of the Commission for redetermination.

CEPU

[29] The CEPU submitted that, in response to Ausgrid making the serious allegation that the 10 employees had engaged in “timesheet fraud” and “dishonesty” entirely on the basis of the IVMS, the employees had said:

•  the hours they were recorded as working time were the hours they in fact worked;

•  they worked and recorded their working time consistently with established and long-standing practice which was well known throughout Ausgrid including by their direct managers;

•  Ausgrid was not entitled to use the data it used because it had promised not to use it in its policies and elsewhere;

•  the investigation was unsound for a miscellany of reasons including the deliberate exclusion from the investigation of making enquiries of managers and others;

•  reliance upon what the employees had done as a basis for disciplinary action was itself contrary to Ausgrid’s policies which required Ausgrid to act fairly and justly; and

•  the action proposed against one employee, Mr Galea, was in its particular circumstances not justified.

[30] It further submitted that the Commissioner’s acceptance of the employees’ response, and his answer to the question for determination, involved the exercise of a broad discretionary power such that the principles concerning appeals against discretionary decisions applied. The CEPU submitted that the decision was not attended by error that would justify appellate intervention and that Ausgrid’s grounds of appeal appeared generally to be an attempt to have the Commission come to a different view on questions of fact by analysing for itself the evidence and making findings of fact rather than involving the identification of error. Permission to appeal should not be given, it was submitted, because any errors of fact were not significant, the appeal facility should not become a search for error designed only to facilitate a reconsideration of the merits and the appeal raised no wider considerations that would attract the public interest.

[31] In relation to the first ground of appeal, the CEPU submitted that there was no evidence about the outcome of any consultation to change the FMVA policy to remove the one-kilometre “blackout” nor about any decision having been made by Ausgrid to change the policy, and the fact that the one-kilometre “blackout” remained in the policy at the time of the hearing before the Commission suggested that no such decision had been made. In respect of the IVMS policy, the CEPU pointed to evidence that employees were advised that data collected in the one-kilometre radius zone would be used only to ensure emergency duress functionality and safety and not for disciplinary purposes, and said that the Commissioner was entitled to rely on this evidence.

[32] In relation to the second ground of appeal, the CEPU submitted that the Commissioner was entitled to conclude that the use of IVMS data to investigate employees other than those named in the whistleblower’s report breached the IVMS policy since the fact that none of the 10 employees was named in the report meant inevitably that there was nothing related to a specific allegation at all, particularly given the absence of evidence connecting the allegations in the whistleblower’s report to the 10 employees.

[33] As to the third ground of appeal, the CEPU submitted that:

•  the Commissioner’s finding that management condoned the practice adopted by the employees and others concerning starting and finishing work at home by signing on and off from home was unsurprising because the evidence was all one-way so far as line managers and control room operators were concerned;

•  no line manager or control room operator was called to give evidence to put into question the practice adopted by 40-90 employees;

•  there was no investigation concerning the degree of knowledge of line managers of this practice, and there was an unexplained directive that the investigation not speak to them;

•  condonation was a complete answer to the alleged misconduct, and Ausgrid’s suggestion that it “considered” the employees’ contentions concerning common practice, cultural norm and condonation ignored the fact that this was a complete answer to the charge of misconduct; and

•  Ausgrid’s suggestion that the investigation was “detailed and fair” was an attempt to have the Commission made findings in the appeal which are not supported by any evidence, given that the investigation involved only comparing IVMS date with time records and that no interviews of managers, control room operators or the other 140 employees who escaped “scot-free” were conducted.

[34] In response to the fourth ground of appeal, the CEPU submitted that the question of the disciplinary lottery was confirmed by Ausgrid’s submissions, and that to suggest that selecting a random month for analysis was unremarkable was contrary to common sense and ordinary experience. The allegation of “timesheet fraud” was more than technical non-compliance with the 2015 memorandum and suggested that employees were not working at times for which they claimed payment, but this was contrary to the evidence of what in fact was going on. Further, it was submitted, the evidence was clear that operational need was the driving force for choosing the 10 employees to be disciplined and that between 50 and 100 employees were doing much the same thing.

[35] As to the fifth ground of appeal, the CEPU submitted that:

•  the ground failed to recognise that the conduct of the employees was consistent with the common practice and cultural norm;

•  the employee conduct that was alleged involving starting and finishing work at home or being at home during night shift was squarely identified by the Commissioner and the Commissioner’s analysis proceeded upon an acceptance that that conduct had occurred;

•  the Commissioner accepted that the conduct was consistent with the common practice and cultural norm; and

•  therefore the Commissioner did not focus “only” on Ausgrid’s conduct.

[36] In relation to Mr Galea, the CEPU submitted that the sixth ground of appeal was a paradigmatic example of Ausgrid seeking that the Full Bench substitute its own view of the facts on appeal in circumstances where a finding as to the justification for disciplinary action requires an evaluative judgment to be made. It submitted that reasonable minds might differ “about the reasonableness of tricking an employee into coming to a meeting in the belief it was to finalise an investigation when what is really happening is that the employee was being ambushed by a demand that they hand over their private and personal information whether it be on the employer’s property or not”. The correctness standard was not to be applied to the Commissioner’s evaluation that disciplinary action was not justified because of the mitigatory matters he identified, and Ausgrid’s contention that disciplinary action was justified because Mr Galea breached the Code of Conduct was one-dimensional and inimical to a proper assessment of whether disciplinary action was justified in all the circumstances.

[37] Finally, as to the seventh and eighth grounds of appeal, it was submitted that the Commissioner’s observation at paragraph [116] was based on the evidence, which established that Ausgrid studiously avoided any investigation involving the employee’s managers and in fact directed that they not be spoken to, and it was clear that the 10 employees were treated as scapegoats because they were the only ones of over 50 and potentially exceeding 100 employees who were disciplined. In those circumstances, the CEPU submitted, the inference drawn by the Commissioner as to Ausgrid’s motivation was available, particularly as the actual managerial decision-maker was not called to give evidence. It was submitted that the firm expression of an opinion adverse to a party at the end of a matter, even if not related to any of the findings upon which the matter ultimately turned, does not demonstrate prejudgment of the issues or even an apprehension of prejudgment. Nor was there any denial of procedural fairness because the Commissioner’s observation did not bear upon the final outcome given the articulated basis for the Commissioner’s answer to the question posed for determination.

Consideration

[38] It is appropriate that we deal with ground eight of the appeal first. It will only be in a rare and exceptional case where apprehended bias can be demonstrated by reference to the published reasons for a decision, since the mere fact of adverse findings at the end of a matter does not give rise to an inference as to the state of mind of the decision-maker before and whilst the matter was under consideration, nor of prejudgment of the issues that fell for decision. This is so even where the adverse findings are contrary to the evidence or unreasonable or are the product of a hopelessly flawed reasoning process. 22 In respect of the view expressed by the Commissioner in paragraph [116] of his decision concerning Ausgrid’s motivation in conducting the investigation/disciplinary process, Ausgrid did not identify any earlier conduct of the Commissioner during the hearing which might support an inference of an apprehension of bias. Without more, the pejorative statements in paragraph [116] cannot reasonably give rise to an apprehension of bias. Ground eight of the appeal is therefore rejected.

[39] Of the remaining grounds of appeal, it is only necessary for us to determine two of them, namely grounds five and six. In respect of ground five, we accept in part Ausgrid’s submission that the Commissioner erred in undertaking the evaluative assessment which answering the agreed question required by taking into account matters which were relevant only to Ausgrid’s conduct and not that of the 10 employees. We have earlier set out the agreed question. That question required, first, that findings of fact be made about whether the employees had engaged in the conduct alleged against them and, second, the formation of an evaluative judgment as to whether any such conduct found to have occurred justified Ausgrid taking disciplinary action against any of them. However, the Commissioner (at the urging of the CEPU) took into account two matters as “issues of concern” which we consider not to have been relevant to either of these two steps in the analysis, namely, Ausgrid’s use in its investigation of IVMS data within the one-kilometre “blackout” zone and whether Ausgrid had a proper basis to use the IVMS data at all on the basis of the matters alleged in the whistleblower’s report.

[40] By the time of the hearing before the Commissioner, Ausgrid’s investigative process, which included its retrieval and analysis of the IVMS data relating to the 10 employees, had been carried out and completed. At the hearing the Commissioner admitted, without objection from the CEPU, evidence adduced by Ausgrid directed to establishing the employees’ misconduct which was substantially based upon its analysis of the IVMS data. That being the case, it was the task of the Commissioner to assess that evidence, and the evidence adduced on behalf of the employees by the CEPU, and determine whether the alleged conduct occurred and, if so, whether it justified disciplinary action. We note that, for the most part, the conduct which was alleged on the basis of the analysis of the IVMS data was not contested by the CEPU so that it was principally the second of the two steps in answering the question identified above which the Commissioner was required to undertake. It was immaterial in this context whether the IVMS data had been used by Ausgrid in breach of its own policies since the question directed attention to whether the employees’ conduct justified disciplinary action, not whether Ausgrid was disqualified from taking disciplinary action because of the way it carried out its investigation.

[41] We emphasise that, in stating this conclusion, we do not intend to deprecate the validity or significance of the concerns raised by the CEPU and accepted by the Commissioner about the conduct of Ausgrid’s investigation. Ausgrid did not adequately explain how the whistleblower’s report, which alleged misconduct on the part of a number of named ODSs, could legitimately result in an investigation and disciplinary process being conducted in respect of a group of 11 employees who were predominantly not ODSs and who were not named in the whistleblower’s report. Further, we accept that the unrestricted use of IVMS data relating to the location of Ausgrid vehicles for disciplinary purposes when Ausgrid permits those vehicles to be taken to and from employees’ homes may raise genuine privacy concerns. However, while a different question for determination might well have required the Commission to give consideration to these issues, for the reasons stated we do not consider that they were relevant to the question which the parties asked the Commissioner to determine.

[42] It is clear that the Commissioner’s consideration of these two of the four “issues of concern” significantly influenced the answer he gave to the agreed question. This is most clearly seen in paragraphs [111]-[112] of his decision, where the Commissioner considered the position of two employees who were found to be outside of their designated operational area during paid time. The Commissioner acknowledged that the two incidents concerned “would have been discovered even if the substantive investigation had been conducted in compliance with the one kilometre blackout”, and considered that the conduct of these employees “should probably have justified some reprimand” if “a more sensible approach to the investigations and disciplinary action had been taken”. That indicates to us that, in respect of these two employees, the answer to the question may have been “Yes”, at least to the level of disciplinary action indicated, if the matters concerning the way in which Ausgrid conducted its investigation had not been taken into account. We consider it equally possible, if not likely, that the answer the Commission gave to the agreed question with respect to the remaining employees may have been different if he had not erroneously taken into account these first two “issues of concern”.

[43] Ground six of Ausgrid’s appeal specifically concerns the position of Mr Galea. We accept Ausgrid’s contention that the Commissioner’s finding that Ausgrid had been “deceitful” and had “lie[d]” about the meeting with Mr Galea at which he was asked to hand over his phone was not supported by the evidence. Mr Galea did not give evidence in either of his witness statements that any Ausgrid manager told him that the investigation had been finalised ahead of the relevant meeting, which occurred on 15 March 2021 (as the contemporaneous documents make clear). Rather, he said in his second witness statement that his CEPU representative, Darran Miller, had told him the previous week that Josh Fernley (an Ausgrid “People Partner”) had advised him (Mr Miller) that “the matter had been finalised”. 23 Mr Galea also said that Liam Baker (Ausgrid’s Head of Operating, Installations and Emergency Response) had called him the previous week to arrange the meeting and had suggested conducting the meeting remotely via teleconference, but Mr Galea did not say in either of his witness statements that Mr Baker had said anything about the purpose of the meeting beyond stating that it was to “resolve the issue”.24

[44] When Mr Galea was cross-examined, he insisted that Ausgrid had lied to him before the meeting on 15 March 2021 and, when asked who lied to him and when, the following exchange occurred between Mr Galea and counsel for Ausgrid:

“THE WITNESS: Liam Baker called me up the Thursday before and said, ‘Can you come in tomorrow and we’ll finish this. It's all over.’

MR DARAMS: That’s what you can recollect ‘and we will finish this - - -’?---That’s what I can recollect. He even said - I said I couldn’t get there because I was going to Bathurst the next day. He said, ‘We’ll do it over the phone.’

Okay?---That to me is it’s over. We would do it over the phone and Darren Miller had been advised by Josh [Fernley] that it was over.

Right. I see?---That’s how – that’s what I decree to be a lie.” 25

[45] Mr Galea went on to say:

“Effectively, look, I walked into a trap. I’ve walked in there – I’ve been told that it’s over. I walk in, I get surrounded. You’re going on about the meeting and how the meeting was conducted, and how it went. That’s what it was. You can colour it any way you want; that’s exactly what happened.” 26

[46] This evidence was supplemented by that of Mr Miller, given in two witness statements. It is apparent that Mr Miller was confused about the date of the relevant meeting since, in his first statement, he said that after a “show cause” meeting with Mr Galea on 17 March 2021, and after Mr Galea had been issued with a “show cause” letter, Mr Fernley rang him on 19 March 2021 to arrange a further meeting. In his statement, Mr Miller recounted that Mr Fernley said words to the following effect: “We can’t verify the allegations against Paul. We still need to have a conversation with Paul with regard to work practices moving forward and the need to park in the depot, and a return to work. Would you be available for a Microsoft [T]eams meeting next Monday, the 22^nd March”. The meeting was arranged but, importantly, Mr Miller’s evidence was that Mr Galea preferred to come into the office for the meeting, and this is what occurred. Mr Miller further gave evidence that, about 10 minutes before the commencement of the meeting, we received a phone call from Mr Fernley, who advised him that “[t]he investigation is still ongoing for Paul”. Mr Miller protested about this because Mr Fernley had previously told him that the investigation was finalised and the allegations could not be verified, and he had conveyed this to Mr Galea. The meeting proceeded, Mr Fernley requested that Mr Galea provide his phone and, after a break, Mr Galea advised that he did not have it with him.

[47] Mr Baker made a statement of evidence for the purpose of the proceedings before the Commissioner, and was cross-examined on that statement. In his statement, Mr Baker did not give any evidence concerning the meeting with Mr Galea on 15 March 2021 or the process by which that meeting was arranged. When it was put to him in cross-examination that, when he had rung Mr Galea to arrange the meeting, he had told him that the meeting was to “wrap up” 27 the process and that there would be no disciplinary outcome, he rejected this. Mr Baker confirmed that he offered to conduct the meeting by phone, and that he never told Mr Galea to bring his phone to the meeting. He also accepted that he had been made aware that Mr Fernley had told Mr Miller that there would be no disciplinary outcome for Mr Galea.

[48] The import of the proposition advanced by Mr Galea and accepted by the Commissioner that Ausgrid lied about the purpose of the meeting was that the meeting had been set up as a “trap” 28 or an “ambush”29 whereby Mr Galea would be lured to the meeting under false pretences and then directed, without prior notice, to hand over his phone. However, that proposition is unsustainable on the evidence set out above, for three reasons. First, the evidence does not establish that anyone from Ausgrid said anything directly to Mr Galea before the meeting about the investigation having been finalised. Mr Galea did not say anything to this effect in either of his witness statements. His evidence changed in cross-examination, but a close analysis of that evidence (set out above) suggests that Mr Galea incorrectly conflated what Mr Baker had said with what Mr Miller had conveyed to him about what Mr Fernley had told him (Mr Miller) about the purpose of the meeting. Mr Baker firmly denied telling Mr Galea that the investigation was finished, and his evidence about this is consistent with what Mr Galea said in his second witness statement. Second, there is no dispute in the evidence that both Mr Baker and Mr Fernley requested that the meeting be conducted remotely, and it was only at Mr Galea’s request that the meeting was conducted face-to-face. That evidence is completely inconsistent with the proposition that the intended meeting was a “trap” to have Mr Galea hand over his phone. If the meeting had been conducted remotely as proposed by Ausgrid, then obviously that could not have happened. Third, Mr Miller’s evidence that Mr Fernley advised him, shortly before the meeting was due to commence, that the investigation was still ongoing indicates that the relevant Ausgrid managers had simply changed their mind, rather than that they had engaged in deliberately deceptive activity.

[49] The Commissioner’s finding that Ausgrid had been “deceitful” with Mr Galea and had engaged in a “deception” was one of the two matters on which the Commissioner relied as mitigating Mr Galea’s own dishonesty and founding his ultimate conclusion that disciplinary action against Mr Galea was not justified. Because this finding was factually in error, for the reasons stated, this must be regarded as vitiating the ultimate conclusion in respect of Mr Galea.

[50] Grounds five and six of the appeal provide a sufficient basis for us to grant permission to appeal, uphold the appeal and quash the decision. As earlier stated, our conclusion as to these grounds renders it unnecessary to determine to finality the other grounds of appeal. It is sufficient to say that:

(1) Our conclusion as to ground five renders grounds one and two moot.

(2) We would not have upheld grounds three or four had it been necessary to determine them, for reasons which will become apparent later in this decision.

(3) In respect of ground seven, we consider that the Commissioner’s conclusion in paragraph [116] concerning Ausgrid’s motivation for the approach it took to the investigation was not supported by the evidence.

Redetermination of the dispute

[51] We consider that the most efficient course is for us to redetermine the dispute based on the evidence that was before the Commissioner, rather than for us to remit the matter to a single member for further hearing, since we have already had the benefit of perusing the case materials and hearing extensive submissions about the merits of the matter.

[52] We consider that the proper starting point is to characterise the nature of the offending conduct which the employees engaged in. Except for Mr Galea, whose position is distinct for reasons which will be explained further below, there is no real factual dispute about the conduct they engaged in. That conduct was described by the Commissioner in paragraph [87] of his decision, quoted above, in a way which Ausgrid did not challenge. Accordingly, we will proceed on the basis of that description for all the employees apart from Mr Galea.

[53] The conduct described was in contravention of the 2015 memorandum, as the Commissioner found in paragraph [88] of his decision. There is no dispute that the requirement communicated in the 2015 memorandum that Dos and ODSs start and finish work at their designated shift times either at their depots or at their first or last job site in their area constituted a lawful and reasonable direction. It was also clearly a matter of significance, since it dealt with a fundamental issue concerning the manner of performance of the employees’ work. It is not in contest that the employees received the 2015 memorandum (although a number of employees gave evidence that they had no recollection of it), and that it was re-circulated on 25 November 2019. The employees’ non-compliance with that memorandum over an extended period of time therefore constituted misconduct in their employment which would, prima facie, justify some form of disciplinary action being taken.

[54] However, there are a number of significant mitigating factors. First, the evidence did not establish that the employees’ non-compliance with the 2015 memorandum was for the purpose of obtaining payment to which they would otherwise not be entitled or avoiding the performance of work which was required to be performed. There is no evidence that the employees’ practice of frequently starting and/or finishing work at home meant that any planned work was not performed in accordance with Ausgrid’s requirements. Insofar as the employees’ work involves, to a significant degree, waiting to respond to unplanned incidents (especially on night shifts), this necessarily means that a proportion of their rostered and paid working time is “dead” or non-productive time. The evidence does not establish that, if employees spent this down-time at the depot, there were substantial alternative duties which they could perform that would not be performed if they spent the down-time at home. This is most clearly illustrated by the evidence that employees are permitted to have a “nap or short rest on night shift at times when there is no planned work or emergency response” 30 and that at least some depots have couches, mattresses or beds to facilitate this. It appears that most or all of the depots also have a television for use during down-time. Mr Baker gave evidence that “[w]hen employees are waiting to be allocated work, they should be located in their depot and performing depot duties such as restocking of vehicles, responding to emails, and calls etc”.31 Further, Toby Coochiroff, who has been issued with a warning letter and permitted to return to work, gave the following evidence about what has occurred since then:

“There is still no set work for down-time in the depot. I will tidy my vehicle and perform any outstanding chores and then manage my fatigue in the depot. In practice this often involved sitting on the couch in the depot and watching TV and waiting for a call from the control room.” 32

[55] At least so far as ordinary hours are concerned, DOs and ODSs are entitled to payment for their rostered hours whether they are performing productive work or not, provided that they perform all work allocated to them. There is no evidence that any of the employees the subject of the investigation did not perform any planned or unplanned work that they were directed to perform. Accordingly, to characterise the employees’ misconduct as involving “timesheet fraud” in respect of ordinary hours is misplaced, since there is no logical basis to conclude that the employees gained any financial advantage by starting or finishing work at home. Ausgrid classified some of the employees as having engaged in more serious “timesheet fraud” because their vehicle was located at their home for entirety of a shift, but this simply reflects the fact that no work at all was assigned to them during the shift rather than indicating that they avoided the performance of work or obtained some illegitimate financial advantage by not attending the depot. The position does not appear to be substantially different in respect of overtime, since most overtime is performed in the context of rostered overtime shifts. This was explained in the second witness statement of Kyle Farrar in reply to the witness statement of Mr Stuart Donaldson, Ausgrid’s Head of System Control, as follows:

“In paragraph 80, Mr Donaldson says ‘overtime payments had been claimed for time when the employee was not working’. Planned overtime is scheduled in an eight-hour allotment or a 14- hour allotment to ensure minimum staffing levels. They are entered into the MyTime program as full shifts and are worked as though we are performing a normal shift. As with any shift on a planned overtime shift a DOP may get planned work, emergency work and unallocated time. All of the time I spent at home in the period referred to in relation to planned overtime was ‘unallocated time’. There is no difference in the work that I performed as unallocated time at home and the work that I now perform as unallocated time in the depot. I have not had any financial gain from being home in unallocated time and I was working within the bounds of what I thought was an accepted practice.” 33

[56] One aspect of Ausgrid’s case was that the employees’ conduct had compromised their capacity to respond to unplanned incidents of an emergency nature. However, it appears to us that this was a largely theoretical concern, since there is no evidence of any actual incident where any of the employees had a delayed response to an emergency because of where they were located at the time they were allocated the job. There is no reason to consider that an employee will automatically be in a worse position to respond to an incident in their assigned area if they are waiting to be assigned work at home as compared to waiting for work at the depot. If an employee’s home is within the assigned area, it seems to us to be largely a matter of chance as to whether the employee’s depot or home would be closer to any particular incident. Even where the employee’s home is outside their assigned area, this may not necessarily mean that their response time is compromised. One of the employees, Mr Tom Duffy, gave the following evidence in reply to Mr Donaldson’s witness statement:

“Mr Donaldson states at paragraph 80(b) that the worst case of conduct was times when the employee was out of their work area during shift time. I do reside out of area although my home is directly next to the M2 motorway. Artarmon is my depot. My response times were never bought into question by management or the Control Room. A lot of night shift work tended to centre around the Pennant Hills and Galston area which is a rural area. Rural areas have more unplanned outages, tree strikes etc. From the Artarmon Depot to Pennant Hills my response time is about 16 minutes. From my home it is about twelve minutes. From the Artarmon Depot to the Galston area my response time is 30 mins. My response time to the Galston area from my home is about 22 minutes.” 34

[57] More generally, the evidence was that DOs and ODSs were required to work from home during the COVID-19 pandemic, but this does not appear to have adversely affected response times to incidents.

[58] Second, the process by which the 10 employees were selected for investigation and actual or pending disciplinary action was arbitrary and unfair. We agree with the Commissioner’s finding that the random selection of the period of analysis for each of the 150 employees was, in effect, a “lottery” (to use the Commissioner’s characterisation). This method of selection would not have mattered if the 10 employees, and no one else, had engaged in the relevant misconduct. However, in circumstances where, as the Commissioner found, some 50 -100 of the 150 employees had engaged in varying degrees of conduct in breach of the 2015 memorandum, the selection of random months for analysis inevitably had the consequence that the degree of misconduct disclosed was affected by chance. This is because the amount of time during which employees were identified as being at home during a shift was necessarily affected by the amount of planned work and unplanned incident response work that was allocated to them in the period selected for analysis. This is a significant issue because the degree of the misconduct committed in the period of analysis formed the basis for the selection of the original 11 employees for disciplinary action.

[59] In addition, it is clear that the selection of the employees who were to face disciplinary action was, to a significant degree, driven by the need to “make an example” of someone in respect of non-compliance with the 2015 memorandum without compromising the number of DOs and ODSs Ausgrid needed to meet its business needs. In its appeal submissions, Ausgrid submitted that it had assessed all its employees against the same criteria and that the 11 employees who were selected had engaged in conduct of a different nature or degree, but this submission cannot stand in the face of the following evidence given by Mr Baker, Ausgrid’s own witness:

“There were varying degrees of alleged non-compliance across the 150 people and a line had to be drawn to allow Ausgrid to still meet obligations to provide a safe network (and not impact public safety), but also not to allow the misconduct to go unnoticed. A threshold level where employees with the largest number of hours engaging in the alleged misconduct or engaging in the worst behaviour (such as being out of area while on shift) formed the group of 11 employees that were issued allegation letters.” 35

(underlining added)

[60] The arbitrariness of the number of employees selected for disciplinary action out of the 50-100 who were found to have contravened the 2015 memorandum was also disclosed in the following evidence given by Mr Donaldson:

“Because you’ve got people working for you today, I think it’s fair to say, working for you today who on your evidence have engaged in timesheet fraud so - I withdraw that. On your version of things, have engaged in timesheet fraud, correct?---Yes.

And you’re quite happy to have those people working for you today?---Yes, as long as they’re following the rules.

And they will include, necessarily, people who against whom no disciplinary action at all has been taken?---Some of them, yes.

How do you reckon that sits with the fair culture policy?---The waiting process was used to ensure that we had a fair representation of the type and the magnitude of behaviours that received allegation letters. 36

. . .

They all involve dishonesty on your evidence?---Yes.

And yet, 50 upwards people did not even get a letter about their dishonesty?---Yes.” 37

[61] Mr Baker also gave evidence that, of the approximately 12 ODSs employed by Ausgrid, nearly all of them were subject to “exceptions” (that is, when the investigation revealed that their Ausgrid vehicle was not, during rostered hours, located at either a depot or a job site). Eight of these had a significantly higher number of exceptions, and Mr Baker agreed that the six of these eight who had not been selected for disciplinary action had “all been involved in a significant way in what are described as exceptions, whether they be in respect of normal time hours, overtime hours… and late starts and early finishes”. 38 In respect of these six, Mr Baker gave the following evidence in cross-examination:

“And the people I just named, that is, the people who excluded, Jason Keen and Tapp, didn’t receive any allegation letters?---No.

Indeed, no one - on your evidence, no one even spoke to them about this matter?---No.

Not a word?---No.

You didn’t call them into your office as a manager and say, ‘Look, we had this investigation, and it showed these things about you. We’re not taking disciplinary action, but watch it.’ Did you do anything like that?---Not personally, no.

No. No one did anything like that, personally or otherwise, correct?---No, no.” 39

[62] Mr Baker went on to say, in response to it being put to him that the approach taken by Ausgrid in selecting only two of the ODSs for disciplinary action:

“The information that you’ve tendered there I don’t believe takes into account the ranking of any of the non-compliances. There were varying degrees of non-compliance that the investigation team identified, and these were ranked. And Ausgrid has to balance our risk to public safety and network access, and a decision was made to only take action, with regards to field operating, 10 of the staff.” 40

[63] In unfair dismissal cases, it is a well-established proposition that differential disciplinary treatment of similar misconduct by an employer may be a legitimate basis upon which to find that a dismissal is unfair. 41 The evidence referred to, we consider, shows an entirely illegitimate disparity in treatment of employees who have engaged in what Ausgrid characterises as dishonest conduct: there have been no disciplinary consequences whatsoever — not even a reprimand — for the majority of employees who have engaged in such conduct, while a small group has been selected for significant disciplinary action which for some may extend to dismissal. This disparity cannot be justified by Ausgrid’s assessment of the degree and nature of the employees’ misconduct in circumstances where, as the evidence referred to above makes clear, the actual number of employees selected for disciplinary action was chosen based on the need “not to allow the misconduct to go unnoticed”42 while retaining sufficient field staff at work to meet operational needs.

[64] The third and most significant mitigating matter is that the employees’ conduct occurred within the context of a longstanding workplace culture whereby starting and finishing work at home was tolerated, if not accepted. All of the 10 employees gave evidence to this effect. For example:

•  Mr Galea said that when the 2015 memorandum was issued, his previous manager had told him and the other DOs at his depot that the policy had been put out by the Operating Section to “align themselves with everyone else in the company, for the purpose of justifying the division keeping their vehicles”, 43 that the policy was not enforced and that most DOs continued to stand down at home if they had no scheduled work to do, and that his manager during the period the subject of the investigation participated in conversations where employees discussed whether they had been called out from home during night shifts.

•  Robert Drewett said that, when he was in training to be a DO and working night shifts, he started and finished work at home, his fellow DOs did likewise, his supervisor would often say to him words to the effect of “go get your head down” 44 when he had finished a job, and he would then go home to wait for the next job. When he was assigned to the Castle Cove depot he did not go there much at all but would almost always start on site or wait for work at home. He said that this was “the usual way things were done and no-one [had] ever suggested they should be done differently”.45

•  Mr Coochiroff gave evidence that, during his training period, there was never a requirement that DOs be in the depot at the start of a shift, but simply had to be in their area and contactable by phone from when they dialled into the control room at the beginning of their shift. He also said that when he transferred to the Dee Why area in which he lived, he and all the other DOs living in the area performed their night shifts from home because of the lack of fatigue management facilities at the depot. He also recounted attending a team brief by his manager concerning the 2015 memorandum, at which he and his fellow DOs were told that work “on-site” included “[p]rinting your diagrams, studying the switching, talking to the control room about the job, talking to the engineering officer about the job, your hazard assessment, your vehicle inspections”, 46 from which he concluded that the 2015 memorandum meant that he could start at the depot or on the job, with “the job” including tasks that could be performed at home. As a result, on most days, the site where he started work was at home where he was doing his vehicle inspection, printing work, scheduling, preparing a hazard assessment, reviewing safety rules, and coordinating with the control room.

•  Mr Duffy’s evidence was that, as a trainee, he was aware that some of the DOs would do their night shifts at home, and because he lived close to his depot DOs would occasionally tell him to stay home for a night shift and he would be called if necessary. He described that during his first night shift at the Castle Cove depot, the Area Operator told him: “There’s nothing happening, why don’t you just do it at home?” 47 He also said that once the DOs were issued with mobile phones, the practice after the completion of planned work was to go home or go to a depot provided that DOs remained ready to respond and had their phones with them. Area Operators in the Control Room would say, after the completion of planned work, words to the effect of: “Head for the hills, keep your phone on”, “Keep your phone on, I’ll call you if I need you” or “You’d best get home and get yourself some dinner”.48 Mr Duffy said he began doing night shifts from home in 2017 when he changed his address to be just inside his assigned area.

•  Jason Keen also described a practice in place since he was a trainee DO whereby many DOs would go home and be on standby after the completion of planned work, with the knowledge of Control Room personnel. He said that, if there was no planned work, it was accepted practice to rest or sleep at assigned depots or at home if home was within the operating area. He also described a period during which he worked in the Control Room, and said that DOs were usually allocated incident response work in the area where they lived, and that there was a map which gave the location of each DO’s residence. He also said that when he worked for a period as a Senior DO, he was aware that some DOs were starting from home as this location was more efficient than starting at their assigned depot.

•  Michael Langley similarly described a practice in which Control Room operators were involved whereby, upon the completion of planned work, he would remain in his area available to respond to emergencies but not necessarily at the depot. He said there had never been any suggestion that his work was incomplete because of this practice. He also said that, at the start of a shift, he would always call the Control Room to check on his work for the shift. There were some shifts, especially on public holidays or long weekends when there was no planned work, in which case he confirmed this with the Control Room and was required simply to remain available. He said there was likewise significantly less work on night shifts, and more time was spent managing fatigue or standing by for emergencies, and provided he was in the area there was never an expectation that he remain in the depot while standing by.

•  Scott Obey said that, during his training as a DO (which ran from 2015 to 2018), he was told by his superintendent to forget what he had previously known about procedures and do what he was told by the DOs at the depot. He said that, on night shifts, he was often told to stay home unless needed if there was no planned work to perform, and this was what DOs who lived in the area usually did, to the extent that he never saw some DOs at the depot during a night shift. On the occasions where he stayed at the depot and did not have any work assigned, there were no duties to be performed in the depot and he usually studied, watched television or sat around. At his current depot (at Sefton), the expectation (including that of the Control Room) was that employees would sleep on night shift if there was no work, but the fatigue management facilities at the depot were poor. Mr Obey said it was generally more efficient in preparing paperwork for planned work to do this at home rather than going to the depot to do it.

•  Murray Roach said that his experience when he was a trainee was that DOs were free to plan their day around planned work including their start and finish locations provided they remained in the area and that when he was in his local region, he would start most night shifts from home as there was very little to do and he was generally on standby waiting for a call. Since he was appointed as a DO in 2012, he has generally started work from home and returned home for standby once he had finished his planned work or if there was a couple of hours before his next planned job. He said that the Control Room was aware he was on standby at home, and the Area Operators in the Control Room had all previously been DOs and worked to the same practices. He also said that all his managers had known of the practice of returning home if you lived within your area.

•  Michael Tapp similarly described a practice, both as a DO and an ODS, where he was allowed flexibility as to his location before, between and after planned jobs provided he remained in his area. He said that this practice was known to his managers (who had been DOs) and the Area Operators in the Control Room.

•  Mr Farrar said that, when he was a trainee (and did not have a vehicle), the DOs he worked with would drop him off at the depot after the completion of planned work and go home for lunch or dinner. In respect of the period when he was at the Sefton depot, the facilities were inadequate and filthy and the depot was in an unsafe location. He said that after a man was beaten up outside the depot, his manager told him he did not have to stay in the depot by himself on night shift and he should go somewhere else. Since he moved to the Cronulla depot, he has followed the practices that his supervising DOs observed during his training, and he said that 90% of DOs in his depot did their night shifts from home.

[65] This evidence is entirely consistent with Ausgrid’s investigation disclosing that between 50 and 100 of the 150 DOs and ODSs engaged in the practice described. With respect to those DOs and ODSs whom the investigation did not disclose as engaging in this practice, this may have meant that they were consciously complying with the 2015 memorandum, but it may also simply have meant that, by chance, they did not start or finish at home during the randomly-selected period of analysis or that they did not do this because their residence was not within or close to their operating area.

[66] Accordingly, the evidence firmly supports a finding that there was a practice, known, accepted and sometimes encouraged by managers and Control Room personnel, for DOs and ODSs to start and finish work at home provided they remained available to respond efficiently to unplanned incidents. This practice originated well before the 2015 memorandum but remained in place after it was introduced. That this must operate as a mitigating factor is consistent with Ausgrid’s Fair and Just Culture Policy, which states in respect of “wrong behaviour”:

“Sometimes the behaviour is the product of cultural norms or poor systems – some people simply don’t understand the implications or potential consequences of their (at risk) behaviour:

•  These are also opportunities to learn.

•  There may be some disciplinary response depending on the behaviour, but more likely the response will be focused more on coaching the individual and/or broader team and/or modification of systems.” 49

[67] As earlier stated, Ausgrid determined in respect of six of the 10 employees that their conduct warranted the issue of either a warning or a final warning letter. In the appeal, Ausgrid submitted that the position of the remaining four employees (Mr Galea, Mr Drewett, Mr Duffy and Mr Roach) was distinct from the rest because:

•  Mr Galea engaged in repeated dishonesty in the investigation (in relation to Ausgrid’s request for the return of his phone).

•  Mr Drewett’s vehicle was located at his home or a secondary residential location in Seaforth (outside of his area) for the duration of his rostered shifts. In addition, Mr Drewett travelled outside of his operating area on a Christmas Day and claimed triple time payment for time during which he was outside his area and not working.

•  Mr Duffy’s vehicle was on five occasions located at his home, outside of his area, for the duration of his rostered shifts. On one of these occasions, he signed on to this shift at Kings Cross when his vehicle was located at his home in Seven Hills, and on another occasion he signed on at Erskineville when his vehicle was located at Seven Hills.

•  Mr Roach’s vehicle was located outside his area, at his home, for the duration of three shifts.

[68] We will consider the circumstances of the above employees in turn.

[69] With respect to Mr Galea, we have already described the circumstances of his dishonesty in telling Ausgrid, when requested to return his phone, that he did not have it with him when in fact he did. We accept that Mr Galea’s conduct in this respect constituted misconduct in his employment which warrants some form of disciplinary response. However, his misconduct must be considered in the broader context of investigation as it proceeded against him. Mr Galea worked at Ausgrid’s Sefton Depot from 2000 to 2009 and, during this period, he moved to his current residential address in Cronulla. In 2009, he was moved to the Cronulla depot, which is adjacent to an Ausgrid substation. The depot is only a very short distance from Mr Galea’s home: some 600 metres according to him, or 800 meters according to a Google Maps reckoning which was relied upon by Ausgrid during the hearing. Mr Galea’s evidence was that it takes him about five minutes to walk from his home to the depot.

[70] It is apparent that Mr Galea was one of those to be subject to the disciplinary process because the investigators mistakenly believed he was still located at the Sefton depot during the investigation period. The Sefton depot is approximately 30 kilometres from Mr Galea’s home, and the Cronulla depot, so that it not surprising that Mr Galea was “red-flagged” when the data showed that his vehicle was located at his home on some occasion during shift time. However, at his first meeting with the investigators on 10 February 2021, at which he was accused of timesheet fraud, Mr Galea explained that he worked at the Cronulla depot, not the Sefton depot. He further explained that his usual practice was to leave his vehicle at his home and to walk to his depot and, if he had a call-out, he would return to his home to collect his vehicle. He did this because of issues concerning parking near the depot and complaints from neighbouring residents.

[71] One might have thought that the process in respect of Mr Galea would have ceased at this point. However, he was summonsed to a second meeting on 10 February 2021, at which he was faced with six allegations that, on specified dates, he did not start and finish at the Cronulla depot. This was based on the data showing the location of his vehicle at his home at specified dates and times, notwithstanding Mr Galea’s explanation of his usual practice at the previous meeting. Mr Galea responded to these allegations in writing on 17 February 2021, and generally explained that he was at the depot but his vehicle was parked at his home.

[72] Mr Galea attended a further meeting on 10 March 2021 at which it was indicated that Mr Galea could not have been at the depot at the times he indicated in his response because the depot’s alarm had not been disarmed. He explained in response that there was no alarm at the depot; rather, the alarm was at the adjacent substation.

[73] This was the background against which the meeting of 15 March 2021 was arranged. Ausgrid had confirmed that Mr Galea’s contention that there was no alarm at the Cronulla depot was correct, and this appears to have been the basis of the initial indication by Mr Fernley to Mr Miller that the allegations could not be verified and that the meeting would finalise the investigation. However, there appears to have been a last-minute change of direction, with Mr Galea being requested at the 15 March 2021 meeting to hand over his phone (presumably to obtain locational data from it).

[74] Mr Galea was issued with a “show cause” letter. Surprisingly, this letter not only contained a range of allegations concerning Mr Galea’s dishonesty in response to the request from his phone, it also sustained the original allegations that he had been starting work at home rather than at his depot because Mr Galea had not provided evidence to support his response to the allegations and the mobile phone issue had “cast serious aspersions on your credibility and the veracity of the matters” 50 in his written response to the allegations.

[75] In respect of the original allegations against Mr Galea, they clearly cannot be sustained on the evidence before us. Mr Galea did not, in the investigation, bear the burden of disproving the allegations made against him. He denied the allegations, and the basis for his denial was consistent with the data collected in the investigation and verified at each step of the way. To suggest that his response to the allegations should not be believed merely because of his subsequent dishonesty concerning the mobile phone is a non sequitur and cannot be accepted. Therefore, we find that the evidence does not sustain the proposition that Mr Galea engaged in any contravention of the 2015 memorandum. In this respect, his position is distinct from that of the other nine employees, and the consequence of this finding is that Mr Galea’s dishonesty concerning his phone is not cumulative upon other misconduct and does not thereby place him in a more serious category than the other employees for this reason.

[76] With respect to Mr Galea’s dishonesty concerning the request to hand over his phone, we agree with the Commissioner that this is mitigated by his frank admission of the dishonesty and his contrition. Further, Mr Galea’s account of why he was dishonest, which was not the subject of any real evidentiary challenge, was that he was caught by surprise by the request and driven by a concern about handing over the personal material on his phone. He also gave a complete account as to how he later arranged himself for his personal material to be transferred to a replacement phone, and this again was not the subject of any real challenge. Accordingly, we do not consider that there is any proper basis for a finding that Mr Galea was motivated by a desire to withhold data that might be incriminating in the investigation.

[77] Taking all these matters into account, we do not accept Ausgrid’s submission that Mr Galea’s case falls into a more serious category.

[78] In respect of Mr Drewett, and also in respect of Mr Duffy and Mr Roach, we do not accept that they fall into any worse category because they the data shows that they were at home for the entirety of a shift (as distinct from being at home during the start or end of a shift). That simply reflects the fact that they were assigned no work for the duration of the shift, not that they have somehow avoided doing any work which was otherwise required to be performed. The evidence to which we have access makes it clear that on some occasions, no work will be assigned during a shift, and this may equally occur if the employee attends their depot.

[79] Mr Drewett’s evidence is that his residence is at Seaforth, which is very near the border of the Castle Cove depot area to which he was assigned at the period covered by the investigation. However, he gave evidence that he could be assigned work anywhere from Pennant Hills to Manly, and that he was often assigned to perform work at Dee Why because of the convenience of his residential location, notwithstanding that it is outside his depot area. That being the case, the fact that Mr Drewett’s home is just outside his depot area, so that he could be characterised as having on occasion started and finished work outside his depot area, seems to us not to constitute more than a technical difference in the nature of his misconduct, particularly having regard to the fact that Control Room staff apparently knew of and took operational advantage of this.

[80] In relation to the Christmas Day 2019 episode, we reject the proposition that Mr Drewett “claimed triple time payment” for time that he did not work. Mr Drewett did not “claim” anything; he was rostered to work a shift on Christmas Day and was entitled to the penalty rate payment for that shift whether he was assigned any work or not. Mr Drewett explained that, on that shift, he was assigned work that was actually outside his usual area. Once he completed this job, he was not assigned any further work for the shift. He decided to attend a family Christmas dinner at Kellyville, which was about 15 minutes’ drive outside his area, and he remained on call for the remainder of his shift. As to his reasons for attending the Christmas dinner, he said:

“Family Christmas dinner was supposed to be held in my Ausgrid region, but it was changed last minute to my brother’s house in Kellyville. I normally would not have attended but this was the first Christmas without my father as he has passed away in May 2019. I was there to support my mother who was still struggling with the loss of her husband of 50 plus years.”

[81] Having regard to these matters, we do not consider this incident was in any worse category than other employees who had finished their shift at home once their assigned work was completed. No actual prejudice to Ausgrid arose from the fact that Mr Drewett went to the family dinner rather than returning to the Artarmon depot to wait with no work to do.

[82] Mr Duffy moved to his current Baulkham Hills address in October 2019, which is just outside his depot area but, on his evidence gives him a quicker response time than from his previous residence, which was inside his depot area, because it is closer to the M2 motorway. Accordingly, we do not consider that this by itself puts him in a more serious category. In respect of the allegation that on one occasion he started at Kings Cross when the vehicle was at home, Mr Duffy’s evidence in his second witness statement was that at 10:00 pm, when the shift started, he was at his girlfriend’s house caring for her because she was ill, and he believed he would have told the Control Room that he was running late and heading home. He was ready to commence work at 11:45 pm, but he was not allocated any work at all during the shift. This account, although referred to in cross-examination, was not challenged, and no evidence was adduced to contradict it. In those circumstances, this cannot be characterised as any more serious form of misconduct. In respect of the allegation that (on 27 December 2019) Mr Duffy started at Erskineville, outside of his area, this allegation was not even mentioned, let alone addressed in the witness statement of any other witness and was not raised with Mr Duffy in cross-examination. Indeed, an inconsistent allegation was put to him that, on 27 December 2019, he was located at his home for the entirety of his shift – which he agreed was the case. 51 Accordingly, there is no proper basis upon which any finding can be made in relation to this allegation.

[83] Finally, Mr Roach’s position is very similar to that of Mr Drewett. His residence is located outside of his depot area, but the evidence amply demonstrates that Control Room personnel knew of this and took operational advantage of it by frequently allocating him work that was near his residence but outside his depot area. In those circumstances, we do not consider that his participation in the practice of starting or finishing work at home on occasion was in any more serious category than the other employees.

[84] Accordingly, we do not consider that there is any reasonable basis for Messrs Galea, Drewett, Duffy or Roach to be subject to a more serious disciplinary outcome than that imposed upon the other six employees.

[85] As we have already stated, the contravention of the 2015 memorandum, and Mr Galea’s admitted dishonesty, constituted, in our view, misconduct which prima facie warrants some form of disciplinary response. However, the three mitigating factors we have identified, while not rendering unjustifiable any disciplinary outcome at all, must operate to significantly diminish the severity of any such outcome that might be imposed. In particular, we consider that it would be unconscionable and unjustifiable for any employee to be dismissed on the basis of any matter arising from Ausgrid’s investigation. Having regard to the nature of the employees’ misconduct, the three mitigating factors previously discussed, and the disciplinary outcomes already imposed on six of the 10 employees, we conclude that Ausgrid would be justified in taking disciplinary action against them, but only to the maximum extent of issuing a final written warning. No more serious form of disciplinary action is, in our view, justifiable.

Orders

[86] We order as follows:

(1) Permission to appeal is granted.

(2) The appeal is upheld.

(3) The decision of Commissioner Cambridge issued on 28 April 2022 ([2022] FWC 963) is quashed.

(4) The dispute in matter C2021/1485 is determined by answering the agreed question “Have any of the employees named in the Application to the Commission to deal with a dispute engaged in conduct that would justify Ausgrid taking disciplinary action against any of them?” as follows: Yes, but only to the maximum extent of issuing a final written warning.

VICE PRESIDENT

Appearances:

A Moses SC with J Darams of counsel for the appellant.
R Reitano of counsel for the respondent.

Hearing details:

2022.

Sydney, Adelaide and Melbourne by video link:
6 July.

Final written submissions:

Appellant: 8 July 2022.

Printed by authority of the Commonwealth Government Printer

<PR745849>

 1   [2022] FWC 963

 2   There were initially eleven employees involved, but one had resigned by the time the Commissioner dealt with the matter.

 3   [2022] FWC 963 at [58]

 4   Ibid at [78]-[80]

 5   Ibid at [81]

 6   Ibid at [84]-[85]

 7   Ibid at [86]

 8   Ibid at [91]

 9   Ibid at [93]

 10   Ibid at [94]

 11   Ibid at [95]

 12   Ibid

 13   Ibid at [99]

 14   Ibid at [100]

 15   Ibid at [101]-[102]

 16   Ibid at [103]

 17   Ibid at [105]

 18   Ibid at [106]

 19   Ibid at [108]

 20   Ibid at [109]

 21   Ibid at [110]

 22   Reece v Webber [2011] FCAFC 33, 192 FCR 254 at [47], quoting SCAA v Minister for Immigration and Multicultural and Indigenous Affairs [2002] FCA 668 at [38]

 23   Second witness statement of Paul Galea (23 July 2021) (in Exhibit 1) at [28]

 24   First witness statement of Liam Baker (16 June 2021) (in Exhibit 1) at [46]

 25   Transcript, 24 November 2021, PNs 2393-2396

 26   Ibid, PN 2401

 27   Transcript, 26 November 2021, PN 4930

 28   Transcript, 24 November 2021, PN 2401

 29   [2022] FWC 963 at [106]

 30   Witness statement of Liam Baker (16 July 2021) (in Exhibit 1) at [51]

 31   Ibid at [55]

 32   Witness statement of Toby Coochiroff (18 June 2021) (in Exhibit 1) at [84]

 33   Second witness statement of Kyle Farrar (23 July 2021) (in Exhibit 1) at [39]

 34   Second witness statement of Tom Duffy (23 July 2021) (in Exhibit 1) at [5]

 35   Witness statement of Liam Baker (16 July 2021) (in Exhibit 1) at [44]

 36   Transcript, 25 November 2021, PNs 4416-4419

 37   Ibid, PNs 4451-4452

 38   Transcript, 26 November 2021, PN 4781

 39   Ibid, PNs 4782-4786

 40   Ibid, PN 4805

 41   E.g. Darvell v Australian Postal Corporation [2010] FWAFB 4082 at [21]-[24]; Linfox Australia Pty Ltd v Stutsel [2012] FWAFB 7097 at [32]-[33]

 42   Witness statement of Liam Baker (16 July 2021) (in Exhibit 1) at [44]

 43   Witness statement of Paul Duffy (16 June 2021) (in Exhibit 1) at [29]

 44   Witness statement of Robert Drewett (16 June 2021) (in Exhibit 1) at [4]

 45   Ibid at [12]

 46   Witness statement of Toby Coochiroff (18 June 2021) (in Exhibit 1) at [63]

 47   Witness statement of Tom Duffy (18 June 2021) (in Exhibit 1) at [15]

 48   Ibid at [19]

 49   Applicant’s tender bundle (Exhibit 2) at tab 59, Fair and Just Culture Policy, Annexure A at [8]

 50   Applicant’s tender bundle (Exhibit 2) at tab 49, p 6

 51   Transcript 23 November 2021, PN 1868