Frank Muscat v Department of Human Services Disability Accommodation Services Eastern Region

[2014] FWC 1925

[2014] FWC 1925

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.739—Dispute resolution

Frank Muscat
v
Department of Human Services Disability Accommodation Services Eastern Region
(C2013/3543)

COMMISSIONER GREGORY MELBOURNE, 23 APRIL 2014

Alleged dispute concerning disciplinary action.

Introduction

[1] Mr Frank Muscat has been employed by the Department of Human Services (DHS) since 1995. He last worked as a Disability Development and Support Officer. In August 2011 an investigation was initiated into an incident involving an allegation he had fallen asleep while at work. Following the incident he was initially suspended on full pay while an investigation took place. He then went on a period of paid leave pending the outcome of the investigation.

[2] Mr Muscat is still employed by the DHS. However, since the events of August 2011 he has not returned to work. He has subsequently been in dispute with the DHS about various matters relating to that incident and made application to the Commission early in 2013. However, the DHS raised a jurisdictional objection to that application on the basis the matters in dispute were not matters that arose under the terms of the Agreement that covers the parties, or alternatively under the National Employment Standards. The Commission subsequently handed down a decision on 11 September 2013 dealing with that matter. The decision stated in part at [13] (references omitted):

“The parties are clearly in dispute about whether Mr Muscat was directed to take leave while the allegations involving his conduct were being investigated. The dispute settling procedure in the Agreement (clause 13) sets out the procedures for dealing with ‘a dispute or grievance about a matter arising under this Agreement...’ It provides for the matter to be referred to the Commission if it has not been able to be resolved in the workplace. Clause 6 of Schedule C also contains a range of provisions dealing with what is to occur when an allegation of serious misconduct is being investigated, including sub-clause 6.2(e) which states:

‘(e) where the Employee is directed to take accrued leave, and the disciplinary outcome applied is not termination of the Employee’s employment, then the leave taken shall be re-credited to the Employee’” 1

[3] The decision continued to indicate at [15]:

“I am satisfied that Mr Muscat is in dispute with his employer about his leave entitlements while being investigated in regard to an allegation of serious misconduct and that the dispute concerns a ‘dispute or grievance about a matter arising under this Agreement,’ being the Agreement that covers the parties. I am, in turn, satisfied the Commission has jurisdiction to deal with the dispute.” 2

[4] The decision continued to indicate that having come to this conclusion the issue in dispute would be resolved in accordance with the dispute settling procedure in the Agreement. It was therefore dealt with initially in a conference between the parties, but was unable to be resolved in those discussions. Mr Muscat subsequently requested it be referred for determination by arbitration under sub clause 13.8 of the disputes procedure in the Agreement. This decision accordingly deals with that application.

The Issue to be Determined

[5] The parties are covered by the HACSU Department of Human Services Disability Services Enterprise Agreement 2008 – 2012 3. Schedule C to that Agreement deals with “Unsatisfactory Performance and Discipline Procedure.” As indicated above Clause 6 “Serious Misconduct Stream” in the Schedule states at sub clause 6.2 (e):

“where the Employee is directed to take accrued leave, and the disciplinary outcome applied is not termination of the Employee's employment, then the leave taken shall be re-credited to the Employee” 4

[6] Action was taken against Mr Muscat in regard to the events of August 2011 in accordance with clause 6 of the Agreement. However, the outcome of that process did not result in termination of his employment. It was instead determined it was not appropriate for him to continue to be employed on the “active night shift,” as it is described, and he should instead be relocated to work elsewhere on either a day or afternoon shift. However, Mr Muscat claims that during this process he was directed to take accrued leave and therefore this leave should be re-credited to him in accordance with sub clause 6.2(e) in Schedule C because he was not terminated. However, the DHS denies he was ever directed to take accrued leave but, instead, elected to do so. Therefore, it submits there is no obligation for any leave to be re-credited.

[7] Therefore, the issue to be determined is whether Mr Muscat was directed to take accrued leave by the DHS, following the events of August 2011, or whether he elected or otherwise chose to do so?

The Submissions and Evidence

[8] A range of matters have been raised and canvassed in these proceedings. Not all of them are relevant to the issue to be determined. In accordance with the earlier decision referred to above I again made clear at the commencement of the hearing that “...in essence what these proceedings are about is whether Mr Muscat was directed or whether he elected to take accrued leave at some time after August 2011.” 5 I have accordingly sought to confine any references in this decision to the evidence and submissions I consider relevant to the determination of that matter.

[9] Mr Muscat states that on 31 August 2011 he was told, following a complaint made about him by another staff member, that he was to be suspended for 2 nights on full pay while the complaint was investigated. It was also indicated alternate duties would be found for him in the meantime. This discussion was with Mr Todd Keating, the Operations Manager, and the complaint concerned an allegation of falling asleep during his shift. Mr Muscat subsequently received a letter dated 2 September from Ms Heather Ackerley, indicating he would be suspended on full pay effective 31 August 2011.

[10] In subsequent discussions with Mr Keating on 3 September Mr Muscat told him he was unwell. He said Mr Keating then recommended he provide a medical certificate concerning this situation. Mr Muscat says he questioned why this was required if he was suspended with pay, but received no response from Mr Keating. He said he had a further conversation that day with Ms Kathy Hope from the HR Department. He said:

“We discussed the letter and my confusion over being told to use leave whilst I was suspended with pay. I told Ms Hope that Mr Keating recommended I change my recreation leave to sick leave. I was under the impression Ms Hope was just as confused as I was, as to why I was required to use any type of leave when I was suspended with pay.” 6

[11] He said he then received a further letter dated 9 September from Ms Ackerley setting out the allegations made against him. It also stated Mr Keating had informed the DHS that Mr Muscat had elected to take recreation leave during this period, however, Mr Muscat denies this. He also states the action taken by the DHS in response to the events of August 2011 caused him stress and anxiety and he has since been diagnosed with “an Adjustment Disorder” 7. He stated:

“A further concern adding to my anxiety was that I was not actually on suspended pay when I had been told I was suspended. I was concerned that I would not be paid at all unless I provided medical certificates. I discussed making a Work Cover Claim with my doctor.” 8

[12] He later contacted Mr Keating in writing on 27 September 2011 to ask for assistance in completing a WorkCover claim form as he had been told not to attend his former workplace. He said Mr Keating told him to collect a claim form from the post office and he mailed the completed form to Mr Keating on 10 October 2011.

[13] On 18 January 2012 Mr Muscat was advised about the final outcome of the disciplinary investigation and a proposed reassignment of his duties. This correspondence also indicated the DHS would be in further contact shortly to discuss his return to work. However, Mr Muscat said he then received a further telephone call from Ms Ackerley on 29 January about this letter and he:

“...informed Ms Ackerley that I was medically unfit to return to work, and required her assistance in accessing my long service leave, so I would not be financially disadvantaged.” 9

[14] He was contacted again by Mr Rene Labaro from the DHS on 21 March 2012 about arrangements for his return to work and was told two possible options were available. However, he indicated in response he was still unwell and unable to return to work. He followed that discussion with an email response dated 21 March which indicated in part:

“I responded that it is up to you to do as you are instructed as long as you were aware of my circumstances. I reminded you on Thursday that I am still unwell to return to work. I did let you know that I was advised by Debra Smith from Work Cover Unit to keep sending my certificate of capacity as I have the option to appeal to the courts, and I will be seeking grievance with the help of my legal advisor. I am only using my Rec Leave and Long Service Leave until sometime in August, so I am not financially disadvantaged. Officially I am still unwell indefinitely.” 10

[15] Mr Muscat also stated in cross-examination about his discussions with Mr Keating on 31 August:

“All I remember is that he recommended I take rec leave because he couldn't find a day and afternoon shift at short notice and he said he will contact me back on the Friday or the Monday which he never did. That's all I remember.” 11

[16] He also said of that discussion and the suggestion he be re-assigned to other duties:

“In response to that statement I was not directed and I didn't elect to take rec leave. It was recommended by him to take rec leave.” 12

[17] Mr Muscat also submits he should have been paid whilst on suspension until a formal offer of alternate employment was put to him. He should accordingly be re-credited with any leave entitlement used during this period. However, he also submits he should continue to be paid up to the present time because to this point, “he’s still in limbo” in terms of his position with DHS. 13

[18] The DHS submits that Mr Muscat was initially suspended from 31 August 2011 until 2 September 2011, and then commenced accessing his accrued leave entitlements from 5 September, after being advised he would be required to work at an alternate location, but declining to do so. It submits Mr Muscat is not entitled to have leave reinstated.

[19] The DHS also submits any review of the disciplinary outcome resulting from the incident in August 2011 that led to Mr Muscat being suspended is outside the scope of these proceedings. However, it submits, in any case, that outcome was consistent with the requirements of Schedule C of the Agreement. It could, in fact, have decided to terminate Mr Muscat’s employment, but decided instead upon what it describes as “...the gentler outcome of a final warning and reassignment of duties...” 14 It also submits the Commission has no jurisdiction to make a monetary order to reinstate wages, nor does the Agreement provide any mechanism for making such an order.

[20] Mr David Todd Keating is an Operational Manager, Residential Client Services, East Division with the DHS and has worked for the Department for approximately 23 years. He is generally known as Mr Todd Keating. He stated that after becoming aware of the “sleeping allegation” involving Mr Muscat he spoke to him on Wednesday, 31 August 2011 and told him he would be suspended from active night duties immediately, and would soon be directed to work at another group home on day or afternoon shifts. Mr Keating said this outcome was confirmed in a letter to Mr Muscat dated 2 September 2011 from Heather Ackerley, Manager, Disability Accommodation Services at DHS, which indicated in part:

“Accordingly, I direct you to be suspended from duty with pay with effect from 31 August 2011 and your pay will be adjusted to reflect that you have been directed not to attend the workplace and the usual method is for an average to be applied. This decision can be reviewed at any stage of the process and may result in a direction that you work from an alternate location.” 15

[21] Mr Keating indicated he would be in further contact with Mr Muscat later that week about these new working arrangements, however, Mr Muscat told him he was not prepared or was unable to work morning or afternoon shifts.

[22] Mr Keating was again in contact with Mr Muscat on either Friday, 2 September 2011 or Monday, 5 September 2011. Mr Muscat again told him he would not work morning or afternoon shifts. He then discussed other possible options and said Mr Muscat then told him he would prefer to take recreation leave. Mr Keating subsequently advised the payroll office of this situation. On 7 September 2011 Mr Keating said he was told by Ms Kathy Hope, a Senior Workplace Consultant with the DHS, that she had spoken with Mr Muscat and he appeared to be a little confused, and said he had been told by Mr Keating to take sick leave because there were no alternate duties available. Mr Keating said he did not tell Mr Muscat this and decided to speak with him again. He did so, and understood that the situation had been clarified with Mr Muscat after this conversation. He said Mr Muscat received confirmation of this outcome in a further letter from Ms Ackerley dated 9 September 2011, which stated in part:

“Due to the nature of the allegations, it has been assessed that having you continue to undertake active night shifts could negatively impact on the department’s duty of care obligations. As discussed with Mr Todd Keating, Operational Manager on 31 August 2011, you were directed to a temporary reassignment of alternative duties working day and evening shifts. However you advised Mr Keating that you were not able to work the alternative duties offered and that you elected to take recreation leave as an alternative.” 16

[23] Mr Keating said he later received an email from Mr Muscat on 1 December 2011 which indicated his WorkCover claim had been rejected, and once his recreation leave entitlements had been exhausted he intended to use his sick leave entitlements.

[24] Ms Kathy Hope is a Senior Workplace Relations Consultant with the DHS and stated she had a conversation with Mr Muscat on 7 September 2011, in which he seemed confused about his current situation and the alternative duties being offered to him. She passed this information onto Mr Keating and Ms Ackerley. Mr Keating sent an email to her the following day which stated in part:

“I advised Frank that he would be paid for his shifts on 31/8 & 1/9 and that his next shift on Monday 5/9 and ongoing would be at an alternate location. Frank said that he couldn’t and wouldn’t do morning or evenings. After some more discussion around this wasn’t an option of choice, Frank said he would like to take rec leave for a few weeks. I said it was his choice to take leave instead of alternate duties, I’d confirm with him shortly.

In my discussion with Frank yesterday, Frank said he had taken sick leave for 2 days, and 3 days of sub leave. He was going to see his doctor as he was now feeling stressed and anxious. I informed Frank that his rec leave could be changed to sick leave after he had a certificate. Frank was seeing his doctor this Thursday and going to forward the certificate to me.

The conversation was not unpleasant and Frank was appreciative of the call and discussion.

At no stage did I say he would have to take sick leave as there were no other duties. I was clear in saying that we did have other duties for him. It is Frank who has chosen to take leave.” 17

[25] DHS also submits that the wording in Schedule C in the Agreement is a quite specific. Sub clause 6.2(e) refers to a circumstance where an employee is “directed” to take accrued leave. In its submission there has never been any direction from the Department, even on the basis of Mr Muscat’s evidence and submissions. He has only used words such as “recommended” or “advised”. In its submissions there has never been any direction from the DHS to Mr Muscat to take or use his accrued leave entitlements. It further submits that any discussion about taking accrued leave only arose after Mr Muscat indicated he would not be prepared or able to take on any of the reassigned duties which involved day or afternoon shifts. Further, if not for his failure to accept these alternatives there would never have been any discussion about taking leave. It submits this situation is borne out by the evidence of Mr Keating, including the email from Mr Keating to Ms Hope dated 9 September 2011, and the correspondence from Ms Ackerley.

[26] Whilst acknowledging it is not an issue in the proceedings the DHS also submits that the serious misconduct stream was entirely appropriate in the circumstances in response to Mr Muscat’s behaviour and, in fact, the matter went to a subsequent discipline hearing where the findings were endorsed by the Delegate and the serious misconduct was substantiated.

Consideration

[27] Neither party made submissions about the approach to be adopted by the Commission in interpreting the terms of an enterprise agreement, however, there is little dispute as to the principles that apply. The authorities and the approach to be applied are well known and established. Where the terms of an industrial instrument are clear and unambiguous then that instrument should be interpreted in accordance with that clear and unambiguous meaning. In seeking to interpret an enterprise agreement regard must first be had to the natural and ordinary meaning of its words. The decision of Madgwick J. in Kucks v CSR Limited 18 is often referred to in this context. It dealt particularly with the interpretation of an award provision. His Honour stated:

“It is trite that narrow or pedantic approaches to the interpretation of an award are misplaced. The search is for the meaning intended by the framer(s) of the document, bearing in mind that such framer(s) were likely of a practical bent of mind: they may well have been more concerned with expressing an intention in ways likely to have been understood in the context of the relevant industry and industrial relations environment than with legal niceties or jargon. Thus, for example, it is justifiable to read the award to give effect to its evident purposes, having regard to such context, despite mere inconsistencies or infelicities of expression which might tend to some other reading. And meanings which avoid inconvenience or injustice may reasonably be strained for. For reasons such as these, expressions which have been held in the case of other instruments to have been used to mean particular things may sensibly and properly be held to mean something else in the document at hand.

But the task remains one of interpreting a document produced by another or others. A court is not free to give effect to some anteriorly derived notion of what would be fair or just, regardless of what has been written into the award. Deciding what an existing award means is a process quite different from deciding, as an arbitral body does, what might fairly be put into an award. So, for example, ordinary or well understood words are in general to be accorded their ordinary or usual meaning.” 19

[28] Whilst made in the context of an award the approach in that decision has been adopted in relation to the construction of industrial agreements generally. For examples, in City of Wanneroo v Holmes 20 French J. observed that when interpreting industrial instruments “fractured and illogical prose may be met by a generous and liberal approach to construction,”21 and the starting point should be a consideration of the natural and ordinary meaning of the words used. I have adopted the approach of these authorities in considering the terms of the Agreement in this matter.

[29] As indicated at the outset the issue to be determined is whether Mr Muscat was at some point, following the events of 28 August 2011, directed by the DHS to take accrued leave. This question is important because if Mr Muscat was directed in this way, as part of the disciplinary process provided for in Schedule C of the Agreement, then he is entitled to have that leave re-credited, given that he has not been terminated.

[30] It is appropriate at this point to make reference to the actual provisions in the Agreement that are relevant in this context. As indicated they are contained in Schedule C of the Agreement and, more particularly, in clause 6 of the Schedule. The relevant provisions in the sub clause are as follows:

“6.2 At all stages of the Serious Misconduct stream:

(a) the Employee shall continue to work at his or her workplace unless the Employer considers that it is clearly inappropriate for that to occur; in which case the Employee shall be directed to work at a reasonable alternative location, carrying out reasonable alternative duties;

...

(c) as an alternative to suspension with pay, the Employer may direct the Employee to take accrued leave; such direction to be reviewed if the period of the leave extends to five (5) weeks and then subject to weekly review;

...

(e) where the Employee is directed to take accrued leave, and the disciplinary outcome applied is not termination of the Employee's employment, then the leave taken shall be re-credited to the Employee;;” 22

[31] In the present matter this is a significant issue because Mr Muscat has accessed a significant amount of his leave entitlements since 5 September 2011, when he first began taking annual or “rec” leave. Since that time he has also variously accessed sick leave and long service leave entitlements.

[32] I have already made reference to the applicable principles to be applied to the interpretation of the Agreement; in particular, where the terms of an industrial instrument are clear and unambiguous then that instrument should be interpreted based on that clear and unambiguous meaning, and regard must first be had to the natural and ordinary meaning of its words.

[33] In this case I am satisfied the relevant words are clear and unambiguous and can be understood based on their natural and ordinary meaning. The key words in this context are:

“...the Employer may direct the Employee;” 23 and “...where the Employee is directed”24

[34] I am satisfied the reference to the employee being “directed” by the employer is clear and unambiguous. The Oxford dictionary in this context defines “direct” as “give a formal order or command to” and direction as “an order or instruction.” 25 Being directed clearly requires evidence of more than a suggestion or recommendation, or the provision of advice or a discussion about possible options. It would typically involve an outcome that the employee being “directed” is required to comply with, rather than one that the employee is at liberty to take up or not.

[35] Therefore, is there evidence adduced in this matter that indicates or confirms that Mr Muscat was “directed” in the natural and ordinary sense of that word by the DHS at some point after August 2011 to take accrued leave? The relevant evidence has been referred to already and can be summarised on the following basis.

• The alleged incident occurred on the morning of 28 August 2011. Mr Muscat was then suspended immediately for 2 nights on full pay and told by Mr Keating on 31 August 2011 that he would not be assigned to further active nightshifts, and DHS was investigating possible day and evening shift at other group homes.



• The suspension from duty with pay effective 31 August 2011 is confirmed in a letter from Ms Ackerley to Mr Muscat.



• A further telephone discussion took place between Mr Muscat and Mr Keating sometime between 2 September and 7 September. Mr Muscat states that during this discussion mention was made of alternative work duties, but no discussion was had about the specifics or an actual work location. Mr Muscat also states that at some point in the discussions with Mr Keating he was directed to take leave and told to contact a payroll officer about any leave arrangements.



• On the same day Mr Muscat calls Ms Hope and then states she was also confused about why he is required to access leave entitlements. Ms Hope says she will discuss the matter with Mr Keating and then contact Mr Muscat again.



• Mr Keating states that in the phone call that took place on either 2 or 5 September, he explained to Mr Muscat that assignment to active nightshifts was no longer an option for him, and if he was only prepared to work those shifts he might need to consider taking recreational leave.



• On 7 September Mr Keating is informed by Ms Hope that she has spoken with Mr Muscat and that he appears confused about his current situation. Mr Keating subsequently calls Mr Muscat who confirms he is unable to work morning or afternoon shifts and would be seeing his doctor given he is now anxious and stressed about what has occurred. Mr Keating subsequently emails Ms Hope the following day and indicates he believes Mr Muscat now understands the current situation.



• On 9 September 2011 Ms Ackerley details the allegations against Mr Muscat in a letter to him and also states Mr Keating had informed the Department that Mr Muscat had elected to take recreational leave at the time, although this is subsequently denied by Mr Muscat.



• On 12 September Mr Keating signs the form completed by Mr Muscat in regard to his sick leave.



• There are further subsequent exchanges between the parties and on 1 December Mr Muscat again sends an email to Mr Keating stating that his WorkCover claim has been rejected and he cannot process his sick leave application without a medical certificate. Mr Keating replies on the same day that he has received the certificates and confirms he is now in receipt of sick leave payments. In the same email exchange Mr Muscat explains he intends to use his “Sub Days and Rec Leave in that order.” 26

[36] Having reviewed the relevant circumstances and the various exchanges between the parties in this matter I can find no specific evidence of a direction of the kind contemplated by sub clauses 6.2(c) or (e) that has been given by the DHS to Mr Muscat. In the normal course of events it would be expected that such a direction would be documented and would likely, for example, have been contained in the correspondence provided to Mr Muscat by Ms Ackerley on 9 September 2011, if not at other points in the various exchanges that occurred between the parties. There is also no evidence of any such direction being reviewed on a weekly basis, where the period of leave extends beyond 5 weeks, as would be required by sub clause 6.2(c) of the Agreement. Mr Muscat’s own evidence also indicates he only considered it had been recommended to him that he take leave.

[37] It is acknowledged that there does seem to be some confusion on Mr Muscat’s part as to his status in the early part of September 2011, but this situation was then clarified in the discussions with Mr Keating, and in the subsequent correspondence from Ms Ackerley. I am satisfied that following the events of 28 August 2011 the DHS formed the view that Mr Muscat could not continue to work at any location on what are described as “active nightshifts,” given the nature of the work and the responsibilities involved. A decision was therefore made in accordance with sub clause 6.2(a) that other work would be found at “a reasonable alternative location, carrying out reasonable alternative duties”. However, Mr Muscat’s inability or refusal to work day or afternoon shifts stymied this option. Discussions then ensued about what other options might be open to him. Accessing his accrued annual or rec leave entitlements was one such option and when medical certificates were subsequently provided by him, accessing his sick leave entitlements became a further option.

[38] In conclusion, I can find no evidence that indicates Mr Muscat was formally “directed” at any time by anyone from the DHS to take accrued leave after the events of August 2011, and what followed from that point. Therefore I am not satisfied the DHS is required under sub clause 6.2(e) of the Agreement to re-credit any leave subsequently taken by Mr Muscat.

[39] I note the Department did indicate in its closing submissions that:

“Based on all the material today we say that Mr Muscat's application for reinstatement of leave entitlements should be dismissed. If there was some confusion early on, we say that Mr Muscat's leave entitlements, if the Commission found that they should be reinstated, should only be between the period 5 September to 9 September.” 27

[40] Given the conclusion I have come to about the absence of any evidence of a direction to Mr Muscat I am not satisfied the DHS has any obligation to reinstate payments to Mr Muscat for this period from 5 – 9 September 2011. However, this obviously remains an option that is open to the DHS if it believes it appropriate in all the circumstances.

[41] I confirm in conclusion that I am not satisfied that the DHS directed Mr Muscat at any time to take accrued leave in accordance with the provisions contained in sub clause 6.2(c) of the Agreement that covers the parties. Therefore I am not satisfied that the DHS has any obligation pursuant to sub clause 6.2(e) to re-credit any leave taken by Mr Muscat. The application is accordingly dismissed.

COMMISSIONER

Appearances:

Colin King of Counsel appeared on behalf of the Applicant.

Jerome Cooney of the Department of Human Services appeared on behalf of the Respondent.

Hearing details:

2014.

Melbourne:

28 January.

 1   [2013] FWC 6059 at [13]

 2   Ibid at [15]

 3   AE877880

 4   Ibid at Schedule C; clause 6.2(e)

 5   Transcript at PN179

 6   Exhibit K1 at para 14

 7   Ibid at para 21

 8   Ibid at para 23

 9   Ibid at para 30

 10   Ibid at Exhibit J; para 2

 11   Transcript at PN303

 12   Ibid at PN456

 13   Ibid at PN693

 14   Respondent’s Outline of Submissions at para 17

 15   Exhibit C1 at attachment TK-1; para 2

 16   Ibid at attachment TK-2; para 6

 17   Exhibit C2 at attachment KH-4; para 3

 18 (1996) 66 IR 82

 19   Ibid at 184

 20 [2006] FCA 813

 21   Ibid at 57

 22   AE877880 at Schedule C; clause 6.2

 23   Ibid at Schedule C; clause 6.2(c)

 24   Ibid at Schedule C; clause 6.2(e)

 25   Concise Oxford Dictionary of Current English, 8th Edition 1990

 26   Exhibit C1 at attachment TK-4

 27   Transcript at PN727

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