Gidon v Isis Primary Care Ltd
[2010] FWA 2101
•12 MARCH 2010
[2010] FWA 2101 |
|
DECISION |
Fair Work Act 2009
s.394 - Application for unfair dismissal remedy
v
Isis Primary Care Ltd
(U2009/12163)
DEPUTY PRESIDENT IVES | MELBOURNE, 12 MARCH 2010 |
Termination of employment.
[1] This decision relates to an application by Ms N Gidon (the Applicant) claiming that the termination of her employment on 14 September 2009 by Isis Primary Care Ltd (the Respondent) was unfair within the meaning of s.385 of the Fair Work Act 2009 (Cth) (the Act).
[2] After taking into account, pursuant to s.399 of the Act, the views of the parties 1 and whether a hearing would be the most effective and efficient method of resolution, the matter proceeded by way of hearing on 3 February 2009.
[3] Evidence, both verbal and written, was adduced from the following persons:
- The Applicant
- Mr M Girolami, Director, Community Support Services for the Respondent
- Ms K Atwood, Human Resources Coordinator for the Respondent.
[4] The Respondent, in its primary submission, took issue with the Applicant’s application in a jurisdictional sense claiming that there had been no termination of the Applicant’s employment by the Respondent. Instead the Applicant’s employment contract with the Respondent had terminated by effect of frustration.
Background
[5] The Applicant was employed by the Respondent from 5 January 2009 until 14 September 2009 in the position of Case Manager.
[6] Her role was to provide home based social support to vulnerable children and families at risk of being subject to the statutory child protection regime.
[7] The Applicant was provided with a vehicle to transport herself to and from client appointments and other particular requirements related to her role.
[8] Possession of a valid driver’s licence was a prerequisite for appointment to the role and an ongoing requirement. 2
[9] For a significant period of her employment with the Respondent the Applicant was seconded to Bushfire Case Management Services which involved her working with somewhat different circumstances from those described above and from a different office location.
[10] For one reason or another, at no stage during the course of her employment with the Respondent did the Applicant carry a full caseload, claimed by the Respondent to be fifteen families 3, in the role for which she was initially employed.
[11] On 25 August 2009 the Applicant returned to work, in the role for which she was initially employed, having been away for a period on leave.
[12] On 28 August 2009 the Applicant, whilst in control of a vehicle not the property of the Respondent 4, was alcohol tested by police and found to be in excess of the legal limit for blood alcohol concentration.
[13] She was advised by police at the time that her driver’s licence was already the subject of a suspension order related to an accumulation of demerit points albeit that she, at that stage, may not have been in possession of advice from the relevant transport authority.
[14] The Applicant was subsequently advised that her driver’s licence was suspended, due to the accumulation of demerit points, from 11 August 2009 until 10 November 2009.
[15] The consequences of exceeding the blood alcohol concentration limit was to be the subject of a Court hearing and determination, scheduled for 18 February 2010. 5
[16] On 31 August 2009 the Applicant advised the Respondent of the suspension of her driver’s licence and the potential for a further and longer suspension.
[17] At a meeting on 4 September 2009 which included the Applicant and Mr Girolami for the Respondent, the Applicant was assigned office based duties on a temporary basis pending further consideration by the Respondent of the Applicant’s circumstances and provision by her of documentation related to the licence suspension.
[18] On 9 September 2009 a meeting was held including the Applicant and Mr Girolami and Ms Atwood for the Respondent, the ostensible basis for which was ‘to fully discuss this matter and the implications as provided for within the Isis Primary Care disciplinary process.’ 6 Ms Atwood’s contemporaneous notes7 of this meeting are contested by the Applicant only with respect to two particular issues which will be the subject of further consideration later in this decision.8
[19] The evidence discloses that neither at this meeting nor at any other relevant time was there any discussion between the Applicant and the Respondent regarding the Applicant undertaking her role utilising some alternative means of transport. 9
[20] At a further meeting with Ms Atwood and Mr Girolami on 14 September the Applicant was advised, inter alia, that her employment with the Respondent had terminated by effect of frustration of the employment contract.
[21] In a letter dated 16 September 2009 the Respondent provided confirmation of the ‘cessation’ of the Applicant’s employment. 10 That letter states (in part): “As a result of your actions you are deemed to have frustrated your employment contract. You will be paid all outstanding leave entitlements up to your last working day. Given you are unable to fulfil the inherent requirements of the role you cannot work your four week notice period as would ordinarily be required. Due to your particular circumstances I have authorized payment of four weeks notice as part of your final payment.”
[22] In what is, to say the least, confusing evidence Ms Atwood appears to claim that the Applicant was not paid a payment in lieu of notice but some form of ‘goodwill’ gratuity of an amount equivalent to notice. 11 This is in stark contrast to her witness statement which states “she was provided with a payment of 4 weeks salary in lieu of notice rather than being required to work out her notice period”.12
The Challenge to Jurisdiction
[23] The Respondent submits that the Applicant’s application is not within the jurisdiction of Fair Work Australia (FWA) as there was no termination of the Applicant’s employment on the employer’s initiative as required, in the circumstances of this matter, by ss.386(1)(a) of the Act.
[24] The Applicant’s employment contract, it is argued, was effectively discharged by an event which frustrated its continuing operation – that event being the suspension of the Applicant’s driver’s licence.
[25] I accept that if an employment contract terminates by effect of the legal doctrine known as frustration of contract then there is no termination within the meaning of s.386 of the Act and therefore no jurisdiction for FWA to entertain a claim pursuant to s.394 of the Act. The issue to be decided here is whether the doctrine of frustration can be properly ascribed to the circumstances of the termination of the Applicant’s employment.
[26] Much could be said, as is evidenced in the Transcript of Proceedings by the interchange between Counsel for the Respondent and the Bench, 13 and written here about what might be necessary for an employment contract to be frustrated in the sense provided for under the common law. It is unnecessary, for present purposes, to go to such lengths. In my view the challenge to jurisdiction fails at the hurdle that the Respondent posits as the relevant test.
[27] The Respondent relies on the authority of Donaldson J in Marshall v Harland & Wolff Ltd. The relevant passage in the judgement provides:
“The tribunal must ask itself: “Was the employee’s incapacity, looked at before the purported dismissal, of such a nature, or did it appear likely to continue for such a period, that further performance of his obligations in the future would either be impossible or would be a thing radically different from that undertaken by him and agreed to be accepted by the employer under the agreed terms of his employment?” 14
[28] Interestingly the Respondent neglected to provide in submissions the preceding sentence to the passage quoted above which states:
“In the context of incapacity due to sickness, the question of whether or not the relationship has come to an end by frustration sounds more difficult than it is.” 15
[29] Nevertheless and despite the fact that incapacity due to sickness has nothing to do with the matter before me, I accept that the passage contains a test of whether frustration of contract may have occurred that remains apposite to the circumstances with which I am confronted.
[30] In respect of whether further performance of the Applicant’s obligations in the future would have been impossible the Applicant’s evidence is:
“I also said I believed I could appeal to the court to be allowed to drive for work purposes.
There was no discussion about this at the time but I believed I could use some other means of transport to get to see clients.” 16
[31] For the Respondent’s part, it appears that Mr Girolami, at the meeting on 9 September 2009, advised the Applicant that it would be difficult to fulfil her role without a licence. 17 In his witness statement Mr Girolami contends that the use of public transport in managing a full case load would have been ‘simply impossible’18 and that “it would have been prohibitively expensive for [the Applicant] to have fulfilled these duties by taxi.”19 Ms Atwood states, presumably in relation to any extension to a proposal the Applicant made regarding obtaining a lift to work from a friend, that “[s]uch means of transport would be impracticable for travel during the working day.”20
[32] On their own evidence neither the Applicant nor the Respondent canvassed the potential for the Applicant to use other modes of transport to carry out her work obligations. 21
[33] The New Shorter Oxford English Dictionary (4thed) defines ‘impossible’ as, inter alia, ‘not possible; unable to be done or exist.’ In the circumstances of determining whether the Applicant’s employment contract with the Respondent was frustrated in the sense set out by Donaldson J in Marshall v Harland & Wolff Ltd it is insufficient to rely upon Mr Girolami’s apparently subjective appraisals as to what is or may have been impossible, contested as they are and lacking in any factual supporting basis.
[34] It is encumbent upon the Respondent in challenging the jurisdiction to make out its case in accordance with the legal principles and authorities upon which it relies. In my view it has failed to do so. Impossibility of performance is what the test requires – not, for example, impracticality. I am unable to find, on the materials before me, that further performance by the Applicant of her obligations in the future would have been impossible.
[35] It follows in respect of this matter that the possibility of performance of the obligations renders the circumstances that such obligations would become ‘a thing radically different’ nugatory.
[36] The majority of cases before courts and tribunals in which frustration of contract is dealt with in the context of employment contracts appear to arise in circumstances where illness or injury is the alleged frustrating event. That is obviously not the case here. For that reason it is appropriate to refer to a case not based on illness or injury to the extent that there is a relevance to the matter before me.
[37] The case of Tarnesby v Kensington and Chelsea and Westminster concerns an employed medical practitioner suspended from the medical register for a period of twelve months on the grounds of misconduct. The relevant health authority claimed that such suspension frustrated the medical practitioner’s employment contract – a claim rejected by the House of Lords. It was held, in those circumstances, that the contract did in fact terminate but by force of a statute not by the common law principle of frustration and that, had a different conclusion been reached regarding the effect of the statute, the practitioner’s suspension and consequent inability to perform his duties was not enough to frustrate his contract at common law. In his judgement Lord Lowry states:
“I would finally observe that, in my view, this is not a case of frustration as that term is understood in the law of contract. The appellant’s suspension from the register was not an unforeseen or unprovided for event brought about by legislation or otherwise but (as erasure had always been) was a contemplated misfortune the effect of which was clearly preordained.” 22
[38] It seems to me that in the extant case the suspension of the Applicant’s driver’s licence was not ‘an unforeseen or unprovided for event, but … a contemplated misfortune’. So much is evident from the Respondent’s reporting requirements with which the Applicant complied and which provide:
“Drivers Licence Status
ISIS Primary Care requires all staff to provide a copy of their current Victorian Drivers Licence as part of recruitment processes. Should there be any change to your licence or alterations in your driving status, you are required to provide this information to the Human Resources Coordinator. Eg. If you have a new licence due to expiry or loss of the existing licence, you must provide a copy to HR.” 23
[39] Based upon a proper consideration of Tarnesby it is difficult to see how the suspension of the Applicant’s driver’s licence could frustrate her employment contract.
[40] More could be said about the facts relating to the termination of the Applicant’s employment including the reliance by the Respondent upon disciplinary policy which would further suggest against frustration. 24 It is, however, in the circumstances unnecessary.
[41] I find that the termination of the Applicant’s employment was upon the initiative of the employer as provided for by ss.386(1)(a) of the Act and, to that extent within jurisdiction.
[42] Neither do I find any other jurisdictional barrier to determining whether the termination of the Applicant’s employment was unfair within the meaning of the Act.
The Act
[43] At s.385 the Act provides:
“A person has been unfairly dismissed if FWA is satisfied that:
(a) the person has been dismissed; and
(b) the dismissal was harsh, unjust or unreasonable; and
(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and
(d) the dismissal was not a case of genuine redundancy.
Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388”.
[44] I find that:
- The Applicant was dismissed
- The Small Business Fair Dismissal Code is not a relevant consideration in this matter.
- The dismissal was not a case of genuine redundancy.
It remains to consider whether the dismissal was harsh, unjust or unreasonable.
[45] Section 387 of the Act relevantly provides:
“In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, FWA must take into account:
(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and
(b) whether the person was notified of that reason; and
(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and
(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and
(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal; and
(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(h) any other matters that FWA considers relevant.”
Valid Reason
[46] At the time of the suspension of her licence the Applicant had recently returned from leave and from her secondment to Bushfire Case Management Services. Her case load was due to be increased to fifteen families. Regardless of any efforts that might have been made by the Respondent to select cases to allocate to the Applicant requiring the least amount of travel, the burden of impracticality, inefficiency and ineffectiveness that would have befallen the Respondent in responding to its clients’ needs is, in my view, well into the unacceptable zone for anything other than for a brief period of time. So much is evident from both the catchment area from which clients for the Applicant to service could be drawn 25 and from the Applicant’s acknowledgement of the service requirement insofar as the number of visits necessary to provide the service for a full case load of clients.26
[47] The period of impracticality, inefficiency and ineffectiveness imposed by the Applicant’s licence suspension and likely further suspension was not brief. It was of definite duration to 10 November 2009 and then sometime thereafter for a further period highly likely to be twelve months duration.
[48] I accept the Respondent’s evidence that reasonable alternative office based duties were not available for the period or potential period involved 27 and I further accept the Respondent’s evidence that it was under the apprehension, garnered from the Applicant, that the suspension periods would be for a total of fifteen months.28
[49] The Applicant was not an entirely credible witness. She claimed that she had not told the Respondent that the period of licence suspension she would get for exceeding the blood alcohol limit would be twelve months, only that a twelve month suspension was a possibility. 29 She further claimed that she did not tell the Respondent that she would be unable to obtain a restricted driver’s licence or that she would be suspended from driving from the time of her Court case.30
[50] The Applicant, however, when cross examined on the content of a blacked out section on a statement of Driver Licence Details she had received from Vic Roads 31 admitted to the blacking out but dissembled and denied knowledge before admitting, in response to a direct question, that she had had a previous licence suspension for exceeding the blood alcohol limit and the blacked out section ‘may’ refer to that.32 It is feasible that the Applicant may well have known and have more categorically stated the consequences she would suffer for her offence than her evidence during the hearing suggests.
[51] In the circumstances, where the evidence of the Applicant is at odds with that provided by Mr Girolami, Ms Atwood or with that provided by Ms Atwood’s contemporaneous notes, 33 I prefer the latter three sources.
[52] In any event it remains reasonable to assume that the overall period of suspension of the Applicant’s licence was far more likely than not to be an extended period in the range of the fifteen months acted upon by the Respondent.
[53] That the Applicant, in meetings with the Respondent, never raised the prospect of utilising alternative means of transport in carrying out her employment obligations is likely indicative of recognition on her part of the impracticality of such means. Further, given the Applicant’s record of offences, her chance of being granted a restricted licence was exceedingly slim, if at all existent, as she would have been well aware.
[54] The Respondent had other positions available that may have suited the Applicant’s qualifications. The Applicant was offered the opportunity to apply for such roles. In one instance Mr Girolami offered the prospect of waiving the requirement for a driver’s licence in respect of a particular position should the Applicant apply and be successful in being selected for the position. The Applicant did not seek to be considered for the roles.
[55] There was a valid reason for the termination of the Applicant’s employment by the Respondent. That reason was the Applicant’s significantly diminished capacity for an extended period of time to carry out her duties in a manner that achieved the objectives required of her.
[56] It is inarguable that, in the circumstances, alternative transportation means for the Applicant would have presented serious and unacceptable impediments to the Applicant meeting her employment obligations.
Procedural Fairness and Process Generally
[57] There were some obvious deficiencies in the process undertaken by the Respondent leading to the termination of the Applicant’s employment.
[58] These deficiencies were largely attributable, in my view, to the confusion caused by the Respondent’s use of disciplinary processes in circumstances where it was relying upon what it claimed to be frustration of the employment contract.
[59] Perhaps understandably, the deficiencies also likely rested upon misconceptions about the incidence and effect of the common law concept of frustration of contract.
[60] It appears on what is before me that the Applicant was not told in advance of the reason for her termination and therefore she could not have had an opportunity to respond in the sense that would normally apply within the meaning of subsections 387(b) and (c) of the Act.
[61] That said, the Applicant was aware of the Respondent’s mandatory requirement for her to have a valid driver’s licence. She was aware that she would not be able to fulfil that requirement for a considerable period of time. She was further aware that the Respondent was closely considering her circumstance and what options might present. She attended meetings to that effect. She should reasonably have been aware that absent reasonable and practical alternatives her employment would be terminated.
[62] There is no doubt that through the meetings that she attended with the Respondent there was opportunity available to her to have input into the decision making process. To some extent she took advantage of that opportunity by suggestions that she made with regard to particular options.
[63] In my view, had the procedure followed by the Respondent lacked any flaw in relation to the natural justice afforded the Applicant the result would still have been the same – that is the termination of the Applicant’s employment.
[64] There is no sound basis, on procedural fairness grounds, that I am able to find the termination of the Applicant’s employment to have been harsh, unjust or unreasonable and hence unfair.
[65] Subsection 387(d) of the Act requires that FWA take into account any unreasonable refusal by an employer to allow a support person to assist in discussions with a person subject to potential dismissal. There was no such refusal by the Respondent. For her part, the Applicant chose not to avail herself of a support person.
[66] Subsections 387(e), (f) and (g) are either irrelevant to the circumstances before me or had no impact on the dismissal decision.
Other Matters
[67] There are no other relevant matters pursuant to ss.387(h) of the Act.
Conclusion
[68] I have found a valid reason for the termination of the Applicant’s employment.
[69] I have found no basis to otherwise find the termination harsh, unjust or unreasonable.
[70] For the reasons given above I find that the termination of the Applicant’s employment by the Respondent was not unfair within the meaning of s.385 of the Act.
[71] The Applicant’s application is dismissed.
[72] I order accordingly.
DEPUTY PRESIDENT
Appearances:
G Dircks for the Applicant
R Millar of Counsel for the Respondent
Hearing details:
2010.
Melbourne:
February 3.
1 Transcript PN7-9
2 Exhibit R1, Attachments MG1 and MG3
3 Exhibit R1, PN16
4 Exhibit A1, PN40
5 Transcript PN46
6 Exhibit R1, Attachment MG4
7 Exhibit A1, Attachment NG7
8 Transcript PN263-264
9 Exhibit A1 PN44; Exhibit R3 PN9; Transcript PN319-331
10 Exhibit A1, Attachment NG9
11 Transcript, PN794-800
12 Exhibit R3, PN7
13 Transcript PN867-870 and PN948-1051
14 Marshall v Harland & Wolff Ltd [1972] 1 WLR 899 at 903
15 Ibid
16 Exhibit A1, PN43-44
17 Exhibit A1, Attachment NG7
18 Exhibit R1, PN18
19 Ibid PN19
20 Exhibit R3, PN9
21 Transcript PN319-320, Exhibit R3 PN9, Exhibit R1 PN10
22 Tarnesby v Kensington and Chelsea and Westminster Area Health Authority (Teaching) [1981] IRLR 369 at 371
23 Exhibit A1, Attachment NG4
24 Transcript PN727-728
25 Exhibit R2
26 Transcript PN114-119
27 Exhibit R1, PN13-14. See also Transcript PN552-555
28 Exhibit R1, PN8
29 Transcript PN276
30 Transcript PN262-263
31 Exhibit A1, Attachment NG5
32 Transcript PN162-171
33 Exhibit A1, Attachment NG7
Printed by authority of the Commonwealth Government Printer
<Price code C, PR994999>
0
0