Debra Maree Prince v Rentokil Pty Ltd
[1994] IRCA 108
•11 Nov 1994
IN THE INDUSTRIAL RELATIONS COURT
OF AUSTRALIA VI 397 of 1994
VICTORIA DISTRICT REGISTRY
B E T W E E N:
DEBRA MAREE PRINCE
Applicant
A N D
RENTOKIL PTY LTD
Respondent
Reasons for Judgment
11 November 1994 PARKINSON JR
In this matter the applicant alleges that the termination of her employment by the respondent contravened the provisions of S170DF(1)(f) and 170DE (1) and (2) of the Industrial Relations Act 1988 (“ the Act”).
The applicant contends that the reason or one of the reasons for the termination of her employment included reasons related to her sex. It is also alleged that the termination was not for valid reason and that, having regard to the personal circumstances of the applicant, it was harsh, unjust and unreasonable.
Background and findings of fact:
The applicant was employed by the respondent at the Scoresby branch of its Healthcare Services division commencing from 10th January, 1994. Her initial employment was subject to a probationary period of three months. The initial probationary period was to expire on 10th April, 1994, at which time a decision as to permanent appointment was to be made by the respondent.
Prior to the expiration of the probationary period, the respondent decided not to permanently appoint the applicant but rather to extend the probationary period. This probationary period extension was the subject of a jurisdiction argument by the respondent which was heard and decided as a preliminary point at the commencement of these proceedings. The decision was that whilst there may have been a unilateral extension to the probationary period, that extension did not operate to bring the employment within the exclusion contained in Regulation 30B(1)(c) of the Act. However, the issue of a probationary period is nevertheless relevant for other purposes in these proceedings, and is discussed later in this decision.
The nature of the business conducted by the respondent involved a combination of servicing existing clients and developing new business.
It is apparent from the evidence of the respondent’s witnesses that there was, during the course of the applicant’s employment, and there remains, a heavy emphasis on “cold-calling”, and that this style of selling was expected to constitute 80 - 90% of the calling time of the applicant. This style involves direct approaches being made at the business premises of businesses which are not existing customers of the respondent. This selling style is clearly a very demanding and stressful style of selling, involving as it does frequent rejection from potential customers.
The applicant did not dispute that such cold-calling requirements existed, however she disputed that she had been informed of the emphasis placed on this type of selling at the time of the employment interview, saying instead that she had been informed of it subsequent to her employment. She also disputed that this way of selling was necessarily the most appropriate for the business. I am satisfied that the requirements for, and emphasis on, cold-calling in the respondent’s business were brought to the applicant’s attention and were re-emphasised by Ms. Phillips, the applicant’s Sales Manager, and Mr. Thorsen, the Branch Manager, at a staff meeting in early March, 1994. The evidence of Ms. Phillips was that the sales consultants were told in early March that they were not doing enough cold calling and that the level was to be increased immediately. It was apparent in the evidence of the applicant that she disagreed with the approach of her Sales Manager to business development, and did not agree that cold-calling was the most appropriate way to develop the business. The evidence of the applicant was that she did not feel that it was essentially her job to go out and do cold-calling.
Upon commencement of employment, the applicant received extensive training provided by the respondent through a programmed training schedule which included formal sessions and on the job training and supervision. This training period occurred for three weeks (Exhibit G1).
During the course of the initial period of her probation, the applicant’s work performance, judged according to the amount of business written, was acceptable. Although targets and budget figures were set by management for all employees, the evidence was that those figures were not strictly applied to probationary employees in their first month of employment, although more regard was had to them at later stages of the probationary period.
Those target figures were evidenced by Ms. Phillips in examination in chief, and the applicant in cross examination, to be:
January, 1994 - $ 7,000.00
February, 1994 - $ 10,000.00
March, 1994 and
monthly thereafter - $18,500.00
During February, 1994 the applicant’s figures did not reach the target figure of $10,000.00. The amount of sales achieved in that month was
$6612.00. During March, 1994 the applicant achieved sales figures of $10,118.00. Once again, this amount was below the amount set as her sales target. During the course of her probationary period, the applicant experienced some serious personal difficulties associated with a member of her immediate family. She also suffered from intermittent periods of illness.
The respondent’s evidence is that by 21st March, 1994, the applicant’s work performance was being formally reviewed by the respondent’s Sales Manager. Her probationary period of employment was to expire on 10th April, 1994. The respondent’s evidence was that the following deficiencies were evident in the applicant’s work performance:
- The applicant’s level of cold-calling in the job was
significantly less than it was required to be.
- That the applicant had clearly expressed her reluctance to
cold-call and that she was unsuited to this type of selling.
- This latter point was evidenced, it was submitted by the
respondent, by the fact that the applicant approached the
Service Manager and asked for a transfer to the Service
Department to enable her to avoid further cold-selling.
- That the applicant had not achieved the level of sales expected
of her relevant to the target set and this was a factor in the
decision that the applicant was not appropriate for permanent
appointment.
- That the applicant’s sales performance was significantly below that that of another employee who commenced at the same time as the applicant.
- That the applicant had failed to maintain adequate records for
her Sales Managers’ use.
- That the applicant spent too much time in the office and not
enough time out on the road attending to cold-calling and other customer requirements.
- That the applicant refused to cooperate in management
attempts to monitor her sales performance by refusing, on one occasion, to allow the Sales Manager to accompany her out on the road, notwithstanding that this was company policy and usual practice.
- That the applicant, as a result of her friendship with another
sales consultant and the latter’s hostile attitude towards the
Sales Manager, had become an uncooperative and disruptive
influence in the workplace.
It is submitted by the respondent that by mid to late March the respondent had decided not to appoint the applicant to a permanent position, and that there was a real possibility that her employment would not be continued beyond the probationary period.
The applicant’s evidence was:
- That she had found cold-calling stressful merely during the
difficult personal period she was experiencing and had no
difficulty with that sales approach as a general rule.
- That she had met most budget requirements and that “ ups and
downs” were usual in the industry, and that it was unfair to
judge her performance over such a short period of time.
- That it was unfair to assess her performance by reference to
another employee who had commenced at the same time
because the areas were different in sales history.
- In so far as the probationary period was concerned, she said that towards the end of the initial probationary period more regard ought to have been had by management to her personal problems in assessing her suitability for permanency, and that this was so also in so far as management purported to extend the probationary period beyond the initial three month period.
- The revised targets set by management in the extended
probationary period were unreasonable and impossible to
reach in the time accorded.
The applicant further contends that the real reason for her termination was as a result of an incident involving inappropriate behaviour of a sexual nature on the part of a male manager at a company social function on 18th March, 1994. The respondent denies that the incident formed any part of the reason for the termination of the applicant’s employment and contends that the reason for the termination was the failure of the applicant to satisfy the respondent that she was able to adequately perform the job during her probationary period, or that she was able to achieve the level of sales required of her.
Ms. Phillips and Mr. Thorsen gave evidence that on 8th March, 1994 the applicant was informed by Mr. Thorsen of concerns as to her work performance, including her negative attitude to her work. This came about as a result of the expressed dissatisfaction of Ms. Phillips as to the applicant’s work performance. The applicant was informed that her performance required improvement. The applicant, whilst agreeing that a meeting took place between them at about that time, and whilst stating that there was a discussion about her problems, denied that the conversation which occurred related to her performance. No explanation as to a contrary purpose for the meeting was given by the applicant. I accept that the conversation occurred on 8th March, 1994 and, whilst the applicant may not recollect it in those terms, that it was for the purpose evidenced by Mr. Thorsen and Ms. Phillips.
On 21st March, 1994 the applicant was absent from work as a result of illness. Ms. Phillips contacted the applicant at home by telephone on that day. According to Ms. Phillips, an appointment had been scheduled between them for that morning and it had been her intention to raise matters relating to the applicant’s continued employment at that time. During the telephone conversation with the applicant, the issue of her sales performance was raised with her, together with Ms. Phillips’ view that the applicant would not remain after the probationary period. Ms. Phillips told the applicant that neither her attitude nor her sales performance was up to standard. She also informed the applicant that, in her view, she was not up to the job.
The respondent says the applicant was informed by Ms. Phillips that, if she was to remain at the expiration of her probationary period of employment, she was required to achieve a figure of $ 7,000 in sales by 8th April, 1994. This period involved 8 selling days (Exhibit L4). The evidence of the respondent was that this advice was given to the applicant by telephone on 21st March, 1994. The applicant denies that this was so and says that she first heard of the target by way of the letter dated and delivered on 29th March, 1994. The applicant does concede, however, that the conversation did take place on 21st March, 1994 and that in that conversation her continued employment prospects were discussed. I am inclined to find that the applicant was advised of the target at that time. However, having regard to the attendance of the applicant at the seminar in Sydney, the period of time lapse between that phone call and the written advice was of no practical significance or consequence to the outcome of achieving the target or otherwise.
On 7th April, 1994 the applicant was given an extension of the time for the achievement of the figure set (Exhibit L5). That extension was granted to 22nd April 1994 and the target amount increased to $9,500 in 11 selling days. That extension of time also resulted in the probationary employment period being extended from 10th April, 1994 to 22nd April, 1994.
On 18th April, 1994 a meeting took place between Ms. Phillips, Mr. Thorsen and the applicant. At that meeting there was discussion as to how the applicant intended to achieve the target sales figure which had been set. There was also an expectation in the Sales Manager that she would be accompanying the applicant on her sales run that day. The applicant denied that this was the case and, as a consequence, the date was altered to the following day, the 19th April, 1994. On that following day the applicant was absent due to illness. On 20th April, 1994 the applicant telephoned Mr. Marks, the Area Manager, wherein she raised the meeting of 18th April, 1994 and the target that had been set. Mr. Marks extended the date for achieving the target to 26th April, 1994.
On 26th April, 1994 the applicant had not achieved the sales amount which had been set, and her employment was terminated at a meeting between the applicant and Ms. Phillips.
Having dealt with the above facts and background, I turn now to determine the matters raised by S170DF(1)(f) and S170DE (1) and (2) of the Act.
It is appropriate to deal first with the alleged contravention of S170DF(1)(f) of the Act.
S170DF(1)(f)
The applicant alleges that she was terminated for the reason of her sex or for reasons including that reason. I am of the view that this term in S170DF(1)(f) includes reasons which arise as a result of the sex or sexual characteristics of a person. The respondent submitted that the sex of the applicant was not the reason, and formed no part of the reason, for the termination of employment, and that such an allegation was against the weight of the evidence.
S170DF (1)(f) provides:
“An employer must not terminate an employee’s employment for any one or more of the following reasons, or for reasons including any one or more of the following reasons:
...
(f) race, colour, sex, sexual preference, age, physical or mental disability, marital status, family responsibilities, pregnancy, religion, political opinion, national extraction or social origin”.
S170DF(1) places upon the respondent the onus of proving, on the balance of probabilities, that the termination of the employment was not for the reason of sex or for reasons including that reason. The reason which is required to be ascertained is the reason which motivated the employer to terminate the employment and not merely the stated reason. The test is a subjective one.
Whilst there are no authorities of this court in relation to the meaning of the term “for any one or more of the following reasons” in the context of S170DF(1), there is ,however, a line of authorities considering the application of similar statutory concepts in proceedings pursuant S334 of the Act (formerly S5 of the Conciliation and ArbitrationAct 1904).
In Bowling v General Motors-Holdens Pty Ltd (1975) 8 ALR 197 the Court had regard to S5(4) of the Conciliation and Arbitration Act.
In the joint judgment of Smithers and Evatt JJ, their Honours said (at pages 200-201):
“Reading s. 5(4) as part of s. 5 taken as a whole, we are of the opinion that a particular action taken by an employer may be said to have been actuated by a particular reason or circumstance if that reason or circumstance was a substantial and operative factor influencing him to take that that action. Further, an employer may be said to have been actuated by a particular reason if it was a substantial and operative factor influencing him to take that action, although that reason was but one of a number of reasons which so influenced him....
The defendant contends that on the evidence the court should be satisfied that in dismissing the informant it was not actuated by the circumstance that he was a shop steward. The defendant says that the reason for the dismissal was that stated to the informant on 5 February 1975, and arose out of the work record of the informant, which, it says, disclosed breaches of duty by the informant in his capacity as employee so serious and significant as, not only to explain the dismissal, but also to induce satisfaction that the informant’s position of shop steward was not a substantial and operative factor influencing the defendant to decide upon the dismissal...
In relation to the critical issues the immediate inquiries are, what person or persons made the decision to dismiss the informant, what relevant circumstances were within their knowledge, whether it was known to them that the informant was a shop steward, and if they knew of the informant’s position of shop steward, what they have to say as to whether or not that matter had any and what degree of influence in the making of the decision.”
I consider that this is an appropriate approach to take in the application of the words “ for one or more of the following reasons” in S170DF(1) of the Act, and to the operation of the onus provisions of S170EDA (2) of the Act. I therefore approach the facts of this case on that basis.
The respondent contended that, as the application filed by the applicant did not raise the issue of S170DF(1)(f) as a ground for alleging that the termination was unlawful, that the onus does not therefore lie upon the respondent to prove that this was not the reason, but rather reverts to the applicant to prove on balance that it was. I do not accept this proposition and am of the view that the respondent bears the onus of satisfying the court that the reason for the termination of employment was not for reasons related to the sex of the applicant. In my view, the application under S170EA which is referred to in S170EDA(2) is not required to have specific written manifestation. It is sufficient for the allegation to have been made orally before the court, as has occurred in this case.
The incident which was said by the applicant to have founded the termination arose from the conduct of the respondent’s Area Manager, Mr. Marks, at a social function. The applicant’s evidence was that during the course of a social function being conducted by the respondent on 18th March, 1994, Mr. Marks had touched her in a sexually suggestive manner on various parts of her body. The evidence in the proceedings was that, due to excessive alcohol consumption, Mr. Marks did not remember the incident although he had subsequently apologised to the applicant and to another employee for the conduct alleged against him.
The applicant raised the issue with the Mr. Marks on two separate occasions, the first being at a restaurant in Sydney on 23rd March, 1994 and the second at the flight lounge of Sydney airport on the following day. Apart from raising it with Mr. Marks, the applicant did not make any complaint to any other management person in the respondent about his conduct either at that time, or at any time prior to the termination or prior to these proceedings. Having regard to the evidence of both Ms. Prince and Ms. Lablache in these proceedings, and to the various instances prior to the termination and these proceedings where the applicant raised the conduct with Mr. Marks, I am, on balance, satisfied that conduct of the type alleged did occur.
Further, I have considered the various cases submitted by Ms. Gyfteas for the applicant, including R v Equal Opportunity Board and anor; ex parte Burns and anor (1985) VR 317, and agree with her submissions that, were I to find that the reason for the applicant’s termination related to the circumstances of the incident on 18th March, then those circumstances would fall within the prohibition contained in S170DF(1)(f) of the Act.
However, the fact that I have found that the incident occurred is a long way from a finding that the applicant’s employment was terminated
by reason of, or including the reason of, her sex. It is conceded by the applicant that there is no direct evidence of the relationship between the incident complained of and the termination which is alleged. Consequently, I am asked to draw an inference as to the reason for the termination, that inference, it was submitted, arising from the circumstances of the termination, including the fact of the written warning being proximate in time to the incident complained of.
It is also apparent from the submissions of the applicant that I am asked to infer that there was in effect either an explicit or implicit agreement or arrangement between the respondent’s managers, Ms. Phillips, Mr. Thorsen and Mr. Marks, to terminate the applicant’s employment as a result of, or consequent upon, the incident of the 18th March, 1994.
I am not satisfied that there is sufficient evidence in the proceedings upon which I could base or maintain such an inference in the face of the evidence of the respondent as to the reasons for the termination. Even if it were to be found that there had been no discussions or concerns as to the applicant’s work performance prior to the 18th March, that is quite a long way from drawing an inference that the events of the 18th March, and the decision to terminate that applicant’s employment, were linked.
I have set out earlier in this decision the respondent’s contentions as to the
reason for the termination of the applicant’s employment. The reasons which are given do find substantiation in the business records and documents of the respondent, including the call records and work sheets prepared by the applicant during the course of her employment. I am satisfied that the applicant’s work performance, including her sales performance, was not satisfactory to the respondent. There are also other facts which are inconsistent with the drawing of or maintenance of the inference sought by the applicant.
The first is that the initial concerns as to the applicant’s work performance and continued employment beyond the probationary period were raised by a person entirely unconnected with the events which took place on 18th March, 1994.
To draw or maintain the inference sought, it would be necessary to identify by what process it was said that the applicant’s Sales Manager Ms. Phillips was influenced or prevailed upon to fabricate claims of unsatisfactory work performance against the applicant, or to impose targets which were more onerous than those applicable to others, or to adopt an attitude to her continued employment that was in some way influenced by the incidents of the 18th March, 1994 and to show why she would have any possible interest in doing such a thing. There is no such evidence in this case which would enable such an inference to be drawn or maintained. The evidence of Ms. Phillips was that the reasons for the termination were as a result of her concerns as to the applicant’s work performance and attitude. I accept the evidence of Ms. Phillips as to the reasons for the termination of the employment.
Secondly in this regard, the evidence of the respondent’s witnesses in the proceeding was that there had been no discussion between the managers as to the incident on 18th March, 1994 in so far as it affected the applicant.
It is clear from the evidence that Mr Thorsen was aware of, and spoke to, Mr. Marks about his conduct towards Ms. Lablache on that evening, however the evidence was that there was no discussion in relation to the applicant. No complaint had been made by the applicant to any person within the company in relation to the alleged conduct other than raising the issue directly with Mr. Marks. No further issue was made of the matter by the applicant or, on the evidence before me, any person within the respondent, and as such I am satisfied that it was not an issue which continued to operate upon the consciousness of the respondent’s managers, or upon the decision makers, Ms. Phillips in particular, in respect of the termination of employment.
Having considered all of the above matters, including my findings of fact herein, I find that the respondent did not terminate the applicant’s employment for the reason of her sex or for reasons including her sex and that there was no contravention by the respondent of S170DF(1)(f) of the Act.
VALID REASON - S170DE(1)
Having regard to my earlier consideration of the facts of this matter, I am satisfied that the concerns expressed by the respondent as to the applicant’s work performance were actual concerns in that regard.
The daily call sheets and the sales information tendered in the proceedings are evidence of the matters which formed the basis for the concerns of the respondent as to the applicant’s work performance (Exhibit L14 and Exhibits G3, G4 and G5). I am satisfied that there had been deterioration in the applicant’s level of performance having regard to the sales information and call sheets referred to above. I am also satisfied that this deterioration was of concern to Ms. Phillips, and that these matters were brought to the attention of the applicant at that time. I further find that the respondent held real concern as to the capacity of the applicant to perform her duties as a sales consultant, having regard to the level of cold-calling involved.
Having regard to all of the above matters, I am satisfied that the respondent did have a valid reason for the termination of the employment of the applicant, which reason was related to the applicant’s capacity and conduct.
Harsh, Unjust or Unreasonable
It was submitted by the applicant that the termination of employment was harsh, unjust and unreasonable because of the failure of the respondent to have regard to the applicant’s personal difficulties, and because the targets which were set were unfair in that they could not be reasonably expected to be reached within the time set.
It was submitted by the applicant that regard ought be had to her evidence as to the reason why the cold-calling was stressful at that particular point in time. Whilst I accept that the respondent did know, or ought reasonably to have known, about the personal problems of the applicant during the period of probation, the fact of their existence, or even a failure to have regard to them, does not of itself constitute the termination as harsh, unjust or unreasonable. In determining what consideration, if any, the employer ought to have given to those personal problems, factors such as the length of the employment and the nature of the employment, ie. permanent, temporary or probationary, are relevant considerations.
It was submitted by the respondent that the degree of flexibility required of an employer in respect of an employee’s work performance increases with the degree of equity that the employee may have established in a job as a result of years of service.
In my view there is some merit in that submission. In circumstances where an employee has established a longstanding pattern of regular and satisfactory work performance, the employer might have regard to this history in assessing appropriate action to be taken in respect of a period of unsatisfactory performance. This would be likely to go to the question of whether or not termination of employment would be harsh, unjust or unreasonable in the circumstances.
Similarly, the fact in this circumstance that the employment was the subject of a probationary period, and that there had already been an extension of that period to enable an attempt to reach adequate levels of sales performance, are relevant considerations in respect of the extent to which there was an entitlement in the employee to expect that the employer would give some latitude because of personal problems. Whilst the applicant’s extended probationary employment did not fall within the operation of the exclusions set out in Regulation 30B(1), it did, in my view, continue to be probationary employment. In my view there was a true extension of the probationary employment in the circumstances of a refusal by the employer to confirm the employment of the applicant as permanent. The respondent clearly advised the applicant to the contrary (Exhibit L5) and instead, with the agreement of the applicant, extended the probationary period.
It was submitted by the applicant that there was only agreement under duress. Whilst it is true that the only alternative if she did not agree was that the applicant’s employment would have been terminated, her failure to agree in those circumstances would have enabled the respondent to exercise its entitlement under the contract in any event, and terminate it.
Had that been done at the time, it is likely that Regulation 30B would have operated to preclude the applicant from the present proceedings. But I am satisfied there was a real and actual benefit to the applicant in the extension of the probation which she agreed to and accepted.
In any event, this is not a case where the employer merely disregarded the illness or difficulties of the applicant. I am satisfied that these difficulties were taken into account by the respondent in deciding that, rather than terminate the employment at the end of the probationary period, it would extend the probationary period. I am also satisfied that even at the meeting with Mr. Thorsen on 8th March, 1994 there was expressed by Mr. Thorsen concern as to the personal problems of the applicant. The applicant’s own evidence supports this finding. In addition, the applicant at least on two occasions took the opportunity to approach senior management in respect of matters of concern to her where she felt she was not being treated fairly by her immediate supervisor. On both of those occasions Mr. Thorsen and Mr. Marks took action to deal with the problem raised by the applicant. I am satisfied that there was significant consideration by the respondent of the applicant’s personal situation and difficulties, and that that consideration in fact resulted in the termination of employment not being effected at the end of the initial probationary period. In my opinion, the respondent accorded the applicant a significant degree of latitude and consideration in applying its performance standards, and did have regard to her personal circumstances in determining whether to terminate the employment.
One further issue raised in these proceedings was the fact that the applicant was friendly with another member of staff, Ms. Lablache, who bore significant resentment towards Ms. Phillips. This resentment arose as a result of the latter’s appointment to the position of Sales Manager and the consequent relationship with staff. I am satisfied that Ms. Lablache conducted herself in a manner which ensured the least amount of cooperation with the Sales Manager. I am also satisfied that notwithstanding the fact that Ms. Phillips held the position of Sales Manager prior to the applicant commencing employment, this same approach was to some extent adopted by the applicant in her dealings with Ms. Phillips and created difficulty between them and difficulty for Ms. Phillips in administering the sales team.
The applicant in cross-examination expressed the view that Ms. Phillips wanted her out, and that the targets set by her were set with a view to ensuring she would not be able to reach the standard set. This is despite the fact that the target dates, and consequently the probationary period, were extended on two occasions, on one occasion at the request of the applicant. The applicant gave evidence that she felt that the Branch Manager, Mr. Thorsen, was supportive of her at all times.
It is clear that there was a belief in the applicant that Ms. Phillips had decided to ‘get rid of her’, whatever she achieved. I am not satisfied that this was the case, and am of the view that the evidence reveals nothing other than a frustration in Ms. Phillips with what she perceived to be a lack of cooperation by the applicant with her as Manager, and dissatisfaction
with the sales performance of the applicant.
When looked at chronologically, it is clear that the respondent did in fact accord the applicant a period of some 16 days beyond the expiration of initial probationary period to satisfy it that she was able to perform the duties at the level required, and in the manner required, by the respondent. I am satisfied that the criteria imposed by the respondent to evaluate this was fair having regard to the sales levels of other consultants in the branch, and that the time frames involved were fair and not oppressive.
Having regard to these matters, I am not satisfied that the termination of the applicant was harsh, unjust or unreasonable, and consequently I find that the respondent has not contravened S170DE(2) of the Act.
The application is dismissed.
I certify that this and the preceding twenty-one (21) pages
are a true copy of the reasons for judgment of
Judicial Registrar Parkinson.
Associate:
Date: 11 November 1994
Solicitors for the Applicant: Maurice Blackburn & Co
Counsel appearing for the Applicant: Ms. L. Gyfteas
Solicitors for the Respondent: Phillips Fox
Counsel appearing for the Respondent: Mr. B. Lacy
Dates of hearing: 7,10,11,12 October 1994
Written submissions: 24 October 1994
Date of judgment: 11 November 1994