PR908351

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AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION

Workplace Relations Act 1996

s.45 appeal against decision and order [Prints PR900786 and PR900791]

issued by Commissioner Wilks on 31 January 2001

Ricegrowers Co-operative Limited

(C2001/319)

s.170CE application for relief re termination of employment

Brendan Troy Schliebs

and

Ricegrowers Co-operative Limited

(U No. 20692 of 2000)

SENIOR DEPUTY PRESIDENT DUNCAN

SENIOR DEPUTY PRESIDENT CARTWRIGHT

COMMISSIONER LARKIN

SYDNEY, 31 AUGUST 2001

Appeal - termination of employment - application of s.170CG(3) and s.170CH.

DECISION

[1] On 21 February 2001 Ricegrowers Co-operative Limited (Ricegrowers) filed an appeal against the decision [PR900786] and order [PR900791] of Wilks C issued 31 January 2001 in the matter of an application by Brendan Troy Schliebs seeking relief for termination of his employment by Ricegrowers on 23 June 2000.

[2] The relevant parts of the decision are in paragraphs 6 and 28-49:

[3] The order is in the following terms:

[4] The appeal was lodged on 21 February 2001. On 28 February 2001, an order was issued by consent staying the operation of paragraph A3 of the order of Wilks C of 31 January 2001. It emerged during the stay proceedings on 28 February that Mr Schliebs had resumed working for Ricegrowers at the co-operative's Colleambally mill on 5 February 2001.

[5] In K. Dahlstrom and ors and Wagstaff Cranbourne Pty Ltd [Print T1001] another Full Bench described the functions we are called on to perform:

[6] We take as our point of departure the comments of McHugh J in re Commonwealth of Australia; ex p. Marks [(2000) HCA 67 (14 December 2000)]:

[7] The grounds of appeal in this matter are the appellant's claims of error on the part of the Commissioner. They may be grouped under three heads and we examine them in that fashion. Grounds 1, 2 and 3 go to whether or not there was a valid reason for the termination. Grounds 5 to 9 are concerned with certain evidentiary matters and related matters which we group under Evidentiary and other Matters. Grounds 10 and 11 concern remedy.

[8] Before considering the grounds we set out s.170CG(3) which delineates the matters the Commissioner must have regard to. Section 170CG(3) states:

(e) Any other matters that the Commission considers relevant."

[9] We turn now to consider the grounds of appeal.

Valid Reason

[10] There is no doubt that s.170CG(3)(a) obliges the Commission to make a finding as to whether of not there was a valid reason for the termination of employment.

[11] The reason must be "sound, defensible or well founded" as the oft-repeated dictum of Northrop J in Selvachandran v. Peteron Plastics Pty Ltd [(1995) 62 IR p. 371 at 373] has it. In this case the Commissioner's approach to whether the reason for termination was "sound, defensible or well founded" would appear unexceptional. It is hardly a defensible reason for punishment if that punishment is inappropriate to the circumstances. Another reason not well founded would be if it were inconsistent with what had occurred elsewhere in similar circumstances.

[12] The basis for the first ground of attack is that because the facts were clear the finding that there was no valid reason could not be sustained. We disagree. The circumstances in which those facts occurred is relevant to the issue whether or not there was a valid reason for termination. In this regard the reason for termination must be considered in the context of the penalty of termination and such a penalty must among other things be proportionate to the reason relied upon.

[13] Further, on the first ground, we do not believe the Commissioner's reference to serious and wilful misconduct was an assertion that it was necessary for the appellant to prove serious and wilful misconduct in the common law sense. We agree with the submission that Annetta v. Ansett Australia Ltd [Print S6824] makes the point that determining whether the conduct of the respondent justified termination does not involve consideration as to whether at common law the conduct of the respondent would justify summary dismissal. We consider the Commissioner's reference to:

was a restatement of the view that what occurred did not warrant dismissal. It was not a statement that it was necessary to establish serious and wilful misconduct before there could be a valid reason for termination.

[14] As to the second ground we repeat our opinion on the relevance of the context in which the termination occurred. As for the relevance of the penalty being disproportionate we adopt, with respect, the analysis of Moore J in Edwards v. Giudice and ors [169 ALR 89 at 92]. With reference to s.170CG(3)(a) his Honour said:

[15] We take this to be a firm statement that the proportion of the penalty to the offence is relevant to validity for the termination. The reliance on the Echuca incident is relevant to the question of proportion and therefore appropriately considered when considering whether or not there was a valid reason for the termination. The Ricegrowers management at Colleambally mill thought that there was a significant difference between the two incidents - see exhibit B9, the statement of Mr Townsend, the mill manager at Colleambally in which the significant difference is stated to be that the employee concerned was not on company property at the time of the incident. Mr Schliebs was. However there was evidence before Wilks C which left it open to him to reach the conclusion that he did that the Colleambally case was less serious than the Echuca incident.

[16] It is then said that it was an error to consider the failure of the employer to provide evidence of regularly bringing its hygiene policy to notice. We are satisfied that its consideration is not an error in the circumstances of this case. It is, in the manner in which it was expressed by the Commissioner, relied on only as an explanation of his finding that the employee was not aware of the policy at the time of the incident. It is not an independent reason for the Commissioner's finding that there was no valid reason for termination.

[17] In our approach to these grounds we accept the submission by the appellant that s.170CG(3)(a) focuses on the reason for termination. However, we do not think that there is any limit, other than relevance, on what may be considered in reaching a conclusion that there is, or is not, a valid reason for termination. It is noteworthy that the legislation does not require the Commission to find that there is a valid reason for any form of disciplinary action rather whether "there was a valid reason for the termination". If it is not a reason for termination it is not valid for the purposes of s.170CG(3)(a). There are some matters which are not relevant. An example is the question of the effect of termination on the employee. Container Terminals Australia Limited v. Toby [Print S8434]. The Full Bench in that case held:

[18] But what may be considered in relation to s.170CG(3)(a) is broad. An example is given in GrainCorp Operations Limited and Richard Stephen Vallette [Print PR902074]. In that decision the Full Bench said:

[19] In the present case, the findings which led the Commissioner to his conclusion on s.170CG(3)(a) were related to the conduct of the employee. He observed that the employee had attempted to find an alternative place to urinate, that there was no impact on hygiene, that there was an issue of the degree to which the policy was breached in the circumstances and of Mr Schliebs' lack of awareness of the policy at the time the conduct occurred. These are all relevant to the conduct of the applicant and go to whether or not the reason for termination was valid in the sense that it could be described as "sound, defensible or well founded". It is necessarily implicit in the Commissioner's decision that the reason did not meet this test for the reasons he advanced. We find no error in his relying on these factors to assess the validity of the reason. Providing the rationale for a finding under s.170CG(3)(a) that a termination was not for a valid reason is both logical and based on probative material we are of the view that the finding should not be disturbed. We are satisfied that there was sufficient evidence to enable Wilks C to reach the factual conclusions he relied on in finding there was not a valid reason for termination. The mention of alternative action in the form of a warning is perhaps unnecessary but does not constitute an error within s.170JF(2).

Evidentiary and Other Matters

[20] This ground was not pursued.

[21] We do not accept the submission that the finding that at the time of the incident Mr Schliebs was not conscious of the existence of Ricegrowers hygiene policy was not supported by the evidence. Mr Schliebs gave evidence that he was not aware at the time [see PN211, 321, 347] and the Commissioner had the benefit of observing the witness giving his evidence. The conclusion he reached in paragraph [35] of his decision was reasonably open to him.

[22] The appellant argues that Wilks C erred in finding that the Respondent did not receive an adequate opportunity to respond to the reason. It is somewhat of a moot point, given that we have found no error in the Commissioner's finding that there was not a valid reason for termination. Mr Mehan for the respondent, took this approach at the hearing, simply relying on Chubb Security Australia Pty Ltd and John Thomas [Print S2679, paragraph [41]]:

[23] He submitted that s.170CG(3)(c) had no application since there was no valid reason. We agree.

[24] The attack on the finding [in paragraph [43] of the decision] that the conduct of Mr Schliebs was not serious and wilful misconduct for the purposes of the Agreement was that the actions of Mr Schliebs were committed with knowledge that they were in breach of the hygiene policy and that that policy was a lawful and reasonable policy. We agree with the view that the policy was lawful and reasonable. We are unable, for reasons given earlier [paragraph [20] hereof] to agree that the act was in knowing breach of the policy. The phrase is serious and wilful misconduct and we have no reason to hold the Commissioner was in error, by in effect, not finding the misconduct "wilful".

[25] The appellant submits that it is inappropriate to consider under s.170CG(3)(e) the effect of termination on Mr Schliebs who lives in a relatively small community. It is inappropriate it is said, because such consideration will adversely impact on employers in regional and rural communities. It is said that the effect is that a termination which is not harsh, unjust or unreasonable in a larger community may become so because the employer operates in a smaller community. Further, it is said, there was no evidence to support the conclusion.

[26] It is well established that it is permissible to consider the effects of termination on the personal or economic situation of the dismissed employee. It is only necessary to refer in support of this to the observation of McHugh and Gummow J in Byrne v. Australian Airlines Ltd [131 ALR 422 at 461]:

[27] It is not for us to introduce a restriction on what may be comprehended by s.170CG(3)(e) in light of this observation. As to the existence of the situation relied on the evidence is not great. There is an assertion in Mr Mehan's outline of submissions put before Wilks C:

However, we can find no indication of the statement being contradicted. We also consider that the Commissioner is calling upon a general awareness of the situation. In the circumstances we do not think the reliance on the statement is an appellable error.

[28] Mr Schliebs found only casual employment during the period between the termination and the hearing below. That was in evidence before the Commissioner. In the absence of contrary evidence on employment options, that provided a basis for the conclusion drawn by the Commissioner.

Remedy

[29] We turn now to the remedy ordered for lost remuneration, the calculation of which is challenged by these grounds. They attack the concept behind and the detail in the calculation of the amount ordered by the Commissioner pursuant to s.170CH(4)(b) of the Act. We deal with them as one. It is noted that no attack in principle is made on the decision to award an amount in respect of the remuneration lost.

[30] Section 170CH(4)(b) is to the following effect:

[31] The appellant submitted that the errors were:

[32] On the seasonal nature of the employment we note that there was no evidence of this before the Commissioner in any way which would have enabled him to make provision for it. In those circumstances failure to allow for the alleged seasonal effect does not constitute error.

[33] However the respondent, through Mr Mehan, conceded that (ii) was an error and we are satisfied that it was. The evidence before the Commissioner was to the effect that he earned from $2000 to $2500 from casual work on farms in addition to $6020 shown through bank statements [exhibit B6].

[34] As for (i), we are of the view that that failure, in the circumstances of the case, was an error. The material was before the Commissioner. Further, we note that the payment was similar in that it was voluntary to a payment taken into account by Ross VP in Fetz and ors v. Qantas Airways Ltd [Print P6706].

Conclusion

[35] We find no error in that part of the decision which found that the termination of Mr Schliebs' employment was harsh, unjust and unreasonable. We regard the failure to take account of all earnings and payments in calculating the remuneration lost as an error of the kind contemplated in House v. R [(1936) 55 CLR 499 at 504-5] - a failure to take into account a material consideration. It is an error within the contemplation of s.170JF of the Act. The remedy to correct the error is available on the evidence reviewed by us and does not require the admission of further evidence.

[36] For the reasons given we have decided as follows:

[37] Pursuant to s.45(7)(a) of the Act, we confirm paragraphs 1 and 2 of the order of Wilks C and vary paragraph 3 to provide as follows:

[38] We revoke the stay issued on 28 February 2001.

BY THE COMMISSION:

SENIOR DEPUTY PRESIDENT

Appearances:

B. O'Donnell for the appellant.

D. Mehan for the respondent.

Hearing details:

2001.

Sydney:

June 6.

Printed by Authority of the Commonwealth Government Printer

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