Atkins v North Australian Aboriginal Justice Agency Ltd
[2024] FCA 686
•27 June 2024
FEDERAL COURT OF AUSTRALIA
Atkins v North Australian Aboriginal Justice Agency Ltd [2024] FCA 686
File number: NTD 3 of 2023 Judgment of: CHARLESWORTH J Date of judgment: 27 June 2024 Catchwords: CORPORATIONS – employee alleging her employer (a company) purported to dismiss her from her employment – employee alleging the purported dismissal was not legally effective – whether a resolution of the Board of a company for the termination of the company’s Chief Executive Officer was made in compliance with the company’s Constitution – consequences of non-compliance – whether s 1322(2) of the Corporation Act 2001 (Cth) operated to cure a procedural irregularity – whether substantial injustice would result if the procedural irregularity were so cured
INDUSTRIAL LAW – alleged contraventions of s 340 of the Fair Work Act 2009 (Cth) – employee alleging her employer took five adverse actions because she exercised or threatened to exercise workplace rights – employer having the onus to prove that the adverse actions were not taken because the employee had exercised or proposed to exercise workplace rights – where members of a Board of directors gave evidence – whether the evidence was sufficient to prove that persons other than the witnesses materially participated or brought about the decisions – where some witness testimony about the reasons for the taking adverse actions could not be accepted in light of objective facts – relevance of temporal coincidence between employee’s exercise of workplace rights and employer’s adverse actions – whether the employer’s evidence established that some directors of a Board had not acted on a report the existence of which may have resulted from the acts or omissions of a person actuated by a prohibited reason – where presumption in s 361 of the Fair Work Act applied by reason of deficiencies in the case presented by the employer
Legislation: Australian Charities and Not-for-profits Commission Act 2012 (Cth)
Corporations Act 2001 (Cth) ss 1247B, 1322, 1382
Evidence Act 1995 (Cth) s 191
Fair Work Act 2009 (Cth) ss 340, 341, 342, 360, 361, 546, 793
Heydon JD, Cross on Evidence (14th ed, LexisNexis Australia, 2024)
Cases cited: Alam v National Australia Bank Ltd (2021) 288 FCR 301
Australian Red Cross Society v Queensland Nurses’ Union of Employees (2019) 273 FCR 332
Automatic Fire Sprinklers Pty Ltd v Watson (1946) 72 CLR 435
Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500
Browne v Dunn (1893) 6 R 67
Byrne v Australian Airlines Ltd (1995) 185 CLR 410
Carter v Federal Commissioner of Taxation (2020) 279 FCR 83
Central Innovation Pty Ltd v Garner (No 4) [2020] FCA 1796
Community Public Sector Union v Telstra Corporation Ltd (2001) 107 FCR 93
Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd (2014) 253 CLR 243
Construction, Forestry, Mining and Energy Union v Claremont Coal Pty Ltd (2015) 253 IR 166
Elliot v Kodak Australasia Pty Ltd (2001) 129 IR 251
Garner v Central Innovation Pty Limited [2022] FCAFC 64
Han v St Basil’s Homes (2023) 325 IPR 190
Integral Energy v Allen [2001] NSWIRComm 193; 107 IR 456
Jones v Dunkel (1959) 101 CLR 298
Klein v Metropolitan Fire and Emergency Services Board (2012) 208 FCR 178
Lamont v University of Queensland (No 2) [2020] FCA 720
Masterton Homes Pty Ltd v Palm Assets Pty Ltd [2009] NSWCA 234; 261 ALR 382
National Tertiary Education Union v Royal Melbourne Institute of Technology (2013) 234 IR 139
Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (1998) 195 CLR 1
Roberts v General Motors-Holden’s Employees’ Canteen Society Inc (1975) 25 FLR 415
RPS AAP Consulting Pty Ltd v Lamb [2023] FCA 1310
Short v Ambulance Victoria (2015) 249 IR 217
Squires v Flight Steward Association of Australia (1982) 2 IR 155
Street v Queensland Bar Association (1989) 168 CLR 461
Transport Workers’ Union of Australia v Qantas Airways Ltd (2021) 308 IR 244
Weinstock v Beck (2013) 251 CLR 396
Wong v National Australia Bank Limited (2022) 318 IR 148
Wong v National Australia Bank Limited [2021] FCA 671
Wood v City of Melbourne Corporation (1979) 26 ALR 430
Division: Fair Work Division Registry: Northern Territory National Practice Area: Employment and Industrial Relations Number of paragraphs: 789 Date of last submission: Applicant: 15 December 2023 Date of hearing: 23, 24, 25, 26, 30 October; 1 November; 11, 12 December 2023 Counsel for the Applicant: Mr M Harding SC with Ms R Kumar Solicitor for the Applicant: Nicole Dunn Lawyers Counsel for the Respondent: Ms R Sweet SC with Ms C Pase Solicitor for the Respondent: King & Wood Mallesons ORDERS
NTD 3 of 2023 BETWEEN: PRISCILLA ATKINS
Applicant
AND: NORTH AUSTRALIANABORIGINAL JUSTICE AGENCY LTD (ACN 118 017 842)
Respondent
ORDER MADE BY:
CHARLESWORTH J
DATE OF ORDER:
27 JUNE 2024
THE COURT ORDERS THAT:
1.There be a further case management hearing at 10.00am on 4 July 2024.
2.At or before 3.00pm on 3 July 2024, the applicant is to provide to the respondent and to the Court proposed minutes of order for the preparation of the trial on the issue of remedies, such minutes to propose dates for:
(a)the exchange of proposed declarations of contravention giving effect to the reasons published today;
(b)the filing of affidavits; and
(c)the exchange of written submissions.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
CHARLESWORTH J
PART 1: INTRODUCTION
The respondent, North Australian Aboriginal Justice Agency Ltd (ACN 118 017 842) (NAAJA) is a registered charity responsible for providing legal services to Aboriginal people in the Northern Territory. It is governed by a Constitution. Among other things, the Constitution makes provision for the election of directors of a Board, and for the Board to appoint a Chief Executive Officer (CEO). A CEO may only be terminated by a valid resolution of the Board.
The applicant, Ms Priscilla Atkins was appointed as the CEO of NAAJA in 2007 for a term of five years. That initial term of employment was extended from time to time.
On 20 February 2023 Ms Atkins received a letter giving (or purporting to give) notice that she was dismissed from her employment with NAAJA.
Ms Atkins disputes that her appointment was terminated in accordance with the Constitution. She alleges that the purported or actual termination of her employment is one of five “adverse actions” as defined in the Fair Work Act 2009 (Cth) (FW Act) taken against her by NAAJA. She alleges that NAAJA contravened s 340 of the FW Act by taking the adverse actions because she had, or had exercised, workplace rights. Those rights included her right to commence this proceeding by lodging an originating application on 20 February 2023 seeking an urgent injunction to restrain NAAJA from dismissing her, and her right to make a complaint or enquiry in relation to her employment. Among other things, she seeks injunctions restraining NAAJA from terminating her employment or preventing her from performing her duties as CEO (or alternatively an order for reinstatement), damages and the imposition of civil penalties.
By an order made on 26 April 2023 the question of liability was tried separately from questions of remedy, penalties and costs. These reasons are limited to questions of liability.
For the reasons that follow, I have concluded that the purported termination of Ms Atkins’ appointment as CEO and the purported dismissal were legally ineffective. I have also concluded that NAAJA contravened the FW Act in each of the respects alleged by Ms Atkins.
The appropriate order is that the matter now be set down for a further case management hearing to progress the trial of the remaining issues.
These reasons are structured in twelve parts:
nPart 1 ([1] – [9]) is this introduction;
nPart 2 ([10] – [18]) broadly outlines the relevant provisions of the FW Act;
nPart 3 ([19] – [152]) outlines the critical events based on agreed or admitted facts and findings drawn from uncontroversial documents or testimony;
nPart 4 ([153] – [173]) summarises the disputes on the pleadings;
nPart 5 ([174] – [179]) describes the conduct of the trial and identifies the witnesses who were called;
nPart 6 ([180] – [227]) discusses evidence relevant to the misconduct alleged against Ms Atkins;
nPart 7 ([228] – [503]) contains an outline of the witness testimony;
nPart 8 ([504] – [525]) contains findings about the workplace rights exercised or proposed to be exercised and the adverse actions taken or threatened by NAAJA;
nPart 9 ([526] – [597]) contains conclusions about whether Ms Atkins’ dismissal was legally effective;
nPart 10 ([598] – [626]) contains principles relevant to the operation of s 361 of the FW Act;
nPart 11 ([627] – [787]) contains an assessment of NAAJA’s case on those matters in respect of which it bore the onus of proof; and
nPart 12 ([788] – [789]) identifies the next steps to progress the matter to a final hearing.
Definitions
Given the intricate factual background it has been convenient to give many events and documents abbreviated names. I set out here the paragraph numbers where those events and documents are first described.
Paragraph
Number
Definition
66
2ASOC
20
ACNC
123
Allegations Letter
153
AR
253
ASIC
96
BDO
116
BDO Report
1
Board
1
CEO
34
CFO
67
Complaint
67
Complaint Right
1
Constitution
48
Contract Extension Letter
51
CPI
45
December 2017 Minutes
91
December Meeting
164
Dismissal Action
50
EA
526
Election Issue
526
Estoppel Issue
153
FAD
34
FAR Committee
188
FBT
145
February Meeting
68
First November Meeting
114
January Meeting
245
June Meeting
58
KPMG Report
162
Misconduct Action
1
NAAJA
250
NT ICAC
143
Proceedings Right
526
Quorum Issue
153
R
24
Regions
160
Review Action
161
Review Reliance Action
87
Second November Meeting
19
SOAF
157
Suspension Action
87
Suspension Resolution
150
Termination Letter
121
Termination Resolution
101
Terms
134
Updated Allegations Letter
194
Vehicle Scheme
535
voting pool
80
Ward IT Report
PART 2: THE FAIR WORK ACT
Section 340(1) of the FW Act provides:
(1) A person must not take adverse action against another person:
(a) because the other person:
(i)has a workplace right; or
(ii)has, or has not, exercised a workplace right; or
(iii)proposes or proposes not to, or has at any time proposed or proposed not to, exercise a workplace right; or
(b) to prevent the exercise of a workplace right by the other person.
Under s 341(1) of the FW Act a person has a workplace right if the person (relevantly):
…
(b)is able to initiate, or participate in, a process or proceedings under a workplace law or workplace instrument; or
(c) is able to make a complaint or inquiry:
(i)to a person or body having the capacity under a workplace law to seek compliance with that law or a workplace instrument; or
(ii)if the person is an employee—in relation to his or her employment.
This proceeding is a process or proceeding under a workplace law within the meaning of para (b): FW Act, s 341(2)(b).
The circumstances in which a person takes “adverse action against another person” are specified in a table contained in s 342(1) of the FW Act. Item 1 of the table includes action taken by an employee, including the employer dismissing the employee, injuring the employee in his or her employment, alternating the position of the employee to the employee’s prejudice or discriminating against the employee and other employees of the employer. A threat to do any one of those things will also be “adverse action”: FW Act, s 342(2)(a).
Section 360 of the FW Act provides:
360 Multiple reasons for action
For the purposes of this Part, a person takes action for a particular reason if the reasons for the action include that reason.
For contravention to be established, it is sufficient that the prohibited reason be a substantive and operative reason: Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500, Gummow and Hayne JJ (at [104]).
Section 361 of the FW Act provides:
361 Reason for action to be presumed unless proved otherwise
(1) If:
(a)in an application in relation to a contravention of this Part, it is alleged that a person took, or is taking, action for a particular reason or with a particular intent; and
(b)taking that action for that reason or with that intent would constitute a contravention of this Part;
it is presumed that the action was, or is being, taken for that reason or with that intent, unless the person proves otherwise.
(2)Subsection (1) does not apply in relation to orders for an interim injunction.
The employer’s onus under s 361 is to be discharged on the balance of probabilities: Barclay (at [63]). If the onus is not discharged, and provided that the conditions for s 361 to apply are established, then it must be presumed that the employer took the adverse action for a prohibited reason. That has some significance in the present case, as discussed elsewhere in these reasons.
Section 793 of the FW Act attributes certain conduct and states of mind to a body corporate. It too will be discussed elsewhere in these reasons.
PART 3: KEY EVENTS AND FACTS
Before turning to the pleadings it is convenient to set out some facts as agreed in a Statement of Agreed Facts dated 14 July 2023 as amended on 30 October 2023 (SOAF), and facts admitted on the pleadings. In this part of my reasons, I will also record some preliminary findings based on evidence that was not seriously contested.
NAAJA, the Constitution and the Board
NAAJA is a charity registered with the Australian Charities and Not for Profit Commission (ACNC) under the Australian Charities and Not-for-profits Commission Act 2012 (Cth). Its Constitution is dated 7 May 2018 and is lodged with the ACNC. It has more than 160 employees and has offices in Darwin, Palmerston, Katherine, Alice Springs and Tennant Creek.
NAAJA receives its funding through the Commonwealth Attorney-General’s Department, the Department of Prime Minister and Cabinet and the Northern Territory Government. The funding typically occurs in accordance with funding agreements renewed in five yearly cycles.
The object of NAAJA is set out in clause 1.2 of its Constitution. It is to provide high quality and culturally appropriate legal aid and related services for Aboriginal people in need of benevolent relief within the Northern Territory, including by providing representatives to act as support officers for Aboriginal people in custody, to assist with their rehabilitation and reform, by providing legal education to communities and by engaging in law reform relevant to those objectives. Clause 1.3 requires that NAAJA apply its funding and income solely toward promoting its objects.
In due course it will be necessary to extract and construe some critical parts of the Constitution. For now, it is sufficient to record only some of its features.
The Board is constituted in a way that ensures representation of Aboriginal people from across four defined Regions of the Northern Territory, referred to as Katherine Region, Darwin Region, Miwatj Region and Southern Region. Clause 3.3 requires that NAAJA have at least eight directors, consisting of at least two from each Region. There are to be no more than 16 directors in total, with no more than four from each Region.
Membership of NAAJA is divided into four classes, comprising Aboriginal persons who have lived in a Region for at least one year prior to the date of their nomination for membership and who continue to have their usual place of residence in that Region: Constitution, clause 2.2. Under clause 3.2, directors from each Region are appointed by members of that Region’s class.
Subject to some exceptions that are not presently relevant, the powers of the Board can only be exercised by resolutions passed at a meeting of the Board or in accordance with certain delegations of power: Constitution, clause 7.2. Provisions relating to the quorum for meetings are discussed in Part 9 of these reasons.
Clause 9.1 provides that the Board may by special resolution appoint a person to be the CEO for a specified term. The CEO is entitled to attend all Board meetings, but not to vote at them. The CEO’s remuneration is to be determined by the Board by ordinary resolution.
The role of the CEO includes (by clause 9.4(c)) the management of NAAJA on a day to day basis in accordance with delegated powers, implementation of an operation plan, and “reporting to the Board on [NAAJA’s] activities and operations”.
Clause 1.6 of the Constitution defines “special resolution” to mean:
‘special resolution’ means a resolution of the Board or members passed or required to be passed by Directors or members (whichever is applicable) that together hold not less than 75% or the total voting rights of all Directors or members (whichever is applicable) entitled to vote on the resolution who are present at the meeting.
Termination of the appointment of the CEO is provided for by clause 9.3. It provides that the appointment of a CEO terminates if the CEO resigns, or:
…
(b)the Board, by 75% majority of all Directors, removes the Chief Executive Officer from the office of chief executive officer (which, without affecting the rights of the Chief Executive Officer under any contract between the Company and the Chief Executive Officer, the Board has power to do)
Clause 17.4 has the heading “Removal of Chief Executive Officer”. It provides that the appointment of the CEO “may only be terminated if at least 75% of all Directors vote in favour of the resolution” to terminate the appointment.
The Board’s role and responsibilities are set out in a policy titled “North Australian Aboriginal Justice Agency Board Framework”, which remained current throughout 2022. It states that in accepting their positions, directors of the Board undertake to provide sound governance and effective leadership to NAAJA by ensuring that it has:
•Clear strategic directions and achievable plans in line with its purpose and values
•Adequate resources to carry out its work
•Competent personnel
•An effective policy framework to guide its work, implement its plans and meet its obligations
•Adequate internal controls to ensure sound financial management, risk management and legal compliance
•Adequate internal accountability mechanisms to ensure compliance with policies and procedures and to monitor organizational performance.
The policy goes on to state that the Board will provide direction through policy and oversight for the senior staff who will implement the decisions of the Board, and that the Board will take responsibility for, among other things:
(1)ensuring that NAAJA complies with its objects, purposes and values and with its Constitution;
(2)recruiting, supervising and evaluating the performance of the CEO;
(3)identifying and managing conflicts that may arise within NAAJA;
(4)managing risk “by assessing risks and over sighting a risk management plan or strategy”; and
(5)approving, monitoring and reviewing policies and procedures including for compliance and incident reporting.
Throughout the period relevant to this proceeding there was a Finance, Audit and Risk Committee (FAR Committee), membership of which included at least one director and the Chief Financial Officer (CFO). The FAR Committee made recommendations to the Board with respect to matters affecting NAAJA’s financial affairs and governance, including recommendations for the Board to approve financial reports.
Board Members and key personnel
Ms Colleen Rosas was first appointed a director of NAAJA in 2006 for the Darwin Region. From February 2020 she was Chairperson of the Board. Within these reasons I will refer to Ms Colleen Rosas as Ms Rosas, and Ms May Rosas as May Rosas. It is agreed that Ms Rosas was “an officer or agent of NAAJA who in relation to the matters relevant to this proceeding acted within the scope of her actual or apparent authority for and on behalf of NAAJA”.
Other current or former Board members featuring in the evidence include Ms Natalie Ellis, Ms Rebecca Moore, Ms Shirley Garlett, Ms Carol Smith, Ms Marilyn Smith, Mr Joel McLennan, Ms Araluen Maymuru, Ms Joyce Taylor, Ms Johanna Assan, May Rosas, Mr Hugh Woodbury, Ms Valda Shannon and Mr Vernon Hill. Ms Shannon is described in some materials as a director but by the conclusion of the trial NAAJA acknowledged that she did not have that status in relation to any disputed issue.
Carol Smith and Marilyn Smith resigned from the Board on 25 January 2023. Mr McLennan resigned on 7 February 2023. Ms Maymuru resigned on 15 August 2023.
From 2016, NAAJA employed Ms Madhur Evans in the position of CFO. Ms Evans was answerable to Ms Atkins in the performance of her duties.
Ms Kerry Keightley was employed by NAAJA as its Executive Services Coordinator which incorporated human resources management. Her employment was suspended in circumstances described later in these reasons.
From 30 January 2023 Mr Nicholas Espie was employed as NAAJA’s Principle Legal Officer. Mr Espie previously served as a director of NAAJA on two separate occasions: first from 29 January 2019 to 1 November 2019 and secondly from 1 October 2021 to 23 November 2022 before resigning to commence his executive role.
Mr Alistair Noel Morris and Mr Stephen Rossingh were each previously employed in the position of CFO.
Mr Philip Brown was appointed as Acting CEO and occupied the position between 5 December 2022 and 5 March 2023.
Ms Atkins’ employment
Minutes of a Board meeting held on 14 May 2015 record the Board resolving to approve a five year contract with Ms Atkins from 1 July 2015 to 30 June 2020. That resolution was seconded by Ms Rosas.
From at least May 2015, Ms Atkins was entitled to a vehicle allowance originally fixed at $11,656.00 per annum, to be indexed annually. The amount was provisionally determined and was subject to the CFO benchmarking the amount against that paid by similar organisations. The resolution for the payment of a vehicle allowance was seconded by Ms Ellis. A document recording the standard terms and conditions of Ms Atkins’ employment confirm that from at least 2015 she was entitled to receive a vehicle allowance of $20,000.00 per annum, indexed annually.
Salary increases
Minutes of a Board meeting held on 14 and 15 December 2017 (December 2017 Minutes) record a resolution by which the Board approved increases in the salaries of eight management personnel including Ms Atkins. The Minutes record that the Board had received a remuneration review report from a consultant who had reviewed salaries “in light of NAAJA delivering legal services in the Southern region commencing 1 January 2018”. The Minutes record that Ms Rosas and Ms Ellis were in attendance at that meeting and that Ms Ellis opposed the resolution. In cross-examination, Ms Rosas questioned the authenticity of those Minutes, suggesting they had been tampered with. I will return to that issue later in these reasons.
Ms Atkins’ 2017 salary increase was communicated to her by a letter sent by the then Chairperson of the NAAJA Board, Ms Ruby Stanley, dated 15 December 2017. The salary recorded in that letter is $346,830.00 per annum, being the same salary recorded in the Minutes as approved by the Board.
There were no salary increases in 2018 and 2019.
Contract Extension Letter
The most recent of Ms Atkins’ employment agreements is dated 29 June 2020, evidenced in part by a letter of that date. It will be referred to as the Contract Extension Letter.
The Contract Extension Letter is on NAAJA letterhead. It states that due to an extension in the funding of her position, Ms Atkins was offered an extension of the period of her contract to 30 June 2025. I infer that the reference in the letter to there being an extension in funding for the position coincides with the renewal of NAAJA’s funding in five yearly cycles mentioned earlier.
The extension was offered at a salary of $357,235.00 per annum. The letter stated that the North Australian Aboriginal Justice Agency Enterprise Agreement 2020 – 2024 (EA) would apply to her employment, and that in all other respects the conditions of employment would remain the same. It went on to state that if the offer was acceptable, Ms Atkins should sign the letter to signal her agreement and return it to the Executive Services Coordinator (then Ms Keightley) to enable the changes to be put into effect. The letter in evidence shows signatures above the names of Ms Rosas and Ms Atkins.
The salary specified in the Contract Extension Letter reflects the salary referred to in the December 2017 Minutes, with increases in accordance with the Consumer Price Index (CPI) as contemplated by the EA (which applied from 21 May 2020). The application of the EA (and hence the CPI increases for which it applies) is an agreed fact.
Further salary increases
There were 3% increases in Ms Atkins’ salary around June 2021 and June 2022. Those increases accord with the agreed application of the EA with respect to CPI increases.
On 30 June 2022, Ms Atkins sent an email to Ms Rosas (copied to Ms Evans) asking her to “follow up” with the approval of a recommendation that directors and management staff receive payments for additional duties associated with additional funding in the 2021/2022 financial year. The recommendation was based on an asserted “30% increase in workload and governance”.
In August 2022 the Board resolved to defer the question of those further increases pending the outcome of an organisational review discussed below. There is a dispute over whether a once-off payment to some staff was authorised but nothing significant turns on that.
Performance review
In the course of her employment, Ms Atkins participated in six-monthly performance reviews. Ms Atkins’ evidence is that she had never received a negative report about her performance in any of those reviews. That evidence was neither challenged nor contradicted and I accept it.
On 5 October 2022, Ms Atkins attended a meeting with Ms Rosas, Mr Brown and Carol Smith for the purpose of a performance review interview. In advance of the meeting, Ms Atkins prepared a document titled “Priscilla Atkins Performance Report 1 January 2022 to 30 June 2022” in which she self-assessed her performance against a number of indicators.
Ms Atkins asserted that no negative issues concerning her performance or competence were raised with her during that meeting. I accept that evidence. Ms Rosas acknowledged that at the performance review interview she had told Ms Atkins that she thought “her work had been really good”. I also accept evidence adduced by NAAJA that a forward looking aspect of the performance review was not completed at that time, specifically because the role of the CEO formed a part of the organisational review then underway.
KPMG Report
Between October and November 2022, a “Strategic and Governance Review” of NAAJA was carried out by consultancy firm KPMG in accordance with a resolution of the Board made in June of that year (KPMG Report). The “auspicing arrangements” involved NAAJA providing corporate support and guidance to Aboriginal organisations specifically with a view to improving their corporate affairs, financial reporting and governance. The tender for the service ultimately carried out by KPMG was confined to a review of NAAJA’s organisational structure, CEO and Board responsibilities, human resources structure and function, and strategic and operational plans.
The KPMG Report included consultation with directors who self-nominated to be interviewed. KMPG’s draft findings were presented to a Board meeting on 9 December 2022, and its final findings and recommendations were presented in January 2023. They included a finding that the operation of the Board had not evolved in response to growth in NAAJA’s size and complexity to provide sufficient oversight of the organisation. KPMG also found that the CEO and Board members did not have a good understanding of the Board’s role and responsibilities. KPMG recorded the view of “Board members” that they only received information about NAAJA through the CEO or occasionally from its CFO in relation to financial matters, and that they had made requests for more information that had been refused, including information relating to “matters such as staff remuneration, general human resources issues, detail about budgets and financial results, and allocation of surpluses”. KPMG reported that the CEO had assumed responsibility for the administrative operation of the Board (including scheduling, paper distribution and agenda setting), which had “resulted in significant friction and erosion of trust between the Board and the CEO, and the Board believing they do not have adequate oversight or control of the organisation or the CEO”. KPMG made a number of recommendations on that topic, including that the Board members receive training about their role, responsibilities and authority and other governance training, that the role of the Board be communicated to senior personnel, and that the Board receive additional specialist support from non-executive members in the areas of finance, human resources and legal practice.
Request for contracts and salaries
On 18 October 2022, Ms Rosas sent an email to Ms Keightley asking for copies of contracts for three staff, including Ms Atkins and Ms Evans. She emailed Ms Keightley again on 19 October 2022 asking when she would receive the documents “as I need to sight them before I meet with the consultants”.
Ms Keightley provided copies of the documents by way of attachments to an email on the morning of 19 October 2022, including a copy of the Contract Extension Letter. In the body of her email, Ms Keightley referred to that letter as “confirming contract extension to 30/06/2025” and also stated that the salaries of the various employees had been updated on 1 July 2022 in accordance with the CPI. Later, on 19 October 2022, Ms Rosas sent copies of the three contracts to directors, stating that she would be “more than happy to discuss these contracts at our board meeting in the in camera session”.
From at least early November 2022, the Board was considering the appointment of a new Principal Legal Officer (at times referred to as the PLO). On 3 November 2022, Ms Rosas sent an email to Ms Atkins in the following terms:
Hi [Ms Atkins],
Can you please send through staff contracts with salary levels for the following people; Yourself Madua [sic] Beth Clara Anna Cindy Mark.
The Board can have a look at this in determining the salary of the PLO.
Ms Atkins sent a response on the same day, attaching a copy of the Contract Extension Letter as well as the contracts for all but one of the named staff members.
By an email dated 7 November 2022 (at 4.34pm), Ms Rosas asked Ms Atkins to send her the salaries for nine employees (including Ms Atkins herself). In the email, Ms Rosas said if Ms Atkins did not have time, the salaries could be provided by Ms Evans “as she is here in Alice”.
Ms Atkins responded to that request by an email sent on 8 November 2022 at 10.15am.
The Complaint
On 7 November 2022, Ms Atkins sent an email to Ms Rosas, Carol Smith and Marilyn Smith raising issues about the conduct and performance of the CFO, Ms Evans. The effect of the complaints is summarised at [9] in Ms Atkins’ Second Amended Statement of Claim (2ASOC) filed 27 September 2023 as follows:
•Ms Evans engaged in conduct amounting to bullying of other NAAJA employees;
•Ms Evans refused to follow reasonable and lawful directions from Ms Atkins;
•Ms Evans purported to enter into transactions, including significant transactions, on behalf of NAAJA without authority from either Ms Atkins or NAAJA’s Board;
•Ms Evans disclosing [sic] NAAJA’s confidential information without authority from either Ms Atkins or the Board;
•Ms Evans accessed Ms Atkins’ work computer after-hours, without Ms Atkins’ permission;
•Ms Evans recorded interactions within the workplace, without the knowledge or consent of other parties to the interaction;
•Ms Evans failed to use her NAAJA-issued credit card in accordance with the relevant NAAJA policy and
•Ms Evans made payments to Ms Rosas without Ms Atkins’ knowledge or authority to which Ms Rosas was not otherwise entitled.
It is common ground that the matters raised in the email were complaints and inquiries that Ms Atkins was able to make in relation to her employment and that, by sending the email, Ms Atkins had exercised a workplace right within the meaning of s 341 of the FW Act. I am satisfied that is so in any event because Ms Atkins was responsible for managing the day to day operations of NAAJA, was responsible for reporting to the Board, and her position involved the supervision of senior staff including Ms Evans. I will refer to the email as the Complaint, and the right to make the Complaint as the Complaint Right.
10 and 11 November Board Meeting
There were two Board meetings in November 2022. The first was held on 10 and 11 November at Alice Springs (First November Meeting). It is sufficient at this juncture to briefly describe three events that occurred there.
First, Ms Rosas circulated a copy of the Complaint to directors. The Board agreed that Ms Evans should be given the opportunity to respond to the matters Ms Atkins had raised. The things said or thought by individual directors about the Complaint will be discussed elsewhere.
On 10 November 2022 at 11:37am, Ms Rosas sent an email to Ms Evans stating, without introduction or explanation:
Hi Madhur
Please see attached complaint for your response
Kind regards …
Second, Ms Rosas raised an issue concerning the renewal of Ms Atkins’ contract. She told directors that she had not signed the Contract Extension Letter and asserted that her electronic signature must have been applied to it without her approval. The Board agreed that a director, Ms Garlett, should arrange for NAAJA’s IT personnel to investigate the document and the use of any electronic signature on it.
Third, Ms Atkins attended the Board meeting on the morning of 11 November. Ms Atkins told the Court (and I accept) that when she arrived, Ms Moore asked “[w]ho approves your salary?” to which Ms Atkins responded “[t]he Board does”. Ms Moore then asked “[i]sn’t it about time you had a performance review?”. Ms Atkins replied that she had just had a performance review in October. Ms Rosas said “I don’t recall that”. Mr Brown and Carol Smith said “[Ms Rosas], you were there for that performance review”.
Ms Evans sends an email to Ms Rosas
On the morning of 11 November 2022, Ms Evans sent an email to Ms Rosas attaching a copy of the Complaint. Her message was as follows:
Hi [Ms Rosas],
Thanks for sending me the complaint. I will be vigorously defending my case from calling on witnesses and providing evidence through source documents. 90% of her written complaint is to undermine, Harras and bully me. This whole thing is designed to push me out.
She did not follow the grievance policy. This is her first breach.
I want to know from the Board. What guarantee I have that she will not sack me?
Secondly, how will I be protected from such behaviuor [sic] whilst the review and recommendation are still in progress.
Thanks
Madhur
Requests for copies of Ms Atkins’ contract
On 14 and 15 November 2022, there were exchanges of emails between Ms Rosas and Ms Atkins. Ms Rosas told Ms Atkins that she was coming into the office on the Wednesday morning of that week and requested that Ms Atkins make available “the original of the letter of offer to you with my signature”. In her response, Ms Atkins attached a copy of the Contract Extension Letter and asked whether that was the document Ms Rosas was seeking. Ms Rosas responded “Yes, I will need to see the hard copy when I come in”.
Emails from Ms Ellis to directors
In an email sent from Ms Ellis to the other directors of NAAJA on 13 November 2022, Ms Ellis stated:
There are a few things that I feel need following up:
…
•When can we expect an action item and timeframe for the CEO contract extension conflict?
•When and how will the grievance submitted by CEO against CFO be addressed – reading through these complaints, much of this relates to the CEO not following our grievance process, how will this be addressed
…
•Can the date for the meet for Review presentation be confirmed?
There are so many issues that need addressing and I get that we are waiting for the review to be completed and presented, but we can start looking at what significant changes need to be made moving forward.
Signature allegation
On 15 November 2022, there was at least one telephone conversation between Ms Rosas and Ms Atkins. There is a dispute about the number of calls. I find that the call or calls were initiated by Ms Atkins who had learned through others that an issue had arisen concerning her contract.
The content of the telephone conversation is disputed in part.
Ms Atkins said that Ms Rosas asserted that the Board had not approved her salary nor the extension of her contract, that she (Ms Rosas) had not signed the Contract Extension Letter, and that Ms Atkins had applied her (Ms Rosas’) electronic signature to the document without her consent.
I find that Ms Rosas’ allegations angered Ms Atkins, and that Ms Atkins in a heated exchange said (at least) that Ms Rosas had falsely accused her of criminal conduct. Ms Atkins also alleged that Ms Rosas had breached confidentiality by providing a copy of the Complaint to Ms Evans.
The Ward IT Report
Mr Greg Ward was an IT Systems Specialist employed by NAAJA. On 14 November 2022, Mr Ward sent an email to Ms Garlett attaching a report into the “origins” of the Contract Extension Letter (Ward IT Report).
Mr Ward reported that in NAJAA’s systems there were no earlier drafts of the Contract Extension Letter, no versions created in Word, and that there existed two copies of a PDF version, one stored in a folder titled “Corporate HR” and one stored in Ms Atkins’ home directory. The PDF version was a scan of a hard copy. He reported that the signatures appearing on the PDF version were combined in the single scanned graphic image. The document was different from what he termed “all staff” contract extension documents which did not require the signature of the Chairperson. He said that no unsigned copy of the Contract Extension Letter could be found on NAAJA’s systems. He reported that there was no evidence to suggest either that an electronic signature or a manual signature had been applied to the original, but did not state that he had undertaken any search for a hard copy original containing a manual signature. He reported that there were two emails in Ms Atkins’ inbox relating to the Contract Extension Letter, although neither of them had been sent around the time the document was signed or created. There were three emails relating to the Contract Extension Letter in Ms Keightley’s inbox. One of them evidenced Ms Keightley sending the signed document to Ms Atkins on 6 July 2020, copying another staff member, Ms Clare Parsons, in her message, stating “please find a copy of your letter attached”. Mr Ward reported that there were no emails between Ms Keightley and Ms Rosas concerning the document around that time and no evidence that Ms Rosas had been sent a copy of it. Mr Ward also reported that he had found two different copies of an electronic signature for Ms Rosas on NAAJA’s systems, but neither of them appeared to match the signature on the Contract Extension Letter.
A further observation may be made about documents attached to the Ward IT Report.
By email exchanges in late June, Ms Keightley told Ms Parsons that it had been confirmed that CPI increases applied to all staff members and that she would be using a master template document “for all letters”. Ms Keightley also emailed Ms Parsons to check a spreadsheet setting out rates of staff pay, including Ms Atkins’ salary. The salary recorded in the spreadsheet is the same as identified in the Contract Extension Letter.
Ms Atkins’ absence on sick leave
On the evening of 15 November 2022, Ms Atkins sent an email to directors advising that she was taking “unexpected leave” from 15 November 2022 until 13 December 2022. On the following day she obtained a worker’s compensation medical certificate covering that period. That Ms Atkins was too unwell to attend the workplace at the time of the email was not disputed by NAAJA and I proceed on that basis. At that time, Ms Atkins had a legal entitlement to return to the workplace in the event that she became well again to perform her duties.
From 5 December 2022, Mr Brown (Ms Rosas’ nephew) was appointed as NAAJA’s Acting CEO.
Ms Atkins obtains letters of support
On 19 November 2022, Ms Atkins sent or attempted to send an email to 30 recipients including NAAJA staff and stakeholders asking them to write “support letters” highlighting the work that she did for NAAJA. She did not disclose to the recipients the purpose of the letters nor the accusation that had been made against her.
23 November Board meeting
There was a further Board meeting on 23 November 2023 (Second November Meeting). At that meeting, directors considered the Ward IT Report. All but one of the directors who attended joined in a resolution that both Ms Atkins and Ms Keightley should be suspended whilst an investigation occurred into the issue concerning the use of Ms Rosas’ signature (Suspension Resolution). The reasons each director gave for agreeing to the suspension will be considered later in these reasons.
Suspension of employment
On 28 November 2022, Ms Rosas and Mr McLennan sent a letter to Ms Atkins directing her not to attend at the workplace or perform work. The letter was expressed as follows:
Dear [Ms Atkins]
Direction to not attend nor perform work (suspension from duties on pay)
NAAJA has recently become concerned about your contractual and salary arrangements and whether they were properly approved.
While we understand that you are currently unable to attend work due to an illness, so that we can properly assess and consider these concerns, the Board of NAAJA has resolved to direct you to not perform work, nor attend work. This decision was made by resolution of the Board on 23 November 2022. Your access to NAAJA’s IT systems is also suspended.
We are now investigating and assessing the issues of concern and we will be in touch with you as soon as possible regarding our more specific concerns so have the opportunity to respond. The Board has not made any determination yet about the concerns.
Please note that this investigation is strictly confidential and you are not to discuss it with anyone – although we recognise that the situation may create pressures and difficulties for you. We encourage you to seek medical or other health support, as you need.
You will continue to be paid while you remain suspended.
From that time, Ms Atkins was prohibited from returning to the workplace or performing her duties.
Ms Evans responds to the Complaint
By email dated 29 November 2023 Ms Evans responded to the allegations made about her in the Complaint. Her response was not provided to Ms Atkins for comment.
10 December Board Meeting
There was a further meeting of the Board on 10 December 2022 (December Meeting). The minutes show that Ms Evans was in attendance. They record that Ms Assan “raised the progress of the investigation for the Executive Services Coordinator and the CEO”, that Ms Ellis queried whether Ms Atkins’ laptop had been retrieved, and Ms Rosas raised an action item for that to be done and that Ms Ellis also queried “what exactly were the Board going to be investigating”.
A further message from Ms Ellis
Ms Ellis sent a further email to five directors of NAAJA on 14 December 2022 attaching a document with the heading “CONCERNS RE CEO AND OTHERS – NAAJA”. The first paragraph under the heading stated:
How is the grievance CEO submitted against CFO going to be addressed and resolved. There are clearly some red flags with some of the allegations, which I feel actually reflect on CEO performance and inability to address issues, for example staff grievances/complaints, implementation of policies. CEO has not provided evidence in any of her complaints.
The email also raised the topic of the “CEO salary”, under which there appeared dot points including the following:
•The contract extension and Chairperson’s signature
•Need access to the Renumeration [sic] Committee Minutes
The email went on to say that Ms Ellis agreed with some points that had been raised by Ms Moore and concluded: “I do not think it is tenable that there can be a future working relationship with Board and CEO”.
NAAJA sends a process server
By letter dated 22 December 2022, NAAJA (through Mr Brown) demanded that Ms Atkins surrender NAAJA IT equipment in her possession to “Top End Bailiff and Collection Services”. A process server attended at Ms Atkins’ home with the letter on that day. That occurred in circumstances where Ms Atkins had, through her lawyer, previously offered to deliver up her laptop at a mutually convenient time and NAAJA had not responded. Ms Atkins delivered the laptop to NAAJA on the following day. Her access to NAAJA’s information systems had been suspended for some time before that, from at least the time of her suspension.
Engagement of BDO
BDO Australia Ltd was engaged to conduct a “special audit” of a wide range of matters relating to Ms Atkins. Precisely how and when that occurred is the subject of some consideration later in these reasons.
NAAJA’s records show that on 22 December 2022, Mr Brown sent an email to Mr Casmel Taziwa in which he said that he had been given Mr Taziwa’s number by Ms Evans. In a further email to Mr Taziwa sent on the same day, Mr Brown said again that Ms Evans had provided him with Mr Taziwa’s contact details and that “[Ms Evans] may have already given you a brief on what we require”. There is no evidence explaining how Ms Evans was put in a position to give Mr Taziwa a “brief” of what was required, nor as to who authorised her to converse with any person from BDO about any investigation into the conduct of Ms Atkins.
An appointment was made for the following day for what Mr Taziwa described as “the preliminary discussion”.
Mr Brown and Ms Rosas (at least) met with Mr Taziwa on 23 December 2022.
Ms Rosas told the Court that BDO had been recommended “to the Board” by Ms Evans (the person against whom Ms Atkins had made allegations in the Complaint). How, when and why that recommendation was made is not explained in NAAJA’s affidavits.
BDO Terms of Reference
A document titled “Terms of Reference” was signed by Ms Garlett, Ms Ellis and Ms Moore on 2 and 3 January 2023. I will refer to it as the Terms.
The Terms direct BDO to “review, analyse and report back to the NAJJA [sic] Board on any irregular or inappropriate actions within specified areas of the Chief Executive Officer role, responsibilities and accountabilities in Corporate Governance of the organisation.” BDO was required to include in its report advice as to whether Ms Atkins “has breached NAAJA Policy & Procedures, delegations and authorisations in which may disclose criminal activity and Police involvement [sic]”. The Terms go on to state:
These breaches must identify if they were intentionally or unintentionally and if any unethical practices that would bring NAAJA’s reputation as a legal justice agency into disrepute.
Under the heading “Scope of Works” there appear “Priority” questions and other questions under the heading “Medium”. BDO was directed to report on the “Priority” matters by close of business on 11 January 2023.
Emails in evidence show that on 10 January 2023 Ms Evans was having communications with personnel from BDO, referring to her by her initials and also by her first name, and that BDO were directing their enquiries for additional documents to her. A further email sent by BDO to Ms Evans on 30 January 2023 seeks assistance in collating documents “in respect of the request made by [Ms Atkins’] lawyers”. Ms Evans was also provided with the “updated report as discussed” by email sent by Mr Taziwa on the morning of 2 February 2023. The timing and content of the discussion referred to in that email is unknown.
NAAJA called neither Ms Evans nor Mr Taziwa to give evidence at the trial.
Ms Rosas convenes a meeting
On 4 January 2023 (two days after the Terms were signed) Ms Rosas sent a message to directors with the subject “Dates for Board Meeting 12/13 January 2023”. She sought clarification about who would be available for a meeting on those dates, and continued:
As the CEO’s lawyer has given the NAAJA Board until 16 January to respond to their request before legal action against NAAJA is taken, we will need to meet to discuss the following:
Draft investigation Report
NAAJA Structure
NAAJA Constitution
…
The email contains no reference to the engagement of BDO and no reference to any expected report concerning Ms Atkins, nor does it foreshadow any motion to terminate her employment. On its terms the email records an awareness that Ms Atkins had by that time threatened legal action in connection with the ongoing suspension of her employment and had fixed a deadline after which legal action would be taken.
Ms Atkins sends information and documents to BDO
Neither NAAJA nor Mr Taziwa had notified Ms Atkins of the engagement of BDO, nor did they provide her with an opportunity to provide evidence or make submissions about any of the subject matter referred to in the Terms. I find that Ms Atkins became aware of the engagement of BDO from others, that she had some limited knowledge about the subject matter of the investigation but was not aware at that time of the Terms.
On 9 January 2023 Ms Atkins sent an email to Mr Taziwa attaching a number of documents relevant to two matters she believed he was investigating.
Mr Taziwa did not contact Ms Atkins, nor (I find) did he read her correspondence. Other evidence discloses that Mr Taziwa was directed by NAAJA not to engage in any communications with her.
BDO returns Ms Atkins’ correspondence to Ms Rosas
By an email sent on 11 January 2023, Mr Taziwa forwarded to Ms Rosas the materials sent to him by Ms Atkins. His email stated:
Please find attached the emails which I received from [Ms Atkins] in the past two days as discussed in our meeting yesterday.
As indicated to you, I have not gone through the detail of the contents and attachments so as to avoid tainting the current work which we are currently undertaking for NAAJA.
Ms Rosas told the Court that she read Ms Atkins’ correspondence directed to BDO.
Ms Rosas also told the Court that she provided the correspondence with its attachments to the Board at a meeting held three days later. I have rejected that evidence for reasons that will be explained.
January Board meeting and BDO Report
There was a further meeting of directors on 12 and 13 January 2023 (January Meeting).
Handwritten minutes were taken of the January Meeting, and those minutes were later typed and signed by Ms Rosas on 1 March 2023. The following persons are identified in the minutes as directors in attendance, together with their location:
(1)Ms Rosas, Darwin;
(2)Ms Ellis, Katherine;
(3)Ms Moore, Tennant Creek;
(4)May Rosas, Katherine;
(5)Mr McLennan, Darwin;
(6)Mr Hill, Katherine;
(7)Ms Assan, Miwatj;
(8)Ms Maymuru, Miwatj (attending via Zoom);
(9)Ms Taylor, proxy for Carol Smith, Southern;
(10)Mr Woodbury, proxy for Marilyn Smith, Southern;
(11)Ms Garlett, Katherine; and
(12)Ms Shannon, Tennant Creek.
Mr Taziwa attended on the first day of the January Meeting. He made an oral presentation supported by a document titled “Audit Investigation Report” (BDO Report). Its contents are discussed in a different section of these reasons. To understand what happened next, it is necessary to briefly describe its contents.
The BDO Report refers to an “opening meeting with the management and key stakeholders”. Dot points refer to BDO developing “a high-level understanding of the process”, discussing key concerns in the existing process with “the entity’s key officers” and confirming client service expectations and project deadlines. When those meetings and discussions occurred and the identity of the officers or “stakeholders” who took part in them is not disclosed.
The BDO Report also refers to a meeting with the Acting CEO (Mr Brown), the CFO (Ms Evans) and the Senior Revenue Officer by which BDO “obtained an understanding of the existing process and the system functionalities”. No attendees at that meeting gave evidence. It is unclear when it occurred. The Report also refers to BDO obtaining “details and documents for the period agreed for testing (from January 2017 to current)”. The identity of the person who provided the “details and documents” is not disclosed in the BDO Report.
The BDO Report then reproduces the Terms, before setting out “factual findings”, including in relation to “observations” on topics referred to as “use of NAAJA funds for the private purchase of staff personal vehicles through salary sacrifice process” and “CEO’s credit card expenditure for the period 1 January 2019 to 30 November 2022”.
The Minutes of the January Meeting relevantly record the following resolutions:
Board discussion on Audit Investigation Report
RESOLUTION:
The NAAJA Board resolves that the information provided by the Auditors, BDO, be presented to lawyers for further advice.
MOVED: Shirley Garlett
SECONDED: Joel McLennan
UNANIMOUSLY AGREED
RESOLUTION:
The NAAJA Board resolves that the information provided by the BDO investigation outcome be reported to the police.
MOVED: Natalie Ellis
SECONDED: Valda Shannon
UNANIMOUSLY AGREED
RESOLUTION:
The NAAJA Board agreed that the information provided by BDO investigation outcome be reported to the police and CEO be terminated.
MOVED: Joel McLennan
SECONDED: Natalie Ellis
Resolution Carried
RESOLUTION:
The NAAJA Board resolves to notify the police and terminate the CEO immediately after the meeting with Northern Territory and Commonwealth Attorneys-General .
MOVED: Natalie Ellis
SECONDED: Valda Shannon
ABSTAIN: Rebecca Moore
Resolution carried
The third and fourth of those resolutions will together be referred to as the Termination Resolution. Notably, the fourth resolution provided that the CEO be “terminated” immediately following a meeting with the Attorneys-General.
A meeting between Ms Rosas and the Attorneys-General took place four days later. However, Ms Atkins was not notified immediately after that meeting that her appointment was terminated as contemplated by the Termination Resolution, nor was the question of whether her appointment should be terminated considered again at any meeting of the Board.
Allegations Letter
On 19 January 2023, Ms Atkins received a letter signed by Ms Rosas, with the heading “Opportunity to respond and show cause” (Allegations Letter). It is an agreed fact that Ms Rosas sent that letter “for and on behalf of NAAJA”: SOAF, [24].
In the letter, Ms Rosas referred to an “ongoing investigation” said to concern Ms Atkins’ conduct during her employment. She said that a number of allegations had been raised against Ms Atkins “as a consequence of” the investigation. An annexure to the letter briefly asserted eight allegations, none of which related to the use of Ms Rosas’ signature on the Contract Extension Letter.
Ms Rosas went on to say that it was “NAAJA’s preliminary view, based on the investigation process conducted to date, is that the Allegations are likely to be substantiated and, if so, would constitute a breach of NAAJA’s policies, your employment contract and applicable laws”. She said that NAAJA had “not yet formed a view as to your ongoing employment” and that, “having regard to the serious nature of the Allegations, an appropriate outcome may be the termination of your employment with NAAJA”.
Ms Rosas went on to state that the purpose of her letter was to provide Ms Atkins with an opportunity to respond and to raise any other matters that she wished NAAJA to take into account “when finalising its investigation into the Allegations and making a decision as to your ongoing employment”. She stated that:
NAAJA will consider any response you provide before it makes any decision in relation to your ongoing employment and/or any other appropriate outcome.
The allegations against Ms Atkins were revised in a further letter dated 3 February 2023 sent by NAAJA’s lawyers, Mr Murray Kellock of King & Wood Mallesons. The letter asserted that “time is of the essence” and required Ms Atkins’ response by 17 February 2023. The revised allegations contained in that letter are also summarised in Part 6 below.
Fair Work Commission
Around 22 January 2023 Ms Atkins made an application to the Fair Work Commission relating to her employment. The details of that application are not known to the Court.
The Complaint about Ms Evans goes no further
Mr Brown wrote to Ms Evans on behalf of the Board on 30 January 2023. After some introductory paragraphs, his letter stated:
The Board have taken into account your response and acknowledged that these allegations were operational matters that the Chief Executive Officer should have addressed with you at the appropriate times when they surfaced, not for the Board to address.
On behalf of the Board, I wish to advise that this matter is now closed, however the Board gives you the opportunity to meet with them to address any concerns in the allegations with them personally.
Notwithstanding the reference to “the Board” in that letter there is no evidence that Ms Evans’ response was the subject of discussion at (or resolution passed at) any Board meeting. Whether, when and how the Board collectively took the response into account or made the acknowledgments referred to in the letter remains unclear.
Mr Taziwa corresponds with Ms Evans
On 2 February 2023, Mr Taziwa sent an “updated” report to Mr Brown which he said included “a conclusion which seeks to capture the key issues of now [sic] compliance as we view them.” The message continued:
In going through this exercise, we have identified the matters which we have highlighted together with the letter from Murray forms a basis of the documents which you will need for your discussions with the Commissioner this afternoon.
Mr Taziwa forwarded that message with the attachment to Ms Evans on the same day, with a message saying “Please find attached the updated report as discussed”.
The meaning of the reference to “discussions with the Commissioner” in the email to Mr Brown is unexplained. The reference to a prior discussion between Mr Taziwa and Ms Evans is also unexplained.
Updated Allegations Letter
NAAJA’s lawyers sent a letter to Ms Atkins’ lawyer on 3 February 2023 revising the allegations that had previously been made. It will be referred to as the Updated Allegations Letter, and its contents will be discussed in a different section of these reasons.
These proceedings threatened
Ms Atkins’ lawyer later wrote to Mr Kellock on 14 February 2023 complaining about the manner in which the allegations had evolved and asking for a further week in which to respond. Ms Atkins also requested that NAAJA undertake not to terminate her employment and sought a response to that request by 16 February 2023. She said that in the event that no undertaking was agreed she reserved the right to commence proceedings, and to seek urgent relief, without further notice.
The extension request was refused, as was the request for the undertakings. In his response, Mr Kellock said that Ms Atkins “has been given ample procedural fairness; indeed more than could reasonably be expected in the circumstances”.
By a further letter sent on the following day, Ms Atkins’s lawyer repeated the request for undertakings, specifically in the following terms:
1.NAAJA will not finalise its investigation into any of the allegations contained in the stand down allegations letter, the principal allegations letter (as amended by the amended allegations letter) until it has considered our client's response to those allegations and any other matter that she wishes to raise (see opportunity (ii) of the principal allegations letter).
2.NAAJA will extend the time for that response until Friday 24 February 2023, or such later time as may be agreed between NAAJA and our client which agreement shall not unreasonably be withheld.
3.NAAJA will not terminate our client’s employment (or take any other disciplinary step against our client) until it has afforded our client the opportunity to show cause (opportunity (iii) of the principal allegations letter) in response to, and on the basis of, those allegations it finds are substantiated once the investigation is finalised having completed steps 1 and 2 above.
4.If following step 3 above, NAAJA decides to terminate our client’s employment (or take any other disciplinary step against our client) it will give our client 72 hours’ notice of its decision to do so.
That letter went on to state:
Please advise whether your client is prepared to provide an undertaking in the terms we have requested by no later than 12 pm on Thursday 16 February 2023. In the event your client does not agree, or we do not receive a response by this time, our client reserves the right to commence proceedings, and to seek urgent relief, without further notice and to rely upon this correspondence should it do so.
Our client otherwise reserves her rights.
(emphasis in original)
Ms Atkins responds to the allegations
Ms Atkins gave a partial response to the some of the allegations by letter from her lawyer to Mr Kellock dated 17 February 2023. She reiterated that she required more time to complete her response, including because she was obtaining information from two former CFO’s of NAAJA (Mr Morris and Mr Rossingh) and because she had an outstanding request to access NAAJA’s systems to obtain documents relevant to her response. The cover letter assumes some significance in what follows and so is extracted here in full:
We refer to the letters from Colleen Rosas on behalf of NAAJA to our client dated 28 November 2022 and 19 January 2023 and your letter to us of 3 February 2023.
There have been three iterations of allegations raised against our client.
We note that the first iteration of allegations raised against our client on 28 November 2022 – which contained the extremely serious allegation that our client had, without authority, applied or affixed Ms Rosas’ electronic signature to a letter dated 29 June 2020 - has been abandoned by your client.
This has occurred notwithstanding that this first iteration of allegations was the basis upon which our client was suspended from work, and was the sole identified subject of the investigation first notified to our client in Ms Rosas’ letter to our client 28 November 2022.
Notwithstanding the shambolic process adopted by your client to date, our client has been able to provide a partial response to the current iteration of allegations annexed to your letter to us of 3 February 2023.
The partial response prepared by our client is attached and marked ‘Attachment A’.
As we have explained to you already in our correspondence dated 14 and 15 February 2023, our client requires further time to prepare a complete response to the Allegations, having regard the historical nature of the allegations against her and the extended time period to which they relate.
Further, she can only be in a position to show cause why her employment should not be terminated, in accordance Ms Rosas’ letter to our client on 19 January 2023, once she has a complete response to the Allegations.
She will provide her complete response to the Allegations, and a response to the invitation to show cause why her employment should not be terminated, by Friday 24 January 2023.
In particular, we note that she intends to rely on material and information provided by two previous Chief Financial Officers of NAAJA, Noel Morris and Stephen Rossingh. We have only recently been able to establish contact with them and require time to complete gathering material and information from them.
Given that the current iteration of allegations annexed to your letter to us of 3 February 2023 primarily relate to matters of alleged financial mismanagement or misconduct occurring when Mr Morris or Mr Rossingh was the CFO of NAAJA (or, in Mr Rossing’s [sic] case, the Independent Chairperson of the Finance and Audit Risk Committee), the material and information they can provide is extremely probative and possibly determinative of one or more of the allegations raised.
Further, our client reserves the right to provide further particulars upon receipt of the additional material previously requested, including access to the NAAJA IT system.
Our client reiterates that she requires such access in order to locate such relevant documents as may still exist, and to have a genuine and meaningful opportunity to respond to the current iteration of the allegations.
(emphasis in original)
Ms Atkins provided documents in support of the partial response, some of which had earlier been provided to Mr Taziwa. They are discussed elsewhere in these reasons.
This proceeding lodged and notified to NAAJA’s lawyer
On 20 February 2023 at 12.09pm (ACST), Ms Atkins lodged in this Court the originating application in this proceeding. The originating application contained claims for urgent interlocutory injunctions restraining NAAJA from:
(1)taking any further step or further acting on its investigation of misconduct alleged in the Updated Allegations Letter;
(2)refusing to permit her from performing her duties as CEO in reliance upon the investigation; and
(3)terminating her employment because of or for reasons including any of the alleged misconduct.
Unsealed copies of the originating application and supporting affidavit were sent to NAAJA’s lawyers at 1.59pm (AEST) on 20 February 2023.
It is not disputed that the action in this Court is a process or proceeding under a workplace law within the meaning of s 341(2)(b) of the FW Act and that by reason of those matters, Ms Atkins had a workplace right within the meaning of s 341(2)(b) of the FW Act that she proposed to exercise (by foreshadowing the litigation at least in correspondence on 14 and 15 February 2023) and that she in fact exercised (by commencing it). I will refer to that as the Proceedings Right.
The originating application was not sealed by Court on 20 February 2023 and, as a consequence, there was no formal service of the proceedings on NAAJA on that day.
20 February meeting
On 20 February 2023 at about 4.30pm there was a telephone meeting with Mr Kellock (and two other lawyers from King & Wood Mallesons) to discuss Ms Atkins’ response to the allegations (February Meeting). Those in attendance included Ms Rosas, Ms Ellis, Mr Espie (then appointed as NAAJA’s Principal Legal Officer), Ms Evans, Mr Taziwa and Ms Rena Stanton and Ms Moore.
Ms Stanton was referred to in evidence as an administrative officer responsible for taking minutes of NAJAA’s meetings, although no minutes emanating from NAJAA were admitted in evidence in connection with the February Meeting.
A file note of the meeting was taken by a person employed by NAAJA’s lawyers. The typewritten note contains a statement that it was prepared by Ms Sarah Tyrrell and that it was not and should not be regarded as a verbatim record of the telephone call.
The document was admitted in evidence as a record that accorded with Ms Rosas’ recollection of events. I do not consider that to be a wholly reliable or complete record as to what occurred for reasons I will later explain.
The notes record events to the following effect:
(1)Ms Rosas referred to Ms Atkins’ response as “straight out lies” and said that “so many things … are absolutely fabricated”.
(2)Mr Kellock said “Is that a unanimous decision of the Board?”
(3)Ms Rosas said “Yes, a majority of the Board – the ones we have been able to speak to all agreed. The Board agreed at our last board meeting on 12 and 30 [sic] January to terminate her when we didn’t get any responses. We can get the minutes for that. No one knows [sic] anything about the other 8 vehicles until we got the report from [Mr Taziwa]”.
(4)Mr Espie queried whether it was necessary for the Board to be reconvened.
(5)Ms Ellis responded “[t]he Board have agreed”.
(6)Mr Espie asked whether an “updated decision” was needed.
(7)Ms Rosas responded “[n]o”.
(8)The content of a letter giving notice of the termination was discussed. Ms Rosas confirmed that she would sign the letter that day, return it to Mr Kellock, and then send it to the Board.
(9)Mr Kellock said:
Thank you for giving me that instruction.
I now need to tell you something, that will not surprise you. I am glad you told me you’ve made that decision, and we can execute it today.
[Ms Atkins] has instituted Federal Court proceedings late this afternoon against The NAAJA. Basically, it’s an adverse action claim. As part of those proceedings, she has sought an urgent interlocutory injunction to make any decision to terminate. I didn’t want to tell you about that until I heard from you what you wanted to do – but you were clear that you had decided to terminate already, so we should proceed down that path. That interlocutory application will disappear now that you have made the decision to terminate. Does that make sense?
Termination Letter
At 6.23pm on 20 February 2023, Mr Kellock sent a letter to Ms Atkins’ lawyer attaching a letter signed by Ms Rosas giving or purporting to give notice that her employment was terminated (Termination Letter). Among other things, the letter stated:
Having regard to your response to show-cause, as contained in that correspondence, and for otherwise lawful reasons, NAAIA has determined that it has completely lost trust and confidence in you in the continued performance of the role of Chief Executive Officer of NAAJA. Amongst other reasons, your response illustrates, in NAAJA’s view, dishonesty and potential unlawful conduct and accordingly, your continued employment is simply untenable. Indeed, NAAJA has already referred particular concerns in relation to your conduct to the Northern Territory police.
Accordingly, we advise that your employment is terminated effective immediately. You will now be made a payment in lieu of your applicable notice period and all other contractual/statutory entitlements owed to you also be paid to you.
Mr Kellock’s covering email said that Ms Atkins’ employment had been “terminated, effective immediately”. He said that Ms Atkins should immediately discontinue her claims for interlocutory relief because they were “redundant/futile” given that the employment had been terminated.
First case management hearing
On 21 February 2023 the matter came before me for a case management hearing to deal with Ms Atkins’ urgent application for an injunction restraining the termination of her employment. At the hearing, Mr Kellock told the Court that Ms Atkins’ employment had been terminated on the previous day and that the application for interlocutory relief was “dead in the water”. He said that the decision to terminate Ms Atkins’ employment was made before NAAJA had become aware that the originating application had been lodged in the Court.
PART 4: PLEADINGS
The issues are joined in the latest iterations of the pleadings, comprising Ms Atkins’ 2ASOC dated 17 September 2023, NAAJA’s Further Amended Defence dated 2 October 2023 (FAD), Ms Atkins’ Amended Reply dated 5 October 2023 (AR) and NAAJA’s Rejoinder dated 25 October 2023 (R).
Workplace rights
There is no dispute (and I find in any event) that Ms Atkins had workplace rights that she exercised (or proposed to exercise), specifically:
(1)by making the Complaint she exercised the right in s 341(1)(c) of the FW Act to make a complaint or inquiry in relation to her employment;
(2)by lodging the initiating documents in this proceeding on 20 February 2023 and providing those documents to NAAJA’s lawyers, she exercised the right in s 341(b) to initiate and participate in a proceeding under a workplace law; and
(3)by threatening to commence legal action, including claims for urgent relief, she proposed to exercise the Proceedings Right.
It is necessary to make a further observation about Ms Atkins’ exercise of the Complaint Right. The allegation that she in fact exercised each of the workplace rights as defined in s 341 of the FW Act is admitted by NAAJA. That admission encompasses the circumstance that the Complaint was made bona fide and that it was one that was properly directed to its recipients, specifically with the intention that it be brought to the attention of the Board. In addition, the Complaint was in the nature of an inquiry in relation to Ms Atkins’ employment because it expressly sought the advice of the Board as to what should be done in relation to the subject matter raised in it. NAAJA’s admission that the Complaint was one that Ms Atkins was able to make in relation to her employment is consistent with the objective facts about the role of the Board, including its role in managing risks and in dealing with conflicts not only between NAAJA and other entities, but within NAAJA itself.
Adverse actions
Ms Atkins relies on five actions each of which is alleged to fall within the definition of “adverse action” in s 342 of the FW Act. I will refer to them by the same definitions employed in the pleadings (omitting the word “adverse” in connection with them).
The Suspension Action comprises action taken by NAAJA against Ms Atkins in:
(1)suspending Ms Atkins from the duties of her employment;
(2)alleging that she had engaged in impropriety in connection with the application of Ms Rosas’ signature on the Contract Extension Letter;
(3)directing that she not attend for or perform work; and
(4)informing her that her access to NAAJA’s IT systems had been suspended.
NAAJA admits that the Suspension Action was “adverse” because it prejudicially altered Ms Atkins position in her employment by making her employment less secure, denied her access to the workplace and the benefits of that access, preventing her from performing the duties of the employment and exercising her skills and responsibilities as CEO, humiliating her and subjecting her to distress and psychological injury: 2ASOC, [20]; FAD, [20]. NAAJA denies that doing those things had the additional consequence of subjecting Ms Atkins to treatment that was substantially different to the way in which she was ordinarily treated in the employment: 2ASOC, [19]; FAD, [19]. I do not understand the basis for that denial. The factual consequences of the action were seismic shifts in the manner in which Ms Atkins had previously been treated in her employment. She had not ordinarily been subjected to allegations having no proper basis (as to which see below), nor had she been shut out of her workplace, prevented from doing her duties or prevented from accessing NAJAA’s IT systems. I am satisfied that the Suspension Action can be characterised in the additional manner pleaded and so fall within the alternate limb of the definition.
Ms Atkins further alleges that the Suspension Action was an adverse action for the additional reason that it discriminated adversely between NAAJA employees, namely between her and Ms Evans: 2ASOC, [21]; FAD, [21]. That disputed issue is resolved elsewhere in these reasons.
The Review Action comprises NAAJA’s conduct in engaging BDO “to discover evidence” about whether Ms Atkins had engaged in irregular, inappropriate or criminal activity: 2ASOC, [28A(a)]. There are disputes as to whether NAAJA took the Review Action other than in good faith and on a proper basis and thereby injured Ms Atkins in her employment and as to whether, in taking the Review Action, NAAJA discriminated between Ms Atkins and Ms Evans: 2ASOC, [28B], [28D]; FAD, [28B], [28D].
The Review Reliance Action comprises NAAJA’s conduct in adopting the conclusions, opinions or recommendations in the BDO Report in deciding (whether by valid resolution or otherwise) to terminate Ms Atkins’ employment and reporting her to the police. NAAJA admits that the Review Reliance Action altered Ms Atkins’ position in the employment to her prejudice: 2ASOC, [28E]; FAD, [28E]. There is a dispute as to whether the action was adverse for the additional reason that it discriminated between Ms Atkins and Ms Evans: 2ASOC, [28D]; FAD, [28D].
The Misconduct Action comprises NAAJA’s conduct in sending the Allegations Letter to Ms Atkins on 19 January 2023. There is a dispute as to whether the conduct was adverse in that it injured Ms Atkins in the employment, and as to whether it altered her position in the employment to her prejudice, or involved a threat to do so: 2ASOC, [25], [26]; FAD, [25], [26].
As mentioned earlier in these reasons, there is a dispute as to whether NAAJA has terminated the employment relationship. Ms Atkins’ written closing submissions make repeated reference to there being an onus on NAAJA to prove that the termination of the employment relationship was legally effective. I do not accept that submission. The onus of proof in all respects is on Ms Atkins, except to the extent that s 361 of the FW Act provides otherwise. Section 361 does not operate to reverse any onus of proof concerning proof of whether an action was taken or proof that the action was adverse.
The case alleging a contravention of s 340 of the FW Act proceeds on alternate basis that Ms Atkins has either been purportedly dismissed or actually dismissed, each scenario alleged to involve an adverse action. The relevant action is NAAJA’s conduct in sending the Termination Letter to Ms Atkins on 20 February 2023 following the February Meeting. It is convenient to refer to that conduct as the Dismissal Action irrespective of whether the employment relationship has been validly terminated. NAAJA’s position is that the employment relationship was terminated and it is on that basis that it admits that the action was adverse: 2ASOC, [32]; FAD, [32]. It disputes that a purported dismissal could constitute an adverse action. It is necessary to resolve that dispute because the assessment of any remedy will depend in part on a proper identification of the manner and extent to which Ms Atkins has been prejudiced in her employment.
If there has been a purported dismissal, I would have no difficulty concluding that the conduct of an employer in purporting to dismiss an employee is adverse action for the reasons alleged by Ms Atkins (at 2ASOC, [31]), specifically because it made her employment less secure (by denying the existence of the employment relationship) and because it deprived Ms Atkins of the opportunity for the Board to consider her response to the Allegations Letter (as later revised).
The several aspects of the dispute about whether there has been a dismissal or purported dismissal will be summarised in Part 9 below.
NAAJA’s reasons for taking the actions
The starting presumption is that the adverse actions were taken because of the reasons alleged by Ms Atkins in the 2ASOC. The allegations (and hence the presumptions) are that the:
(1)Suspension Action, Review Action, Review Reliance Action, and the Misconduct Action were each taken because Ms Atkins had exercised the Complaint Right: 2ASOC, [22], [27], [28F]; and
(2)Dismissal Action was taken because Ms Atkins had exercised the Complaint Right, or because she had exercised (or had proposed to exercise) the Proceedings Right, or in order to prevent Ms Atkins from exercising the Proceedings Right: 2ASOC, [33].
That conclusion is reinforced by the distance between the subjective views asserted by the witnesses and the objective facts of what was contained in Ms Atkins’ response. By way of example, as mentioned above, directors at the January Meeting were said to have acted on the BDO Report, which included a “finding” that there were 61 instances of Ms Atkins’ incurring personal expenditure on her corporate credit card. Only three of those transactions were given expression in the Allegations Letter. There is no explanation in the evidence for the apparent abandonment of 58 of them. Two of the surviving transactions related to art supplies. Ms Atkins’ response was that the expense related to art that remained on display in NAAJA’s Palmerston and Darwin Offices. She said that she needed to access the computer that had been seized from her in order to respond to the last remaining allegation.
Furthermore, as I have already identified, the content of Mr Rossingh’s memo objectively speaking was highly relevant, given the discussion that occurred at the January Meeting about Ms Atkins’ involvement in the Vehicle Scheme. Other aspects of Ms Atkins response were obviously matters that, if considered by the Board, might cause it to question whether the termination of Ms Atkins was warranted.
The witnesses’ asserted belief that Ms Atkins response was nothing but lies and deception is difficult to accept given the content of the allegations and the content of Ms Atkins’ response. I find it implausible that the directors had genuinely formed the view that the response did not warrant consideration by the Board given the objective circumstances I have described. The more likely explanation for their decisions is that they did not want to the Board to consider the response because they appreciated the likelihood that the Board may reconsider the Termination Resolution. Their conduct is also consistent with a desire to notify Ms Atkins of her dismissal with the utmost haste.
In light of the evidence as a whole I do not accept the denials of Ms Rosas, Ms Ellis or Ms Moore that they were not motivated either by the Complaint or by the fact that Ms Atkins had threatened legal proceedings to prevent the termination of her employment. The better view is that they acted in haste because they understood the threatened legal proceeding to be imminent.
The evidence of the directors who attended the February Meeting lacked the nuance to be expected of directors who had truly engaged with the matters raised in Ms Atkins’ response to the allegations or given any serious consideration to the question of whether the Board should be apprised of the information contained in it. That lack of engagement, together with the sense of urgency attending the decision give rise to real questions as to their motivations. In my view, the inference arises that none of those in attendance wanted the complication of a Board meeting at which the Termination Resolution might be reconsidered. Their conduct in relying on the earlier Termination Resolution knowing that the Board had not been apprised of Ms Atkins’ position and not informing the Board is highly unusual behaviour, especially given the assurances made to Ms Atkins in the Allegations Letter itself. Absent a cogent explanation, the inference arises that the decision-makers at the February Meeting were motivated by a prohibited reason and not by the reasons given in their evidence. It is enough to say that NAAJA has not proved otherwise.
I am satisfied that the fact that this proceeding had been commenced and an unsealed copy of the originating application served on NAAJA’s lawyers was not disclosed to the directors in attendance at the February Meeting until after they had communicated their decision that a letter be sent to Ms Atkins notifying her of the termination of her employment. Accordingly, those who made the decision were unaware that Ms Atkins had in fact lodged an application for an injunction in this Court at the time that their decision was made. However, little turns on that because NAAJA has not established that they were not aware of correspondence previously sent by Ms Atkins’ lawyers making it plain that a proceeding would be commenced without notice unless undertakings not to terminate the employment were given. None of them denied knowledge of that earlier threat.
The role of Mr Kellock, Mr Brown and Mr Taziwa
Ms Atkins’ closing submissions were to the effect that Mr Kellock’s knowledge of the commencement of this proceeding can be attributed to NAAJA under ordinary principles of agency and that he may have been a “decision-maker” or “influenced the decision”. Unlike the evidence disclosing the involvement of Ms Evans, I do not consider there to be any proper basis to suppose that Mr Kellock influenced the decision made at the February Meeting or any other adverse action. The invocation of agency principles in this context does not assist Ms Atkins. The focus of the Court is on whether the NAAJA decision-makers at the February Meeting were aware that this proceeding had been commenced. It is wrong to attribute Mr Kellock’s knowledge of this proceeding to each of those decision-makers.
Ms Atkins also submitted that Mr Brown “may have been a decision maker or have influenced decision making in respect of the Review Action”. There is evidence that Mr Brown may have been closely involved in the engagement of BDO, the preparation of the Terms and the provision of information to BDO. NAAJA’s failure to call him has the ordinary forensic consequence that he did not provide the Court with any explanation to rebut inferences about Ms Evans’ involvement, nor did he assist NAAJA to explain who decided on the content of the Terms. It is not necessary to label him as a “decision-maker” in order for those consequences to follow.
The same may be said of Mr Taziwa. He is an obvious witness who had knowledge of matters requiring an explanation, specifically in connection with his dealings with Ms Evans and the identity of persons who provided him with documents (or did not provide him with documents as the case may be). Like all litigants, NAAJA made choices about the presentation of its case. Its approach was to simply ignore the inferences that could be drawn from the documents that evidenced Ms Evans’ involvement in the process culminating in (at least) the BDO Report, rather than positively grappling with their implications or adducing evidence to put a different complexion on them. Given her connection with the Complaint and her motivations as I have found them, that is highly unusual. The consequence of the choice not to call Ms Evans or Mr Taziwa is that the Court cannot be satisfied of NAAJA’s pleaded case because there is a body of unexplained evidence that significantly detracts from it. It is not necessary to categorise either Ms Evans or Mr Taziwa as a “decision-maker” to reach that conclusion.
Alleged Board consideration of Ms Evans’ response to the Complaint
NAAJA’s case was that the Board resolved not to do anything further about the allegations made against Ms Evans in the Complaint after the considering her response and satisfying itself that the matters raised in it were “operational in nature”. I accept that is the impression conveyed in Mr Brown’s letter to Ms Evans of 30 January 2023. However, I do not consider that letter to be a reliable business record, at least for the purpose of proving the truth of the matters sated in it.
On the material before me, it has not been demonstrated that all directors considered Ms Evans response and formed a joint view about it, whether at a meeting or at all. Several directors said that they had not been made aware of Ms Evans’ response at all. They include Mr McLennan, Mr Hill and Ms Assan. That is a further example of NAAJA witnesses and lawyers using the word “Board” too loosely in order to suggest that collective decisions had been made when the objective evidence does not demonstrate that any such thing occurred.
I am not satisfied that Ms Evans’ response to the Complaint had been resolved at the level of the Board at any time before the January Meeting or the February Meeting. The evidence supports a finding that the Board had done nothing to address some of the allegations made in the Complaint. They include an allegation that Ms Evans made an offer on a property at Tenant Creek and an allegation that she had caused NAAJA to procure a large quantity of laptop computers but had refused to produce them or disclose their whereabouts to Ms Atkins when directed to do so. The adjective “operational” was used by nearly all of the NAAJA’s directors in connection with the matters raised in the Complaint. To describe the matters as “operational” says nothing about gravity of the issues that had been raised.
NAAJA also submitted that at the time that the adverse actions were taken the fact and subject matter of the Complaint was of no ongoing significance to the Board. That broad submission is not supported by the evidence. Several directors said that the topic of the Complaint was raised at the January Meeting. In cross-examination, several directors acknowledged that they held adverse views about Ms Atkins relating to the Complaint which they held at the time of later adverse actions. The content and relevance of those views is discussed below.
The “spirit” of the Vehicle Scheme
Counsel for NAAJA submitted that some of the adverse actions should be understood as having been taken because Ms Atkins acted outside of the “spirit” of the Vehicle Scheme because she acquired so many vehicles under it. That submission does not accord with the evidence of the directors’ understanding of what Ms Atkins had done nor does it accord with the “findings” in the BDO Report upon which they said they relied. The directors’ testimony variously disclosed beliefs and understandings that Ms Atkins had some role to play in a scheme that was not authorised by the Board or that she had otherwise breached the rules of the Scheme or that she had simply used NAAJA funds to buy vehicles for herself.
I do not accept the evidence of Ms Rosas or the evidence of Ms Ellis insofar as they expressed a sense of dismay or disgust about the number of vehicles nor their asserted belief that the number of vehicles had not previously been disclosed. Ms Ellis acknowledged that she had told other directors that Ms Atkins had purchased vehicles (plural) using NAAJA funds. I have already mentioned that Ms Atkins paid more than $40,000 to NAAJA to ensure that any FBT implications arising from her involvement in the Scheme was not a cost borne by NAAJA itself, as well as the other objective circumstances referred to in Mr Rossingh’s memo and minutes of the 2015 meeting. In light of that material and my impressions of the witnesses more generally, I consider that the testimony of Ms Rosas and Ms Ellis on the topic of the Vehicle Scheme was so disconnected from the objective facts known to them, that I cannot accept their asserted sense of outrage to be genuine.
Disparity in treatment
On the facts I have described there was a disparity of treatment between Ms Evans and Ms Atkins both of whom faced allegations of serious misconduct. One of them was kept under suspension in her employment and became the subject of an external “investigation”, the other was not only retained in her employment but permitted to participate in processes leading to the dismissal of the other.
One was immediately afforded natural justice, the other was not. One was privy to communications about matters affecting the security of employment of her adversary, the other was not.
I am satisfied that the actions involved discrimination between employees that has not been adequately explained and that the actions were therefore “adverse actions” as defined in the FW Act.
Performance and the KPMG Report
NAAJA’s written closing submissions began with an assertion that this proceeding “bears witness to a complex and bitter relationship breakdown between a long-standing chief executive officer and the governing Board of a publicly-funded employer”, together with an assertion that the asserted relationship breakdown was not “actuated” by the Complaint. On the topic of Ms Atkins’ performance, NAAJA placed heavy reliance on the KPMG Report to support submissions that the timing of the adverse actions relative to the Complaint was merely coincidental. Particular reliance was placed on its conclusion that “the CEO has resumed responsibility for the administrative operation of the Board, including meeting scheduling, meeting organisation, board paper coordination and distribution, logistics, agenda setting, and minute taking and distribution” and that “[t]his has resulted in significant friction and erosion of trust between the Board and the CEO, and the Board believing they do not have adequate oversight or control of the organisation or the CEO”.
The quoted passages are to be considered in their proper context. The KPMG Report explains the Board’s belief in terms of its own failure to understand its role and authority and a further failure to identify and articulate the CEO’s role and responsibilities. It made no finding that the issue was in any way the fault of Ms Atkins or that the issue adversely reflected on her performance or competency.
It is to be recalled that the decision to engage KPMG was made in mid 2022, that its review was carried out in October and November 2022, that there was a preliminary presentation to the Board at the First November Meeting and that KPMG delivered its draft report to Ms Rosas on 5 December 2022. I accept those dates are contemporaneous with other critical events relating to the Complaint and the adverse actions.
However, I approach allegations concerning Ms Atkins’ performance with considerable caution. Whilst performance issues are raised in NAAJA’s evidence and submissions, NAAJA’s pleading does not allege that performance issues formed any part of its reasons for taking the adverse actions: see [169] above. I will nonetheless explain why I do not accept NAAJA’s submissions in relation to the significance of the KPMG Report in any event.
It is recalled that KPMG consulted only with those directors who self-nominated for interview. Only three directors self-nominated: Ms Rosas, Ms Ellis and Ms Moore. None of them disclosed precisely when they spoke to the consultants nor about what they said nor about any materials they provided in support. It is reasonable to infer that the “findings” in the KPMG Report upon which NAAJA places reliance were based on the self-reporting of one those three directors and not upon any wider enquiry.
There are testimonial assertions of some directors to the effect that they were not impressed with the way in which Ms Atkins performed some of her duties in the past particularly in connection with the running of Board meetings. However, assuming those expressions were genuine there is nothing at all to indicate that any such thoughts were outwardly expressed to Ms Atkins whether formally or informally or that they were ever the subject of any consideration or proposed action by the Board. The evidence of Ms Ellis is illustrative. In her affidavit she expressed frustration that Ms Atkins had not organised an independent scribe to take the minutes of Board meetings. However, in cross-examination she acknowledged that by the time of the First November Meeting that issue had been resolved and so was more in the nature of an historical grievance. She did not suggest that the issue relating to the scribe was anything other than a source of irritation. She also included in her affidavit an allegation that Ms Atkins “controlled the correspondence between NAAJA and regulatory bodies” without elaboration as to why she perceived that to be a negative thing and why the Board could not readily have assumed control of that correspondence if it was at all concerned about it.
Similarly, Ms Rosas complained that Ms Atkins controlled NAAJA’s dealings with governing bodies such as ASIC, and yet other uncontested evidence showed that Ms Rosas as Chairperson had the password to access and amend NAAJA’s records with ASIC, and that Ms Atkins did not. It is unclear why Ms Rosas thought it inappropriate that the CEO of NAAJA correspond with ASIC about its corporate affairs in any event. There is no evidence that those directors or the Board more generally had formed a desire to dismiss or even discipline Ms Atkins on the basis of those past complaints.
On the same topic, one of the first issues mentioned in the closing submissions is a “perception that [Ms Atkins] dictated the extent of the Board’s role within, and its oversight of, the organisation and unduly controlled the Board’s access to information”. That perception was one asserted by Ms Rosas, but no other director gave evidence about it. Ms Rosas went so far as to suggest in a generalised way that the Board did not have access to information crucial to NAAJA’s financial governance. I cannot accept those assertions as well-founded or genuine. There are no contemporaneous records in evidence giving expression to such concerns. Ms Rosas complained that Ms Atkins wrote the agenda for Board meetings, but did not explain why that was at all unusual, nor did she go so far as to say that the Board could not add any matter to the agenda that its directors saw fit to add, as demonstrated by Ms Rosas taking control of the agenda for the First November Meeting. The evidence as a whole reveals that directors were free to raise whatever matters they wished, including about Ms Atkins herself. In addition, the business records in evidence show that there were financial advisory and remuneration subcommittees, the membership of which was entirely under the Board’s control, and there is no suggestion that NAAJA’s financial accounts were put beyond the reach of those committees or out of reach of the Board more generally.
I have earlier observed that Ms Atkins’ most recent performance review of October 2022 was not complete, however there is nothing to indicate that any issues concerning Ms Atkins’ competency were raised at the performance review interview and nothing to suggest that any director brought to Ms Atkins’ attention any concerns about her competency in the context of any earlier performance review.
In closing submissions NAAJA invited the Court to find that at the First November Meeting KPMG presented “findings” equivalent to those contained in a later draft report “including that the CEO’s performance was not adequately reviewed or managed” and that from the time of that meeting the Board was “grappling with” those findings. That submission overstates the evidence as to what was known and what occurred at the First November Meeting. None of the directors who attended the meeting said that KPMG specifically reported anything about Ms Atkins’ performance, nor that the attendees “grappled with” any particular finding in the KPMG Report at that time. The evidence is insufficient to support a finding that the KPMG Report itself was presented to the Board at that time. In her affidavit Ms Rosas said that she received a draft report from KMPG on 5 December 2022, after Ms Atkins had been suspended from her employment.
Viewed objectively, the KPMG Report reflects more poorly on the Board than it does on the CEO. The recommendations were that NAAJA review, define and document the CEO’s key roles and responsibilities in line with the growth of NAAJA’s operations, to communicate that role description to at least the senior management team, to formally define her key performance indicators to develop and implement a plan to transfer her “institutional knowledge and excess duties” to other personnel. KPMG concluded that Ms Atkins had a workload that could not be managed by a single person. It concluded that the Board had not adequately understood its institutional role and power to review and manage the CEO’s performance. It recommended a period of “intensive capability uplift” followed by regular governance training.
In the circumstances I have described, I do not accept Ms Rosas’ affidavit evidence that the KPMG Report was a reason for her taking any of the adverse actions against Ms Atkins. NAAJA’s submissions sought to elevate the significance of the KPMG Report beyond anything expressed in the pleadings and in a way that did not fairly reflect the evidence given by its directors on the topic.
In addition, I do not place weight on the KPMG Report to the extent that it was relied upon as evidence of a prior consistent statement made by any particular witness, given the mystery as to who said what to KPMG, when they did so and why they did so.
Other issues relating to Ms Atkins’ performance
A common theme emerging from the cross-examination of NAAJA’s witnesses was their stated view that the Complaint reflected poorly on Ms Atkins’ supervisory abilities, specifically her ability to resolve issues within her sphere of responsibilities before they got of hand. Some directors said that Ms Atkins ought to have invoked NAAJA’s grievance policy. Others said that the manner in which she had articulated herself in the Complaint lacked professionalism. Others referred to her failure to provide supporting evidence. As I have mentioned, nearly all of the directors described the issues raised in the Complaint as “operational”. They expressed the view that it did not form a part of the Board’s role to deal with them. I am satisfied that several witnesses held those views not only at the time that the Complaint was made but that it was persisted with through to the time of the Termination Resolution and (for those who participated) through to the decision to send the Termination letter. I am satisfied that those views formed a part of their reasons for participating in those actions and reject the evidence of those who denied that was so.
Ms Atkins submitted that those revelations in the evidence were sufficient to support a finding that the adverse actions were taken “because” of the Complaint within the meaning of s 340 of the FW Act. It was enough, she submitted, that the directors were critical of her for making the Complaint and that their critical views were one of the operating factors in their minds at the time of the adverse actions.
Ms Atkins’ submissions on that topic were not entirely correct as a matter of legal principle. It is not enough to demonstrate that the Complaint caused a director to form an adverse view about Ms Atkins. That is because an adverse view of an employer may be formed in a way that is connected in some way with the exercise of an employee’s workplace right, but without a contravention of s 340 of the FW Act occurring: BHP Coal. It is necessary to closely discern the reasons why each director formed his or her critical view. In doing so, the directors may be considered in three classes (although some may fall within more than one).
In the first class are those directors who considered that matters raised in the Complaint (even if true) showed a failure on Ms Atkins’ part to adequately manage those under her supervision so as to prevent the events she complained of occurring. An adverse view held on that basis could not be said to be one that was formed “because” Ms Atkins had exercised her workplace right by making the Complaint. As the High Court emphasised in BHP Coal it is not sufficient to show that there is a factual connection of any kind between the adverse action and the workplace right. To the extent that a director joined in an adverse action because he or she rightly or wrongly formed the view that Ms Atkins was an ineffective CEO by failing to prevent the events raised in the Complaint from occurring, that does not establish a contravention of s 340 of the FW Act. The correct analysis is that the Complaint happened to be the mode by which issues perceived to reflect poorly on Ms Atkins’ performance happened to come to the directors’ attention.
In the second class are those directors who formed a critical view of Ms Atkins because of the manner in which she had expressed herself in the Complaint. That includes views that Ms Atkins was unprofessional in her language, in her use of dot points, in her failure to set out a detailed factual foundation or in her failure to provide supporting documents in relation to the matters she had raised. To the extent that those adverse views formed a part of the reasons for taking the adverse actions, that does not establish a contravention of s 340 of the Act. In such cases, it may be said that the adverse action was taken not because of the particular exercise of the particular workplace right, but rather because in the course of exercising the right, an employee displayed characteristics that the decision-maker considered to reflect poorly on the person’s competence.
In the third class are those directors who were annoyed by the fact of the Complaint because it raised matters that they believed should not have come to the Board’s attention because they were not matters falling within the Board’s sphere or responsibilities. I include in this class those directors who asserted that Ms Atkins ought to have invoked a “grievance” policy, those who said that the issues were “petty” and those who used the adjective “operational” without any meaningful elaboration as to what they meant by that word. Most of the directors fall within this class.
In relation to the “grievance” policy, there is no such document in evidence and the witnesses who referred to it (particularly Ms Ellis) did not explain how she could conceivably have formed any reasonable view that a “grievance” policy was the only available or appropriate procedure for the matters to be addressed. I am not prepared to draw any inference that the policy was either available or appropriate to deal with the serious subject matter the CEO had raised against its CFO. This was not a matter of one employee complaining that another had taken his or her yoghurt from the common fridge. As discussed elsewhere in these reasons, the Complaint raised serious issues of financial impropriety and disclosed Ms Atkins’ unsuccessful attempts to resolve them directly with Ms Evans. I formed the view that Ms Ellis’ evidence that the grievance policy should have been used to be just another way of saying that Ms Atkins should be criticised for bringing her concerns to the Board’s attention and for asking the Board to advise what should be done.
The directors in this class formed critical views about Ms Atkins because of an objectively wrong belief that she should not draw the Board’s attention to the issues about which she complained and should not ask for the Board’s guidance about them. To the extent that the directors held that adverse view, it was a view founded in a sense of frustration that the Board was being put to a burdensome task that was not within its remit. In my view several directors can be identified as forming adverse views about Ms Atkins substantially for that reason, accepting that adverse views of the other kinds I have mentioned may also have been held by them. Speaking in the abstract, if the adverse views of an employer falling within this class factor into an impugned decision in a material way, the causal element of a contravention in s 340 of the FW Act would be satisfied: the adverse action could be said to have been taken “because” of the employee’s exercise of the workplace right in the requisite sense. Given the manner in which the evidence transpired, NAAJA’s onus in the present case included the necessity to show that the adverse views falling within this class did not form a substantial and operating factor of the reasons for taking the adverse actions against Ms Atkins. I am not satisfied that NAAJA’s onus is discharged in that discrete respect.
PART 12: NEXT STEPS
My conclusion on the question of liability is that NAAJA is liable for each of the contraventions of s 340 of the FW Act as alleged by Ms Atkins.
There will be case management orders progressing the question of remedies to a final hearing. I do not propose to make any substantive declarations of contravention without first hearing from the parties as to the form they should take. My conclusions with respect to the employment contract should not be understood to include any conclusion as to whether Ms Atkins is entitled to orders for specific performance or injunctions in the form she has sought. All that will be determined after the next stage of the trial.
I certify that the preceding seven hundred and eighty-nine (789) numbered paragraphs are a true copy of the Reasons for Judgment of the Honourable Justice Charlesworth. Associate:
Dated: 27 June 2024
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