Haigh v Bradken Resources Pty Ltd

[2013] FWC 7493

[2013] FWC 7493 Note: An appeal pursuant to s.604 (C2013/6494) was lodged against this decision - refer to Full Bench decision dated 24 January 2014 for result of appeal.

FAIR WORK COMMISSION

DECISION

AND

REASONS FOR DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

Mr Brett Haigh
v
Bradken Resources Pty Ltd T/A Bradken
(U2012/4952)

COMMISSIONER CLOGHAN PERTH, 3 OCTOBER 2013

Unfair dismissal - remedy.

[1] On 28 June 2013, the Full Bench delivered its decision [2013] FWCFB 2918 in an appeal against decision [2012] FWCA 9780 of Commissioner Williams. Commissioner Williams’ decision related to an application by Mr Brett Haigh (Applicant) seeking a remedy for unfair dismissal from his employment with Bradken Resources Pty Ltd (Employer).

[2] The Full Bench found that the Employer’s decision to dismiss the Applicant was harsh in all of the circumstances, and accordingly, the dismissal unfair.

[3] The Full Bench decided not to determine the appropriate remedy but remitted the matter to me for consideration and determination.

[4] On 29 July and 2 August 2013, I convened conferences of the parties to determine whether a remedy could be reached by agreement. No agreement was reached.

[5] To assist in a fair, efficient and effective determination of the appropriate remedy, I issued procedural directions on 7 August 2013. I also indicated to the parties that, should they wish, they could make supplementary oral submissions or challenge the written submissions by oral evidence. The Applicant made such a request.

[6] On 17 September 2013, the Applicant represented himself. The Employer was represented by Mr D Jones, Senior Employee Relations Consultant, Chambers of Commerce and Industry of Western Australia (Inc). Mr A Birch, Manufacturing Manager, gave evidence on behalf of the Employer.

[7] At the conclusion of the hearing, I reserved my decision. This is my decision and reasons for decision.

APPLICANT’S CASE

[8] The Applicant seeks the primary remedy of reinstatement of employment “and continuity of employment”.

[9] A summary of the Applicant’s case is as follows:

● on or around October 2008, an employee of the Employer was dismissed which was subsequently found to be unfair. The employee was reinstated on 14 January 2009;

● the Employer’s only advanced rigger resigned on 19 July 2013 and the Employer is currently seeking to employ an advanced rigger;

● the Applicant sought and obtained a permanent afternoon shift with the Employer to facilitate attendance at his daughters’ schooling activities with whom he does not live;

● the permanent afternoon shift has enabled Mr Haigh to become a member of a not-for-profit organisation which assists mothers and fathers to navigate separation;

● his home is approximately 12 kilometres from the Employer’s workplace;

● he has sought reinstatement since commencement of proceedings. He acknowledges that the Employer has also resisted this proposal for the duration of proceedings;

● if reinstatement is not ordered, he would not be able to achieve and access long service leave;

● he relies on the decision of Commissioner Riordan in Fisher and ANZ Banking Group Ltd [2013] FWC 347 (Fisher);

● an order to restore lost pay is appropriate because “up until the appeal decision [was] handed down, the applicant was not in a position to seek employment as he was seeking medical attention relevant to his situation...”;

● he has not breached any of the Employer’s policies in his period of employment;

● since the appeal decision was made, he has sought employment in businesses close to his home. There have been no vacancies and permanent afternoon is unlikely which “would be a significant disadvantage to the applicant’s contact to his children and his community service with the organisations he assists”; and

● if the Commission finds that reinstatement is not appropriate, the maximum compensation should be applied as a remedy.

EMPLOYER’S CASE

[10] The Employer opposes reinstatement for the following reasons:

● the Applicant has not expressed any contrition for the conduct which led to the dismissal;

● in Fisher, the applicant apologised for her conduct and promised not to breach ANZ Bank policies in the future;

● the statement that Mr Haigh is on friendly terms with everyone at the site is both self serving and untrue;

● the reasons given by Mr Haigh for reinstatement are self serving;

● Mr Haigh was a supervisor and some of those he supervised gave evidence in the original hearing against him; and

● in total, the Employer has lost trust and confidence in the employee and reinstatement would be inappropriate.

[11] In the event that the Commission determines that reinstatement is inappropriate, the Employer submits that:

● any amount considered should be discounted to take into account Mr Haigh’s conduct which led to his dismissal which it describes as “misconduct”;

● previous amounts to settle the claim should not be taken into consideration as they were made in private; and

● any amount should be at the lower end of the Commissioner’s discretion.

CONSIDERATION

[12] The loss of trust and confidence in the employment relationship was extensively considered in Perkins v Grace Worldwide (Aust) Pty Ltd [1997] IRCA 15 (Perkins). In Perkins, Wilcox CJ and Marshall and North JJ made the following statement:

“[t]rust and confidence is a necessary ingredient in any employment relationship. That is why the law imports into employment contracts an implied promise by the employer not to damage the relationship or destroy the relationship of trust and confidence between the parties, without reasonable cause: see Burazin v Blacktown City Guardian Pty Ltd (unreported, Industrial Relations Court of Australia, Full Court, No. 606/96, 13 December 1996). The implication is not confined to employers, it extends to employees: see for example Blyth Chemicals Ltd v Bushnell (1933) 49 CLR 66 at 81-82 and North v Television Corporation Ltd (1976) 11 ALR 599 at 609. So we accept that the question whether there has been a loss of trust and confidence is a relevant consideration in determining whether reinstatement is impracticable, provided that such loss of trust and confidence is soundly and rationally based.

...

Each case must be decided on its own merits. There may be cases where any ripple on the surface of the employment relationship will destroy its viability. For example the life of the employer, or some other person or persons, might depend on the reliability of the terminated employee, and the employer has a reasonable doubt about that reliability. There may be a case where there is a question about the discretion of an employee who is required to handle highly confidential information. But those are relatively uncommon situations. In most cases, the employment relationship is capable of withstanding some friction and doubts. Trust and confidence are concepts of degree. It is rare for any human being to have total trust in another. What is important in the employment relationship is that there be sufficient trust to make the relationship viable and productive. Whether that standard is reached in any particular case must depend upon the circumstances of the particular case. And in assessing that question, it is appropriate to consider the rationality of any attitude taken by a party.”

[13] In Regional Express Holdings Limited trading as REX Airlines v R Richards[2010] FWAFB 8753, the Full Bench stated the following:

“[26] Whenever an employer dismisses an employee for misconduct, assuming the employer is acting honestly, there is an implied loss of trust and confidence in the employee. If it is subsequently found that the termination was harsh, unjust or unreasonable it is appropriate to consider whether the relationship can be restored if the employee is reinstated. That question cannot be answered solely by reference to the views of management witnesses. All of the circumstances should be taken into account.”

[14] In this application, the Applicant’s offer of employment required him to work in a safe and productive manner in accordance with the Employer’s Occupational Health and Safety Policies and Standards 1. As a Leading Hand, Mr Haigh had attended a number of safety training courses2 and gave evidence that safety was one of his main priorities3.

[15] On 12 December 2011, an incident occurred in which an employee refused to assist Mr Haigh cut a large flat steel plate as the employee considered it unsafe. Mr Haigh directed another employee to assist him. The initial employee made a complaint concerning Mr Haigh’s actions.

[16] The Employer conducted an investigation into Mr Haigh’s actions and he was stood down on full pay on discrimination and safety grounds 4.

[17] Mr Haigh was required to provide a response in writing as to why his employment should not be terminated for a serious breach of safety procedures.

[18] The Incident Report describes the incident as a “near miss” and that, “the plate should have been cut in a flat position and not on a crane”. According to Mr Gorringe, Fabrication and Machining Manager, the plate should have been placed on a bench or trestles and cut safely.

[19] The Incident Report and Investigation documentation variously describes, from the Employer’s perspective, the task being carried out in such terms as “inadequate set up”, “failure to follow procedures”, “using equipment in an unsafe manner”, “poor judgement”, “inadequate task planning” and “failing to follow instructions”. In short, there is a significant emphasis upon safety.

[20] The Employer’s show cause letter of 15 December 2011 refers to Mr Haigh committing a “serious breach of the Employer’s safety procedures” 5. In response, Mr Haigh states that the “plate was not suspended”6. Notwithstanding, Mr Haigh’s response, he was dismissed on 28 December 2011 for a serious breach of the Employer’s safety procedures7.

[21] Mr Haigh conceded that the Employer aspires to a high safety standard and has a culture of safety in the workforce 8. Mr Haigh agrees that normal procedure for cutting plates of that size is on a plasma bed or a trestle9.

[22] In the initial hearing, the issue arose as to whether the plate was suspended or not. Mr Haigh gave evidence that the plate was not suspended but on the ground, and safe to cut 10. However, even if it was suspended, from his perspective, it would not be unsafe11.

[23] I have taken some time to address this issue of safety because Mr Haigh was dismissed for a serious breach of safety and was a key consideration in the Decision in first instance and raised during the appeal.

[24] At the appeal, when Mr Haigh was asked whether the cutting of the plate could have been done in a different way which made it safer, he responded, “it could have been, sir, but it doesn’t say that it was unsafe” 12.

[25] In such circumstances, I have a situation in which the Applicant acknowledges the Employer’s model of a high standard of safety but adopts, in thought and action, an approach in which he overlooks the Employer’s culture and takes into account his view of safety. For the Employer, it is not the incident itself which is troubling but the lack of recognition by Mr Haigh that it could, and should have been, done more safely. It is this factor, and more generally, that Mr Birch gave evidence as follows:

“I believe that the trust relationship is broken. I believe Mr Haigh has never admitted that the incident was unsafe which leads me to believe that in the case of reinstatement he could well do something similar again, and I believe in a high risk engineering environment, if somebody is terminated on safety grounds, if that person were to be reinstated, it would send a poor message to other workers in regards to the safety culture we’re trying to have on site. So we’ve worked very hard – I’ve been there now nearly ten years in that position. We’ve worked very hard on the safety culture on site to try and reduce the risks as far as practically possible and I believe for those reasons that reinstatement would not be appropriate.” 13

[26] While the Commission may be sympathetic to the circumstances in which the Applicant finds himself in following his dismissal, the Employer’s loss of trust and confidence cannot, particularly as it relates to safety, be set aside because vacancies exist or another employee may have been reinstated in years gone by. I was not made aware of the specifics of these matters, however, in my view that is not the proper test. Further, I am not convinced that the proper test, in such circumstances, is only the employee’s domestic circumstances.

[27] The Employer resists reinstatement of Mr Haigh because, in the past and it fears in the future, that Mr Haigh will substitute his judgement relating to safety rather than its policies and procedures. That conclusion, from the proceedings, is soundly based.

[28] The Full Bench was not persuaded by the Applicant that the decision of Commissioner Williams was wrong in accordance with the criteria in s.387 of the FW Act with the exception that Mr Haigh was not given an adequate opportunity to respond to the allegations in accordance with s.387(c) of the FW Act.

[29] The requirement to adequately permit a response was particularly important given the imprecise nature of the safety allegations and that Mr Haigh was not present at the re-enactment of the event which led to his dismissal.

[30] Mr Haigh submits that reinstatement is appropriate for reasons associated with his domestic circumstances (including proximity to his home) and his outside of work interests. Mr Jones considers these matters “self serving”. While I am inclined to agree with Mr Jones, they were not contested as facts.

[31] The Concise Oxford English Dictionary (COED) defines “trust” as, among others:

“firm belief in reliability, honesty, veracity, justice, strength, etc, of a person or thing”; “accept without evidence”; and “believe in, rely on the character or behaviour of”.

[32] The COED defines “confidence” as “assured expectation” and “firm trust”.

[33] I am satisfied, based on the plain and ordinary meaning of “trust” and “confidence” and the evidence and submissions, that the Employer has lost trust and confidence in Mr Haigh and a continuation of the employment relationship. In such circumstances, it would be inapposite to elevate Mr Haigh’s domestic circumstances above the necessity of trust and confidence to make reinstatement appropriate.

[34] Having determined that reinstatement is inappropriate, it is necessary to consider whether an order for compensation is appropriate.

[35] In considering an order for compensation, I must take into account all the circumstances including the criteria set out in paragraphs (a) to (g) in subsection 392(2) of the FW Act. They are as follows:

(a) the effect of the order on the viability of the employer’s enterprise

[36] The Employer did not make any submission that an order would have any effect on the viability of the Employer’s enterprise. Accordingly, I find an order will have no effect on the Employer’s business.

(b) the length of the person’s service with the employer

[37] Mr Haigh commenced employment on 5 August 2002 and was dismissed on 28 December 2011 with five weeks’ pay in lieu of notice.

[38] A period of 9 years and 4 months is not insignificant. However, neither party made a submission as to how I should treat such a period for the purposes of an order for compensation. Except for my observations in paragraph [58], I have considered Mr Haigh’s length of service in an overall assessment of an appropriate order for compensation.

(c) the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed

[39] I have no submission or evidence to suggest that Mr Haigh would not have continued in his employment and received his normal pay entitlements if it was not for his dismissal.

[40] On the basis of the evidence and submissions, there is nothing to suggest that Mr Haigh would not have continued in his employment for an indefinite period. I do not intend to speculate as to how this may change over the foreseeable future from the perspective of both parties.

(d) the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal

[41] The Applicant submits that, from the date of his dismissal up to the decision of the Full Bench on 28 June 2013, he was not in a position to seek employment. As the Applicant was unfit for work, the Employer contends that the Commission cannot grant orders for restitution of wages. In response, the Applicant relies upon Fisher.

[42] Mr Haigh relies upon correspondence from a Specialist Clinical Psychologist as evidence of his inability “to seek employment as he was seeking medical attention relevant to his situation”.

[43] The “situation” is assessed by his Psychologist as:

“in the severe range of depression (using the BD1-11) and moderate range of anxiety”.

[44] The psychological assessment dated 3 July 2013 is for a “10 Session Closure Report” for Mr Haigh’s General Practitioner. The Report, however, reveals that Mr Haigh’s unfair dismissal is only one of two “issues” which has led to his medical condition.

[45] In the absence of any other evidence, I hesitantly find that Mr Haigh’s medical condition prevented him, in part, from mitigating his loss. I say hesitantly because I have no evidence which states that Mr Haigh, despite his medical condition, could not have taken action to mitigate the loss suffered by his dismissal by seeking and obtaining employment. Further, I need to balance this psychological report with evidence provided within the cover page of Centrelink correspondence written to Mr Haigh on 24 July 2013. In the correspondence it states that “a decision has been made that you have a temporary reduced work capacity of less than 8 hours per week”. If I understand the correspondence correctly, it indicates that Mr Haigh had, and now has, capacity to do some work. However, Mr Haigh has not demonstrated any attempt by working and earning an income, to mitigate the loss suffered as a consequence of his dismissal.

[46] On the basis of the evidence, I am not satisfied that Mr Haigh did sufficient to mitigate the loss suffered by his dismissal notwithstanding his diagnosed medical condition. Accordingly, I am persuaded that any order for compensation should be reduced in accordance with this criteria.

(e) the amount of remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for compensation

[47] I have no evidence or submission that the Applicant received remuneration from other employment.

[48] It would appear that the Applicant has been receiving an allowance from Centrelink.

(f) the amount of any income reasonably likely to be so earned by the person during the period between the making of the order for compensation and the actual compensation

[49] This factor is not relevant to the extent that it can be ascertained.

(g) any other matter that the FWC considers relevant

[50] The application was made to the Commission on 13 February 2012.

[51] The decision to dismiss the application was made on 20 November 2012.

[52] On review, the Full Bench found that the Commissioner outlined the evidence and accurately summarised the case for both parties. The Full Bench found no error of fact in the Commissioner’s reasons or findings.

[53] The inescapable difficulty with applying a remedy to this unfair dismissal application is not whether reinstatement is appropriate but what has occurred from the date of dismissal on 28 December 2011 to the Decision of the Full Bench on 28 June 2013. During that period, Mr Haigh asserts that he was unable to seek work for health reasons caused, in part, by the dismissal.

[54] It is now just over 21 months since Mr Haigh was dismissed. This is a significant period of elapsed time.

[55] Mr Haigh was paid five (5) weeks’ pay in lieu of notice.

[56] It would seem to me unacceptably unjust to deprive Mr Haigh of any compensation because he was unable to seek work because of health reasons partly as a consequence of his dismissal. To take advantage of such circumstances is objectionable, in my view. However, I agree with the Employer that Mr Haigh actively chose to conduct himself the way he did and which ultimately led to his dismissal. These actions, the Full Bench found, were a valid reason for his dismissal.

[57] The Full Bench refused to speculate on what may or may not have happened had Mr Haigh been given the opportunity to be present and explain himself at the re-enactment. However, this was a course of action which the Employer chose and also cannot be ignored.

[58] It would also be inappropriate not to take into account that Mr Haigh, if he continued in employment, may have completed sufficient service to access long service leave in which he would have received 13 weeks after 10 years continuous service. At the time of his dismissal, it appears he had completed approximately 9 years and 4 months service. There is nothing to suggest that Mr Haigh would not have completed the qualifying period for long service leave; his domestic circumstances would seem to positively indicate such an intention.

[59] I have attempted to assist the parties in reaching an agreement on remedy. It is only they who have a full perspective of the situation. In the absence of such agreement, the Commission does not have a precise formula or template which it applies to remedies; it is a matter of weighing up all circumstances. I have no doubt in finding that Mr Haigh’s conduct contributed to his dismissal pursuant to s.392(3) of the FW Act. Further, whether intentionally or not, Mr Haigh has given the Employer reasonable grounds to show a lack of insight into what has happened, why he was dismissed and why reinstatement is not appropriate.

[60] In determining an amount to be ordered in lieu of reinstatement, I have adopted the approach in Ellawala 14and Sprigg15.

[61] I find that Mr Haigh would have continued employment to an unspecified date well into the future. In Mr Haigh’s circumstances, he particularly had an incentive to continue in employment for his own domestic reasons and because he would have qualified for 13 weeks long service leave approximately eight (8) months after his dismissal. In such circumstances, I am prepared to commence, as the Applicant seeks, at the maximum amount of compensation of 26 weeks.

[62] Mr Haigh received five (5) weeks payment of wages in lieu of notice. Accordingly, I find that the five (5) weeks should be deducted from the 26 weeks.

[63] In the absence of any evidence or submissions substantiating a further reduction for “contingencies”, I find it inappropriate to make a further deduction from the 21 weeks.

[64] Having arrived at 21 weeks, if I am satisfied that Mr Haigh’s misconduct contributed to the Employer’s decision to dismiss him and in accordance with s.392(3) of the FW Act, I am required to further reduce the amount. I am satisfied that Mr Haigh’s conduct did contribute to his dismissal.

[65] Having considered all the circumstances including Mr Haigh’s length of service, position as leading hand, the emphasis upon safety in the workplace and the direct causal relationship between the incident and the Applicant’s dismissal, that a further five (5) week reduction is appropriate.

[66] I consider that the 16 weeks should be reduced by a further four (4) weeks as a consequence of Mr Haigh not making reasonable efforts to mitigate his loss following dismissal. Four (4) weeks is approximately one (1) day for each week of the initial 21 weeks after the five (5) weeks payment in lieu of notice was paid to Mr Haigh.

[67] There was no submission that the order for compensation should be paid in instalments. In any event, I do not consider instalments warranted in these circumstances.

CONCLUSION

[68] For the reasons set out above and the evidence which emerged in the first instance, on appeal, and in the hearing on 17 September 2013, I am satisfied that reinstatement is not appropriate and that an order for compensation is appropriate.

[69] The order for compensation balances the criteria in s.392(2), in particular paragraph 392(2)(g) and the contributory fault provided for in s.392(3) of the FW Act.

[70] The order for compensation will be an amount of 12 weeks to be based on the average weekly earnings, excluding overtime, in the 26 weeks immediately before the dismissal. An order to this effect will be issued conjointly with this Decision and Reasons for Decision. The gross amount is to attract whatever superannuation or taxation is required at law.

[71] The amount is to be paid within 14 days of this Decision and Reasons for Decision.

COMMISSIONER

Appearances:

Mr B Haigh, the Applicant on his own behalf.

Mr D Jones of CCIWA on behalf of the Respondent.

Hearing details:

2013:

Perth,

17 September.

 1   Exhibit R3

 2   Transcript PN113 of 28 August 2012

 3   Transcript PN115 of 28 August 2012

 4   Transcript PN221 of 28 August 2012

 5   Exhibit R5

 6   Exhibit R6

 7   Exhibit R7

 8   Transcript PN349 and PN350 of 28 August 2012

 9   Transcript PN536 and PN537 of 28 August 2012

 10   Transcript PN683 of 28 August 2012

 11   Transcript PN692 of 28 August 2012

 12   Transcript PN269 of 5 March 2012

 13   Transcript PN2445 of 17 September 2013

 14   Ellawala v Australian Postal Corporation Print S5109

 15   Sprigg v Paul’s Licensed Festival Supermarket Print R0235

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