Note: Judicial review of this decision 2 December 2011 [2011] FCAFC 155

Note: An appeal pursuant to s.604 (C2011/3207) was lodged against this decision - see Full Bench order dated 12 April 2011 [PR508383] for result of appeal.

[2011] FWA 141

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Fair Work Act 2009
s.394—Unfair dismissal

Giuseppe Villani
Holcim (Australia) Pty Ltd T/A Holcim



[1] Mr Giuseppe Villani was employed by Holcim (Australia) Pty Ltd (“Holcim”) and its predecessors from August 1989 until his employment was terminated on 31 May 2010.

[2] Mr Villani lodged an application for relief pursuant to s 394 of the Fair Work Act 2009 (“FW Act”) alleging that he was unfairly dismissed. The application was referred to conciliation on 23 June 2010, and then for hearing on 6 and 7 September 2010.

[3] Holcim operates an Australia wide business as a supplier of concrete, concrete products and aggregates. 1 Mr Villani was the Man in Charge at the Keilor concrete plant which is one of 11 concrete plants operated by Holcim in Melbourne.2

[4] Mr Grabau of Counsel appeared with permission for Mr Villani and Mr Millar of Counsel appeared with permission for Holcim.

[5] Mr Villani gave evidence on his own behalf and Mr Sargent, Mr Moss and Mr Barba gave evidence for Holcim.

Jurisdiction of Fair Work Australia

[6] There is no dispute that Mr Villani is a person who was protected from unfair dismissal. Further Holcim are not a small business and it was not submitted that Mr Villani had been made redundant. Therefore Fair Work Australia has the jurisdiction to determine the application.

The Evidence

[7] Holcim terminated Mr Villani’s employment because he failed to respond to their correspondence dated 20 March and 19 April 2010; he was in breach of the Holcim Code of Ethics and Business Code (the Code); and his continued employment with Holcim as a Concrete Plant Man in Charge while operating a concrete cartage business for a competitor was seen by Holcim as a conflict of interest and an untenable arrangement. 3

[8] Mr Villani denied that any conflict of interest existed; denied he breached the Code; and denied receiving the letters dated 20 March and 19 April 2010.

[9] The facts in this matter are not significantly in dispute.

[10] Mr Villani entered into a contract with Hanson Australia (“Hanson”) in 2007 to deliver concrete products. In April 2007 Mr Villani set up Villcorp Pty Ltd to manage his investments. 4 On 22 July 2009 his truck was delivered which allowed him to commence performing work for Hanson.5 Mr Villani delivered concrete for Hanson from this date until November 2009 when he appointed another driver to do the deliveries.6

[11] Hanson’s website describes itself as “one of the world’s leading suppliers of aggregates and premixed concrete.” 7 It operates in Melbourne and has a depot in the vicinity of Keilor.

[12] Mr Villani was off work from 31 October 2008 due to illness and was required to take leave of various types in this period. 8 He lodged a WorkCover claim which was rejected. Mr Villani was able to return to work on light duties some time in 2009 but this did not occur.9 He was then placed on long service leave. He was fit to return to work on 15 January 2010 however he was not permitted to return to work without a medical clearance. He obtained a medical clearance to return to work from 8 February 2010 but was not permitted to return as Holcim sought an independent medical assessment. A dispute arose about this and Mr Villani was paid his full pay from 8 February 2010 until the date of the termination of his employment. He did not however perform work for Holcim during this period.10

[13] On 1 March 2010 Mr Sargent, the General Manager of Victoria Concrete for Holcim, and Mr Jeff Moss, the Manager Melbourne Concrete for Holcim, had a meeting with Mr Villani.

[14] The purpose of the meeting was to discuss Mr Villani’s previous refusal to undertake a urine test and the information that Mr Sargent had that Mr Villani was operating a concrete truck for Hanson. 11 Mr Sargent made a file note of the meeting.

[15] Mr Sargent asked Mr Villani if he would take a drug and alcohol test and Mr Villani agreed he would. 12

[16] Mr Sargent asked Mr Villani about a rumour that Mr Villani had purchased a truck and this truck was working under contract with Hanson. 13 Mr Sargent said that Mr Villani responded by saying that it was none of their business and that he had several investments and he did not see why he should disclose this. Mr Sargent says he raised the Code and that he told Mr Villani he had a fiduciary duty to his employer at common law and that there was a conflict between his personal interests and those of his employer. He said he asked Mr Villani another two times whether he had a truck with Hanson and Mr Villani refused to answer. Mr Villani asked him to put his request for information in writing. 14

[17] Mr Villani’s evidence was that Mr Sargent “started asking me personal questions about my financial life and whether I derived incomes from any other places or - which I said to him ‘I don’t think that it’s any of your business. Whether I own properties or whether I have stocks or whatever, I don’t think they’re any of your business. ... If you need those questions answered please put them in writing.” 15

[18] In cross examination Mr Villani denied that he refused to give details of what he was doing with Hanson. He said “They didn’t ask me about Hanson. They asked me whether I had a truck. He first started with what my properties were and that’s where he lost me.” 16

[19] On 2 March 2010 Mr Sargent wrote 17 to Mr Villani about his ownership of the concrete truck. In that letter he advised Mr Villani that Mr Villani had confirmed on 13 December 2007 that he had received and read the Code. Mr Villani was asked to provide details about his business interests and financial interests that are or may be in conflict with his obligations under the Code together with any other submissions that he wished to make as to why he believed his business interests were not in conflict with the Code.

[20] On 10 March 2010 Mr Villani’s solicitor’s replied. In that letter Mr Villani denied being in breach of the Code. He specifically said he was not:

[21] In that correspondence Mr Villani alleged that Holcim were discriminating against him because of his medical condition and were looking for a method of dismissing him from his employment.

[22] On 30 March 2010 Holcim’s solicitors wrote to Mr Villani’s solicitors. 19 In that correspondence it was put that Mr Villani was a director of Villcorp Pty Ltd which had a contract with Hanson. It was put that Mr Villani drove the truck and engaged another driver to drive the truck. It was put that this was a breach of the Code. Mr Villani was again asked to provide the information sought in the earlier correspondence.20

[23] No response was received to this correspondence. Mr Villani in cross examination said he did not receive this correspondence 21.

[24] On 19 April 2010 another letter was sent to Mr Villani’s solicitor by Holcim’s solicitor. That correspondence again requested that Mr Villani provide information about his business and financial interests that are or potentially are in conflict with his obligations as an employee and any submissions about why his business interests were not in conflict with his duties as an employee. That letter noted the lack of response to the 30 March 2010 letter and advised that if a response was not received Holcim would make a determination about Mr Villani’s employment . 22

[25] No response was received. Again Mr Villani said he did not receive the correspondence. 23 Mr Villani’s evidence was that he was in constant contact with his solicitors in this time period but there was no discussion about these letters.24

[26] On 31 May 2010 Holcim wrote to Mr Villani and outlined the history of this correspondence and advised him of the termination of his employment. 25

[27] Mr Villani’s evidence was that no conflict of interest existed. Mr Villani did not have an understanding of the legal concepts of direct and indirect competition, and he did not consider that, in operating a truck and making deliveries for Hanson, he was in competition with his employer. He clearly stated his position in cross examination as follows:

[28] Mr Villani thought that he was entitled to do anything he liked once he had clocked off. 27

[29] Mr Villani gave evidence about his role as Man in Charge. Mr Villani was responsible for the operation of the batching plant which manufactures concrete and fills orders. Mr Villani is not responsible for making sales; he is responsible for ensuring the orders are filled. He does not determine which trucks are used to deliver concrete.

[30] Mr Villani in response to my questions said that he did not tender for work at Hanson. He says they operated a numbered roster system. “Everybody has got a number and you go in order and you get whatever is given out next to you and that’s it.” At Holcim he had no role in choosing which trucks were used as there was a roster system at Holcim. 28

[31] Holcim relied on the competency checklist in the collective agreement as evidence about the work performed by Mr Villani. 29 Mr Sargent also gave evidence of Mr Villani’s detailed knowledge of:

[32] Mr Villani in cross examination denied knowledge of actual customers but accepts that that information was available to him. He denied technical knowledge of the product. His evidence is that he “wouldn’t know what they are using the product for on the site. I wouldn’t know who requested it. I see an order and I complete the order. How it gets there and what the customer intends to use it for, is not really my knowledge.” 31

[33] Mr Sargent gave evidence that in November 2007 a copy of the relevant part of the Code together with a covering memo was sent by email to employees. 32

[34] Mr Villani accepted that he had signed off on a survey in which he acknowledged that he had seen the Code and understood that compliance with the Code was mandatory. However it was his evidence that he did not see the extract of the Code that was attached to the survey. It was his evidence that to access his other emails on the day he had to respond to this email. He said asked his manager Mr Barba what it was about and Mr Barba said “Just tick it all off so you can use your email” and that is what Mr Villani did. 33

[35] Mr Barba’s evidence was that he did not remember saying this to Mr Villani but he did not believe he would have said it. 34

[36] When the Code was put to Mr Villani in cross examination he said he did not know what it meant at the time and still does not know what it means. 35

[37] Mr Sargent accepted that there were drivers who delivered concrete for both Holcim and Hanson but distinguished Mr Villani’s position. It was his evidence that Mr Villani had access to confidential details and information. 36

[38] It was put to both Mr Sargent and Mr Moss in cross examination that Mr Villani’s employment was terminated because of his illness and WorkCover claim. 37 Both Mr Sargent and Mr Moss denied that these were a factor in the decision to terminate Mr Villani’s employment.

Submissions of Villani

[39] The primary submission put on behalf of Mr Villani was that no conflict of interest, either direct or indirect, arose. Mr Villani was not in competition with Holcim and his activities had no detrimental impact on Holcim.  38 Further it was submitted that the failure of his solicitor or union to respond to Holcim’s correspondence should not be sheeted home to Mr Villani.39 Mr Villani’s termination was harsh because he never had a duty to disclose; it was unjust because he was trying to make a living in circumstances where he reasonably believed his position at Holcim was at risk; and it was unreasonable because it related to a fear that he might disclose confidential information.40 Further he was not told that unless he gave up this work his employment would be terminated.41

[40] Mr Villani seeks reinstatement and compensation.

Submissions of Holcim

[41] Holcim rely on three matters to support their submissions that there was a valid reason for the termination of Mr Villani’s employment namely:

[42] The primary submission of Holcim was that Mr Villani was potentially in breach of his common law duty of fidelity to his employer. I asked Mr Millar how a conflict of interest arose given Mr Villani’s description of his work for both Hanson and Holcim. Mr Miller responded that because of Mr Villani’s knowledge gained from his position as Man in Charge he had information that would be valuable for a competitor and he had an incentive to have that information passed on. 43

[43] It was put that Mr Villani’s position involved “an intimate knowledge of my client, its products and its customers and the volumes, prices, projects of the customer, all of which would be dangerous in the hands of a competitor and all of which would be an unacceptable risk should a competitor be seen to have some sort of privileged access to information via Mr Villani’s outside business interest.” 44

[44] He further submitted that while there was no allegation that Mr Villani had passed on information that “[t]here was every reason why my client would feel that it couldn’t entirely trust the man in charge of a concrete plant, because the man in charge was operating a truck for a competitor that was well placed to soak up any work that his plant couldn’t operate or couldn’t complete. The two plants are geographically proximate. They’re both in Keilor. They’re both servicing exactly the same market.” 45

[45] Mr Millar submitted that it was not necessary for the Tribunal to determine if Mr Villani had a contractual obligation to comply with the Code, because he was given a lawful and reasonable direction to comply with the Code and Mr Villani did not comply with the Code. 46

[46] Mr Millar further submitted that Mr Villani was provided with ample opportunity to put his position to Holcim including why he did not consider there to be a conflict of interest. 47 Mr Millar rhetorically asked the question: What else could Holcim have done in this situation given Mr Villani’s lack of response to its requests for information?

Was the termination of employment harsh, unjust or unreasonable?

[47] In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, Fair Work Australia must take into account the following:

s387(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees);

[48] This is a case of alleged misconduct. It was held in Edwards v Giudice 48 that if misconduct is alleged then in deciding whether there is a valid reason for the termination of an employee’s employment the Tribunal must determine whether the misconduct occurred.49

Breach of his common law duty

[49] There is a common law obligation on all employees to avoid conflicts of interest between their personal interests and those of their employer.

[50] The Full Bench in Farquharson v Qantas Airways Limited 50 summarised the common law approach to out of hours conduct by employees.51 Relevantly as formulated by His Honour Spender AJ in Cementaid (NSW) Pty Ltd v Chambers:52

[51] In this case Holcim’s complaint is that, given Mr Villani’s position as Man in Charge, he had access to information which would be useful for a competitor and that by providing services to Hanson via his family company, there was a potential conflict of interest. It was put that “[h]is conduct in driving a truck or even just operating the truck for a competitor from the same locale in my submission is an actual repugnance between his acts and the employment relationship.” 53

[52] While Mr Villani and Mr Sargent described Mr Villani’s roles differently, Mr Sargent was not cross examined on his description of Mr Villani’s position. While I accept Mr Villani’s evidence that he did not have actual knowledge of many of the matters set out in Mr Sargent’s evidence I find that he had, due to his position, the means to access this information.

[53] It is however necessary not just to consider Mr Villani’s work with Holcim but to consider the role he filled at Hanson. Mr Villani, on a roster system, delivered concrete for Hanson. He did not deal with Hanson’s customers apart from delivering their concrete. He did not sell concrete for Hanson nor did he have any involvement with Hanson’s manufacturing process or pricing.

[54] This is not a case where Mr Villani had set up a business which was a potential business rival to Holcim 54 or where Mr Villani’s work with Hanson assisted Hanson make inroads into Holcim’s industry.55 Mr Villani as a truck driver for Hanson or as company director whose truck delivered for Hanson could not in any way impact on Holcim’s business. More would be needed before Mr Villani breached his common law obligations to his employer. Mr Villani would need to actually provide confidential information to Hanson.

[55] It was accepted that Mr Villani had not provided confidential information to Hanson.

[56] So in answer the questions posed by His Honour Spender AJ, I would answer no to all four questions.

[57] This is a case of a mere apprehension that Mr Villani will act in a manner incompatible with his duty to his employer.

Breach of the Code

[58] I accept Mr Villani’s evidence that he did not read the Code before he responded to the email. I further accept that he did not and does not understand the Code.

[59] The Code relevantly provides that an employee must not:

[60] The Code is not expressed in simple language and I accept that Mr Villani did not understand the legal concepts of direct or indirect competition.

[61] Further an employer who relies upon email as the sole method of informing its employees of its policy runs the risk that employees do not understand the material provided and, as a consequence, will not comply with the policy. This is clearly what happened here.

[62] While I accept that, in the circumstances, Mr Villani should not have responded to the survey in the way he did, I accept his evidence that he did so after asking his supervisor about it and being told just to tick it off. Mr Villani’s evidence on this matter was not shaken in cross examination and Mr Barba’s evidence was that he could not recall giving this instruction but said he would not do that. I prefer Mr Villani’s evidence on this matter.

[63] I find that the distribution of a complex policy document by email without any steps being taken by Holcim to ensure that employees actually understand the Code, means that Holcim is not able to rely upon non-compliance with the policy as a basis for arguing that there was a valid reason for the termination of employment.

[64] In any event I find on the evidence before me that Mr Villani did not breach the Code that provided that he not be in direct or indirect competition with Holcim. There was no evidence that Holcim operated a trucking business that sought work from Hanson. I find that Mr Villani’s trucking business was not a direct or indirect competitor. It does not manufacture concrete, it does not sell concrete, it merely delivers concrete.

[65] However he did derive income from a competitor. While Mr Villani stated that he did not understand the use of the word ‘competitor’, I do not accept Mr Villani’s evidence that he did not know that Hanson was a competitor of Holcim.

[66] While the Code does not say it expressly, this part of the Code would prevent an employee from working in any capacity for a competitor. Yet clearly this is not how the Code was applied by Holcim. It was not contested that there were drivers who delivered for both Holcim and Hanson 56. It was also not contested that Mr Villani knew that this was permitted.

[67] I find that Mr Villani did not understand that the Code prevented him from delivering concrete for Hanson. Therefore any breach of the Code was inadvertent.

Failure to respond to Holcim’s correspondence

[68] Whatever Mr Villani’s ignorance of his obligations prior to 1 March 2010. I find that from the meeting on 1 March 2010 he was on notice that the operation of the concrete truck for Hanson was a barrier to him returning to work. I do not accept Mr Villani’s evidence that Mr Sargent did not mention Hanson in the meeting on 1 March 2010. In any event in his letter dated 2 March 2010 Mr Sargent put Mr Villani on notice that the issue was his financial interest in an agitator concrete truck which worked for a competitor of Holcim.

[69] I do not accept that Mr Villani’s solicitor did not advise him of the subsequent letters. This is not consistent with his own witness statement which sets out the exchange of correspondence.

[70] Nor do I consider it unreasonable for Holcim to have communicated with Mr Villani’s solicitors particularly when Mr Villani had requested that communication about this matter be put in writing and Mr Villani’s solicitors advised Holcim that they were acting for him in this matter.

[71] I also find that Holcim were entitled to ask Mr Villani the questions they did and to require him to respond. Mr Villani was wrong in concluding that his business dealings were none of Holcim’s business.

[72] Mr Villani received legal advice about the letter dated 2 March 2010. He knew Holcim were concerned about his work with Hanson. His answer that he did not receive income from a competitor was not true.

[73] Importantly he was provided with three opportunities to put forward submissions about why no conflict arose and he did not do so.

[74] It is unfortunate that Mr Villani did not engage with the issue raised by Holcim. He may have been able to establish to Holcim’s satisfaction that no conflict of interest existed or Mr Villani may have understood Holcim’s concerns and divested himself of the truck as he offered to do at the hearing.

[75] This did not occur, and these circumstances, where the employer has a genuine, albeit arguably misguided, concern about a potential conflict of interest, and the employee refuses to respond to those concerns, leads me to conclude that there was a valid reason for the termination of Mr Villani’s employment.

s387(b) whether Villani was notified of that reason

[76] Mr Villani was notified of the reason for the termination of his employment, namely Holcim’s view that he breached the Code and his common law obligations. However while he was clearly advised that a failure to respond would see Holcim determine the matter on the basis of the information it had, he was not advised that a failure to respond would be a separate reason for terminating his employment. This was only relied upon in the letter of termination.

s387(c) whether Villani was given an opportunity to respond to any reason related to the capacity or conduct of the person;

[77] Mr Villani was provided with a number of opportunities to respond to the Holcim’s concerns.

s387(d) any unreasonable refusal by the employer to allow Villani to have a support person present to assist at any discussions relating to dismissal;

[78] Mr Villani did not request a support person and was represented by his solicitor in this matter.

s387(e) if the dismissal related to unsatisfactory performance by the person—whether Villani had been warned about that unsatisfactory performance before the dismissal;

[79] Mr Villani’s dismissal was not due to unsatisfactory performance.

s387(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

[80] This is not a relevant consideration in this matter.

s387(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal;

[81] This is not a relevant consideration in this matter.

s387(h) any other matters that FWA considers relevant.

[82] I have had regard to Mr Villani’s long length of service. He had worked for Holcim for over 20 years. I have also had regard to the financial position he was in when he commenced performing work for Hanson, though I note that the contract with Hanson was entered into in 2007. I have taken into account his illness and that he did not commence performing this work until he was cleared to return to light duties but was unable to return to work at Holcim. 57


[83] I have found that Mr Villani’s refusal to respond to Holcim’s requests for information or more importantly his refusal to put to Holcim the reasons why conducting his business was not in conflict with his position as Man in Charge was a valid reason for the termination of his employment. I have found that the other reasons relied upon by Holcim do not support a finding that there was a valid reason for the termination of his employment.

[84] I have also found that Mr Villani was not told that a failure to respond to the letters dated 30 March and 19 April 2010 would be an independent reason for the termination of his employment.

[85] In reaching my decision I am required to ensure that a fair go all round is accorded to both employer and employee.

[86] While I have sympathy for Mr Villani I accept the submissions of Holcim that in the face of Mr Villani’s refusal to respond to their concerns they were left them with no option but to act on the information before them and their assessment of the potential conflict of interest and to terminate his employment. In those circumstances the termination was not harsh, unjust or unreasonable and I therefore dismiss the application.



G Grabau of Counsel for the Applicant.

R Millar of Counsel for the Respondent.

Hearing details:



September 6 and 7.

 1   Exhibit R1 at [4]

 2   Exhibit R1 at [7]

 3   Ibid at attachment 10

 4   Exhibit A2 at [7]

 5   Ibid at [11]

 6   Transcript PN 402

 7   Exhibit R1 at attachment 4

 8   Ibid at [12]

 9   Transcript PN 564

 10   Exhibit R1 at [13]-[15]

 11   Ibid at [18]-[20]

 12   Ibid at attachment 5

 13   Ibid at attachment 5

 14   Ibid at attachment 5

 15   Transcript PN 92 - 93

 16   Transcript PN 354

 17   Exhibit R1 at attachment 6

 18   Ibid at attachment 7

 19   Ibid at attachment 8

 20   Ibid

 21   Transcript PN 471

 22   Exhibit R1 at attachment 9

 23   Transcript PN 478

 24   Ibid at 481

 25   Exhibit R1 at attachment 10

 26   Transcript PN 251

 27   Ibid at PN257

 28   Ibid at PN 571-2

 29   Rinker Australia Pty Limited Melbourne Concrete

And AWU Agreement 2007- 2010 AC309296

 30   Exhibit R1 at [7]

 31   Transcript PN 190

 32   Exhibit R1 at [9]

 33   Transcript PN 237

 34   Ibid PN 725

 35   Ibid PN 233

 36   Ibid PN 638

 37   Transcript PN 642-647 and 684-690

 38   Exhibit A4 at [4]-[6]

 39   Ibid at [8]

 40   Ibid

 41   Ibid at [21]

 42   Exhibit R5 at [3]

 43   Transcript PN 849

 44   Ibid at 925

 45   Ibid PN 850 see also submission at PN 852

 46   Ibid PN 896

 47   Ibid PN 854

 48   169 ALR 89

 49   Ibid Moore J at [4] [7] and Marshall J at [40

 50   PR 971685

 51   Ibid [18]-[22]

 52   Unreported decision Supreme Court of New South Wales 12295 of 1994

 53   Transcript PN 895

 54   Blyth Chemicals Limited v Bushnell [1933] 49 CLR 96

 55   Hivac Ltd v Park Royal Scientific Instruments [1946] Ch 169

 56   Transcript PN 638

 57   Ibid PN 563-567

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