[2012] FWA 5012

Download Word Document



Fair Work Act 2009
s.394—Unfair dismissal

Nick Rushiti
Australian Postal Corporation T/A Australia Post



Termination of employment - remedy.

[1] This decision follows an earlier decision of Fair Work Australia, [2012] FWA 2850 [PR522002], which determined that the dismissal of Mr Rushiti from his employment with Australia Post was an unfair dismissal. That decision did not deal with the issue of remedy.

[2] Following the issuing of the earlier decision further hearings were conducted on 20 April and 4 May 2012 at which further evidence was led by both parties and submissions made on the issue of whether any remedy for the unfair dismissal was appropriate and if a remedy was appropriate what should be the remedy.

[3] The relevant provisions of the Fair Work Act 2009 are found in Division 3 of Part 3-2 and are as follows:

[4] The grant of a remedy for an unfair dismissal is not automatic or as of right. It is discretionary.  1

[5] The only constraints on the discretion are those specified in s.390(1)(a) and (b) and s.390(2). The three prerequisites identified in s.390(1)(a) and (b) and s.390(2) have been determined to exist through the earlier decision in this matter.

[6] Once Fair Work Australia is satisfied as to the matters in s.390(1) and (2) there are no other limitations on the exercise of the discretion of Fair Work Australia to decide if a remedy is to be ordered. If Fair Work Australia exercises its discretion to grant an order for reinstatement under s.391 there are no constraints placed upon Fair Work Australia in exercising its discretion to grant an order for reinstatement although there are constraints on the exercise of a follow on discretion to make orders under either or both s.391(2) and (3).

[7] The open discretion granted to Fair Work Australia in relation to both the power to order a remedy and to order the specific remedy of reinstatement is in stark contrast to the powers given to the Australian Industrial Relations Commission under the Workplace Relations Act which provided in former s.654 (previously s170CH) a significant constraint on the making of any order. The key provisions of s.654 are:

[8] The types of orders referred to in s.654(3), (4) and (7) were respectively: an order for reinstatement, an order for continuity of service and an order for remuneration lost, and an order for compensation. Once the Australian Industrial Relations Commission was satisfied that it could exercise its discretion to make an order, then if it chose to consider an order under ss.654(4) or (7) there were additional constraints on the exercise of the discretion similar to the constraints found currently in s.391(4) and s.392.

[9] The plain language of s.390 and s.391(1) make it clear that Parliament intended that the discretion residing in Fair Work Australia to grant a remedy and to grant the remedy of reinstatement is at large. A discretion at large is certainly not open-ended or unfettered.

[10] The effective constraints on the exercise of the discretion to grant a remedy and to grant the remedy of reinstatement would appear to be that the decision would have to be consistent with -

[11] I have taken into account s.3 of the Act and in particular that one of the means of achieving the object of the Act “to provide a balanced framework for cooperative and productive workplace relations that promotes national economic prosperity and social inclusion for all Australians” is by “protecting against unfair treatment”.

[12] I have taken into account that one of the objects in s.381 of the Act is “to provide remedies if a dismissal is found to be unfair, with an emphasis on reinstatement.”

[13] It is clear that the primary remedy in a case of unfair dismissal is reinstatement. As s.390(3) makes clear Fair Work Australia cannot consider the remedy of compensation unless Fair Work Australia is satisfied of two preconditions:

[14] Section 390(3) can only come into play if Fair Work Australia has decided not to exercise its discretion to order the remedy of reinstatement.

[15] Section 390(3) does not have reverse application where Fair Work Australia is considering whether to exercise its discretion to order reinstatement. By this I mean that where Fair Work Australia has decided that a remedy should be granted and is then considering exercising its discretion to order reinstatement there is no requirement that it be satisfied that reinstatement is more appropriate than compensation or even as appropriate as compensation.

[16] Merely because, as occurred in the present matter, both the Applicant and the Respondent addressed both the remedies of reinstatement and compensation, this does not require Fair Work Australia to balance the remedies of reinstatement or compensation when considering exercising its discretion to make an order for reinstatement. To suggest otherwise would require reading words into the Act which simply are not there and are not needed. It is generally impermissible to read words into legislation where the language is clear. 5

[17] The words of Lord Mersey in Thompson v Goold and Co [1910] AC 409 at 420 are still relevant:

[18] Flowing from the above consideration I approach the exercise of the discretion given to Fair Work Australia under Division 4 of Part 3-2 by posing the following question as the necessary start point:

[see flowchart attached which illustrates above]

[19] I now turn to answering the first question.

Is any remedy appropriate in the present matter?

[20] The Respondent contended that no remedy should be given to the Applicant in this matter 6 and the Applicant sought the remedy of reinstatement and in the alternative the remedy of compensation. Whilst the Respondent only briefly referred to this issue in a specific manner the whole substance of the Respondent’s submission was that any remedy was inappropriate.

[21] Notwithstanding the submissions of the Respondent I consider that it would be inappropriate to deny the Applicant a remedy in relation to his unfair dismissal. I have had regard to the reasons for the decision that the dismissal was unfair in considering whether any remedy is appropriate. To deny the Applicant any remedy would in my view merely compound the unfairness of the decision of the Respondent to dismiss the Applicant. It is in my view appropriate to grant a remedy for the unfair dismissal.

[22] Having answered Yes to the first question I now turn to the second question.

Is reinstatement an appropriate remedy?

[23] The Respondent contended that reinstatement was inappropriate. It was put by Mr McKenney for the Respondent as follows:

[24] Each of the three grounds raised by the Respondent needs to be separately considered.

Reorganization of the Transport Hubs

[25] Mr Humble, Manager, Melbourne Metropolitan Hubs Network (MMHN) gave evidence that the ten transport hubs which currently made up the network were gradually being removed from the network and were being placed under a new management structure which was based upon business hubs. Mr Humble indicated that the transport hub where the Applicant had been employed would become part of a separate business hub and that eventually Mr Humble would only have responsibility for 3 transport hubs. Mr Humble’s evidence was that as control of a transport hub was transferred to a business hub then all of the staff of the transport hub, including those on return to work programmes, were transferred from the MMHN to the relevant business hub. Mr Humble also gave evidence that part of the work performed by the Applicant as part of his return to work programme had disappeared. The Applicant had been performing a task which related to assembling data on an aspect relevant to the whole of the transport hub network. This task would no longer be done on a transport hub network basis as each business hub would be responsible for the transport hub within their business hub.

[26] Mr Humble also gave evidence that the original position of the Applicant as a driver had also changed and that now “the driver becomes the front of Australia Post”(PN4808). Mr Humble’s evidence was that this change was achieved on the basis that “we've just gone through some new training with the drivers, and it will be ongoing”(PN4808).

[27] I am not persuaded that the reorganisation that has occurred with the transport hubs and with the duties of drivers is sufficient to make reinstatement an inappropriate remedy.

[28] The evidence is clear that employees in transport hubs who were on return to work programs were dealt with in the same way as employees who were carrying out their normal duties, ie all transport hub staff were placed under the control of the business hub to which the transport hub was attached.

[29] The concept of reinstatement is not limited to reinstatement to the exact position that the Applicant had nor is reinstatement dependent upon the same organisational structure that existed at the time of the dismissal being in existence at the time of the reinstatement. As s.391(1) makes clear reinstatement can be either by:

[30] The very fact that reinstatement can be to another position permits reinstatement in circumstances where, such as in the present matter, a reorganisation of the Respondent’s business may have led to the Applicants pre-dismissal position no longer existing.

Loss of Trust and Confidence

[31] Evidence was given by both Mr Karzons and Mr Humble that they had lost trust and confidence in the Applicant. The Respondent contended that there was such a loss of trust and confidence in the Applicant that reinstatement was inappropriate.

Mr Humble’s evidence was that:

[32] Mr Karzons’s evidence was that:

[33] The evidence of each of Mr Humble and Mr Karzons needs to be put into context. Mr Humble had no confidence in the Applicant yet retained confidence in those employees who had sent the offensive emails to the Applicant. Mr Karzons had only been the Applicant’s direct supervisor for a period of a few months in 2009 well before the issues which gave rise to the dismissal of the Applicant. Whilst I don’t doubt that each of Mr Humble and Mr Karzons hold the beliefs they recounted in their evidence the test in this matter is that as enunciated by the Full Court of the Industrial Relations Court of Australia in Perkins v Grace Worldwide (Aust) Pty Ltd:

[34] The Respondent relies on the evidence of Mr Humble and Mr Karzons as establishing that the Respondent has lost trust and confidence in the Applicant. It does not appear to me that the Respondent’s position is soundly or rationally based. The loss of trust and confidence in the Applicant appears directly attributable to the fact that the Applicant got caught sending offensive emails and that he admitted doing so. The Respondent appears to have discounted both the obvious regret of the Applicant for his conduct and his clear intention not to repeat such conduct as well as the fact that those employees who sent the offensive emails to the Applicant remain employed with the Respondent because they neither got caught nor made admissions.

[35] I am satisfied that there can be and should be sufficient trust in the Applicant to make the employment relationship viable and productive. The likelihood of the Applicant accessing or sending offensive emails in the future would appear to be remote.

The Applicant’s compensation status

[36] The Respondent contended that the capacity of the Applicant to perform work was relevant when considering the appropriateness of reinstatement.

[37] The contentions of the Respondent lose much of their impact when all of the circumstances of the case are taken into account. The very fact that other employees on return to work programs within the transport hub network have continued to be employed when their transport hub has been placed under the management of a business hub suggests that even in the reorganized business hub model there are return to work opportunities for employees. As the Applicant was an employee of the Respondent it is proper to consider the appropriateness of reinstatement from the perspective that the Respondent has a very large business in Melbourne and one which is much larger than the transport hub network where the Applicant was originally employed as driver and subsequently employed on a return to work program.

[38] Whilst the capacity of the Applicant to perform work was clearly identified through the evidence in this matter the actual work that may be performed by the Applicant if he is reinstated will be that determined by the Respondent’s return to work experts. The evidence relied on by the Respondent does not establish that there is no possibility of the Applicant being employed anywhere within the Respondent’s Melbourne business on a return to work program.

[39] I consider that reinstatement is an appropriate remedy in this matter. Although having regard to the evidence about the restructuring of the transport hub network it would appear that reinstatement of the Applicant should not be to the position in which the Applicant was employed immediately before the dismissal, but rather should be to another position on terms and conditions no less favourable than those on which the Applicant was employed immediately before the dismissal.

[40] An order for reinstatement is an appropriate remedy in this instance.

[41] Having answered the second question Yes I now turn to consider the appropriateness of orders under s.391(2) and (3).

[42] Reinstatement without an order to maintain continuity or an order to restore lost pay would have the effect of punishing the Applicant with a loss of 13 months pay and recognition of service for that period.

Order to maintain continuity - s.391(3)

[43] Having regard to all of the circumstances of this case I consider it appropriate that the continuity of the Applicant’s employment be maintained but that the period between the date of dismissal and the date of reinstatement not count for the purposes of continuous service.

Order to restore lost pay - s.391(4)

[44] I consider that an order to restore lost remuneration should be made. I do not think it appropriate to discount the amount of lost remuneration for any of the reasons advanced by the Respondent. The order I will make will have the effect of requiring the Respondent to pay to the Applicant an amount equal to the amount of remuneration lost by the Applicant from the date of dismissal to the date of reinstatement. I note that the Applicant will be obliged to repay to the Respondent amounts included in his termination pay which related to the paying out on termination of accrued leave entitlements.

[45] An order as to reinstatement and orders as to continuity of service and restoration of lost pay will be issued separately with his decision.



D. Dwyer and D. Khatab, CEPU, for the Applicant

M. McKenney of Counsel for Australia Post

Hearing details:

April 20
May 4

Attachment A

ders flowchart.jpg

 1  Ellawala v Australian Postal Corporation, Print S5109 at pn 24 and 26, Ross VP, Williams SDP, Gay C; Re Australian Industrial Relations Commission; Ex parte Smith [2004] FCAFC 271 at pn 50, per Lee, Goldberg, Weinberg JJ.

 2   Padfield v Minister of Agriculture, Fisheries and Food [1968] AC 997, per Lord Reid at p.1030; Wu v The Queen [1999] HCA 52, per Kirby J (dissenting) at pn 70 and 71

 3   Associate Provincial Picture Houses Ltd v Wednesbury Corporation [1947] 2 All ER 680, [1948] 1 KB 223, [1947] EWCA Civ 1, per Lord Greene MR

 4   Barach v University of NSW [2010] FWAFB 3307 at pn 16

 5   See the discussion in Statutory Interpretation in Australia, Pearce and Geddes, 7th edn at 2.32 - 2.36

 6   Transcript of proceedings at PN4783

 7   Ibid at PN4657

 8   Ibid at PN4807 - PN4808

 9   Ibid at PN5128 - PN5129

 10   [1997] IRCA 15

Printed by authority of the Commonwealth Government Printer

<Price code C, PR525078>