James Monaghan v Greyhound Racing Control Board T/A Greyhound Racing Victoria - [2018] FWC 4933

[2018] FWC 4933

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009

s.394—Unfair dismissal

James Monaghan

Greyhound Racing Control Board T/A Greyhound Racing Victoria

(U2018/3477)

Commissioner Gregory

MELBOURNE, 22 AUGUST 2018

Application for relief from unfair dismissal – valid reason – termination ‘harsh’ –remedy – compensation awarded.

Introduction

Mr James Monaghan was employed as a Senior Steward by the Greyhound Racing Control Board T/A Greyhound Racing Victoria (“GRV”) in 2016. He had previously had a long career in law enforcement and investigations, including 17 years with the Victoria Police. However, he was dismissed from his employment in March of this year for having acted in breach of GRV’s gambling policy.

Mr Monaghan claims he did not knowingly act in breach of the policy and now claims he was unfairly dismissed. This decision deals with that application.

Mr A. White of Counsel appeared on behalf of Mr Monaghan. Ms R. Frenzel appeared on behalf of GRV. Both were given permission to appear under ss 596(2)(a) and (c) of the Fair Work Act 2009 (Cth) (“the Act”) as the matter clearly involves a degree of complexity, and it would be unfair not to allow them to appear taking into account fairness between the parties.

The Issue to be Determined

Section 385 of the Act provides that a person has been unfairly dismissed if the Commission is satisfied “the dismissal was harsh, unjust or unreasonable.”[1]

Section 387 continues to require that the Commission must take into account the following considerations in determining whether the dismissal was harsh, unjust or unreasonable. It states:

“387      Criteria for considering harshness etc.
In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the 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 the FWC considers relevant.”[2]

The Commission is now required to determine whether Mr Monaghan’s dismissal was “harsh, unjust or unreasonable” taking into account the various matters in s.387.

The Evidence and Submissions

The Applicant’s Submissions and Evidence

Mr James Monaghan

Mr Monaghan has had a long career in law enforcement and investigations. He commenced with Victoria Police in 1975 and worked there for almost 17 years. He attained the rank of Detective Sergeant and was awarded the National Police Medal for Honourable and Distinguished Service. His work as a Detective included four years in the Criminal Investigation Branch Racing Squad. He has also worked in other roles, including ten years as an integrity investigator for Racing Victoria, and immediately prior to commencing work at GRV he worked for 12 months as a Senior Investigator at Greyhound Racing New South Wales. He states that he has had “an unblemished work record”[3] during all of this time and has never received a warning about any work-related disciplinary matter.

Mr Monaghan was first employed by GRV as a Steward in August 2016. Prior to commencing he completed various pre-employment declarations including a declaration of his betting accounts.[4] In that declaration he acknowledged that he understood GRV’s policy in relation to gambling and greyhound racing. He also provided relevant account identification numbers to enable GRV to periodically conduct audits of his betting accounts.

He stated that, “It was my understanding at the time of commencing employment with GRV that it was against GRV policy to bet on a greyhound race.”[5]

In March last year he applied for the position of Senior Steward and was offered that position in April. He also received a bonus payment in November last year following a performance review.

On 1 March this year he received an email from Mr Shane Gillard, who is the General Manager Integrity at GRV. It attached a letter from Ms Donna King, the General Manager People and Culture at GRV, which referred to an irregularity identified in one of his betting accounts, and indicated that a meeting had been organised to discuss this matter.[6]

The meeting with Mr Gillard and Ms King took place on 7 March. Mr Gillard said an audit of his betting accounts showed Mr Monaghan had placed a bet on a greyhound race on 31 January 2017. He was shown a spreadsheet which set out the bets made through his Betfair account, and the bet in question was said to have been made at 10.17 p.m. on 31 January 2017 on a greyhound race in Nottingham, in the United Kingdom.[7]

Mr Monaghan indicated in response that he could not believe he had put a bet on a greyhound race, and had never knowingly bet on a greyhound race while employed by GRV, and he had not sought to act in breach of GRV’s gambling policy. However, he also said that he might have put a bet on the race without realising it was a greyhound race.[8]

There was then a break in the meeting and, when it resumed, Mr Gillard indicated that a breach of the policy would normally result in termination. He also told Mr Monaghan that he would be given an opportunity to show cause why he should not be terminated. Mr Monaghan was also told that he was to be stood down on full pay, effective immediately. He was provided with a letter at the conclusion of the meeting, which set out the allegations and requested that he show cause why his employment should not be terminated.[9] A further meeting was also scheduled.

Mr Monaghan also stated that he had been given the opportunity to have a support person present at the meeting but did not take up this opportunity because at the time he did not understand the nature of the allegations made against him, and did not consider it necessary.

Following the meeting Mr Monaghan “attempted to reconstruct the events of the evening of 31 January 2017”[10] because he had “no independent recollection of the evening.”[11] The spreadsheet indicated that the bet was one of 13 he made between 10 p.m. and midnight on the evening of 31 January 2017. The other 12 bets were placed on horse races in Australia, South Africa and France.

He was in the habit of betting in the evening on occasions on overseas thoroughbred races. In general, he did not follow the races on television or radio but would simply follow the progress of the race and the subsequent results on the Betfair website. He generally knew little or nothing about the horses he was betting on, and his bets were typically based on betting fluctuations or the name or number of the horse.

Mr Monaghan continued to state that prior to commencing work at GRV he rarely bet on greyhound racing and since being employed by GRV had “… never knowingly bet on a greyhound race.”[12]

He indicated that the Betfair website has links along the side of the page to the next races and, “I believe that I would have accidentally clicked to select next greyhound race instead next thoroughbred race. I believe I would have then bet on the greyhound race without realising that it was not a thoroughbred race.”[13] He was also well aware that an irregular bet would not go undiscovered, and he “would not throw away my reputation and a job that I enjoyed over a single greyhound race.”[14]

Mr Monaghan attended the second meeting with Mr Gillard and Ms King on 26 March together with a representative from the Australian Workers’ Union, Mr Steve Bonica. He provided a statement at the meeting indicating he had not knowingly made the bet. He accepted that the betting account was his and no one else had used his account. He also considered the approach of Mr Gillard and Ms King to have been unnecessarily adversarial.

He had not been watching or listening to the races at the time he made the bet and therefore did not know he was betting on a greyhound race. In addition, he has since closed all of his online betting accounts to avoid a similar mistake happening again.

He also asked whether there were any other matters under consideration and was told there was not. Mr Bonica also spoke on his behalf and emphasised that there was no intent on Mr Monaghan’s part to place a bet on a greyhound race. The meeting then broke for a period of around 15 minutes.

When it reconvened, Mr Gillard told Mr Monaghan his employment was terminated, effective immediately, as GRV had a zero tolerance policy in regard to Stewards betting on greyhound races. Mr Monaghan said both Mr Gillard and Ms King showed little interest in how the bet could have been placed, and he was left with the impression at the conclusion of the meeting that nothing he could have said or done would have made any difference to their decision.[15] He was then provided with a termination letter.[16] It referred to him having breached the Victorian Public Sector Code of Conduct, but this was the first time he was aware of any allegation about a breach of the Code, as it had not been raised in either of the meetings.

Mr Monaghan said his reputation is everything and he seeks to be reinstated so that he can have the opportunity to return to work and rebuild his reputation with his colleagues. As a consequence he does not consider that monetary compensation would be an adequate remedy. He does not believe it would be impractical for him to be reinstated as he maintains good relationships with many of his former colleagues. He also does not believe his working relationship with the employees at GRV he is regularly involved with has been damaged by what has occurred.

Since being terminated he has returned to work as an independent private investigations contractor and has endeavoured to mitigate his loss. However, he is now earning significantly less than when he was employed by GRV.

Mr Monaghan’s Submissions

Mr Monaghan submits at the outset that there was not a valid reason for his dismissal. In his submission, it is not a breach of GRV’s Gambling Policy to place a bet on a greyhound race in the United Kingdom. Firstly, the policy is silent in relation to greyhound racing events which occur outside of Australia. Secondly, there is no good reason why the policy should be construed as to extend to a ban on gambling on greyhound racing events in which GRV employees have no influence.

His submissions continue to set out the following relevant extracts from the policy:

“Greyhound Racing Events
You must not at any time (whether or not during working hours) directly or indirectly participate in:
· Gambling on any greyhound racing event;
…”[17]

“Greyhound Racing Event” is defined in the policy as follows:

“Greyhound Racing Event
For the purposes of this policy, a greyhound racing event means the competitive pursuit by one or more greyhounds of a lure and includes a series, qualifying trial or in the case of a coursing meeting a “course.”[18]

It is also noted that the purpose of the policy is stated to be:

“The purpose of this policy is to:
· Set out employees obligations in relation to gambling;
· protect the integrity and reputation of Greyhound Racing Victoria (GRV) and the Victorian Greyhound Racing Industry through appropriate behaviour and to demonstrate adherence to the public sector values including “Integrity” and “Impartiality.”[19]

Mr Monaghan continues to submit that there is a clear and logical connection between the policy of banning gambling on greyhound racing in Victoria where an employee of GRV might have the capacity to influence the outcome of an event. However, that “logical connection all but vanishes in relation to a greyhound racing event conducted outside of Australia.”[20] The policy should therefore be interpreted to exclude an event which occurs outside of Australia. In summary, the purpose of the policy is not served by broadly defining “greyhound racing event” to include an international race.

It was also indicated in response to a question from the Commission that Mr Monaghan’s principal position is that he did not breach the policy because the race was not conducted in Victoria. However, his position in the alternative is that if he has breached the policy then GRV’s response was disproportionate.[21]

He next submits that if it is found that the policy extends to include an event which occurs outside of Australia then the Commission should find that the policy is not a reasonable one because of the lack of “logical connection to the stated purpose of the policy.”[22] He relies in this context on the decision in Potter v WorkCover Corporation (‘Potter’)[23] where a Full Bench of the Australian Industrial Relations Commission concluded that breaching an employer’s policy will not of itself automatically give rise to a valid reason for termination. The policy must also be lawful and reasonable.

He submits that in the present matter the purpose of the policy is to protect the integrity of the greyhound racing industry in Victoria. There is no evident threat to the integrity of the industry in Victoria when a bet is placed in a jurisdiction outside of the control or influence of its employees. The lack of a logical connection between the policy and the purpose of the policy should therefore be found to be unreasonable. He continues to submit that GRV has not sought to explain how betting on an international greyhound event can have any actual effect on the integrity of GRV.[24] In addition, when it is considered that the circumstances involved a single bet placed inadvertently on a race in the United Kingdom then GRV’s concerns about the impact on the industry are misplaced.

There is also nothing in the evidence to support GRV’s view that its reputation might be damaged by him betting on an international greyhound race. The opinions of Mr Gillard and Ms Lester in this context are only speculative opinion evidence and have no special foundation or necessary basis in fact.[25]

It is next submitted that Mr Monaghan was given no real opportunity to respond to the reasons for his dismissal, and to treat a breach of policy with zero tolerance is to effectively deny an employee the opportunity to respond to the case against them. He submits, in particular, that GRV “predetermined and prejudged his circumstances and the punishment that they would give to him.”[26] In summary, he was given “… no real opportunity to change the mind of the decision makers about what the result would be.”[27] He also relies in this case on the decision in Wadey v YMCA Canberra (‘Wadey’)[28] where it was found that the opportunity to respond requires more than simply “going through the motions.”[29] It instead requires that the employer might decide not to terminate if the reasons in response are of substance.

In addition, in the present matter the policy was not expressed as being one involving zero tolerance, and it could not be expected that it would be applied in this way when a breach is established. This is emphasised when regard is had to the compliance obligations which state:

“Compliance
A breach of your obligations under this policy will be considered serious misconduct and may result in disciplinary action including termination of employment.”[30]

It is submitted in response that the policy clearly reserves a discretion in regard to whether disciplinary action should be taken where an employee is found to be in breach of the policy. Therefore, Mr Monaghan was entitled to be heard in regard to both whether he breached the policy and what, if any, action should be taken in relation to any breach. However, the zero tolerance approach denied him a real opportunity to respond.

He next submits that his dismissal was harsh because it was disproportionate to the gravity of the conduct. He relies on the decisions in Byrne & Frew v Australian Airlines Ltd[31] and Bostick (Australia) Pty Ltd v Gorgevski (No 1) (‘Bostick’)[32] in support. He also refers to the decision of Commissioner Hodder in Atfield v Jupiters Ltd (‘Atfield’),[33] where an employee of the casino placed a bet at a TAB inside the casino in breach of its gambling policy. When the employee was told by an attendant at the TAB that it was a breach of the policy, the employee immediately cancelled the bet. Mr Monaghan continues to submit that, in the present case, the breach was an inadvertent one, and given he was unaware of any breach he was unable to do anything to remedy it or respond to what he had done. For example, he was in no position to come forward and acknowledge what he had done because he did not realise what he had done. The bet was placed unintentionally; it was a single isolated bet on a greyhound event; it was placed in a foreign jurisdiction, and it involved a relatively small amount of money. Mr Monaghan submits, in summary, that when taking into account all of these circumstances the decision to dismiss him was disproportionate to the gravity of the alleged misconduct.[34]

Mr Monaghan continues to submit that he seeks reinstatement because he wants the opportunity to rebuild his reputation, which in his view has been tarnished by what has occurred.[35] He considers that compensation would be an inadequate remedy, and relies in this context on the decision in Perkins v Grace Worldwide (Aust) Pty Ltd[36] where a Full Court of the Industrial Relations Court consider the practicality of reinstatement.

He also refers to the decision in Farquharson v Queensland Racing Integrity Commission (‘Farquharson’) [37] where the Queensland Industrial Relations Commission allowed an application for reinstatement by a harness racing Steward. That matter involved allegations of dishonesty and a close working relationship between the Steward and management. In the present matter Mr Monaghan was based primarily in regional Victoria and had little contact with GRV Head Office. This provides further support for reinstatement being a practical remedy. There is also no suggestion in this case of poor performance and, apart from the single matter that led to his dismissal, Mr Monaghan has had an exemplary work and disciplinary record.

The Respondent’s Submissions and Evidence

Ms Donna King

Ms Donna King is the General Manager People and Culture at GRV and has been in that position since May 2013. Her role was created as an outcome from an investigation carried out by the Victorian Ombudsman in 2012 into various issues at GRV, including gambling on greyhound racing by its employees.

In the time she has been employed “a complete end to end process in relation to compliance has been introduced and is continually reviewed and improved, this process applies to all GRV employees.”[38]

Mr Monaghan commenced with GRV in the middle of the 2016 and was advised at the time about GRV’s gambling policies. He was also required to read and understand and complete its gambling and ownership declarations. This involves reading and agreeing to the ownership and gambling policies, as well as declaring any betting accounts.

In January 2018 the Manager Risk, Compliance and Internal Audit at GRV requested information from betting operators about betting activity for all employees at GRV during the course of 2017. This is done each year as a matter of course. The information obtained indicated that Mr Monaghan may have gambled on a greyhound race during this time.

Sub clause 19.2 of the Greyhound Racing Victoria Stewards and Associated employees Enterprise Agreement 2016 provides for summary dismissal for any employee who engages in betting on any greyhound race. It does not distinguish by reference to the location of the race and Ms King states in her evidence that, “It is widely accepted that the clause covers any greyhound race.”[39]

Ms King continued to indicate that Mr Monaghan “was given real opportunities to respond to allegations put to him as follows.”[40] She refers in this context to the email sent to him by Mr Gillard on 28 February requesting he attended a meeting in the following week. A letter attached to the email made reference to an irregularity identified in a betting account held in his name. The meeting with Mr Monaghan then took place on 7 March and he was allowed to record the meeting. There was then a second meeting on 26 March, which Mr Monaghan attended with an official from the AWU. He was told at this meeting that GRV had a zero tolerance approach to greyhound betting. It was also concerned to establish who had placed the bet because in another unrelated matter a Steward had been accused of placing a bet on a greyhound race, when it was actually the Steward’s domestic partner who had placed the bet using the Steward’s betting account.

Ms King also emphasised that some of Mr Monaghan’s responses in the meeting such as, “I can’t recollect,”[41] or “I don’t want to go into my personal life,”[42] do not support his assertion that he was of the view that nothing he said was going to make any difference to the decision that was to be made about him.

Ms King also acknowledged that the breach of the Victorian Public Sector Code of Conduct was not raised with Mr Monaghan during the investigation process, however, he would have been aware of his obligation to comply with the Code as it was referred to in his induction. However, the basis of his termination was essentially due to his breach of GRV’s gambling policy.

Ms Heidi Lester

Heidi Lester is the Chief Steward with GRV and has been in this position since October 2016. She is responsible for the Stewards’ Panel and the proper conduct of all greyhound racing meetings in Victoria.

Her evidence detailed the powers Stewards can exercise and the requirement to “… conduct themselves in a manner that is beyond reproach at all times.”[43] In her view when a Steward bets on a greyhound race “… it strikes at the heart of the integrity of not only the individual, but the entire Stewards’ Panel and the broader Organisation that employs that person.”[44] She continued to state that betting on greyhound races by Stewards will never be tolerated.

She also considers that it would be “inconceivable”[45] for a Steward to remain on the Panel after being found to have bet on a greyhound race, and it would send a sign more generally that GRV is not capable of enforcing its own integrity policies.

Mr Shane Gillard

Mr Gillard is the General Manager of Integrity at GRV and has been in this role since August 2016. He was employed with a clear mandate to design and implement a credible Integrity Department within GRV in circumstances where the organisation had previously been confronted with a number of integrity and proper conduct issues. He was also tasked with implementing the recommendations from the Victorian Racing Integrity Commissioner’s Report entitled “2015 Own Motion Enquiry into Live Baiting in Greyhound Racing in Victoria.”[46] This included a review of the management of conflicts of interest by participants in the industry.

Mr Gillard said that greyhound racing is a relatively limited activity in international terms, and is primarily confined to events held in Australia, New Zealand and the United Kingdom. There is also a significant degree of mixing and interaction between those involved in the industry given its limited size and scope.

GRV has an agreement with wagering operators about the disclosure of information relating to bets placed on a greyhound racing. This includes betting accounts and the wagering activity of GRV employees, and each year GRV requests information from those operators about the betting activity of all GRV employees.

Mr Monaghan was one of four employees at GRV who were found to have irregularities in their betting activities in 2017 as a consequence of the information obtained through this process. One of those employees subsequently resigned and the other three have been terminated.

Mr Monaghan responded to the letter sent on 28 February 2018[47] in an email on 1 March 2018 indicating he did not believe he had not breached the gambling policy and requesting further details.[48] He also asked that he be given the opportunity to resign if termination of his employment was being considered. Mr Gillard indicated in response that the purpose of the meeting on 7 March was to table what had been discovered during the audit, and all relevant details would be available at the meeting. He also indicated that no decision had been made at that point about his employment status.

In the meeting on 7 March, Mr Monaghan did not provide any insight into how the bet came to have been placed, other that he had no recollection of placing the bet. He also confirmed he was the only person that accessed the relevant account. However, he did indicate that he often relaxes with a few drinks and places some bets using his laptop as a means of unwinding after work. He was also given the opportunity to provide a formal response to the allegations, but responded by indicating that it wouldn’t change anything, and he understood GRV could not have Stewards betting on greyhound races. He also mentioned that he was aware the matter was serious, and gambling on greyhound races would likely result in instant dismissal.

Mr Monaghan also reiterated in the meeting on 26 March that he had no recollection of placing the bet and was unaware at the time that he was betting on a greyhound race.

Mr Gillard considers that the Betfair webpage “…makes it clear about the type of bet you are placing online, it has an icon of a horse or dog next to the ‘quick link’ for ‘next to jump’ and also differentiates, in writing, whether the bet is on ‘Racing or ‘Greys’. There is also a confirmatory step that requires further approval of the bet before it becomes a ‘live’ bet.”[49]

Mr Gillard said he had an open mind throughout the entire process, including in the meeting on 26 March but, when questioned, Mr Monaghan provided nothing by way of explanation other than to reiterate that he could not recall placing the bet, and could not recall anything of the evening in question.

Mr Gillard was also of the view that if GRV was required to reinstate Mr Monaghan as a Steward it would destroy public confidence in terms of the credibility and professionalism of GRV. It also had the potential to cause “a loss of confidence in the Greyhound racing product.”[50] In his view reinstatement was therefore not a viable option.

GRV’s Submissions

GRV is a Statutory Authority of the Victorian Government and is required to ensure the Victorian Public Sector Code of Conduct is upheld by its employees. Mr Monaghan’s employment was also covered by the terms of the Greyhound Racing Victoria Stewards and Associated employees’ Enterprise Agreement 2016, which has direct reference to the prohibition of betting on greyhound races by Stewards. The GRV Employee Enterprise Agreement 2016[51] given to Mr Monaghan contains the same prohibition, and both Agreements provide that employees betting on greyhound races may be summarily dismissed.

GRV’s submissions also make reference to a number of reviews and investigations which have been conducted during the past decade into the greyhound racing industry, and the adverse publicity that has attached to issues involving the industry. This included the Victorian Ombudsman’s report which “was absolutely damning of GRV,”[52] and led to a number of staff being terminated. Eight of those employees were in integrity positions, including as Stewards, and some were found to have bet on races at which they officiated, or had otherwise been involved in. There was, therefore, a heightened awareness of the issues associated with gambling by Stewards and, as a consequence, the industry and GRV now has a priority and focus on integrity issues and this applies across the board to all GRV employees.

It continues to submit that Mr Monaghan was dismissed for breaching GRV’s gambling policy as a consequence of having placed a bet on a greyhound race. The location of the race is irrelevant and Mr Monaghan does not dispute that he bet on a greyhound race. In addition, the fact he claims to have no independent recollection of what occurred on the evening in question does not assist him. He was aware of his obligation to ensure that he does not bet on greyhound racing, and it is no answer to assert that he has no independent recollection of that occurring. He simply failed to exercise due diligence to ensure he did not bet on a greyhound race, and the fact he placed the bet constitutes a valid reason for the termination of his employment.

It continues to submit that Mr Monaghan was well aware of the consequences of his actions because in the first meeting with Ms King and Mr Gillard he immediately raised issues about the disciplinary action that might be taken because he was aware of the consequences of betting on greyhound races. It refers, in particular, to his statement that “you can’t have people betting on greyhound racing. I fully understand that.”[53] He also foreshadowed being given the opportunity to resign.

It also submits that the policy is not ambiguous and it refers in this context to the general principles set out at the bottom of page 1 which states, “You are not permitted to gamble whilst engaged by GRV in accordance with the following policy principles. You are not permitted to gamble in any form including through the use of a sports betting provider on any greyhound racing event at any time while under the employment of GRV.”[54] It continues to submit that there is no ambiguity in regard to this statement, and the policy is fair and reasonable given the history of greyhound racing in Victoria.

It continues to reject the suggestion that it is not logical for the policy to extend to betting on greyhound races conducted outside of Australia, and this fails to take into account the importance GRV places on its integrity and reputation, including the integrity and public perceptions about Stewards charged with ensuring compliance with required standards.

It also submits that there is no basis to assert that the policy is unreasonable. It does not prevent an employee from gambling, but simply restricts the field of gambling to areas that are unrelated to the employee’s employment.[55] It also submits that the recent history surrounding the establishment of the policy substantiates why it is reasonable, and it is therefore “reasonable and lawful” in the context of the circumstances referred to in Potter.

It continues to submit that Mr Monaghan “was given real opportunities to respond to the allegations put to him.”[56] For example, he was allowed to record the meeting on 7 March. He was invited to bring a support person. He made various concessions in the meeting and acknowledged that you can’t have people betting on greyhound racing. He also acknowledged that it might be difficult to change anything, given what occurred. However, he was then told by Mr Gillard that because he had no recollection of the events on the evening in question he should take time to validate and check his accounts to make sure what was being put to him was correct. He was then stood down and a further meeting scheduled to provide him with the opportunity to raise any other matters before a decision was made.

It submits that these circumstances do not support the assertion that Mr Monaghan was left with the impression that nothing he said or did was likely to make any difference to the decision that was finally to be made.

It also points to the circumstances of another Steward whose betting records initially indicated that he had placed a bet on a greyhound race. However, when the matter was investigated it was found the Steward’s partner had placed the bet, and this was taken into account before a decision was made. That employee was finally cleared of any significant wrongdoing and remained in employment with GRV. However, in the present matter Mr Monaghan had not raised any mitigating circumstances that warranted further consideration.

In regard to whether the dismissal was harsh because it was a disproportionate to the gravity of the misconduct, GRV submits that Mr Monaghan was a Senior Steward in a senior integrity role.[57] It also places great importance on its gambling policy because of its difficult recent history. It also seeks to distinguish the decision in Atfield because the employee in that matter did not know that the gambling policy extended to the TAB outlet at the hotel within the complex and, once he was warned that the policy did apply, he immediately cancelled the bet. In this case, Mr Monaghan was completely aware of the prohibition on betting on greyhounds, and even if he did not take action to immediately cancel the bet he had ample opportunity to check his betting records at some later time and to advise GRV accordingly.

It finally submits that, if his dismissal is found to be unfair, it is opposed to any consideration of reinstatement because it would be impractical for him to return as a Senior Steward, given the “breach of fundamental trust between GRV and Monaghan which cannot be reconciled.”[58] It also seeks to distinguish the decision in Farquharson on the basis that the personal circumstances of the two individuals are completely different. In that matter the employee involved had more than 30 years’ experience as a Steward. It also submits that any award of compensation should be limited, given Mr Monaghan’s limited tenure with GRV and the income he is able to derive from his own business.

Consideration

As indicated at the outset the Commission is required to determine whether Mr Monaghan’s dismissal was “harsh, unjust or unreasonable” having particular regard to the various matters set out in s.387. The circumstances in which an employee’s termination of employment might be considered to be “harsh, unjust or unreasonable” have also been considered in a number of previous decisions.

The decision in Byrne & Frew v Australian Airlines Ltd[59] is often cited in this context and has been referred to in the course of these proceedings. The joint judgement of McHugh and Gummow JJ concluded that:

“…It may be that the termination is harsh but not unjust or unreasonable, unjust but not harsh or unreasonable, or unreasonable but not harsh or unjust. In many cases the concepts will overlap. Thus, the one termination of employment may be unjust because the employee was not guilty of the misconduct on which the employer acted, may be unreasonable because it was decided upon inferences which could not reasonably have been drawn from the material before the employer, and may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted.”[60]

The decision of the Full Bench of Fair Work Australia in L. Sayer v Melsteel Pty Ltd[61] also provides guidance about the Commission’s role in regard to each of the considerations in s.387 that must be taken into account in determining whether an employee’s dismissal was “harsh, unjust or unreasonable.” The Full Bench concluded:

“Where the Applicant does present a case, in the ordinary course each of the criteria in s.387 which is capable of being relevant on the facts emerging at the hearing must be taken into account.”[62]

I now turn to deal with each of the considerations in s.387 and those authorities I consider relevant to the determination of this matter.

(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)

Before coming to the particular circumstances involved in this matter it is noted again that various authorities have had regard to what is required in order to conclude that there was “a valid reason for the dismissal related to the person’s capacity or conduct.” The judgement of Northrop J in Selvachandranv Peteron Plastics Pty Ltd[63] is often referred to in this context. His Honour came to the following conclusions:

“The reasons of an employer for terminating the employment of an employee are solely within the knowledge of the employer. The employer may state a reason but that reason need not be the actual reason nor need it be the only reason. This is the rationale for the onus of proof provisions contained in s 170EDA.
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 well founded; a valid reason’’
In its context in s 170DE(1), the adjective ‘valid’ should be given the meaning of sound, defensible or well founded. 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…”[64]

The Full Bench also came to the following conclusion in Parmalat Food Products Pty Ltd v Wililo:[65]

“The existence of a valid reason is a very important consideration in any unfair dismissal case. The absence of a valid reason will almost invariably render the termination unfair. The finding of a valid reason is a very important consideration in establishing the fairness of a termination. Having found a valid reason for termination amounting to serious misconduct and compliance with the statutory requirements for procedural fairness it would only be if significant mitigating factors are present that a conclusion of harshness is open.”[66]

The Full Bench majority in B, C and D v Australian Postal Corporation T/A Australia Post (‘Australian Postal Corporation’)[67] also provides a useful summary of the approach to be taken by the Commission in weighing the factors to be considered:

“Reaching an overall determination of whether a given dismissal was “harsh, unjust or unreasonable” notwithstanding the existence of a “valid reason” involves a weighing process. The Commission is required to consider all of the circumstances of the case, having particular regard to the matters specified in s.387, and then weigh:
(i) the gravity of the misconduct and other circumstances weighing in favour of the dismissal not being harsh, unjust or unreasonable;
against
(ii) the mitigating circumstances and other relevant matters that may properly be brought to account as weighing against a finding that dismissal was a fair and proportionate response to the particular misconduct.”[68]

It is also clear that the reason must be valid when viewed objectively. It is not sufficient that the employer believes it had a valid reason for termination. This was made clear in the Full Bench decision in Rode v Burwood Mitsubishi[69] at paragraph 19 when the Full Bench stated:

“…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.”[70]

In summary, these authorities make clear that the existence of a valid reason is often the most important consideration among the various matters in s.387 that the Commission must take account of. It is also clear that a “valid reason” is one that is “sound defensible and well founded,” as opposed to one that is capricious, spiteful or prejudiced. It must also be valid in the context of both the employee’s capacity or conduct, and the operational requirements of the business. The assessment must also be made in a practical, common sense way to ensure the parties are treated fairly in circumstances where each has rights and privileges, but duties and obligations as well.

As the decision of the Full Bench in Australian Postal Corporation also makes clear, consideration of “valid reason” inevitably involves weighing various considerations, including the conduct involved and any other mitigating or other relevant matters. I have sought to adopt the approach of these authorities in coming to a decision in this matter.

There are a number of matters that need to be considered in terms of whether GRV had a “valid reason” to dismiss Mr Monaghan. He takes issue with whether he can be said to have breached its gambling policy by placing a bet on a greyhound race that took place in the United Kingdom, particularly when the policy is silent in regard to events held outside of Australia.

There is also an issue about whether the policy, which essentially places a blanket ban on betting on any greyhound race, regardless of where it is conducted, can be considered to be reasonable in circumstances where a Steward seemingly has no ability to influence the outcome of that particular event. It is submitted in this context that there can be no logical connection between the purpose of the policy and its intent, and it should therefore be found to be unreasonable.

Mr Monaghan also submits that a policy, which applies “zero tolerance” in case of a breach, effectively denies an employee the opportunity to respond to the case made out against them.

Mr Monaghan finally submits that his dismissal was harsh because it was disproportionate to the gravity of the conduct involved.

Before coming to deal with each of these issues it is also noted at the outset that Mr Monaghan does not deny having placed a bet on the greyhound race in question, which was apparently run at Nottingham in the United Kingdom at 10.17 pm (AEST) on 31 January 2017. However, he claims that he has no knowledge or recollection of placing the bet, and believes he did so inadvertently and without actually intending to do so. I am accordingly satisfied that it is appropriate at the outset to come to a view about whether this evidence should be accepted, or whether he can be said to have acted intentionally when he placed the bet.

GRV does not necessarily rely on the fact of Mr Monaghan having acted deliberately, although it indicated in its submissions that placing the bet required more than one mouse click, including clicking on a box marked “Greys.” However, GRV indicated that it conducts an audit each year of all the bets that have been placed by all of its employees by means of their betting accounts based on information supplied to it by the betting agencies. The information provided in regard to Mr Monaghan indicated he was a regular gambler, who bet on events conducted in Australia as well as those conducted in various overseas venues. This is not to imply any criticism of him, and he indicated that he often placed bets in the evening after work as a way of relaxing and unwinding at the end of the day. He generally did so without any knowledge of the relevant “form,” and was instead guided by betting fluctuations or even the name of the horse or its number.

The evidence provided by GRV also makes clear that in all of the bets made by Mr Monaghan during the course of 2017 there was only one bet placed on a greyhound race, and it was placed relatively late in the evening, being at 10.17 p.m. (AEST) on the evening of Tuesday 31 January 2017. It was also one of a number of bets he made that evening on races conducted overseas. This evidence about the number of bets Mr Monaghan placed during the course of 2017 provides a clear indication that it was not his practice to bet on greyhound racing, no matter where those races were conducted. There is also no evidence before the Commission that provides anything to suggest that he had a particular reason to break from his normal practice and to place a bet on the particular greyhound race in question.

As indicated, I have had regard to the submission by GRV that placing the bet required at least two mouse clicks, including one on “Greys.” However, I am not satisfied in all the circumstances that it can be concluded that Mr Monaghan intentionally placed a bet on a greyhound race. I am satisfied instead that he placed the bet on a greyhound race inadvertently and by mistake and with a complete absence of deliberate intent.

I now turn to consider whether Mr Monaghan can be said to have breached GRV’s gambling policy by placing a bet on a greyhound race conducted in the UK. Mr Monaghan submits in this context that the policy is silent in relation to greyhound racing events which occur outside of Australia. In addition, there is no good reason why the policy should be construed as extending to events conducted outside of Australia.

He submits that the purpose of the policy is stated to be to protect the interests and integrity of GRV and the Victorian greyhound racing industry, therefore, how can he have acted in breach of that policy by betting on a race conducted in the United Kingdom?

GRV submits, in response, that the policy is emphatic when it states, “You are not permitted to gamble whilst engaged by GRV in accordance with the following policy principles. You are not permitted to gamble in any form including through the use of a sports betting provider on any greyhound racing event at any time while under the employment of GRV.”[71] It continues to submit that this statement of intent is unambiguous. It is also soundly based given the recent history of the greyhound racing industry in Victoria. This has included allegations of betting by Stewards on greyhound races conducted in Victoria while they were involved in the oversight of those events. It has also concerned the issues of live baiting.

I am satisfied in response that in a “black letter” sense Mr Monaghan can be said to have been in breach of the policy when he bet on a greyhound race in circumstances where he was bound by a policy that states he was “… not permitted to gamble in any form….on any greyhound racing event at any time while under the employment of GRV.”[72]

However, the next and perhaps most significant issue is whether the policy can be considered to be reasonable. Mr Monaghan points in this context to the decision of a Full Bench of the Australian Industrial Relations Commission in Potter in support of the submission that it is not necessarily sufficient to establish that a breach of policy has occurred. It is instead also necessary for the policy to be lawful and reasonable when considered on an objective basis.

The decision in Potter involved a decision on appeal from an earlier decision of a single member of the Commission. The employee was found to have disclosed confidential information about one employee to another employee, and his employment was terminated on the basis that WorkCover was satisfied his behaviour appeared to have constituted a breach of the legislative requirements regarding confidentiality. It was also of the view that in any event his behaviour constituted serious or wilful misconduct. Mr Potter’s unfair dismissal application was dismissed at first instance and he then took the matter on appeal. The Full Bench concluded that the appeal should be dismissed, although it noted that it may have been of the view that Mr Potter’s conduct warranted termination with notice, rather than summary dismissal. It also relevantly concluded in the context of this matter:

“[67] Of course breaching an employer’s policy will not of itself automatically give rise to a valid reason for termination of employment. It depends on the character of the policy and the nature of the breach. The policy in question must be lawful and reasonable. Having regard to the statutory functions performed by WorkCover we are satisfied that the policy breached by Mr Potter was both lawful and reasonable. Moreover compliance with the policy was of particular importance to WorkCover. This point was made by Mr Steer in his evidence in the proceedings at first instance in these terms: “. . . that particular policy is particularly important in our credibility and the maintenance of confidence in the system in South Australia.” Mr Steer is the General Manager of Customer Service for WorkCover.”[73]

The Full Bench concluded by indicating that it was not satisfied Mr Potter had established an arguable case of error in respect of this ground of his appeal.

Mr Monaghan also relies on the Federal Court decision in Bostick in support of his submission that the existence of the policy, and a breach of that policy, is not necessarily sufficient to justify his dismissal. He submits instead that GRV remained bound by an obligation to ensure that he was not dismissed on grounds that were harsh, unjust, or unreasonable. In Bostick the employee was dismissed for breaching a strict company policy which banned smoking. In the joint judgement of Sheppard and Heerey JJ it was acknowledged that the no smoking policy was, of course, a relevant matter. However, they continued to state:

“The employer was bound both by the Award and by the implied term in the contract of employment not to dismiss the respondent harshly, unjustly or unreasonably. No policy, whether or not promulgated with the agreement of unions at the workplace or even of the respondent himself, could vary that constraint.”[74]

They also rejected a submission from the employer that if an instruction is sufficiently clear, and the consequences of a breach of that instruction made known, then if the instruction is disobeyed the dismissal can never be harsh, unjust or unreasonable. They again stated in response:

“Employers can promulgate policies and give directions to employees as they see fit, but they cannot exclude the possibility that instant dismissal of an individual employee for noncompliance may, in the particular circumstances of an individual case, be harsh, unjust and unreasonable.”[75]

Mr Monaghan submits in the present matter that the policy was not reasonable in that extending a ban on gambling on greyhound races conducted outside of Australia lacked any clear and logical connection between the policy and its intended purpose, particularly because a Steward employed by GRV in Victoria has no capacity to influence the outcome of an event conducted in the United Kingdom or anywhere else outside of Australia. He continues to submit that there is no evident threat to the integrity of the industry in Victoria when a bet is placed outside the control or influence of GRV’s employees, and this lack of logical connection means the policy should be found to be unreasonable.

In addition, he submits that GRV has not provided a satisfactory explanation about how betting on an international greyhound event can have any effect on GRV’s integrity, particularly in circumstances involving a single bet placed inadvertently or by mistake. He also submits that the subjective opinions of various GRV employees are just that, and there is no evidence that his actions have had any detrimental effect at all on the integrity of GRV or on the integrity of the industry in Victoria. This lack of connection between the policy and its intended purpose again emphasises that it is not reasonable.

He also submits that this is brought into sharp focus when the sanction for breach of the policy is taken into account. GRV applies a “zero tolerance” approach to a breach of the policy, with summary dismissal being the outcome if the breach is found to have occurred. The serious consequences that arise from a breach of the policy again emphasise that the policy must be found to be reasonable in the first place if it is to be applied in this way.

GRV submits, in response, that the policy is fair and reasonable, given the recent history of greyhound racing in Victoria. It relies in this context on the evidence of Mr Gillard and Ms Lester. Mr Gillard’s evidence referred to the issues that the industry has had to deal with in recent times; the inquiries that have been conducted into various aspects of the industry; and the work that has been done and the changes put in place to deal with these integrity and proper conduct issues. This evidence is not seriously disputed and it can be commonly accepted and acknowledged that the industry in Victoria in recent times has had to deal with some significant issues that have attracted public notoriety.

His evidence also indicated that greyhound racing is a relatively limited activity on a global basis, and is essentially confined to events conducted in Australia, New Zealand and the United Kingdom. He also indicated that there is a significant degree of interaction between those involved in the industry in these different locations, including owners, breeders, administrators and Stewards, given the industry’s relatively limited size and scope.

Ms Lester also made much of the implications of a Steward found to have been betting on a greyhound race. She also considered that it would be inconceivable for a person to remain on the Stewards’ Panel after being found to have bet on a greyhound race, and “it would send a sign that GRV is not capable of enforcing its own integrity policies.”[76]

Mr Monaghan next takes issue about the policy being harsh and unreasonable because GRV’s “zero tolerance” approach to a breach means an employee is denied the opportunity to provide anything in mitigation. It had instead “predetermined and prejudged his circumstances and the punishment that they would give to him.”[77] GRV submits in response that Mr Monaghan was given “real opportunities” to respond to the allegations. He was allowed to record the initial meeting when the allegations were first put to him. He was invited to provide any explanation or evidence of circumstances that provided some explanation or mitigation of his behaviour. He was also given a further opportunity to take time to consider his response, given he initially claimed to have no recollection of the evening when the bet was placed, or the circumstances involved.

GRV also referred to the matter of another Steward whose betting records initially appeared to indicate he had placed a bet on a greyhound race. However, when the Steward was given the opportunity to provide further information about what had occurred it was found his partner had placed the bet using his betting account, and this was taken into account before any decision was made. It was eventually decided that the person could remain employed as a Steward. It relies on this example to demonstrate that it is prepared to take into account any information or explanation provided in response to any allegations before a decision is made. It also notes that in the present matter Mr Monaghan did not raise any mitigating circumstances or other explanation that might warrant further consideration before the decision was finally made.

Mr Monaghan finally submits that his dismissal was harsh because it was disproportionate to the gravity of the conduct involved. The circumstances relied on have been canvassed already in some of the matters referred to previously. They can be summarised on the following basis. The breach of GRV’s gambling policy was inadvertent. As a consequence Mr Monaghan was in no position to come forward and acknowledged what he had done, because he was not aware of what he had done. It was also a single bet, involving a small amount of money, and it was placed in a foreign jurisdiction.

Mr Monaghan also relies on the decision in Atfield, in support of his submission that an inadvertent breach of a gambling policy should not necessarily result in an employee being dismissed. This is acknowledged. It is also noted in that matter that the employee, when made aware of the fact he had placed a bet in breach of the gambling policy, immediately cancelled the bet. Mr Monaghan was obviously in a different position, given that the Commission has already accepted that he had no knowledge of having placed the bet on a greyhound race.
The decision in Byrne & Frew has already been referred to at an earlier point in this decision, and Mr Monaghan relies on the extract from the joint judgement of McHugh and Gummow JJ at 465 when they concluded:

“Thus, the one termination of employment may be unjust because the employee was not guilty of the misconduct on which the employer acted, may be unreasonable because it was decided upon inferences which could not reasonably have been drawn from the material before the employer, and may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted.”[78]

He relies, in particular, in the references in the judgement to his dismissal being disproportionate to the gravity of his misconduct.

In coming to a conclusion about the question of “valid reason” I am satisfied, firstly, that Mr Monaghan was clearly aware of the requirement to not bet on greyhound racing events. It also appears that he was in all likelihood aware that this prohibition generally applied to all greyhound racing events, regardless of where they were held. This is because his gambling records, which disclose a large number of bets being placed on events conducted in Australia and overseas, make clear that only one of those bets involved a wager on a greyhound race. It can be presumed that this is because Mr Monaghan was generally aware that it was not appropriate for him to be betting on greyhound races, regardless of where they were held.

He also appeared to acknowledge the likely consequences of what he had done when the allegation was put to him in the meeting on 7 March when he raised the option of being able to resign, and by acknowledging that betting on a greyhound event could likely result in his dismissal.

However, I have also had regard to the fact that the race was conducted in the United Kingdom, and it is not possible to suggest in any realistic sense that Mr Monaghan had any ability at all to influence the outcome of that event, or that he had what might be described as any “inside information” about the likely outcome of the event. I accept the evidence in this context of Mr Gillard and Ms Lester that the industry is relatively small in international terms, and there are significant connections and relationships between the participants in those countries in which greyhound events are conducted. However, I remain satisfied that there is no evidence indicating that Mr Monaghan was in any position to influence the outcome of the race involved.

I have also had regard to the fact that while GRV’s Gambling Policy does preclude betting on greyhound races, it does not explicitly state that this applies to all greyhound races, no matter where and when they are conducted. I have also had regard to the fact that the policy does not explicitly state that summary dismissal will result if an employee bets on a greyhound race, no matter where that race is conducted. It indicates instead that termination of employment could result.

I am satisfied, in conclusion, that when viewed objectively if it was intended that the policy prohibited betting on a greyhound race, no matter where and when that race was conducted, then the policy should have been explicit in stating this. In addition, if it was also intended that any such action would be viewed as serious misconduct, with summary dismissal as the only possible outcome, then it should also have been explicit in stating so.

In the absence of these specific provisions in the policy I am satisfied, on balance, that GRV did not have a “valid reason” to dismiss Mr Monaghan.

(b) whether the person was notified of that reason

This consideration is not at issue. The possibility of Mr Monaghan being terminated as a consequence of what occurred was first foreshadowed in the meeting on 7 March. He then attended the second meeting on 26 March, and after a break in the meeting was told his employment was to be terminated, effective immediately. He was then given the termination letter which confirmed the reasons for his termination.

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

Mr Monaghan places particular reliance on this consideration and submits that the “zero tolerance” approach adopted by GRV left him with no real opportunity to respond to the allegations made about him. He relies in this context on the Industrial Relations Court of Australia decision of Moore J in Wadey. It involved an incident at a child care centre, and the employee’s actions in response to the behaviour of a child who was misbehaving. His Honour concluded at page 14 of the decision:

“In my opinion the obligation imposed on an employer by that section has, for present purposes, two relevant aspects. The first is that the employee must be made aware of allegations concerning the employee’s conduct so as to be able to respond to them. The second is that the employee must be given an opportunity to defend himself or herself. The second aspect, the opportunity to defend, implies an opportunity that might result in the employer deciding not to terminate the employment if the defence is of substance. An employer may simply go through the motions of giving the employee an opportunity to deal with allegations concerning conduct when, in substance, a firm decision to terminate had already been made which would be adhered to irrespective of anything the employee might say in his or her defence. That, in my opinion does not constitute an opportunity to defend.”[79]

He continued to state at page 16:

“The relevant legal consideration is whether the opportunity given to Wadey was one in which she could defend herself given the opportunity of meeting the persuading Lehmann that her employment terminated. I am satisfied that Wadey That is, was she allegations and ought not be was given that opportunity. The final decision was not made till after the meeting and it was made by Lehmann. It is true that Lehmann did not inform Spicer of Wadey’s account. However, Wadey’s account was known to Lehmann and she was the decision-maker. I am also satisfied that Lehmann had not made a decision to terminate before she spoke to Wadey and gave Wadey the opportunity of giving her version of events. I am not satisfied that the decision to terminate Wadey’s employment involved a contravention of s 170DC.”[80]

Mr Monaghan submits in response that, in the present matter, the policy was not expressed as being one of zero tolerance and instead stated, “A breach of your obligations under this policy will be considered serious misconduct and may result in disciplinary action including termination of employment.”[81]

I am not satisfied, in response, that Mr Monaghan was denied an opportunity to respond to any reasons related to his capacity or conduct. The allegations were first put to him in the meeting on 7 March, although the earlier email he received requesting he attend the meeting had already referred to an irregularity identified in one of his betting accounts, without going to the specific details. He was then provided with details of the allegation in the meeting and asked whether he could provide any explanation in response. He was also allowed to record the discussions and invited to bring a support person.

The evidence indicates that he was then told that because he had no recollection of what had occurred on the relevant evening that he should take time to validate and check his accounts to make sure that what was being put to him was correct. He was also provided then with a further opportunity to raise any additional matters that should be taken into account before a final decision was made. However, Mr Monaghan chose to not provide any explanation about why or what might have caused him to place a bet on a greyhound race, other than that it must have occurred as a result of an inadvertent mistake.

It is also noted that GRV points to the circumstances involving another employee who also appeared on the face of it to have placed a bet on a greyhound race. However, when that employee was able to provide an explanation about what had occurred it appeared the bet had been placed by his partner, using his betting account, and no action was taken.

I am satisfied, in conclusion, that Mr Monaghan was provided with an adequate opportunity to respond to any reasons related to his capacity or conduct. It is accepted in this context that GRV started from a position that if he was found to have placed a bet on a greyhound race then the likely consequences would be termination of his employment. However, I am also satisfied that it was prepared to consider any explanation or other circumstance that might warrant a different decision being made. The reality is that Mr Monaghan did not, or chose not, to provide any other explanation other than that he had simply place the bet by mistake.

(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

This has not been raised as an issue. Mr Monaghan attended the meeting on 26 March 2018 with a representative from the Australian Workers’ Union. He had also been given an opportunity to have a support person present at the initial meeting on 7 March, but did not take up that opportunity, although he was not aware at the time of the precise nature of the allegations made against him.

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

Mr Monaghan was not provided with a warning. He was summarily dismissed on grounds of serious misconduct.

(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

I am satisfied that it is appropriate to deal with each of the above matters together. GRV is a reasonably large organisation which has dedicated human resource specialists and expertise within the organisation. It also has the ability to access external expertise. I am accordingly satisfied that it can be expected to be aware of the appropriate procedures to be followed in terminating an employee.

(h) any other matters that the FWC considers relevant

Mr Monaghan has had a long and apparently distinguished career in law enforcement and investigation, which has been referred to already in an earlier part of this decision. He also claims to have had an unblemished work record during this time and has not been warned about any disciplinary issues. This evidence was not challenged in any way. He also places great store on his reputation which has been established over a long period of time. The circumstances of this matter have accordingly come as a great shock and he now wants to do what he can to try and restore and rebuild any damage to his reputation that has occurred as a consequence.

These circumstances are not necessarily unique or exceptional, however, I am satisfied they are of particular significance in the context of this matter, given Mr Monaghan’s long career in law enforcement and integrity matters, and the value he places on his reputation in regard to his involvement in these activities.

Conclusion

I have had regard to all of the submissions and evidence provided in this matter, together with each of the matters in s.387 that I am required to take into account, as well as those authorities I consider relevant to the determination of this matter. As indicated already the Commission understands and acknowledges the recent circumstances that have caused GRV to take a hard line in regard to integrity and proper conduct issues. This is entirely appropriate. However, I have also had regard to the particular circumstances of this matter. They involve the inadvertent and isolated act of a bet being placed in the UK. This occurred in circumstances where GRV’s gambling policy did not explicitly preclude betting on international events, or make clear that summary dismissal would be the outcome if such behaviour was found to have occurred.

I am satisfied, in conclusion, that Mr Monaghan’s termination was “harsh” and he has therefore been dismissed unfairly. In coming to this decision I have had particular regard to the conclusions reached about “valid reason.” Having come to this decision I now turn to consider what remedy is appropriate.

Remedy

Section 390 of the Fair Work Act 2009 (the Act) provides as follows:

“(1) Subject to subsection (3), the FWC may order a person’s reinstatement, or the payment of compensation to a person, if:

(a) the FWC is satisfied that the person was protected from unfair dismissal (see Division 2) at the time of being dismissed; and

(b) the person has been unfairly dismissed (see Division 3).

(2) The FWC may make the order only if the person has made an application under section 394.

(3) The FWC must not order the payment of compensation to the person unless:

(a) the FWC is satisfied that reinstatement of the person is inappropriate; and

(b) the FWC considers an order for payment of compensation is appropriate in all the circumstances of the case.”[82]

Mr Monaghan wants to be reinstated to his position as a Senior Steward. He clearly enjoys the work and is committed to what he does, and believes his past experience makes him well qualified for the role. He has also been promoted during the relatively short period of time was employed by GRV. However, he also considers that reinstatement would be an important step toward him restoring his reputation. He also points out that his role generally involves him attending greyhound racing events in regional Victoria and, as a consequence, he only comes into contact with Mr Gillard or Ms Lester on rare occasions. He also submits that he would generally be welcomed back to the organisation by most of the employees he previously worked with.

He also points to the fact that the conduct that resulted in his dismissal was quite clearly a “one-off,” and an inadvertent mistake, and there is nothing to suggest it is likely to happen again. He has also closed down his betting accounts to avoid the possibility of a similar mistake being made again. In his view a relationship of trust and confidence can be restored.

GRV is strongly opposed to reinstatement. The evidence of Mr Gillard and Ms Lester is emphatic in this context, and Ms Lester considers it would be inconceivable for a Steward to be reinstated after having been found to have bet on a greyhound race. She is particularly concerned about the impact this would have in regard to GRV’s capacity and ability to enforce its own integrity policies. She was also concerned that she could no longer trust Mr Monaghan to act appropriately in the future, and his conduct went to the heart of the relationship that needs to exist between the Chief Steward and other Senior Stewards. This precludes reinstatement from being a viable option.

Previous Commission decisions have clearly acknowledged that trust and confidence is a necessary ingredient in any employment relationship, and where trust and confidence is lost reinstatement may be impractical. However, the same authorities have also held that the rationale for the loss of trust and confidence must be sound and rationally based.

The decision in Perkins v Grace Worldwide (Aust) Pty Ltd[83] is relied on by Mr Monaghan. In that matter the Full Court of the Industrial Relations Court of Australia came to the following conclusion:

“Trust and confidence is a necessary ingredient in any employment relationship… 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 … 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.
…
It may be difficult or embarrassing for an employer to be required to re-employ a person the employer believed to have been guilty of wrongdoing. The requirement may cause inconvenience to the employer. But if there is such a requirement, it will be because the employee’s employment was earlier terminated without a valid reason or without extending procedural fairness to the employee. The problems will be of the employer’s own making. If the employer is of even average fair-mindedness, they are likely to prove short-lived. Problems such as this do not necessarily indicate such a loss of confidence as to make the restoration of the employment relationship impracticable.”[84]

In addition, in the decision in Australian Meat Holdings Pty Ltd v McLaughlin[85] a Full Bench of the Commission found that:

“We accept that the question of whether there has been a loss of trust and confidence is a relevant consideration in determining whether reinstatement is appropriate. It is one factor to be taken into account, but it is not necessary conclusive.”[86]

I have also had regard to the decision in Farquharson which is also referred to by Mr Monaghan. In that matter Mr Farquarson, who was the Chief Stipendiary Steward – Harness with the QRIC was dismissed from his employment after giving inaccurate evidence in a Stewards’ enquiry hearing about an inspection he had carried out. It was concluded in response that he had not been deliberately dishonest, and the Commission then turned to consider whether reinstatement was appropriate. The decision also made reference to the matter in Perkins and concluded by stating at [71]:

“In any event, this is not a case where Mr Farquarson actually engaged in misconduct, backspace. He simply made a mistake and then failed to correct it. It was not serious misconduct and it was not a dismissible offence. In considering the matter of reinstatement in a common sense way, it seems to me that it would be a travesty of justice if Mr Farquarson was not reinstated to his former position simply because the person who, I have found, unfairly dismissed him objects to his return. Far stronger grounds than that are required before reinstatement could become impracticable.”

However, in that matter the Steward had also been employed for more than 30 years, and his extensive service was a significant factor that worked in his favour in terms of the decision that it was appropriate for him to be reinstated.

The issues concerning trust and confidence are also clearly of particular significance in this matter, even though they might not necessarily be conclusive. As a Senior Steward Mr Monaghan was evidently in a position where trust and confidence in him must be a paramount consideration, given his responsibilities concerning the proper conduct of the greyhound racing events he is assigned to. The focus on the role of the Stewards has inevitably been brought into sharper focus as well by the broader issues impacting on the industry in Victoria in recent times. This has involved the issue of live baiting, although it is not suggested that Mr Monaghan had anything to do with this issue. However, as the evidence makes clear the industry has also had to confront a significant issue concerning the behaviour of Stewards, including betting on races they were in control of. The evidence makes clear that these issues have culminated in an intense focus on integrity issues in the industry, and indeed resulted in the appointments of Mr Gillard, Ms Lester, and Ms King.

It is perhaps unfortunate for Mr Monaghan that these issues have such prominence at this point in time, but I am satisfied that they do mean that there is inevitably an enhanced focus on integrity issues at GRV at this time, and a heightened sense of concern when expected standards are not met. It also means that trust and confidence is an essential part of the relationship that needs to exist with someone in the role of Senior Steward.

I have already made clear that I am satisfied Mr Monaghan placed the bet inadvertently, and with no intention of doing so. He also claims to have closed down his betting account to prevent such mistakes from happening again. Nevertheless, I am satisfied that his conduct has caused there to be a significant lack of trust and confidence in him, particularly given the evidence of the Chief Steward, Ms Lester, and therefore it is not appropriate for him to be reinstated. I now turn to consider whether it is appropriate for an order for compensation to be made to Mr Monaghan.

Compensation

Section 392 of the Act states:

“392 Remedy—compensation

Compensation

(1) An order for the payment of compensation to a person must be an order that the person’s employer at the time of the dismissal pay compensation to the person in lieu of reinstatement.

Criteria for deciding amounts

(2) In determining an amount for the purposes of an order under subsection (1), the FWC must take into account all the circumstances of the case including:

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

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

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

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

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

(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; and

(g) any other matter that the FWC considers relevant.

Misconduct reduces amount

(3) If the FWC is satisfied that misconduct of a person contributed to the employer’s decision to dismiss the person, the FWC must reduce the amount it would otherwise order under subsection (1) by an appropriate amount on account of the misconduct.

Shock, distress etc. disregarded

(4) The amount ordered by the FWC to be paid to a person under subsection (1) must not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt, caused to the person by the manner of the person’s dismissal.

Compensation cap

(5) The amount ordered by the FWC to be paid to a person under subsection (1) must not exceed the lesser of:

(a) the amount worked out under subsection (6); and

(b) half the amount of the high income threshold immediately before the dismissal.

(6) The amount is the total of the following amounts:

(a) the total amount of remuneration:

(i) received by the person; or

(ii) to which the person was entitled;

(whichever is higher) for any period of employment with the employer during the 26 weeks immediately before the dismissal; and

(b) if the employee was on leave without pay or without full pay while so employed during any part of that period—the amount of remuneration taken to have been received by the employee for the period of leave in accordance with the regulations.”[87]

In concerning the amount of compensation to be ordered it is necessary to take into account all the circumstances of the case, including the specific matters identified in s.392(2) (a) to (g), and to consider the other relevant requirements in s.382. The long established approach to the assessment of compensation under s.392 is to apply the formula derived from the Full Bench decision in Sprigg v Pauls Licensed Supermarket (‘Sprigg’)[88]. This approach was more recently confirmed in the context of the present legislative framework in Bowden v Ottrey Homes Cobram and District Retirement Villages Inc. T/A Ottrey Lodge (‘Bowden’).[89] The first and perhaps most important step to be taken is to determine what the Applicant would have received by way of remuneration, or would have been likely to receive, if the person had not been dismissed. This was described in Bowden in the following terms at [33]:

“[33] The first step in this process - the assessment of remuneration lost - is a necessary element in determining an amount to be ordered in lieu of reinstatement. Such an assessment is often difficult, but it must be done. As the Full Bench observed in Sprigg:
‘... we acknowledge that there is a speculative element involved in all such assessments. We believe it is a necessary step by virtue of the requirement of s.170CH(7)(c). We accept that assessment of relative likelihoods is integral to most assessments of compensation or damages in courts of law.’

[34] Lost remuneration is usually calculated by estimating how long the employee would have remained in the relevant employment but for the termination of their employment. We refer to this period as the ‘anticipated period of employment’…”[90]

Once this first step has been undertaken various adjustments are then required to be made in accordance with the requirements in s.392, such as income earned since the time of dismissal, contingencies, any reduction on account of the employee’s misconduct, and the application of the statutory salary cap of six months’ pay. This approach is, however, subject to the overarching requirement to ensure that the amount of any compensation awarded is an amount that is considered appropriate having regard to all the circumstances of the case.

I now turn to deal with the matters in s.392 in the order in which they appear. There is nothing to suggest that an order for compensation will have any effect on the viability of GRV. Mr Monaghan had also only been employed by for a relatively limited period of time by GRV at the time he was dismissed, although he had been promoted to a Senior Steward in that time, and had received a bonus in November last year.

The Commission is next required to consider what remuneration the person would have received if they had not been dismissed. This involves making an estimate about how long they might have remained in employment had they not been dismissed. As indicated already, this is inevitably a matter that is difficult to come to precise conclusions about. Mr Monaghan generally had a good employment record, apart from the issue that led to his employment being terminated, and it could be expected that he would have continued in his role for a further period of time, if not for him being dismissed. Even if he did act in breach of the policy there are random checks made from time to time on betting activity, although GRV only conducts an audit at the end of each year. I am satisfied that it reasonable to conclude that in all the circumstances he would have been employed for a further period of at least 12 months, barring some unforeseen eventuality. His evidence indicates that as a Senior Steward he would have earned $85,406.00 in that time.

Mr Monaghan has also made efforts to mitigate his losses, as his evidence makes out, and he has returned to work as a consulting private investigator. He estimates that in the past twelve months in this role his annual earnings have been in the vicinity of $60,000 to $65,000. His evidence also indicated that he would expect to earn a similar amount in this role in the future. I am accordingly satisfied that it is reasonable to assume that he will earn approximately $62,500 in the twelve month period following his dismissal. This amount should be deducted from the figure of $85,406.00.

The decision in Sprigg also makes reference to the requirement to consider the impact of contingencies and whether they should have any impact on the amount to be awarded. The consideration of contingencies only applies to the anticipated period of employment. I am satisfied that it is it appropriate to make a deduction of 20% from the total amount in respect of these potential uncertainties.

The Commission is also required to discount the amount that might be awarded on account of any misconduct that contributed to the decision to dismiss the person. This is a significant consideration in this case. I have already indicated that the evidence makes clear that Mr Monaghan was generally aware that it was not appropriate to bet on a greyhound race, even though the Commission has concluded that the fact he did so and the outcome that resulted was harsh. However, Mr Monaghan also acknowledges that he was strictly aware that betting on a greyhound race was inappropriate, and he should not have placed the best. I am satisfied that his misconduct clearly contributed to GRV’s decision to terminate his employment, and it is therefore appropriate to reduce the amount that might otherwise be awarded by an appropriate amount on account of the misconduct. I am satisfied that a deduction of 25% is appropriate in this context.

The compensation cap is referred to in s.392(5), and provides that the amount ordered by the Commission must not exceed the lesser of the total amount of remuneration either received by the person, or to which the person is entitled, for any period of employment with the employee during the 26 weeks immediately before the dismissal, and half the amount of the high income threshold immediately before the dismissal. That amount was $142,000 per annum at the time of Mr Monaghan’s dismissal. The amount of compensation proposed is clearly well below the compensation cap.

Conclusion as to Remedy

The final amount of compensation that has accordingly been arrived at is as follows:

·   Step one: lost remuneration (12 months) – $85,406.00
·   Step two: remuneration earned or likely to be earned – $62,500.00
·   Step three: deduction for contingencies (20 percent ) – $4,581.20
·   Step four: deduction for misconduct (25 percent) – $4,581.20

The final amount of compensation which is derived from the above considerations is therefore $13,743.60, less deduction of any tax as required by law. I am satisfied that this amount of compensation is an appropriate amount in all the circumstances. In accordance with s.392(1) the amount of the order does not include any compensation by way of compensation for shock, distress or humiliation, or other analogous hurt caused to the applicant by the manner of his dismissal.
I accordingly order that the Respondent pay the Applicant the sum of $13,743.60 within 21 days of the date of this decision. An order to this effect is issued in conjunction with this decision in PR620057.

COMMISSIONER

Appearances:

A White of Counsel for the Applicant

R Frenzel for Greyhound Racing Control Board T/A Greyhound Racing Victoria

Hearing details:

2018.
Melbourne:
July 5.

[1] Fair Work Act 2009 (Cth) s 385.

[2] Fair Work Act 2009 (Cth) s 387.

[3] Exhibit JM1, [6].

[4] Exhibit JM1, Annexure JM-1.

[5] Exhibit JM1, [9].

[6] Exhibit JM1, Annexure JM-4.

[7] Exhibit JM1, Annexure JM-6.

[8] Exhibit JM 1, [19].

[9] Exhibit JM1, Annexure JM-7.

[10] Exhibit JM1, [23].

[11] Ibid, [24].

[12] Ibid, 29].

[13] Ibid, [30].

[14] Ibid, 31].

[15] Ibid, [41].

[16] Ibid, Annexure JM-10.

[17] Applicant’s submissions, dated 28 May 2018, [9].

[18] Ibid, [10].

[19] Ibid, [11].

[20] Ibid, 12].

[21] Transcript, 5 July 2018, PN 354.

[22] Applicant’s submissions, dated 28 May 2018, [15].

[23] Potter v WorkCover Corporation (PR948009, Ross VP, Williams SDP, Foggo C, 15 June 2005).

[24] Transcript, 5 July 2018, PN 335.

[25] Transcript, 5 July 2018, PN 349.

[26] Transcript, 5 July 2018, PN 362.

[27] Transcript, 5 July 2018, PN 362.

[28] [1996] IRCA 568 (12 November 1996).

[29] Ibid, [15].

[30] Applicant’s submissions, dated 28 May 2018, [22].

[31] (1995) 185 CLR 410.

[32] (1992) 36 FCR 20.

[33] (2002) 123 IR 273.

[34] Applicant’s submissions, 28 May 2018, [30].

[35] Ibid, [32].

[36] (1997) 72 IR 186.

[37] [2018] QIRC 1.

[38] Exhibit GRV3, [9].

[39] Ibid, [17].

[40] Ibid, [18].

[41] Ibid.

[42] Ibid.

[43] Exhibit GRV2, [7].

[44] Ibid, [8].

[45] Ibid, [10].

[46] Exhibit GRV1, [5].

[47] Ibid, Annexure B.

[48] Ibid, Annexure C.

[49] Ibid, 19].

[50] Ibid, [24].

[51] AE423947.

[52] Transcript, 5 July 2018, PN 390.

[53] Respondent’s submissions, dated 18 June 2018, [34] citing Exhibit JM1, Annexure JM-8, p 1.

[54] Transcript, 5 July 2018, PN 424.

[55] Respondent’s submissions, dated 18 June 2018, [26].

[56] Ibid, [30].

[57] Ibid, [50].

[58] Respondent’s submissions, dated 18 June 2018, [58].

[59] (1995) 185 CLR 410.

[60] Ibid, 465.

[61] [2011] FWAFB 7498.

[62] Ibid, [20].

[63] (1995) 62 IR 371.

[64] Ibid, 373.

[65] [2011] FWAFB 1166.

[66] Ibid, [24].

[67] [2013] FWCFB 6191.

[68] Ibid, [58].

[69] Print R4471 (AIRCFB, Ross VP, Polites SDP, Foggo C, 11 May 1999.

[70] Ibid, [19].

[71] Transcript, 5 July 2018, PN 424.

[72] Ibid.

[73] Potter v WorkCover Corporation (PR948009, Ross VP, Williams SDP, Foggo C, 15 June 2005), [67].

[74] Bostik (Australia) Pty Ltd v Gorgevski (No 1) (1992) 36 FCR 20, 28.

[75] Ibid, 29.

[76] Exhibit GRV2, [10]

[77] Transcript, 5 July 2018, PN 362.

[78] Byrne & Frew v Australian Airlines (1995) 185 CLR 410, 465.

[79] Wadey v YWCA Canberra [1996] IRCA 568 (12 November 1996), [14]-[15].

[80] Ibid, [16].

[81] Transcript, 5 July 2018, PN 282.

[82] Fair Work Act 2009 (Cth) s 390.

[83] [1997] IRCA 15 (7 February 1997).

[84] Ibid.

[85] Print Q1625.

[86] Ibid, p 17.

[87] Fair Work Act 2009 (Cth) s 392.

[88] (1998) 88 IR 21.

[89] [2013] FWCFB 431.

[90] Ibid, [33]-[34].

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