Adrian Orsborn v GM Holden Ltd

[2010] FWA 7356

Note: An appeal pursuant to s.604 (C2010/5295) was lodged against this decision.

[2010] FWA 7356

FAIR WORK AUSTRALIA

DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

Adrian Orsborn
v
GM Holden Ltd
(U2010/8914)

SENIOR DEPUTY PRESIDENT O'CALLAGHAN ADELAIDE, 29 SEPTEMBER 2010

Termination of employment - worker’s compensation claim - failure to disclose alternative employment - valid reason - termination procedure.

[1] On 19 May 2010 Mr Orsborn lodged an application pursuant to section 394 of the Fair Work Act 2009 (the Act), seeking relief with respect to the termination of his employment by GM Holden Ltd (GMH). Mr Orsborn’s application was the subject of conciliation on 26 June 2010. It was referred to me on 1 September 2010 for arbitration. The arbitration occurred on 8 and 9 September 2010.

[2] In these proceedings Mr Orsborn was represented by Ms Nachiappan of counsel and GMH by Mr Cole of counsel.

[3] There is little dispute over the background to the application.

[4] Mr Orsborn worked for GMH from 1997 until the termination of his employment on 5 May 2010. In June 1997 Mr Orsborn suffered a compensable lower back injury. He received worker’s compensation payments and was subsequently placed on modified duties. These restrictions continued to apply until the termination of his employment.

[5] In 2006 Mr Orsborn was promoted to a position of backup Work Group Leader.

[6] Around October 2008 GMH reduced working hours in consultation with various unions representing employees in response to a downturn in the motor vehicle manufacturing industry. These reduced work arrangements remained in operation for the duration of Mr Orsborn’s employment. The effect of these arrangements was that, for a time, Mr Orsborn worked normal duties on alternate weeks and was paid a wage of 50% for the alternate week.

[7] The arrangements put in place by GMH over this time facilitated employees generally to pursue other employment opportunities provided GMH could continue to meet its labour requirements.

[8] In May 2009 Mr Orsborn obtained a second job as a pizza delivery driver with Cafe Verde Pizzeria (the Pizzeria). He held this casual position until at least late March 2010. Mr Orsborn did not advise GMH of his second job but, with the exception of the matters addressed in this decision, there does not appear to be a specific instruction to this effect.

[9] Subsequent to obtaining this second job, on 26 October 2009 Mr Orsborn lodged a claim with GMH for worker’s compensation top up pay with respect to the reduction of his working hours. When he completed the Worker Report Form, he did not complete that part of the form that required advice that he had a second job. These top up payments were subsequently agreed on a retrospective basis by GMH. GMH is an exempt employer and manages its own worker’s compensation claims. Mr Orsborn’s failure to declare the second job when he completed the form was not material to the quantum of the top-up payments.

[10] On, or around 25 February 2010 Mr Orsborn reported to GMH management that he had further injured his back. He was allocated revised duties and was provided with physiotherapy at the GMH Medical Centre.

[11] On 3 March 2010 Mr Orsborn attended for work at GMH. He undertook his normal duties for a period of time before being referred to an alternative restricted duties work area to undertake sweeping duties. Subsequent to his work at GMH Mr Orsborn undertook his second job at the Pizzeria.

[12] On 4 March 2010 Mr Orsborn advised GMH that he was unwell and, in the afternoon, he attended Dr Chang. Dr Chang had been his consulting general practitioner for many years. Mr Orsborn did not advise Dr Chang of his Pizzeria job.

[13] Dr Chang assessed Mr Orsborn’s back condition and issued a Prescribed Medical Certificate (PMC) which specified that Mr Orsborn was unfit for work from 4 March 2010 to 12 March 2010. Dr Chang referred Mr Orsborn to a physiotherapist, Mr Chang.

[14] Mr Orsborn left Dr Chang’s premises and proceeded directly to his Pizzeria job. He continued to work at this Pizzeria job at various times over the following week.

[15] On 5 March 2010 Mr Orsborn presented the PMC to GMH. He did not attend GMH for work until the expiry of this PMC. On 10 March 2010 Mr Orsborn attended the GMH Medical Centre and submitted a WorkCover claim form, supported by his PMC. This claim form was completed such that it confirmed that Mr Orsborn did not have a second job. The parties are in dispute over the basis upon which this part of the form was completed. Mr Orsborn also saw a GMH doctor that day.

[16] Mr Orsborn subsequently returned to work. GMH management became aware that Mr Orsborn could have had another job over that time and commenced investigations, which included covert surveillance. In late April or early May, GMH human resource management personnel were provided with a copy of this surveillance report, which included video film of Mr Orsborn working for the Pizzeria and using his GMH leased vehicle to undertake the pizza delivery work.

[17] Mr Orsborn was requested to attend a meeting with senior GMH personnel on 5 May 2010. The senior shop steward from the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers’ Union (AMWU) in Mr Orsborn’s work area was also asked to attend. No advance warning of the meeting, or its purpose was provided. Soon after the commencement of the meeting, the senior shop steward, Ms Orbanic requested an adjournment to discuss the situation with another, more senior shop steward. This was agreed. During the meeting break Ms Orbanic telephoned an AMWU official, Mr Gee who advised her that she should inform Mr Orsborn to respond to any questions by saying that he was seeking legal advice and was not prepared to answer those questions.

[18] The meeting was reconvened with the second AMWU shop steward, Mr Brown, also present. After GMH put various allegations to Mr Orsborn the meeting was further adjourned to allow Mr Orsborn additional time to consider his position. A final adjournment subsequently occurred to enable GMH to consider Mr Orsborn’s responses. When the meeting resumed, GMH advised Mr Orsborn of the termination of his employment and provided him with a letter to this effect. He was subsequently asked to leave the site. The termination of employment letter stated:

“Re Termination of Employment

In our meeting today we discussed the 3 points mentioned in this letter below, which gave GM Holden a preliminary view, based on surveillance material that has been provided to us and the advice of our medical expert that you have now been honest in relation to your worker’s compensation claim. We then provided you with an opportunity to consider and review the information in our possession before responding to our concerns;

1. That you have misrepresented to our medical provider, rehabilitation providers and to GM Holden the extent of your disability in that you submitted a Prescribed Medical Certificate for a period from 4 March 2010 to 12 March 2010 for total incapacity when you were in the employ of Cafe Verde Pizzeria on both 4 March 2010 and 5 March 2010 for a period of more than 7 hours.

2. That you have misrepresented to our medical provider, rehabilitation providers and to GM Holden the extent to which you are incapacitated for work and your ability to undertake suitable employment duties which the company has made available to you.

3. That you are in breach of the Holden Employee Lease Agreement by using your lease vehicle to deliver pizza’s for Cafe Verde.

After carefully considering your response GM Holden notified you in the discussion with you Manager Ben Stewart and your Union representative, Leanne Orbanic, that you are summarily dismissed from your employment, effective 5 May 2010 on the grounds of Serious and Wilful Misconduct.

Any accrued untaken leave entitlements and monies will be deposited in your nominated bank account.

If you have any questions in relation to this decision please contact Michael Schuit on (xxxxxxxx) or (xxxx xxx xxx).

Yours Faithfully

Michael Schuit

Human Resources Business Partner

GM Holden Ltd”

(Note: telephone numbers deleted.)

[19] For the sake of completeness, I note that subsequent negotiations between the AMWU and GMH did not agree on the reinstatement sought by the AMWU.

The evidence

[20] I was provided with a substantial amount of written and oral evidence, all of which I have taken into account.

[21] Mr Orsborn’s evidence went to his work and injury history at GMH. He explained his understanding of the GMH rehabilitation process and the extent to which GMH remained supportive of his rehabilitation in terms of the provision of suitable alternative work.

[22] Mr Orsborn advised that he took on the Pizzeria job, which was consistent with his injury limitations, in order to supplement his income consequent upon the reduction of working hours at GMH. This second job did not impact on his ability to undertake his primary work at GMH.

[23] Mr Orsborn’s evidence was that he further hurt his back at work on 25 February 2010 and this further injury was not reviewed by a GMH doctor until 10 March 2010. On 3 March 2010 Mr Orsborn asserts he aggravated the 25 February 2010 injury while undertaking sweeping work. He was able to undertake his Pizzeria job that afternoon but was in too much pain to work at GMH on 4 March 2010. He attended his doctor that afternoon and acted on his doctor's advice that he not work at GMH for a week.

[24] Mr Orsborn explained the information he provided to Dr Chang on 4 March 2010 and his subsequent actions in informing GMH of his inability to work and claiming worker’s compensation for the week commencing 4 March 2010 consistent with the PMC.

[25] Mr Orsborn explained that in continuing his Pizzeria work he did not intend to defraud GMH but legitimately took time off work on worker’s compensation from GMH from 4 March 2010.

[26] Dr Chang provided a prepared report 1. The evidence of Dr Chang was that Mr Orsborn had been his patient since 1998 and that, as such, he had treated Mr Orsborn for various worker’s compensation injuries. Dr Chang explained the consultation process for the relatively short consultation on 4 March 2010, at the conclusion of which he issued the PMC.

[27] Dr Chang confirmed that, at the time he issued the PMC, he was unaware that Mr Orsborn had a second job at the Pizzeria. However, he had subsequently been appraised of that position and now considered that the Pizzeria work equated with the function of collecting a pizza for private consumption and hence was not inconsistent with the PMC.

[28] Dr Chang advised that he had issued the PMC on 4 March 2010 on the basis that he was aware of Mr Orsborn’s permanent restrictions and thought it best that he not work at GMH for the next week.

[29] I note that Dr Chang’s evidence with respect to the 4 March 2010 consultation was understandably restricted by the time which has passed since that consultation.

[30] Mr Gee is the Vehicle Division Regional Secretary for the South Australian Branch of the AMWU. His responsibilities extend to the representation of members employed by GMH.

[31] Mr Gee’s evidence went to his recollection that in early May 2010 senior shop steward Ms Orbanic contacted him by telephone and advised him of allegations that GMH management were putting to Mr Orsborn. Mr Gee recalls telling Ms Orbanic that Mr Orsborn should be encouraged to meet with the AMWU’s preferred lawyers as soon as possible and that he should not respond to the GMH questions until he had sought legal advice.

[32] Subsequent to the termination of Mr Orsborn’s employment, Mr Gee met with GMH management in an endeavour to have Mr Orsborn reinstated.

[33] Mr Gee’s evidence went to the reduced working arrangements implemented by GMH and to the effect these arrangements had on employees, including those on worker’s compensation. His evidence also went to his understanding of the vehicle leasing arrangements available to GMH employees.

[34] Mr Brown is a senior AMWU shop steward at GMH. His evidence went to his recollection of the meeting on 5 May 2010.

[35] Ms Orbanic was the initial senior AMWU shop steward who was asked by GMH management to represent Mr Orsborn in the meeting on 5 May 2010. Her evidence went to the conduct of this meeting, her telephone discussion with Mr Gee and her subsequent advice to Mr Orsborn.

[36] Mr Schuit, the GMH Human Resources Business Partner gave evidence about his awareness of the GMH concerns over the extent to which Mr Orsborn had asserted that he was unable to work for GMH but had then continued to undertake different employment.

[37] Mr Schuit’s evidence went to his preparation for, and conduct of, the meeting on 5 May 2010.

[38] Mr Stewart is a Material Flow Manager with GMH. He had general managerial responsibility for Mr Orsborn as at 5 May 2010. His evidence went to the application of the GMH work injury management policies with respect to Mr Orsborn. Mr Stewart also explained that, at some time after Mr Orsborn’s absence from work from 4 to 12 March 2010 he was made aware that Mr Orsborn may have been working elsewhere and he had subsequently appraised the GMH worker’s compensation personnel of this information.

[39] Mr Stewart's evidence also went to his preparation for, and recollection of, the meeting on 5 May 2010.

[40] Mr Rodis is a Material Flow Area Leader with GMH and as such had overall line management responsibility for Mr Orsborn in March 2010. His evidence went to his understanding and recollection of the application of the GMH work injury management policies with respect to Mr Orsborn.

[41] Additionally, Mr Rodis’ evidence went to discussions which he had with Mr Orsborn on 3 March 2010 which resulted in Mr Orsborn being transferred to a different area for the provision of restricted duties work.

[42] Ms Sellers was, at the time of the termination of Mr Orsborn’s employment, a worker’s compensation claims officer engaged by GMH. Her evidence went to her receipt of Mr Orsborn’s worker’s compensation claim form and PMC on 11 March 2010. Ms Sellers also gave evidence relative to worker’s compensation top-up payments made to Mr Orsborn and to a worker’s compensation claim form completed by him in that respect.

[43] Ms Sellers advised that when she was informed by Mr Stewart that Mr Orsborn may have been working elsewhere during his absence from 4 to 12 March 2010, she initiated investigations which included covert surveillance and ultimately informed Mr Schuit of the outcome of that investigation.

[44] In the course of the evidence given by Mr Stewart, an issue arose relative to what information was provided to Mr Orsborn in the 5 May 2010 meeting. Mr Stewart's initial advice was to the effect that the WorkCover claim form signed by Mr Orsborn on 10 March 2010 was provided to Mr Orsborn in the meeting on 5 May 2010. This advice appears inconsistent with the evidence of Mr Schuit, Ms Orbanic, Mr Brown and Mr Orsborn. I refused Ms Nachiappan’s request to recall other witnesses on this basis and have concluded that Mr Stewart was, in this respect, mistaken.

The Submissions

[45] Mr Orsborn’s position was that the termination of his employment was substantively and procedurally unfair.

[46] Mr Orsborn asserts that his continuing work at the Pizzeria did not harm his back and was consistent with the PMC such that his behaviour did not represent serious or wilful misconduct.

[47] Mr Orsborn asserts that he did not intentionally deceive GMH. He does not recall completing the WorkCover form such that he denied the second Pizzeria position but, he advises that if he did so it was because he was rushed in the completion of the form by the requirement that he see the GMH doctor. In any event, he argues that his conduct in continuing to work at the Pizzeria while not working at GMH did not represent a valid reason for the termination of his employment.

[48] To the extent that GMH took into account Mr Orsborn’s use of his GMH lease vehicle in the performance of his Pizzeria work, in the decision to terminate his employment, Mr Orsborn argues that this was unfair, did not represent a valid reason for the termination of employment and was inconsistent with the normal GMH approach to such matters.

[49] Finally, Mr Orsborn asserts that the termination of his employment was procedurally unfair in that he was not given advance notice of the purpose of the meeting on 5 May 2010 and was not given a sufficient opportunity to access legal advice relating to the allegations raised with him.

[50] The GMH position is that Mr Orsborn’s employment was terminated on the basis that he advised GMH that he was unfit for work, claimed worker’s compensation payments and then proceeded to undertake work at the Pizzeria.

[51] GMH does not rely on the allegations relative to Mr Orsborn’s unauthorised use of his lease vehicle as the basis for the termination of employment.

[52] GMH asserts that Mr Orsborn’s conduct was deceptive and destructive of the necessary trust so as to provide a valid reason for the termination of his employment.

[53] GMH asserts that the extensive discussions on 5 May 2010 which resulted in the termination of Mr Orsborn’s employment ensured that Mr Orsborn was represented and reflected a procedurally fair approach.

Findings

[54] Before considering the extent to which the termination of Mr Orsborn’s employment was substantively and procedurally fair, it is appropriate that I outline conclusions relative to a number of issues about which the parties are in dispute.

[55] On 26 October 2009 Mr Orsborn signed a WorkCover Work Report Form. He did not complete that part of the form which required disclosure of any second employment. I have concluded that this did not reflect an intention to deceive GMH. I am satisfied that in completing this form Mr Orsborn was pursuing payment of top-up worker’s compensation payments which he had been advised were due to him given his long-standing worker’s compensation history. The effect of these top-up payments was to increase the payments made to Mr Orsborn for the ‘down’ week when he was not required to work.

[56] However, on 10 March 2010 Mr Orsborn completed a WorkCover Form which was a Notice of Work Related Injury. This related to the 25 February injury and the time off work from GMH which commenced on 4 March 2010. I have concluded that Mr Orsborn confirmed in this form that he had no other current employers and that he did so deliberately.

[57] When Mr Orsborn saw his doctor on 4 March 2010 I have concluded that he elected not to advise Dr Chang of his second, Pizzeria job. This may have been because he did not consider his second job to be relevant, but nevertheless it reflected a decision not to advise the doctor.

[58] When Mr Orsborn was called to the meeting with GMH management on 5 May 2010 I have concluded that he was given the opportunity to be represented and was content for Ms Orbanic to undertake that task. Further, Mr Orsborn did not object to the later involvement of Mr Brown on his behalf.

[59] I have concluded that the primary allegation put to Mr Orsborn by GMH management at this meeting was that he had provided advice and a PMC indicating that he was unfit to work but had undertaken work at the Pizzeria during that period. Further, during this meeting Mr Orsborn was provided with a copy of the surveillance DVD and the PMC of 4 March 2010. Finally, in this respect I have concluded that Mr Orsborn did not dispute that he worked at the Pizzeria during the period in question.

[60] I have concluded that Dr Chang’s report 2, in so far as it relates to the 25 February 2010 injury, the consultation on 4 March 2010 and Mr Orsborn’s subsequent work at the Pizzeria, is founded, at least in part, on responses to information provided in correspondence sent to the doctor by Mr Orsborn’s lawyers. This correspondence detailed an assessment of the work arrangements applicable to Mr Orsborn at GMH and at the Pizzeria.

Section 396

[61] Section 396 lists four initial matters which must be determined before the merits of the application are considered.

[62] I am satisfied that the application was made within the prescribed time and that Mr Orsborn is a person who is protected from unfair dismissal by the Act. GMH is not a small business such that the Small Business Fair Dismissal Code can have application. Finally, the termination of Mr Orsborn’s employment did not arise from a redundancy.

Section 387

[63] Section 387 sets out the criteria which must be considered. This section states:

“387 Criteria for considering harshness etc.

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, FWA must take into account:

(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 FWA considers relevant.”

[64] In considering these factors I have taken all of the evidence before me into account and have considered the authorities to which I have been referred together with other decisions.

Valid Reason

[65] I have concluded that GMH dismissed Mr Orsborn because he misrepresented to GMH the extent of his ability to undertake work, and made a worker’s compensation claim for total incapacity for this time, but in fact, variously worked at the Pizzeria over this same period of time.

[66] I do not consider that Mr Orsborn’s use of his GMH lease vehicle represented any substantial reason or contribution to the termination of employment decision. In this respect I have relied on the evidence of Mr Schuit and Mr Stewart. Mr Schuit’s evidence relative to the meeting on 5 May 2010, is particularly relevant:

“40. I had an opportunity then to have a discussion with Mr Stewart about the matters that had been raised in the meeting to that point and while we were having the break I recall that Paul Brown came up to me and sought to point out to me that the times of work undertaken by Mr Orsborn were at times of the day outside of the usual rostered hours of work at GM Holden Limited. I said to Mr Brown that I was aware of that fact but what concerned us was that Mr Orsborn had not made himself available for work at any time during the period of the certification that he was unfit for work and had deprived us of the opportunity of having some productivity from Mr Orsborn during that period and I also pointed out that, at the same time, Mr Orsborn had been claiming workers compensation payments.

....

47. I then invited either Mr Orsborn, Mrs Orbanic or Mr Brown to make any further comments they may wish. No further comment was made. We then had a brief break where I spoke with Mr Stewart and we discussed the responses that we had received. We both formed the view that Mr Orsborn had engaged in serious and wilful misconduct. We were both satisfied that Mr Orsborn had the ability to work at GM Holden Limited during that period. He claimed workers compensation weekly payment on days modified duties could have been made available to reduce the liability we considered that Mr Orsborn had deliberately deceived us by providing a medical certificate saying that he was unfit for work, than working elsewhere and not making himself available for work with us. We noted that Mr Orsborn had been well experienced in relation to the workers compensation system having had work related injury dating back to 1997 and we considered that he well knew the difference between a certificate indicating a fitness for modified work and a certificate indicating unfitness for work.

48. I did not believe the explanation given by Mr Orsborn that he understood the certificate by Dr Chang to mean that he was only unfit for work at Holden. I had reached a point where I did not trust what I was being told by Mr Orsborn. In the circumstances I could not see how he could have a continuing working relationship, built upon trust with Holden. Although the lease breach was considered it was not the main reason for the decision to terminate the employment contract. 3 (sic)

[67] I have adopted the concept of a valid reason espoused by North J in Selvechandron v Petersen Plastics 4 (Selvechandron)in the following terms:

“In its context in s.170DE(1), the adjective “valid” should be given the meaning of sound, defensible or well founded. 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 reasons 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 treated fairly”.

[68] Further, whilst I have noted that section 387(a) of the Act is expressed differently to its predecessor provisions, I consider that the position adopted by Moore J in Edwards v Giudice and Others 5, remains appropriate:

“[6] .... The paragraph requires consideration of the validity of the reason when the reason is, relevantly, based on conduct of the employee. It is, in my opinion, difficult to avoid the conclusion that the Commission is obliged in such circumstances to investigate in the inquiry process contemplated by s.170CG(3) whether the conduct relied on occurred as a necessary step in the process of determining whether a valid reason existed.

[7] The reason would be valid because the conduct occurred and justified termination. The reason might not be valid because the conduct did not occur or it did occur but did not justify termination. An employee may concede in an arbitration that the conduct took place because, for example, it involved a trivial misdemeanour. In those circumstances the employee might elect to contest the termination in the arbitration on the basis that the conduct took place but the conduct did not provide a valid reason and perhaps also by relying on the other grounds in paras (b) to (e). However an employee may not concede or admit, for the purposes of the arbitration, that the conduct occurred or may not be prepared to accept that the Commission could assume the conduct occurred. In either situation the employee would be putting in issue whether the conduct occurred. In my opinion the Commission must, in these circumstances, determine whether the conduct occurred as a step in resolving whether there was a valid reason. ...."

[69] Accordingly I have considered the conduct that occurred and how it should be characterised.

[70] Mr Orsborn chose not to advise his doctor of his Pizzeria job. Dr Chang’s certificate specified that Mr Orsborn was unfit to work. Dr Chang’s evidence was that, in retrospect, the Pizzeria work was within the range of functions Mr Orsborn could undertake. Mr Orsborn relied on this PMC to confirm his assertion to GMH that he was unable to work. When he completed the WorkCover Notice of Injury Form Mr Orsborn did not simply leave the second employment disclosure blank, he advised that he did not have a second job.

[71] His actions in this respect were not honest as a matter of fact: he did have a second job and he was able to work and he did so at the Pizzeria. Mr Orsborn consequently obtained worker’s compensation payments for the week away from GMH on the basis of an assertion that he was unable to work. His own actions deprived GMH of the capacity to offer him further modified duties.

[72] There can be no doubt that Mr Orsborn was aware of GMH’s commitment to identifying alternative duties. His evidence was that he was well aware of this commitment.

[73] Mr Orsborn relied on the PMC to support his assertion that he could not work. That PMC was itself obtained in these circumstances where Mr Orsborn elected not to advise Dr Chang of his second job.

[74] It is possible that there would have been no adverse consequence to Mr Orsborn from advising both Dr Chang and GMH of his second job, but his actions in not doing so were, by definition, inherently dishonest.

[75] I consider that Mr Orsborn’s conduct represented serious misconduct pursuant to the definition set out in Regulation 1.07. However, the requirement in section 387(a) goes to the extent to which that behaviour represented a valid reason for the termination of his employment.

[76] Mr Orsborn’s situation has some inherent similarities to those considered by a Full Bench of the Australian Industrial Relations Commission in Osman and Toyota Motor Corporation Australia Ltd 6. It is not necessary that I recite those similarities but the following observation is particularly relevant:

“[62] The final point advanced was that the Commissioner had erred in "failing to take the view that an isolated act of inadvertence in relation to completion of a form, with no substantial consequences for the employer, as occurred in the present case could not amount to a valid reason for dismissal". The appellant's written submissions expands on this point in the following terms:

"(i) The common law requires, as stated by Lord Evershed MR at 288A in Laws v London Chronicle Indicator Newspapers) Ltd [1959] 2 All ER 285, 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 "willful;" it does (in other words) connote a deliberate flouting of the essential contractual conditions." See also North v TV Corp 11 ALR 599 per Smithers & Evatt JJ at 609 and Adami v Maison de Luxe Ltd 35 CLR 143 per Isaacs ACJ at 152.

(ii) The Workplace Relations Act 1996 at s170CM(1)(c) refers to the term "serious misconduct" and s170CM(7) provides that the regulations may give examples of serious misconduct. Regulation 30CA does give such examples and defines serious misconduct extensively in a manner which coincides with the common law's definition importantly requiring willful or deliberate conduct, not mere inadvertence (except if a significant danger to safety is caused), which is inconsistent with the continuance of the employment. See Kenelly v Incitec Ltd [1998] 1470 FCA (29 October 1998) (unreported) per Spender J at p11 and cases cited therein."32

[63] Two points may be made about the appellant's contentions on this point. The first is that the argument is based on the premise that we are dealing with "an isolated act of inadvertence". This proposition was rejected by the Commissioner at first instance and we have concluded that the Commissioner's decision in this regard did not disclose any error warranting correction on appeal.

[64] The second point which may be made in respect of the appellant's contention goes to the relevance of the common law requirements relating to conduct justifying summary dismissal to the assessment of whether there was a valid reason for termination within the meaning of s.170CG(3)(a). This matter was the subject of some discussion in Annetta v Ansett Australia Ltd33. In this case the Full Bench said, at paragraphs 9 and 10 of the decision:

"[9] It was submitted on behalf of the appellant that in cases of summary dismissal there can be no valid reason for the termination within the terms of s.170CG(3)(a) unless the employee is guilty of conduct justifying summary dismissal at common law. In this respect it was further submitted that the common law requirement goes beyond wilful disobedience in that the conduct must amount to a refusal to be bound by the terms of the contract: Adami v Maison de Luxe Limited (1924) 35 CLR 143. Mr Langmead submitted that the appellant's conduct on 17 February, 1998 could not be so regarded because there was no instruction given to the appellant, only a request, and the appellant provided an adequate explanation for not doing the work he was asked to do.

[10] We think there are a number of answers to this submission. It is generally accepted that the term "valid reason" should be construed to mean "sound, defensible or well-founded": Selvachandran v Peterson Plastics Pty Ltd (1995) 62 IR 371 at 373. Although that case concerned legislation which has now been repealed it is still regarded as authoritative. To limit the meaning of the term "valid reason" by importing a test amounting to repudiation of the contract at common law is unwarranted and impermissible. Secondly 170CG(3)(a) focuses on the reason for termination. The appellant's construction would result in an arbitrary application of the section in some circumstances. Take a case where an employee is guilty of conduct which does not amount to misconduct justifying summary termination. If the employer terminates the employment on notice there would be a valid reason for doing so. If the employer terminates the employment summarily there would not be a valid reason for doing so. The validity of the reason cannot be made to depend on whether or not the termination was on notice. Thirdly, however, we are not convinced that if the common law test were applied it would make any difference in this case. The Senior Deputy President found that the appellant had refused to do the duties he was requested to do and that the explanation he gave for the refusals was unreasonable. We think these findings were clearly open to her. The appellant did not say during the enquiry into his conduct that he was not given a direction. Furthermore he continued to maintain his right to refuse to do work which was not his and to refuse to rectify work which somebody else had performed unsatisfactorily. The appellant took this position in an interview more than a week after the day of the refusals. This amounts to the unilateral inclusion of a new term in the employment contract and by necessity amounts to a refusal to observe the fundamental requirement of any contract of service - to be ready, willing and available to carry out the lawful directions of the employer. In the circumstances we reject the submission that the Senior Deputy President should have found that there was no valid reason for the termination of the appellant's employment."”

[77] In this context I have considered whether Mr Orsborn’s dishonest conduct in asserting to GMH that he could not work, advising that he had no second job, and then working at the Pizzeria was such that it represented a valid reason for the termination of his employment. On the evidence before me, Mr Orsborn was clearly aware of GMH’s commitment to providing restricted work duties. He chose not to tell Dr Chang of his second job. He chose to mislead GMH when he lodged his worker’s compensation claim form. In the context of his assertion to GMH that he was unable to work, his decisions with respect to disclosure of the second job were significant. They mitigate in favour of a finding that there was a valid reason for the termination of his employment.

[78] However, not every dishonest act can be regarded as representing a valid reason for the termination of employment. A Full Bench of the Australian Industrial Relations Commission in Britax Rainsfords Pty Ltd v Jones 7 observed:

“55. Britax Rainsfords’ case was substantially predicated upon the proposition that Ms Jones’ failure to make a full disclosure of her employment and workers compensation claims history was a fundamental breach of duty. The level of fault attributed to Ms Jones by that proposition is of a similar kind and degree to that attributable to a proponent for a policy of insurance who fails to make full disclosure of details that go to the insurer’s assessment of insurable risk. For such, and for some similar purposes, the common law requires that the assured contracting party shows the utmost good faith. However, a contract of employment is not a contract of insurance. Nor could a contract of employment readily be admitted to the special class of contracts subject to such a duty.”

[79] I have considered the extent to which Mr Orsborn’s failure to disclose his second job may have been simply an omission or an oversight. However, the manner in which he completed the WorkCover claim form and the extent to which he went directly from Dr Chang’s rooms to his Pizzeria job are not consistent with an unintentional omission. At best, Mr Orsborn put himself in an opportunistic position. He obtained a PMC from Dr Chang and relied on that to support his advice to GMH that he was unable to work. He had substantial experience of the worker’s compensation system and his actions deprived the employer of the capacity to request that he undertake any work, which may have included work which was even inherently similar to that which he did at the Pizzeria. At that time, Mr Orsborn was in receipt of worker’s compensation top-up payments from GMH which meant that he was receiving payments in excess of those being made to comparable employees who did not have worker’s compensation claims. His Pizzeria income applied in addition to those payments.

[80] I am satisfied that Mr Orsborn’s conduct severely damaged the trust which GMH could reasonably have had in him as an employee. GMH took action to investigate the matter shortly after it became aware of the potential for misconduct. It did not condone it, and there is no evidence that indicates that GMH condoned behaviour of a comparable nature.

[81] Mr Orsborn’s actions in asserting that he was unfit for work and then undertaking different work are quite distinct from situations where there is a dispute over the extent to which any individual employee's actions are consistent with medical restrictions or assertions. Had Mr Orsborn advised Dr Chang and GMH of his Pizzeria job and presented in a situation where the medical advice was such that he should not work at GMH but could undertake other work functions, there could be no doubt about the legitimacy of his position. However, this was not the case.

[82] On the basis of these considerations I have concluded that Mr Orsborn’s behaviour represented a valid reason for the termination of his employment. In the context of the Selvechandron test, there was an obligation for Mr Orsborn to be honest about his capacity to undertake any work for the time he claimed worker’s compensation and he failed to meet this serious duty or obligation.

Notification of the Reason

[83] The evidence of Mr Orsborn, Ms Orbanic and Mr Brown indicates that, in the course of the 5 May 2010 meeting, Mr Orsborn expressed confusion in that, had he known that his second job could result in the termination of his employment, he would not have taken that second job.

[84] I am satisfied that Mr Schuit advised Mr Orsborn that the GMH concern was that he did not attend for work, and claimed worker’s compensation on the basis that he was unfit to work, but then continued to work at the Pizzeria.

[85] I am satisfied that this was explained to Mr Orsborn as the reason for the termination of his employment and that Mr Orsborn’s comments at the 5 May 2010 meeting did not reflect the clear information provided to him.

[86] GMH provided Mr Orsborn with written advice of the termination of his employment at the conclusion of the 5 May 2010 meeting. I am satisfied that this advice was prepared only shortly before the meeting concluded and that it reflected the allegations that had been put to Mr Orsborn.

Opportunity to Respond

[87] Mr Orsborn was asked to attend the 5 May 2010 meeting without any advance warning of the nature of the allegations to be put to him.

[88] I have noted that his responses to at least some of the questions put to him by GMH management reflected the advice which had presumably been relayed to him by his senior shop steward, Ms Orbanic, to the effect that he should decline to answer questions until he had received legal advice. I have also noted that, in the course of this meeting, Mr Orsborn provided answers to certain questions such that there could be no doubt that he worked at the Pizzeria at various times during his worker’s compensation absence from GMH.

[89] I consider that the GMH approach lacked the degree of courtesy which could have been expected from such a specialist human resource management function in that, had Mr Orsborn been given advance notice of the employer concerns, or an extended opportunity to respond, he could have accessed more extensive advice and possibly representation.

[90] However, the GMH allegations were put to him and his responses confirmed that critical concern such that he had asserted to GMH that he was unfit for work whilst he was, as a matter of fact, undertaking work at the Pizzeria.

Support Person

[91] GMH went to some lengths to ensure that Mr Orsborn had access to an AMWU support person. I am satisfied that GMH asked Ms Orbanic to attend the meeting from the outset and then facilitated the later attendance of Mr Brown.

[92] I am unable to conclude that either, Mr Orsborn, Ms Orbanic or Mr Brown formally requested a substantial adjournment of the 5 May 2010 meeting in order to enable Mr Orsborn to access professional legal advice.

[93] Consequently, in terms of the specific issue addressed in section 387(d), I am satisfied that GMH did not unreasonably refuse to allow Mr Orsborn to have a support person present.

[94] I have further reviewed the conduct of the 5 May 2010 meeting later in this decision.

Unsatisfactory Performance

[95] There is no indication that the termination of Mr Orsborn’s employment related to unsatisfactory performance relative to issues about which he had been previously warned.

Size of GMH

[96] GMH is a very large employer. I do not consider that any revision of the employment termination practices is appropriate on the basis of the employer's size.

Absence of dedicated Human Resource Management expertise

[97] GMH human resource management personnel were integrally involved with the process which led to the termination of Mr Orsborn’s employment.

Any other matters considered relevant

[98] I am satisfied that the minimum requirements, with respect to the opportunity to respond and access a support person, were met by GMH. However, advance notice of the allegations and/or an opportunity to access legal advice would have meant that the GMH process was less open to any criticism that the 5 May 2010 meeting occurred with undue haste.

[99] I have considered Mr Orsborn’s personal situation. He has a long term back injury and a long history of employment with GMH. He is 46 years old. Whilst there is limited evidence relative to Mr Orsborn’s current employment situation, I have concluded that he is not currently employed on a full-time basis. I have noted Mr Orsborn’s evidence that his worker’s compensation payments have been terminated but am not aware of whether this action has been disputed.

[100] I have also considered the GMH position that it self insures under the South Australian Worker’s Compensation system and makes substantial efforts to avoid WorkCover claims and minimise their adverse effect on both employees and its business operations.

[101] Other issues of relevance will be addressed in my consideration of whether, on balance, the termination of Mr Orsborn’s employment was harsh, unjust or unreasonable.

Conclusion- Harsh, Unjust or Unreasonable

[102] I have considered the High Court decision in Byrne and Frew v Australian Airlines Pty Ltd, and in particular the observations made by McHugh and Gummow JJ:

“It may be that the termination is harsh but not unreasonable, unjust but not harsh or unreasonable, or unreasonable but not harsh or unjust. In many cases the concepts will overlap. Thus, the one termination of employment may be unjust because the employee was not guilty of the misconduct on which the employer acted, may be unreasonable because it was decided upon inferences which could not reasonably have been drawn from the material before the employer, and may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted.”

[103] I am satisfied that the termination of Mr Orsborn cannot be described as unjust. Mr Orsborn’s behaviour represented serious misconduct and it went to the heart of the trust necessary to maintain the employment relationship.

[104] However, there was an element of unreasonableness associated with the process in that Mr Orsborn was not given advance notice of the allegations, nor access to legal representation in the context that his union said that he should access such advice.

[105] On balance however, I am unable to describe the termination of employment as unreasonable in that there was sufficient information available to GMH to confirm the critical fact that Mr Orsborn was working for another employer over the time he asserted that he was unfit to work.

[106] The issue of whether the termination of Mr Orsborn’s employment was harsh in its consequences is more difficult to determine. There is limited information before me in this respect.

[107] I do not consider that the concept of harshness can be regarded simply from an employee perspective. Were that to be the case, almost every dismissal would be assessed as harsh.

[108] It follows that there are two dimensions to the concept of harshness. The first is that it should be considered from both the employer and employee perspectives. Secondly, it incorporates the concept of proportionality relative to the employee’s conduct.

[109] Seen in this context, Mr Orsborn’s actions deprived GMH of the potential to offer any form of restricted duties to him over the week he claimed worker’s compensation and breached a fundamental tenet of the employment and worker’s compensation system involving the provision of honest information.

[110] I have concluded that the effect of the termination of employment on Mr Orsborn is clearly substantial, notwithstanding that limited information relative to the status of his WorkCover position has been provided to me. Additionally, I have concluded that Mr Orsborn is likely to have increased difficulty in obtaining employment comparable with that which he had at GMH.

[111] Notwithstanding these considerations, I have concluded that, on the material before me, the termination of Mr Orsborn’s employment cannot be regarded as harsh. Mr Orsborn’s actions were so inappropriate such that the termination of employment by GMH was a sustainable and fair conclusion.

[112] For the reasons set out above I have concluded that the termination of Mr Orsborn’s employment was neither harsh, unjust nor unreasonable.

[113] Accordingly, an Order [PR502284] will be issued dismissing the application effective from today.

Appearances:

S Nachiappan counsel for Mr Orsborn.

S Cole counsel for GM Holden Limited.

Hearing details:

2010.

Adelaide:

September 8 and 9.

 1   Exhibit O6

 2   Exhibit O6

 3   Exhibit G4

 4 (1995) 62 IR 371 at 373

 5 (1999) 169 ALR 89

 6   PR910409

 7  PR908112

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