Arne McDonald v TNT Australia Pty Ltd T/A TNT Express

[2014] FWC 4246

[2014] FWC 4246

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Arne McDonald
v
TNT Australia Pty Ltd T/A TNT Express
(U2014/5079)

SENIOR DEPUTY PRESIDENT O’CALLAGHAN ADELAIDE, 7 JULY 2014

Application for unfair dismissal remedy - no valid reason for dismissal - reinstatement - order for lost remuneration.

[1] On 28 February 2014 Mr McDonald lodged an application pursuant to s.394 of the Fair Work Act 2009 (the FW Act), through which he sought relief with respect to the termination of his employment with TNT Australia Pty Ltd T/A TNT Express (TNT). The application was not settled through the conciliation process and was referred to me for determination on 17 April 2014. It was the subject of a hearing on 17 June 2014.

[2] At this hearing Mr McDonald was represented by Mr Lawrie of the Transport Workers Union and TNT was represented by its Employee Relations Manager, Mr Moulton. The facts of this matter involve persons and a business who are not parties to the matter and whom I have decided not to identify. The parties to this matter have been advised of the identifying references used in this decision.

[3] There is minimal dispute over the background facts associated with this application. Mr McDonald worked for TNT as a pickup and delivery driver for approximately 9 1/2 years. He had been given a number of warnings over the duration of his employment. In 2006, he was warned in relation to locking his truck. In 2009 he was given written advice relative to his attendance and notification failures. In January 2011 he was given a warning for breaching the TNT no smoking policy. In September 2013 he received a warning relative to the TNT no smoking policy. Mr McDonald was also given a final written warning on 10 January 2014 as a result of his failure to secure the back door of his truck on 27 November 2013.

[4] The termination of Mr McDonald’s employment took effect on 17 February 2014 and was confirmed in written advice to him on 20 February 2014. This advice confirmed that TNT considered that Mr McDonald’s behaviour whilst delivering parcels to a shopping centre on 30 December 2013 was grossly unacceptable and constituted a breach of TNT’s Workplace Harassment and Discrimination Policy. TNT confirmed its conclusion that Mr McDonald’s actions could also be unlawful and could potentially expose both Mr McDonald and TNT to significant financial penalties. TNT paid Mr McDonald five weeks pay in lieu of notice.

[5] There is some dispute about the events of 30 December 2013. Mr McDonald delivered parcels to a retail store, which I have referred to as the ‘Shop’. He was shown into a storeroom where a Shop employee, Ms X was present. Ms X’s first name is Bree. Whilst performing his parcel delivery functions Mr McDonald had an exchange with Ms X. There is some disagreement over the exact duration and nature of this exchange and particularly comments which centred on Ms X’s first name. Soon after Mr McDonald left the store Ms X expressed her concern about the discussion to her manager, Ms Y. Ms Y made a formal complaint to TNT shortly after on that same day.

[6] On 2 January 2014 Mr McDonald was stood down pending an investigation. This investigation involved an interview with Ms X and her manager and an interview with Mr McDonald and his union representative on 7 January 2014. On 24 January 2014 TNT issued Mr McDonald with formal advice that it was proposing to terminate his employment as a consequence of this incident and his prior conduct. A meeting to give Mr McDonald an opportunity to respond was convened on 27 January 2014.

[7] Mr McDonald commenced a period of prearranged annual leave on 29 January 2014. On his return to work on 17 February 2014 TNT advised him that he was dismissed.

The Evidence

[8] Mr McDonald gave evidence about his employment history and the events which led to his dismissal. His evidence particularly went to the nature of the conversation he had with Ms X on 30 December 2013. His evidence extended to the efforts he had made to mitigate his losses since the termination of his employment.

[9] Mr Shirokih formerly worked with Mr McDonald. His evidence went to support Mr McDonald and the circumstances under which he worked. Mr Shirokih’s evidence went to his experience of incidents with other TNT staff which he asserted were inconsistent with the action taken to terminate Mr McDonald’s employment. Whilst I do not doubt Mr Shirokih’s evidence, it does not significantly assist in clarifying either the facts of the matter or the findings I am required to make. Mr Shirokih’s evidence does not enable me to draw conclusions about the contemporary treatment of employees in situations comparable to those of Mr McDonald.

[10] Ms X’s evidence went to her recollections of the events of 30 December 2013, the extent to which the incident with Mr McDonald distressed her, and the actions she subsequently took.

[11] Ms Y is Ms X’s manager. Her evidence went to the concerns raised with her by Ms X, her assessment of Ms X’s demeanour after the incident in the storeroom and the actions she then took to raise the matter with TNT.

[12] Mr Goudman is the TNT State Security Manager. His evidence went to his investigation of the matter, including the various interviews he conducted and his subsequent recommendations for action to be taken against Mr McDonald.

[13] Mr Stanton is the TNT Service Centre Manager for the Adelaide area. His evidence went to his consideration of the 30 December 2013 incident and his consideration of Mr McDonald’s disciplinary history. Mr Stanton’s evidence then went to detail the basis for his decision to terminate Mr McDonald’s employment and the actions he took to put that termination of employment into effect.

[14] I have no reason to doubt the integrity of any of the witnesses in this matter. To the extent that the evidence before me differed, these differences are not fundamental and reflect differing perspectives on the events which occurred.

Findings

[15] There are no issues of a jurisdictional or initial nature in this matter. Consequently, the application turns on findings of fairness. Before considering those issues I have made a number of findings on the evidence before me.

[16] Firstly, I have noted that the 30 December 2013 incident occurred after the 27 November 2013 incident where Mr McDonald omitted to close the back door of his truck but before the investigation of that particular matter had concluded. The 27 November 2013 incident resulted in Mr McDonald being given a first and final written warning on 10 January 2014.

[17] I have noted that, in the course of the investigation into the 27 November 2013 incident Mr McDonald disputed the efficiency of the TNT Truck security requirements. I am not satisfied that he refused to comply with those requirements in the future and consider that a substantial element of his concern in this respect reflected his suggestion for an alternative approach to vehicle security issues.

[18] I have concluded that Mr McDonald was generally aware of the TNT workplace harassment and discrimination policy and the obligation on him not to make inappropriate comments. I have noted the limited evidence before me with respect to other incidents involving TNT personnel but I am unable to conclude that these demonstrate either a common inappropriate approach to compliance with harassment policies or management disregard for those policies. The information before me simply does not enable a comparison of Mr McDonald’s situation arising from the 30 December 2013 incident with other circumstances.

[19] Whilst I have noted the warnings given to Mr McDonald prior to the incident on 30 December 2013, I am not satisfied that, as of that date, Mr McDonald was operating under a clear understanding that any further misconduct could give rise to the termination of his employment.

[20] In terms of the incident on 30 December 2013 I have concluded that when Ms Y showed Mr McDonald into the Shop storeroom so that he could make his deliveries he observed Ms X at the end of that storeroom. I have concluded that the storeroom was a relatively small and narrow room with a single door at the end and that Ms X was at the other end of the room. She was initially engaged with her mobile phone and was on her lunch break.

[21] I have concluded that Ms X and Mr McDonald engaged in a brief conversation. Whilst Ms X did not recall that initial discussion her evidence confirmed that she had recently moved house and had had a quiet Christmas. In the investigation interview with Mr Goudman on 7 January 2014 1 Mr McDonald asserted that he had discussed these issues with Ms X and I have concluded that there is simply no other explanation for his knowledge of those issues.

[22] When Mr McDonald had finished delivering his parcels I have concluded that the storeroom was crowded and that there was only a very narrow corridor to allow access and egress from the room. Ms X asked Mr McDonald to remove some empty cartons and he did that.

[23] I have concluded that, in accordance with normal practices understood by Ms X, Mr McDonald gave her his scanner for her signature and asked her name, again in accordance with normal practices. Ms X said: “Its Bree”.

[24] There are some differences between Ms X’s version of the discussion from that point and Mr McDonald’s version. In reaching a conclusion about this matter I have noted that Ms X’s version changed from the advice she gave Mr Goudman on 6 January 2014 to the advice she provided in her witness statement. In her evidence to me Ms X confirmed that her assertions about the content of the discussion from that point on may not be exact. 2 I have also noted that Mr McDonald’s version of this discussion remained fundamentally consistent in the interview with Mr Goudman, his written advice in response to the TNT letter inviting him to explain why he should not be dismissed, and the evidence before me. I have concluded that Mr McDonald then asked Ms X: “How do you spell that?”. Ms X responded by saying: “You can spell it how you like”.

[25] Mr McDonald said something to the effect of “Hmm do you know there is a cheese called brie?” Ms X asserts that he said “Hmm, I could think of a few things I could do with that”. Mr McDonald disputes this and I have some difficulty integrating such a comment into the thread of the conversation, particularly as Ms X agrees that she said: “Yes I love bree”. I think it unlikely that Mr McDonald made that statement and more likely that he commented that there was a cheese called Brie but he could think of a few different ways of spelling that, before asking her how it was spelt. In this respect, I think it likely that Ms X misheard Mr McDonald.

[26] I think it likely that around this point in the conversation, Ms X said that she loved brie in terms of the reference to the cheese.

[27] Both Ms X and Mr McDonald agree that Mr McDonald concluded the conversation by saying “Oh gosh I better leave before it gets too dirty”.

[28] Ms X’s evidence was that she did not feel uncomfortable until Mr McDonald said “I could think of a few things I could do with that.” 3 Her evidence was that the whole conversation had sexual undertones and was unprofessional. She regarded Mr McDonald’s approach as “sleazy” and characteristic of an older man being dirty and inappropriate. Her evidence was that Mr McDonald’s question: “Did you know brie is a type of cheese?” made her feel uncomfortable because of his earlier comments.4 Finally, Ms X’s evidence was that she simply did not understand Mr McDonald’s statement to conclude the conversation.

[29] Ms X’s evidence is consistent with that of Mr McDonald in that he was not excessively close to her during this discussion. However, her evidence was that she did feel trapped because of the crowded storeroom.

[30] I have concluded that Ms X was most likely unnerved by what she understood Mr McDonald to have said and the manner in which it was said. I consider that it is likely that, at some point in that brief conversation Mr McDonald understood the conversation to have a sexual undertone and accordingly sought to conclude the conversation. However, I am unable to conclude that conversation, or the manner in which it occurred was overtly sexual or that it constituted harassment in any form. Mr McDonald’s means of concluding the discussion was, at best clumsy and inappropriate. I accept that his tone of voice may have made Ms X feel uncomfortable but she linked this feeling of discomfort with her understanding that he said he could think of a few things he could do with Brie cheese. Ms X’s earlier discussion with Mr McDonald about her Christmas and new accommodation indicate that Mr McDonald’s tone of voice did not consistently unnerve her. Accordingly, I consider that while Mr McDonald’s means of concluding the discussion can be regarded as a form of misconduct, the content of what he said otherwise and the manner in which it was said, did not represent misconduct or a breach of the TNT and Workplace Harassment & Discrimination Policy.

[31] I have concluded that Ms Y and Ms X acted quickly to alert TNT to their concerns about Mr McDonald. I have concluded that TNT then acted promptly to investigate the matter. The evidence of Mr Stanton was that TNT applied a range of responses to customer complaints about drivers, but the general approach was to arrange for the relevant driver to meet with the customer to clarify and resolve issues. 5 TNT did not apply that approach in this circumstance. I have concluded that this reflected the TNT conclusion that his behaviour warranted termination of employment.

[32] Section 387 states:

“Criteria for considering harshness etc.

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC 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 the FWC considers relevant.”

[33] I have considered each of these factors and the overall circumstances of this matter in reaching a conclusion.

Valid Reason

[34] Notwithstanding subsequent legislative changes, I have applied the approach adopted by Northrop J in Selvachandran v Peteron Plastics Pty Ltd 6 in reaching a conclusion about whether Mr McDonald’s behaviour represented a valid reason for the termination of his employment.

[35] I am satisfied that, in the meeting on 17 February 2014 where Mr McDonald was advised of the termination of his employment, and in the subsequent advice 7 of 20 February 2014 which confirmed this termination of employment, TNT advised that Mr McDonald’s comment “I’m stopping this before it gets too dirty” was a highly inappropriate way to conduct himself with a customer and breached the workplace harassment policy. I consider that particular comment was inappropriate, clumsy and unnecessary but I am unable to regard it as either a pattern of unwelcome behaviour or a single act of such a serious nature so as to fall within the concept of harassment addressed by the TNT workplace harassment and discrimination policy.

[36] I do not consider Mr McDonald’s behaviour on 30 December 2013 represented serious and wilful misconduct or behaviour which was of a magnitude that it provided a valid reason for the termination of his employment. In reaching this conclusion I have had particular regard to the inherent difficulty confronting service organisations such as TNT when dealing with customer complaints. In this situation, however, I am not satisfied that the TNT investigation established a valid reason for the termination of Mr McDonald’s employment as distinct from a situation which should have been addressed in concert with the customer.

[37] The termination of employment advice provided to Mr McDonald also noted that he had received a number of written warnings in relation to his conduct. 8 To the extent that this reference included consideration of the warning given to Mr McDonald on 10 January 2014, I consider that to be an unfair reference as that warning related to the 27 November 2013 incident which was, as at 30 December 2013, still the subject of investigation. Further, I do not consider that Mr McDonald’s responses to questions about future compliance with TNT security policies represented a valid basis for reviewing his employment. In terms of other warnings given to Mr McDonald, I have noted the warning given to him on 19 September 20139 with respect to a breach of the TNT No Smoking policy. This was not a final warning and I do not consider that Mr McDonald’s behaviour on 30 December 2013 was, even when considered in the context of this, and other warnings, of a nature which collectively represented a valid reason for the termination of his employment.

Notification of the reason

[38] Mr McDonald was notified of the reason for the termination of his employment at the meeting on 17 February 2014 and, subsequently, in the letter of 20 February 2014.

Opportunity to Respond

[39] Mr McDonald was given opportunities to respond to the proposition that his employment would be terminated and he utilised those opportunities. In these responses his advice to TNT about the 30 December 2013 incident was consistent.

Support Person

[40] TNT facilitated Mr McDonald’s access to a support person in the discussions where the matter was investigated and where Mr McDonald was advised of the termination of his employment.

Unsatisfactory Performance

[41] The termination of Mr McDonald’s employment did not reflect unsatisfactory performance. Notwithstanding that, I have taken the previous warnings given to him into account in reaching my conclusions about the fairness of the termination of his employment.

Size of the TNT business-impact on procedures.

[42] TNT is a very large organisation with sophisticated human resource management procedures.

Size of the TNT business-access to human resource management expertise.

[43] Again, TNT is a very large organisation and I am satisfied that it had access to human resource management expertise in determining to terminate the employment of Mr McDonald.

Other matters considered relevant

[44] As I have earlier indicated, I have had particular regard to the extent to which TNT is a service delivery organisation and to which the action taken to investigate and act on the complaint against Mr McDonald reflected its obvious desire to take appropriate action relative to that complaint. However, the TNT customer focus must be balanced against the dictate of fairness toits employees. In this respect I have not found a valid reason for the termination of Mr McDonald’s employment.

[45] I have noted the delay in implementing the termination of Mr McDonald’s employment which reflected a period of pre-planned annual leave on his part. I do not consider that to be a relevant factor in this particular matter.

Conclusion - Harsh, unjust and unreasonable

[46] I have concluded that the termination of Mr McDonald’s employment was harsh in that it was disproportionate to the extent of any misconduct. To the extent that the termination of employment was founded on earlier warnings, and in particular the 10 January 2014 warning, I have concluded that it was unjust. I have concluded that it was unreasonable in that this employment termination was the result of a customer concern which was not fully substantiated as misconduct. Consequently, pursuant to s.390 I consider that Mr McDonald was unfairly dismissed.

Remedy

[47] Given this finding, s.390 establishes the remedies available to the FWC. The primary remedy in this respect is that of reinstatement. Compensation can only be ordered in the event that the FWC is satisfied that reinstatement is inappropriate and that an order for payment of compensation is appropriate in all the circumstances. Mr McDonald seeks reinstatement. The TNT position was that, if a remedy was to be granted it should not involve reinstatement.

[48] In reaching a conclusion about the issue of reinstatement I have taken into account Mr McDonald’s significant period of employment with TNT and the size of the TNT business. I have noted that the warnings given to Mr McDonald over the duration of his employment were not generally related to his work performance but rather to his compliance with TNT policies and procedures. I have had particular regard to the 10 February 2014 warning given to Mr McDonald. This was a first and final written warning and placed Mr McDonald on notice about his future behaviour. I consider that Mr McDonald should have the opportunity to demonstrate to TNT that he is committed to complying with the prerequisites for continued employment. TNT is a significant employer and I am not satisfied that Mr McDonald is unable to be accommodated within the business in the event of reinstatement. I have also noted that Mr McDonald’s evidence was that he has unsuccessfully sought alternative employment inthetruck driving industry. Accordingly, I have taken it that he seeks to remain in this industry.

[49] I have noted the TNT position that the reinstatement of Mr McDonald would create difficulty in that its drivers are called upon to deliver to the full range of customers and his reinstatement could cause embarrassment with respect to the Shop where the 30 December 2013 incident occurred. I am unable to reconcile this concern with the advice that TNT generally go to some lengths to ensure that the concerns of its customers about particular drivers are resolved through face-to-face discussions.

[50] Having considered these issues, I have decided that Mr McDonald should be reinstated to TNT in the position which he held immediately prior to his dismissal. In this regard Mr McDonald should be well aware that a failure to follow TNT policies and instructions, and indeed the warnings given to him, is highly likely to result in the subsequent termination of his employment. In this respect I anticipate that the duration of Mr McDonald’s employment is likely to be completely dependent upon his own behaviour.

[51] Section 391(2) establishes that the FWC may, in these circumstances, order the continuity of Mr McDonald’s employment. Given my findings about the nature of the termination of his employment, I consider such an order to be appropriate in these circumstances.

[52] Section 391(3) provides that the FWC may make an order for the payment, to Mr McDonald, for remuneration lost, or likely to have been lost as a result of his dismissal. Again, given my findings about the nature of the termination of his employment, I consider that such an order is appropriate. That order will provide for the payment to Mr McDonald of remuneration for ordinary time from the date of the termination of his employment to the date of his reinstatement. The Order will provide that this amount should be reduced by the amount paid to Mr McDonald in lieu of notice and all income earned by him since the termination of his employment. Leave is reserved to the parties to seek assistance from the FWC in the determination of this amount in the event that the parties are unable to reach agreement on it.

Conclusion

[53] I have found the termination of Mr McDonald’s employment to be unfair and consider that he should be reinstated to the position which it previously held with the payment of lost remuneration less monies earned by him since that dismissal. An Order (PR552473) to this effect will be issued.

SENIOR DEPUTY PRESIDENT

Appearances:

E Lawrie representing the applicant.

A Moulton representing the respondent.

Hearing details:

2014.

Adelaide:

June 17.

 1   Exhibit T4, Attachment FG4.

 2   Sound recording, 1:24PM, 17 June 2014.

 3   Sound recording, 1:11:05PM, 17 June 2014.

 4   Sound recording, 1:15:22PM, 17 June 2014.

 5   Sound recording, 4:08:17PM, 17 June 2014.

 6 (1995) 62 IR 371.

 7   Exhibit T5, Attachment JS5.

 8   Exhibit T5, Attachment JS5.

 9   Exhibit T5, Attachment JS6.

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<Price code C, PR552453>