Green v Preston Motors Pty Ltd
[2022] FedCFamC2G 205
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Green v Preston Motors Pty Ltd [2022] FedCFamC2G 205
| File number(s): | MLG 2653 of 2020 |
| Judgment of: | JUDGE BLAKE |
| Date of judgment: | 25 March 2022 |
| Catchwords: | INDUSTRIAL LAW – adverse action – workplace rights – whether complaints or inquiries made fall with section 341(1)(c)(ii) of the Fair Work Act 2009 – held certain complaints or inquiries are workplace rights for the purposes of the Act INDUSTRIAL LAW - adverse action – termination of employment and stand down from employment conceded to be adverse action – where other forms of adverse action alleged including CEO allegedly avoiding the applicant in the workplace – where evidence not sufficient to demonstrate CEO avoided applicant – where workplace investigation alleged to be adverse action – held workplace investigation not adverse action in the circumstances INDUSTRIAL LAW – adverse action – where decision to terminate employment taken by the CEO and where decision to stand down employees taken by the Board –alleged adverse action taken for an unlawful reason – where CEO gave evidence of reasons for decision to terminate employment – where CEO conferred with human resources manager about the termination decision – where CEO conferred with human resources manager before advising the Board about stand down and the Board relied on the CEO’s advice – whether failure to call the human resources manager to give evidence meant the onus in section 361 of the Fair Work Act could not be discharged in respect of the decision to stand down and the decision to terminate employment – held human resources manager not a decision maker – reverse onus discharged INDUSTRIAL LAW – adverse action – whether failure to give notice of termination under the Fair Work Act 2009 and the contract of employment constituted adverse action – held adverse action not taken against an employee whose employment is terminated for breaching the contract - breach of contract disentitles employee to notice under the Fair Work Act and the contract – held no breach of contract. |
| Legislation: | Fair Work Act 2009 ss 44(1), 117, 123, 340, 340(1) 341(1), 341(1)(c)(ii), 342, 342(1), 360, 361, 524, 526, 793 Occupational Health and Safety Act 2004 (Vic) |
| Cases cited: | Alam v National Australia Bank Ltd [2021] FCAFC 178 Australian and International Pilots Association v Qantas Airways Ltd (2006) 160 IR 1 Bartolo v Doutta Galla Aged Services Ltd (No 2) [2015] FCCA 345 Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500 CFMEU v Endeavour Coal (2015) 231 FCR CFMEU v Piblara Iron Company (Services) Pty Ltd (No 3) [2012] FCA 697 Cigarette & Gift Warehouse Pty Ltd v Whelan (2019) 268 FCR 46 Cummins South Pacific Pty Ltd v Keenan (2020) 302 IR 400 Ermel v Duluxgroup (Australia) Pty Ltd (No 2) [2015] FCA 17 General Motors Holden Pty Ltd v Bowling (1976) 12 ALR 605 Hansen v Mt Martha Community Learning Centre Inc (2015) 254 IR 1 Jones v Dunkel [1959] HCA 8 Jones v Queensland Tertiary Admissions Centre (No.2) (2010) 196 IR 241 Khiani v Australian Bureau of Statistics [2011] FCAFC 109 National Tertiary Education Union v Royal Melbourne Institute of Technology [2013] FCA 451 Patrick Stevedores Operations (No 2) v Maritime Union of Australia (1998) 195 CLR 1, 18 PIA Mortgage Services Pty Ltd v King [2020] 274 FCR 225 Police Federation of Australia v Nixon (2008) 168 FCR 340 Qantas Airways Ltd v Australian Licensed Aircraft Engineers’ Association (2012) 202 FCR 244, 250 Shea v TRU Energy Services Pty Ltd (No 6) (2014) 314 ALR 346 Shizas v Commissioner of Police [2017] FCA 61 United Firefighters Union of Australia v Metropolitan Fire & Emergency Services Board (2003) 123 IR 86 |
| Division: | Division 2 General Federal Law |
| Number of paragraphs: | 226 |
| Date of last submission/s: | 31 January 2022 |
| Date of hearing: | 29 November 2021 – 2 December 2021 |
| Place: | Melbourne |
| Counsel for the Applicant: | Mr Galbraith |
| Solicitor for the Applicant: | Maddison & Associates |
| Counsel for the Respondent: | Mr Donaghey |
| Solicitor for the Respondent: | Kalus Keny Intelex |
ORDERS
| MLG 2653 of 2020 | ||
| FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2) | ||
| BETWEEN: | CHRIS GREEN Applicant | |
| AND: | PRESTON MOTORS PTY LTD Respondent | |
ORDER MADE BY: | JUDGE BLAKE |
DATE OF ORDER: | 25 MARCH 2022 |
THE COURT ORDERS THAT:
The Application filed on 23 July 2020 and the claims set out in the Statement of Claim filed 2 October 2020 be dismissed.
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
JUDGE BLAKE:
Chris Green was employed by Preston Motors Pty Ltd (‘Preston Motors’) in the position of General Manager. Mr Green claims that he was subject to various forms of unlawful adverse action by Preston Motors culminating in the termination of his employment. He further claims that when Preston Motors terminated his employment, it did so without providing him with the requisite notice of termination. The various claims made by Mr Green are denied by Preston Motors.
For the reasons that follow, Mr Green has been unsuccessful in all his claims.
BACKGROUND
Preston Motors is part of what is known as the PM group of companies (‘PM Group’). The PM Group owns and operates four motor vehicle dealerships in and around Melbourne: Central Ford (in Kilmore); Essendon Holden (in Essendon Fields); Porsche Centre Doncaster (‘PC Doncaster’) and Porsche Centre Brighton (which is located in Bentleigh) (‘PC Brighton’). The dealerships sell new vehicles, preowned vehicles and products and services that are frequently sought with vehicle purchases such as vehicle finance, insurance, and aftermarket products and accessories.
Preston Motors Holdings Pty Ltd (an entity that is part of the PM Group) is party to an agreement with Porsche Cars Australia Pty Ltd (‘PCA’) and Finance & Guarantee Company Pty Ltd. The title of the agreement is ‘Franchise Agreement Porsche Centre Brighton’ (‘Franchise Agreement’). Under the Franchise Agreement made in or around June 2019, Preston Motors Holdings Pty Ltd and Finance & Guarantee Company Ltd are granted a non-exclusive dealership for the sale and service of Porsche products. PCA is recognised as the Australian distributor and importer of Porsche products and the owner or licensee of various intellectual property.
As well as being the Australian distributor and importer of Porsche products under the Franchise Agreement, PCA also sells Porsche products (specifically Porsche branded vehicles) to the public. PCA operates its own retail store in Collingwood, Victoria (known as the Porsche Centre Melbourne (‘PC Melbourne’). There was some debate during proceedings as to whether PCA is properly described as a direct competitor in the Victorian market to PC Brighton.
At all relevant times, the Board of Preston Motors (“Board”) comprised James Bergmuller as Chairman along with the following Directors: Peter Parker, James Auswild, and Graham Hamilton. In addition to the directors, Mr Gavin Smith was an advisor to the Board and the PM Group and at various times, was an advisor to Mr Bergmuller. Robert Gattereder was at all relevant times the Chief Executive Officer of Preston Motors.
Mr Green commenced working for Preston Motors in July 2018 in the position of General Manager of PC Brighton. Mr Green was employed under a written contract of employment with Preston Motors. Under the terms of his written contract of employment, Mr Green was entitled to a base salary of $160,000 per annum, superannuation, provision of a fully maintained vehicle and was eligible to receive short-term incentive payments or commissions.
In his role, Mr Green was the most senior employee working in PC Brighton and responsible for day-to-day operations of the PC Brighton dealership. Mr Green reported to Mr Gattereder.
In his employment, Mr Green along with other employees within the PM Group of companies was subject to the ‘PM Automotive Group Employee Code of Conduct’ (‘Code’). That document among other things, defines the concepts of ‘harassment’ and ‘bullying’ and encourages employees with concerns about bullying or harassment to speak to a person who can help them, including a supervisor, the Human Resource Manager, Training Manager, Contact Officer or an employee representative.
Mr Gattereder was appointed to his position in November 2017. His direct reports, in addition to Mr Green, included Flavio Parletta, General Manager of PC Doncaster; Darko Superba, Dealer Principal at Central Ford; Henry Belt, Dealer Principal of Essendon Holden and Rodney Tranter, Dealer Principal of Chadstone Ford & Hyundai (which ceased being part of the PM Group in April 2021).
Andrea Free was employed as General Manager, Human Resources for the PM Group. She held this position from 10 March 2017 to 31 March 2020. Mr Green was required to work with Ms Free in relation to human resources matters. For reasons which will become apparent, Ms Free also dealt with Mr Green in relation to his alleged complaints.
It is Mr Green’s case that from about October 2019, he was subjected to various instances of bullying, intimidating or aggressive behaviour from Mr Gattereder. Mr Green says he complained about this behaviour to Ms Free and also at times directly to Mr Gattereder and on one occasion to Mr Bergmuller. Mr Green says that as a result of his various complaints, among other things, he was subjected to various forms of adverse action from Preston Motors. That adverse action, he claims, ultimately led to him being stood down from his employment in March 2020 and his ultimate dismissal from employment on 31 March 2020.
Preston Motors denies that Mr Green was subject to any unlawful adverse action. Preston Motors says, among other things, that Mr Green was ultimately dismissed because he disclosed information that it regarded as being confidential to PCA.
Mr Green filed two affidavits for trial, was available for cross examination, and relied on various exhibits that were tendered throughout the proceeding. Each of Mr Gattereder, Mr Gavin Smith, Mr Bergmuller, Mr Hamilton, Mr Parker and Mr Auswild gave evidence for Preston Motors, along with Shahzad Ahmed, IT Manager for the PM Group. Each party also filed an outline of submissions on statutory considerations, an outline of case or case summary prior to trial commencing and closing written submissions. I have considered all of the material including the transcript of the hearing.
LEGISLATIVE FRAMEWORK
Mr Green advances his claims under sections 340, 117 and 44(1) of the Fair Work Act 2009 (‘Act’).
Section 340 of the Act
Section 340 of the Act is found within Part 3-1 of the Act. Relevantly, section 340(1) of the Act provides as follows:
(1)A person must not take adverse action against another person:
(a) because the other person:
(i) has a workplace right; or
(ii) has, or has not, exercised a workplace right; or
(iii)proposes or proposes not to, or has at any time proposed or proposed not to, exercise a workplace right; or
(b) to prevent the exercise of a workplace right by the other person.
Note: This subsection is a civil remedy provision (see Part 4‑1).
(2)A person must not take adverse action against another person (the second person) because a third person has exercised, or proposes or has at any time proposed to exercise, a workplace right for the second person’s benefit, or for the benefit of a class of persons to which the second person belongs.
Note: This subsection is a civil remedy provision (see Part 4‑1).
The term ‘adverse action’ is defined in section 342(1) of the Act. Relevantly, ‘adverse action’ includes the dismissal of an employee from employment, injury to the employee in his or her employment, altering the position of the employee to the employee’s prejudice or discriminating between the employee and other employees of the employer.
Section 341(1) of the Act identifies when a person has a ‘workplace right’. It relevantly provides as follows:
(1)A person has a workplace right if the person:
(a) is entitled to the benefit of, or has a role or responsibility under, a workplace law, workplace instrument or order made by an industrial body; or
(b) is able to initiate, or participate in, a process or proceedings under a workplace law or workplace instrument; or
(c) is able to make a complaint or inquiry:
(i)to a person or body having the capacity under a workplace law to seek compliance with that law or a workplace instrument; or
(ii)if the person is an employee—in relation to his or her employment.
Section 360 of the Act recognises that some adverse action might be taken for a variety of reasons, including reasons unrelated to the reasons that Part 3‑1 of the Act proscribes. In order to be actionable under Part 3‑1 of the Act, it is sufficient that relevant adverse action is taken for reasons that include such proscribed reasons.
Section 361 of the Act creates a rebuttable presumption concerning the proof, in any given case, of the reasons for which adverse action was taken. If, in an action alleging conduct was engaged in in contravention of Part 3‑1 of the Act, it is alleged that a person took or is taking action for a particular reason or with a particular intent, and taking that action for that reason or with that intent would constitute a contravention of that Part 3-1 of the Act, it is presumed that the conduct was engaged in for that reason, unless or until the person who engaged in it proves otherwise.
Section 793 of the Act deals with liability of bodies corporate. It relevantly provides that any conduct engaged in on behalf of a body corporate by an officer employee or agent of the body within the scope of his or her actual or apparent authority is taken, for the purposes of the Act, to have been engaged in also by the body corporate. Subsections (2) and (3) relevantly deal with how the state of mind of a body corporate is established.
Principles relating to sections 340, 341 and 342
For the purposes of section 342 of the Act, an employer:
(a)‘injures [an] employee in his or her employment’ if it subjects him or her to legally compensable injury; and
(b)‘alters the position of [an] employee to the employee’s prejudice’ if, by its conduct, it visits any adverse affection of, or deterioration in, the advantages enjoyed by the employee before the conduct in question.
See: Patrick Stevedores Operations (No 2) v Maritime Union of Australia (1998) 195 CLR 1, 18 [4] (Brennan CJ, McHugh, Gummow, Kirby and Hayne JJ).
An alteration to the position of an employee will be prejudicial if it visits adverse consequences that are real and substantial, rather than merely possible or hypothetical: Qantas Airways Ltd v Australian Licensed Aircraft Engineers’ Association (2012) 202 FCR 244, 250 [32] (Gray, North and Besanko JJ); CFMEU v Piblara Iron Company (Services) Pty Ltd (No 3) [2012] FCA 697, [48] (Katzmann J).
Extensive consideration has been given by Courts to the words ‘complaint or inquiry’ and to the meaning of the phrase ‘is able to make a complaint or inquiry…if the person is an employee – in relation to his or her employment’ in section 341(1)(c)(ii) of the Act.
In Shea v TRU Energy Services Pty Ltd (No 6) (2014) 314 ALR 346 (‘Shea’), Dodds-Streeton J considered what might qualify as a complaint for the purposes of section 341(1)(c)(ii) of the Act. At [29], Her Honour stated:
[29]I concluded, for reasons set out below, that in the context of s 341(1)(c)(ii) of the Act:
(a)a complaint is a communication which, whether expressly or implicitly, as a matter of substance, irrespective of the words used, conveys a grievance, a finding of fault or accusation;
(b)the grievance, finding of fault or accusation must be genuinely held or considered valid by the complainant;
(c)the grievance, finding of fault or accusation need not be substantiated, proved or ultimately established, but the exercise of the workplace right constituted by the making of the complaint must be in good faith and for a proper purpose;
(d)the proper purpose of making a complaint is giving notification of the grievance, accusation or finding of fault so that it may be, at least, received and, where appropriate, investigated or redressed. If a grievance or accusation is communicated in order to achieve some extraneous purpose unrelated to its notification, investigation or redress, it is not a complaint made in good faith for a proper purpose and is not within the ambit of s 341(1)(c)(ii);
(e)a complaint may be made not only to an external authority or party with the power to enforce or require compliance or redress, but may be made to persons including an employer, or to an investigator appointed by the employer;
(f)a complaint that an employee is able to make in relation to his or her employment is not at large, but must be founded on a source of entitlement, whether instrumental or otherwise; and
(g)a complaint is limited to a grievance, finding of fault or accusation that satisfies the criteria in s 341(1)(c)(ii) and does not extend to other grievances merely because they are communicated contemporaneously or in association with the complaint. Nor does a complaint comprehend contemporaneous or associated conduct which is beyond what is reasonable for the communication of the grievance or accusation.
In PIA Mortgage Services Pty Ltd v King [2020] 274 FCR 225 at [136] (‘PIA’), Snaden J referred to the Macquarie Dictionary definition of ‘inquiry’ as being ‘2. the act of inquiring, or seeking information by questioning, interrogation. 3. a question; query. – phr 4. make inquiry (or inquiries), to request information: to make inquiries at the office’.
In respect of the meaning of ‘complaint’ or ‘inquiry’ in the present matter, among other things, the issues in dispute centred on whether the complaints made by Mr Green fall within section 341(1)(c)(ii), whether the complaints were communicated to any decision-maker, and whether Mr Green was ‘able to make’ a complaint or inquiry. There was not any dispute in the present matter that the complaints that may be found to have been made related to the employment. No suggestion was made that any complaints made were not made in good faith.
Not all complaints and inquiries that an employee makes in connection with his or her employment are complaints or inquiries made in the exercise of a workplace right or rights. In Shea at [625], Dodds-Streeton J stated, inter alia, ‘the ability to make a complaint does not arise simply because the complainant is an employee of the employer. Rather, it must be underpinned by an entitlement or right. The source of such entitlement would include, even if it is not limited to, an instrument, such as a contract of employment, award or legislation’.
The observations of Dodds-Streeton J above have been the subject of endorsement and clarification by recent Full Courts. In PIA at [12] – [13], the majority (Raniagh and Charlesworth JJ) agreed with the reasoning of Dodds-Streeton J set out above, but considered that the phrase used by Dodds-Streeton J ‘must be underpinned by an entitlement or right to make a complaint’ to be ambiguous. Raniagh and Charlesworth JJ concluded that the phrase properly meant ‘must be underpinned by an entitlement or right to make a complaint’, while noting that whichever view was taken of what the phrase meant, it made no difference to the case before them. Snaden J in separate reasons at paragraph [164] of PIA also endorsed the view expressed by Dodd-Streeton J in Shea.
In PIA at paragraph [26] – [27], the majority stated that an employee is able to complain about an alleged breach of the contract of employment, that an employee is able to complain about an employer’s alleged contravention of a statutory provision relating to employment (including in circumstances where the statute does not expressly or directly confer a right to bring proceedings or complaint) and that the complaint must be genuinely made, in good faith and for a proper purpose. In making those statements, the majority stated expressly nothing was intended to foreclose argument as to other circumstances that may give rise to an ability to make a complaint.
In Cigarette & Gift Warehouse Pty Ltd v Whelan (2019) 268 FCR 46 (‘Whelan’), a Full Court at [28] (Greenwood, Logan and Derrington JJ) stated that the types of complaints that might qualify for the purposes of section 341(1)(c)(ii) include not merely those that were made in the exercise of rights and entitlements, but also complaints about entitlements that a contract of employment confers upon an employee. The Court stated:
[28]We are quite unable to see how any of this follows. The relevant clauses from Mr Whelan’s contract of employment are set out at para 36 of the primary judge’s reasons for judgment. It is not necessary again to reproduce them. They made provision for the annual fixing of a bonus plan and, at the very least, contemplated the payment to him, as a matter of discretion, of bonuses. He was entitled to make complaint or inquiry on these subjects. The following discussion of principle by the primary judge (at [33]–[34]) is, with respect, unremarkable and correct:
33Section 341(c)(ii) defines a workplace right in an employee as being the entitlement of the employee to make a complaint or inquiry in relation to his employment. In such cases as Shea v TRUenergy Services Pty Ltd (No 6) [2014] FCA 271; (2014) 242 IR 1 (Shea), Murrihy v Belezy.com.au Pty Ltd [2013] FCA 908; 238 IR 307; and Walsh v Greater Metropolitan Cemeteries Trust (No 2) [2014] FCA 456; 243 IR 468 (Walsh), s 341(c)(ii) was interpreted broadly. In Walsh [41], Bromberg J observed that the requirement in s 341(c)(ii) that a complaint or inquiry by the employee be “in relation to” his employment means that there must be a relationship between the subject matter of the complaint and the complainant’s employment. As Dodds-Streeton J further observed in Shea, a complaint that an employee is able to make in relation to his or her employment is not at large, but must be founded on a source of entitlement, whether instrumental or otherwise.
34As a general proposition, a complaint or inquiry to the employer by an employee in relation to his or her entitlement to an incentive bonus, or the failure of the employer to prepare an incentive bonus plan, where the terms of employment of that employee make provision for payment of such bonuses or the preparation of such plans, would fall within the scope of s 341(c)(iii) of the FW Act.
The pleaded complaint or inquiry in relation to a bonus constituted, for the reasons given by her Honour, the exercise of a workplace right for the purposes of the FW Act.
The statements above need to be contrasted with statement of Bromberg J (in obiter) at [45] – [67] with whom Mortimer J agreed, Anastassiou J contra, in Cummins South Pacific Pty Ltd v Keenan (2020) 302 IR 400 (‘Cummins’). There, Bromberg J after considering the various authorities, stated that the reasoning in PIA, Whelan and Shea was wrong and expressed the view that any employment related complaint, whether or not made as an exercise of some right or entitlement, would be enough to fall within the scope of section 341(1)(c)(ii) of the Act.
The apparent divergence in the authorities to which I have referred above has been discussed most recently by a Full Court in Alam v National Australia Bank Ltd [2021] FCAFC 178 (White, O’Callaghan and Colvin JJ) (‘Alam’). The Full Court in that matter made the following important statements. First, the Court did not accept it had a choice available to it between the approaches set out in PIA Mortgage and Cummins. The Full Court pointed out that the reasoning of Raniagh and Charleworth JJ was part of the ratio decidendi of that case whereas the reasons of Bromberg J were obiter. Accordingly, it was not a matter for the Court to choose between two equally available alternatives (at [93]). Second, the Court considered the different approaches set out in PIA Mortgage and Whelan. The Court noted that while there was some difference between the principles endorsed in each of these decisions, that difference is unlikely to be significant (at [94]). The Full Court proceeded on the understanding of section 341(1)(c) as indicated by the Full Court in Whelan (at [97]) before reiterating that it doubted the approach preferred by the majority in PIA will produce different outcomes in practice than the approach stated in Whelan. The Court stated:
[97] We consider that, irrespective of our own views concerning the proper construction of s 341(1)(c), this Court should proceed on the understanding of s 341(1)(c) indicated by the unanimous decision of the Full Court in Whelan. Doing so gives effect to the important principle of comity to which we have referred.
[98] As we have indicated, we doubt that the approach preferred by the majority in PIA Mortgage will produce different outcomes in practice than the approach stated in Whelan
Principles relating to section 360 and 361
In order to rebut the presumption in section 361 of the Act, an employer must typically lead evidence to show that the proscribed reason or circumstance that is alleged did not factor in any substantial or operative way as a reason for the conduct that an applicant seeks to impugn: General Motors Holden Pty Ltd v Bowling (1976) 12 ALR 605, 612 (Gibbs J), 619 (Mason J, with whom Stephen and Jacobs JJ agreed). It falls to the Court to determine ‘the actual reason of the decision-maker, in his or her own mind’: CFMEU v Endeavour Coal (2015) 231 FCR at [32] (Jessup J, with whom Perram J agreed at [77], Bromberg J dissenting).
In Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500 (“Barclay”), the High Court considered how an employer might rebut the presumption contained in section 361. French CJ and Crennan J at [44]-[45] stated:
[44]There is no warrant to be derived from the text of the relevant provisions of the Fair Work Act for treating the statutory expression “because” in s 346, or the statutory presumption in s 361, as requiring only an objective inquiry into a defendant employer’s reason, including any unconscious reason, for taking adverse action. The imposition of the statutory presumption in s 361, and the correlative onus on employers, naturally and ordinarily mean that direct evidence of a decision-maker as to state of mind, intent or purpose will bear upon the question of why adverse action was taken, although the central question remains “why was the adverse action taken?”
[45]This question is one of fact, which must be answered in the light of all the facts established in the proceeding. Generally, it will be extremely difficult to displace the statutory presumption in s 361 if no direct testimony is given by the decision-maker acting on behalf of the employer. Direct evidence of the reason why a decision-maker took adverse action, which may include positive evidence that the action was not taken for a prohibited reason, may be unreliable because of other contradictory evidence given by the decision-maker or because other objective facts are proven which contradict the decision-maker’s evidence. However, direct testimony from the decision-maker which is accepted as reliable is capable of discharging the burden upon an employer even though an employee may be an officer or member of an industrial association and engage in industrial activity. [footnotes omitted]
Where an employer gives evidence of why it engaged in the conduct the employee complains about, the inquiry starts and ends with whether, in fact, those reasons relevantly actuated that conduct. It is not necessary for an employer to prove that the reasons that actuated its conduct were procedurally or substantively fair: Khiani v Australian Bureau of Statistics [2011] FCAFC 109 at [33] (Gray, Cowdroy and Reeves JJ). A claim under Part 3‑1 of the Act ‘…is not a broad inquiry as to whether the applicant has been subjected to a procedurally or substantively unfair outcome’: Ermel v Duluxgroup (Australia) Pty Ltd (No 2) [2015] FCA 17, [48] (Bromberg J).
Section 117 and section 44 of the Act
Section 117 of the Act specifies the requirement to give notice of termination of employment, or payment in lieu of notice. Subsection (1) relevantly provides that an employer must not terminate an employee’s employment unless the employer has given the employee written notice of the day of the termination. Subsection (2)(a) provides that the employer must give to the employee notice of termination of at least the period worked out under (3). Subsection (2)(b) provides for payment in lieu of notice to be given to the employee at the full rate of pay for the hours the employee would have worked until the end of the minimum notice. Subsection (3) then specifies the period of notice that the employee is entitled to, depending upon his or her length of service. Relevantly, and importantly in the context of this matter, section 123 of the Act has the effect that an employee whose employment is terminated for serious misconduct is not entitled to notice of termination or payment in lieu of notice.
Section 117 forms part of the National Employment Standards under the Act. Section 44(1) of the Act relevantly provides that an employer must not contravene a provision of the National Employment Standards. Section 44(1) is an identified civil remedy provision under the Act.
EVIDENTIARY ISSUES AND WITNESSES
Prior to turning to deal with the facts, it is necessary to deal with various issues that arise in connection with the evidence that was presented to the Court.
Objections to evidence
Each party to the proceeding filed detailed written objections to evidence. Notwithstanding this, each party was content to proceed with the hearing without the objections to evidence being determined in advance. The various objections to evidence were then renewed as part of the parties written closing submissions. Given the matter proceeded in this way, I do not intend to now rule on each separate objection. Where it has been necessary to say something about the relevance or admissibility of evidence in these reasons, I have done so. I have otherwise reviewed the objections and taken them into account in the way I have dealt with the evidence without specifically referring to them.
The witnesses
Prior to examining the facts in detail, it is necessary to make some general observations about the nature of the evidence given by each of the principal witnesses and the manner in which they gave evidence. The principal witnesses in the case were Mr Green and Mr Gattereder. I had the advantage of observing both Mr Gattereder and Mr Green in the witness box. That is an important advantage to have in a case such as this.
Mr Green
Mr Green was aggrieved by what he perceived to be his treatment by Preston Motors, and Mr Gattereder in particular. He felt offended by what he regards as Mr Gattereder’s inappropriate conduct towards him. While Mr Green clearly felt he had been mistreated, over the course of the trial and when considering all of the evidence, I came to doubt his evidence as to whether Mr Gattereder behaved in the manner Mr Green had alleged or whether Mr Gattereder had abused, harassed or bullied Mr Green as alleged. Ultimately, I have not accepted Mr Green’s evidence or characterisation of a number of events. My reasons for so finding include the following.
First, Mr Green maintained that an email sent by Mr Gattereder to him on 21 March 2019 was ‘abusive’. For reasons set out later, that email cannot be described as abusive. That Mr Green maintained that it was so caused me to seriously question and ultimately doubt whether he had accurately characterised Mr Gattereder’s behaviour in other meetings with him.
Second, Mr Green often referred to Mr Gattereder’s behaviour as ‘aggressive’. That term of itself is unhelpful. Where evidence is given of particular behaviour, I have taken it into account, but the use of the term ‘aggressive’ does not take matters further. The Court cannot know what is meant by such term by itself without evidence as to what actually occurred.
Third, Mr Green complains about Mr Gattereder’s conduct at a meeting that occurred on 26 March 2020. Mr Green deposed that he ‘complained employees should not be stood down from work’. He also says he ‘complained that both the service and parts departments were both still achieving budget’. When all the evidence is considered, these are in truth not complaints. What occurred was simply a debate between two executives as to what the appropriate business outcome should be. Mr Green’s attempt to characterise what occurred as a ‘complaint’ does him little credit and adds to the significant doubts I have about the way he characterised events in his evidence.
In all of this, it needs to be remembered that the interactions between Mr Green and Mr Gattereder were interactions between very senior officers in a business. Mr Gattereder had responsibilities to the entire PM Group of companies. Mr Green was responsible for one of the principal dealerships or business units in that group. It is to be expected that persons with the responsibilities of Mr Green and Mr Gattereder will not always agree on a particular business or policy decision. It is also to be expected that leaders in the position of Mr Green and Mr Gattereder will occasionally disagree and exchange views forthrightly, directly and passionately. Much of what Mr Green complains about, as I note further below, does rise beyond a disagreement or exchange of views between senior managers.
I pause here to observe that Mr Green was asked in the witness box whether he was a person who was overly sensitive. He denied that he was. I do not accept that denial given the matters to which I have referred above and given my observations of him.
Mr Gattereder
Mr Gattereder impressed me as a witness. The transcript confirms my recollection that he answered questions directly, succinctly and with a degree of precision. The manner in which he answered questions left me with the strong impression that he is a man who is organised and efficient, and expects that from those who work for him. It is clear from the manner in which he answered questions that he does not mince his words - his manner of communication is direct and to the point. I have little doubt that his direct and forthright manner have been of assistance to him in his career, and in his present role as CEO. I also have little doubt that his manner of communication may be misinterpreted by some of those with whom he has to deal. Being direct and forthright in manner, however, does not necessarily mean that a person is being aggressive or menacing. That is a question that will always fall to be determined having regard to all the circumstances.
FACTS
The complaints about the Porsche Macan
On 20 September 2018, Mr Gattereder sent an email to Mr Green and Mr Parletta. In it, Mr Gattereder instructed Mr Green and Mr Parletta to make sure that every ‘non Porsche branded trade in vehicle is offered to our internal network first before being sold to third-party wholesalers’. As a result of that email, PC Brighton sold or transferred a Porsche Macan Turbo to Essendon Holden. Sometime later in around March 2019, Mr Green deposes that Mr Gattereder sent him an ‘abusive’ email. The email is as follows:
Hi Chris,
Pls. [sic] have a look – the GT3 needs to go this month. Other than that well done, good fresh stock. Get your finger out of muscle cars and focus on Porsche stock, #14 on Carsales want [sic] give you any traction. The car is not specified either.
Pls. [sic] get the Macan turbo back from Essendon. I know you have no space but you set them up to fail. They can buy 5 cars for one Macan.
I don’t want to have the discussion in one month time.
Thanks
Robert
Mr Green deposed that he wrote and sent an email to Ms Free complaining about the email Mr Gattereder had sent to him. He says he forwarded Mr Gattereder’s email to her and asked her to call him. Mr Green also deposed that Ms Free telephoned him the next day. He says that during that conversation, he complained about Mr Gattereder’s conduct toward him, the offensive nature of the email from Mr Gattereder and the accusation from Mr Gattereder ‘accusing me of intentionally sabotaging the business of the Respondent’.
Ms Free was not called to give evidence. The only evidence before me in relation to the interactions between Mr Green and Ms Free comes from Mr Green. Given the only evidence comes from Mr Green, I accept he complained to Mr Gattereder.
While I accept what Mr Green says he told Ms Free by phone and email, I do not accept that the email sent by Mr Gattereder to Mr Green on 21 March 2019 was abusive. It does not, to use Mr Green’s words, accuse Mr Green of sabotaging the business. The tone of the email is respectful - appropriate greetings and salutations are used. The content of the email is balanced - Mr Green is praised for doing a good job. There is no swearing in the email. I accept that Mr Gattereder tells Mr Green that ‘you set them up to fail’ however that does not of itself make the email abusive. Commercial reasons are given for the view Mr Gattereder expresses. Mr Green obviously had a different view and may have been disappointed that Mr Gattereder had a different view, but that difference of opinion or disappointment does not render the email abusive or offensive.
The complaints arising from Mr Peter’s attire
On 28 October 2019, Mr Gattereder met with Mr Green in the boardroom at PC Brighton. Mr Green deposed that during the meeting, Mr Gattereder told him that Pike Peters’ was not dressing appropriately. Mr Peters was employed as the Marketing Manager. Mr Green deposes that he offered to have a conversation with Mr Peters. Mr Green says that Mr Gattereder, however, became increasingly aggressive and intimidating towards him, displayed a menacing look to him when he was speaking and repeated his criticisms of Mr Peters’ dress. Mr Green says Mr Gattereder repeated his criticisms at least three times.
Mr Gattereder’s account of the discussion with Mr Green is different. He accepts that there was a discussion with Mr Green about Mr Peters’ dress sense. He says the discussion was nothing more than an informal discussion, and was not a formal meeting. He deposes that the conversation lasted no longer than five minutes, that he told Mr Green he was not impressed with Mr Peters’ dress sense, and that Mr Green told him that he would get Mr Peters to tone down his dress. Mr Gattereder otherwise refers to the meeting as being unremarkable. In cross-examination, Mr Gattereder denied speaking in an increasingly aggressive or loud tone or repeating himself three to four times.
In my view, Mr Gattereder was not happy about Mr Peters’ dress sense and made that clear. I expect, having observed the way Mr Gattereder communicates in the witness box, and having considered the manner of his communication in the email relating to the Porsche Macan, that he expressed himself in a direct manner with little ambiguity. His facial expression may have conveyed his unhappiness with the situation. So much might be expected from a person in Mr Gattereder’s position. On this issue, I prefer Mr Gattereder’s evidence. I regard him for the reasons stated previously as the more credible and reliable witness. Mr Gattereder did not behave in a manner that was aggressive or intimidating as alleged by Mr Green. The fact that the meeting occurred in the boardroom does not advance Mr Green’s account of the meeting.
Mr Green deposed that following the meeting with Mr Gattereder, he telephoned Ms Free to complain about Mr Gattereder’s conduct in the meeting, including that Mr Gattereder had been abusive and aggressive towards him, and that Mr Gattereder had repeated his criticisms at least three times in an aggressive manner. Mr Green’s evidence about this call is the only evidence before the Court. I accept Mr Green’s evidence that he complained to Ms Free about Mr Gattereder’s alleged conduct.
The consumption of alcohol complaints
Mr Green deposes that there was an occasional practice at PC Brighton where a small number of employees would gather together after the end of the work day for a drink. He says that Mr Gattereder had witnessed this on at least four occasions and had never raised concerns with it. Despite that, Mr Green claims that on 22 November 2019 he and Mr Michael Smith, the After Sales Manager were asked to meet Mr Gattereder in the boardroom at PC Brighton. According to Mr Green, the following discussion took place. Mr Gattereder asked Mr Green and Mr Smith whether they had read their employment contracts. Mr Green asked why the question was being posed. Mr Gattereder then allegedly said that he was ‘extremely disappointed in you both’ and that he did not ‘want to see alcohol being drunk on the property, I’m not willing to accept this sort of behaviour’. Mr Green claims that these words were said with increasing loudness and aggressiveness each time Mr Gattereder repeated himself, and that Mr Gattereder stared at him with a menacing expression as he spoke. Mr Green claims that he felt Mr Gattereder was bullying and harassing him, and that he was fearful and distressed as a result of his conduct. He also says that he complained about Mr Gattereder’s conduct toward him by ‘saying that I heard him the first time’. He says further that he telephoned Ms Free following the conversation to complain to her about Mr Gattereder’s conduct and that he also complained again to Ms Free about Mr Gattereder’s conduct in person when she attended PC Brighton on 23 November 2019.
Mr Gattereder agrees that a meeting took place between him, Mr Smith and Mr Green to discuss the consumption of alcohol on the premises and that the meeting occurred in the boardroom. He agrees that he asked Mr Smith and Mr Green whether they had read their employment contracts. He says he reminded them of the duty of care they had to staff. Mr Gattereder’s evidence is that he was concerned that the drinking of alcohol was visible to potential customers and he was concerned (as an employer with a duty of care) about employees consuming alcohol and then driving home.
Mr Smith was not called to give evidence. Mr Green submitted that I should draw a Jones v Dunkel [1959] HCA 8 (‘Jones v Dunkel’) inference that the evidence of Mr Smith would not have assisted Preston Motors, and take the failure to call him into account when deciding whether to accept Mr Gattereder’s account of the meeting. I decline to draw any inference. Mr Gattereder has given evidence and I regard him as a credible and reliable witness. I have set out my doubts about the manner in which Mr Green characterises matters. There is no gap in the evidence before me. The rule in Jones v Dunkel does not operate to require a party to give cumulative evidence.
There is not any significant dispute about what Mr Gattereder said. There is not any dispute that the employees drinking were visible (at least partly) to other persons who may have been in the showroom, though it seems no customer may have been in the showroom at that time. I am satisfied that Mr Gattereder asked Mr Smith and Mr Green whether they had read their employment contracts. I am satisfied that Mr Gattereder expressed his extreme disappointment in both employees and that he made it clear to them that he did not wish to see alcohol being drunk on the property. Mr Gattereder regarded this as a serious issue. He was entitled to do so given what was occurring was partially visible to customers who may have been in the showroom and given the potential duty of care ramifications for staff. There is no doubt Mr Gattereder expressed his displeasure at what had occurred. I have little doubt Mr Gattereder expressed himself in the forthright and direct manner he exhibited in the witness box. I find, however, that Mr Gattereder did not behave in an aggressive manner as alleged by Mr Green.
Mr Green says that he ‘complained about Mr Gattereder’s conduct towards me saying that I heard him the first time’. In my view, Mr Green made no such statement. Even if he made the statement, however, I do not regard it as a complaint in the sense described in Shea.
Mr Green says he also complained to Ms Free about Mr Gattereder’s conduct on the telephone not long after the meeting on 22 November 2019. He says he replayed the conversation to Ms Free. Mr Green also says that he complained to Ms Free the next day when she was in PC Brighton. Given Mr Green’s evidence is the only evidence before me in relation to these complaints, I accept he complained to Ms Free about Mr Gattereder’s alleged conduct.
The overspending complaints
Mr Green deposes that on 14 February 2020, he attended a business review meeting with Mr Gattereder in the boardroom at PC Brighton. Mr Parletta also attended the meeting by phone. Mr Green claims that during the meeting, Mr Gattereder accused him of being responsible for overspending in the marketing department. Mr Green’s account of the conversation is as follows. In response to being accused of overspending, Mr Green told Mr Gattereder that a discussion on overspending should occur after the meeting. Mr Gattereder then aggressively said with a menacing look on his face, and increasing volume, ‘No, we will discuss it now’. Mr Green then stated that the marketing overspend was largely due to the actions of Mr Gattereder and not him. Mr Green says that Mr Gattereder was not willing to accept responsibility for overspend of marketing and that he (Mr Gattereder) wanted a formal cost review to be conducted. Mr Green responded that neither he nor the departments he oversaw were responsible for the overspend. Mr Green then says that Mr Gattereder was visibly angered, had a heavy frown on his face, no longer wanted to have any further discussion, and cut the meeting short saying that he would conduct a formal review of the marketing spend and the issue could be discussed at a later date. Mr Green claims he told Mr Gattereder to stop yelling. Mr Green claims that he felt bullied and harassed, and was fearful and distressed as a result of the conduct of Mr Gattereder during the meeting, his level of aggression and the menacing look on his face.
In his evidence, Mr Gattereder referred to earlier communications he had received from others about concerns with overspending in the marketing budget. In respect of the meeting on 14 February 2020, Mr Gattereder agreed a discussion took place between himself, Mr Green and Mr Parletta about his concerns with their overspend of the marketing budget. Mr Gattereder admits he was annoyed and disappointed during the meeting, but denies he was aggressive and denies yelling. He denies saying that he was not willing to accept responsibility for overspend and says his spending had already been addressed. He recalls Mr Green saying that he was not responsible for the marketing overspend, but denies saying that he would conduct a formal review of the marketing spend and discuss it with Mr Green later. He accepts Mr Green accused him of being responsible for the overspend.
Mr Parletta was not called to give evidence. Mr Green submitted that I should draw a Jones v Dunkel inference that the evidence of Mr Parletta would not have assisted Preston Motors, and take the failure to call him into account when deciding whether to accept Mr Gattereder’s account of the meeting. I decline to draw any inference of the type sought. Mr Gattereder has given evidence and I regard him as a credible witness. I have set out my doubts about the manner in which Mr Green characterises matters. There is no gap in the evidence before me. Further, it is extremely doubtful that Mr Parletta could give any useful evidence. He was attending by telephone. Many of the behaviours Mr Green alleges would have required Mr Parletta to visibly observe Mr Gattereder and Mr Green, and Mr Parletta was in no position to do this.
While there is some variation between Mr Green and Mr Gattereder as to what was said in this meeting, there is not any significant dispute between Mr Green and Mr Gattereder as to the substance of what was said and discussed. Mr Gattereder admits he was annoyed and disappointed. I am prepared to accept that Mr Gattereder expressed his displeasure through his facial expressions and conveyed his displeasure to Mr Green and Mr Smith. I accept he spoke directly and forcefully, to emphasise his displeasure, but I find he did not yell, and nor did Mr Green tell Mr Gattereder to stop yelling. Mr Gattereder did not behave aggressively as alleged.
Mr Green claims that following the meeting, he was on the showroom floor when the Chairman of the PM Group, James Bergmuller, approached him and asked him how he was doing. Mr Green says that he told Mr Bergmuller that he was struggling with Mr Gattereder, that Mr Gattereder had been excessively aggressive and had bullied him, and that he had just been attacked about overspend in the marketing area without any factual evidence. According to Mr Green, Mr Bergmuller asked him ‘why do you think he is like this, is it because he is German?’. Mr Green says he responded with words to the effect that he thought Mr Gattereder acts like a spoiled child. Mr Green then claims he spoke to Mr Bergmuller about potential theft by Mr Gattereder being Mr Gattereder charging the company for service repairs to his own race car, and Mr Bergmuller responded by saying that they needed to sit down and have a more in-depth discussion, and that his assistant would arrange for that to happen. Mr Green says he asked Mr Bergmuller to keep the matters they had discussed between them confidential and that Mr Bergmuller agreed to this.
Mr Bergmuller was called to give evidence in relation to these matters. Mr Bergmuller’s evidence was that he was scheduled to have lunch with Mr Green on 14 February 2020, however he needed to attend to something else and told Mr Green he could not make lunch and they would need to reschedule. He denies having any conversation with Mr Green on 14 February 2020 in which Mr Green complained about Mr Gattereder’s conduct. He also denies the statement that he referred to Mr Gattereder as German, saying he knows Mr Gattereder is Austrian and that he himself is of Austrian descent.
Ultimately it seems a further meeting or lunch between Mr Green and Mr Bergmuller never took place, although the evidence is one was booked and cancelled.
The competing accounts about the conversation between Mr Green and Mr Bergmuller are difficult to reconcile. I have some real doubts, however, about Mr Green’s evidence in relation to this conversation. Mr Bergmuller gave evidence about his schedule that day and the limited time he had, which I accept. I accept his evidence that he is of Austrian extraction, that he knows Mr Gattereder is Austrian and would not mistake him for being German. It seems incredibly unlikely that a conversation of the significance attached to it by Mr Green would occur on the showroom floor at PC Brighton, potentially within view and earshot of others. It also seems unlikely that the allegation made by Mr Green, a senior employee, that Mr Gattereder as CEO was engaged in fraudulent activity was not followed up promptly by Mr Bergmuller as Chairman. These matters cause me to seriously doubt Mr Green complained to Mr Bergmuller in the manner he alleges. I prefer the evidence of Mr Bergmuller on this point and find that Mr Green did not complain to Mr Bergmuller in the manner he alleges.
In his evidence, Mr Green says that following the discussion with Mr Bergmuller, he telephoned Ms Free and left a voicemail message for her. He says that in that voicemail message, he complained that he had been bullied and spoken to aggressively by Mr Gattereder, and that he complained about this to Mr Bergmuller. Mr Green also says that on 15 February 2020, he spoke to Ms Free directly on the telephone and complained to her about Mr Gattereder’s conduct at the meeting on 14 February 2020, that he felt humiliated.
Mr Green’s evidence about the telephone message he left for Ms Free and the discussion he had with her is the only evidence before the Court in relation to these matters. I accept Mr Green complained to Ms Free about Mr Gattereder’s alleged conduct.
Contingency planning and the stand down of employees in the PM Group
By March 2020, the COVID-19 pandemic had spread to Australia and Melbourne. Many businesses considered measures to protect both business operations, employees and customers. The PM Group was no different. Events in the PM Group unfolded as follows.
Following an apparent request from Mr Gattereder, on 12 March 2020, Mr Green sent to Mr Gattereder an email in which he set out proposals on how the business could continue to operate during the pandemic.
On 18 March 2020, Mr Gattereder circulated via email to the Management Leadership Team (‘MLT’) (including Mr Green) a copy of the Business Continuity plan and directed that the plan be circulated to direct reports of the recipients on the email the next day. In the email, Mr Gattereder foreshadowed a staff announcement the next day.
On 19 March 2020, Mr Gattereder provided an update via video to employees about steps the business was taking to deal with the pandemic. The video was circulated on an internal WhatsApp group for Preston Motors employees.
On 20 March 2020, Mr Gattereder circulated an updated version of the Business Continuity Plan.
On 23 March 2020, Mr Gattereder via his assistant, Ms Mare, sent an email to the MLT, including Mr Green. In that email, Mr Gattereder outlined what would happen in the event the business needed to be shut down and attached a document outlining frequently asked questions. On this date, Mr Gattereder also created a further video update to employees advising them, among other things, that businesses within the PM Group would close if the ‘government requires a full lock down’. The video was circulated on WhatsApp by Natalie Juriansz on 24 March 2020 at 10:24am.
On 24 March 2020, several things occurred:
(a)at 7.53am, having considered the matter overnight, Mr Gattereder sent an email to the MLT which updated the email he sent on 23 March 2020;
(b)at approximately 1.04pm, Mr Gattereder sent an email to the MLT regarding daily walk in numbers at each of the dealerships. In his email, Mr Gattereder encouraged recipients of the email to keep reporting these numbers twice daily to Ms Juriansz;
(c)at 2.37pm, Mr Gattereder sent an email to various employees including Mr Green instructing them, among other things, to close out as many repair orders by close of business on Friday;
(d)the MLT met at 4.30pm to discuss the Business Continuity Plan. Mr Green attended the meeting;
(e)Mr Gattereder provided a report to the Board regarding the financial performance of the dealerships in the PM Group which showed, among other things, that only PC Doncaster had met budget.
On 25 March 2020 at approximately 4:30pm, the MLT met again to discuss business continuity planning. Mr Green attended the meeting.
On 25 March 2020, Stage 2 restrictions to contain the spread of COVID 19 came into force in Victoria.
In his evidence, Mr Gattereder deposed to the decline in sales leads, service bookings and sales volumes in the course of the week of 24 March 2020. I accept that Mr Gattereder was concerned about the decline in sales leads, service bookings and sales volumes at this time.
On 26 March 2020, Mr Gattereder met with Mr Green and Mr Michael Smith, in the boardroom at PC Brighton. Mr Green’s account of what was said at the meeting, which is not disputed to any significant extent by Mr Gattereder, is as follows. Mr Gattereder informed Mr Green and Mr Smith that employees in the business would be stood down (subject to Board approval) and that he wanted them to stop taking any further service bookings. In response, Mr Green stated that there was not any need to do this and that bookings could actually be ramped up. Mr Green also stated that employees should not be stood down as they could be usefully employed because work was coming through the door. Mr Green also stated that both the Service and Parts departments were still achieving budget, and that the Sales department still had 19 presold cars to deliver in April 2020.
Mr Smith was not called to give evidence in relation to the meeting above. Mr Green submitted that I should draw a Jones v Dunkel inference that the evidence of Mr Smith would not have assisted Preston Motors, and take the failure to call him into account when deciding whether to accept Mr Gattereder’s account of the meeting. I decline to draw any inference. There is simply not any significant dispute between Mr Green and Mr Gattereder as to what was said in this meeting. Mr Smith’s evidence would not have assisted matters. The only matter which is deserving of comment in relation to this meeting is Mr Green’s assertion in his evidence that he was ‘complaining’ to Mr Gattereder that employees should not be stood down, or that departments were achieving budget. I have dealt with this matter earlier and refer to my earlier findings.
On 26 March 2020 at approximately 11.32pm, Mr Gattereder sent an email to the Board of Directors of the PM Group. In that email, Mr Gattereder noted among other things that it was not commercially viable any longer to continue to trade all group businesses, that there had been a decrease in activity, as well as a rapid decline in sales leads, service bookings and sales volumes. In the email, Mr Gattereder proposed that the Board convene at 9am the following day for the purpose of making a decision to stand down all employees from employment on the afternoon of 27 March 2020 for a period of six weeks.
On 27 March 2020 at around 8.30am, Mr Green sent a text message to Mr Gattereder. The message was as follows: ‘Good morning Robert I’m am (sic) concerned about the plan you have mentioned yesterday and believe there is potentially a better way to save the dealership/group unnecessary costs. I have been working with Rose and Michael. This needs more of a financial plan’. Mr Gattereder’s evidence in relation to this text message was that he was unsure why it was sent given business continuity planning had been discussed and that Mr Green had been involved in those discussions.
The Board of the PM Group met at 9am on 27 March 2020. The meeting was attended by Mr Bergmuller, Peter Parker, Graham Hamilton, James Auswild, Gavin Smith and Mr Gattereder. Mr Gattereder spoke at the meeting. In his evidence, he deposed that his reasons for recommending the Board stand down the entire workforce are those contained in his email to the Board dated 26 March 2020, and also the uncertainty surrounding COVID 19. At the meeting, the Board resolved among other things to stand down the entire workforce effective from close of business on 27 March 2020 for a period of six weeks. The meeting concluded at 9:35am.
Following the Board meeting, at approximately 10.09am on 27 March 2020, Mr Gattereder sent an email to the MLT. In that email, Mr Gattereder communicated, among other things, the decision of the Board to stand down all employees from the afternoon of 27 March 2020 for a period of six weeks.
At 11am on 27 March 2020, the MLT met. Mr Green was in attendance. It is Mr Gattereder’s evidence that during that meeting, he outlined the reasons for stand down, requested a business case from each General Manager and indicated that the MLT was also to stand down for a period of 10 working days. During the meeting, Mr Gattereder indicated that a timeline would be provided for communications, and that an announcement made to all employees at 1:30pm. Mr Gattereder’s evidence is that while he indicated that PM Group would be communicating with broader stakeholders, the first communication needed to be within the PM Group and that the priority was to address employees first. I accept Mr Gattereder’s evidence about these matters.
At 2.10pm on 27 March 2020, Mr Gattereder sent an email to the MLT concerning the stand down. In the email, Mr Gattereder made clear that ‘our highest priority in delivering our communication this afternoon is to ensure that our team members feel they are being treated as a valued member of our team, and not like a number’. In the email, Mr Gattereder also outlined the communication schedule for each of the relevant managers.
At 3pm on 27 March 2020, a further meeting of the MLT occurred during which Mr Gattereder confirmed that everyone was up to speed on the proposed communication schedule. Mr Green was in attendance at the meeting.
For reasons which I expand upon later, at 2.57pm, Mr Gattereder’s video message to all PM Group employees regarding stand down was uploaded to a private WhatsApp group. Employees were subsequently informed they would be stood down from employment.
At 4.54pm on Friday, 27 March 2020, Mr Gattereder sent an email to Sam Curtis and Gary Tilley of PCA. In the email, Mr Gattereder informed PCA that the Board of the PM Group had decided, among other things, to stand down a large portion of the workforce for a period of six weeks. It is Mr Gattereder’s evidence that he did not inform PCA of the impending stand down prior to this in order to avoid a situation where an employee might find out by third party before being informed by him. Mr Gattereder was challenged about this aspect of his evidence. Ultimately however, I accept that Mr Gattereder was concerned to ensure that employees were firstly informed by PM Group management about the stand down, and to avoid the possibility of employees obtaining that news from elsewhere. That position is consistent with what Mr Gattereder stated to the MLT in his email at 2.10pm on 27 March 2020 - that employees were the highest priority and needed to be treated as valued team members.
At 5.30pm, a further meeting of the MLT was convened during which, among other things, Mr Gattereder thanked the MLT members for their efforts.
The meeting on 28 March 2020
On 28 March 2020, Mr Green, Mr Smith, Mr Tomljanovic and Mr Smallman met with Mr Gattereder in the boardroom at PC Brighton. According to Mr Gattereder, the meeting occurred because he had requested the General Managers to present a business case to keep various areas of the dealerships open.
Mr Green’s account of that meeting is as follows. He says that Mr Gattereder walked in and slammed a pile of folders down on the desk. Mr Gattereder then proceeded to tell Mr Green that he did not trust him or the group (which I take to be a reference to Mr Green and the other employees who were present) because he did not believe the numbers that had been provided to him in relation to the performance of the business. It is Mr Green’s evidence that Mr Gattereder stated that if he found out the numbers had been manipulated, there would be no tolerance and employees (positions) would be made redundant. According to Mr Green, Mr Gattereder was yelling and aggressive towards those present. Mr Green then says that he told Mr Gattereder that the financial details relied on by him were incorrect, and further told Mr Gattereder that the management team could manage the business on a day-to-day basis and if there was a downturn justifying closure of the business, they would act then.
Mr Gattereder agrees a meeting occurred on 28 March 2020. He says that he told Mr Green he did not trust the numbers reported in the cost overview because, he says, they were different to repair orders reported the previous day by Mr Green. He denied being angry entering the meeting, or slamming down a pile of folders, or threatening to make employees (positions) redundant. He agrees that he stated there would be no tolerance for manipulating the figures and he agrees that Mr Green told him the figures he had been relying on were incorrect. He also agrees that Mr Green told him that the management team could operate in a downturn and could act in response if things changed. He says the outcome of the meeting was a reduction in productive employees by five staff members.
None of Mr Tomljanovic, Mr Smallman, Mr Smith nor Mr Parletta were called to give evidence about this meeting. Mr Green submitted that I should draw a Jones v Dunkel inference that the evidence of these individuals would not have assisted Preston Motors, and take the failure to call them into account when deciding whether to accept Mr Gattereder’s account of the meeting. I decline to draw any inference. Mr Gattereder has given evidence and I regard him as a credible and reliable witness. I have set out my doubts about the manner in which Mr Green characterises matters. There is no gap in the evidence before me. The rule in Jones v Dunkel does not operate to require a party to give cumulative evidence.
There is not a significant dispute as to what was said at this meeting. This discussion occurred at what would have been an incredibly stressful period for all concerned. All employees had been stood down from employment the previous day. This meeting occurred in part to work out what parts of the business were to continue to function. It is understandable that tensions between participants at this meeting may have been high. I consider it likely that Mr Gattereder was displeased that certain figures were not correct. After all, he had just recommended to the Board that employees in the business be stood down from work. I consider it likely that Mr Gattereder made his displeasure known to those present including Mr Green and that it is likely that he made his points forthrightly and directly. Much was at stake. I am not satisfied that Mr Gattereder slammed folders on the table or that he threatened employees with redundancy. I regard the latter threat as unlikely to have been conveyed in circumstances where the workforce had already been stood down. I am also not satisfied that Mr Gattereder behaved aggressively.
Following the meeting above, Mr Green deposes that he spoke with Ms Free in the After Sales Manager’s office. It is Mr Green’s evidence that he complained to Ms Free about, among other things, Mr Gattereder’s threats to make people redundant, Mr Gattereder’s lack of trust in him and others, that it was the worst and most aggressive meeting he had had with Mr Gattereder and that the meeting was distressing for all concerned. Mr Green’s evidence about these matters is the only evidence before the Court. I therefore accept Mr Green’s evidence that he complained to Ms Free about Mr Gattereder’s alleged conduct.
Termination of employment of Mr Green
In order to understand the circumstances surrounding the termination of Mr Green’s employment, it is necessary to understand two other matters that occurred during the time that the PM Group was considering whether to stand down its employees from employment.
It is Mr Green’s affidavit evidence that on or around 26 March 2020, he telephoned Mr Steven Teixera, the Regional Sales Manager of Porsche Australia. Mr Green says that he complained to Mr Teixera that Mr Gattereder was going to potentially stand down the entire workforce of the group including him. Mr Green also says that he asked Mr Teixera whether Mr Gattereder was able to stand down employees, including him, under the Franchise Agreement without breaching it. In his affidavit, Mr Green did not set out the content of the conversation between himself and Mr Teixera. He simply asserts the making of the complaint and inquiry. Mr Green did, however, expand a little on his evidence in cross-examination. He said, when challenged as to whether he really made a complaint, that ‘I showed concern that he was going to do something he shouldn’t be doing, and in which I could stop him if it-if it was going to be in contravention, I had the potential to go to him before he did it and say “you may want to think about doing this first if that’s the way you want to go”’. Mr Teixera was not called to give evidence in relation to the conversation.
Mr Green also deposed to calling John Murray, Director of Sales and Network Development at PCA on or around 26 March 2020. Mr Green says that he complained to Mr Murray that Mr Gattereder was potentially going to stand down the entire workforce within the PM Group including himself. Mr Green says that he also asked Mr Murray whether Mr Gattereder was able to stand down employees given the terms of the Franchise Agreement with PCA. In his affidavit, Mr Green did not set out the content of the conversation between himself and Mr Murray. He simply asserts the making of the complaint. In cross-examination, Mr Green stated he called Mr Murray because Mr Teixera did not have the answers. Mr Murray was not called to give evidence in relation to the call.
The other evidence before the Court in respect of this phone call is Mr Gattereder’s call with Mr Murray at approximately 5:25pm on 28 March 2020. Mr Gattereder was returning an earlier call Mr Murray had made to him after 2pm on 27 March 2020. Mr Gattereder’s note of the telephone call indicates that he (Mr Gattereder) asked Mr Murray at the beginning of the conversation whether he had spoken to Mr Green. In reply, Mr Murray told Mr Gattereder that he had reached out to Mr Green at around 2pm on 27 March 2020 and asked Mr Green what was going on at the PM Group and PC Brighton. Mr Gattereder asked Mr Murray what Mr Green said. Mr Gattereder records Mr Murray’s answer as being Mr Green saying “PM group will stand down all employees and there is an announcement at 3.0pm [sic] about that. We still discuss details with Robert and Mark’. When Mr Gattereder asked a second time, the note records ‘John M. softened his answer and said again “Chris mentioned a potential stand down of all employees, the consequences for PCB (Porsche Centre Brighton are not clear, and there are discussion with Mark and Robert later today”’. The note then records Mr Gattereder telling Mr Murray that he was ‘very disappointed’ and would investigate.
One divergence in the evidence in respect of the incident above is in relation to when the call between Mr Murray and Mr Green occurred. In his first affidavit of 23 April 2021 at paragraph 92, Mr Green says he called Mr Murray on or around 26 March 2020. In his second and later affidavit, however (prepared after Mr Gattereder’s affidavit had been filed), Mr Green says definitively that he called Mr Murray prior to the 11am MLT conference call on 27 March 2020. No real explanation is proffered by Mr Green as to how he suddenly comes to recall at a later point in time, a point of detail that he could not recall when he prepared his initial affidavit. Mr Gattereder, in contrast, says he was told by Mr Murray that Mr Green had called Mr Murray at around 2pm on 27 March 2020, and he made a record to this effect. Mr Murray was not called to give evidence. Mr Gattereder, however, prepared a memorandum recording the content of this call with Mr Murray on 28 March 2020 which notes the time of the call between Mr Murray and Mr Green as being at round 2pm on 27 March 2020. While no objection was taken to this record of the call, Mr Gattereder’s evidence is effectively hearsay evidence of when the call occurred. There was not any detailed cross examination about the time the call was made. For present purposes, it is sufficient to record the call occurred either on 26 March or 27 March 2020.
Subsequently, on 30 March 2020, Mr Gattereder sent a letter to Mr Green by email at approximately 12.22pm. In that letter, Mr Gattereder:
(a)confirmed a decision to investigate Mr Green’s conduct of prematurely notifying PCA of the decision by the PM Group to temporarily stand down employees and whether this amounts to a breach of ‘your employment agreement’;
(b)alleged Mr Green had told Mr Murray of the stand down prior to a formal announcement being made to employees of the PM Group;
(c)summarised the confidentiality obligations Mr Green owed to PM Group under his employment contract; and
(d)invited him to a phone conference at 2pm that day to discuss the matter.
Mr Green subsequently attended a meeting with Mr Gattereder at 2pm. Ms Gillian Statham, Human Recourses Consultant, was also present. It is common ground that during this meeting, Mr Green confirmed that he had spoken to Mr Murray about the potential stand down of employees and whether such action was permitted under the Franchise Agreement.
At approximately 4.30pm, Mr Green attended a further meeting with Mr Gattereder. Mr Smallman was also in attendance. At that meeting, Mr Gattereder informed Mr Green that his employment was terminated with immediate effect because he had breached the provisions of his employment contract by disclosing confidential information to PCA. Mr Green was handed a letter confirming the termination of his employment. In that letter, Mr Gattereder stated, among other things:
(a)it had been determined that Mr Green’s conduct amounted to serious misconduct in breach of his employment agreement and that his employment was to be terminated with immediate effect;
(b)that Mr Green’s employment was being terminated because on Friday, 27 March 2020, in breach of his employment agreement, he disclosed confidential information to Mr Murray;
(c)Mr Green’s conduct could not be excused or downplayed due to the potentially serious and negative impact on ‘our’ valued team members which could have resulted, should they have heard such information from an external party;
(d)the reputational damage with Porsche was also a concern;
(e)Mr Green’s conduct was inconsistent with the trust and confidence required for a senior member of the leadership team, and that Mr Gattereder had lost all trust and confidence in Mr Green’s ability to protect confidential information and act in the best interests of the PM Group going forward.
THE EXERCISE OF WORKPLACE RIGHTS
Mr Green claims that adverse action was taken against him in contravention of section 340(1) of the Act:
(a)because he had and exercised workplace rights to make complaints and inquiries in relation to his employment within the meaning of section 341(1)(c)(ii) of the Act;
(b)because he had a workplace right within the meaning of subsection 341(1)(a) as he was:
(i)entitled to the benefit of a working environment that is safe and free of risks to health under the Occupational Health and Safety Act 2004 (Vic) (‘OHS Act’);
(ii)entitled to the benefit of a notice of termination or payment in lieu of notice under section 117 of the Act;
(iii)entitled to only be stood down from employment in certain circumstances, and not if he could usefully be employed, under section 524 of the Act;
(c)because he had a workplace right within the meaning of subsection 341(1)(b) of the Act to initiate or participate in a process or proceedings under section 526 of the Act (relating to stand down);
(d)to prevent him from exercising workplace rights by making further complaints and/or inquiries in relation to his employment under subsection 341(1)(c)(ii) of the Act, or to prevent him from exercising workplace rights by initiating or participating in a process or proceedings under section 526 of the Act.
In respect of the workplace rights identified above, each party spent much of their time focusing on whether Mr Green had exercised workplace rights to make complaints or inquiries as contemplated by subsection 341(1)(c)(ii) of the Act. It is to that matter which I turn first.
The complaints and inquiries
The Porsche Macan complaints
I am satisfied that the complaints Mr Green made to Ms Free by phone and email are complaints that fall within the meaning of section 341(1)(c)(ii) of the Act. Mr Green was complaining of ‘abuse’ and ‘offence’. The Code applies to Mr Green and identified that harassment and bullying could be raised with the Human Resources Manager. The OHS Act requires employers to among other things provide, as far as practicable, a workplace that is safe and without risks to health. Mr Green was therefore able to complain about the conduct in the sense contemplated by PIA and Whelan. Further, his communication with Ms Free was the notification of an accusation by Mr Green and received by her. It therefore falls within the definition of ‘complaint’ contemplated in Shea.
The complaints arising from Mr Peters’ attire
I am satisfied that the complaint Mr Green made to Ms Free is a complaint that falls within the meaning of section 341(1)(c)(ii) of the Act. Mr Green was complaining of abusive and aggressive behaviour. The Code applies to Mr Green and identified that harassment and bullying could be raised with the Human Resources Manager. The OHS Act requires employers to provide, as far as practicable, a workplace that is safe and without risk to health. He was therefore able to complain about the conduct in the sense contemplated by PIA and Whelan. Further, his communication with Ms Free was the notification of an accusation by Mr Green and received by her. It therefore falls within the definition of ‘complaint’ contemplated in Shea.
The consumption of alcohol complaints
Mr Green’s complaint to Mr Gattereder is not a complaint that falls within section 341(1)(c)(ii) of the Act. Mr Green says he complained to Mr Gattereder by telling him that he had heard him (Mr Gattereder) the first time. As noted earlier, in my view, no such statement was made. Even if it was however, I do not regard that statement as a complaint about Mr Gattereder’s conduct or approach. It is not a complaint about any aggression. It is not a complaint about a menacing expression. It is not a complaint about bullying or harassment. It is not a grievance or compliant in the sense contemplated by Shea, nor is it a complaint Mr Green ‘was able’ to make in the sense contemplated in Whelan.
I am satisfied that the complaint Mr Green made to Ms Free in relation to this incident is a complaint that falls within the meaning of section 341(1)(c)(ii) of the Act. Mr Green was complaining of alleged aggressive behaviour and menacing expressions. The Code applies to Mr Green and identified that harassment and bullying could be raised with the Human Resources Manager. The OHS Act requires employers to provide, as far as practicable, a workplace that is safe and without risks to health. He was therefore able to complain about the conduct in the sense contemplated by PIA and Whelan. Further, his communication with Ms Free was the notification of an accusation by Mr Green and received by her. It therefore falls within the definition of ‘complaint’ contemplated in Shea.
The overspending complaints
There are four separate complaints that arise from the meeting on 14 February 2020 concerning overspending.
First, Mr Green says he made a complaint to Mr Gattereder that any discussion about overspending should happen after the meeting, that the overspending was due to the actions of Mr Gattereder and that neither he nor his departments were responsible for any overspending. These are not complaints that fall within the meaning of section 341(1)(c)(ii) of the Act. Mr Green said nothing to Mr Gattereder about his manner, loudness or aggressiveness. Nothing said by Mr Green could be properly be regarded as a complaint in the sense contemplated by Shea. These are not matters Mr Green was able to complain about in the sense mentioned in PIA and Whelan. This was simply an ordinary business discussion (albeit a vigorous and robust discussion) as to where particular costs should sit.
Second, there is the complaint Mr Green says he made to Mr Bergmuller. For the reasons set out above, no such complaint was made to Mr Bergmuller and it is not a complaint within the meaning of section 341(1)(c)(ii) of the Act.
There are then the two complaints Mr Green says that he made to Ms Free. I am satisfied that the complaints Mr Green made to Ms Free in relation to this incident are complaints that fall within the meaning of section 341(1)(c)(ii) of the Act. Mr Green was complaining of bullying and aggressive behaviour. These are complains he was able to make given the Code and the OHS Act. Further, his communication with Ms Free was the notification of an accusation by Mr Green and received by her, and therefore falls within the meaning of ‘complaint’ contemplated in Shea.
Finally, Mr Green submitted that I should draw an inference that the evidence Ms Statham may have given would not have assisted Preston Motors, and that I should take the failure to call her into account in deciding whether to accept the Mr Green’s evidence on the issues about which Ms Statham could have spoken. I decline to draw any inference of the kind sought. As I have stated above and also further below, the evidence clearly establishes that the Board made the decision to stand down all employees from employment, and that Mr Gattereder alone made the decision to dismiss Mr Green from employment. Any evidence about Ms Statham’s role rises no higher than the role of human resources advisor. Nothing in in the evidence establishes her as a co-participant or maker of any decision. The relevant decision-makers were before the Court and gave clear evidence about who was responsible for the making of each decision. No occasion arises to draw the inference sought in relation to the decisions to stand down employees or terminate Mr Green’s employment, or any other matter.
For the above reasons, Ms Statham was not a decision-maker in relation to decisions to stand down employees from employment, or to terminate Mr Green’s employment. The decision to stand down employees was made by the Board. The decision to dismiss Mr Green from employment was made solely by Mr Gattereder.
Was the decision to terminate Mr Green’s employment unlawful?
The evidence in relation to Mr Gattereder’s reasons for termination
In his affidavit, Mr Gattereder, deposed that ‘I dismissed Mr Green because I felt that he could no longer be trusted with sensitive information of the PM Group. That lack of trust was confronting, and not a difficulty I had with any other employee of the PM Group. This was so, particularly because of the balance between the Respondents interests and PCA which are not always in harmony… I had previously discussed my concerns around the sharing sensitive information with PCA with Mr Parletta and Mr Green during face-to-face conversations in Chadstone in January 2020…’. Mr Gattereder further deposed that ‘my decision to dismiss Mr Green was unrelated to any complaints that he made about me. Indeed, I was not aware that he had made such complaints’. Mr Gattereder did not depart from this evidence under cross-examination.
Other evidence before the Court corroborates Mr Gattereder’s evidence as to the reasons for termination of employment. For example:
(a)Mr Gattereder sent an email to Ms Statham at 9.03pm on 28 March 2020 informing her of Mr Green’s call with Mr Murray. That email records that Mr Gattereder was ‘very disappointed’ with the disclosure of information to PCA and that an investigation would be initiated. No other reason is advanced in that correspondence for commencing any investigation into Mr Green. No investigation was commenced before the point in time that Mr Gattereder became aware of the disclosure of information to PCA.
(b)Mr Green was given a letter on 30 March 2020 informing him of the workplace investigation. That letter identifies that the investigation into his conduct is occurring because of ‘your alleged conduct of prematurely notifying Porsche Cars Australia Pty Ltd (Porsche) of the decision by the PM Group to temporarily stand down employees as a result of the impacts on the business of the COVID-19 pandemic (Confidential Information) and whether this amounts to a breach of your employment agreement dated 18 May 2018’. The same letter records that ‘As a senior employee of the PM Group you are placed in a position of trust and confidence. The allegation that you have divulged information of such importance is extremely serious’. Once again, no other allegation is raised against Mr Green in the letter or given as a reason for commencing the investigation.
(c)Ms Statham’s file note of the meeting with Mr Green is in evidence. That record discloses that what was discussed with Mr Green was the disclosure of information about the shutdown to PCA.
(d)The letter informing Mr Green of the termination of his employment records that Mr Green has engaged in conduct amounting to serious misconduct in breach of his employment agreement because he disclosed confidential information to Mr Murray. The letter also records the consequences of that disclosure which include the negative impact on team members, and the reputational damage with PCA. The letter further records that Mr Gattereder had ‘lost all trust and confidence in your ability to protect Confidential Information and act in the best interests of the PM Group going forward’.
(e)Mr Gattereder’s evidence (which I accept) that he was not aware of any complaints made by Mr Green, with the consequence such complaints could not have influenced the decision to dismiss.
Mr Green submitted that the Court should not accept Mr Gattereder’s evidence as to why his employment was terminated. A number of matters were advanced commencing at paragraph [95] of Mr Green’s written closing submissions.
The primary submission advanced by Mr Green is that the information disclosed by Mr Green to PCA was not truly confidential. That submission was advanced on various bases including that the information was in the public domain, there was not a confidentiality direction in place in relation to the information disclosed and that Mr Green was in any event required to disclose the information to PCA because of an earlier instruction or because he was required to do so under the Franchise Agreement.
Mr Green also submitted that Mr Gattereder’s evidence about the dismissal should not be accepted because of the temporal proximity of the ‘complaints’ to the dismissal, the fact that Mr Tomljanovic was not dismissed for disclosing information to PCA similar to that disclosed by Mr Green, and the inherent likelihood that Ms Free communicated the complaints she received to Mr Gattereder.
I deal below firstly with the submissions in relation to whether the information was confidential before examining the other submissions made by Mr Green.
Did Mr Green disclose confidential information to PCA?
Clause 29 of Mr Green’s employment contract deals with confidentiality. Under clause 29.1 of the contract, Mr Green agreed and undertook that ‘at all times during and after [his] employment under this Agreement, [he] will keep confidential and not disclose any Confidential Information to any person other than in the performance of their duties, as required by law, with the prior written consent of the Company’. ‘Confidential Information’ is defined in clause 1 of the employment contract as meaning ‘all information regarding the Company’s Business or Clients which is not in the public domain, including… all information and data… used in or concerning the Business and the operations…including without limitation… commercial information’. ‘Business’ is defined in clause 1 of the Agreement to mean ‘the business of providing motor vehicle services (including but not limited to retailing, servicing, repairing and past distribution) through a network of motor vehicle dealerships and warehouses’.
It is also relevant to note clause 29.5 of the employment contract. That clause provides that ‘if there is uncertainty about whether the information is Confidential Information or lawfully within the public domain, the Parties agree that the information is Confidential Information unless the Company agrees otherwise in writing’.
The first issue to consider is the information that was disclosed. Mr Green says he told Mr Murray that the business potentially might be shut down. Mr Murray was not called to give evidence. I accept what Mr Green says he told Mr Murray. That evidence accords Mr Gattereder’s note of his conversation with Mr Murray. Mr Green therefore told Mr Murray the business of Preston Motors might potentially be shut down.
The next issue is whether information identified falls within the definition of ‘confidential information’ contained within the employment agreement. Leaving to one side for the moment whether the information was already in the public domain, I am satisfied that the information disclosed is information that is otherwise caught by the definition of ‘confidential information’ i.e. it is information regarding the Company’s Business, or information concerning the business and the operations, or commercial information.
Mr Green advances a number of reasons as to why the information is not confidential and I turn to those now.
Mr Green submits that the information was effectively already in the public domain. This submission is based on various videos that were prepared by Preston Motors to update employees. The videos were circulated to employees via WhatsApp. The videos were also uploaded to You Tube. No serious contention was advanced that videos loaded onto You Tube are not available to the public.
I have viewed each of the videos. The video of 19 March 2020 is not presently relevant. It does not refer to the stand down of employees. In the video of 23 March 2020 (and provided on 24 March 2020), Mr Gattereder discusses the unlikely possibility that businesses are forced to close. In his message, Mr Gattereder discusses the potential stand down of all employees. This information is shared with a qualification that stand down will only occur if a full lockdown of non-essential services ‘are implemented by the Government!’. In the video of 27 March 2020, Mr Gattereder informs employees they are to be stood down.
Mr Green told Mr Murray about the potential stand down of employees. That employees were to be potentially stood down was, it is contended, a matter that was already in the public domain because it was contained in the video of 24 March 2020. I am not able to accept that the content of the video of 24 March 2020 means the potential stand down of employees was already in the public domain when Mr Green made his disclosures to Mr Murray. The video of 24 March 2020 discussed the stand down of employees in the context of a direction by Government. The disclosure made by Mr Green to Mr Murray contained no such qualification. The information disclosed was therefore qualitatively different. It was that Preston Motors may stand down employees without a direction from Government.
Mr Green in his evidence also refers to the video of 27 March 2020. Mr Green in his first affidavit provides hearsay evidence that a customer called him to tell him ‘on or around 27 March 2020 to let me know he had watched the video released earlier that afternoon’. This is seemingly a reference to the video of 27 March 2020. Mr Gattereder’s evidence is that the 27 March 2020 video was uploaded to You Tube at the same time as a hosting link for the video was sent in a WhatsApp message. I note the timestamp on the WhatsApp message sent on 27 March 2020 is 2.57pm.
On this issue, as I have already indicated in these reasons, I prefer the evidence of Mr Gattereder. He says the video was uploaded at the same time as the hosting link for the video was sent, and this is the only direct evidence as to when the video was uploaded. Moreover, the email from Mr Gattereder to the MLT at 10.09am on 27 March 2020 supports the position that the 27 March 2020 video was prepared sometime after the conclusion of the 11am conference call. On the basis of the evidence before me, I find that the 27 March 2020 video was loaded to You Tube at around 2.57pm on 27 March 2020. This was after the time that Mr Green spoke to Mr Murray. Consequently, the 27 March 2020 video was not in the public domain at the time Mr Green made his disclosure to Mr Murray.
I have considered whether the information disclosed by Mr Green was already in the public domain because it was put there by Mr Tomljanovic. While it seems that Mr Tomljanovic may have disclosed information about the stand down, there is not clear evidence before this Court that he disclosed that information prior to Mr Green disclosing it.
For the above reasons, the information Mr Green disclosed was not in the public domain.
Mr Green next submits that there was never any clear, express written direction that the stand down or potential stand down of employees was not to be communicated. That submission is in my view misplaced. There did not need to be any specific additional direction. Mr Green had obligations under his contract of employment that he was required to comply with. The contract not only clearly specified what information was confidential information, but also dealt with the situation where there was a doubt about whether such information was confidential. In such a situation, the information was to be regarded as confidential. Moreover, I consider the information was inherently confidential and that Mr Green, as a senior executive in the business, would have known that. What was being contemplated was the stand down of employees and the closure of most business operations in the absence of a direction from the Government. That is information that would clearly be of interest to competitors and suppliers.
Furthermore, if there was any doubt (and I add what follows in the event that the call between Mr Murray and Mr Green actually occurred at the time Mr Gattereder’s note records), once a decision was made by the Board to stand down employees, it was made clear to managers (including Mr Green) by Mr Gattereder that a specific timeline had been prepared for the communication of the stand down to employees. Mr Gattereder had made it clear at a meeting of the MLT (which Mr Green attended) at 11am on 27 March 2020 that while a broader communication would be sent to stakeholders, the first communication needed to be within the PM Group and to staff.
Mr Green next contends he regularly provided information to PCA which would be confidential. There is little doubt that Mr Green in his role regularly provided information to PCA. The evidence does not establish, however, that Mr Green was providing confidential information of Preston Motors to PCA from time to time, or at all. Various pieces of email correspondence were tendered to support the proposition that Mr Green was regularly providing confidential information to PCA. I observe that those emails largely deal with requests by Preston Motors for stock. Such requests are not unusual, given the relationship between these parties, and would not constitute confidential information in the context of that relationship. An email from Mr Murray that was tendered attaching minutes of a dealers meeting is information coming from PCA to Preston Motors, and not vice versa. While Mr Green in his second affidavit seeks to portray that no limits were placed on what he disclosed to PCA, he also says that ‘I never shared anything inappropriate or confidential with PCA’. There is an obvious tension between these positions which in my view indicates Mr Green was aware that there were limits on what could be shared with PCA. Moreover I note Mr Green had been warned before about disclosing information to PCA. I rely on my findings later in these reasons. Given that warning, Mr Green ought to have known sharing information of the type he did with PCA would not have met with Mr Gattereder’s approval and was likely in breach of his employment obligations.
Mr Green submits the information he provided to PCA was not confidential because he was acting in accordance with a subsisting direction to share that information. In this respect, Mr Green points to the Business Continuity Plan prepared by Preston Motors for the pandemic and circulated by Mr Gattereder on 18 March 2020 and 20 March 2020. In that document, employees including Mr Green are to ‘identify the relevant stakeholders such as suppliers, service providers and customers, and key messages for each stakeholder group; and begin a dialogue with them on potential contingency measures during a virus outbreak’. There is no dispute that PCA is a supplier.
I do not accept that the Business Continuity Plan constituted a direction or authorisation to Mr Green to make a disclosure of the type he made to Mr Murray at the time he made it to Mr Murray. It does not in terms authorise the disclosure of information relating to the stand down or potential stand down of employees. At its highest, it calls for a dialogue to commence on a number of potential contingency measures. Even if I am wrong about that, however, I note the following. First, Mr Green was aware from previous discussions with Mr Gattereder (see below) that there was a sensitivity about sharing information with PCA. He had been warned about doing so. Second, the submission does not overcome the express terms of Mr Green’s employment contract. Third, to the extent it might be the case that the call between Mr Murray and Mr Green occurred at around 2pm on 27 March 2020 as recorded by Mr Gattereder, whatever was contained in the Business Continuity Plan was superseded by the express instruction Mr Gattereder gave to employees including Mr Green at 11am on 27 March 2020.
An aspect of the submission above advanced by Mr Green is that given his designation as an Essential Person under the Franchise Agreement, that agreement required him to disclose the stand down of employees to PCA. I do not accept that submission. I am unable to see anything in the Franchise Agreement that required Mr Green to make the disclosure that he did to Mr Murray at the time he made it. The fact that PCA itself may have been bound to keep information of Preston Motors confidential does not assist one way or the other.
When all of these matters are considered, in my view, the information disclosed by Mr Green to Mr Murray falls within the definition of ‘Confidential Information’. The information was not in the public domain at the time Mr Green spoke to Mr Murray. Mr Green contravened clause 29 of the employment contract when he made the relevant disclosure to Mr Murray. Preston Motors did not breach Mr Green’s contract of employment by terminating his employment for revealing confidential information.
Other contentions as to why Mr Gattereder’s evidence ought not be accepted
Mr Green contended that the Court should not accept the reasons advanced by Mr Gattereder for terminating Mr Green’s employment because another employee, Mr Tomljanovic, also disclosed information to PCA. Mr Tomljanovic’s employment was not terminated by Preston Motors. Mr Green submitted that this supported his contention that his employment was terminated because he had, or had exercised, workplace rights.
Mr Gattereder was questioned about his treatment of Mr Tomljanovic. Under cross-examination, Mr Gattereder accepted that Mr Tomljanovic was questioned, and ultimately received a warning, for disclosing information to PCA. He also accepted Mr Tomljanovic had not made any complaints. In the witness box, Mr Gattereder explained that he treated Mr Green differently from Mr Tomljanovic because Mr Green was one of the most senior members of the management team and Mr Gattereder’s ability to trust him was important, whereas Mr Tomljanovic did not hold such a senior position. I accept Mr Gattereder’s evidence about these matters. It is unremarkable that a person in Mr Gattereder’s position would place a very significant emphasis on trusting a senior employee when compared to a less senior employee. Furthermore, it is not unexpected that Mr Gattereder would take a firmer view about Mr Green’s conduct given that Mr Green had been previously warned by him about the disclosure of information to PCA.
Mr Green also made the following submissions as to why Mr Gattereder’s evidence should not be accepted. First, the temporal proximity of his complaints and inquiries to the adverse action taken against him. Second, the inherent likelihood that Ms Free communicated the complaints she received to Mr Gattereder.
I do not accept that it is inherently likely that Ms Free communicated Mr Green’s complaints to Mr Gattereder. Mr Gattereder has given direct evidence that he did not know of any complaints. He is a credible witness and I accept his evidence. Moreover, if anything is inherent, it seems to me that in many instances to which I have earlier referred it is inherently likely that Ms Free did not communicate the complaints to Mr Gattereder. It is, for example, inherently unlikely that Ms Free would raise with Mr Gattereder the email Mr Green received relating to the provision of the Porsche Macan to Essendon Holden. On any objective view, that email is not ‘abusive’. It may also be considered to be inherently unlikely that Ms Free would raise with Mr Gattereder the matters concerning consumption of alcohol in the workplace and Mr Peter’s dress sense. These were legitimate matters for Mr Gattereder to raise with Mr Green and nothing in Mr Green’s accounts of those meetings to Ms Free discloses the use of abusive or inappropriate language. As I have noted above, in my view, on many of the occasions when Mr Green said he complained to Ms Free, there was in truth nothing to complain about.
On the above issue, I also find for completeness that when Mr Gattereder says he was not aware of any complaints made by Mr Green, that includes complaints Mr Green says he made directly to Mr Gattereder. As I have found above, nothing Mr Green said directly to Mr Gattereder could properly be regarded as raising a complaint.
As to temporal proximity of the complaints and inquiries to the adverse action, the following should be noted. First, not all of the complaints arose close in time to the adverse actions. Second, to the extent the issue of temporal proximity is raised, there was a real temporal proximity between the disclosure of the information by Mr Green to PCA, and the decision to dismiss Mr Green from employment. That in my view confirms the seriousness with which Preston Motors regarded Mr Green’s conduct.
Mr Green submitted that the letters given to him on 30 March 2020 (the letter notifying him of the investigation and the letter terminating his employment) identify the exercise of his workplace rights and are therefore a prohibited reason for the commencement of the investigation process and ultimately the dismissal. I accept that the letters identify Mr Green’s discussions with Mr Murray as being the basis for the commencement of the investigation process and a reason for the dismissal. Crucially, however, the complaint and inquiry to Mr Murray is not a complaint or inquiry of the type contemplated by section 341 of the Act. Further, neither the investigation nor the dismissal was effected because Mr Green made a complaint or inquiry to Mr Murray. The investigation was commenced, and the dismissal ultimately effected, because Mr Green had informed Mr Murray about the stand down or potential stand down of employees, a sensitive matter with PM Group, and by doing so disclosed confidential information in breach of his employment contract.
Other matters
I have considered whether Preston Motors has discharged the reverse onus in the event I am wrong in my conclusion that Mr Green breached clause 29 of his employment contract. In my view, even if I am wrong in my conclusion that Mr Green breached clause 29 of his employment contract, Preston Motors has discharged the reverse onus. My reasons for so concluding are as follows.
Whether or not Mr Green breached his employment contract, it is abundantly clear on the evidence that Mr Gattereder did not want anything to be communicated to others before employees were informed. Mr Gattereder made that clear to employees including Mr Green. Mr Green acted contrary to the express instructions given to him and disclosed the information to PCA. It is the substance and act of the disclosure, rather than whether it technically falls within the contract of employment, that was the reason for Mr Green’s employment to be terminated. So much is clear from Mr Gattereder’s evidence and from the surrounding events, including the investigation and the letter of dismissal.
Other evidence supports the conclusion that Mr Gattereder took disclosures to PCA seriously. PCA may not have been a competitor to Preston Motors, but this was a commercial relationship. Mr Green knew Mr Gattereder had a difficult relationship with PCA – the notes he prepared for his meeting with Mr Bergmuller evidence this. Mr Green had previously been warned about disclosing confidential information to PCA. Mr Green does not deny he was warned, but says this was delivered in a ‘smoke and dagger’s’ fashion by Mr Gattereder. I reject that evidence. It is not consistent with the way Mr Gattereder communicates or the way he gave evidence in the witness box. These matters, in my view, indicate that Mr Gattereder was always going to take a disclosure to PCA seriously, irrespective of whether the information was considered to be truly confidential in the sense contemplated by the employment contract.
There is then the other reason given by Mr Gattereder for the termination of Mr Green’s employment. It is that he could no longer trust Mr Green with sensitive information. Mr Gattereder’s evidence before the Court that he could no longer trust Mr Green with sensitive information is something he refers to in the letter of termination given to Mr Green. In the termination letter, Mr Gattereder states that he has lost all trust and confidence not only in the ability of Mr Green to protect confidential information but also to act in the best interests of the PM Group going forward. The reference to Mr Green not acting in the best interests of Preston Motors is an important point. Properly construed, Mr Gattereder is saying (particularly when read with the other parts of the letter) that irrespective or in addition to whether Mr Green abided by his obligations of confidentiality, Mr Gattereder has formed the view Mr Green is not acting in Preston Motors best interests and he has lost trust in Mr Green because sensitive information has been given to PCA. The contemporaneous documentary evidence therefore supports the reason advanced by Mr Gattereder for the dismissal of Mr Green.
Conclusion
For all of the above reasons, Preston Motors has discharged the onus cast upon it under section 361 of the Act in respect of Mr Green’s termination of employment claim. Mr Green was not terminated because he had, had exercised, or sought to exercise, workplace rights. His employment was not terminated to prevent him from exercising workplace rights. His employment was not terminated on account of a breach of clause 29 of the employment contract to prevent him from being given notice, or payment in lieu of notice. Rather, his employment was terminated because he disclosed confidential information to PCA in breach of his contract of employment or alternatively, because he disclosed sensitive information to PCA. He was also terminated from employment because Mr Gattereder had lost trust and confidence in him because of the disclosures to PCA.
Was the decision to stand down Mr Green from employment unlawful?
This was a decision made by the Board.
Mr Bergmuller’s evidence was that he voted in favour of standing down all employees based on the email from Mr Gattereder on 26 March 2020 and the recommendations made by Mr Gattereder. Mr Parker’s reasons for voting for the stand down of all employees were economic necessity (reduced trading activity and the prospect of further COVID 19 restrictions) and to mitigate the effects of the COVID 19 pandemic on the business. Mr Auswild deposed that he voted in favour of stand down in order to support Mr Gattereder, because he anticipated further restrictions, wanted to ensure the business remained viable and because he was concerned about the duty of care the business owed to stakeholders. Mr Hamilton voted in favour of stand down on the basis of the explanation given by Mr Gattereder, had confidence in Mr Gattereder and believed it was a safe and sensible decision. Mr Smith is not entitled to vote at Directors meetings and did not vote on this occasion. He says he was not asked to contribute to any discussion involving the stand down of employees at the Board meeting and further, except for the Board Meeting, he was not involved in any other discussions in relation to the stand down of employees at Preston Motors.
A number of the directors, as noted above, voted in favour of stand down because, among other things, they supported Mr Gattereder, or accepted his recommendations. Mr Gattereder’s evidence as to why he recommended stand down therefore becomes important. Mr Gattereder’s evidence is that he recommended stand down of all employees to the Board because of, among other things, his view about the rapid decline in sales leads, service bookings, sales volumes, and that continuing to trade was not commercially viable. It was his expectation that some businesses in the group could continue to trade. His reasons are also disclosed in the email that he prepared and sent to the Board on 26 March 2020.
Mr Green was cross-examined about the Board’s decision to stand him down from employment. Mr Green accepted that he was not the target of the stand down.
There is little doubt when all of the evidence is considered that there was a disagreement between Mr Green and Mr Gattereder as to whether stand down was necessary. It is apparent that Mr Green believed the business could continue to trade. Mr Gattereder has a different view. The dispute extended, as I have noted above to an active disagreement about whether certain business data supported the implementation of a stand down.
As I have noted earlier, I consider Mr Gattereder to be a truthful, credible witness. I have nevertheless considered whether the reasons advanced by Mr Gattereder for recommending the stand down to the Board are genuine. In my view, the reasons Mr Gattereder gives for recommending a stand down to the Board (both in his evidence before the Court, and his email to the Board on 26 May 2020) reflect genuinely his reasons for recommending the stand down. There is simply nothing to suggest that Mr Gattereder was aware of any complaints made about him or to him, that he had any awareness of any workplace rights or that he acted with a view to prevent any exercise of workplace rights. Mr Gattereder acted, out of concern he held for the financial performance of the business and the obligations owed to stakeholders.
I have considered the evidence of the Board members who voted to stand down the business. Insofar as members of the Board acted on Mr Gattereder’s recommendation, the fact that they did so does not mean that they acted for a proscribed reason. Insofar as members of the Board acted for other reasons, there is nothing before me to suggest that the reasons for so acting were for any of the reasons proscribed by section 340 of the Act.
In respect of the findings above, the surrounding evidence overwhelmingly supports the evidence given by the Board members and Mr Gattereder as to the reasons why all employees including Mr Green, were stood down from employment. That evidence is as follows:
(a)The COVID 19 pandemic had reached Australian shores and by March 2020 was having a profound effect on many businesses and employees.
(b)Governments, including the Victorian Government, were considering the nature and extent of restrictions to be imposed on economic activity in order to protect public health. It is irrelevant as to exactly what the restrictions were at a particular point in time. Many businesses were taking steps to assess whether to continue to trade and the overwhelming evidence is that Preston Motors was undertaking those assessments throughout March 2020.
(c)Business continuity planning was taking place within Preston Motors from at least 12 March 2020, when Mr Green sent an email to Mr Gattereder with contingency plans. It is evident that business continuity planning, including the frequent meetings of the MLT during March 2020, continued to develop at pace during this period and the stand down of employees was a matter under active close consideration for a period of time owing to prevailing business conditions and likely public health restrictions on activity. There is nothing to suggest that stand down of employees (including Mr Green) was occurring for any other reason.
(d)Mr Gattereder’s email to Board of 26 March 2020 is a critical document because it was relied on by the Board. That document discloses only commercial reasons for the decision to stand down all employees of Preston Motors. It singularly fails to mention any employee, including Mr Green. It certainly does not mention any complaints made by Mr Green or any workplace rights that Mr Green may have had, had exercised, was proposing to exercise or to prevent the exercise of such rights.
(e)The minutes of the Board meeting produced by Preston Motors refer expressly to ‘Implementation of Covid 19 BCP stage 2’ activity and referred to the email of Mr Gattereder in recording the Board decision to stand down the entire workforce for a period of six weeks. In other words, the minutes of the Board meeting support the evidence given by Board Members that commercial considerations relating to the COVID 19 pandemic were the reason for the stand down of all employees.
(f)There is no evidence that the Board considered any individual employee, including Mr Green, when it came to considering whether to stand down all employees.
(g)Critically, the Board decided that all employees – ‘the entire workforce’ - was to be stood down. This was not an action directed to or designed to target Mr Green because of some workplace right he had or proposed to exercise, or to prevent the exercise of such right. All employees were affected.
In summary, I find that the Board made the decision to stand down the entire workforce of Preston Motors for business reasons relating to the COVID 19 pandemic. The decision to stand down the entire workforce was not made by the Board (or recommended to the Board by Mr Gattereder) because Mr Green had a workplace right, proposed to exercise workplace right, or to prevent Mr Green from exercising a workplace right. The reverse onus has been discharged.
WAS MR GREEN ENTITLED TO NOTICE OF TERMINATION OF EMPLOYMENT?
Section 117 of the Act entitles Mr Green to notice of termination, or payment in lieu of notice. Clause 31 of Mr Green’s employment contract also entitles Mr Green to notice of termination.
Notice of termination is not required to be given under section 117 of the Act if an employee’s employment is terminated for serious misconduct. Similarly, clause 31.5 of Mr Green’s employment contract entitled Preston Motors to terminate Mr Green’s employment without notice on the grounds of, among other things, serious misconduct. Under the contract, serious misconduct includes breaches of confidentiality.
For the reasons set out above, Mr Green was terminated from employment because he breached clause 29 of his employment contract by disclosing confidential information to PCA. In such circumstances, Mr Green is not entitled to notice of termination under either section 117 of the Act, or under the contract of employment.
This aspect of the claim must also be dismissed.
DISPOSITION
Mr Green has not made out the claims in the Statement of Claim. Accordingly, I will order that the proceedings be dismissed.
| I certify that the preceding two hundred and twenty-six (226) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Blake. |
Associate:
Dated: 25 March 2022
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