Daniel Sedgman v MacMahon Holdings Limited T/A MacMahon Contractors Pty Ltd

[2014] FWC 1025

[2014] FWC 1025

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Daniel Sedgman
v
MacMahon Holdings Limited T/A MacMahon Contractors Pty Ltd
(U2013/13657)

DEPUTY PRESIDENT HAMILTON MELBOURNE, 20 FEBRUARY 2014

Application for relief from unfair dismissal.

[1] On 17 September 2013 Mr Daniel Sedgman made an application under section 394 of the Fair Work Act 2009 for an unfair dismissal remedy with respect to the termination of his employment on 26 August 2013. The matter was conciliated and no agreement was reached. The matter was heard before me by a private conference pursuant to section 399. It is agreed, and I am satisfied, that all the jurisdictional limitations in section 382 to 389 are not applicable and that the only issue between the parties is that of whether or not the termination was harsh, unjust or unreasonable.

[2] The following witnesses gave evidence:

● Mr Daniel Sedgman;
● Mr Evan Mead;
● Mr Stephen Gillies;
● Mr Scott Porter;
● Ms Lucy Hennessy;
● Mr John Michael Anger.

[3] I have had regard to all the evidence and submissions. I reserved the right to publish further reasons for decision.

Section 387(a) - Valid reason

[4] The term ‘valid reason’ was considered by Northrop J in Selvachandran v. Petron Plastics Pty Ltd 1, in relation to s.170DE of the Industrial Relations Act 1988. He said:

“Section 170DE(1) refers to a ‘valid reason, or valid reasons’, but the Act does not give a meaning to those phrases or the adjective ‘valid’. A reference to dictionaries shows that the word ‘valid’ has a number of different meanings depending on the context in which it is used. In the Shorter Oxford Dictionary, the relevant meaning given is ‘2. Of an argument, assertion, objection, etc; well founded and applicable, sound, defensible: Effective, having some force, pertinency, or value.’ In the Macquarie Dictionary the relevant meaning is ‘sound, just or well founded; a valid reason.’

In its context in s. 170DE(1), the adjective ‘valid’ should be given the meaning of sound, defensible or well founded. A reason which is capricious, fanciful, spiteful or prejudiced could never be a valid reason for the purposes of s170DE(1). At the same time the reason must be valid in the context of the employee’s capacity or conduct or based upon the operational requirements of the employer’s business. Further, in considering whether a reason is valid, it must be remembered that the requirement applies in the practical sphere of the relationship between an employer and an employee where each has rights and privileges and duties and obligations conferred and imposed on them. The provisions must ‘be applied in a practical, commonsense way to ensure that’ the employer and employee are each treated fairly, see what was said by Wilcox CJ in Gibson v Bosmac Pty Ltd (1995) 60 IR 1, when considering the construction and application of a s170DC.”

[5] In this case the employer, MacMahon Contractors Pty Ltd, engaged the applicant from 8 August 2008 until it terminated his employment on 27 August 2013 by letter. In the letter the employer stated that Mr Sedgman breached site operating procedures, MacMahon values and codes of conduct because he engaged in a high risk task without the authority or competencies to do so; disregarded and breached site procedures he was aware of and put the safety of himself and others at risk. It is clear from this letter and the evidence of Ms Hennessy that Mr Sedgman was not summarily dismissed but was dismissed with pay in lieu of notice. Even if he had been summarily dismissed it would not make a difference to my decision.

[6] In this case it appears on the morning of 11 August 2013 Mr Sedgman set up a Komatsu truck to have its tyre removed. He used a machine called a tyre handler on the truck tyre and engaged in a number of other activities including removing the cleats and tyre nuts. He then removed the tyre and inflated it. Before doing this he had prepared a job hazard analysis which was signed by his shift supervisor, Robert Huston and open cut examiner, Rod Hill 2. Various witnesses gave evidence that the estimate of hazard he made in the Job Hazard Analysis was too low. It should have been higher. I accept that evidence.

[7] In general terms I accept the evidence given by the employer witnesses and prefer that evidence where it is inconsistent, in most cases, with the evidence given by Mr Sedgman. Mr Sedgman also did not include in the Job Hazard Analysis the removal of cleats and tyre nuts, as he should have done. He also had a conversation with Mr Huston. He records that conversation at paragraph five of exhibit S1. He says:

I believe that of all the crew members present at the time I was the most qualified in tyre fitting and I therefore asked Rob Huston, the shift supervisor, whether he wanted me to set truck 6143 up for a tyre change-out. Mr Huston asked whether I had the competency for the tyre handler and I responded that I did.

[8] Those words suggest that Mr Huston was asked whether Mr Sedgman could set up the truck for a tyre change. He was not expressly or implicitly asked for permission or authority or agreement for Mr Sedgman to actually change the tyre and engage in the various activities that he did engage in. This interpretation is consistent with the incident report prepared by Mr Huston and which is an exhibit in these proceedings. In this incident report Mr.Huston said 3:

I recall Daniel coming to me before 2nd crib break and asking me if I would like him to set RDT 6143 up on the tyre bay ready for dayshift to remove tyres. I told him that was a good idea and that I thought he was being proactive and he is passed out to operate 730E. I thought this was a great help as this was the third truck to go down with a tyre issue throughout the night. At no time did I instruct Daniel to deflate or remove tyres as my understanding was he was only getting the area set up for the tyre fitter on dayshift. The other guys in the workshop told me they were not going to help him if he asked them because they were not confident in his abilities and I informed them he wasn’t instructed to take the tyre off, that he was only setting up the area for the tyre fitter.

[9] Mr Huston is not available to give evidence but his incident report is a business document admissible under the Evidence Act 1995 4 and required for the purposes of the special coal legislation and procedures in the mine, which was conceded during proceedings. In any event the Commission is not bound by the rules of evidence. Ms Centra has been denied the opportunity to cross-examine Mr Huston on his evidence but it seems similar in nature, in any event, to the evidence I just quoted from paragraph five of Exhibit S1. I also note that evidence was given by other witnesses to similar effect and other witnesses had greater or lesser degrees of direct knowledge and were able to give such evidence to a greater or lesser degree.

[10] I was unfortunately not able to place much weight on the evidence given by Mr Sedgman. I am not satisfied that Mr Sedgman was in any way authorised by Mr Huston to actually engage in the activities that he did engage in. I am also satisfied, and it is not in contention, that Mr Sedgman was not actually competent to perform the tasks that he did engage in and that they required a number of certificates including a certificate for the removal of the tyre and a certificate for inflating the tyre and deflating it. The proper competencies for the tyre removal task are those set out in standard operation procedure M102-036 which required him to have completed a RIISAM210A, which he had not done.

[11] Mr Sedgman claims to have believed that he had the appropriate qualifications. However, Mr.Sedgman agrees that he was aware of and had completed training in the SOP Assembly, Servicing, Maintenance and Modification of Plant document 5. That document specifically states that there is another document dealing with Maintenance of Tyres and Rims, SOP M102 0366. This is the relevant procedure for the activity he engaged in, and it is agreed that he was not competent in that procedure. Mr.Sedgman then was specifically told that another procedure was applicable to the activity he undertook. He has no basis for a claim that he believed that he had the appropriate qualifications. This reinforces my view that Mr.Sedgman did not act with sufficient caution and judgement.

[12] Another factor which we need to take into account is the assessment made by his colleagues of his approach to safety. I have just quoted the incident report made by Mr Huston and the view expressed by other people (‘guys’) in the workshop that they were not going to help him because they were not confident in his abilities. Similar evidence was given by other work colleagues in incident reports and in evidence given to me. Mr Evan Mead said in his incident report 7 that:

All the boys in the workshop said we weren’t comfortable with him removing the tyre and would not work with him and Robbie said, ‘No, he is not removing. He is only setting the job up.’ Robbie did not instruct him at any time, to my knowledge, to remove the tyre -

[13] Mr Gillies gave similar evidence in exhibit M16. In his incident statement form attached to the witness statement he states, and I quote:

I signed the front of the JHA but at no point was I going to sign on to work with Daniel as I have no confidence in his ability to operate.

[14] Mr Anger said that he did not consider Mr Sedgman’s approach to safety appropriate, as did virtually all his colleagues who gave evidence. I found their evidence persuasive. The actions taken by Mr Sedgman must be considered in the context of that assessment made as to the approach he took to safety. The approach he took to safety was not appropriate for a highly dangerous place such as a coal mine regulated by the Coal Mining Safety and Health Act 1999 which establishes, in section 39 a number of specific obligations on a coal mine worker or other person at a coal mine. These obligations are specific to this area of work and have regard to the special nature and special danger of this type of work.

[15] Associated with that, witnesses gave a substantial amount of evidence about the special danger and special nature of the tyre fitting task. A tyre is compressed energy, and is highly dangerous, and this energy can be released in an explosion if not handled correctly. The tyre is many tons in weight, and taller than a man, and could have fallen on Mr Sedgman and killed him if not handled correctly. The tyre is extremely heavy, extremely large, and extremely difficult to manipulate. A number of witnesses gave evidence that the procedure followed by Mr Sedgman in his task was not appropriate, including the fact that he removed all cleats and that he operated as a one person rather than two person operation.

[16] Even if the standard operating procedure does not deal specifically with those issues, in a coal mine there is both individual responsibility, as indicated by the special Act, and section 39 I have just quoted, as well as responsibility of the company. The company had responsibilities and Mr Sedgman had responsibilities. The general view taken of Mr Sedgman by those that worked with him and observed his conduct was that he did not approach those responsibilities in an appropriate fashion. Others knew about the appropriate procedures to be followed in relation to tyre handling, or knew about the limits of their knowledge and abilities. They gave evidence about the shortcomings of Mr.Sedgman in his approach to safety.

[17] In this case it appears that Mr Sedgman has acted in a reckless and careless fashion rather than with appropriate judgment and care for the extremely dangerous circumstances of a coal mine and the extremely dangerous circumstances of the tasks he undertook. I am not satisfied that Mr Sedgman reasonably believed that he was competent and certified to perform the task.

[18] It is also said that the job hazard form, signed off by a supervisor, constituted a work order. A number of things must be said about that. Firstly, evidence was given by a number of witnesses, which I accept, that a job hazard document of that nature is not a work order. Secondly, the job hazard analysis, as I have indicated, was not properly filled in by Mr Sedgman. Thirdly, even if there was some lack of performance of duties on the part of Mr Huston that nevertheless does not, in these circumstances before me, absolve Mr Sedgman from any responsibility. In a hazardous workplace such as a coal mine Mr Sedgman has substantial responsibilities, as indicated by the Coal Mine Safety Act.

[19] The conclusion I have formed is that Mr Sedgman engaged in a course of conduct which was careless and which was extremely dangerous in that it could have injured himself or anybody who happened to be in the vicinity. The fact that no-one was in the vicinity does not mean that there was no possibility that some injury could not have occurred to someone else. Needless to say, the possibility of death or injury to Mr Sedgman is an issue of a most serious kind which must be given great weight.

[20] I also note that I have been referred to a number of cases including Lawrence v. Coal and Allied Mining Service Pty Ltd (2010) FWAFB 10089. I have had regard to all the authorities put to me. I note that there are substantial differences in facts between the present matter and Lawrence including, for example (see paragraph 32) the risk is of a different nature and the circumstances of Mr Lawrence are of a different nature. Mr Lawrence had 28 years service, while the service of Mr Sedgman is only 5 years. Mr Sedgman undertook an extremely dangerous set of activities and risked his life and that of others, and lacked care and was reckless in his actions, whereas in Lawrence they were of a different nature. Such decisions are specific to the factual circumstances applicable in each case.

[21] It is said that Mr Sedgman was treated inconsistently with other employees 8. I am not satisfied, on the information before me, that Mr Sedgman was treated inconsistently. Rather, I am satisfied that the employer took an approach of approaching each matter on its individual merits, assessing it and taking action as best it could. Again, issues of safety are important and an employer must be able to apply disciplinary procedures to enforce safe conduct in a dangerous place like a coal mine.

[22] A number of other matters are raised by the applicant, including an allegation the applicant’s conduct was not wilful or deliberate, malicious or intentional. In my opinion the action was careless and reckless. They say that he was not provided with the appropriate OHS training, with respect to the tyre changing competencies, by MacMahon. The evidence before me is that MacMahon took a very rigorous approach to safety and training employees, that other employees entered into that training in good faith and respected the approach taken by MacMahon to training and were concerned about the inappropriate approach to safety issues taken by the applicant, Mr Sedgman.

[23] It is said that this was an isolated incident 9. However Mr Sedgman had been warned before in 2010 on two occasions and in addition there had been, on the evidence before me, conversations between Mr Sedgman and work colleagues about safety issues. Mr Sedgman’s less than adequate approach to safety was not a new issue, rather it had been raised with him on previous occasions by other employees. It is said that the applicant was not a supervisor who should be expected to set an example. That is true but nevertheless Mr Sedgman bears some responsibility for safety issues and did not discharge them. I refuse to accept that I or the employer should turn a blind eye to conduct of such an unsafe nature.

[24] It is said that the applicant was not aware that he did not hold the relevant qualification or competencies to be able to remove the wheel. I have already made some comments about that. He had been trained in a procedure which specifically pointed out that another procedure applied to tyre changing, and he should have been aware of this.

[25] The evidence is uncertain as to the extent to which Mr Sedgman had engaged in this sort of work. It appears that on no prior occasion did he ever do so by himself. The applicant’s conduct was approved and authorised by his supervisor, it is said, however that is a misinterpretation of the Job Hazard Analysis which did not constitute such. Nor was there a conversation to that effect. Even if there had been some misunderstanding by Mr Sedgman, commonsense and his knowledge of safety should have dictated far more caution than he exhibited.

[26] It is said that the applicant was honest and open in the investigation process and happy to acknowledge that a mistake had been made. It appears there was some degree of openness about the events. However, in my view, Mr Sedgman has not displayed sufficient remorse or understanding of the careless nature of his conduct in relation to this issue. I had the opportunity to observe him giving evidence and that was the opinion that I formed. It is said that the applicant has a long and satisfactory working history with the respondent, having been employed for almost five years. That is correct to some extent but I have also noted the written warnings and the conversations about safety and Mr Sedgman’s attitude to safety issues.

[27] Exhibit M7 is a guide to fair play. This again is an indication of the seriousness with which MacMahon takes safety issues and overall, when applied to the present circumstances, it suggests that termination be a possible remedy provided that appropriate circumstances exist. In my view those circumstances existed.

[28] I am therefore satisfied that there was a valid reason for the dismissal of Mr Sedgman relating to his conduct.

Section 387(b) - Notified of that reason

[29] Mr Sedgman was notified of that reason by letter of 28 August 2013 10. I also note that it is not in question that the employer engaged in procedural fairness in this matter in the actions it took to give Mr Sedgman the opportunity to respond to the investigation. Real issue was taken with the issue of a valid reason and overall harshness, as I have already mentioned.

Section 387(c) - Opportunity to respond

[30] It is agreed that Mr Sedgman was given that opportunity and, for example, attachment DS3 to exhibit S1 is a letter dated 22 August 2013 where the employer provides that opportunity. Other similar evidence has been given, which I will not go to.

Section 387(d) - Support person

[31] An allegation was made that some form of unreasonable conduct had been made, engaged in by MacMahon, in relation to a support person. However, quite properly, Ms Centra withdrew that allegation. In any event, I am not satisfied that any improper conduct was engaged in by MacMahon in relation to a support person.

Section 387(e) - Unsatisfactory performance

[32] In this case the dismissal does not relate to unsatisfactory performance.

Sections 387(f), (g) - Small business, human resource specialists

[33] In this case the employer is a large employer with dedicated human resource management specialists and high or at least ordinary standards are to be expected. This is not a small business or business in which some discount must be made for the size of business or its human resource specialist.

Section 387(h) - Other matters

[34] I have had regard to all the submissions and evidence.

Conclusion

[35] Having regard to my findings in relation to all the factors set out in section 387 my conclusion is the applicant’s dismissal was not harsh, unjust, unreasonable. The applicant, Mr Sedgman, was accorded a fair go all round. An order dismissing his application was issued. I conclude by saying that these proceedings are always of a somewhat melancholy nature. Having regard to the effects on Mr Sedgman of a dismissal, which I have had regard to, these are adverse effects, these are real effects and I am required to have regard to them under the Act and I have done so.

[36] I wish Mr Sedgman well in his future employment and hope that he can find appropriate work in the future. I also, of course, wish MacMahon well, including in relation to the very important issue of safety which is of some importance in an area such as coal mining. MacMahon appears to adopt an appropriate approach to safety which is, of course, to the great benefit of all its employees including Mr Sedgman and those still remaining at the workplace. I thank the representatives for their submissions and the hard work that has gone into these proceedings.

[37] An order is contained in PR547686 of February 11, 2014.

DEPUTY PRESIDENT

Appearances:

Ms C Centra, lawyer for the applicant.

Ms C Spence, employee relations consultant for the respondent

Hearing details:

2014

Melbourne

10 February

11 February

 1 (1995) 62 IR 371 at 373

 2   Attachment DS5 to exhibit S1

 3   Exhibit S3 paragraph five

 4   Grubisic v. Chubb [2011] FWA 4322 at 9. See section 69 of that Act, and for example AISIC [2008] NSWSC 1099 at 39 and 41, and Blomfield [2009] NSWSC 978

 5   Exhibit S1, paragraph 16 states that Mr.Sedgman was aware of SOP Assembly, Servicing, Maintenance and Modification of Plant document, Exhibit M12

 6   It states this at paragraph 3, Exhibit M12. The other procedure is Exhibit M13.

 7   Exhibit M14, Attachment DMDS1

 8   Darvell v Australia Post [2009] FWA 1406 (unreported, Hamilton DP, 2 March 2010); Darvell v Australian Postal Corporation (2010) 195 IR 307. APS Group (2011) 209 IR 351

 9   Exhibit S2, paragraph 24

 10   Exhibit S1, Attachment DS4

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<Price code C, PR547654>