Hutchinson v Dorevitch Laboratory Services Pty Ltd (Trading as Dorevitch Pathology)

[1996] IRCA 99

DECISION NO:  99/96

CATCHWORDS

INDUSTRIAL LAW - TERMINATION OF EMPLOYMENT - whether employee terminated for a VALID REASON - whether termination was HARSH, UNJUST OR UNREASONABLE - PROCEDURAL FAIRNESS

Industrial Relations Act 1988 ss 170DC, 170DE, 170EA, 170EDA

No. VI 2688R of 1994

ROBERT DOUGLAS HUTCHINSON AND HEALTH SERVICES UNION OF AUSTRALIA v DOREVITCH LABORATORY SERVICES PTY LTD (trading as DOREVITCH PATHOLOGY)

Marshall J
Melbourne
22 March 1996

IN THE INDUSTRIAL RELATIONS        )
  )
COURT OF AUSTRALIA  )
  )

VICTORIA DISTRICT REGISTRY            )  No. VI 2688R of 1994

BETWEEN:    

ROBERT DOUGLAS HUTCHINSON AND HEALTH SERVICES UNION OF AUSTRALIA

Applicants

AND:  

DOREVITCH LABORATORY SERVICES PTY LTD (trading as DOREVITCH PATHOLOGY)

Respondent

JUDGE:         Marshall J

PLACE:         Melbourne

DATE:  22 March 1996

ORDER

THE COURT ORDERS THAT:

1.        The application be dismissed.

NOTE:  Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules.

IN THE INDUSTRIAL RELATIONS        )
  )
COURT OF AUSTRALIA  )
  )

VICTORIA DISTRICT REGISTRY            )  No VI 2688R of 1994.

BETWEEN:

ROBERT DOUGLAS HUTCHINSON AND HEALTH SERVICES UNION OF AUSTRALIA

Applicants

AND:  

DOREVITCH LABORATORY SERVICES PTY LTD (trading as DOREVITCH PATHOLOGY)

Respondent

JUDGE:         Marshall J

PLACE:         Melbourne

DATE:  22 March 1996

REASONS FOR JUDGMENT

BACKGROUND

On 15 December 1994 the applicants filed in the Victoria District Registry of the Court an application pursuant to s170EA Industrial Relations Act 1988 (“the Act”). The application sought the making of orders under the Act including orders for reinstatement of the first applicant and the payment of compensation to him arising out of the termination of his employment by the respondent. On 21 December 1994 the District Registrar of the Court referred the matter for conciliation by the Australian Industrial Relations Commission (“the Commission”). On 12 January 1995 Commissioner Harrison certified that the Commission had been unable to settle the matter by conciliation. The application was heard by Judicial Registrar Parkinson on various hearing days between 12 April 1995 and 19 June 1995 inclusive.

On 1 August 1995 the Judicial Registrar delivered her reasons for decision and ordered that the application be dismissed.  On 10 August 1995 the first applicant applied by way of notice of motion for a review of the decision of the Judicial Registrar.

The review was conducted before the Court on 28 and 29 February and 1 March 1996. The first applicant represented himself.  The respondent was represented by Mr Lacy of counsel.  The second applicant did not appear on the review.  By agreement of the parties, the transcript of evidence and exhibits in the proceedings before the Judicial Registrar were treated as evidence before the Court on the review. The first applicant gave further evidence before the Court on the review and requested the respondent to make available for cross-examination three witnesses who had given evidence on behalf of the respondent before the Judicial Registrar.  The first applicant also advised the Court that he was no longer seeking reinstatement but compensation only.

RELEVANT FACTS

Prior to the termination of his employment, the first applicant was employed by the respondent at Hamilton in Western Victoria as a Medical Scientist Grade 1.  The first applicant had previously been employed at the same work location by Hamilton Base Hospital prior to its pathology services being privatised.  Upon privatisation in May 1994, the pathology laboratory at Hamilton Base Hospital came to be operated by the respondent.  The first applicant had been the head of the pathology department before the respondent became responsible for the operation of the relevant pathology services.

A series of events commencing on 6 December 1994 led to the termination of the first applicant’s employment by the respondent.  On that day the laboratory was responsible for the testing of a blood sample which had been extracted from a four year old child, with the surname “Pratt”.  The relevant process was “a full blood analysis”.  A portion of the blood sample was placed in a machine known as a Coulter machine.  The machine analysed the blood inter alia to determine whether or not it displayed any abnormal features.  Additionally a film was produced on a slide  of portions of the relevant blood for visual examination and analysis.

The Coulter machine was operated by a Mrs Edwards.  The first applicant observed the results noted by Mrs Edwards and then performed an analysis of the blood by visual examination of the slide.  The first applicant reported that the blood film in combination with the result from the Coulter machine showed that the child was suffering from a gross iron deficiency (severe anaemia).  The test results were later verified by the Laboratory Manager, Mrs Stevens in reliance upon the experience of the first applicant.  It was conceded by the first applicant that he erred in his examination of the blood film and that in observing it he was “playing the numbers” and was over-influenced by the Coulter result.  The respondent considered that the erroneous report was a serious matter.  However, it did not terminate the first applicant’s employment as a result of that error.  As written submissions filed by the respondent suggested:-

“(r)ather it was that fact combined with the applicant’s conduct in relation to the error and the consequent inquiry into its cause which is considered to warrant his dismissal.”

It should be noted at this stage that a portion of the relevant blood sample was run through the Coulter machine by Mrs Stevens on 8 December 1994 and the resulting analysis was found to be normal.

In the proceedings before Judicial Registrar Parkinson, Ms Leanne Taaffe, the principal scientist in the haematology laboratory at the Royal Children’s Hospital in Melbourne gave evidence concerning the appropriate response of a medical scientist upon obtaining an abnormal result from a Coulter analysis.  She stated that the first response would be to re-run the blood sample through the Coulter machine if a sufficient quantity of sample remained to permit such a re-testing.  Her evidence was that the results would need to be checked.

Dr Leyton, the Head of the Pathology Department of the respondent, gave evidence that she, in the company of Mrs Stevens, asked the first applicant on the evening of 7 December 1994 whether he had re-run the blood sample through the Coulter machine before issuing his report.

Dr Leyton said that the first applicant undertook to provide her with all material which was used in the compilation of his report together with any material relevant to the testing of another child’s blood on 6 December 1994.  That other child had the surname “Worthy”.  The first applicant agreed that Dr Leyton had asked for the slides and the Coulter printout in respect of the relevant test but denied before the Judicial Registrar being asked for material regarding the testing of another child patient.  However, before me he testified that he had been so asked.  He denied before the Judicial Registrar that he had been asked whether he had re-run the Coulter test with the original blood sample and stated that he had merely been asked whether he had checked the results.  He said he took this to mean whether he had checked the blood film for any evidence of blood clots.  He maintained his denial before me.

A further blood sample from the child, Pratt, was taken on 7 December 1994.  This sample was processed through the Coulter machine and was analysed as normal.  The original results from the previous day were passed on, by telephone, to the ward sister and thereon to the child’s doctor.  The doctor, on hearing of the results from the 7 December 1994 test, advised the child’s mother that the laboratory had “stuffed up”.

The first applicant concedes that he did not provide the relevant material from the 6 December 1994 test to Dr Leyton.  He said that he attempted to deliver it to her but, upon finding the door to her office locked, he left it on the top of a filing cabinet and forgot to give the material to her.  Mrs Stevens gave evidence that she requested the material for Dr Leyton again on the morning of 8 December 1994 and that the first applicant acknowledged her request.  The first applicant denied that this had occurred.  On 9 December 1994, the first applicant came to work early as a result of a call-out outside his ordinary hours to attend to some urgent work.  He had forgotten to provide the relevant material to Dr Leyton on the previous day.   He said that he overlooked the matter on 9 December 1994 when he attended on the call-out and left work early, as was his entitlement under the relevant award, after responding to the call-out.

The first applicant conceded that Dr Leyton had requested a copy of the relevant material be brought to her as soon as possible.  Having regard to the nature of that request and the first applicant’s failure to respond to it, it is not surprising that the respondent’s representatives, Dr Leyton and Mrs Stevens, suspected that the first applicant was indifferent to the investigation into what had gone wrong with the test on 6 December 1994, or alternatively, was attempting to cover-up for his error regarding the blood film.

On the issue as to whether the first applicant had been asked whether he had re-run the test or merely checked the results, there is a stark contrast between his evidence and that of Mrs Stevens and Dr Leyton.  Having closely observed the demeanour of the critical witnesses for myself on the review, and having regard to certain inconsistencies in the first applicant’s testimony as illustrated above, I have reached the same conclusion as Judicial Registrar Parkinson did; i.e. that the evidence of Mrs Stevens and Dr Leyton should be preferred to that of the first applicant where his evidence conflicts with their testimony.

The first applicant attended for work on 12 December 1994 and was interviewed by Mrs Stevens and Dr Leyton.  When viewed in context and in totality the effect of the interview was that the first applicant was advised that unless he was able to satisfactorily explain his actions in respect of the Pratt child’s blood sample he would be summarily dismissed.  A meeting was then arranged for 14 December 1994 to enable a representative of the second applicant to represent the first applicant.  During the interview, the first applicant was advised of the concerns of the respondent that he was either indifferent to the need to investigate what had occurred with the Pratt sample or was involved in a cover up.  He and his union representative were given an opportunity to respond to those concerns, which constituted the material allegations made against him.  At the conclusion of that meeting the first applicant was handed a short letter which stated that his employment had been terminated as of that day and that he would receive a cheque for all entitlements including “compensation in lieu of notice”.

Subsequently, a meeting was arranged for later that afternoon at which the Chief Executive Officer of the respondent, Mr Mak, was present.  The purpose of this meeting was to see if the matter was capable of resolution without the need for the termination of the first applicant’s employment.  To allow discussions to occur, the written letter of termination was withdrawn and the first applicant was placed on suspension with full pay.  During that interview the first applicant conceded that “he may have lied” in his version as to whether or not he had been asked to re-run the Coulter tests on the Pratt child’s sample of 6 December 1994.  To say that this disclosure inflamed the respondent’s representative is to understate the position.  A heated, hardly conciliatory, discussion then occurred.  The respondent’s representatives took the unexceptional view that the laboratory could not operate effectively if there was a lack of trust by management in its professional staff.

At the conclusion of the second meeting on 14 December 1994 the applicant was effectively told that his employment would be terminated if the principals of the respondent would not agree to his transfer to the respondent’s laboratory at Camberwell in suburban Melbourne.  As the first applicant testified before me:-

“the issue in (Mr Mak’s) eyes was an issue of trust and that it was felt that as I had lied to the pathologist I could no longer be trusted in an unsupervised role to perform my duties at Hamilton.”

On returning to Melbourne Mr Mak received a negative response from the principals of the respondent to the mooted transfer to Camberwell. On 15 December 1994, Mr Mak wrote to the first applicant advising him that his employment was terminated as at the end of that day.

I accept the first applicant’s evidence that he did not believe he was conceding that he had in fact lied.  I believe that he was actually trying to avoid calling Dr Leyton and Mrs Stevens liars in the last interview.  It must be remembered he was also trying to save his job.  However, a prudent employer in the position of the respondent would justifiably form an adverse conclusion about anyone in a position of trust who would contemplate making a concession that he may have lied.

SECTION 170 DE(1) - VALID REASON

Having regard to the matters set out above, I am of the view that the respondent has discharged the onus under s170EDA of the Act of demonstrating that it had valid reasons to terminate the employment of the first applicant and that such valid reasons were connected with the first applicant’s capacity or conduct and were based on the operational requirements of the respondent’s undertaking.

The respondent was entitled to take the view, in my opinion, that the first applicant was indifferent to the request made by it to urgently provide material to Dr Leyton to allow her to investigate the Pratt blood sample of 6 December 1994.  Additionally, the respondent was entitled to take the view after the second meeting of 14 December 1994, that it was not able to fully trust the first applicant to work without supervision.

SECTION 170DE(2) - HARSH, UNJUST OR UNREASONABLE

Notwithstanding the Court’s finding that the respondent had valid reasons for its termination of the employment of the first applicant, it was open to the first applicant to attempt to prove that his termination was nonetheless harsh, unjust or unreasonable. See s170EDA(1)(b) of the Act.

The first applicant submitted that his termination was harsh, unjust or unreasonable because of the failure of the respondent to adequately investigate the matters raised against him. In particular, he claimed that it was critical that he had not been informed at any stage in his meetings with the respondent’s representatives that the original Pratt blood sample had been re-run by Mrs Stevens and had produced a normal result. It is difficult to see how a revelation of that fact would have assisted the first applicant on the issues of his indifference to the investigation of what had occurred on 6 December 1994 or on the question of the respondent’s lack of trust in him. Insofar as s170DE(2) of the Act requires that a termination be procedurally as well as substantively fair, I am of the view that procedural fairness was accorded to the first applicant regarding the matters which led the respondent to terminate his employment.

SECTION 170DC

The first applicant alleged that s170DC of the Act had been breached by the respondent essentially for the same reasons he had alleged that it was in breach of s170DE(2) of the Act. I do not believe that s170DC of the Act was breached by the respondent. At the meeting of 12 December 1994 and the first meeting of 14 December 1994, the first applicant had heard in clear terms what the material allegations made against him were. The focus was on the allegation of a lack of adequate response to the relevant investigation and/or indifference to it or a cover up of his failings. These matters were again canvassed in the second meeting of 14 December 1994, as well as the issue of his trustworthiness which arose during that meeting as a result of comments made by him.

In such circumstances it is wrong to suggest that the first applicant was not given the opportunity to defend himself against the allegations made by the respondent.

CONCLUSION

Having regard to my findings that no breach of s170DE or s170DC of the Act occurred the application must be dismissed.

I certify that this and the preceding 10 pages are a true copy of the Reasons for Judgment herein of his Honour Justice Marshall.

Associate:  

Date:  22 March 1996

The Applicant appeared in person                 

Counsel for the Respondent:  B. Lacy

Solicitor for the Respondent:  Minter Ellison

Dates of hearings:  28, 29 February and 1 March 1996

Date of judgment:  22 March 1996