[2018] FWC 250
FAIR WORK COMMISSION

DECISION


Fair Work Act 2009

s 394—Unfair dismissal

Jarrod Eather
v
Whitehaven Coal Limited t/a Narrabri Coal Operations
(U2017/4569)

DEPUTY PRESIDENT SAMS

SYDNEY, 11 JANUARY 2018

Termination of employment – underground mine worker – summary dismissal for serious misconduct – application for reinstatement – alleged breaches of employer’s drug and alcohol policy – random drug testing – positive drug detection result – second positive drug detection result – different ‘cut off’ levels – applicant claimed he was confused by the policy and management directions – conflicting evidence – denial of conduct – applicant’s claim of minimal drug use improbable – belated claim of cannabis use for pain relief – harshness of dismissal – applicant in breach of employer’s policy – serious risk to his own and other employee’s safety – no procedural unfairness – dismissal neither ‘harsh, unjust or unreasonable’ – application dismissed.

[1] Whitehaven Coal Limited (‘Whitehaven’) operates an underground coal mine near Narrabri, New South Wales (‘the mine’). The mine employs around 370 employees. As the only underground mine in the area, it is a major employer in the region. Mine employees are required to operate heavy machinery and other complex equipment, including diesel and drilling equipment, and driving shuttle cars. It is trite to observe that underground coal mining is an inherently dangerous industry, with strict safety rules and regulatory oversight. Unsurprisingly, in this context, all employees at the mine are subject to random drug and alcohol testing and the employer has a detailed and comprehensive policy known as ‘Whitehaven Coal (WHC) Standard – Alcohol and other drugs’. I shall come back to this policy in due course.

[2] Mr Jarrod Eather had worked at the mine since 4 October 2011 (under its previous operator), and had been employed by Whitehaven since 19 December 2013. Mr Eather was born and raised in Gunnedah. He is 42 years old. He and his partner (who does not work) have six children ranging in age from 9 to 16 years old. His parents and extended family all reside in the local area. Mr Eather was employed as an underground production mine worker, under the terms and conditions of the Whitehaven Underground Operations Enterprise Agreement 2012 [AE895322] (‘the Agreement’). Mr Eather’s remuneration per week was around $3,365.41.

[3] On 12 April 2017, Mr Eather was summarily dismissed for serious misconduct after a positive test result for THC (cannabis) on 6 April 2017. His letter of termination was expressed as follows:

‘We refer to the disciplinary meeting with you held on Thursday 06th April 2017 where you were issued with a formal warning letter concerning your breach of the Whitehaven Coal Drug & Alcohol Standard, and where you were advised of the requirement to submit to a further drug test to prove your fitness for work.

The test sample you provided on 06 April 2017 was analysed by SafeWorks Laboratories and the final result was a “Positive” test for Delta -9-THC-COOH (ug/18) You were presented with the final test result at our meeting today 12 April 2017.

You were advised the “positive” test result constitutes a second serious breach of the Whitehaven Coal Alcohol & Drug Standard and may result in the termination of your employment. You were asked to provide an explanation for the breach before a final decision regarding appropriate disciplinary action is made by management.

We have considered the explanation that you have provided to us in relation to this incident. However, due to the seriousness of the breaches and the potential health and safety consequences of your conduct, the decision has been made to terminate your employment with immediate effect for serious misconduct.

In accordance with your employment contract, and clause 11.2(a) of the Enterprise Agreement, you are not entitled to any notice. Your last day of work is Wednesday 12th April 2017.

Payment for any accrued entitlements will be made to your nominated account within seven working days.’

[4] On 27 April 2017, Mr Eather (hereinafter referred to at the ‘applicant’) filed an application, pursuant to s 394 of the Fair Work Act 2009 (the ‘Act’), in which he seeks orders from the Fair Work Commission (the ‘Commission’) for reinstatement and lost remuneration. He claims his ‘dismissal was unfair as there was no conduct on my behalf that justified my termination of employment’.

[5] In accordance with my usual practice, I conducted a telephone conference with the parties on 18 July 2017. However, given that Whitehaven (hereinafter referred to as the ‘respondent’) strenuously resisted the applicant’s claim for reinstatement and as this was the only remedy the applicant sought, the matter was listed for arbitration in Tamworth with directions issued for the filing and service of witness statements and outlines of submissions.

[6] At the hearing on 23 August 2017, Mr K Endacott, Industrial Research Officer of the Construction, Forestry, Mining and Energy Union – Mining and Energy Division, Northern Mining and NSW Energy District Branch, appeared for the applicant and Mr A Britt of Counsel, with Mr A Bland, Solicitor, BlandsLaw, were granted permission pursuant to s 596 of the Act (not opposed by Mr Endacott) to appear for the respondent. At the parties’ request, final submissions were heard in Sydney on 29 September 2017.

THE EVIDENCE

[7] The following persons provided statements and oral evidence in the proceedings:

  Mr Matthew Hall, Safety and Training Coordinator for the respondent;

  Mr Peter Taylor, HR Superintendent for the respondent;

  Mr Gerald Linde, Mine Manager for the respondent; and

  the applicant.

Documentary evidence

[8] Mr Britt tendered the following documents in support of the respondent’s case:

  United States National Highway Traffic Safety Administration Drugs and Human Performance Fact Sheet;

  Pathology Toxicology Report by Douglass Hanly Moir; and

  Whitehaven Coal Standard – Alcohol and other drugs (last revised 11/4/2016) (the ‘Company Standard’).

[9] I shall return to the details of these documents when they were referred to in the cross-examination of witnesses and when I later come to my consideration of the issues in this case.

Mr Matthew Hall

[10] Mr Hall was Acting Safety and Training Superintendent in March 2017. On 15 March 2017, during the afternoon shift, he was informed that the applicant had recorded a ‘non-negative’ result for THC following a random drug test using a site screening cup method. Under the respondent’s process, the employee is stood down and driven home. When Mr Hall drove the applicant home, he did not seem surprised about the test result, and had said ‘Yeah I’ve had a smoke recently.’ During the trip, the applicant asked, ‘what happens now?’ and Mr Hall offered to send him a copy of the Company’s rules and procedures. Mr Hall denied telling the applicant he did not know what would happen next.

[11] Mr Hall said he was aware the applicant had a history of using marijuana, as he had admitted this to him in 2014. Mr Hall attached to his statement a referral from the Gunnedah Health Centre, dated 17 April 2014, which had the following entry:

Other social history:

Regular marihuana [sic] use. Beer – schooners 3 some days.’

[12] Mr Hall spoke to the applicant by phone on 20 March 2017 to ask if he wanted to take annual leave or leave without pay, while stood down. The applicant acknowledged receipt of the Company Standard.

[13] On 23 March 2017, Mr Hall received the Safe Work Laboratories (‘Lab’) results from the sample taken from the applicant on 15 March 2017. He informed the applicant the positive result was 65 g/L, while the Standard cut-off was 15 g/L. Under the Company Standard, the applicant had three weeks to return a negative result.

[14] On 27 March 2017, Mr Hall phoned the applicant. When the applicant said he was unsure if the second test result would be positive or negative, Mr Hall offered for him to come in to self-test using the screening cups. The applicant did so the next day. The applicant queried why the cut-off was 15 g/L, when the onsite screening cup test cut-off was 50 g/L. Mr Hall explained that onsite screening can only detect THC levels above 50 g/L. However, the cut-off is 15 g/L if the onsite cup test is sent to the Lab for follow-up analysis. The Company Standard requires a second test result under 15 g/L, before an employee can return to work.

[15] The applicant undertook a self-test on 28 March 2017, which returned a non-negative result. This sample was sent to the Lab for confirmation. Mr Hall denied telling the applicant that if he passed the self-test screening, he could return to work. The Company Standard requires all further tests to go to the Lab for confirmatory testing. This was always going to be the case. The applicant had told him he had been self testing at home. Mr Hall agreed he gave the applicant some screening test cups to take home to save him buying them from the chemist.

[16] On 3 April 2017, Mr Hall received the Lab test results from the screening test of 28 March 2017. It recorded a 48 g/L result. Mr Hall confirmed the Company Standard requires that an employee must present for work within three weeks of the first positive result, at which time the employee must return a negative result. Mr Hall believed the applicant knew he had to provide a negative result after three weeks of being stood down.

[17] The applicant returned to work on 6 April 2017 and undertook a further test. He also attended a meeting that day with Mr Hall, Mr Linde and the applicant’s support person Mr Nic Lidwinski. The applicant was informed that his test result that day would be referred to the Lab. If the result was negative, he could return to work; if the result was a second positive (over 15 g/L), there may be further disciplinary action. Mr Linde handed the applicant a warning letter which read:

‘This letter serves as a formal written warning concerning your breach of the Company’s Alcohol and Other Drugs Policy Standard.

This letter has been given to you at our meeting today 06/04/2017, the purpose of which was to discuss your serious breach of the Whitehaven Group Alcohol and other Drugs Policy Standard which includes the following:

On 15/03/2017 you provided non-negative drug screen test results for Delta -9-THC-COOH following an onsite random drug test. In accordance with Alcohol and other Drugs standard your sample was sent a pathology lab for confirmatory analysis The final test result following analysis by SafeWork Laboratories was Delta -9-THC-COOH (65 g/L) The cutoff concentration under section 5 of AS/NZ 4308:2008 is 15 g/L. You have therefore returned a “POSITIVE” result which is in breach of the Whitehaven Coal Group Alcohol and other Drugs standard

Breaches of the companies [sic] Alcohol and Drug Standard have the potential to affect the health and safety of the workplace and will not be tolerated. We operate in a dangerous and demanding environment. You have a key responsibility, along with everyone else in the company, to contribute to the promotion of a safe and healthy workplace. Your breach of the Alcohol and Drug Policy constitutes a failure of your responsibility and a serious risk to yourself and to other workers [sic] safety.

As advised by Safety department and in accordance with the Alcohol and Drugs Standard you are required to undertake a further drug screening test today, to determine your fitness for work. The test sample will be referred to SafeWork Laboratories for analysis.

If the laboratory result is negative then you will be allowed to return to your normal duties. If the result is a second positive test then you will be subject to further disciplinary action, which may result in the termination of your employment’

[18] After Mr Linde read the letter, the applicant said he understood its contents and he was very sorry. The 6 April 2017 screening cup test initially returned a negative result, but when referred to the Lab, it disclosed 18 g/L. Mr Hall said he had no further involvement in the matter.

[19] In a reply statement, Mr Hall denied telling the applicant that the respondent was only going to rely on the screening cup test. Subsequent tests were always going to be sent to the Lab. Mr Hall insisted he never told the applicant, or gave him the impression, that he could return to work if he passed the screening cup test. He denied telling him to be prepared for the night shift if he passed the test, because the applicant would have been on day shift.

[20] In cross-examination, Mr Hall was referred to cl 3.2 of the Company Standard, which provides as follows:

3.2 COMPANY REQUIREMENTS

No worker may work at Whitehaven Coal where their fitness for work may be adversely affected by the presence of alcohol or other drugs.

For the purposes of this standard, the current prescribed limit for alcohol is 0.00 grams of alcohol per 100ml of blood.

For the purposes of this standard the current prescribed limit for other drugs is as detailed in AS/NZ 4308. Presently these are:

Substance

Micrograms/litre

Cannabis metabolites

50

Opiates

300

Benzodiazepines

200

Cocaine metabolites

300

Methyl amphetamines

300

If a screening test exceeds these levels, it is then tested using an accredited laboratory that provides the final confirmatory result. AS/NZ 4308:2008 sets out the confirmatory test cut-off levels.’ (My emphasis)

Mr Hall said that despite the 50 g/L referred to in the chart, the cut-off levels are the confirmatory standard mentioned in the last sentence above, being cut-off levels of 15 g/L.

[21] Mr Hall’s evidence was that the two different ‘cut-offs’ are to be read in conjunction with cl 3.7 of the Company Standard, which states:

3.7 RETURN TO WORK FOLLOWING A NON-NEGATIVE TEST OR POSITIVE TEST

Any worker returning a result above the prescribed limit for alcohol, or at, or above, the prescribed limits for other drugs, will be required to submit to another screening test for alcohol or other drugs upon returning to work. If the test results are negative, they may be allowed to resume normal duties. This may occur prior to the results of an accredited testing laboratory confirmation testing being available.

Upon returning to work the worker must provide a negative result and the worker must demonstrate, to the satisfaction of the manager that they are fit for work. Whitehaven Coal will arrange for the testing to occur at work. The worker must present for work within a 3 week time period for testing to occur.

Subsequent positive results, after the initial positive result, will be considered in the disciplinary process.’

[22] Mr Hall explained that when the applicant presented for work on 6 April 2017, he returned a non-negative result (48 g/L) on the screening cup measure. However, cl 3.7 requires all testing subsequent to a first positive result to be sent to the Lab for confirmation of the results. Mr Hall acknowledged that the cut-off of 15 g/L is not mentioned anywhere in the Company Standard. Nevertheless, it is well understood to be the 2008 Australian Standard.

[23] Mr Hall denied the suggestion that the applicant was forced to self-test. He had offered him self-testing, knowing the applicant was doing it at home anyway. He had initially called him to discuss what leave he would like to utilise while being stood down. (He took annual leave for the stand-down period.) Discussion then turned to his doubts as to whether he would pass any future tests. Mr Hall recalled the applicant being unsure about the line measurements of the screening cups. Mr Hall insisted the applicant took a number of testing cups home with him on 28 March 2017. They were not forced on him. In fact, he offered them to save him money, by not purchasing them from the chemist. While Mr Hall understood the screening cup test would not detect below 50 g/L, at this time, the applicant was using the cups and still testing above 50 g/L. Mr Hall insisted he never told the applicant if he passed the screening cup test he could return to work. Rather, the applicant was unsure if he was under the higher cut-off anyway, and he was not.

[24] Mr Hall denied not telling the applicant the pass level was under 15 g/L. Mr Hall was referred to cl 3.5.2 of the Company Standard, which reads:

3.5.2 MANAGEMENT OF OTHER DRUGS TEST

Where a drug other than alcohol is detected as a result of an initial screening test, a sample will be prepared and dispatched to an accredited testing laboratory for confirmatory analysis in accordance with AS/NZ 4308:2008.

The worker and their supervisor will be informed of the test result. The worker will not be permitted to commence or return to work for the remainder of that shift. The worker will be offered transport to their accommodation.

Refusal to be transported home may be treated as serious misconduct, [sic] If the person does refuse to returned home when the test result is above the cut-off limits the police will be notified.

Where a non-negative result is returned and it is consistent with a worker’s declaration of prescription medication (which occurs after the test), then the supervisor will make a fitness for work assessment. The fitness for work assessment will made by the supervisor must take into consideration any medication declared that may adversely affect the worker’s fitness for work. In determination of the workers’ [sic] fitness for work, the Supervisor may consult with relevant personnel such as the Health and Safety team who may arrange for further assessment and opinion from a Medical Practitioner or relevant Health Professional. If, in the supervisor’s opinion, the worker is fit for work they may return to work and resume normal duties. If in the supervisor’s opinion the worker is unfit for work or further information is required, they will not be permitted to commence or return to work for the remainder of that shift. The worker will be offered transport to their accommodation.

That laboratory analysis will either confirm a positive result or indicate a negative result. If a positive result is recorded, the worker will be managed in accordance to section 3.6.

Where it is confirmed by an accredited testing laboratory analysis that the test results are consistent with the declared prescription medication in type and quantity, then the test will not be deemed or recorded as positive.’

Mr Hall confirmed that this clause demonstrates that Whitehaven does not have a zero tolerance policy towards drugs. This is so because an initial positive result means that the employee has three weeks to return a negative result. However, the first result remains on the employee’s personnel file for five years. Mr Hall believed the first positive result was confirmed, in writing, to the applicant.

[25] Mr Hall said that when the applicant presented on 6 April 2017 and failed the test, he was being dealt with under cl 3.7 of the Company Standard, which meant he had to return a negative result. He agreed the 6 April 2017 result was 18 g/L. If he had been tested using the screening cup test, it would not have detected the presence of cannabis. Mr Hall accepted he did not give a copy of this report to the applicant.

[26] In answer to queries from me, Mr Hall said that if an employee says ‘I feel I can’t pass the test in three weeks’, it would be regarded as a failure to provide a sample according to the Company Standard (which uses the word ‘must’). Mr Hall acknowledged that the applicant’s results were on a downward trajectory from 65 to 48 to 18 g/L over three weeks. However, Mr Hall understood that an employee would not be allowed a further week to get below 15 g/L.

Mr Peter Taylor

[27] It was Mr Taylor’s evidence that the respondent takes a number of steps to ensure that its policies and procedures, including the Company Standard, are up to date and available to all employees. These include:

  all policies and procedures are available to all employees on the respondent’s intranet;

  at inductions for every employee and contractor, the training includes specific information about the Company Standard, the random drug and alcohol testing using site screening tests, that these tests are indicative only and drug and alcohol tests may be confirmed by laboratory testing;

  after induction, every employee must acknowledge having been taken through the drug and alcohol policy (the applicant acknowledged this on 4 October 2011);

  test results remain effective for five years;

  there is a specific procedure for an employee being permitted to return to work following a non-negative or positive result;

  each positive result is a cause for disciplinary action;

  employees are advised of, and must acknowledge that they have viewed, any updates or changes to policies (the applicant acknowledged he had viewed an update to the drug and alcohol policy on 19 March 2013); and

  Tool Box meetings also focus on Company policies. One such meeting on 12 January 2017, attended by the applicant, dealt with synthetic drug testing being included in random drug testing.

[28] Mr Taylor set out his understanding of the processes where a screening cup test returns a non-negative result, above 50 g/L. The sample is then forwarded to the Lab for confirmatory testing according to the AS/NZ Standard. After Mr Hall advised Mr Taylor of the applicant’s non-negative result on 15 March 2017, he and Mr Linde discussed the issue. They agreed it was a straightforward matter to be dealt with under the Company Standard.

[29] Mr Taylor set out the following conversation with the applicant on 3 April 2017 after he became aware that the applicant’s latest Lab result, of 28 March 2017, was 48 g/L:

‘[Mr Taylor:] Hi Jarrod it’s Peter Taylor here. I’m calling you because this is a serious HR matter and you have already breached the safety standard. The self-test is still showing positive. If you come in for the three week test you need to be able to show a clear result.

[The applicant:] Yeah I know.

[Mr Taylor:] Matt gave you a copy of the policy didn’t he?

[The applicant:] Yeah

[Mr Taylor:] You could lose your job if you return a second positive test – it’s still at a pretty high level.

[The applicant:] Yeah I understand that. I’m running and drinking lots of water to try to get it out of my system.

[Mr Taylor:] When you come in it will be the same process – you will take the screening test and it goes off to the lab. If it’s positive you could lose your job.

[The applicant:] Yeah I’m hoping I’ll be right.’

[30] After the applicant returned a final positive test result on 6 April 2017, Mr Taylor and Mr Linde met with the applicant and his support person, Mr Tom Quartermass, on 12 April 2017. Mr Taylor and Mr Linde had agreed there was a valid reason for the applicant’s dismissal, unless he could provide a response or reason for the positive test.

[31] It was Mr Taylor’s evidence that when the applicant was asked for his response, he blamed Mr Hall for telling him that if he passed the screening cup test, he could go back to work. Mr Linde believed the applicant knew the test result would be sent to the Lab, and if it was positive, he could be dismissed. The applicant responded that it was only a bit over 15 g/L, he had six kids and could not afford to lose his job. Mr Taylor told him that his children were not the issue. After Mr Linde asked him again to explain his position, the applicant replied:

‘I am a good employee, Matt Hall said I would be fine, I have responsibilities with a large family.’

[32] Mr Taylor and Mr Linde left the room to discuss the applicant’s response. They returned to inform him he would be dismissed for serious and wilful misconduct.

[33] In a reply statement, Mr Taylor rejected the applicant’s version of their conversation on 3 April 2017 (see para [29] above). He agreed the applicant had said he was running and drinking water, hoping that he would be OK. Mr Taylor said that at no point did the applicant mention using marijuana to manage pain from a work-related injury.

[34] In cross-examination, Mr Taylor said he had understood the applicant was verbally (not in writing) advised of the 15 March 2017 result before the 6 April 2017 meeting. This was because he was stood down and not at work. Nevertheless, a copy of his results was given to him on 6 April 2017. Mr Taylor agreed that the Company Standard was not a zero tolerance policy. It was more like a ‘two strikes’ policy.

[35] Before the 6 April 2017 meeting, Mr Taylor was aware the applicant had been self-screening with cups given to him by Mr Hall. Mr Taylor said that when he spoke to the applicant on 3 April 2017, he told him the sample would be sent to the Lab. He could not recall if he mentioned the 15 g/L cut-off. Mr Taylor agreed that the 15 g/L cut-off is not mentioned in the Company Standard, but the reference is to the 2008 Australian Standard, which could become zero if the available technology could detect THC levels lower than 15 g/L.

[36] Mr Taylor acknowledged that while the figure of 15 g/L was mentioned in the 6 April 2017 warning letter, there was no document given to the applicant prior to then, which referred to the 15 g/L cut-off. However, he believed the applicant was told about it when the result came back. The intention had been to give the applicant the warning letter before he undertook the test, but the tester turned up early and the timing was reversed. Mr Taylor found out about the first test result (65 g/L) on 23 March 2017. The warning letter was not issued at that time because the applicant was stood down and therefore not at work.

[37] While Mr Taylor understood the applicant was self-testing during the three-week stand-down period, the applicant had said that ‘Matt told me it would be fine.’ The applicant did not say he attended on 6 April 2017 because he was returning negative results (with the cups) and thought he was fine to return to work. Mr Taylor had told him it did not really matter what Mr Hall had said; the issue was the second test was above the National Standard. Mr Taylor denied there was a pre-prepared termination letter before the 12 April 2017 meeting. It was a template in the respondent’s system which he later amended and finalised.

[38] Mr Taylor rejected the applicant’s evidence that he was unaware of the purpose of the disciplinary meeting. He knew, and Mr Taylor had told him, that if he returned a second positive result then he may be terminated. Mr Taylor said there were two breaks in the disciplinary meeting - not one as claimed by the applicant. In the second break, Mr Taylor finalised the termination letter on his computer.

[39] Mr Taylor acknowledged that in his time with the respondent, no other employee had failed a second test, notwithstanding many employees’ samples had been sent to the Lab for confirmation. These employees had received warnings which remained ‘active’ for five years.

[40] Mr Taylor emphasised the seriousness of the applicant’s conduct. It was never the case that employees who tested below 50 and above 15 g/L could simply go back to work. The onsite technology prevented the respondent from knowing if the level was below 50 g/L. If the technology changed, the policy would change. The screening cup tests only show results above 50 g/L, and every sample above that goes to the Lab to get an accurate result. If there was a non-Lab measure to test for the 15 g/L cut-off, the respondent would use it. However, at the present time, it is not practical to send every result to the Lab.

[41] Mr Taylor accepted that it was possible, if the applicant had more time, and had not used cannabis again, his result may have gone below 15 g/L. While he recognised a descending trajectory in the three-week stand-down period, it was not enough. The three week period was mandatory.

[42] Mr Taylor understood the applicant had two earlier verbal warnings, which were on his personnel file. These warnings were not included in the respondent’s evidence. In re-examination, Mr Taylor was shown the earlier warning letters dated 16 September 2014 and 23 December 2014, one of which had been signed by the applicant as a verbal warning.

[43] In answer to my question, Mr Taylor said that if the respondent had a reasonable belief that someone was above 15 g/L, but had tested negative in the on-site cup screening, the sample could still be sent to the Lab for confirmatory testing.

Mr Gerald Linde

[44] In his statement, Mr Linde described the operations of Whitehaven and set out the information conveyed to him about the applicant’s drug screening test on 15 March 2017 and its confirmation at 65 g/L. Mr Linde attended the two meetings with the applicant and his support person on 6 and 12 April 2017.

[45] Mr Linde’s version of the conversation on 12 April 2017 was as follows:

‘[Mr Linde:] Jarrod, the lab has returned a positive result of 18 g/L against a cut off level of 15g/L. This is a breach of the policy and your second positive result. This is a show cause meeting as to why your employment should not be terminated.

[The applicant:] Well Matt told me it was all ok and it was about the urine cups and if I passed that I could come back. I have six kids and I can’t afford to lose my job.

[Mr Linde:] You had a copy of the policy and in accordance with the policy you have returned a second positive result at the time required being three weeks to return to work. We are considering termination of employment based on breach of mine health and safety standard – I would like you to explain why we should retain your employment?’

[46] After an adjournment of five minutes, the applicant said:

‘Matt Hall said I would be fine. I am a good employee, better than those others. I have responsibilities with a large family.’

After a second adjournment, the applicant was dismissed.

[47] It was Mr Linde’s evidence that given his positive results for illicit drug use, if the applicant was reinstated he would pose a risk to the health and safety of all employees. It would demonstrate to employees and the general public that the respondent does not follow its own policies or adhere to its zero drug tolerance.

[48] In a reply statement, Mr Linde said that the termination letter was not given to the applicant until after the second break in the 12 April 2017 meeting. Mr Linde said he made it clear that the cut-off was in accordance with the Australian Standard. He said it was irrelevant whether the applicant failed the test deliberately. Mr Linde denied saying he did not care about the applicant’s family or personal life. Rather, he said that his family situation was not the issue. There was no discussion about the applicant using marijuana for pain management, related to a post work-related injury.

[49] In cross-examination, Mr Linde said the Company Standard applied as a corporate policy across the Whitehaven Group. He said that the policy has different types of testing according to the steps in the process.

[50] Mr Linde was unaware of, and not involved in the process for selecting employees to be randomly tested. (He had been tested many times.) Mr Linde said the screening cup test is used randomly or where a supervisor, or another employee, suspects an employee may be under the influence of drugs or alcohol. Mr Linde further explained that an employee can also self-test and then not present for work; but once an employee logs on for work, they can be subject to a random test.

[51] Mr Linde accepted that the respondent does not have a zero tolerance policy (notwithstanding paragraph 14 of his first statement). He explained that that if an employee returns a first non-negative result, the disciplinary process is initiated. The employee is stood down, is given a warning and has three weeks to return a clear result. If there is a second positive result, termination of employment is an option. At all times, the matter is considered a serious breach of policy.

[52] Mr Linde understood the applicant had been taking steps to clear his system, and had bought, and been given test cups to self-test. However, despite this, he failed the second result after three weeks, after retaining significant levels of cannabis in his system. He was dismissed for a fundamental safety breach at the mine. Mr Linde believed that in the last few years, no other employee had returned a positive result after three weeks. Mr Linde was referred to relevant sections of the policy, which he considered to be part of a disciplinary process.

[53] Mr Linde agreed the applicant was given the warning letter on 6 April 2017, despite it being related to the first test on 15 March 2017. This was because the applicant was not at work and if discipline is involved, it is dealt with face-to-face and with a support person. Mr Linde was unaware the applicant attended the mine on 28 March 2017. He agreed the level of 15 g/L is not mentioned in the Company Standard, but it refers to the laboratory testing being in accordance with the Australian Standard. Mr Linde knew the applicant was self-testing and returning negative results, but the Company Standard requires Lab testing in the applicant’s circumstances.

Mr Jarrod Eather

[54] After setting out his personal, family and work background, the applicant said he had never received a formal warning during his employment at the mine, since October 2011.

[55] The applicant did not dispute the circumstances surrounding the screening cup test he undertook on 15 March 2017 at the commencement of afternoon shift. He had received a non-negative result for this sample. When he was driven home by Mr Hall, he asked what was to happen next. Mr Hall was not sure, but there was a policy dealing with the matter. A few days later, he received a copy of the Company Standard. About a week later, Mr Hall phoned him to advise he had a ‘fail’ confirmation. However, he was neither told the exact level, nor given a copy of the Lab results. When Mr Hall told him he had three weeks to pass the test, the applicant told him he had been self-testing and had failed. He told Mr Hall he ‘would do whatever you want me to do’. Mr Hall arranged for him to do a test on 28 March 2017. He undertook the test that day and it returned a non-negative result. He went to inform Mr Hall in his office. Mr Hall offered him three test cups and said:

‘[H]ere are some testing cups, just take them test yourself when you pass, you are fine to come back and commence work underground as normal.’

[56] The applicant claimed that, at no time on 28 March 2017, was any reference made to the difference between 50 g/L and 15 g/L. He believed that once he passed the screening cup test, he would be fine to return to work. He self-tested every day, or second day, and was clear on the third test on 1 April 2017. He said he had been running and training in an attempt to sweat out any residual THC.

[57] The applicant referred to a call from Mr Taylor (see Mr Taylor’s version outlined at paragraph [29] above). Mr Taylor told him his results were high and he had three weeks to attend the site and pass a second test. While not told his actual result, the applicant told Mr Taylor that he ‘did not think it was a high result, if it was, it would take months for it to get out of my system not a couple of weeks’. Mr Taylor told him his breach was a serious matter and if he did not pass, he could lose his job. Mr Taylor did not explain that there was another form of testing to the screening cup test, or that there was a different cut-off for screening cup tests to any other test. He simply said he needed to pass when he attended the site.

[58] The applicant claimed that when Mr Hall rang him to direct him to attend the site on 6 April 2017, he had added ‘be prepared to work your night shift if you pass the test’. When he undertook the test, the tester told him he had passed. Mr Hall had told her to send the sample off for further testing. The applicant claimed this was the first time he had heard of the results having to be sent off for further testing. He asked the tester what this meant. She had said she was surprised when Mr Hall told her the results must come back less than 15 g/L, even after passing the site cup screening test. The applicant then went to look for Mr Hall, but could not find him.

[59] In respect to the 6 April 2017 disciplinary meeting, it was the applicant’s evidence that this was the first time he had been informed of the 65 g/L level for the 15 March 2017 test, and that the subsequent test sample would be referred to the Lab. Up to this point, he had believed and acted on the basis that he could return to work if he passed the 50 g/L screening cup test. He then left the meeting. He later received a call from Mr Hall to require him to attend a meeting on 12 April 2017. When he asked for his results, Mr Hall declined to provide them.

[60] The applicant’s version of events at the 12 April 2017 meeting differed from Mr Linde’s and Mr Taylor’s evidence in the following respects:

[61] The applicant said he received an average wage of around $3,365.41 per week when employed by Whitehaven and, while he was looking for alternative employment, there were no other underground coal mines in the local area. He hoped for a casual job in the western coal fields, near Mudgee. He may have to leave his family and work away from home, or relocate his family away from friends and relatives. The applicant has received no income since his dismissal. At the time of making his statement, he had been out of work for 16 weeks and had lost $53,846 in income.

[62] In response to Mr Hall’s inclusion of his medical history, disclosing he was a ‘regular marijuana user’, the applicant said this was inappropriate because the respondent had no right to access his medical records. In any event, the reference to ‘regular marijuana user’ was an historic reference from 20 years ago, which had remained on his medical file ever since. It did not relate to his current medical status. The applicant claimed that in 2014, he had mentioned to Mr Hall that he had used marijuana, 10 years earlier.

[63] The applicant denied he received the Lab result for his 65 g/L sample. Mr Hall had never mentioned a cut-off of 15 g/L, and he was not aware of this until 6 April 2017. He denied Mr Hall had told him his 15 March 2017 sample would be sent to the Lab, which would require a result under 15 g/L to pass. The applicant denied telling Mr Hall he was using test kits. He had only undergone a single test. He was not informed of a different test, and would not have relied on the screening cups, if they had no application. The applicant claimed he had not taken any drugs since the weekend of 11 and 12 March 2017.

[64] The applicant said there was only one adjournment in the 12 April 2017 meeting (not withstanding he acknowledged two breaks earlier in his statement). The applicant reaffirmed his version of the conversation with Mr Taylor on 3 April 2017. He denied saying that ‘it was Matt’s fault’. Rather, he was led to believe that if he passed the screening cup test, he could return to work that night.

[65] Exhibit C, tendered on the second day of hearing, revised the applicant’s average income to $2,794.73 per week, plus $243.02 in superannuation, resulting in a loss since dismissal of $68,275.26, plus $5,937.03 in superannuation. However, as the applicant’s income exceeded the high income threshold, he was seeking $71,000 in compensation. It was noted that had the applicant been dismissed with notice, he would have received three weeks’ pay, plus superannuation.

[66] In oral evidence, the applicant said that he had applied for a mining job with Coalroc, and given his neck injury, he had been reviewed by a doctor. He did not get the job. The applicant claimed he had applied for a number of jobs shortly after his dismissal, but had only three interviews.

[67] As to his previous warnings, the applicant understood that as they were verbal warnings, they were not formal written warnings. Nevertheless, he remembered them, and agreed he had seen the warning letters. However, he had not been given a copy of one of them. In oral evidence, the applicant agreed that as the first warning was headed ‘Formal Warning’, this was inconsistent with what he claimed in his statement. He claimed the second formal warning was not a warning, because he did not sign it. He accepted his statement in this respect was incorrect.

[68] In cross examination, the applicant acknowledged that he was aware of, and understood the Company Standard in respect to the use of drugs and alcohol, although he had just ‘flicked through it’ at the time. In particular, he was aware the respondent offered support programs. However, he had not sought assistance in respect to his drug use. This was because he was not a ‘full-time drug user’ and only used marijuana as a desperate alternative to the pain from his injury and the side effects of other medication. He believed if he were a daily user, the THC would remain in his system for up to three months.

[69] It was the applicant’s evidence that prior to the first test (15 March 2017), he had used marijuana on the weekend before. As 15 March was a Wednesday, he agreed he did not self-test when he attended for work on either the Monday, Tuesday or the Wednesday, knowing he had used marijuana on the weekend. However, he said he had only had two joints on the Friday before the weekend, after work. Prior to this, the last time he had used marijuana was ‘over 10 years ago’. On this evidence, it meant that smoking only two joints registered 65 g/L, five days later, and continued to register above the Australian Standard, three and a half weeks later. It was put to the applicant that for an average person, in order for marijuana to be detected in your system more than 14 days after use, one has to be a chronic user. The applicant answered by saying ‘everyone is different. I’ve read all about it.’ It was put again that if he had only had two joints, it would not be detected after two or three days. The applicant said he did not know about that.

[70] As to his use of marijuana for medical purposes, the applicant conceded he did not ask his treating doctor whether it was appropriate to mix cannabis with prescribed painkillers. He did not raise it at all with the doctor. He said he still takes painkillers when the pain gets bad, but added ‘not very regularly’.

[71] As to the conflicting evidence that he had never raised the issue of his drug use for medical purposes, the applicant disagreed and said that he had. He was asked why it was not mentioned in his unfair dismissal application. He claimed that Mr Hall, Mr Linde and Mr Taylor all knew about it. He had told Mr Hall on the drive home on 15 March 2017. However, this is not mentioned in his statement. Nor was it put to Mr Hall in cross-examination. He could not explain any of these omissions. Nor did he mention it in his statement when responding to Mr Taylor’s evidence. The applicant denied making up his evidence. He now said he also mentioned it in the 6 April 2017 meeting; but again, this was not referred to in his statement.

[72] The applicant could not explain why he did not tell anyone in Management that he had only smoked two joints. He reiterated his evidence concerning the 2014 medical report’s reference to him being a ‘regular marijuana user’ that it had remained on his file from over 20 years ago. He claimed he could prove this, but the medical centre had closed down. He claimed this medical history passed through three medical centres, without alteration.

[73] The applicant confirmed the majority of Mr Hall’s version of their phone conversation on 20 March 2017, except he denied Mr Hall ever mentioned a 15 g/L cut-off in this conversation, or in other subsequent conversations on 27 and 28 March 2017, when he came in for a self-test. The applicant insisted that all Mr Hall ever said was that if he provided a negative screening cup test sample, he could go back to work. He had provided him with the cups to do so.

[74] The applicant further confirmed the majority of Mr Taylor’s version of their conversation on 3 April 2017, except that he denied he told him he thought his reading was low and he would be all right. He denied Mr Taylor told him his next screening cup test sample would be sent to the Lab. He just said he had to pass another test.

[75] The applicant agreed with the substance of the conversation during the 12 April 2017 disciplinary meeting. However, Mr Linde had said he did not care about his personal life or family. He insisted there was only one break in the meeting.

[76] Mr Britt put to the applicant that he did not think of his family when he went to work on Monday 13, Tuesday 14 and Wednesday 15 March 2017 ‘under the influence of marijuana’. His answer was he was not under the influence, it was just in his system, as it could have been in half of the crew if they had been cup tested. He was then asked if he thought about his crew when he came to work for three days with marijuana in his system. His answer was he did not know he would go over 50 g/L and believed he would pass the screening cup test.

[77] In re-examination, the applicant said he last told his medical practitioner he was a ‘regular marijuana user’ when he was about 21 years old – over 20 years ago. The applicant believed that the effects of marijuana last for four to five hours.

SUBMISSIONS

For the respondent

[78] Mr Britt submitted that this case largely turns on the credit of the applicant’s evidence. This is so for three reasons. Firstly, there is a stark contrast between the applicant’s and the employer’s account of the various discussions they had from the date of the first testing (15 March 2017) to the date of termination (12 April 2017). While there are some common features between their evidence, (particularly after the applicant’s cross examination), there are still key differences in respect to what actually occurred on the date of termination; whether the respondent had a pre-prepared termination letter; whether the applicant had explained in the final meeting that he used marijuana for pain relief; and what the applicant had to do in order to pass the last drug test and return to work. An assessment of witness credit is important in respect to these matters.

[79] Secondly, determining witness credit is significant in respect to the actual testing results dealing with the presence of THC in the applicant’s system. Mr Britt pointed out that initially, the applicant’s evidence was that he smoked one or two, and then two joints on the weekend of 11 to 12 March 2017. The applicant’s later evidence was that the last time he used marijuana had been in excess of some 10 years earlier. Mr Britt submitted that the applicant’s version of events is inconsistent with the actual levels of THC in his system, both in the first test, the second test, and the last test, some three and a half weeks later. His evidence was also inconsistent with his referral letter from his GP, dated 17 April 2014.

[80] Thirdly, Mr Britt submitted that questions of credit are relevant in determining whether the decision of the respondent was ‘harsh’. In essence, the position of the respondent is that the applicant had not been frank with the Commission in respect to the extent of his marijuana use.

[81] Mr Britt contrasted this type of case with those cases where employees concede they have a problem, show remorse and admit they need help. In this case, the applicant denies any drug problem, any dependency and made no requests for help. He maintains that on Friday, 10 March 2017, he had two joints after work. On the following Wednesday, he had been randomly tested for illicit substances and found to have a THC level of 65 g/L in his system. Mr Britt said that the applicant’s version of events is also inconsistent with the medical evidence and the scientific literature dealing with drug use and retention levels.

[82] Mr Britt submitted that reinstatement is not practicable given:

(a) the severity of the applicant’s failure to meet the respondent’s policies and expected standards;

(b) the applicant does not appreciate the gravity of his conduct;

(c) the impact on the respondent in respect to non-compliance with its policies; and

(d) the lack of trust in the applicant, given his drug taking conduct and lack of credibility.

[83] Mr Britt submitted that there was clearly a valid reason for the applicant’s dismissal. The applicant attended for work, was randomly tested, and tested positive for illicit substances. Some days later, the applicant attended work again, for the purpose of testing, and failed that test as well. He had three weeks to provide a negative result. While the applicant seems to have interpreted a negative result to be less than 50 g/L, the respondent submits that a negative result, under the Company Standard is below the Australian Standard of 15 g/L. Mr Britt said that the respondent had reasonable policies in place, which are appropriate given issues of occupational health and safety and the fact the applicant is employed as a miner in an underground mining environment. The applicant was aware he could not attend for work when he was adversely affected by drugs or alcohol, and that doing so may impact on his own health and safety at work. Despite this, the applicant’s concern was not whether he had marijuana in his system, but whether he would pass the drug test. He clearly has a long term problem with the use of marijuana and was prepared to attend for work with marijuana in his system.

[84] In respect to the other considerations under s 387 of the Act, the applicant was provided an opportunity to respond to the allegation. He availed himself of that opportunity and had a support person in meetings with the respondent on 6 and 12 April 2017. This case concerns the applicant’s conduct and not his performance, so questions of warnings are not paramount. Notwithstanding this, the respondent’s policy clearly sets out the impact of non-compliance. Considering these factors, the dismissal was not ‘harsh’.

[85] Turning to particular aspects of the applicant’s evidence, Mr Britt said that the applicant’s explanation of the Doctor’s 2014 referral is simply not believable and quite problematic. He questioned the applicant’s evidence that the Doctor was referring to matters twenty years earlier (when that Doctor was not even his treating Doctor), based upon a hope that it was found in some previous medical record at a previous medical centre. It was difficult to imagine that after the applicant discovered that the Doctor’s letter referred to him as a ‘regular marijuana user’, rather than address it, the applicant chose to do nothing about it.

[86] Mr Britt referred to the Douglass Manly Moir Pathology Toxicology Report available on its website. The report outlines the average drug detection times in urine samples for various illicit substances, including cannabis. Mr Britt recognised there is a proviso in the report that individual variation can significantly influence the detection time of pharmalogical agents in urine specimens. However, according to the scale, if a non-user of marijuana smokes one to two joints, the detection time is no more than two to three days. On the applicant’s version of events, it must mean he would not have failed the test the following Wednesday. Remarkably, the applicant recorded a positive result three and a half weeks later, which puts him above and beyond the ‘regular user’ category. This result is obviously inconsistent with the applicant’s version of events in respect to smoking two joints on 10 March 2017, for the first time in ten years.

[87] Further developing this point, Mr Britt referred to the National Highway Traffic Safety Administration’s (a United States Government Agency) Drug and Human Performance Fact Sheet on THC (available on their website). The Fact Sheet states that ‘Positive test results generally indicate use within 1-3 days; however, the detection window could be significantly longer following heavy, chronic use’. Mr Britt also relied on the Fact Sheet where it states that chronic or heavy marijuana use results in ongoing risks to driving.

For the applicant

[88] In accepting the applicant had failed the first test on 15 March 2017 where he had been randomly chosen and had tested 65 g/L, Mr Endacott put that the applicant was not dismissed for that reason; rather, he was dismissed for attending work on 6 April 2017 and failing a laboratory test after passing a screening cup test. In those circumstances, there was no valid reason for the dismissal, and his dismissal was ‘harsh’. Mr Endacott elaborated how on 6 April 2017, the applicant attended work and passed the initial screening cup test. At that point, he was given a warning for the test failure on 15 March 2017. That cup test was then sent for confirmatory testing and because a different standard was used, he received a positive result. He was dismissed on 12 April 2017 for this reason. The applicant had not taken any drugs since 10 March 2017. The testing on 6 April 2016, which produced a negative result based upon the screening test, was testing residual THC in his system related to the first fail.

[89] Mr Endacott set out the sequence of events prior to the applicant’s dismissal. He attended for work on 28 March 2017 and undertook a second cup test which recorded 48 g/L. He then self-tested at home with a testing kit he bought. Based on that test, he believed he was going to fail. The Company then gave the applicant three cups to self-test at home. He was informed that should he pass the cup tests, he would be allowed to return to work (although Mr Endacott conceded that this point is contested). In this respect, Mr Endacott submitted that the applicant had been misled by the respondent. He was under the impression that if he passed the screening cup test (which could only identify a positive result if there was at least 50 g/L), he would be allowed to return to work. He was dismissed when the Lab test result was below 50 g/L. If any other employee had a level less than 50 g/L, then the screening cup test would show a negative result. Accordingly, they would not be in breach of the Company Standard or their contract of employment.

[90] Mr Endacott referred to the evidence of Mr Hall. Under cross examination, Mr Hall explained why he provided the three self-test cups to the applicant:

‘I provided him with the cups because, at that time, he was still testing above the screening limit. It was – I’ve never provided the cups on the premise that I believed that if he passed the cups that was his fitness for work test and that was available.’

Mr Endacott submitted that when Mr Hall used the words ‘I provided him with the cups because, at that time, he was still testing above the screening limit’ it reasonably left the applicant with the impression that as long as he passed those tests, he would be permitted to return to work.

[91] Mr Endacott did not dispute that the applicant’s conduct on 15 March 2017 was misconduct. In that respect, the Company gave him a formal warning (albeit on 6 April and after he had given a sample for the final test).

[92] Mr Endacott said that had the Company not provided the applicant with the self-test kits, he still ought not to have been dismissed. Under the Company’s self testing regime, if an employee attends for work, and is concerned they may be under the influence of drugs or alcohol, they can test themselves prior to commencing work. It can be inferred from that policy that if they pass the self test, they are justified in believing they are fit for work. This is the same self testing kits which Mr Hall provided to the applicant. The applicant’s evidence was that he had not smoked any marijuana since the two joints he had smoked on the Friday prior to 15 March 2017. He had received a warning for being under the influence as a result. It is unfair in these circumstances to dismiss him for being under the influence of drugs, when he had already received a warning for that misconduct.

[93] In respect to the Douglass Hanly Moir Pathology Toxicology Report, Mr Endacott submitted that the proviso ‘Individual variations can significantly influence detection times’ was the kind of cautionary note which means it should not be relied upon in any material way. Mr Endacott also rejected Mr Britt’s submission regarding the detection times in this report. Mr Endacott understood the detection windows to be based on the 50g/L result, not 15g/L. The only time the applicant was tested above 50g/L was on 15 March 2017. He received a warning for this incident.

[94] Mr Endacott submitted that the applicant was not given a sufficient opportunity to respond. He had been dismissed at the start of the meeting on 12 April 2017, in circumstances where he was told the purpose of the meeting was to show cause why he should not be dismissed. The opportunity to respond was provided to him after the decision to terminate his employment had been made and a termination letter had been prepared.

[95] Mr Endacott further submitted that the Commission should take into account the applicant’s personal circumstances, including his large family and the financial hardship he has suffered as a result of his dismissal as an underground miner. In order for him to continue his work as an underground miner, he will need to leave the region and work in a remote location or uproot his family.

[96] In reply, Mr Britt reiterated that the detection windows are based on 15g/L. In respect to the self-testing regime, Mr Britt said that the applicant’s submissions would perhaps carry more weight if he had relied on that policy. His evidence was that he was not aware he could self-test. More importantly though, he did not self-test prior to commencing work. In fact, the random test was on Wednesday 15 March 2017. The applicant had attended work two days earlier (when it could be assumed the THC level would have been at least 65 g/L or higher). The applicant had three weeks to attend work and provide a sample. He failed to so. Under the Company Standard this could result in his summary dismissal.

[97] Mr Britt submitted that there is no evidence that the applicant was an exemplary employee or that there were any special circumstances warranting mitigation of the penalty of dismissal. The fact that he has children cannot be determinative of whether a dismissal is ‘harsh’ since that would mean all dismissals would be ‘harsh’ if an employee had dependants and became unemployed.

CONSIDERATION

Relevant authorities

[98] There have been a small number of single member and Full Bench unfair dismissal decisions of the Commission where employees have been dismissed for breaches of the employer’s alcohol and drug policy, specifically in respect to drug use. There have been two notable Full Bench decisions. I refer first to Pitts v AGC Industries Pty Ltd t/a AGC [2013] FWCFB 9196 (‘Pitts’). Although I will not yield to the temptation of drawing conclusions based entirely on that case, given that each case must be determined on its own particular facts and circumstances, there are some remarkable factual similarities evident in both cases. In Pitts for example, like here:

  The Company did not have a zero tolerance policy where the presence of drugs is detected in a random urine sample. It was a two stage process. The site screening test if positive, requires a second confirmatory laboratory analysis to be undertaken shortly thereafter.

  The site test ‘cut off’ level was 50 g/L and the Laboratory ‘cut off’ was 15 g/L.

  The same Laboratory was used – Safe Work Laboratories.

  A failure to submit to a test to establish a clear result would have disciplinary consequences.

  All seven employees in Pitts who tested positive to the presence of at least one drug on 29 January 2013 were stood down until the Lab confirmatory testing.

  Of the seven employees subject to confirmatory testing:

  One was dismissed due to an earlier final written warning;

  Two returned to work, with no further action;

  One was issued with a written warning on returning to work;

  Two were returned to work with a first and final written warning after providing a clear sample after eight and nine days respectively; and

  The seventh employee, Mr Pitts, was dismissed when a confirmatory test on 7 February 2017 was so diluted it was inconclusive.

After his dismissal on 11 February 2014, Mr Pitts undertook a drug test on 14 March 2013 (over a month later), which returned no presence of illicit substances in his body.

[99] It is notable that in Pitts the employer gave the effected employees only two days to provide a clear drug test result after the first onsite test. As a result of representations from the Union, this was extended by a further eight days. Of more particular interest vis a vis this case, were the g/L readings of the two employees when first tested, to when they tested all clear on 8 February 2013, just 10 days later. Employee (3) had an initial reading of 222 g/L and Employee (5)’s reading was 201 g/L. In other words, they had more than three times the reading of Mr Eather when he first tested at 65 g/L; yet they were both clear after ten days. Mr Eather was not clear (although close to the cut off at 18 g/L), 22 days later. From my understanding of the scientific literature, the comparatively rapid clearance from the system in the case of Employees 3 and 5 may well be attributed to irregular or occasional drug use, and not habitual or chronic use. I hasten to add that I am not drawing any specific conclusions in respect to Mr Eather’s drug use, nor am I required to determine the extent of his drug use. There may be a range of factors, although not readily apparent to me, explaining the dichotomy of outcomes between the two sets of circumstances I have just described.

[100] In an appeal from a decision of Lawrence DP, the Full Bench of the Commission in Harbour City Ferries v Toms [2014] FWCFB 6249 granted permission to appeal and allowed the appeal, quashing the Deputy President’s decision to reinstate Mr Toms after he had been dismissed for testing positive to marijuana use. (A further Federal Court appeal did not disturb the Full Bench’s decision; Toms v Harbour City Ferries Pty Limited [2015] FCAFC 35). At paras [25] to [28] the Commission’s Full Bench said:

‘[25] We consider that Mr Toms’ seniority and his very high level of responsibility are factors which attract sympathy when considering outcome, but equally those factors demand a high level of compliance with policy.

[26] In addition, Mr Toms failed to immediately inform Harbour City of the potential for a positive finding. He put off the moment of confession as long as he could. This was not taken into account by the Deputy President.

[27] The lack of any impairment arising from drug use, the absence of a link between drug use and the accident and the absence of substantial damage to the Marjorie Jackson are not factors relevant to the ground of misconduct identified as non-compliance with the Policy. The fact is that Harbour City required its policy complied with without discussion or variation. As an employer charged with public safety it does not want to have a discussion following an accident as to whether or not the level of drug use of one of its captains was a factor. It does not want to listen to the uninformed in the broadcasting or other communications industry talk about drug tests establishing impairment. It does not need to have a discussion with any relevant insurer, litigant or passenger’s legal representative about those issues. What it wants is obedience to the policy. Harbour City never wants to have to have the discussion.

[28] The mitigating factors referred to and relied on by Deputy President Lawrence are not mitigating factors that address the core issue, which was the serious misconduct which led to the dismissal of Mr Toms. The core issue, the valid reason for termination of Mr Tom’s employment was his deliberate disobedience, as a senior employee, of a significant policy. The Deputy President does not address Mr Tom’s failure to comply with the Policy. The only mitigating factor relevant to this issue was the use of marijuana as pain relief. Consequent upon that explanation is the decision to accept a shift while aware of the likelihood of being in breach of the Policy.’

(Emphasis in original.)

[101] The distinguishing facts in this case were that the employer had a zero tolerance policy for drugs and alcohol. Mr Toms belatedly acknowledged he had used marijuana the day before an accident he had while operating a passenger ferry, which resulted in an injury to a passenger. While summarily dismissed, Mr Toms received five weeks pay in lieu of notice. On the other hand, the similarities to this case include:

  From the outset, Mr Toms claimed he was using marijuana for pain relief for his shoulder.

  Notwithstanding Mr Toms attended work to replace another employee on sick leave, Mr Toms knew he had smoked marijuana the day before, but took a risk he would not be randomly tested.

  Mr Toms did not believe he was impaired.

  Harbour City Ferries’ policy does not set out cut off levels, but refers to the Australian Standard.

  Mr Toms was aware of the Company policy and the possible consequences of any breach of policy.

I turn now to the present case.

Preliminary findings

[102] There are no jurisdictional objections to the applicant’s application being determined by the Commission. Specifically, I am satisfied that:

[103] Section 385 of the Act defines an unfair dismissal based on the four criteria there set out; each of which must be satisfied if the person seeking a remedy from unfair dismissal is to succeed. The section reads:

385 What is an unfair dismissal

A person has been unfairly dismissed if the FWC is satisfied that:

(a) the person has been dismissed; and

(b) the dismissal was harsh, unjust or unreasonable; and

(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and

(d) the dismissal was not a case of genuine redundancy.

Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.

[104] As I have just concluded that three of the above criteria have been satisfied ((a)(c) and (d)), this only leaves the question of whether Mr Eather’s dismissal was ‘harsh, unjust or unreasonable’ and therefore an unfair dismissal. To this end, one must direct attention to s 387 of the Act, which deals with the matters to be taken into account by the Commission in determining whether a dismissal was unfair. It is trite to observe that each of the matters must be considered and a finding made on each of them, including whether they are relevant or not; for example whether a person was (d) refused an opportunity to have a support person present may be irrelevant (neutral), if the request was not made, or the employee declined to take up the offer.

[105] The matters to be taken into account under s 387 of the Act are:

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

(b) whether the person was notified of that reason; and

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

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

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

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

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

(h) any other matters that the FWC considers relevant.

[106] All of the criteria in s 387 of the Act must be taken into account when the Commission considers whether a particular dismissal is unfair. Nevertheless, it must be steadily borne in mind that no one matter is to be attributed any greater weight than another. That this is so is obvious from the Explanatory Memorandum to the Fair Work Bill 2008 where at para 1541, it reads:

‘1541. FWA must consider all of the above factors in totality. It is intended that Fair Work Act 2009 will weigh up all the factors in coming to a decision about whether a dismissal was harsh, unjust or unreasonable and no factor alone will necessarily be determinative.’ (My emphasis)

Allegation of serious misconduct

[107] Mr Eather was summarily dismissed for serious misconduct; noting that the epithet ‘wilful’ was not used in the termination letter. ‘Serious misconduct’ is defined in the Act’s Regulations. Regulation 1.07 sets out the definition as follows:

1.07 Meaning of serious misconduct

(1) For the definition of serious misconduct in section 12 of the Act, serious misconduct has its ordinary meaning.

(2) For subregulation (1), conduct that is serious misconduct includes both of the following:

(a) wilful or deliberate behaviour by an employee that is inconsistent with the continuation of the contract of employment;

(b) conduct that causes serious and imminent risk to:

(i) the health or safety of a person; or

(ii) the reputation, viability or profitability of the employer’s business.

(a) the employee, in the course of the employee's employment, engaging in:

(i)  theft; or

(ii)  fraud; or

(iii)  assault;

(b) the employee being intoxicated at work;

(c) the employee refusing to carry out a lawful and reasonable instruction that is consistent with the employee's contract of employment [my emphasis].’

[108] It may be comfortably assumed that Whitehaven relies on ss (2)(b) of the Regulation. However, that in itself, is not necessarily determinative. In Sharp v BCS Infrastructure Support Pty Limited [2015] FWCFB 1033, the Full Bench of the Commission said at para [33]-[34]:

[33] The relevance of the definition of “serious misconduct” in reg.1.07 to the matter is also, with respect, obscure. Section 12 of the Act contains a definition of “serious misconduct” for the purposes of the Act which simply cross-refers to reg.1.07. Apart from s.12 itself, the expression “serious misconduct” is used in only three places in the Act. In s.123(1)(b), a dismissal for serious misconduct is a circumstance in which the notice and redundancy entitlement provisions of Pt 2-2 Div 11 are not applicable; in s.534(1)(b) a dismissal for serious misconduct is one to which the requirements for notification and consultation in Pt 3-6 Div 2 do not apply; and in s.789(1)(b) a dismissal for serious misconduct is one in relation to which the requirements established by Pt 6-4 Div 3 for notification and consultation do not apply. The expression “serious misconduct” is not used anywhere in Pt 3-2, Unfair Dismissal, of the Act. Section 392(3) requires the Commission, in relation to the award of compensation for an unfair dismissal, to reduce the amount that it would otherwise order by an appropriate amount where it is “satisfied that the misconduct of a person contributed to the employer’s decision to dismiss the person”. However, it is clear that conduct may constitute “misconduct” for the purpose of s.392(3) without necessarily being “serious misconduct”. The expression is used in the Small Business Fair Dismissal Code, but that had no application in this case (and it is at least highly doubtful in any event whether the reg.1.07 definition applies to the Small Business Fair Dismissal Code). Reg.1.07 therefore had no work to do in the application of the provisions of Pt 3-2 to the circumstances of this case.

[34] It may be accepted that an assessment of the degree of seriousness of misconduct which has been found to constitute a valid reason for dismissal for the purposes of s.387(a) is a relevant matter to be taken into account under s.387(h). In that context, a conclusion that the misconduct was of such a nature as to have justified summary dismissal may also be relevant. Even so, it is unclear that this requires a consideration of whether an employee’s conduct met a postulated standard of “serious misconduct”. In Rankin v Marine Power International Pty Ltd  Gillard J stated that “There is no rule of law that defines the degree of misconduct which would justify dismissal without notice” and identified the touchstone as being whether the conduct was of such a grave nature as to be repugnant to the employment relationship. “Serious misconduct” is sometimes used as a rubric for conduct of this nature, but to adopt it as a fixed standard for the consideration of misconduct for the purpose of s.387(h) may be confusing or misleading because the expression, and other expressions of a similar nature, have been considered and applied in a variety of contexts in ways which are influenced by those contexts. In McDonald v Parnell Laboratories (AustPty Ltd Buchanan J said:

“[48] The terms ‘misconduct’, ‘serious misconduct’ and ‘serious and wilful misconduct’ are often the subject of judicial and administrative attention as applied to the facts of particular cases but there is relatively little judicial discussion about their content and meaning. Naturally enough, when the term ‘serious misconduct’ is under consideration an evaluation of what conduct represents ‘serious’ misconduct is influenced by the (usually statutory) setting in which the phrase must be given meaning and applied. Frequently, for example, the question at issue is whether an employee is disentitled by reason of his or her conduct to a statutory entitlement (eg. in New South Wales, where Ms McDonald was employed, see Long Service Leave Act 1955 (NSW) s 4(2)(a)(iii); Workers Compensation Act 1987 (NSW) s 14(2).” (footnotes omitted)

[109] The notion of wilful or deliberate behaviour amounting to serious misconduct is conduct which strikes at the heart of the employment relationship. That concept has been considered in a number of well known authorities (although characterised in slightly different terms). In North v Television Corporation Ltd, (1976) 11 ALR 599 Franki J said at p 616:

‘It is clear that a single act of disobedience may be sufficient to justify dismissal on the ground of misconduct but it was held in Laws v London Chronicle (Indicator Newspapers) Ltd [1959] 2 All ER 285, that to justify summary dismissal a single act must be such as to show that the employee was repudiating the contract of service or one of its essential conditions.’

[110] Laws v London Chronicle (Indicator Newspapers) Ltd [1959] 2 All ER 285 (referred to in the quote above) makes it plain that an act of disobedience or misconduct (justifying dismissal) requires also that the disobedience must be ‘wilful’:

‘... I do, however, think (following the passages which I have already cited) that one act of disobedience or misconduct can justify dismissal only if it is of a nature which goes to show (in effect) that the servant is repudiating the contract, or one of its essential conditions; and for that reason, therefore, I think that one finds in the passages which I have read that the disobedience must at least have the quality that it is “wilful”: it does (in other words) connote a deliberate flouting of the essential contractual conditions (P288).’

[111] In Concut Pty Ltd v Worrell (2000) 103 IR 160, His Honour, Kirby J, dealt with the ordinary relationship of the employer and employee at common law and said at para [51]:

‘The ordinary relationship of employer and employee at common law is one importing implied duties of loyalty, honesty, confidentiality and mutual trust. At common law:

“conduct which in respect of important matters is incompatible with the fulfilment of an employee’s duty, or involves an opposition, or conflict between his interest and his duty to his employer, or impedes the faithful performance of his obligations, or is destructive of the necessary confidence between employer and employee, is a ground of dismissal. ...[T]he conduct of the employee must itself involve the incompatibility, conflict, or impediment, or be destructive of confidence. An actual repugnance between his acts and his relationship must be found. It is not enough that ground for uneasiness as to its future conduct arises.”

In the present case, the findings at trial went beyond mere uneasiness as to the future. They necessitated, or at least warranted, a conclusion that the “confidence” essential to the relationship of employer and employee had been destroyed. Instead of pursuing the interests of the company and its shareholders, the employee had pursued his own private interests. Not only was the employee in breach of his duty of fidelity and trust owed to the employer, he had remained in breach of that duty to the date of the trial. Until that time he had not accounted for the benefits wrongly appropriated by him. Indeed, he had denied any wrongful appropriation. The issue so tendered at the trial was determined against the employee. He was then subject to the employer’s counter-claim for an order to make a refund. Such order was duly made at trial. It was not contested on appeal. Given his senior status in the company’s service and the nature and extent of the misconduct disclosed in the evidence and accepted by the primary judge, it was open to him to find that the employee had undermined the confidence essential to the ongoing relationship of employment. Prima facie, this had afforded a legal justification for the employee’s summary dismissal.

It is, however, only the exceptional circumstances that an ordinary employer is entitled at common law to dismiss an employee summarily. Whatever the position may be in relation to ‘isolated’ acts of negligence, incompetence or unsuitability, it cannot be disputed (statute or express contractual provision aside) that acts of dishonesty or similar conduct destructive of the mutual trust between the employer and employee, once discovered, ordinarily fall within the class of conduct which, without more, authorises summary dismissal. Exceptions to this general position may exist for trivial breaches of the express or implied terms of the contract of employment. Other exceptions may arise where the breaches are ancient in time and where they may have been waived in the past, although known to the employer. Some breaches may be judged irrelevant to the duties of the particular employee and an ongoing relationship with the employer. But these exceptional cases apart, the establishment of important, relevant instances of misconduct, such as dishonesty on the part of an employee like Mr Wells, will normally afford legal justification for summary dismissal. Such a case will be classified as amounting to a relevant repudiation or renunciation by the employee of the employment contract, thus warranting summary dismissal.’

[112] In cases of summary dismissal, the onus rests on the respondent to prove, to the Commission’s satisfaction, that the misconduct, has in fact, occurred. While this evidentiary onus must be discharged on the civil onus of proof (on the balance of probabilities); Briginshaw v Briginshaw [1938] HCA 34; (1938) 60 CLR 336 (‘Briginshaw’), the more serious the allegation, the higher the burden on the employer to prove the allegation. In Neat Holdings Pty Ltd v Karajan Holdings Pty Ltd (1992) 110 ALR 449, the High Court said:

‘The ordinary standard of proof required of a party who bears the onus in civil litigation in this country is proof on the balance of probabilities. That remains so even where the matter to be proved involves criminal conduct or fraud. On the other hand, the strength of the evidence necessary to establish a fact or facts on the balance of probabilities may vary according to the nature of what it is sought to prove. Thus, authoritative statements have often been made to the effect that clear proof is necessary "where so serious a matter as fraud is to be found". Statements to that effect should not, however, be understood as directed to the standard of proof. Rather, they should be understood as merely reflecting a conventional perception that members of our society do not ordinarily engage in fraudulent or criminal conduct and a judicial approach that a court should not lightly make a finding that, on the balance of probabilities, a party to civil litigation has been guilty of such conduct.’ (footnotes omitted)

[113] That the Commission, for itself, must be satisfied that the misconduct occurred, is well established by the authorities of the Commission and its predecessors. In King v Freshmore (Vic) Pty Ltd [2000] AIRC 1019, a Full Bench of the AIRC said at paras [24], [26], [28] and [29]:

[24] The question of whether the alleged conduct took place and what it involved is to be determined by the Commission on the basis of the evidence in the proceedings before it. The test is not whether the employer believed, on reasonable grounds after sufficient enquiry, that the employee was guilty of the conduct which resulted in termination.

...

[26] As we have noted above, s.170CG(3)(a) obliges the Commission to make a finding as to whether there was a valid reason for the termination of employment. In circumstances where a reason for termination is based on the conduct of the employee the Commission must also determine whether the alleged conduct took place and what it involved.

...

[28] It is apparent from the above extract that his Honour answered the question of whether the alleged misconduct took place on the basis of whether it was reasonably open to the employer to conclude that the employee was guilty of the misconduct which resulted in termination. This is not the correct approach. The Commission's obligation is to determine, for itself and on the basis of the evidence in the proceedings before it, whether the alleged misconduct took place and what it involved.

[29] In our view the Senior Deputy President failed to determine for himself whether Mr King was guilty of misconduct in the way alleged by Freshmore and he should have done so as part of determining whether the termination had been harsh, unjust or unreasonable. When the reason for a termination is based on the misconduct of the employee the Commission must, if it is an issue in the proceedings challenging the termination, determine whether the conduct occurred. The absence of such a finding leads us to conclude that the member below failed to properly determine whether there was a valid reason for the termination of Mr King's employment.’ (my emphasis)

[114] Even accepting that a finding of serious misconduct was open to Whitehaven, it must not be confused with the statutory language. The statute still requires the Commission to find that there was, or was not, a valid reason for dismissal (s 387(a)). In Royal Melbourne Institute of Technology v Asher [2010] FWAFB 1200, a Full Bench of Fair Work Australia (FWA, as the Commission then was) held at para [16]:

[16] In the circumstances of this matter the University purported to terminate Dr Asher’s employment for serious misconduct within the meaning of that term in the University’s enterprise agreement. If it successfully established that Dr Asher had engaged in serious misconduct it would necessarily follow that there was a valid reason for the dismissal. However, the converse is not true. As established by Annetta, the question that needed to be considered was whether there was a “valid reason” in the Selvachandran sense – whether the reason was sound, defensible or well founded. Whether it also amounted to serious misconduct may well be a factor relating to the overall characterisation of the termination but it was not an essential requirement in the determination of whether a valid reason exists.’

Meaning of ‘harsh, unjust or unreasonable’?

[115] I earlier set out at para [105] the matters the Commission is required to take into account under s 387 of the Act when determining this question. I commence with ‘valid’ reason.

[116] The meaning of valid reason in s 387(a) is drawn from the judgement of North J in Selvachandran v Peterson Plastics Pty Ltd (1995) 62 IR 371 (‘Selvachandran’). This meaning has been considered and applied by members of the Commission and its predecessors for many years. For example, in Rode v Burwood Mitsubishi Print R4471, a Full Bench of the then Australian Industrial Relations Commission (AIRC) discussed the meaning of valid reason in the context of the relevant provisions of the Workplace Relations Act 1996, and by citing Selvachandran . The following is an extract from the Full Bench’s decision at para [17]-[19]:

[17] In relation to the meaning of “valid reason” the following remarks of Northrop J in Selvachandran v Peteron Plastics Pty Ltd are relevant:

“Section 170DE(1) refers to a ‘valid reason, or valid reasons’, but the Act does not give a meaning to those phrases or the adjective ‘valid’. A reference to dictionaries shows that the word ‘valid’ has a number of different meanings depending on the context in which it is used. In The Shorter Oxford Dictionary, the relevant meaning given is: ‘2. Of an argument, assertion, objection, etc; well founded and applicable, sound, defensible: Effective, having some force, pertinency, or value.’ In The Macquarie Dictionary the relevant meaning is ‘sound, just or wellfounded; a valid reason’.

In its context in s 170DE(1), the adjective ‘valid’ should be given the meaning of sound, defensible or wellfounded. A reason which is capricious, fanciful, spiteful or prejudiced could never be a valid reason for the purposes of s 170DE(1). At the same time the reason must be valid in the context of the employee’s capacity or conduct or based upon the operational requirements of the employer’s business. Further, in considering whether a reason is valid, it must be remembered that the requirement applies in the practical sphere of the relationship between an employer and an employee where each has rights and privileges and duties and obligations conferred and imposed on them. The provisions must `be applied in a practical, commonsense way to ensure that’ the employer and employee are each treated fairly, see what was said by Wilcox CJ in Gibson v Bosmac Pty Ltd, when considering the construction and application of a s 170DC.”

[18] While Selvachandran was decided under the former statutory scheme the above observations remain relevant in the context of s.170CG(3)(a). A valid reason is one which is sound, defensible or well founded. A reason for termination which is capricious, fanciful, spiteful or prejudiced is not a valid reason for the purpose of s.170CG(3)(a).

[19] We agree with the appellant’s submission that in order to constitute a valid reason within the meaning of s.170CG(3)(a) the reason for termination must be defensible or justifiable on an objective analysis of the relevant facts. It is not sufficient for an employer to simply show that he or she acted in the belief that the termination was for a valid reason.

See also: Nettleford v Kym Smoker Pty Ltd (1996) 69 IR 370.

[117] In Browne v Coles [2014] FWC 3670, Hatcher VP adopted the ratio of the majority of the Full Bench in B, C and D v Australian Postal Corporation T/A Australia Post in respect to breaches of the employer’s policies in the context of s 387(a) considerations. His Honour said at para [62]-[63]

‘[62] The Full Bench majority (Lawler VP and Cribb C) in B, C and D v Australian Postal Corporation T/A Australia Post discussed the significance of breaches of employer policies in the context of a consideration of whether there was a valid reason for dismissal in the following way:

“[35] ... as indicated by Northrop J in Selvachandran, “valid reason” is assessed from the perspective of the employer and by reference to the acts or omissions that constitute the alleged misconduct, on which the employer relied, considered in isolation from the broader context in which they occurred. It is the reason of the employer, assessed from the perspective of the employer that must be a “valid reason” where “valid” has its ordinary meaning of “sound, defensible or well founded”. As Northrop J noted, the requirement for a “valid reason” should not impose a severe barrier to the right of an employer to dismiss an employee”.

[36] A failure to comply with a lawful and reasonable policy is a breach of the fundamental term of the contract of employment that obliges employees to comply with the lawful and reasonable directions of the employer. In this way, a substantial and wilful breach of a policy will often, if not usually, constitute a “valid reason” for dismissal.”

[63] I respectfully adopt the above reasoning. There could be no doubt that any act of physical violence (which would include pushing someone) would be a substantial breach of the Code. Mr Browne’s conduct was “wilful” in the sense of being intentional. As I have found, his sense of judgment would have been affected by Mr Hearne’s earlier harassing behaviour and his apprehension that Mr Hearne might strike him. However, that is a matter which I consider (consistent with the reasoning in B, C and D) should be considered in the context of s.387(h) as a relevant matter going to whether the dismissal was harsh, unjust or unreasonable rather than under s.387(a). I therefore find that there was a valid reason for Mr Browne’s dismissal.’

[118] In B, C and D v Australian Postal Corporation, a majority of the Full Bench (Lawler VP and Cribb C) dealt with breaches, by a number of employees of Australia Post’s IT policies in respect to the sending, receiving and sharing of pornographic material. In discussing the significance of an employee’s compliance with an employer’s policies and procedures, the Full Bench said at para [61] – [67]:

‘[61] The formulation, implementation, dissemination and enforcement of polices are a matter within the prerogative of management. The almost infinite variety of businesses and their circumstances necessarily leads to great variability in employer approaches to those matters. In particular, there is great variability in the approach of employers to:

  The form and content of policies. (Employer policies come in all shapes and sizes. Some employers have voluminous policies filled with detailed prescription. Others have polices expressed in broad terms.)

  They way in which employees are educated as to the content of polices.

  The way in which polices are enforced (some employers enforce their policies rigorously, other employers allow a situation to develop where particular breaches of policy go unanswered) and in disciplinary procedures and the approach to disciplinary decision making.

[62] Breaches of policy can often cover a spectrum from the trivial, minor or technical to the very serious.

[63] All or virtually all medium to large employers have a range of policies that employees are required to observe, including a policy against the accessing, transmission or storage of pornography and other unacceptable or inappropriate material and a policy against harassment and victimisation. Most employers train employees in the employer’s policies. Many if not most employers require employees to familiarise themselves with the employer’s policies. Many if not most employers have logon notices reminding employees using the employer’s IT system that they are bound by the employer’s policies. Common experience dictates that such policy training often does not result in enduring employee familiarity with the policies and that logon reminders become, as it were, part of the wallpaper.

[64] The nature of material that will come within descriptors such as “inappropriate”, “unacceptable” or “pornographic” and the like will present as a spectrum. The lines of delineation between appropriate and inappropriate or acceptable and unacceptable are not sharp because they are broad, even amorphous, terms in respect of which reasonable minds might differ. Emailing pornography to a friend or other willing recipient is objectively a less serious breach of policy than emailing pornography to unwilling recipients or for the purposes of harassment.

[65] Particular conduct may breach a policy so as to constitute a valid reason but dismissal for that conduct without prior specific warning may be harsh. For example, an employer may have a policy against swearing in the workplace. Such a policy is supported by the same key reason justifying an anti-pornography policy. Swearing in a workplace can lead to an environment where the risk of abuse, harassment and victimisation, and thus the potential legal liability of the employer, is increased. In each case the policy furthers the legitimate interest of the employer to maintain a workplace where conduct that may cause offence to other employees is minimised. However, one can readily hypothesise a case where the breach of a swearing policy would not be seen by any reasonable person as justifying dismissal. In a workplace where swearing occurs without warnings or disciplinary response, selecting a single instance of swearing by a stressed employee with long and unblemished service as a basis for dismissal would be seen by any reasonable person as harsh and unfair.

[66] In Byrne McHugh and Gummow JJ endorsed the decision in Lane v Arrowcrest Group Pty Ltd (1990) 27 FCR 427 at 456 in the following terms (1995) 185 CLR 410 at 467:

“...von Doussa J considered the example of the dismissal of an accountant who held a position of trust where it was discovered after the dismissal that the accountant had been systematically embezzling money from the employer. His Honour said it would be astonishing if the employer could not resist an allegation that the dismissal was harsh, unjust or unreasonable, within the meaning of the relevant award, by pointing to those facts discovered after the dismissal, so long as they concerned circumstances in existence when the decision was made. His Honour concluded: “Whether the decision can be so justified will depend on all the circumstances. A circumstance, likely to favour the decision to dismiss, would be that fraud or dishonesty of the employee had caused or contributed to the employer’s state of ignorance. A circumstance likely to weigh against the decision would be that the employer had failed to make reasonable inquiries which would have brought existing facts to its knowledge before the dismissal occurred.”(underline emphasis added)

[67] Thus, a failure to monitor compliance or enforce a policy can be a relevant factor that weighs against a finding that a dismissal for breach of the policy was not harsh, unjust or unreasonable. If widespread breaches of policy, of the sort that occurred in this case, occur without an employer response then this weighs against a decision that the dismissal was justified and not harsh, unjust or unreasonable.’

[119] I agree with the Vice President and respectfully adopt the reasoning in B, C and D v Australian Postal Corporation. Given that there could be no serious dispute that the applicant had breached the Company Standard and for the reasons which I will be expand on later, I am satisfied there was a valid reason for the applicant’s dismissal (ss(a) of s 387 of the Act).

The Company Standard

[120] It is obvious that the Company Standard makes no actual mention of the figure of 15 g/L in any of its provisions. The applicant’s case seems to rest almost exclusively on the following proposition: that he was never told there was a different cup screening standard to the Laboratory standard. Putting aside for the moment the conflicting evidence of what the applicant was told and when, in my view, any fair minded reading of the Company Standard indicates that there must be two separate ‘cut off’ levels. It can be safely assumed - as I am sure anyone in the mining industry would agree - that a laboratory tested sample is going to be far more accurate than a site screening cup test which is limited to detecting levels above 50 g/L. I am also satisfied that it is well known in the industry, and deliberately recognised in the Company Standard, that the testing technology is such that screening cup tests cannot detect the presence of cannabis below 50 g/L. After all, why would the Company Standard refer to sending non-negative results to the Laboratory for testing against the Australian Standard, if the only expectation of management was that a screening cup test reading not above 50 g/L was all that was required to attend for work. As a mine employee of seven years experience, I do not accept that the applicant was in any doubt, that the final test after three weeks was to be in accordance with the Australian Standard and the Company Standard. Moreover, it is difficult to reconcile the applicant’s claim that he was self testing, drinking plenty of water and exercising to rid himself of any residual THC in his system, with his other evidence that he believed his result was low and would be negative after three to four days, when it was still 18 g/L after 22 days (assuming no further use during this period - which I accept).

[121] Of course, one should also not lose sight of the fact that random testing is of itself, designed to act as a deterrent to employees compromising themselves and their colleagues safety, by turning up for work under the influence of drugs or alcohol. Until the technology improves its accuracy and efficiency, it is simply not practical or realistic that every random test be sent for Laboratory confirmation. On one view, employees should not be critical for, in effect, being given a second chance. The Company Standard is not a zero tolerance policy, as is the case in many other employer drug and alcohol policies.

[122] Nevertheless, in my view, employees must always appreciate and be cognisant of the fact that the Company Standard provides for compliance with the Australian Standard after a first non-negative or positive result and a three week interregnum to achieve that standard, notwithstanding the cut off level of the cup test is over three times higher. Employees ignore this requirement, at their peril. It is akin to playing Russian roulette to continue to pass screening cup tests by hoping these tests would not exceed levels of 50 g/L. I note that simply passing the site screening cup test does not guarantee no further testing. Another employee or supervisor may have a reasonable belief, that the screening cup test of another employee should be sent direct to Laboratory testing, as provided for in the Company Standard. If an employee is prepared to take this gamble, then they cannot complain about the consequences under the disciplinary process. It is well recognised and set out in the Company Standard. There is no doubt employees are inducted, trained and updated on the Company Standard.

[123] In one sense, it is not relevant that the applicant claims he knew nothing about the 15 g/L (although I do not believe him). This was not a race to see if you can get under a predetermined test reading. It would appear the applicant was taking positive steps to try to expel the drug remnants (residue from his body). He knew he was on shaky ground and had told Mr Hall he may fail a second test. In other words, the applicant was taking an enormous risk in trying to beat the system whether the level was 15 or 50 g/L.

[124] In my opinion, whether the applicant was self-testing, whether the Company provided him with the self-tests cups and even if Mr Hall had told him ‘He should be fine’, is not the point. To focus on this evidence was to deflect attention from the very serious breach of the Company’s drug and alcohol policy, which is directly related to ensuring a safe work environment in a safety critical industry.

[125] The Commission notes Mr Endacott’s submission that the applicant did not receive the warning letter for the 15 March failed test, until 6 April 2017, or the test results in writing (although it must be said he never asked for them either). However, there can be little doubt that the applicant was under no misapprehension of what was expected of him after the first positive test. Indeed, his own actions plainly demonstrate he knew the significance of the requirement to pass a test within three weeks and was actively seeking to reduce his THC level by running and drinking lots of water. I believe he knew what was going to happen and the consequences of a final positive test.

Observations on the evidence

[126] Regrettably, but perhaps not surprisingly, the applicant was so determined to convince the Commission he should get his job back, that his evidence was littered with implausible and fanciful explanations and blatant inconsistencies. Given this observation, I have little confidence that he was a witness of credit or that his evidence on crucial contested matters was believable. His performance in the witness box was not explicable due to nervousness, stress or unfamiliarity with the process of cross examination. I do not believe that the applicant understood, or was prepared to accept, the magnitude of his conduct or the serious risk he posed to himself and his fellow employees.

[127] That said, as I observed earlier, it is not strictly necessary for the Commission to make findings as to the extent of the applicant’s marijuana use. However, the applicant’s dogged denials that he was not a regular user - which I firmly reject - calls into question his evidence, unless it was not disputed or otherwise corroborated. I explain further.

[128] The applicant gave evidence that the only time in over 10 years that he used marijuana was when he had two joints on Friday, 10 March 2017 after finishing his shift and he then just happened to have a reading of 65 g/L when he was randomly tested five days later. I do not accept this evidence for the following reasons.

1. It is difficult to reconcile the applicant’s one off drug use in over ten years, with his belated explanation that he had been using marijuana to relieve pain from an historic workplace injury.

2. The applicant claimed Mr Linde, Mr Hall and Mr Taylor all knew he was using marijuana for medical reasons. All three denied this assertion. Mr Linde said that he was never made aware of this explanation. Mr Hall denied the applicant raised it with him during the drive home with the applicant on 15 March 2017. I accept the evidence of Mr Linde, Mr Hall and Mr Taylor.

3. I reject the applicant’s medical explanation as to why he was using marijuana. It is instructive that the applicant did not mention this explanation at all in either:

(a) his F2 application filed on 27 April 2017;

(b) his first statement filed on 8 August 2017; or

(c) when he replied to Mr Taylor’s statement.

It was never put to Mr Hall in cross-examination, that he had been told of the applicant’s medical reason for using marijuana. In addition, the applicant did not tell Mr Taylor or Mr Hall that he had only had two joints on Friday 10 March 2017 after work.

4. It is strange that the applicant admitted he had not discussed with his Doctor using marijuana to relieve the effects of the prescribed pain killers. One might expect he would have asked his Doctor of any side effects by mixing marijuana with other prescribed medications. It appears (if true) that he simply self diagnosed.

5. The applicant claimed he told Mr Linde and Mr Hall of his medical explanation in the meeting of 6 April, 2017. Both Mr Linde and Mr Hall denied this. Given that the applicant had a support person at this meeting (Mr Lidwinski), it is curious why Mr Lidwinski did not provide a statement or was not called to corroborate the applicant’s claim.

6. It is also difficult to reconcile the applicant’s one off usage, with Mr Hall’s evidence that the applicant had told him in 2014 that he used marijuana. Mr Hall was not seriously challenged on this evidence. I accept Mr Hall’s evidence in this respect.

7. From my misunderstanding of the scientific literature, it is extremely unlikely that a person who smoked two joints and tested 65 g/L five days later and tested again 22 days later at 18 g/L, was a one-off user. I rely on a scientific research paper referred to by Cambridge C in Construction, Forestry, Mining and Energy Union-Construction and General Division v Port Kembla Coal Terminal Limited [2015] FWC 2384 at para 47:

‘[47] Further, it is important to consider the scientific research which has been conducted into the long-term effects of regular cannabis consumption. In this case the Lee and Huestis paper added to the body of material which supports the concerns that were persuasively expressed by Professor Christie about the inadequate recognition of the effects of long-term cannabis use and what he believed to be the need to reduce the cut-off levels for THC and its predominant metabolite, 11-nor-9-carboxy-THC (THCCOOH) in the relevant Australian Standards. Relevantly, the Lee and Huestis paper included the following:

“In chronic cannabis smokers during abstinence, low THC concentrations were detected in blood for up to 30 days, and psychomotor performance in tasks validated to predict on-the-road impairment remained impaired compared to occasional smokers for 21 days. In other studies, neurocognitive performance improved over 30 days in chronic frequent cannabis smokers, but was still impaired compared to occasional smokers for 7-28 days.”’

8. Further scientific evidence put in this case disclosed that in order for cannabis to be detected in the system of the average person more than 14 days after use, one has to be a chronic user. In a Drugs and Human Performance Fact Sheet tendered in the proceeding, the following appears:

Interpretation of Urine Test Results: Detection of total THC metabolites in urine, primarily THC-COOH-glucuronide, only indicates prior THC exposure. Detection time is well past the window of intoxication and impairment. Published excretion data from controlled clinical studies may provide a reference for evaluating urine cannabinoid concentrations; however, these data are generally reflective of occasional marijuana use rather than heavy, chronic marijuana exposure. It can take as long as 4 hours for THCCOOH to appear in the urine at concentrations sufficient to trigger an immunoassay (at 50ng/mL) following smoking. Positive test results generally indicate use within 1-3 days; however, the detection window could be significantly longer following heavy, chronic, use. Following single doses of Marinol, low levels of dronabinol metabolites have been detected for more than 5 weeks in urine. Low concentrations of THC have also been measured in over-the-counter hemp oil products – consumption of these products may produce positive urine cannabinoid test results.

Performance Effects: The short term effects of marijuana use include problems with memory and learning, distorted perception, difficultly in thinking and problem-solving, and loss of coordination. Heavy users may have increased difficulty sustaining attention, shifting attention to meet the demands of changes in the environment, and in registering, processing and using information.

Panel’s Assessment of Driving Risks: Low doses of THC moderately impair cognitive and psychomotor tasks associated with driving, while severe driving impairment is observed with high doses, chronic use and in combination with low doses of alcohol The more difficult and unpredictable the task, the more likely marijuana will impair performance.

In the Douglass Hanly Moir Toxicology Report also tendered in the proceedings a table at page 2 records as follows:

Even allowing for some individual variances, according to a person not being the ‘average’, in this case the applicant still had detectable levels of marijuana above the Australian Standard some 27 days after claiming he only had two joints in over 10 years. On any objective analysis, this claim is utterly implausible.

9. When questioned about his knowledge of the body’s retention of THC, the applicant said he had read all about it and believed that if he was a daily user, it would be detectable for up to three months. Then when asked if he had only had two joints, it would be detectable for only one to two days, he answered ‘I don’t know about that’.

10. If the applicant only had two joints in over ten years, it beggars belief why he would be fearful of not passing another test, three weeks after he was stood down and why he had told Mr Taylor that he was jogging and drinking lots of water in an effort to rid any THC trace from his system. In my view, the applicant knew full well he was a doubtful proposition of passing the Australian Standard and pinned his hopes of passing the screening cup standard (of 50 g/L), even though he knew that this was not what the Company Standard required. When he failed the Australian Standard on 6 April 2017, he then blamed Mr Hall for allegedly telling him he only had to pass the screening cup test to be able to return to work. I do not accept his evidence in this respect. It does not make sense that Mr Hall would tell any employee, in such a serious situation, they only had to meet the screening cup cut off to go back to work, when that was clearly contrary to the Company Standard. In any event, given my reluctance to accept the applicant’s evidence, unless it was corroborated, I believe the applicant was told the results of his first test and he was told that he had to meet the Lab Standard.

11. The applicant had received a copy of the Company Standard a few days after 15 March 2017 and he could not be in any doubt what cl 3.2 meant, particularly the last sentence ‘If a screening test exceeds these levels, it is then tested using an accredited laboratory that provides the final confirmatory result. AS/NZ 4308:2008 sets out the confirmatory test cut-off levels.’ To suggest an employee who was facing dismissal, did not carefully read the Company Standard or seek advice from his Union, if he was unsure or did not understand its requirements, is incomprehensible and illogical.

12. Perhaps most damning of all, was the 2014 report of Dr Haque which described the applicant as a ‘regular marijuana user’. The applicant’s explanation for this entry was creative, but unbelievable. He claimed this was merely a reference to a medical report from 20 years ago, when he was 21 years of age. He claimed this reference had not been removed since then and reappeared on his 2014 medical report, when his medical history passed through three medical centres. Putting aside the inherit unlikelihood a medical report for workers’ compensation purposes not being current and up to date, and would include historic 20 year old irrelevant information, the applicant could have sought a statement from his own Doctor or call the Doctor to give evidence. Given this was the crux of the applicant’s defence, and suspiciously belated, a Jones v Dunkel (1959) 101 CLR 298 inference must be open in this respect.

[129] Other of the applicant’s evidence which I reject, includes the following:

[130] I have not set out every instance of conflicting evidence between the applicant and Mr Linde, Mr Hall and Mr Taylor. Nevertheless, given the forgoing examples, I am comfortably satisfied that where their evidence is in conflict with the applicant’s evidence, it is their evidence which is to be preferred.

Further matters to be considered under s 387 of the Act

[131] Subsections (b)-(c) of s 387 are generally headed under the rubric of ‘procedural fairness’ or ‘natural justice’ issues. . To highlight the importance of procedural fairness issues, I cite three authorities on the subject in unfair dismissal cases. In Crozier v Palazzo Corporation Pty Limited t/as Noble Storage and Transport (2000) 98 IR 137 (‘Crozier v Palazzo’), a Full Bench of the AIRC said at para [73]:

‘As a matter of logic procedural fairness would require that an employee be notified of a valid reason for their termination before any decision is taken to terminate their employment in order to provide them with an opportunity to respond to the reason identified. Section 170CG(3)(b) and (c) would have very little (if any) practical effect if it was sufficient to notify employees and give them an opportunity to respond after a decision had been taken to terminate their employment.’

[132] In Wadey v YMCA Canberra [1996] IRCA 568, Moore J made clear that an employer cannot merely pay ‘lip service’ to giving an employee an opportunity to respond to allegations concerning an employee’s conduct. His Honour said:

‘In my opinion the obligation imposed on an employer by that section has, for present purposes, two relevant aspects. The first is that the employee must be made aware of allegations concerning the employee's conduct so as to be able to respond to them. The second is that the employee must be given an opportunity to defend himself or herself. The second aspect, the opportunity to defend, implies an opportunity that might result in the employer deciding not to terminate the employment if the defence is of substance. An employer may simply go through the motions of giving the employee an opportunity to deal with allegations concerning conduct when, in substance, a firm decision to terminate had already been made which would be adhered to irrespective of anything the employee might say in his or her defence. That, in my opinion, does not constitute an opportunity to defend.’

[133] Nevertheless, procedural fairness steps should be applied in a commonsense and practical way. In Gibson v Bosmac Pty Ltd (1995) 60 IR 1 (‘Gibson’), Wilcox CJ said at 7:

‘Ordinarily, before being dismissed for reasons related to conduct or performance, an employee must be made aware of the particular matters that are putting his or her job at risk and given an adequate opportunity of defence. However, I also pointed out that the section does not require any particular formality. It is intended to be applied in a practical, commonsense way so as to ensure that the affected employee is treated fairly. Where the employee is aware of the precise nature of the employer's concern about his or her conduct or performance and has a full opportunity to respond to this concern, this is enough to satisfy the requirements of the section.’

[134] It goes without saying that any issue/s of procedural unfairness may not be of such significance as to outweigh the substantive reason/s for an employee’s dismissal, particularly in cases of misconduct where the proven misconduct is of such gravity as to outweigh any other considerations in respect to harshness, such as age, length of service, employment record, contrition or personal and family circumstances. In Bostik Australia Pty Ltd v Gorgevski (No 1) [1992] FCA 271; 36 FCR 20, the Federal Court of Australia Industrial Division said at 37:

Harsh, unjust and unreasonable

37. These are ordinary non-technical words which are intended to apply to an infinite variety of situations where employment is terminated. We do not think any redefinition or paraphrase of the expression is desirable. We agree with the learned trial judge’s view that a court must decide whether the decision of the employer to dismiss was, viewed objectively, harsh, unjust or unreasonable. Relevant to this are the circumstances which led to the decision to dismiss and also the effect of that decision on the employer. Any harsh effect on the individual is clearly relevant but of course not conclusive. Other matters have to be considered such as the gravity of the employee’s misconduct.’

Whether the person was notified of that reason (s 387(b))

[135] While the applicant was notified of the reason for his dismissal on the day it took place (12 April 2017), he was not in any doubt, at least from the phone call from Mr Taylor on 3 April (see para [29] above), that his future employment was in jeopardy, unless he returned a negative drug test result. More likely he was aware that his job was at risk when Mr Hall informed him on 23 March 2017 of the positive reading from the Lab analysis. Indeed, he must have known from that point, because of the self testing and the extra physical regime he undertook in an effort to rid traces of THC from his system in the following two weeks. This factor tells against a finding of unfairness.

Whether the person was given an opportunity to respond to any reasons related to the conduct of the person (s 387(c))

[136] The applicant had numerous opportunities to respond to the allegations in phone conversations with Mr Hall and Mr Taylor and at the 6 and 12 April 2017 meetings. As mentioned earlier, his belated response of medical reasons for using cannabis, was not put until after he was dismissed. His earlier responses were not to deny the allegations, but claim that it was either Mr Hall’s fault and that he was unaware of two ‘cut off’ levels and then plead his family and personal circumstances. I have commented on all these matters in this decision. I am satisfied the applicant understood the allegations and was provided with reasonable opportunities to explain his actions and give reasons why he should not be dismissed. He was not pressured into responding in an untimely manner. It is of little consequence that he did not receive the warning of 15 March 2017, in writing, until 6 April 2017, or that he did not himself respond, in writing, at any time from 23 March 2017. This factor tells against a finding of unfairness.

Any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal (s 387(d))

[137] At both meetings of 6 and 12 April 2017, the applicant was supported by a support person. As noted earlier, neither of them gave statements or were called to give evidence to corroborate the applicant’s versions of the conversations in these meetings, where it conflicted with Mr Linde’s and Mr Taylor’s evidence. In addition, I am satisfied that the applicant would have had an opportunity to consult with, and take advice from his Union about his circumstances. This factor tells against a finding of unfairness.

If the dismissal related to unsatisfactory performance by the person - whether the person had been warned about that unsatisfactory performance before the dismissal (s 387(e))

[138] As this was a case of summary dismissal for serious misconduct, this factor is not necessarily relevant for present purposes. However, I note that according to the Company Standard, the applicant had received warnings of the likelihood of dismissal, if he failed a second Lab test. In any event, warnings were hardly necessary in circumstances where the applicant had been inducted, trained and updated on changes to the Company Standard, which expressly set out the consequences of breaches of the Standard. No findings of unfairness arise under this subsection of s 387.

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 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 (ss 387(f) and (g))

[139] The employer is a large employer in the mining industry. Its industrial relations processes reflect its size, the critical importance it places on safety, its dealings with a well resourced and experienced Union and its commitment to a fair process in dealing with disciplinary matters. I find no fault in its handling of the applicant’s dismissal. The facts were obvious, the expectations of employees under the Company Standard were well known and explained. The consequences of major breaches of the Company Standard were clear and in conformity with contemporary community and industrial expectations. In my view, the applicant was treated fairly and in accordance with due process and natural justice.

Any other mattes the Commission considers relevant (s 387(h))

[140] The applicant has paid a very high price for his conduct. He has lost a well paid job. I accept his dismissal has had a serious economic impact on his family. It may mean he will need to find work away from where he grew up and where he has extended family and friends. He may be required to be away from his family for lengthy periods or may be required to relocate them away from family and friends. I have taken this into account and have some sympathy for the circumstances the applicant has found himself in. However, that cannot be the end of the matter. In Parmalat Food Products Pty Ltd v Wililo (2011) 207 IR 243, the Full Bench of the Commission said at paras [18] to [19]:

‘[18] In our view this case raises important questions about the respective rights and obligations of employees and employers in relation to safety requirements at the workplace. Employers have important statutory obligations to maintain a safe place of work. Those obligations have a high profile in NSW. Establishing and enforcing safety rules are an important obligation, a breach of which can lead to serious consequences.

[19] In this case the employer considered, and established to the satisfaction of the Commissioner, that Mr Wililo had breached its safety rules and his conduct amounted to serious misconduct. Clearly disciplinary action was necessary and appropriate because a failure to do so sends a message to the workforce that safety breaches can occur with impunity. The application of the unfair dismissal provisions to this case is a matter of general importance and in our view clearly attracts the public interest. We therefore grant permission to appeal.’

And at [24] to [26] said:

‘[24] We do not consider that the decision discloses a clear line of reasoning leading to the decision reached. The existence of a valid reason is a very important consideration in any unfair dismissal case. The absence of a valid reason will almost invariably render the termination unfair. The finding of a valid reason is a very important consideration in establishing the fairness of a termination. Having found a valid reason for termination amounting to serious misconduct and compliance with the statutory requirements for procedural fairness it would only be if significant mitigating factors are present that a conclusion of harshness is open. We do not believe that any of the circumstances involved in this matter amount to such factors.

[25] It is not clear to us that in referring to other considerations under s 387(h) the Commissioner was suggesting that these were mitigating factors. If they were so considered we believe she fell into error. The service and disciplinary record of Mr Wililo was not a mitigating factor as his service was short and his disciplinary record was poor. The failure to show Mr Wililo the CCTV footage was not a matter of significance. It was largely inconclusive and could not have altered the conclusion that Mr Wililo had an adequate opportunity to respond to the allegations against him.

[26] Mr Wililo’s conduct was found to be serious misconduct. It involved deliberate acts. We consider that characterising the actions as carelessness does not derogate from the seriousness of his action or the possible consequences. Further we do not believe that there was a sufficient basis to find that the employer could not apply its safety standards because of alleged actions in relation to other safety breaches. If it was entitled to take the action in this case the need to enforce its safety rules suggests that the resultant termination is not harsh.’

[141] I have also taken into account the applicant’s unreliability as a witness, and his attempts to ‘whitewash’ his conduct or blame others for what he knew to be wrong – profoundly wrong. The risk he posed to himself and to his fellow employees on 13, 14 and 15 March 2017, with such elevated levels of THC in his system, and the risk I believe he continues to pose to them, is so gravely serious that dismissal was, in my opinion, the only course of action open to Whitehaven. The possible consequences of his conduct could have been catastrophic.

[142] I do not intend to interfere with Whitehaven’s decision to dismiss Mr Eather. His dismissal was neither ‘harsh, unjust or unreasonable’, within the meaning of s 387 of the Act. His application for an unfair dismissal remedy must be dismissed. An order to that effect will be issued contemporaneously with this decision.

DEPUTY PRESIDENT

Appearances:

Mr K Endacott for Jarrod Eather.

Mr A Britt of Counsel with Mr A Bland, Solicitor, for Whitehaven Coal Mining Limited t/a Narrabri Coal Operations Pty Ltd.

Hearing details:

2017.

Tamworth: August 23.

Sydney: September 29.

Printed by authority of the Commonwealth Government Printer

<Price code J, PR599481>