Brendan James Tobin v Westpac Banking Corporation

[2010] FWA 9291

Note: An appeal pursuant to s.604 (C2011/2545) was lodged against this decision - refer to Full Bench decision dated 24 May 2011 [[2011] FWAFB 2144] for result of appeal.

[2010] FWA 9291

FAIR WORK AUSTRALIA

DECISION

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

Brendan James Tobin
v
Westpac Banking Corporation
(U2010/8948)

COMMISSIONER RAFFAELLI SYDNEY, 20 DECEMBER 2010

Termination of employment - termination of senior manager - alleged misleading his manager.

[1] This is an application by Mr Brendan Tobin (the Applicant), who seeks an unfair dismissal remedy in respect of his termination by his former employer, Westpac Banking Corporation (the Respondent).

[2] It is not in dispute that the Applicant has been dismissed, that the Respondent is not affected by the Small Business Unfair Dismissal Code and that the dismissal was not a case of genuine redundancy. The only issue is whether the dismissal was harsh, unjust or unreasonable.

[3] At the time of his termination, the Applicant was the head of general insurance of the Respondent. He had commenced employment with the Respondent on 26 May 2008. He reported to Mr Mark Smith, General Manager for Insurance, who in turn reported to Mr Brad Cooper, the Chief Executive Officer of BT Financial Group, part of Westpac Banking Corporation.

[4] As head of general insurance, he led a team of six direct report senior managers and a total of one hundred and fifty five people in the general insurance section.

[5] According to the Applicant, on 15 March 2010, he had a regular scheduled meeting with Mr Smith. When entering the meeting, he was informed by Mr Smith that the agenda was changing. Mr Smith indicated that he wanted to discuss the Applicant’s performance and expressed concern with the Applicant’s leadership style. He gave evidence that Mr Smith told him he was going to “exit the Applicant from the business”. He had a choice to resign or to be terminated.

[6] The evidence of Mr Smith was not to fully agree with the Applicant as to the words allegedly used at that meeting. He did not however dispute that he had raised concerns with the Applicant and made it clear that there were matters which threatened the Applicant’s ongoing employment.

[7] Whatever version of events is to be accepted as to the meeting of 15 March 2010, it is clear that the Applicant was under clear notice that his supervisor was unhappy with some of his performance or conduct and saw the possible option of his termination.

[8] The Applicant complained concerning Mr Smith’s conduct at the meeting, including that he felt he had been bullied and harassed. Soon after, the Respondent took steps to ensure that Mr Smith was no longer to be involved in the Respondent’s investigation of the Applicant’s conduct and/or performance.

[9] The matter concerning the Applicant’s performance and conduct was left to be investigated by Ms Simone Hart and the final decision was made by Mr Cooper.

[10] On 5 May 2010, Mr Cooper wrote to the Applicant and informed him that his employment had been terminated. Relevant extracts from the correspondence include as follows:

“As you know, we have conducted an investigation into allegations of misconduct made against you by several members of your team and your manager.

We set out below the findings of our investigation.

Allegation 1 - you exhibited unacceptable and unprofessional behaviour during a Claims meeting on 12 March 2010

The investigation found this allegation to be substantiated, in that it was concluded that you demonstrated poor leadership and judgment at the meeting in question.

...

Allegation 2 - you demonstrated poor judgment by requesting that the Ernst & Young consultant Ms Shelley Broxom ‘make herself absent’ during an APRA review on 3 and 4 March 2010 and by your conduct risked Westpac’s reputation and relationship with its regulator.

The investigation found this allegation to be substantiated. This finding is based on the following:

• A decision had been made by the Risk and Regulatory team in consultation with you that it would not be appropriate for Ms Broxom to present at the APRA review for reasons including that she was a contractor and not an employee of Westpac.

In light of this decision in the early evening of 3 March 2010, you had a meeting with Ms Broxom at which you:

• informed her that you had told APRA that she was not available on 3 and 4 March due to personal reasons. Given that Ms Broxom and you were at the office on the evening of 3 March, the investigation concluded that you have either lied to APRA or directed one of your team members to lie about being absent from the office on a day (3 March) when she was in fact in the office; and

• instructed Ms Broxom to be out of the office on 4 March 2010. At no stage had you been directed to instruct Ms Broxom to be absent from the office on 4 March 2010, nor was it necessary for her to be absent from the office in order for her not to present to APRA. The investigation rejected your assertion that Ms Broxom might otherwise have been contacted directly by APRA.

As a consequence, your statement to Mark Smith on 15 March 2010, that the Risk & Compliance team told you to ‘ensure she [Ms Broxom] was not in the office on day 2 of the review’ was untrue.

Further, it was your direction to Ms Broxom to be out of the office on 4 March 2010 which led her to send an inappropriate email to a number of your direct reports on 3 March 2010 in relation to her absence for the office as follows:

‘They [APRA] apparently have been given the excuse that I had a pre-arranged personal matter that I needed to deal with for these 2 days, please make sure that none of the staff contradict this and let on that I was here today.’

You were aware this email had been sent. At no time have you acknowledged that such an email clearly did not present a professional or ethical position to more junior employees reporting to you and also had the potential to damage Westpac’s reputation and its relationship with regulators.

Allegation 3 - you falsely advised your manager Mr Mark Smith that all employee scorecards had been signed off

The investigation found this allegation to be substantiated, for the following reasons:

• You were clearly aware that the scorecards were to be completed and signed off by 30 November 2009.

• You informed Mr Smith in your weekly email update on 22 October 2009 that ‘FY10 scorecards all written’. By ‘written’ you could only have meant that the scorecards had been discussed and agreed with all employees. Given the process involved in completing a scorecard, the word ‘written’ could not reasonably have any other meaning.

• On the afternoon of 15 March 2009 you informed Mr Smith that all scorecards had been completed and signed off.

• When later on 15 March 2009 Mr Smith raised a query in relation to the scorecards, you stated to him by email that his was the first that you had heard that all scorecards may not have been completed and signed off.

• Three of you direct reports (Ms Broxom, Ms Poxleitner and Ms Gladman) informed the investigation that, as at that time, their scorecards had not been completed (in the sense of having been discussed and agreed), and therefore had not been signed off. Each of these persons stated to the investigation that they had made numerous attempts to meet with you since December 2009 in order to discuss their scorecard.

Termination of Employment

Westpac is greatly concerned at the findings which have been made in relation to allegations 2 and 3:

• the misrepresentation you made to Mr Smith about the status of the scorecards (as set out above under allegation 3), call into question you honesty and integrity; and

• your conduct in lying to APRA and/or directing Ms Broxom to lie about her attendance in the office (as set out above under allegation 2) compromised the integrity of a colleague and put at risk Westpac’s reputation and relationship with APRA.

Integrity is one these core values that your employment contract requires you to observe. It is also the cardinal principle in the Westpac Group Code of Conduct (which states that ‘Westpac does not tolerate dishonest behaviour by our colleagues’).

It appears that on a total of four occasions you have deliberately lied to, and knowingly misled, your manager, i.e. reporting the status of the scorecards and Ms Broxom’s absence from the office on 4 March 2010.

You have also lied to APRA, and have directed Ms Broxom to participate in your lie to APRA, concerning the reason for her non attendance in the office during the APRA Review.

Your dishonesty goes to the very heart of your employment relationship with Westpac. It is absolutely essential to the proper discharge of your responsibilities that your manager should be able to rely implicitly on everything that you report to him and trust without question everything that you say to him.

For the reasons identified by the investigation, this relationship of trust and confidence has broken down irretrievably.

In addition your dishonesty has been communicated to members of your extended Insurance team and not denied by you. Staff members have witnessed the example of a senior Westpac manager conspiring to mislead the regulator. Obviously, this will also impact negatively on your ability to lead, and command the respect of, those who report to you.

In our view it is no longer possible for you to continue to work as a manger at Westpac and your employment will be terminated with effect from Wednesday 5th May 2010.”

[11] Section 387 of the Fair Work Act 2009 (the Act) sets out the criteria for considering whether termination has been harsh, unjust or unreasonable. The first matter to take into account is whether there was a valid reason for the dismissal related to capacity or conduct.

[12] In that regard, I note that the Respondent’s greater concern at the findings made by the investigator related to allegations concerning the APRA review and the issue of scorecards. I propose to focus on those two findings made by the Respondent.

[13] According to the evidence of the Applicant, Westpac General Insurance is an APRA regulated entity. APRA conducts regular prudential reviews of companies. A component of such review is a two day on-site visit by APRA, at which members of management and support teams present to APRA.

[14] APRA was scheduled to attend Westpac General Insurance on-site on 3 and 4 March 2010. These presentations were preceded by “dry-run” rehearsals, coordinated by the Respondent’s regulatory affairs and risk compliance managers. One of the Applicant’s managers) was Ms Shelley Broxom who was a consultant and acting in the role of Claims Manager while the incumbent was on leave. Following the “dry-run” presentation, the regulatory affairs manager informed the Applicant that Ms Broxom’s presentation style was too confrontational, creating a high likelihood of putting Westpac’s General Insurance’s relationship with APRA at risk. According to the Applicant, they informed him that Ms Broxom should not present or meet APRA.

[15] On 3 March 2010, Ms Broxom did not present to APRA and it seems, kept a low profile during APRA’s attendance. On the same day, the Applicant informed Ms Broxom that she could take the next day off to avoid any accidental meeting between herself and APRA.

[16] Ms Broxom then took steps to send an email to her direct reports. It said:

“I’m just being asked by Brendan to make myself absent on Thursday in case APRA come roaming around the floor, which we are expecting them to do. They apparently have been given the excuse that I had a pre-arranged personal matter that I needed to deal with these 2 days, please make sure that none of the staff contradict this and let on that I was here today.”

[17] According to the written evidence of the Applicant, the regulatory affairs manager advised him to exclude Ms Broxom from the APRA review, and he was not responsible for the inappropriate e-mail sent by Ms Broxom to her subordinates.

[18] There was no conspiracy or otherwise, to mislead the regulator. He merely carried out the advice from the Respondent’s specialist compliance section. According to the Applicant’s further evidence, he was advised by Ms Kokkalis of the regulatory affairs and risk compliance section that Ms Broxom’s presentation was far too confrontational. It was too risky putting her in front of APRA. He raised with Ms Kokkalis the question, given that Ms Broxom was the acting claims manager, what were they going to tell APRA? Ms Kokkalis responded that they could merely say that she was not available and the fact that she was a contractor made it more sensible for the Applicant to do the presentation himself.

[19] According to the evidence of Mr Smith, at the meeting of 15 March 2010, the Applicant had said, in respect of telling Ms Broxom to stay away from the office on 4 March 2010, that Ms Kokkalis and her colleague Ms Vanessa Plunkett had told him to do this.

[20] In his oral testimony, the Applicant agreed that he told Mr Smith on 15 March 2010 that he had been directed by the risk and compliance team to ensure that Ms Broxom was not in the office on the second day of the review.

[21] Further, in correspondence from his solicitors of 23 March 2010, it was said that at the 15 March 2010 meeting the Applicant had responded to Mr Smith and said:

“that the decision that Ms Broxom be absent from the APRA review was made by the risk management team and not Mr Tobin. And that Mr Tobin had acted on their advice. Mr Tobin asked Mr Smith to contact Ms Tommie Kokkalis, to confirm that this was the case. Mr Tobin also said that he was disappointed Mr Smith would jump to conclusions so readily without checking with others.” (Exhibit T1 page 102)

[22] In cross examination, he now recalled that was wrong (PN113). He agreed that it was he and he alone who directed Ms Broxom not to attend for work on the second day (PN195).

[23] In respect of the issue of the scorecards, it was not in dispute that the Respondent’s financial year runs from 1 October to 30 September. Employee performance is assessed in respect of that same period and, together with the performance of the business, that determines whether an employee receives a bonus in respect of that year and the level of the bonus.

[24] Employee performance is assessed against a scorecard of the KPI’s established early in the year for each employee. The scorecard outlines both the business needs and the individual employee’s needs to achieve growth of the business. The objectives identified in a scorecard act as a guide as to what is needed to do and achieve in order to perform the job the Respondent expects of an employee and to obtain a bonus.

[25] The Applicant denied that he falsely advised Mr Smith that all employee scorecards had been completed.

[26] According to his written evidence (Exhibit T1), on 19 January 2010 the Applicant wrote to all his direct reports where they were asked to provide him with information as to how they were performing against their scorecard for the current year. All of the employees responded to him.

[27] On 4 February 2010, the Applicant and some of his managers received an e-mail from Ms Simone Hart, informing them that scorecards were to be entered into People’s Express, an internal program. He took steps to forward that e-mail to persons, including Ms Broxom, who were not initially sent the request from Ms Hart. It was his evidence that from that time onwards, all his direct reports were aware of the need to load scorecards for their people and for themselves.

[28] The Applicant said that, at a management meeting held on 1 March 2010, at which his direct report managers were present, it was made clear that they all had to add their objectives concerning their scorecards into People’s Express. No one declared the scorecard was not completed. The Applicant referred to a document dated 1 March 2010 (page 274 of the attachments to Exhibit 1) where an item read:

“Everyone to add objectives into People’s Express - Brendan can then log in and view changes/updates, due ASAP.”

[29] At a meeting with his managers held on Monday 15 March 2010, Mr Michael Pugh gave a demonstration on how scorecards could be loaded onto People’s Express. It was his recollection that the managers acknowledge that they were aware of what had to be done with scorecards.

[30] It was the evidence of the Applicant that during all these discussions concerning scorecards and the loading of information onto People’s Express, no manager that reported to him ever indicated that their scorecards had not been agreed.

[31] All senior managers had been aware, at least since 4 February 2010 that their scorecards and those of their subordinates had to be loaded onto People’s Express. The meetings of 1 March and 15 March 2010 would have prompted them to speak up if they had any concerns or if any of them believed their scorecards had not been finalised. They needed to communicate such to him so that any issue could be resolved. None did so.

[32] In cross-examination, the Applicant said that as at 15 March 2010 his knowledge was that the scorecards for all his direct reports had been agreed. He said that Ms Broxom had told him that it was agreed. He considered this to be in either late 2009 or early 2010.

[33] He agreed that it was important that scorecards be agreed and signed off. (PN768)

[34] The Applicant agreed that he now knows that as at 15 March 2010 three of his direct report managers had said that their scorecards had not been agreed. However, none of them had told him either on 15 March, 1 March or 4 February 2010 that their scorecard was not agreed.

[35] It was his evidence that Ms Broxom, Ms Gladman and Ms Poxleitner had agreed on their scorecards in November 2009. (PN1059)

[36] In responding to witness evidence from the Respondent, the Applicant denied that Ms Poxleitner had ever expressed to him that she would not agree with the objectives and scorecards until the budget allocation had been addressed satisfactorily. Ms Poxleitner was aware of the direction from Ms Hart on 4 February 2010. The Applicant said he was not responsible for loading the scorecards onto People’s Express. He denied the evidence from Ms Broxom that she made it known to him that she did not agree to the scorecard. The Applicant assumed that Ms Broxom had complied with the request from Ms Hart. Ms Broxom did not inform him that she had not loaded her scorecard onto People’s Express or that she did not agree with her scorecard.

[37] In respect of the evidence of Mr Smith, the Applicant denied that he had said to him that all scorecards had been loaded onto People’s Express.

[38] The evidence of Ms Simone Hart was that the performance of employees is assessed in or around October each year and is measured against the objectives set out in their scorecards that relates to the preceding 12 month period.

[39] On 24 October 2009 she had sent an email to the Applicant and other heads of divisions to enquire as to the percentage of scorecards that had been completed to date. The Applicant did not respond. There was no requirement for the Applicant to provide her with a copy of the finalised scorecards for his direct reports. Until 15 March 2010 she was unaware of the status of the scorecard of the Applicant’s team.

[40] During her investigations into the Applicant’s conduct and performance, Ms Gladman, Ms Poxleitner and Ms Broxom informed her that they had not agreed as to their objectives and targets for their scorecards with the Applicant and that they had made repeated attempts to finalise their scorecards.

[41] Her evidence also explained that the People’s Express system allowed employees and people leaders to upload scorecards onto an online system.

[42] It was the evidence of Ms Poxleitner that she had raised concerns about the budget allocation with the Applicant. Later, the Applicant had provided draft scorecards to her. It was clear that the objectives identified in the scorecards required a significant increase in the budget allocated to her. There was a significant inconsistency between the objectives in the draft scorecards and the amount of money allocated to achieve these objectives. She had raised her concerns with the Applicant.

[43] It was her evidence that from November 2009 to March 2010 she and the Applicant had numerous discussions about the budget and the funding that would be needed to achieve the objectives identified in the draft scorecards.

[44] As at 15 March 2010 she was still waiting for the Applicant to confirm the budget allocation that her marketing section would receive. Since the issue of additional funding remained outstanding, the scorecard remained in draft form.

[45] It was also her evidence that late on the afternoon of 15 March 2010 she was present as the Applicant was sitting at his desk and saw that he was uploading onto People’s Express scorecards of his team. She asked what he was doing and he had replied that he was putting everyone’s scorecard onto the People’s Express. She indicated to him that she was concerned about putting her scorecard onto People’s Express when it was still not agreed.

[46] She denied that the Applicant had asked her to load her scorecard onto People’s Express.

[47] In her oral evidence Ms Poxleitner agreed that after her draft scorecard objectives were given to her in October/November 2009, they were never subsequently altered. She agreed that her real concern was the question of increasing funding to meet the objectives in the scorecard.

[48] At one point, she had made it clear to the Applicant that she was not going to sign off on her scorecards until she had the budget fixed. (PN2061)

[49] The evidence of Ms Broxom was that around early December 2009 the Applicant emailed her draft scorecards. This was followed by a one-on-one discussion about the draft scorecards sometime later in December 2009. Further discussions occurred in the early part of 2010.

[50] On 1 March 2010 she attended the senior management team meeting at which the Applicant was present. The minutes record that scorecards were discussed but she can not recall that the Applicant asked her to load her scorecard. If he had, she would not have agreed because at the time there were still a number of unresolved issues in respect of her targets.

[51] On 15 March 2010 she attended another senior management team meeting which was handed over to Mr Michael Pugh from the people team to explain the process of uploading scorecards onto People’s Express and to provide an online demonstration of the functions of People’s Express. There was no discussion about the content of the scorecards.

[52] Ms Broxom, in her oral examination said that following the draft scorecards given to her by the Applicant towards the end of 2009, there were subsequent drafts of the scorecards given to her. (PN2236)

[53] On around 5 March 2010 Mr Smith had asked her whether she had signed off on her scorecard. She informed him that she had not.

[54] It was the evidence of Mr Smith that the Applicant’s 2009 performance review had identified that a critical area on which he should focus in 2010 was the provision of clear guidance to his team members as to their targets and objectives and the way in which their performance was going to be assessed. The principal means by which the Applicant was required to do this was by preparing and discussing with each of his team members draft scorecards.

[55] He learnt from Ms Anna Gladman that as at 15 March 2010 her scorecard had not yet been agreed and finalised. This surprised him, because so much emphasis had been given to the scorecard process in the Applicant’s 2009 performance review. The Applicant had led him to believe that the scorecards of his team had already been finalised and now, six months into the financial year, the Applicant’s team did not know what they are expected to achieve.

[56] In the 2010 financial year, the scorecard process was supposed to be completed with scorecards agreed and finalised by 30 November 2009 at the very latest.

[57] On 22 October 2009 he received from the Applicant his weekly written update on the general insurance business. This document contained a statement that the scorecards were written. The fact that scorecards were stated to be written, signified in his mind that they had been drafted, were under discussion with the employees, and were very close to being signed off.

[58] On 30 November 2009 he received from the Applicant his weekly written update of the general insurance business. In this document he made the reference “scorecards for completion next week”.

[59] On 7 January 2010 he sent an email to the Applicant and other members of the senior management team in which he wrote that at this stage all appraisals should now be completed. Staff should be able to clearly articulate what is high-performance and what is failure. The Applicant did not, following this email raise any issues with him in relation to scorecards.

[60] After his conversation with Ms Gladman on 15 March 2010, he asked a number of Mr Tobin’s team members about whether their scorecards had been signed off. He was told by Ms Broxom that her scorecard had not yet been signed off.

[61] Both Ms Gladman and Ms Broxom said to him that on the morning of 15 March 2010 they had had some discussion with the Applicant about how achievement of their KPIs was to be measured. Those discussions had left the position unresolved with the result that they had not signed off on their KPIs.

[62] At the meeting with the Applicant on the afternoon of 15 March 2010 he had said to the Applicant words to the effect “you also told me a number of times that scorecards are in place across your business. It has come to my attention that there are no scorecards in the claims team”.

[63] In response to this the Applicant said to him words to the effect “that is not correct, all the scorecards are being signed off and have been loaded up onto People’s Express”.

[64] On the following day he spoke to Ms Poxleitner about whether or not she had signed off on her scorecards. She informed him that she had not done so nor agreed to her scorecard being loaded onto People’s Express.

[65] He then made enquiries of all of the Applicant’s senior management team, with the exception of Mr Glossat who was away on business, as to whether their scorecards were signed. The outcome of these enquiries was that three of the five senior management team members in the Applicant’s general insurance section informed him that they had not signed off on the scorecard.

[66] In his submissions on behalf of the Applicant, Mr Neil SC agreed that the Applicant had told Mr Smith that he had been told by the risk and compliance team to ensure that Ms Broxom was not in the office on the two days of the review by APRA. This was perfectly reasonable for him to put such a construction on what he in fact had been advised by the risk and compliance team.

[67] He referred to the record of the interview of Ms Vanessa Plunkett of the risk and compliance team. Ms Plunkett said that she told the Applicant that Ms Broxom should not be present at the claims presentation and should not be put in front of the regulators at the APRA meeting. (Exhibit W17).

[68] Consequently, the Applicant’s statement made to Mr Smith was an appropriate response and could not stand as a valid reason for his termination.

[69] Mr Neil also agreed that the Applicant had on 15 March 2010 told Mr Smith that all scorecards had been agreed. He put, that in order to show that that statement constituted a valid reason for his termination, the Respondent needed to satisfy the Tribunal that he made the statement knowing and believing it to be untrue. On the facts of this case it is impossible to be so satisfied.

[70] The evidence demonstrates that the Applicant had a reasonable basis to believe the truth of the statement that he made. It was put that there is no particular formality attending to the signing of a scorecard. They are not in fact signed.

[71] It was also the evidence of the Applicant that the content of the scorecards was not open to negotiation. This is not startling, given that it would be surprising that employees could bargain with their employer about the terms on which their employer would pay them a bonus etc.

[72] The worst that could be said of the Applicant’s state of mind is that there was a disconnect between his understanding of the scorecards and some of those who reported to him. It may be that some of the employees who reported to him have a different understanding of whether scorecards were open to negotiations or not. There was no evidence to suggest that scorecards were the subject of negotiations.

[73] There were several instances where the Applicant raised the issue of scorecards and where he would have expected his managers to communicate their belief that they were not or had not been finalised. None of them ever raised such objections. On 4 February, 1 March and on the morning of 15 March 2010 when a demonstration was given as to how one loaded scorecards onto the People’s Express system, nothing was raised by the managers.

[74] One of the employees who are alleged to have considered that her scorecard had not been finalised was Ms Gladman. She was not called to give evidence. Ms Broxom, in her evidence said that at no time had she told the Applicant that she was not in a position to load her scorecard onto People’s Express. As to Ms Poxleitner, the substance of her evidence was that the real focus of her concern was her budget rather that the objectives in her scorecard.

[75] None of the evidence of those employees is sufficient to challenge the Applicant’s view that he considered that the scorecards had all been agreed. Having regard to the evidence, the Tribunal could not be satisfied that the Applicant did not believe that the statement he made to Ms Smith was untrue.

[76] In his submission on behalf of the Respondent, Mr Hatcher SC reminded the Tribunal that in Ms Broxom’s evidence (Exhibit W5, paragraph18), she told of a conversation with the Applicant in February 2010 about the scorecard criteria. During that conversation she made it clear that the criteria was not agreed and as a consequence she had not been able to explain to her staff what the criteria was. That evidence was uncontested. The lack of any subsequent conversation to a different effect means it is impossible to accept that the Applicant’s belief that the scorecard was agreed could be well based.

[77] The Applicant conceded that scorecards are important. Not only are they the bases for examining an employee’s performance, they also form the basis of bonus payments. The need for clarity in the scorecards was a feature of his performance review in October 2009. Thus, we now have a situation where a senior manager is not only unaware of the true position in relation to the scorecards of his direct reports, he is so actively under a false impression that he is prepared to assure his manager of this false understanding and in circumstances where each of the three employees say that they told him directly and unmistakably that they did not agree with their scorecards.

[78] He said that the evidence cannot be reconciled. One needs to accept either the evidence of Ms Poxleitner and Ms Broxom and what Ms Gladman is said to have told Mr Smith, or one accepts the evidence of the Applicant.

[79] In respect of the APRA review, the Applicant agreed that the compliance team had directed him to ensure that Ms Broxom was unavailable to present to APRA. They had not told him to ensure that Ms Broxom was away from work on those days.

[80] If the Tribunal finds that the Applicant misled Mr Smith that would represent a valid reason for dismissal.

[81] Indeed, the misleading of Mr Smith by the Applicant on both issues clearly represents conduct contrary to the core values of the Respondent, including integrity, and in terms of its misconduct policy, the provision of false and misleading information to the Respondent.

Conclusion

[82] In determining whether the termination was harsh unjust or unreasonable, section 387 of the Act sets out certain matters that must be taken into account.

“387 Criteria for considering harshness etc.

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

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

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

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

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

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

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

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

(h) any other matters that FWA considers relevant.”

[83] Turning to the issue of whether a valid reason for termination existed, it is clear that the Applicant made erroneous statements to his manager Mr Smith. For example, in his email to Mr Smith following the meeting on 15 March 2010 (Exhibit W2/MS16) he said:

“. . . As a result they (the Prudential Review team) asked that I present on claims to APRA on day one and that I ensure she (Ms Broxom) was not in the office on day two of the review . . . ”

I have earlier referred to other words of the Applicant (see [20]) above.

[84] There is no question that the compliance team did not so direct or advise him. This is clear from his evidence (see [22] above). I do not accept the proposition put by Mr Neil that it was perfectly reasonable for him to put such a construction on what he had been advised by the risk and compliance team. The Applicant made the decision to keep Ms Broxom away. He sought to put responsibility for that decision on others. The direction to Ms Broxom to stay home resulted in her sending the inappropriate email which, among other things, might have endangered the Respondent’s standing in the eyes of APRA. That may have been a reason for the Applicant to therefore suggest the compliance team’s role as the genesis of Ms Broxom’s reaction, when in fact it was his.

[85] I find that the Applicant deliberately mislead Mr Smith.

[86] As to the scorecards, the Applicant assured Mr Smith on several occasions and in particular on 15 March 2010 that the scorecards of his direct subordinates had been agreed. It was said that he had a reasonable basis for this belief.

[87] I am satisfied from the evidence that he could not have had this belief. Whatever the reason for Ms Poxleitner’s concerns about her scorecards, the fact was that her scorecard had not been agreed. To suggest that Ms Poxleitner was agitating the issue of her budget, and not raising anything else and that this meant that the scorecard must have been agreed to is a nonsense. I do not accept it. I prefer the evidence of Ms Poxleitner to that of the Applicant as to her having told him that she would not accept her draft scorecard until the budget had been addressed.

[88] I also accept the evidence of Ms Broxom (and prefer it to the Applicant’s evidence that he could not recollect the conversation) that in February 2010 she made it clear to the Applicant that she could not accept her scorecard. There was no evidence that that position ever changed. There was no basis for the Applicant to suggest that he had reason to believe that it was now agreed.

[89] It was put on behalf of the Applicant that the failure by Ms Poxleitner and Ms Broxom to raise the issue of their non-agreement as to the scorecards, when scorecards were raised as an issue at managers meetings or in training sessions or in emails to managers, provided the Applicant with an appropriate basis to believe that there was agreement. I do not accept that proposition because the Applicant knew that from discussions with Ms Poxleitner and Ms Broxom that no agreement had been reached at those discussions. In the circumstances, absent indications to the contrary from Ms Poxleitner and Ms Broxom, it was not reasonable for the Applicant to assume agreement merely by their silence in these general meetings or communications.

[90] The agreement or otherwise of scorecards requires the manager and the subordinate to agree or come to some position on them. Mr Smith was not asking whether his subordinates had finalised their scorecards with their people, or as to some other matter where the Applicant may have had a broad supervisory role. He was being asked whether he and each individual under his immediate control had come to an agreement where scorecards had been completed and signed off. There is no evidence to suggest that in respect of these two persons (Ms Poxleitner and Ms Broxom), agreement had been reached. It follows that there is no basis for accepting the Applicant’s suggestion that he had a genuine well-based belief that all the scorecards had been completed and signed off.

[91] I find that the Applicant misled Mr Smith when, having been asked directly whether scorecards had been finalised, he had replied that they had all been finalised.

[92] It is not in dispute that the Applicant understood the Respondent’s core values which include integrity and its code of conduct which stressed the need to act with honesty and integrity.

[93] The Applicant was also aware of Prudential Standard GPS520 (Exhibit Tobin 1/BT39) and in that regard for persons who are responsible for the management or oversight of a general insurer to act with honesty and integrity.

[94] In my view, the Applicant’s conduct in misleading Mr Smith in the terms of my findings at [85] and [91] is at odds with the core values and policies of the Respondent and that conduct amounts to a valid reason for the termination of the Applicant.

[95] It is not disputed that the Applicant was informed of the reason for his termination.

[96] As to whether the Applicant was given an opportunity to respond to the allegations of the Respondent, it is clear firstly, that the moment he challenged Mr Smith’s role in the Respondent’s investigation, Mr Smith was removed from the process.

[97] I am satisfied that the investigation carried out by Ms Hart involved extensive interviews, provided particulars of the allegations (e.g. Annexure 1 - Summary of allegations [Exhibit T1/BT30]) and provided adequate opportunities for the Applicant to put his version of events. It is also clear that soon after the Respondent raised concerns regarding the Applicant, the Applicant was assisted by solicitors.

[98] While the Applicant had been terminated on 5 May 2010, the Respondent set out its concerns and allegations as early as 19 March 2010. Soon after on 23 March 2010 the Applicant’s solicitors responded to a number of those concerns. There were further communications that involved the Applicant’s solicitors. I am satisfied that the Applicant was given an opportunity to respond to the Applicant’s concerns and allegations.

[99] There was no suggestion that in this matter, that there was any refusal by the employer to allow the Applicant to have a support person present to assist.

[100] I did not find that sections 387(e), (f) and (g) are particularly relevant for present purposes.

[101] As to any other matters that the Tribunal considers relevant, I have taken into consideration the impact of termination on the Applicant, the circumstances of his termination, and his relatively senior standing in the insurance/banking industry. The termination has impacted adversely on his ability to secure further employment at a senior level.

[102] On the basis of all the matters to be considered, including the need to ensure that a “fair go all round” is afforded to both the Applicant and the Respondent, I find the termination of the Applicant was not harsh, unjust or unreasonable.

[103] Given that finding, the application by the Applicant for an unfair dismissal remedy must be dismissed.

COMMISSIONER

Appearances:

I Neil SC of counselwith P. Costigan, solicitor, for the Applicant.

G. Hatcher SC of counsel with I. Taylor, solicitor, for the Respondent

Hearing details:

2010

Sydney:

September 6, 9;

November 1, 2, 3, 4, 5, 9.

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<Price code C, PR504594>