Garbutt v Stothers
[1996] IRCA 416
•27 August 1996
DECISION NO: 416/96
CATCHWORDS
INDUSTRIAL LAW - TERMINATION OF EMPLOYMENT - claim of UNLAWFUL TERMINATION - falsification of time sheet - whether VALID REASON FOR TERMINATION - degrees of seriousness of misconduct - COMPENSATION - inadequate notice.
Industrial Relations Act 1988 (C'th) ss170DB, 170DC, 170DE, 170EA
Aitken v CMETSWU of Australia (1995) 63 IR 1.
Blythe Chemicals Ltd v Bushnell (1933) 49 CLR 66.
Byrne & Frew v Australian Airlines (1995) 131 ALR 422.
Cohen v Orient Trading Pty Ltd, IRCA 228/96, Murphy JR, 31 May 1996, unreported.
Forster v Stainless Steel Mills (Aust) Pty Ltd, Parkinson JR, IRCA 51/95, 27 February 1995, unreported.
Grand United Friendly Society v F Lerritt (1994) AILR 97.
Gellie v Commonwealth Bank of Australia, Murphy JR, IRCA 298/96, 5 July 1996, unreported.
Kenefick v Australian Submarine Corporation (1995) 131 ALR 197.
Lifesavers (Australasia) Pty Ltd v Dougan (1986) 53 SAIR 525.
RG McGregor v Alburn Council, IRC (New South Wales), Connor C, 22 March 1995, AIR 5 - 034 (18).
Nicolson v Heaven and Earth Gallery Pty Ltd (1994) 1 IRCR 199.
Puccio v Catholic Education Office & Anr, von Doussa J, IRCA 198/96, 17 May 1996, unreported.
R v Industrial Court of South Australia: Ex Parte Mt Gumson Mines Pty Ltd (1982) 49 SAIR 709.
Sangwin v Imogen Pty Ltd, von Doussa J, IRCA 73/96, 8 March 1996, unreported.
Salvatore v BGC Concrete Pty Ltd, IRCA 680/95, Ritter JR, 21 December 1995, unreported.
Scharmann v APIA Club Ltd (1983) 6 IR 157.
Suares v Commonwealth Bank of Australia, IRCA 170/96, Murphy JR, 19 May 1996, unreported.
Venning & Anr v Wormald (Australia) Pty Ltd(trading as Wormald Fire Services) (1991) 41 IR 85.
JANICE MARY GARBUTT V YVONNE STOTHERS, WI 2452 OF 1995.
Before: RITTER JR
Place: PERTH
Date: 27 August 1996
IN THE INDUSTRIAL RELATIONS COURT
OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
WI 2452 of 1995
B E T W E E N:
JANICE MARY GARBUTT
Applicant
A N D:
YVONNE STOTHERS
Respondent
MINUTE OF ORDERS
27 AUGUST 1996 RITTER JR
THE COURT ORDERS AND DECLARES THAT:
The respondent terminated the employment of the applicant in contravention of section 170DE of the Industrial Relations Act 1988 (C'th).
The respondent terminated the employment of the applicant in contravention of section 170DB of the Industrial Relations Act 1988 (C'th).
The respondent do pay to the applicant the sum of $828 in compensation for the contravention of section 170DE of the Act within 14 days of the date of this order.
The respondent do pay to the applicant the amount of $376 damages within 14 days of the date of this order for the contravention of section 170DB of the Act.
NOTE: Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules
IN THE INDUSTRIAL RELATIONS COURT
OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
WI 2452 of 1995
B E T W E E N:
JANICE MARY GARBUTT
Applicant
A N D:
YVONNE STOTHERS
Respondent
REASONS FOR JUDGMENT
27 AUGUST 1996 RITTER JR
INTRODUCTION
This is an application under section 170EA of the Industrial Relations Act 1988 (C'th) ("the Act"). It is agreed between the parties that the applicant's employment with the respondent as a laundry worker at the Tom Price Laundry was terminated on 22 November 1995.
The applicant alleges that the termination of her employment was in contravention of ss170DB and 170DE of the Act. The applicant seeks the remedy of damages and compensation respectively. The respondent disputes the alleged contraventions of the Act.
In relation to the appropriate remedy, the respondent agrees that reinstatement would be impracticable.
The applicant gave evidence in support of her application and through her counsel, Mr Cywicki, called one witness, Mrs Gail Brough, a former employee of the respondent.
The respondent, through her counsel, Mr Herron, gave evidence and called as witnesses Mrs Joylene Marks, the Tom Price proprietor of a lunchbar called J's Mine Shop, which subsequently employed the applicant, and Mrs Tricia Devenyns. Mrs Devenyns is the daughter of Mrs Stothers and was at the relevant time and still is the manager of the Tom Price Laundry. Mrs Stothers is the Perth-based proprietor of the Tom Price Laundry. She has been the proprietor of that business for six years, having started the business, worked there as a laundry hand and built it up. The laundry business has a major client, Nationwide, who owns the Hillview complex of motel units. Mrs Stothers' business does the laundry service for Nationwide. Mrs Stothers said that, without Nationwide's clientele, "I don't have a business."
THE TERMINATION OF EMPLOYMENT
As stated, the termination of employment occurred on 22 November 1995. The applicant had commenced employment with the respondent in approximately September 1993 as a laundry worker on a casual basis. Thereafter, the applicant was permanently employed from approximately July 1994 to 7 December 1994. Between 8 December 1994 and 16 February 1995, the applicant was again employed on a casual basis. The applicant resumed permanent work with the respondent as a laundry worker on 16 February 1995 until the termination of her employment.
The respondent's situation, as explained by Mr Herron in closing, was that the termination of employment arose because of the dishonest falsification of a time record by Mrs Garbutt which occurred on 15 November 1995. This document, tendered as Exhibit 2, recorded in Mrs Garbutt's hand that on Wednesday, 15 November 1995 her "start time" was 8.00 am, her "finish time" was 3.30 pm and that her "hours" were in total 7.5 hours. Mrs Devenyns said that the time sheet was completed falsely for the following reasons.
Mrs Devenyns said that on 15 November 1995, she attended at the laundry to get some parts of some old machines out from the back of the laundry that had to go to the rubbish dump. Mrs Devenyns said that she got to the laundry at about 2.30 pm, after she had picked her children up from school at about 2.20 pm and dropped them at a friend's house. She said that Mrs Garbutt was not at the laundry at that time. She said that one of the men who picked up the laundry for Nationwide was in the laundry when she arrived. This person had a key to the laundry. Mrs Devenyns remained at the laundry until 3.40 pm. She said that Mrs Garbutt came back to the laundry at about 3.20 pm, or 3.25 pm. She said that Mrs Garbutt went into the laundry, swept the floor, took the lint out of the driers, came out and asked Mrs Devenyns if she could lock the laundry, said that she was going home, and left at 3.30 pm.
Mrs Devenyns said that after Mrs Garbutt left, she went in and checked the time sheet. It had not been completed. She said that the start time had been written on it, but not the finish time. On the following day, Mrs Devenyns said that she attended the laundry and noted that Mrs Garbutt had filled in the time sheet to record a finish time of 3.30 pm for the previous day, with no explanation as to where she had been for the time prior to that.
It is relevant to mention that the time sheet is not really conducive to recording explanations for gaps in the hours worked during the day. It is set up simply to record start, finish and total hours. In evidence, it was explained that this time sheet was developed for casual employees, whose hours needed to be recorded so that their wages could be determined. I will later return to the issue of the form of the time sheet.
Mrs Devenyns said that having viewed the time sheet, she "rang around a few places to find out where I stood as to falsification of a time sheet". Subsequent to that, she decided that she would terminate the employment of Mrs Garbutt. She said that she telephoned Mrs Stothers to let her know, and to arrange termination pay for Mrs Garbutt. She said that she then saw Mrs Garbutt the following Wednesday, which was the end of the pay week for the respondent. She said that she told Mrs Garbutt at 2.45 pm that she was terminated from employment at the laundry. She said that she explained that the reason was for termination was the time sheet being falsified.
Mrs Devenyns said that she thought it was necessary to terminate the employment of Mrs Garbutt because she had received complaints about Mrs Garbutt not being in attendance at the laundry (Mrs Garbutt being the only full-time employee at the laundry) when Nationwide wanted to attend. Mrs Devenyns said in her evidence that she did not think Mrs Garbutt was being fair to her in that "if she couldn't work the hours that I asked her to work, she shouldn't have been working full-time". The evidence was that Mrs Garbutt was employed to work a seven and a half hour day with some flexibility as to the start and finish times, and with an understanding that Mrs Garbutt could leave the laundry for a short period of time in the afternoons to collect her children from school and drop them off.
Mrs Stothers said in her evidence that the management of the laundry on a day to day basis was in the hands of Mrs Devenyns. During the course of Mrs Garbutt's employment with the respondent following the period when Mrs Devenyns became the manager, which was in February 1995, Mrs Garbutt telephoned her because of some problems in her working relationship with Mrs Devenyns.
Whilst Mrs Devenyns played down the suggestion of any problems between her and Mrs Garbutt during this time period, Mr Herron, in his closing submission, said, "Clearly, there has been a tussle between Mrs Devenyns and Mrs Garbutt. Mrs Devenyns said she did not have any great problems with it but I would suggest that is probably not the case." (transcript 157) I agree with this assessment.
Mrs Stothers said, and Mrs Garbutt agreed, that when such telephone calls were made, Mrs Stothers said she would speak to Mrs Devenyns about the issues raised. Subsequently, Mrs Stothers telephoned Mrs Devenyns about the particular issue raised.
With respect to the termination of employment, Mrs Stothers said Mrs Devenyns telephoned her regarding Mrs Garbutt and the time sheet, and several other issues, and asked what she wanted to do about it. There were some subsequent telephone calls between the two of them until a few days later, Mrs Stothers agreed that if it was Mrs Devenyns's choice to terminate the employment of Mrs Garbutt, then she was agreeable to this. Mrs Devenyns indicated that this was her choice, and Mrs Stothers said that she said "fine. I will make sure her wages are in the bank and everything is finalised." Mrs Stothers said that she made up the wages of Mrs Garbutt, and that it was her decision to pay a week's wages in lieu of notice. She said she paid a week's wages in lieu of notice "for the reason I felt - she'd worked for me and she'd been a good worker and I thought she deserved that. I preferred to pay her a week, rather than have her work out a week's notice". Mrs Stothers said she left it up to Mrs Devenyns to speak to Mrs Garbutt about the termination.
In her evidence, Mrs Garbutt said that on 15 November 1995, she did write on her time sheet that she started work at 8 am and finished at 3.30 pm. She had a doctor's appointment that day for 2.40 pm, so she started work at 7.30 am and worked through to 2.25 pm. She then said that she left the laundry and returned at 3.15 pm, finished off her duties and left the laundry again at 3.40 pm. She said that there was no room on the time sheet to "abbreviate" all this, so it was easier just to write it in as she normally would on any other day. When asked by her counsel when she completed the time sheet for 15 November 1995, she said that "I may have completed it before I had gone to the doctor's". Mrs Garbutt agreed that she saw Mrs Devenyns on 15 November 1995. She said that when she left the laundry, she left a note on the desk to say that she had gone to the doctor's and would be back later. She said that when she returned to the laundry, Mrs Devenyns was at the laundry, out the back, with a male companion. She said that she went around the back and asked casually, "What's happening here?" She said that the male gentleman turned around and just looked at her. She said that Mrs Devenyns didn't even acknowledge that she was standing there, so she walked back into the laundry, finished her duties by cleaning the lint, mopping the floor and emptying the bins and then went back and asked Mrs Devenyns if she would like her to lock up or would she do it. Mrs Devenyns said she would do it herself, so Mrs Garbutt went home at 3.40 pm. She said that when she left the laundry to go to the doctor's appointment, she left the laundry premises open. She said that this was the agreement with the groundsman for the Hillview complex so that he could collect the laundry if Mrs Garbutt was away.
Mrs Garbutt said that she left the note that she had gone to the doctor's on the desk in the laundry where the paperwork was done. She said that she wrote on the note, "have gone to the doctor's, will be back soon". She said that she did not see the note again.
Mrs Garbutt said that Mrs Devenyns did not say anything to her about the time sheet either on 15 November 1995 or thereafter until the date of dismissal.
Mrs Garbutt said that the dismissal was effected in the following manner. She said that Mrs Devenyns came into the laundry at about 2.35 pm on 22 November 1995. Mrs Garbutt was still working, and Mrs Devenyns started folding towels and spoke to her about telephoning her mother after her mother had returned from a funeral on 12 October 1995. Mrs Garbutt said she had not been aware that Mrs Stothers had been to a funeral. There was no further conversation for a time, while Mrs Devenyns continued folding sheets and towels; then, at about 2.55 pm, Mrs Devenyns called Mrs Garbutt to the desk and said that her employment was being terminated and that all her money would be in the bank. She asked Mrs Garbutt to return the laundry keys. Mrs Garbutt asked why she was being terminated and she said that Mrs Devenyns snatched the time sheet out of the folder sitting on the desk and said, "because you falsified your time sheet". Mrs Garbutt said that she then just walked out.
Mrs Garbutt explained in her evidence that she endeavoured to telephone Mrs Stothers to discuss her termination but was unable to do so. In her evidence, Mrs Devenyns said that Mrs Garbutt did not advise her that she had to attend a doctor's appointment on 15 November 1995. In her cross-examination, Mrs Devenyns was not asked whether she had seen the doctor's note which Mrs Garbutt claimed she left on the desk. She was also not asked whether the termination was effected in the way Mrs Garbutt described. Mr Cywicki did not cross-examine on Mrs Devenyns's evidence that she was not advised that Mrs Garbutt had to attend a doctor's appointment.
I accept the evidence of Mrs Devenyns that she was not advised that Mrs Garbutt was attending at an appointment with the doctor. I do not accept the evidence of Mrs Garbutt that she left a note for Mrs Devenyns at a location where Mrs Devenyns would have seen it.
Having regard to the totality of Mrs Garbutt's evidence, I think it likely that she thought that she could leave the laundry and attend at the doctor's office and then return, without the necessity for advising Mrs Devenyns or leaving a note of explanation.
Mrs Devenyns said in her evidence that she first discussed the issue of time sheets with Mrs Garbutt in about May 1995. She explained that the "deal" was at that time that Mrs Garbutt could go home if she had finished all the laundry to be done and if the premises were neat and tidy. She found that this was not happening. She said that in September 1995 she came to Perth and mentioned to Mrs Stothers that she was going to make Mrs Garbutt fill out a time sheet and work the required hours because she felt that the work was not getting done. Subsequent to this, she told Mrs Garbutt that she had to do the required hours, 8.00 am to 3.30 pm, and that she was to fill out a time sheet daily for the hours worked. (There was still the exception of picking up the children from school.) This discussion was in September 1995. Mrs Devenyns said that Mrs Garbutt started to complete the time sheet and then stopped and she just used to write down "7 hours" or "worked 6 hours" on a piece of paper. Mrs Devenyns said that she told Mrs Garbutt she had to go back to filling out time sheets because she wanted a record of time worked. This would have been in the middle of October 1995.
Mrs Devenyns said there was some difficulty in getting Mrs Garbutt to fill out a time sheet, but eventually, on about 8 November 1995, she said one had to be completed every day.
A reason for this was that she (Mrs Devenyns) had gone to the laundry on several occasions and Mrs Garbutt had not been there. She said that she had people go up to fix machines at half past 1.00 in the afternoon and Mrs Garbutt was not there. Mrs Devenyns said that the purpose in asking Mrs Garbutt to complete the time sheets was that she was supposed to work a 7½ hour day. If she could not do the 7½ hour day, Mrs Devenyns wanted to know how many hours she was doing, given that she was being paid to work full-time.
She also explained that on one occasion, a business called Direct Engineering Services went to fix a machine and Mrs Garbutt was absent. Mrs Devenyns said that she checked the time sheet which said Mrs Garbutt was there at the time, but Mrs Devenyns did not think she was because the man from DES told her that Mrs Garbutt was not present.
The employee from DES was not called by the respondent to give evidence. However, the applicant, in the cross-examination of Mrs Devenyns, tendered a document that she received from DES. As it was the applicant who took this course, I am of the opinion that I can have regard to the contents of the document to establish the facts. The document is a Direct Engineering Services Pty Ltd facsimile transmission cover sheet, which has been directed to Tom Price Laundry, "attention Trish", from Shane Patch and dated 8 November 1996 (sic). The document states that after receiving the call from Mrs Devenyns regarding the front loader washing machine not working properly, Mr Patch sent a technician up to the laundry to check the job but he found that the "place had been locked up". The document contained a request that Mrs Devenyns arrange a time with the service coordinator so that the work could be carried out.
Mrs Garbutt denied that such an incident occurred. Again, I do not accept the evidence of Mrs Garbutt. I prefer the evidence of Mrs Devenyns, as supported by the facsimile transmission from Direct Engineering Services. I therefore find that there was, prior to 15 November 1995, an issue relating to Mrs Garbutt being absent from her employment when she was supposed to be attending at her workplace and which caused the employer some inconvenience.
Mrs Garbutt's evidence was also that she was only requested to complete time sheets in November 1995. In support of this, the applicant's counsel pointed to the fact that there were only time sheets for November available. However, Mrs Devenyns said in her evidence that the time sheets were kept in a box in a cupboard where chemicals were stored and that the chemicals had spilt on the documents and destroyed them. I have no reason to doubt the evidence of Mrs Devenyns on this point and generally prefer her evidence as to the requests made to Mrs Garbutt prior to November 1995 about filling in time sheets. I also accept that the perceived need by Mrs Devenyns for Mrs Garbutt to fill in time sheets became more acute as time progressed because of her concerns about the hours that Mrs Garbutt was actually working. It was put to Mrs Devenyns in cross-examination that the request for Mrs Garbutt to complete time sheets had only one purpose and that that was to annoy Mrs Garbutt. This was rejected by Mrs Devenyns in her evidence, and I accept that this was not the reason for the request.
In her cross-examination, Mrs Devenyns disagreed with Mrs Stothers' assessment that Mrs Garbutt had been a good worker. She also disagreed with the evidence that Mrs Brough gave, that Mrs Garbutt had been a good worker whilst she worked with Mrs Garbutt; albeit this was up until the time that Mrs Brough left the employment of the Tom Price Laundry, which was in about February 1995.
Mrs Devenyns said that when she worked in the laundry as a casual employee with Mrs Garbutt previously, she was a good, diligent worker but when Mrs Devenyns became the manager, and only attended the laundry spasmodically, Mrs Garbutt did not work to the standard that she was capable of. Mrs Devenyns said that Mrs Garbutt needed to be pushed, to be told all the time to do things such as hang the sheets on the line, pull the cobwebs down off the roof and sweep the lint from under the tables. She said that she should not have had to explain these details to Mrs Garbutt as she knew what the job entailed. She said that she told her on many occasions to remove lint and cobwebs and they still had not been done. When asked in cross-examination about whether she counselled Mrs Garbutt about her inadequate work performance, Mrs Devenyns said, "I told her on many occasions, I asked her on many occasions."
Again, Mrs Garbutt generally rejected this when she gave evidence. Again, I prefer the evidence of Mrs Devenyns. Mrs Devenyns's evidence was given in a clear and consistent fashion, in contrast to the evidence of the applicant, particularly under cross-examination. There was also an issue as to the termination of employment of the applicant, when she was employed at J's Mine Shop, which places her credibility in issue. This was that the applicant resigned from her employment with J's Mine Shop, subsequent to her employment with the respondent, after she was accused of stealing from the shop and repaid an amount of money to the proprietor of J's Mine Shop for the items allegedly stolen. Mrs Garbutt accepted that this had occurred, when cross-examined.
In summary, on my view of the evidence, the reason for the termination of employment was that Mrs Devenyns thought that the time sheet dated 15 November 1995 was falsely completed. The time sheet was falsely completed, in so far as it records simply a commencement and finishing time, and a total of 7½ hours worked. Mrs Garbutt claimed in her evidence that she started work at 7.30 am and not 8.00 am. However, if this was so, then the recording of 8.00 am in the time sheet was inaccurate. There is no reason why Mrs Garbutt could not have written on the time sheet that she started at 7.30 am if that is what she did. For example, on both 14 and 16 November 1995, she recorded a 7.30 am commencement time. Therefore, I am not satisfied that Mrs Garbutt did commence at 7.30 am on 15 November 1995.
Further, stating that she was in attendance for a total of 7½ hours on 15 November 1995 was inaccurate, given Mrs Devenyns's evidence as described above as to the amount of time Mrs Devenyns was present at the laundry when Mrs Garbutt was not. There was at least 50 minutes between 2.30 pm and 3.20 pm, when Mrs Devenyns was present at the laundry and Mrs Garbutt was not. I accept this evidence. Therefore, Mrs Garbutt worked a total of about 6½ hours on 15 November 1995, whereas the time sheet showed that she had worked a total of 7½ hours with the start and commencement times referred to earlier. The time sheet was therefore knowingly filled out inaccurately; although the number of hours recorded on the time sheet did not reflect the amount that Mrs Garbutt was going to be paid, as she was not being paid on an hourly basis, and so therefore there was no fraudulent claim for wages from her employer. However, the background reasons as to why the time sheets were being completed, as I have accepted that Mrs Devenyns explained to Mrs Garbutt, ought to have meant that Mrs Garbutt was careful to accurately fill in the time sheet. This she did not do and, for this reason, together with the other dissatisfaction with Mrs Garbutt's performance that Mrs Devenyns mentioned, together with their inability to get on properly as manager/employee, the employment was terminated.
The next issue is whether the employment was terminated in contravention of a section or sections of the Act.
SECTION 170DC
The applicant's summary of facts, filed at the Court by her solicitors on 25 March 1996, did not assert that there was a contravention of section 170DC of the Act. Further, Mr Cywicki, in his closing submissions, did not assert that there had been a contravention of this section.
I am not sure why the applicant did not submit that section 170DC had been contravened. This section provides, in general terms, that the employer shall not terminate the employment of an employee for reasons connected with their conduct or performance, unless the employee has first had the opportunity to answer to the allegations made. Here, the termination of employment was connected with the conduct or performance of the applicant, the reason being the falsification of the time sheet. This allegation was not put to Mrs Garbutt before the termination of her employment. There would seem, on its face, to have been a contravention of section 170DC. Although section 170DC(2) provides an exception, where the employer could not reasonably be expected to give the employee the opportunity to defend themselves against the allegations made, there seems no reason why that would apply here. Although to some extent Mrs Devenyns herself knew the facts because she was a witness to the unauthorised absence from work and the false time sheet, there is no reason why at least an explanation should not have been asked for, before making a decision to terminate employment.
However, due to the fact that the applicant was represented by solicitors who chose not to submit that there had been a contravention of section 170DC, I do not think I ought to make any finding in this regard. To do so would be unfair to the respondent, in my opinion, as the issue was not raised by the applicant during the course of the hearing so as to give the respondent's counsel an opportunity to address the issue in evidence or submissions.
Rather than rely on section 170DC, the applicant submitted that there had been a contravention of 170DE(1) and that, as part of this, the applicant relied on alleged procedural inadequacies in the termination of employment of the applicant.
However, the distinction between procedural and substantive issues, for the purposes of section 170DE(1) and 170DE(2) of the Act, is not necessarily helpful: see Byrne & Frew v Australian Airlines (1995) 131 ALR 422 per McHugh and Gummow JJ at page 462. Further, as the High Court pointed out unanimously in that case, the mere fact that there have been procedural deficiencies in the termination of somebody's employment, absent a specific section such as 170DC of the Act, does not necessarily mean that there has been a termination of employment that has been harsh, unjust or unreasonable: see pages 434 and 463.
SECTION 170DE
As stated earlier, the respondent's case was that there was no contravention of section 170DE(1) of the Act, as there was a valid reason connected with Mrs Garbutt's capacity or conduct, being the falsification of the time sheet.
As stated earlier, I have accepted that the time sheet was falsified in the manner that I have discussed. The way in which the time sheet was filled out reflected a dishonesty by Mrs Garbutt in her record for her employer as to the number of hours, and commencement and finishing times worked on 15 November 1995. The seriousness of this is tempered to some extent by the fact that on the evidence of Mrs Devenyns, which I have accepted, Mrs Garbutt must have been aware that Mrs Devenyns already knew that Mrs Garbutt had been absent from the laundry for the period when Mrs Devenyns was there on her own before Mrs Garbutt arrived back. To some extent, therefore, this limits the extent of the dishonesty practised by Mrs Garbutt.
Wilcox CJ, in Kenefick v Australian Submarine Corporation (1995) 131 ALR 197 at 208, said of section 170DE(1) that :
"I think it follows that the reason must be genuine; there must be a causal relationship between the reason and the termination and that that the termination must be a logical response to the employee's capacity or conduct, or the employer's operational requirements."
Where there is a termination based on misconduct, for there to be a valid reason for termination, the misconduct must have a quality sufficiently serious to warrant the termination of employment. For example, it would be difficult to say that a secretary at a large office who stole one paper clip could be categorised by her employer as dishonest and a thief, and therefore there was a valid reason for termination of employment. In my opinion, there must be a qualitative aspect of the misconduct sufficient to warrant the sanction of termination.
Murphy JR in Gellie v Commonwealth Bank of Australia, unreported, IRCA 298/96, 5 July 1996, referred to two earlier decisions in which he considered the approach of the Court to the question of the validity of a reason for dismissal in misconduct cases. These decisions were Suares v Commonwealth Bank of Australia, IRCA 170/96, 19 May 1996, unreported, and Cohen v Orient Trading Pty Ltd, IRCA 228/96, 31 May 1996, unreported. These cases drew assistance from the judgments of von Doussa J in Sangwin v Imogen Pty Ltd, unreported, IRCA 73/96, 8 March 1996 and Puccio v Catholic Education Office & Anr, unreported, IRCA 198/96, 17 May 1996. In all four of these cases, it has been emphasised that in instances of misconduct, the valid reason for termination can be supplied by an honest and reasonable belief that the misconduct alleged occurred, after proper enquiry. Murphy JR in Gellie also said that the comments of Dixon and McKiernan JJ in Blythe Chemicals Ltd v Bushnell (1933) 49 CLR 66 at 81 on the meaning of misconduct were apposite:
"Conduct which in respect of important matters is incompatible with the fulfilment of an employee's duty or involves an opposition or conflict between his interest and his duty to his employer or impedes the faithful performance of his obligations, or is destructive of the necessary confidence between employer and employee, is a ground of dismissal.
Mr Herron, in his closing submissions, cited four cases in which falsification of records was an issue. Only one of these was a decision under the Act. This was Forster v Stainless Steel Mills (Aust) Pty Ltd, unreported, IRCA 51/95, 27 February 1995, a decision of Parkinson JR. In this case, the Judicial Registrar was satisfied that there was a persistent failure to attend for work on time, despite the express concern of the employer, and thus the employer did have a valid reason for the termination of the employment related to the conduct or performance of the employee, although she found that such a termination in the circumstances of the case was harsh. With respect to an allegation that the applicant had defrauded the respondent by remaining at work for excessively long periods of overtime, and not really working during that time, and by clocking on at work and then not working but leaving the premises and going on a frolic of his own, the Judicial Registrar, at page 13, concluded that the applicant was not fraudulent in his time keeping with the respondent, and that the allegation made against the employee was not true.
The second case referred to by Mr Herron was RG McGregor v Alburn Council, IRC (New South Wales), Commissioner Connor, 22 March 1995, digested at 1995 AIR 5-034(18). In this case, the applicant, who was a supervisor for garbage services, filled in a false time sheet for a fellow worker who was helping a seriously sick relative. The council dismissed the applicant for misconduct. The commission found that the applicant's dismissal was harsh and unreasonable because the council had paid insufficient regard to the applicant's unblemished work record. The Commission thought that reinstatement to the former position of trust held by the applicant was not appropriate because the applicant had, by his conduct, forfeited his right to that remedy. The Commission ordered the applicant be re-employed to any position of truck driver within the council's garbage service at the discretion of the council and for a six months probationary period, to give the council the opportunity to assess the applicant's service. The Commission did not condone the applicant's actions and said that demotion and loss of salary for almost four months was an appropriate penalty.
The third case cited by Mr Herron was Lifesavers (Australasia) Pty Ltd v Dougan (1986) 53 SAIR 525. There, the employee was employed as a travelling sales representative and was dismissed for falsification of a daily report sheet. The employee had been warned following a similar incident 14 months previously.
At first instance, the Commission determined that the conduct did not justify summary dismissal due to mitigating factors and the trivial nature of the matters complained of. The employer appealed to the Full Industrial Commission of South Australia. The Full Commission allowed the appeal, and held that the deliberate falsification of the respondent's daily report was conduct which was reasonably capable of warranting the exercise of the employer's right to dismiss. At page 530, the Full Commission commented that the respondent had deliberately falsified a daily report and had persisted in making a false denial to his employer at the relevant time. In such circumstances, the employee had again demonstrated himself to be a dishonest employee who was not to be trusted with the class of work that had been entrusted to him by the employer, despite the earlier warning that he had received as to consequences that would follow upon repetition of his earlier conduct. In those circumstances, the Commission held that the dismissal could not be said to be harsh or unjust or unreasonable.
The final case cited by Mr Herron was Venning & Anr v Wormald (Australia) Pty Ltd(trading as Wormald Fire Services) (1991) 41 IR 85, a decision of the Industrial Commission of South Australia. The case involved the dismissal of two employees, Mr Venning and Mr Harwood, who were summarily dismissed on consecutive days. The respondent operated the business of installing fire alarm and protection equipment, as well as the servicing of such equipment by periodical inspection and testing. Mr Venning was a tradesman's assistant and Mr Harwood was a qualified electrician. The dismissal of Mr Harwood was for reasons including unauthorised absence from his workplace for the purposes of conducting his own business and falsifying time sheets, and thereby seeking payment for time not engaged in work. Mr Venning was dismissed for similar reasons, including those previously specified. McCusker J reviewed the law relating to contracts of employment including the observation that not every breach of contract will give rise to a right to terminate. His Honour said that "in the law of employment, the right of an employer to terminate a contract by reason of breach by the employee is referred to as the right of summary dismissal. There is no fixed rule of law defining the degree of misconduct which will justify dismissal. The right will arise if something is done by the employee which impliedly or expressly constitutes repudiation of a fundamental term of the contract: per Wootten J in Scharmann v APIA Club Ltd (1983) 6 IR 157 at 163".
At page 94, his Honour referred to the judgment of King CJ in R v Industrial Court of South Australia: Ex Parte Mt Gumson Mines Pty Ltd (1982) 49 SAIR 709 at 712 where the Chief Justice observed that "the lawfulness of a dismissal must be relevant in determining whether the dismissal has satisfied the relevant statutory criteria, being whether the dismissal was harsh, unjust or unreasonable." The Chief Justice said, "The mere circumstance that the dismissal was lawful is a point in the employer's favour, whose cogency will depend upon the circumstances. Conversely, and perhaps more emphatically, if it is seen that a summary dismissal for alleged misconduct was unlawful because the conduct of the employee did not justify such an action, the circumstances would have to be quite unusual for that dismissal not to merit the description 'harsh, unjust or unreasonable'." McCusker J then reviewed the evidence before him and concluded that the termination of employment was harsh, unjust or unreasonable (page 99).
I agree with the submission made by Mr Herron that, in light of these authorities, "it is a matter of looking at all the circumstances. It is a matter of degree; it is a matter of weighing up the relative importance of time sheets and why time sheets are being completed in the first place, what importance is placed on the completion of time sheets by the employer and, importantly, what you take from the falsification of time sheets. In this case - the present case - it is our submission that the reason the time sheets were completed was because of some concerns expressed by the respondent's manager about the time-keeping of the applicant, and it was really for that reason that time sheets were required to be completed. It was also an issue of honesty in terms of adequately completing time sheets. There is simply no point in completing time sheets if they are not properly completed." I also agree with the factual observations contained in those submissions.
With respect to the time sheet and the difficulty of including on the form interruptions or absences from work during the day, Mr Cywicki said, "The time sheets seem almost to have a Monty Python air about them, in that they really go nowhere." Whilst I accept that the pro forma time sheets were not readily conducive to the inclusion of interruptions or absences from work during the day, such information could still be written on them or included in an appended note. The insertion of such details did not create an insurmountable problem for Mrs Garbutt. I do not think the time sheet is of a type that could have been prepared by the likes of Messrs Cleese and Idle for the purposes of confusing an employee in a comedy sketch, to follow the analogy and hyperbole referred to by Mr Cywicki.
In particular, Mrs Garbutt must have been aware of the concern that Mrs Devenyns had with whether she was working the required number of hours. This was the reason why the time sheets were introduced for Mrs Garbutt as a full-time employee. Therefore, she ought to have been more careful to make sure the time sheet was accurately completed.
Mr Cywicki submitted that this case was not so much about the falsification of a time sheet but absenteeism for part of the work day on 15 November 1995. In this regard, he referred to the case of Grand United Friendly Society v F Lerritt (1994) AILR 97, referring to paragraph 37 - 570 of the CCH Recruitment and Termination Guide. In this case, the New South Wales Industrial Commission held that a dismissal was harsh, unjust or unreasonable, (upheld on appeal to the Full Commission) where an employee had been employed by a building society for over seven years and was alleged to have been late for work on more than 72 occasions in the year preceding her dismissal. Lateness was important, as part of her duties were to open the office safe promptly at 8.30 am and provide cash to cashiers who required it before the society opened for the day. The employee had been given four written warnings in relation to her lateness. She was then dismissed following an incident of lateness without any inquiry as to the reasons for the lateness. The employee argued that she was only five minutes late on this final occasion and this had been due to the sickness of her baby. The Full Commission commented that the employee was lucky to be given another chance.
I agree that on issues such as absenteeism and lateness, this is a question of fact and degree in which the particular circumstances of the case need to be considered. The case of Salvatore v BGC Concrete Pty Ltd, unreported, IRCA 680/95, 21 December 1995, Ritter JR, is an illustration of this.
In this particular case, in all the circumstances, I do not think that the absenteeism on 15 November 1995 and the subsequent falsification of the time sheet provided a valid reason for the termination of employment. Whilst absenteeism and falsification of records can be serious issues, I do not think, in the particular circumstances, the conduct had a sufficiently serious quality to warrant termination of employment. With respect to the absenteeism, the period of absence seems to be about one and a half hours, the absence was to keep a doctor's appointment, and there was nothing that happened during the absence which actually caused any problem to the respondent. With respect to the falsification of the time sheet, it was not a falsification made for the purpose of obtaining money to which the applicant was not entitled, and it was not a false pretence in the sense that Mrs Devenyns already knew that there was a gap in the attendance for work on the day in question because she arrived at the work site during part of the absence. I think that Mrs Devenyns was generally unhappy and dissatisfied with the work of Mrs Garbutt, there was something of a tussle for control between Mrs Devenyns and Mrs Garbutt and that the termination of Mrs Garbutt's employment was seen by Mrs Devenyns as a way to end the difficulties that she was having with Mrs Garbutt in her conduct and performance, and to enhance her own authority as manager of the business.
If I be wrong in the conclusion that there was not a valid reason for termination, then in the circumstances, I would find that the termination of employment was harsh, unjust or unreasonable. My reasons for this are again the particular circumstances surrounding the absenteeism and falsification of the time record, Mrs Garbutt's length of employment with the respondent, albeit in differing roles, the lack of any specific warning about termination of employment for absenteeism and the failure to properly investigate the circumstances surrounding the absenteeism which would have only required a conversation with Mrs Garbutt and verification, if necessary, from the doctor concerned.
I therefore find that there has been a contravention of section 170DE of the Act.
REMEDY
As stated earlier, it was agreed that reinstatement was impracticable and that the remedy I ought to direct my attention to was that of compensation. Section 170EE(2) of the Act states that where reinstatement is impracticable, the Court may, if the Court considers it appropriate in all the circumstances of the case, make an order requiring the employer to pay to the employee compensation of such amount as the Court thinks appropriate. Section 170EE(3) states that in working out the amount of compensation, the Court is to have regard to the remuneration that the employee would have received, or would have been likely to have received, if the employer had not terminated the employment. There is a cap on the total amount of compensation that can be awarded, set out in sections 170EE(3) and 170EE(4).
Wilcox CJ in Nicolson v Heaven and Earth Gallery Pty Ltd (1994) 1 IRCR 199 stated that one needs to consider what would have been likely to have happened if there had not been a termination of employment in contravention of the Act. In this case, it must be considered that there is more than a distinct possibility that there could, in the future, have been a termination of employment not in contravention of the Act, for reasons including Mrs Garbutt's conduct, attitude and general work performance. Secondly, Lee J in Aitken v CMETSWU of Australia (1995) 63 IR 1 at page 9 said that "in assessing what is appropriate, the Court will have regard to what is reasonable in the circumstances; the Court will consider the detriment caused by the contravention of the Act, and whether it was reasonable to compensate the employee for the consequences".
At the time of termination, Mrs Garbutt was being paid $376 gross per week which was a net figure of $316. This was for a 38 hour week.
The applicant obtained employment with J's Mine Shop, commencing 3 December 1995, which concluded on 27 February 1996. The circumstances surrounding the termination of that employment have been set out earlier. This work was for about 20 to 24 hours per week. From 3 December 1995 to 25 February 1996, the applicant earned a total of $3,125.85 over 11 weekly pay periods, giving an average gross weekly wage of $284. This sum is about $92 less than the applicant was earning whilst she was employed with the respondent. When she gave evidence on 11 April 1996, Mrs Garbutt said that since the cessation of her employment with J's Mine Shop, she was working part-time for a cleaning company, Mastercare, at the Hamersley Iron Mine and earning about $230 gross or about $189 per week net.
The hearing of the application in this matter was part-heard on 11 April 1996, and the evidence and submissions were completed on 27 May 1996. During the course of the evidence given on that day, Mrs Devenyns referred to the applicant also being employed to do cleaning at the local school. Mrs Garbutt was not that day present in Court. Mr Cywicki tested, in cross-examination, the evidence on this issue.
Subsequent to the decision being reserved, Mr Cywicki, through his firm, Corser and Corser, wrote a letter to the Court, a copy of which was sent to Mr Herron, which said that at the time of the cross-examination of Mrs Devenyns, he did not have any instructions about Mrs Garbutt working at the school as a cleaner. The letter said that on the day following the trial, in discussions that he had with his client, he learnt for the first time that she had commenced part-time employment with the Education Department on 30 April 1996, working an average of 15 hours per week. Unfortunately, the letter did not specify the amount being earned by such employment. The letter stated that Mr Cywicki believed that the information should be drawn to the attention of the Court and that he had discussed the matter with Mr Herron, who had no objection to the Court being appraised of this additional information. It was, in my opinion, appropriate for Mr Cywicki to bring this matter to the Court's attention, although it would have been preferable if the amount earned by Mrs Garbutt was also conveyed. Nevertheless, the Court is grateful for Mr Cywicki's candour.
In summary, it seems that Mrs Garbutt was able to obtain employment after the termination of her employment with the respondent relatively quickly. This employment earned the applicant about $92 less than her work with the respondent. That employment with J's Mine Shop was terminated due to the applicant's misconduct. Subsequent to that, she has gained further employment with both Mastercare, and the Education Department, in cleaning jobs.
Because of the significant possibility that the employment relationship would not have continued, on the basis I have set out earlier, I have allowed for Mrs Garbutt as compensation is two months' wages (60 days), or about nine weeks. The actual loss to Mrs Garbutt over this period of time was $828, being nine weeks at a weekly loss of $92 per week. Therefore, I will make an order that the respondent pay to the applicant the sum of $828 compensation within 14 days of the date of the order.
INADEQUACY OF NOTICE
The applicant also claimed that section 170DB of the Act had been contravened. The applicant contended that the total period of her employment was from 23 September 1993 to 22 November 1995, and that therefore in accordance with the table set out in section 170DB of the Act, the applicant ought to have been paid at least two weeks in lieu of notice. The respondent contended that the applicant's employment as a permanent employee only re-commenced from February 1995 and that therefore she had been employed for not more than one year, and had been paid the one week in lieu of notice that she was entitled to.
The table to section 170DB(2) to the Act has the heading on the left-hand side of the table, "Employees Period of Continuous Service with the Employer". On the right-hand side is set out the period of notice required for the various periods of continuous service with employers. In my opinion, the expression "period of continuous service with the employer" includes continuous service, whether in the capacity of a full-time or part-time employee. Further, in my opinion, the correct categorisation of the applicant's employment from September 1993 to July 1994 and then 8 December 1994 to 16 February 1995 was that of a part-time employee whose hours were not regularly set, rather than a casual employee. In particular, during these periods, Mrs Garbutt was employed to work on Saturdays, although she would be available to work additional hours if required. I accept Mr Cywicki's submission that there was a pre-arranged regularity of work and that in such circumstances Mrs Garbutt could not be considered to be a casual employee or excluded as an employee for the purposes of the Act.
Therefore, in my opinion, to comply with the Act, the respondent should have paid Mrs Garbutt two weeks' notice, which was not done because the applicant was only paid one week in lieu of notice. The respondent is ordered to pay to the applicant the amount of $376 for the contravention of section 170DB of the Act as damages, pursuant to section 170EE(5) of the Act. I will also order that this amount be paid within 14 days. I should mention that I have no doubt that there was no deliberate attempt by Mrs Stothers or Mrs Devenyns to contravene section 170DB of the Act.
I certify that this and the preceding 25 pages are a true copy of the reasons for decision of Judicial Registrar Ritter as recorded in the transcript and revised by the Judicial Registrar.
Associate :
Dated : 27 August 1996
APPEARANCES
Counsel for the Applicant: Mr R Cywicki
Solicitors for the Applicant: Corser and Corser
Counsel for the Respondent: Mr M Herron
Solicitors for the Respondent: Gibson and Gibson
Dates of Hearing : 11 April, 27 May1996
Date of Judgment : 27 August 1996
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