Harry Liapis v Cryovac Australia Pty Ltd T/A Sealed Air

[2016] FWC 2797

[2016] FWC 2797

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Harry Liapis
v
Cryovac Australia Pty Ltd T/A Sealed Air
(U2015/8376)

DEPUTY PRESIDENT KOVACIC MELBOURNE, 5 MAY 2016

Application for relief from unfair dismissal – harsh, unjust or unreasonable – dismissal found to be fair – application dismissed.

[1] Mr Harry Liapis (the Applicant) lodged an application under s.394 of the Fair Work Act 2009 (the Act) which was received by the Fair Work Commission (the Commission) on 11 June 2015 alleging that the termination of his employment by the Cryovac Australia Pty Ltd T/A Sealed Air (the Respondent) on 2 June 2015 was unfair.

[2] The application was heard on 8 September 2015. At the hearing, Mr Marcel White of Counsel appeared with permission for Mr Liapis, while Mr David Miller of the Australian Industry Group appeared for the Respondent. Mr Liapis gave evidence on his own behalf, while Mr Wayne Harbor, the Respondent’s Employee Relations Manager; Mr Paul Tondo, a Warehouse Superintendent employed by the Respondent; Mr Michael Angley, the Respondent’s Director, Flexible Manufacturing – Australian and New Zealand (ANZ); and Mr John Newman, the Respondent’s Human Resources Operations Director – ANZ, all gave evidence for the Respondent.

[3] For the reasons outlined below, I have found that Mr Liapis’ dismissal was not harsh, unjust or unreasonable. Accordingly, his application is dismissed. An order to that effect will be issued in conjunction with this decision.

Background

[4] Mr Liapis commenced employment with the Respondent on 2 July 1990 as a graphic designer. From 2011 until the time of his dismissal, Mr Liapis was working as the Respondent’s Process Improvement Lead.

[5] In his written submissions, Mr Liapis set out a brief chronology of events that occurred during his employment with the Respondent. Key aspects of that chronology were that:

• on 14 August 2013 he received his first written warning for accepting gifts from a supplier, specifically tickets to the 2012 AFL Grand Final, in breach of company policy, including the Respondent’s Code of Conduct;



• on 28 May 2014 he received his second written warning for misconduct related to the Respondent’s Code of Conduct, with the incident that resulted in that warning pertaining to the engagement of an external contractor on behalf of the Respondent without its authorisation; and



• in May 2015, Mr Liapis commenced work for Essential Imaging while also working for the Respondent.

[6] Also in early May 2015, while Mr Angley was on leave he became aware that Mr Liapis was also working as an Account Manager for Essential Imaging. At the time, Mr Liapis was involved in a project for the Respondent which was looking at procuring an electronic document storage system. Upon becoming aware of Mr Liapis’ involvement with Essential Imaging, Mr Angley immediately asked that the project be put on hold. By way of background, as part of the project, Essential Imaging had been invited to a meeting to present a software package which would enable the Respondent to scan documents. Mr Liapis, who attended the meetings with Essential Imaging on behalf of the Respondent, did not disclose his involvement in Essential Imaging to the Respondent.

[7] Following his return from leave, Mr Angley met with Mr Liapis on 28 May 2015 and again on 1 and 2 June 2015 at which time Mr Liapis was dismissed as a result of the Respondent having lost trust and confidence in him.

The Applicant’s case

[8] Mr Liapis submitted that the Respondent did not have a valid reason to terminate his employment, adding that his dismissal was unjust because he was not guilty of the alleged misconduct and hence was unfairly dismissed.

[9] Mr Liapis in his witness statement 1 set out the background to the warnings he had received in 2013 and 2014. Mr Liapis also deposed that in May 2015 he was engaged to undertake work of an administrative nature for Essential Imaging, a business which had Mr David Harrison, National Sales Manager for Fuji Xerox, as one of its Directors. Fuji Xerox was a supplier to the Respondent. Mr Liapis further deposed that the work he undertook for Essential Imaging involved sending our marketing emails to private schools, unions, and other businesses none of which were in competition with the Respondent, adding that he was careful to ensure that any work he performed for Essential Imaging did not interfere with his work for the Respondent. Beyond this, Mr Liapis deposed that:

• on 28 May 2015 he was called into a meeting with Mr Angley to explain why he had been involved with Essential Imaging, with Mr Angley contending that his involvement was a clear case of conflict of interest;



• Mr Angley advised him that he should leave work for the day and provide details of who he sent emails to on behalf of Essential Imaging;



• he met with Mr Angley on 2 June 2015 when Mr Angley discussed how he had reached his findings that he was in clear conflict;



• Mr Angley did not specify at that meeting how he was in conflict;



• the meeting of 2 June 2015 was suspended in order for Mr Angley to consider his responses; and



• when the meeting resumed he was advised that his employment had been terminated with immediate effect.

[10] Much of Mr Liapis’ evidence in chief focused on the incidents which led to him receiving his two prior warnings. For instance, Mr Liapis attested that he was not the Respondent’s only employee to benefit from supplier largesse. Beyond that, key aspects of Mr Liapis’ oral evidence were that:

• Mr Harrison’s involvement with Essential Imaging was completely separate to his role at Fuji Xerox;



• Mr Harrison had asked him whether he would like to make some pocket money by sending out emails;



• at the time of his dismissal, there was no commercial or contractual relationship between Essential Imaging and the Respondent;



• with regard to the electronic document storage project, he was not in a decision-making role and never spoke for Essential Imaging;



• further, he did not think he was going to be Essential Imaging’s “inside man”;



• he never met alone with Essential Imaging in his capacity as an employee of the Respondent;



• his relationship with Essential Imaging came to an end when the Respondent became aware of his involvement with it;



• at the termination meeting he pleaded his case not to be dismissed;



• the termination letter made no reference to the materials he provided or to any loss sustained by the Respondent;



• he did nothing to assist Essential Imaging obtain a better deal with the Respondent;



• the Respondent was looking at other possible solutions, with Essential Imaging only one of a number of potential providers;



• there was no reason why he did not alert the Respondent to his involvement with Essential Imaging, adding that he did not think it was a big deal;



• acknowledged that no one else was aware of his relationship with Essential Imaging;



• he did not see his presence at the meetings with Essential Imaging as involving a conflict of interest, adding that he was not there to give Essential Imaging a free shot at the Respondent; and



• with regard to the incident that led to his second warning, the Respondent had made it extremely clear/crystal clear to him that the project in that instance was a waste of time and that he was not to look at the technology further.

[11] At the hearing, Mr Liapis relied on his written submissions and further submitted that:

• while there was a potential conflict of interest, that conflict did not warrant him being dismissed;



• the investigation undertaken by the Respondent had been perfunctory;



• there had been no damage to either the Respondent or its reputation as a result of his participation in the meetings with Essential Imaging;



• his actions did not constitute serious misconduct as defined in the Fair Work Regulations 2009;



• his actions, together with the two incidents which resulted in him receiving warnings, were “minor peccadilloes”;



• no weight should be attached to Mr Tondo’s evidence;



• he was not employed by Essential Imaging at the time of his dismissal;



• the Respondent had predetermined the outcome of the meeting of 2 June 2015;



• there was no evidence that he had a deciding role in selecting the successful tenderer for the electronic document storage software;



• he had an unblemished employment record with the Respondent until 2012; and



• he was seeking compensation as opposed to reinstatement.

The Respondent’s case

[12] The Respondent submitted that Mr Liapis had been dismissed as a result of a serious conflict of interest which occurred when he arranged a meeting with Essential Imaging with a view to inviting it to tender for the work with the Respondent and without disclosing to any of the Respondent’s representatives at that meeting that he was employed by Essential Imaging as their Account Manager. The Respondent further contended that it was relevant to its consideration that Mr Liapis had received two previous warnings, in August 2013 and May 2014. In short, the Respondent submitted that Mr Liapis’ conduct was sufficient to justify its loss of trust and confidence and that the termination of his employment was not harsh, unjust nor unreasonable.

[13] At the hearing, the Respondent highlighted that Mr Liapis had not been summarily dismissed, but that he had been dismissed with five weeks’ notice of termination in lieu. The Respondent further highlighted that Mr Harrison’s relationship with it had been severed as a result of the incident which lead to Mr Liapis’ dismissal. Beyond that, the Respondent submitted that:

• Mr Liapis did not appreciate the seriousness of the conflict of interest and was completely oblivious to the problem;



• with regard to the questions posed in Cementaid (NSW) Pty Ltd v Chambers 2(Cementaid), when viewed through the Applicant’s prism the answer to those questions was no, however when viewed from the Respondent’s perspective the answer to the questions was yes;



• with regard to the procedural fairness issue raised by Mr Liapis, Mr Newman’s notes of the meetings with Mr Liapis indicate that the Respondent’s concerns were discussed with Mr Liapis and that in circumstances where Mr Liapis had admitted the behaviour it was reasonable for the Respondent to conclude that it could no longer trust him;



• Mr Liapis’ submission that he saw no reason to discuss his involvement with Essential Imaging with the Respondent because he did not see it as a conflict was precisely why Mr Angley had reason for concern; and



• the incidents which Mr Liapis had previously been warned about could not be ignored.

[14] Mr Harbor deposed in his witness statement 3 that he had been asked to investigate the circumstances regarding the incident which resulted in the second warning issued to Mr Liapis, adding that other than providing his investigation report he took no further part in the disciplinary process in respect of that incident. Mr Harbor’s oral evidence was that in respect of that incident:

• the conflict stemmed from Mr Liapis’ underlying motivation; and



• Mr Liapis had initially indicated to him that the motivation was all about him gaining recognition within the Respondent but that he then backpedalled to indicate that his motivation was all about the benefits that would accrue to the Respondent.

[15] Mr Tondo deposed in his witness statement 4 that he was involved in a project looking at paperless document storage which was being managed by Mr Liapis. Mr Tondo further deposed that he attended two meetings around late April and early May 2015 with Mr Harrison representing Fuji Xerox with the purpose of those meetings to discuss the project and offer Fuji Xerox the opportunity to present the Respondent with a software package which would enable it to scan documentation. Mr Tondo also stated that he was not aware of any connection between Mr Liapis and Mr Harrison representing Essential Imaging and that Mr Liapis had not disclosed any connection to either him or the Respondent. In his oral evidence, Mr Tondo attested, among other things, that Mr Liapis was managing the project, was in favour of the Respondent adopting the system proposed by Mr Harrison and that he could not recall how Mr Harrison had come to be invited to present to the Respondent.

[16] Mr Angley deposed in his witness statement 5, inter alia, that:

• Mr Liapis had been demoted following the warning he received in May 2014, i.e. the second warning;



• in May 2015 while he was on leave he received a document which disclosed that Mr Liapis was engaged by Essential Imaging as an Account Manager;



• at the time, Mr Liapis was involved with a project on behalf of the Respondent which was looking at ways to move from hard copy/paper storage to electronic document storage;



• as part of that project, Mr Liapis had arranged to meet with Mr Harrison of Essential Imaging with a view to providing him an opportunity to present to the Respondent a software package to enable it to scan documentation;



• upon learning that Mr Liapis was also employed by Essential Imaging, he immediately asked Mr Liapis to put the project on hold until he returned from leave;



• upon his return from leave he met with Mr Liapis on 28 May 2015 at which time he made him aware of his concern about the conflict of interest, adding that upon being made aware that the meeting was to be a disciplinary meeting Mr Liapis asked that his supervisor, Mr Greg Colliver, stay as his support person;



• during the course of that meeting it became apparent that Mr Liapis was aware of, but had failed to disclose to the Respondent, a substantial and significant conflict of interest between himself, the Respondent and Essential Imaging;



• none of the Respondent’s personnel at the meetings with Essential Imaging were aware of Mr Liapis’ involvement in Essential Imaging;



• Mr Liapis explained that his attendance at the meeting with Mr Harrison was entirely coincidental, adding that he taken on the work with Essential Imaging because he was in financial difficulty and needed extra income and that he received no payments from Mr Harrison;



• the meeting was adjourned to allow the Respondent to make some further enquiries and to consider what Mr Liapis had said at the meeting, with Mr Liapis asked to provide the list of persons he had contacted on behalf of Essential Imaging;



• as part of its further investigation, the Respondent reviewed Mr Liapis’ telephone records which indicated that he had contacted Mr Harrison some 29 times over the previous three months with a substantial volume of calls being made during working hours, adding that this was a much higher level of usage than would have been reasonably expected if those communications had been limited to his role with the Respondent;



• Mr Newman subsequently spoke to Mr Harrison and was advised that it was Mr Liapis who had contacted him and that Mr Liapis had been paid for the work he had performed for Essential Imaging;



• at the time, Mr Harrison was representing Fuji Xerox, a company with whom the Respondent had substantial dealings;



• further meetings with Mr Liapis were held on 1 and 2 June 2015; and



• at the 2 June 2015 meeting Mr Liapis was advised that attending the meeting with Essential Imaging without disclosing his connection with it represented a serious conflict of interest and that he must have been aware that arranging the meetings with Essential Imaging was inappropriate, the conflict of interest was sufficiently serious to justify his dismissal, and as this was the third occasion on which he had breached the Respondent’s Code of Conduct within a period of two years that he would be dismissed as the Respondent no longer had the requisite trust and confidence in him.

[17] Mr Angley also set out in his witness statement the background to the first two warnings issued to Mr Liapis.

[18] Key aspects of Mr Angley’s oral evidence were that:

• with regard to the incident which lead to Mr Liapis receiving his first warning, based on Mr Liapis’ attitude to the warning, he was concerned that it was not second nature for Mr Liapis to understand the Respondent’s Code of Conduct;



• it was for this reason that he asked Mr Liapis to prepare a presentation on the Code of Conduct with the objective of having Mr Liapis and staff understand the Code;



• there were two elements to the Essential Imaging proposal, one of which related to the Respondent’s graphics department, with the Respondent expecting Mr Liapis to take a leadership role regarding that aspect of the project;



• while he did not know for sure, he thought that Mr Liapis may also have been involved in introducing Essential Imaging to the Respondent;



• he considered Mr Liapis sitting in on the meetings with Essential Imaging, while everyone there thought he was representing the Respondent, was sufficient to justify Mr Liapis’ dismissal;



• Mr Liapis was not just attending the meetings with Essential Imaging but was participating in the meetings;



• disputed that as at 28 May 2015 he had predetermined to dismiss Mr Liapis, though he acknowledged that when Mr Liapis contacted him on Thursday evening on his way home he did say that “it doesn’t look good”;



• agreed that up until 2012 Mr Liapis had a spotless employment record;



• at the time of the first incident, he did not further investigate whether other employees were accepting supplier largesse;



• there was nothing in the material provided by Mr Liapis that compounded the conflict of interest;



• as part of the second warning issued to Mr Liapis, he was precluded from talking to suppliers unaccompanied; and



• while Mr Liapis did not have responsibility to sign off on the decision regarding awarding the contract, he felt that Mr Liapis was putting himself in a position to influence the decision regarding the new electronic document storage system.

[19] Mr Newman in his witness statement 6 provided copies of his notes from the Respondent’s meetings with Mr Liapis on 28 May and 1 June 2015 and his discussion with Mr Harrison on 10 June 2015. With regard to the latter discussion, Mr Newman’s notes indicated that Mr Harrison advised him that Mr Liapis had approached him and not vice versa and that Mr Liapis had been paid for his work. Mr Newman also deposed that the decision to terminate Mr Liapis’ employment was made by Mr Angley. In his oral evidence, Mr Newman reiterated that it was Mr Angley who made the decision to dismiss Mr Liapis.

The statutory framework

[20] The Commission exercises its discretion in relation to an application for an unfair dismissal remedy pursuant to Part 3-2 of the Act. In this case there is no contest that Mr Liapis is a person who was protected from unfair dismissal pursuant to s.382 of the Act. In the context of this matter, the relevant provisions of the Act are ss. 385 and 387 which provide as follows:

“385 What is an unfair dismissal

A person has been unfairly dismissed if FWC is satisfied that:

(a) the person has been dismissed; and
(b) the dismissal was harsh, unjust or unreasonable; and
(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and
(d) the dismissal was not a case of genuine redundancy.

Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.

387 Criteria for considering harshness etc.

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, FWC must take into account:

(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct including its effect on the safety and welfare of other employees); and
(b) whether the person was notified of that reason; and
(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and
(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and
(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal; and

(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(h) any other matters that FWC considers relevant.”

[21] There is no dispute that Mr Liapis was dismissed, so s.385(a) of the Act is satisfied. Mr Liapis contended that his termination was harsh, unjust or unreasonable, so s.385(b) is relevant. The Respondent is not a small business employer, therefore s.385(c) is not relevant. The termination was not a case of redundancy, so s.385(d) does not apply. Therefore, in determining whether the Mr Liapis was unfairly dismissed, I must consider whether the dismissal was harsh, unjust or unreasonable as per s.385(b).

Was the dismissal harsh, unjust or unreasonable?

[22] In considering whether a dismissal was harsh, unjust or unreasonable, the Act requires the Commission to have regard to the criteria set out in s.387. I will now address these criteria.

(a) Whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees)

[23] In Rode v Burwood Mitsubishi 7 (Rode) a Full Bench of the then Australian Industrial Relations Commission (AIRC) canvassed the meaning of valid reason in the context of the relevant provisions of the Workplace Relations Act 1996 citing Selvachandran v Peteron Plastics Pty Ltd.8 The following is an extract from the Full Bench’s decision in Rode.

“[17] In relation to the meaning of “valid reason” the following remarks of Northrop J in Selvachandran v Peteron Plastics Pty Ltd are relevant:

“Section 170DE(1) refers to a ‘valid reason, or valid reasons’, but the Act does not give a meaning to those phrases or the adjective ‘valid’. A reference to dictionaries shows that the word ‘valid’ has a number of different meanings depending on the context in which it is used. In The Shorter Oxford Dictionary, the relevant meaning given is: ‘2. Of an argument, assertion, objection, etc; well founded and applicable, sound, defensible: Effective, having some force, pertinency, or value.’ In The Macquarie Dictionary the relevant meaning is ‘sound, just or wellfounded; a valid reason’.

In its context in s 170DE(1), the adjective ‘valid’ should be given the meaning of sound, defensible or wellfounded. A reason which is capricious, fanciful, spiteful or prejudiced could never be a valid reason for the purposes of s 170DE(1). At the same time the reason must be valid in the context of the employee’s capacity or conduct or based upon the operational requirements of the employer’s business. Further, in considering whether a reason is valid, it must be remembered that the requirement applies in the practical sphere of the relationship between an employer and an employee where each has rights and privileges and duties and obligations conferred and imposed on them. The provisions must ‘be applied in a practical, commonsense way to ensure that’ the employer and employee are each treated fairly, see what was said by Wilcox CJ in Gibson v Bosmac Pty Ltd, when considering the construction and application of a s 170DC.”

[18] While Selvachandran was decided under the former statutory scheme the above observations remain relevant in the context of s.170CG(3)(a). A valid reason is one which is sound, defensible or well founded. A reason for termination which is capricious, fanciful, spiteful or prejudiced is not a valid reason for the purpose of s.170CG(3)(a).

[19] We agree with the appellant’s submission that in order to constitute a valid reason within the meaning of s.170CG(3)(a) the reason for termination must be defensible or justifiable on an objective analysis of the relevant facts. It is not sufficient for an employer to simply show that he or she acted in the belief that the termination was for a valid reason.”

[24] Mr Liapis submitted that, contrary to the Respondent’s assertion, Essential Imaging was neither a supplier to it nor did it have a commercial relationship with the Respondent. Mr Liapis further contended that there was no material before the Commission to support a finding that the tasks he undertook for Essential Imaging were repugnant to his role with the Respondent. Mr Liapis also contended that at no stage did he attempt to hide his work with Essential Imaging and that he saw no reason to discuss it with his managers because he did not see it as a conflict. Mr Liapis relied on a number of authorities, including the decisions in Cementaid, Blyth Chemicals Ltd v Bushnell 9 (Blyth) and Adidem Pty Ltd T/A The Body Shop v Nicole Suckling10 (Adidem), adding that there was no breach of his implied duties and that therefore his conduct in working for Essential Imaging could not constitute a valid reason for his dismissal.

[25] The Respondent submitted that it chose to terminate Mr Liapis’ employment as a result of his conduct in relation to a meeting with Essential Imaging which the Respondent considered to have involved Mr Liapis in a serious conflict of interest. In support of that contention, the Respondent referred to its Code of Conduct which stated in respect of conflict of interest as follows:

“No Sealed Air employee may put his personal interests ahead of the interests of the Company. Even the appearance of a conflict can damage the reputation of an employee or the Company.”

[26] The policy goes on to describe and explain circumstances in which a conflict might arise and includes by way of example, an employee who:

“ causes the Company to engage in business transactions with relatives or friends;

• …



• has a financial interest in or a control position with a competitor, supplier or customer;



• …

Employees are expected to advance the Company’s interests whenever the opportunity to do so arises. Employees may not compete or prepare to compete with the Company while employed by the Company. Employees may not exploit for personal gain opportunities that they discover through the use of Company property, information or (their) position … except with appropriate management approval in advance.” 11

[27] The Respondent further submitted that the particular conduct to which it took exception was Mr Liapis’ conduct at a meeting with Essential Imaging which was convened for the express purpose of having it tender to supply software in relation to a project which Mr Liapis was leading for the Respondent. The Respondent added that Mr Liapis did not disclose his interest with Essential Imaging and that it and all of its representatives were totally unaware of his involvement in Essential Imaging. The Respondent submitted that it also had regard to the two written warnings previously issued to Mr Liapis in deciding to terminate his employment. Against that background, the Respondent contended that it had a clear and valid reason to terminate Mr Liapis’ employment.

[28] In Blyth Dixon and McTiernan JJ said:

“Conduct which in respect of important matters is incompatible with the fulfilment of an employee’s duty, or involves an opposition, or conflict between his interest and his duty to his employer, or impedes the faithful performance of his obligations, or is destructive of the necessary confidence between the employer and employee, is a ground of dismissal (Boston Deep Sea Fishing and Ice Co. v. Ansell; English and Australian Copper Co. v. Johnson; Shepherd v. Felt and Textiles of Australia Ltd.). But the conduct of the employee must itself involve the incompatibility, conflict, or impediment, or be destructive of confidence. An actual repugnance between his acts and his relationship must be found. It is not enough that ground for uneasiness as to its future conduct arises.” 12 (Citations omitted, underlining added)

[29] In Cementaid Spender AJ said:

“The touchstone for determination of cases such as the present one is to be found in the passage I have quoted from the judgment of Dixon J (as he then was) and McTiernan  J in Blyth. It may be put in questions: 1. Is the second activity incompatible with the fulfilment of the employee’s duty to his other employer? 2. Does it involve an opposition or conflict between his interest and his duty to his employer? 3. Does it impede the faithful performance of his obligations to his other employer? 4. Is it destructive of the necessary confidence between the employer and employee? In all cases an actual repugnance between the employee’s acts and his relationship with his employer must be found.” (Underlining added)

[30] Mr Angley’s evidence was that as this was the third occasion on which Mr Liapis had breached the Respondent’s Code of Conduct within a two year period it no longer had the requisite trust and confidence in him. Mr Angley’s evidence was also that with regard to the incident which lead to Mr Liapis receiving his first warning, based on Mr Liapis’ attitude to the warning, he was concerned that it was not second nature for Mr Liapis to understand the Respondent’s Code of Conduct. On the other hand, Mr Liapis’ submitted, among other things, that as the Respondent had not suffered any detriment as a result of his failure to disclose his involvement with Essential Imaging and given the nature of tasks which he performed for Essential Imaging his conduct did not warrant dismissal. While it is clear from the material before the Commission that Mr Liapis was not the decision maker regarding the successful tenderer for the electronic document storage system, it is also clear that Mr Liapis would have contributed to the Respondent’s consideration of the various proposals before it. As such, in circumstances where Mr Liapis failed to disclose his involvement with Essential Imaging, the Respondent understandably had significant and legitimate doubts as to whose interests Mr Liapis was serving. Mr Liapis’ failure to disclose that involvement, when considered with the two warnings previous issued to him, was in my view and drawing on the language in Blyth and Cementaid destructive of the necessary confidence between the employer and employee.

[31] I note also that Mr Liapis’ terms of employment, which were revised in the light of the second warning issued to him, provide as follows in respect of conflict of interest:

“At any time during your employment, you will not engage in activities that involve or could appear to involve, a conflict or potential conflict between your personal interests and the interests of Sealed Air. If such a situation arises or may reasonably be expected to arise, you undertake to notify Sealed Air in writing immediately once you become aware of that situation.” 13

[32] While not contended by either party, it appears that Mr Liapis’ failure to disclose his involvement with Essential Imaging is inconsistent with his terms of employment.

[33] Finally, as noted above, Mr Liapis also relied on the decision Adidem. However, the circumstances in Adidem are very different to those in this case. The conflict in Adidem arose because the applicant in that case was assessed by the respondent in that case as working for a direct competitor, whereas in this case the Respondent had lost trust and confidence in Mr Liapis.

[34] The above analysis supports a finding that there was a valid reason for Mr Liapis’ dismissal. Further, drawing on the language in Rode, I am satisfied that Mr Liapis’ termination was not “capricious, fanciful, spiteful or prejudiced.”

(b) Whether the person was notified of that reason

[35] Mr Liapis submitted that while he was advised that he had been dismissed for a conflict of interest, he was not provided with any particulars of the conflict of interest.

[36] The Respondent submitted that Mr Angley, on his return from leave, took the first opportunity to discuss the conflict of interest issue with Mr Liapis and that they had two meetings in which Mr Liapis was made well aware of the Respondent’s concerns regarding his behaviour.

[37] The notes of the meeting of 28 May 2015 attached to Mr Newman’s witness statement stated, among other things, that Mr Liapis agreed at the meeting that “he could understand that Sealed Air would be concerned” by the non-disclosure of his interest in Essential Imaging and that “he did use the Cell phone that was provided and paid for by Sealed Air for his role with Essential Imaging” 14. Further, Mr Newman’s notes of the meeting of 1 June 2015 indicate that Mr Angley stated:

“We have considered what you have said to us. You have provided us with your professional history with Sealed Air, you have described some professional and personal setbacks, and some successes. You would not have had the opportunities you have described if the company did not value you.

But I can’t allow you to continue to work here after 3 breaches of the Code of Conduct that you have admitted to. No business would accept this behaviour of conflict of interest.” 15

[38] Against that background, I am satisfied that Mr Liapis was notified of the reason for the termination of his employment. This weighs against a finding that his dismissal was harsh, unjust or unreasonable.

(c) Whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person

[39] Mr Liapis contended that he was given the opportunity to respond to the reason for his dismissal but that the Respondent did not give due consideration to his response.

[40] The Respondent contended that Mr Liapis took part in two meetings with Messrs Angley and Newman where he was given and took the opportunity to explain the circumstances in which he came to be at the meeting with Essential Imaging and to respond to the Respondent’s allegations that his attendance represented a clear conflict of interest.

[41] In circumstances where it is not disputed that Mr Liapis was given the opportunity to respond to the reason for his dismissal, I consider this factor weighs against a finding that his dismissal was harsh, unjust or unreasonable.

(d) Any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal

[42] Mr Liapis submitted that he was offered a support person, with that person being his supervisor, Mr Colliver.

[43] The Respondent submitted that it did not unreasonably refuse Mr Liapis the opportunity to have a support person. While the Respondent acknowledged that Mr Colliver did not originally attend the meeting of 28 May 2015 in that capacity, it submitted that he was accepted as such in the first instance by Mr Liapis. The Respondent further submitted that having had every opportunity to find an alternative support person Mr Liapis also attended the second disciplinary meeting with Mr Colliver as his support person.

[44] Accordingly, I consider this factor to be a neutral consideration.

(e) If the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal

[45] It was not disputed that Mr Liapis had been dismissed as a result of his conduct rather than his performance. Accordingly, this factor is not a relevant consideration.

(f) The degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal

(g) The degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal

[46] Mr Liapis in his written submissions contended that these factors were not relevant considerations. However, at the hearing Mr Liapis submitted that the size of the Respondent was a relevant consideration.

[47] The Respondent submitted that it is a substantial business with a dedicated Human Resources department. Further, the Respondent did not claim that the absence of any expertise had impacted on its ability to deal with the matter.

[48] Based on the material before the Commission, I do not consider that either of these factors impacted on the procedures involved in Mr Liapis’ dismissal. For instance, Mr Newman, the Respondent’s Human Resources Operations Director – ANZ, attended the meetings which Mr Angley had with Mr Liapis.

[49] Accordingly, I consider these factors to be neutral considerations.

(h) Any other matters that FWC considers relevant

[50] Mr Liapis submitted that his 25 years of service with the Respondent could, by all reasonable standards, be described as exemplary, contending that the Respondent had not acted reasonably given the circumstances.

[51] The Respondent, while conceding Mr Liapis’ 25 years’ service, disputed that it had been exemplary and meritorious having regard to the three increasingly serious issues which arose during the last three years of his employment. Further, while the Respondent accepted that credit could and should be given to longevity, it submitted that long service of itself should not be seen to excuse continuing and serious errors of judgement and/or misconduct on the part of an employee. The Respondent also contended that Mr Liapis’ indiscretions, and particularly his final indiscretion, were sufficiently serious to justify his dismissal notwithstanding his length of service.

[52] Neither Mr Liapis’ period of service nor his two prior warnings can be ignored. I therefore consider that they are both relevant matters.

Conclusion

[53] Drawing on the above analysis, I find that there was a valid reason for Mr Liapis’ dismissal, that Mr Liapis was notified of that reason and given an opportunity to respond to that reason, and that his length of service and two prior warnings are relevant matters. Beyond that, I find that Mr Liapis’ performance is not a relevant consideration and that the remaining criteria in s.387 of the Act are neutral considerations in this case. While Mr Liapis had an exemplary employment record for the overwhelming period of his employment with the Respondent, the past three years have been marred by a number of incidents which have undone Mr Liapis’ efforts in the preceding 22 years. In my view, Mr Liapis still does not comprehend the Respondent’s concerns regarding the conflict which arose as a result of his participation in the meetings with Essential Imaging without him disclosing his involvement with it to the Respondent. As previously noted, Mr Liapis’ failure to disclose his involvement with Essential Imaging was destructive of the necessary confidence between the employer and employee, particularly when his two prior warnings are taken into account. In other words, Mr Liapis’ length of service does not undermine or outweigh the validity of the reason for his dismissal.

[54] Having considered all of the criteria in s.387 of the Act I find that Mr Liapis’ dismissal was not harsh, unjust or unreasonable. Accordingly, his application is dismissed. An order to that effect will be issued in conjunction with this decision.

Appearances:

M. White of Counsel for H. Liapis.

D. Miller for Cryovac Australia Pty Ltd T/A Sealed Air.

Hearing details:

2015.

Melbourne:

September 8.

 1   Exhibit W1

 2   (1995) (unreported, Supreme Court, NSW, Spender J, 29 March 1995)

 3   Exhibit M1

 4   Exhibit M2

 5   Exhibit M3

 6   Exhibit M4

 7   Print R4471

 8 (1995) 62 IR 371

 9 (1933) 49 CLR 66

 10   [2014] FWCFB 3611

 11   Form F3 – Employer Response to Unfair Dismissal Application at Attachment A

 12 (1933) 49 CLR 66 at 81-82

 13   Exhibit M3 at Attachment MEA-1

 14   Exhibit M4 at Attachment CJN-2

 15   Ibid

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