Fahim Ahmadyar v Visy Board Pty Limited T/A Visy Board

[2017] FWC 6463

[2017] FWC 6463

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Fahim Ahmadyar
v
Visy Board Pty Limited T/A Visy Board
(U2017/9326)

Ulben Rustemovski v Visy Board Pty Ltd T/A Visy Board (U2017/9857)
COMMISSIONER BISSETT	MELBOURNE, 11 DECEMBER 2017

Application for relief from unfair dismissal – directions set aside.

[1] Mr Fahim Ahmadyar and Mr Ulben Rustemovski (the Applicants) were employed by Visy Board Pty Limited t/a Visy Board (Visy or the Respondent). They were dismissed on 7 August 2017 and 23 August 2017 respectively. Each was dismissed for “organising unlawful industrial action at the Visy Board Dandenong site in the form of overtime bans on afternoon and day shifts from Monday 24 July to Wednesday 26 July [2017].” 1

[2] The decision was apparently taken after an investigative process which included discussions with “a number of others in the workplace.” The letters of termination said that the denial of the Applicants was “inconsistent with the accounts…received from other employees who witnessed your conduct at the relevant times.” 2

[3] Each of the Applicants has made an application to the Fair Work Commission (Commission) pursuant to s.394 of the Fair Work Act 2009 (FW Act) seeking relief from unfair dismissal. Neither matter settled at conciliation. Directions were subsequently issued in each matter.

[4] On 5 October 2017 the Applicants’ representative requested that the Commission vacate the directions made in relation to each application pending the conclusion of a civil penalty proceeding in the Federal Court (the Federal Court matter) in relation to the alleged unlawful industrial action. The Respondent did not agree to the adjournment request.

[5] The application for an order vacating the directions was subject to a Mention before me. Given the complexity of the matter I granted permission to the Applicants and Respondent to be represented by lawyers. I also directed that further written submissions with respect to the application to vacate be made.

Background to the application to vacate directions

[6] It is generally agreed that:

•  Each of the Applicants was dismissed for serious misconduct constituted by his role in organising unlawful industrial action;

•  Prior to the termination of the Applicants’ employment the Respondent instituted proceedings in the Federal Court of Australia 3 against the AMWU, Mr Michael Bull (a union official) and 69 of its employees (the named employees) employed at the site but excluding the Applicants;

•  In the Federal Court proceedings Visy claims that the Respondents to those proceedings contravened a number of civil penalty provisions of the FW Act by organising and/or engaging in strike action and organising and/or imposing overtime bans;

•  By the statement of claim filed in the Federal Court Visy alleges that the Applicants in the unfair dismissal matter “directed, authorised and/or organised employees…to not work allocated overtime…”;

•  The Applicants have applied for an adjournment of the unfair dismissal application because of concern they will be denied natural justice by being denied a fair and reasonable opportunity to present their cases to the Commission because of the operation of the privilege against self-incrimination in relation to the Federal Court proceedings. 4

Privilege against self-incrimination

[7] I do not intend to traverse authorities on the privilege against self-incrimination. I accept, on the basis of the material filed by the Applicants, that it does exist and is a relevant consideration in the matter before me.

[8] Further, the privilege is available to proceedings involving civil penalty provisions 5 and hence is applicable to the matter before the Commission as it relates to or has some connection with the Federal Court proceedings brought by the Respondent.

Principles for a stay of unfair dismissal proceedings

[9] The principles in relation to an application for stay in civil proceedings are outlined by Wootten J in McMahon v Gould 6 (McMahon)wherehis Honour said:

I approach the decision in this matter with the following guidelines:

(a) Prima facie a plaintiff is entitled to have his action tried in the ordinary course of the procedure and business of the court (Rochfort v John Fairfax & Sons Ltd at 19);

(b) It is a grave matter to interfere with this entitlement by a stay of proceedings, which requires justification on proper grounds (ibid);

(c) The burden is on the defendant in a civil action to show that it is just and convenient that the plaintiff's ordinary rights should be interfered with (Jefferson v Bhetcha at 905);

(d) Neither an accused (ibid) nor the Crown (Rochfort v John Fairfax & Sons Ltd at 21) are entitled as of right to have a civil proceeding stayed because of a pending or possible criminal proceeding;

(e) The court's task is one of “the balancing of justice between the parties” (Jefferson Ltd v Bhetcha at 904), taking account of all relevant factors (ibid at 905);

(f) Each case must be judged on its own merits, and it would be wrong and undesirable to attempt to define in the abstract what are the relevant factors (ibid at 905);

(g) One factor to take into account where there are pending or possible criminal proceedings is what is sometimes referred to as the accused's “right of silence”, and the reasons why that right, under the law as it stands, is a right of a defendant in a criminal proceeding (ibid at 904). I return to this subject below;

(h) However, the so-called “right of silence” does not extend to give such a defendant as a matter of right the same protection in contemporaneous civil proceedings. The plaintiff in a civil action is not debarred from pursuing action in accordance with the normal rules merely because to do so would, or might, result in the defendant, if he wished to defend the action, having to disclose, in resisting an application for summary judgment, in the pleading of his defence, or by way of discovery or otherwise, what his defence is likely to be in the criminal proceeding (ibid at 904-5);

(i) The court should consider whether there is a real and not merely notional danger of injustice in the criminal proceedings (ibid at 905);

(j) In this regard factors which may be relevant include:

(i) the possibility of publicity that might reach and influence jurors in the civil proceedings (ibid at 905);

(ii) the proximity of the criminal hearing (ibid at 905);

(iii) the possibility of miscarriage of justice eg by disclosure of a defence enabling the fabrication of evidence by prosecution witnesses, or interference with defence witnesses (ibid at 905);

(iv) the burden on the defendant of preparing for both sets of proceedings concurrently (Beecee Group v Barton);

(v) whether the defendant has already disclosed his defence to the allegations (Caesar v Somner at 932; Re Saltergate Insurance Co Ltd at 736);

(vi) the conduct of the defendant, including his own prior invocation of civil process when it suited him (cf Re Saltergate Insurance Co Ltd at 735-6);

(k) The effect on the plaintiff must also be considered and weighed against the effect on the defendant. In this connection I suggest below that it may be relevant to consider the nature of the defendant's obligation to the plaintiff;

(1) In an appropriate case the proceedings may be allowed to proceed to a certain stage, eg, setting down for trial, and then stayed (Beecee Group v Barton).

[10] This, along with a number of other authorities on the issue, was reviewed in Websyte Corporation Pty Ltd v Alexander (No 2) 7(Websyte). In that matter Dodds-Streeton J held that:

[115] While McMahon v Gould, unless authoritatively re-evaluated, remains applicable, Wootten J did not purport to establish a rigid code, but expressly recognised that the relevant considerations will vary according to the individual case and that his guidelines were not exhaustive. It is also important to observe that Wootten J did not suggest that potential impact on the privilege against self-incrimination was irrelevant in this context. His Honour expressly recognised that the right of silence and the reasons for that right (emphasis added) in a criminal trial, were relevant to a stay of civil proceedings. His Honour went on to observe that the right of silence had both legitimate rationales and illegitimate consequences and courts should not be concerned to preserve the latter in exercising its discretion to stay civil proceedings. He stated that the civil proceeding should not be stayed merely (emphasis added) because the defendant (if he wished to defend) would have to disclose his probable defence in the criminal action.

[116] Wootten J thus concluded that potential compromise of the right of silence in the criminal proceeding by disclosure of the defence in the civil proceeding (where this could deprive the defendant of tactical advantages of the right of silence in the criminal proceeding) would not automatically, in itself,justify a stay. His Honour did not exclude, however, as a consideration favouring a stay, a risk of prejudice in criminal proceedings constituted by impact on legitimate goals of the right of silence or the privilege against self-incrimination. His Honour did not state that the impact on the right of silence by way of witness statements or evidence at trial was not a relevant consideration favouring a stay. Indeed, Wootten J recognised that it may be appropriate to stay the civil proceeding at the point of setting the matter down for trial.

[117] The “real risk of injustice” relevant in this context can relate either to an actual or potential criminal proceeding. In the present case, most significantly, a proceeding under s 247G of the Crimes Act is already on foot, apparently commenced in time to meet limitations requirements. In my view, further proceedings, particularly charges under the Copyright Act, although not yet commenced, are “on the cards” in the sense that they are reasonably possible.

[11] The principles in McMahon have been applied in a number of decisions in the Commission where a stay of proceedings in the Commission have been sought pending the resolution of criminal proceedings.

[12] In Sanford v Austin Clothing Company Pty Ltd trading as Gaz Man 8 Senior Deputy President Watson said:

[31] ...The respondent is prima facie entitled to have the matter determined as quickly as practicable. An adjournment should not be lightly entertained. The onus to make good the adjournment application lies with the applicant for the adjournment. The applicant is not entitled, of right, to an adjournment in light of the criminal proceedings. Each application for adjournment must be made on its own merits and balance the interests of the parties.

[32] Where there are pending criminal proceedings the accused’s “right of silence” is a relevant consideration, however the so-called “right of silence” does not extend to give such a defendant as a matter of right the same protection in contemporaneous civil proceedings. In the case of Philippine Airlines v Goldair, Young CJ concluded at page 386 that:

“The right of silence is a right which relates to criminal proceedings and it would need a very strong case before the Court should intervene solely on that ground to stay civil proceedings pending the determination of criminal proceedings.”

[33] Injustice to a defendant in the criminal proceedings is a relevant consideration in considering competing interests of the parties, but it must be a real and not merely notional danger.

[13] In that matter his Honour concluded:

[35] I am not satisfied that a very strong case has been established for these proceedings to be adjourned or stayed until the determination of the criminal proceedings, or for revoking the directions issued on 28 May 2000. I am not satisfied that a case has been made out to prevent determination of the present matter in the normal course. On what has been put to me, I am not satisfied that there is a real danger of injustice to the applicant if the present matter proceeds to arbitration in the normal course. To paraphrase the conclusions of Young CJ in Philippine Airlines, ifthe allegations of conduct substantiating a valid reason for termination are groundless, no injustice would accrue to the applicant in respect of the criminal proceedings if he were to say so now. The Commission, in determining whether the termination was harsh, unjust or unreasonable, will be required to make findings, on the balance of probabilities, as to whether or not conduct occurred which constituted a valid reason for termination. I have not been satisfied as to how such a finding, or the giving of evidence in relation to it, would create an injustice for the applicant in defending criminal charges to be determined beyond reasonable doubt.

[14] In Howarth v Mornington Peninsular Shire Council 9Commissioner Whelan, on applying the principles in McMahon concluded that she was:

[28] …not satisfied that a very strong case has been established for these proceedings to be stayed, either indefinitely, until the determination of the criminal proceedings, until the mention, or until the applicant can further deal with the material that has been submitted by the respondent.

[15] More recently Deputy President Gooley in Morton v Lardner Mechanical Repairs Pty Ltd, 10 after considering the matters in the application before her against the principles in McMahon, said:

[20] I have determined that this matter should be heard and determined. I do so because it is unlikely that the County Court will hear and determine the matter in the near future. I also do so because the Commission and the Court will be asked to determine different issues. The Court will need to determine if Ms Morton has misappropriated funds. The Commission will need to determine if the dismissal was harsh unjust or unreasonable. That the Court may find Ms Morton did not misappropriate funds does not mean that the dismissal was harsh, unjust or unreasonable.

[16] In French v The Good Guys Discount Warehouse (Australia) Pty Ltd T/A Good Guys O’Connor 11 (French) Deputy President Bull declined to grant a stay sought by the respondent in that matter. In that case the applicant’s union had commenced proceedings in the Federal Court alleging a breach of the general protections provisions of the FW Act and seeking pecuniary penalties on the grounds that a representative of the respondent had prevented the applicant being represented by his union in the meeting which led to the termination of employment. The respondent “hived off”12 (by the stay application) that part of the unfair dismissal proceedings that related to the Federal Court matter.

[17] Deputy President Bull declined the application, in part because there were others at the meeting where representation was denied who were not named in the Federal Court proceedings who could testify to the matter in the unfair dismissal proceedings.

[18] In Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd 13 the respondent sought a stay of the hearing of a dispute pending a decision as to whether the Industry Health and Safety Representative would recommend a prosecution pursuant to relevant mine health and safety legislation. Deputy President Asbury applied the principles in McMahon and accepted that there was a “real risk of injustice in the potential criminal proceedings if BHP’s managers give evidence in the dispute on the basis that any evidence those persons give may well be relevant to any future criminal prosecution.”14 The Deputy President concluded that “the risk of injustice for BHP and its managers if the disputes proceed is greater that the prejudice to Mr Thomson if there is a delay in dealing with them…”15 For this reason she granted the stay. Whilst the Order arising from that decision was set aside on appeal, the reasoning of the Deputy President was not disturbed.

Statutory framework

[19] There is no doubt that the Commission has the power to adjourn a matter by vacating directions issued (effectively grant a stay on proceedings) and I do not understand this to be an issue between the parties.

[20] The consideration of the application before the Commission must be undertaken within the statutory framework for dealing with applications for relief from unfair dismissal.

[21] The unfair dismissal provisions are found in Part 3-2 of the FW Act. The objects of Part 3-2 are at s.381 of the FW Act. They state:

381 Object of this Part

(1) The object of this Part is:

(a) to establish a framework for dealing with unfair dismissal that balances:

(i) the needs of business (including small business); and

(ii) the needs of employees; and

(b) to establish procedures for dealing with unfair dismissal that:

(i) are quick, flexible and informal; and

(ii) address the needs of employers and employees; and

(c) to provide remedies if a dismissal is found to be unfair, with an emphasis on reinstatement.

(2) The procedures and remedies referred to in paragraphs (1)(b) and (c), and the manner of deciding on and working out such remedies, are intended to ensure that a “fair go all round” is accorded to both the employer and employee concerned.

[22] It is therefore necessary to consider the current application and to apply the principles outlined above within a framework that recognises and balances competing needs, does not introduce unnecessary delay but provides for a fair go all round in its process.

[23] I take from this a need to ensure, in my decision, that the Applicants are given every reasonable opportunity to present their best defence against the reasons for dismissal whilst ensuring the applications are not unreasonably delayed.

Submissions

Applicants

[24] The Applicants’ cases are that if the stay is not granted they will be denied natural justice “by being denied a fair and reasonable opportunity to present their cases to the Commission because of the operation of the privilege against self-incrimination in relation to the Federal Court proceedings.” This operates at two levels. First they say that it arises in relation to each of them giving their evidence and second, it arises in relation to employees they may wish to call as corroborating witnesses.

[25] The representative of the Applicants says that the Applicants accept that any delay in accessing potential entitlements under the FW Act is due to their own application for a stay and they accept the consequences of this.

[26] The Applicants contend that they are in danger of being sued for a civil penalty if they give evidence in their own defence which incriminates them “either directly or derivatively.” Further they submit that employees of Visy who they may wish to call as witnesses to corroborate their claims would clearly be “exposed to self-incrimination in the Federal Court proceedings” if they give evidence and are subject to cross-examination. There is therefore “a real danger of injustice in the Federal Court proceedings” if the unfair dismissal applications proceed at this point in time.

[27] The Applicants further submit that they had no option on the timing of their applications for unfair dismissal given the statutory requirements that such an application be made with 21 days of the date the dismissal took effect. They therefore could not have reasonably delayed their applications for relief from unfair dismissal until after the determination of the Federal Court matter.

[28] In relation to potential corroborating witnesses Ms Nicole Spicer, of Stary Norton Halphen lawyers who is representing the 69 named employees in the Federal Court proceedings, has advised the representative of the Applicants in the unfair dismissal matters that she would be advising her clients against giving evidence in the unfair dismissal proceedings on the grounds that they may incriminate themselves in relation to the Federal Court proceedings.
[29] The Applicants distinguish their situation from that in the decision in French. In this matter the Applicants say they must give evidence in support of their application whilst in French there were others beside Ms Borovica who could give relevant evidence who were not exposed to Federal Court proceedings.

[30] The Applicants submit that, to deny the application to vacate, would be to deny them a reasonable opportunity to present their cases 16 by placing them in jeopardy of self-incrimination but also by denying them corroborating witnesses.

Respondent

[31] The Respondent accepts that it bears of the onus of proving that it had a valid reason for the dismissal of the Applicants. In this respect it says that (while it does not intend to call them) if the Applicants call any of the employee respondents in the Federal Court proceedings the issue before the Commission will not be if the witnesses engaged in unlawful industrial action but if the Applicants organised such action. In this respect it says that there is only a remote connection between matter before the Commission and the Federal Court matter.

[32] The Respondent says that, whilst the circumstances before the Commission in this matter are not common, the concerns of the AMWU should not be afforded any weight. Of this it says that evidence from the Applicants (if given) that they did organise unlawful industrial action will only support the claim Visy has against the AMWU in the Federal Court as it says the Applicants acted as officers or agents of the AMWU (and, by implication, not against the named employees).

[33] The Respondent says that it will suffer unreasonable prejudice if the stay is granted. It says that witnesses it may call are entitled to have the matter resolved and that the witnesses may be marginalised in the workplace if they are known or suspected of supporting the Respondent. Further it says that the Applicants are seeking reinstatement and it is entitled to have this resolved as soon as possible. It says that an unfair dismissal where the remedy sought is reinstatement suggests a matter should be heard “sooner rather than later”. 17

[34] The Respondent submits that the balance of justice is against the grant of the application for a stay.

Consideration

[35] That I have not heard direct evidence from the Applicants as to the prejudice they believe they will suffer or as to their understanding of effect of the grant of the application to vacate may have on the unfair dismissal applications is not relevant. The Applicants are represented and there is no basis to consider they have not been properly advised by their lawyer.

[36] Further, beyond the general prejudice to the Respondent of a delay in hearing the unfair dismissal applications, vague claims of unnamed persons who may be witnesses being marginalised in the workplace are difficult to realistically assess. Further, that union delegates may change it seems to me is part of business and does not create any prejudice to the Respondent.

[37] I do not consider it relevant that the Respondent may not call the named employees in the Federal Court proceedings as witnesses in these proceedings (although I note that the Respondent qualifies this by saying it has no intention to do so “at this time” leaving the option well open to it). The Applicants may seek to call such witnesses and this cannot be ignored.

[38] I do not consider that some injustice may arise to the named employees in the Federal Court proceedings provides grounds to stay the applications. This application is not made on behalf of the named employees in the Federal Court matter – the injustice in the application to vacate directions in the unfair dismissal proceedings must be directed to the parties in the unfair dismissal proceedings. I am satisfied however that the potential implications for the named employees in the Federal Court proceedings does affect this matter as it may limit the capacity of the Applicants to mount a sound defence against the reasons for their dismissal. An injustice arises in this way to the Applicants in the unfair dismissal.

[39] I do accept that it is important that, where an applicant in an unfair dismissal matter seeks reinstatement, this should be determined as quickly as possible. This however needs to be balanced against other competing interests raised by the application to vacate.

[40] It cannot be held against the Applicants that they have made their application for unfair dismissal within time. There is, otherwise, no guarantee that an application made late would be accepted by the Commission an extension of time within which to make an application for unfair dismissal being a discretionary decision of the Commission.

[41] The Applicants have not been in control of the timing of their unfair dismissal applications or the Federal Court proceedings. I am not convinced they should be subject to potential injustice because of that timing. It is, in this respect, unfortunate that the facts in the unfair dismissal case are inextricably bound up in the facts in the Federal Court proceedings but this is of the Respondent’s doing and the Applicants should not be disadvantaged by this.

[42] This is an unusual case. The Applicants have not been named in the Federal Court proceedings yet the conduct for which their employment was terminated is highly relevant in the Federal Court proceedings as is evident from the statement of claim of Visy in that matter.

[43] Further, regardless of the stated intention of Visy that it does not intend to commence civil penalty provisions against the Applicants, this does not grant the Applicants immunity from such proceedings as proceedings may be instigated by, for example, the Fair Work Ombudsman. This may lead to an injustice for the Applicants in that, in giving evidence in their unfair dismissal hearing, they may expose themselves to penalty provisions of the FW Act.

[44] The Applicants in this matter have had their employment terminated “for organising unlawful industrial action”. A potential finding, in determining if the conduct complained of occurred (and hence if there was a valid reason for dismissal), is that the Applicants can only have organised unlawful industrial action if industrial action was taken and it was not properly protected. Whilst the Applicants deny the conduct it seems to me inevitable that the Commission, in deciding if the dismissal was harsh, unjust or unreasonable, may need to consider if the action organised was not protected. In doing so, the Commission may be required to decide if employees of the Respondent took unprotected industrial action. The named employees in the Federal Court proceedings will have evidence I would have thought highly relevant to such a matter.

[45] Given that the named employees have been advised not to give evidence in the unfair dismissal matter on the grounds that they may incriminate themselves, this may lead to an injustice for the Applicants in that it may adversely affect their ability to put forward a robust case in the unfair dismissal hearings.

[46] If the allegations of misconduct, organising in unlawful industrial action, are groundless, no injustice will accrue to the Applicants. This weighs against the grant of the stay. However, in this case, the Applicants may not be able to mount such a defence as the witnesses on whom they seek to rely have indicated that they will not give evidence on the grounds that it may incriminate them.

[47] In reaching my decision I have also taken into account the need to ensure a “fair go all round” is afforded to both the employer and employees. This applies as much to procedure as to other matters relevant in an unfair dismissal. In this respect the Respondent has not convinced me that it would be denied “a fair go” if the application to vacate directions was granted. I consider that any injustice arising directly from the grant of the application to vacate directions will accrue to the Applicants but they have sought that the directions be set aside.

[48] I have also taken into account the potential delay in dealing with the unfair dismissal matters pending the Federal Court matter. Whilst this is regrettable there is no evidence that the delay will be substantial, noting that mediation dates have apparently been set.

[49] For these reasons, and on balance, I am satisfied that an injustice will accrue to the Applicants such that the application to set aside the directions in the unfair dismissal applications should be granted.

[50] An order 18 to this effect will be issued with this decision.

COMMISSIONER

Appearances:

G. Borenstein for the applicants

A. Farr for the respondent.

Hearing details:

2017.

Melbourne (by telephone):

October 12.

Written submissions:

Applicant: 12 and 27 October 2017.

Respondent: 20 October 2017.

 1   See letters of termination of employment attached to the Form F2 of each Applicant.

 2   Ibid.

 3   Matter number VID 842/2017.

 4   See paragraphs 2-10 of Applicants’ submission of 12 October 2017 and paragraph 2 of Respondent’s submission dated20 October 2017.

 5   Pyneboard Proprietary Limited v Trade Practices Commission and Another (1983) 152 CLR 328 [15], per Mason ACJ, Wilson and Dawson JJ. See also Griffin v Pantzer [2004] FCAFC 113 [42]-[46].

 6 (1982) 7 ACLC 202.

 7 [2012] FCA 562.

 8   Print S8287.

 9   Print S0138.

 10   [2016] FWC 3982.

 11   [2017] FWC 3545.

 12   Ibid, [7].

 13   [2014] FWC 9205.

 14   Ibid, [29].

 15   Ibid, [30].

 16   See Re Australian Railways Union and Others; v Public Transport Corporation (1993) 117 ALR 17 at 23-24.

 17   See National Union of Workers – New South Wales Branch v Belan[2017] FWC 1439, [19].

 18   PR598575.

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