Kardell v South Eastern Sydney Area Health Service

DECISION NO:261/97

CATCHWORDS

INDUSTRIAL LAW - EMPLOYMENT LAW - TERMINATION OF EMPLOYMENT - Consideration of the meaning of VALID REASON - A wide range of allegations were made against the applicant, concerning HER CONDUCT AND PERFORMANCE, almost all of which the respondent failed to prove - In particular, a multiplicity of allegations concerning improper and intimidatory conduct by the applicant were fabrications - The limited extent to which the allegations against the applicant were proven did not establish that her conduct or performance had been such as to warrant the termination of her employment - If the penalty of termination of employment is out of proportion to the seriousness of the conduct complained of, then the termination of employment will not be justifiable, and will not be for a valid reason - TERMINATION OF EMPLOYMENT UNLAWFUL, as not for a VALID REASON.

INDUSTRIAL LAW - EMPLOYMENT LAW - TERMINATION OF EMPLOYMENT - The Acting Chief Executive Officer of the respondent, who made the decision to terminate the applicant’s employment, made that decision upon the basis of a memorandum which contained serious factual errors concerning the applicant’s conduct. Those matters (being mistakes by the author of the memorandum) were never put to the applicant before the termination of her employment - As a result, the applicant never had the OPPORTUNITY TO RESPOND to them required by section 170DC of the Act, and the termination of her employment was UNLAWFUL.

INDUSTRIAL LAW - EMPLOYMENT LAW - TERMINATION OF EMPLOYMENT - REINSTATEMENT - Whether APPROPRIATE - Whether IMPRACTICABLE - Consideration of the principles involved in determining whether it is IMPRACTICABLE to order REINSTATEMENT - REINSTATEMENT is the primary remedy for an unlawful termination of employment, and should therefore be ordered, unless the Court finds it IMPRACTICABLE so to do - “Impracticable” means something less than impossible, but reinstatement will not be impracticable if it is merely inconvenient, difficult, or disruptive, without causing an unacceptable problem, or unacceptable embarrassment, or seriously effecting productivity, or seriously effecting harmony within the employer’s business. Any adverse consequences to the employer are relevant, but it must be remembered that an employee whose employment has been unlawfully terminated has suffered an injustice and that should be made right, if it can.

Workplace Relations Act 1996, ss: 170DC, 170DE(1), 170EDA(1)(a), 170EE, 482

Anthony Smith and Associates Pty Ltd v Sinclair (1996) 67 IR 240

Cox v Australian Meat Corporation Pty Ltd, von Doussa J, Industrial Relations Court of Australia, 14 June 1995, unreported

Fargie v Freedom Foods (Aust) Pty Ltd, Industrial Relations Court of Australia, Parkinson J, 14 October 1996, unreported

Johns v Gunns Ltd, [1995] 60 IR 258

Kerr v Jeroma Pty Ltd, Industrial Relations Court of Australia, Marshall J, 7 October 1996, unreported

Malik v Bank of Credit and Commerce International S.A. (In Compulsory Liquidation) [1997] 3 WLR 95

Nicolson v Heaven and Earth Gallery Pty Ltd [1994] 1 IRCR 199

Patterson v Newcrest Mining Ltd, Industrial Relations Court of Australia, Marshall J, 21 December 1995, unreported

Patterson v Newcrest Mining Ltd, Industrial Relations Court of Australia, Full Court, 6 June 1996, unreported

Perkins v Grace Worldwide (Aust) Pty Ltd, Industrial Relations Court of Australia, Full Court, 7 February 1997, unreported.

KARDELL v SOUTH EASTERN SYDNEY AREA HEALTH SERVICE

NI 3625 of 1995

BEFORE:                  Judicial Registrar Patch
PLACE:  Sydney
DATE:  8 September 1997

IN THE INDUSTRIAL RELATIONS COURT
OF AUSTRALIA
NEW SOUTH WALES DISTRICT REGISTRY

NI 3625 of 1995

BETWEEN:

CYNTHIA KARDELL
Applicant

AND

SOUTH EASTERN SYDNEY AREA HEALTH SERVICE
Respondent

BEFORE:     Judicial Registrar Patch
PLACE:        Sydney
DATE:          8 September 1997

MINUTES OF ORDERS

THE COURT ORDERS AND DECLARES THAT:

The applicant be allowed to file her application by 2 December 1995.
Within seven days of today the respondent shall reinstate the applicant by reappointing her to the position in which she was employed immediately before the termination of employment.
The employment of the applicant is, for all purposes, deemed to have been continuous in the position in which she was employed immediately before the termination of her employment, up to the time of her reinstatement.
The respondent is to take such steps as may be necessary to maintain the continuity of the applicant’s employment for all purposes.
The respondent is to pay the applicant the amount of remuneration lost by the applicant as a result of the termination of her employment, in accordance with the principles set out in the reasons for judgement herein.
If an agreement is reached between the parties within fourteen days of the date of this judgement on the question of the gross amount of remuneration lost, consent orders may be filed pursuant to Order 35 Rule 10.
Within seven days of today, the applicant is to provide the respondent with copies of all documentation in her possession or control concerning any remuneration earned by her since the termination of her employment, together with the names, addresses and telephone numbers of all persons who have provided that remuneration.
Any monies paid by the respondent to the Commissioner of Taxation as taxation in respect of the monies ordered to be paid to the applicant for remuneration lost shall be deemed to have been paid in pro tanto satisfaction of the judgement debt.
Liberty to apply on seven (7) days notice.

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
NEW SOUTH WALES DISTRICT REGISTRY

NI 3625 of 1995

BETWEEN:

CYNTHIA KARDELL
Applicant

AND

SOUTH EASTERN SYDNEY AREA HEALTH SERVICE
Respondent

BEFORE:     Judicial Registrar Patch
PLACE:        Sydney
DATE:          8 September 1997

REASONS FOR DECISION

The applicant claims that the termination of her employment was unlawful, and seeks reinstatement. In the alternative, if the Court were to find that reinstatement was either inappropriate or impracticable, the applicant seeks compensation. The applicant also claims interest on any monies ordered to be paid to her.

THE LONGEST HEARING IN THE HISTORY OF THE COURT

The hearing of the evidence, and oral submissions, took 42 sitting days, which were spread out over a period of more than a year. Eighteen witnesses gave evidence, there were nearly 200 exhibits, and transcript is just short of 3000 pages long.

There were many issues in the case - all of which were explored exhaustively.

The cross-examination of the applicant alone took eight days. Much of this cross-examination was repetitive, and directed towards questions on credit. Other witnesses were also cross-examined at great length.

This has been a very difficult judgement to write - not only because of the vast volume of material which had to be carefully considered. As will be seen below, questions of credit play an important role in the decisions which I have reached, both on questions of fact and on what orders to make. As the reputation of some several people will probably be affected by this judgement, it was necessary to be extremely careful in reaching conclusions as to matters of personal credit. The evidence had to be very carefully analysed.

The Court has ordered the reinstatement of the applicant. The Court is aware that the applicant will return to a Department which has been marked by interpersonal conflict and rivalries for at least the last six years. The Court urges all those in the Department to remember that they are professionals, and that they all should focus on working together for the long term good of their patients, and the community that the Department and the Hospital service.

BACKGROUND FACTS

The applicant’s employment history

The applicant’s date of birth is 26 June 1948. In 1971 she obtained her certificate in radiation therapy. In 1974 she commenced working for a predecessor of the respondent Area Health Service when she was engaged as a radiation therapist in the Radiation Oncology Department of the Prince of Wales Hospital.

She worked there continuously until 11 August 1995, when she was suspended from duty with pay. On 20 October 1995 her employment was terminated by the respondent. She was paid a further five weeks wages, as pay in lieu of notice.

At the commencement of the trial of this matter, there was an issue as to whether the suspension of the applicant on 11 August 1995 amounted to her “constructive dismissal”. Suffice it to say that, in my opinion, the termination of her employment occurred on 20 October 1995. Shortly after her suspension, an application was field in this Court claiming in effect, that she had been constructively dismissed. On 1 December 1995, a further application was filed in respect of the termination of employment which occurred on 20 October. The respondent has always been on notice that the termination of the applicant’s employment was challenged, and does not oppose an order that she be allowed to file her (2nd) application out of time.

In 1979 she was appointed Chief Radiation Therapist, and held that position until the time of the termination of her employment.

At the time of the termination of her employment, the applicant’s annual salary was, in round terms, $54,000.00 (gross).

The position of Director of Radiation Oncology

In 1991 Professor Withers left the position of Director of Radiation Oncology. The normal recruitment procedures were put in train, including international advertising, and, in late 1993 or early 1994, Professor Thomas indicated, on a provisional basis, that he would accept the position. However, after spending some time in the Department, in March or April 1994 Professor Thomas advised the Prince of Wales Hospital that he would not, in the end, take up the position.

For about 6 months in 1991, Dr Hedy Mameghan acted in the position of Director of the Department of Radiation Oncology.

From November 1991 to 4 April 1995, Dr Robert Smee acted in the position of Director of the Department of Radiation Oncology.

On 5 April 1995, Dr Smee was appointed, for a period of 3 years, to the position of Director.

That appointment followed attempts from 1991 to recruit a permanent appointee.

Up until and including the time that Professor Thomas declined to take up the position, it had always been a “conjoint” position, involving an appointment at Associate Professor or Professor level in the Faculty of Medicine at the University of New South Wales.

For reasons which I will set out below, Dr Smee’s appointment as Director on 5 April 1995 did not involve a conjoint appointment with the University of New South Wales.

After Professor Thomas declined to accept the position, Dr Smee continued as the Acting Director. For a while, no specific decision was taken to recommence recruitment for the position, and the matter was left in abeyance. It seems that Professor Thomas’ refusal to accept the position had created difficulties in recruiting a replacement. Furthermore, there were internal tensions within the department, which had become known outside. That was also a factor.

In about mid 1994, Dr George Bearham, the Director of Clinical Services for the Prince of Wales Hospital, in consultation with at least Professor Michael Friedlander, the Director of Medical Oncology in the Department of Medical Oncology at the Prince of Wales Hospital, and with Mr Brian Johnston, the Executive Director for the hospitals known as the Prince Henry and Prince of Wales Hospital Group (within the then Eastern Sydney Area Health Service, which operated those, and other, hospitals) decided to readvertise for the position of Director of the Department of Radiation Oncology.

As a result of that decision, the position was advertised both within Australia and internationally.

Four applications were received before the deadline. One application was received late, from overseas, (Dr S Ling) but that application was assessed by Dr Bearham, and excluded as a late application.

Of the four applications made before the deadline, one of them, Dr M Maher, was “culled” by Dr Bearham (after consultation with, at least, Professor Friedlander), because, in Dr Bearham’s opinion, his job history did not suggest that he had the requisite experience. Another factor in not giving Dr Maher an interview was the fact that he was from overseas. I accept Dr Bearham’s evidence as to why Dr Maher was not called for an interview.

The three remaining candidates were Dr Hedy Mameghan, Dr Robert Smee, and Dr Quenten Walker.

Dr Smee and Dr Mameghan were specialist oncologists, already working at the Prince of Wales Hospital. Dr Walker was a senior staff specialist in oncology at the Queensland Radium Institute.

All three of those remaining applicants were invited to attend a meeting of the Medical Appointments Advisory Committee (“the MAAC”) on 12 December 1994.

In his statement (Exhibit 168) Dr Bearham said this:

“24.Of the four applicants received in time I formed the view that none of them fully met the requirements of the job either from the hospital’s point of view or that of the University in providing the conjoint position.
25.I decided against calling Mr Maher from overseas to attend for an interview. His job history did not suggest he had the requisite experience.
26.The three remaining local candidates, Dr Mameghan, Dr Smee and Dr Walker were all submitted for interview even though I believed none of them fully satisfied the requirements of the position.
27.Dr Mameghan had limited management experience as Acting Director of the department for six months. Dr Walker had no management experience. None of the candidates appeared to have the requisite level of clinical and basic research. Nevertheless I decided that all three should be interviewed as the decision was a matter for the MAAC.
28.In circumstances where none of the candidates are likely to be appointed to the position it is not uncommon to go through the process in any event. Ultimately the decision is one for the MAAC. There is an education and development benefit in allowing candidates to be interviewed even if it is unlikely that they will be appointed. The process gives them the experience of being interviewed and demonstrating desire for advancement.”

A perusal of the applications of those three candidates (which are to be found as part of Exhibit 86) supports Dr Bearham’s view that “none of them fully satisfied the requirements of the position”. I accept Dr Bearham’s evidence as to why, nonetheless, all three of them were granted an interview.

THE DECISION OF THE MEDICAL APPOINTMENTS ADVISORY COMMITTEE ON 12 DECEMBER 1994 TO RECOMMEND THE APPOINTMENT OF DR SMEE AS DIRECTOR OF THE DEPARTMENT OF RADIATION ONCOLOGY.

Did Dr Bearham, Dr Smee, and Mr Johnston conspire to ensure the appointment of Dr Smee to the position of Director?

A great deal of the 42 days of evidence was concerned with this controversy.

However, during cross-examination of Dr Bearham, (the 2nd last witness in the respondent’s case), counsel for the applicant, on instructions, abandoned the allegation that there had been such a conspiracy.

The existence of such a conspiracy was rejected by all those alleged to have been involved. I accept their evidence.

The genesis of the allegation that Dr Bearham, Dr Smee and Mr Johnston had conspired to ensure the appointment of Dr Smee as the Director of the Department was a conversation that Dr Mameghan overheard between those persons in either April or May 1994.

He said that he was in his office, and the door was open. He said that Dr Smee, Dr Bearham and Mr Johnston were in the corridor outside his office, and that he could see them and hear them, through the crack in the door between the wall and the door, where the hinge edge of the door is. He said the door was partly open, and he went up to it to listen.

Dr Mameghan said that he could not recall the exact words of the conversation, but that it went something like this:

Mr Johnston “Do you want this job or not?” (said to Dr Smee)
Dr Smee“Yes, I’d love it” or “I’d love to”.
Mr Johnston “Well, let’s go for it. All right then. Let’s get on with it.”
Dr Mameghan’s evidence as to the tone of the conversation was as follows:
“The tone was familiar. It was three people who know each other well and who have been working well together and decided that something should happen. It’s as if it’s a sort of a conference on the corner of a corridor, kind of putting the final touches on it. Okay, let’s do it kind of thing.”

Dr Mameghan said that Dr Bearham said nothing in that particular conversation, but that the three of them stood there in a triangle.

Very shortly after he had overheard that conversation, Dr Mameghan repeated it to a number of people, including Dr Fisher (the medical statistician in the Department of Radiation Oncology, a staff specialist position) and the applicant.

It is unnecessary to traverse the evidence as to what Dr Mameghan said to Dr Fisher and the applicant, in view of my finding that there was no conspiratorial agreement as originally asserted.

I accept that Dr Mameghan believed that the conversation that he had overheard was an improper agreement between those present to ensure the appointment of Dr Smee to the position of Director. However, in my view, he was mistaken.

It must be borne in mind that there had been a long history of internal conflict in the Department. Senior medical staff, and other staff, including the applicant, had been at loggerheads over the running of the Department for several years. Dr Mameghan and Dr Smee, although they maintained a professional relationship, frequently disagreed about matters to do with the running of the Department. There was certainly a degree of personal animosity between them at the time that Dr Mameghan overheard the conversation.

In the context of the above circumstances, what happened, in my opinion, was that Dr Mameghan put a “gloss” on an innocent conversation in which the persons involved were discussing the desirability of readvertising for the position, and the possibility that Dr Smee would apply for it. There was, of course, nothing improper in Mr Johnston or Dr Bearham suggesting that Dr Smee apply for the position - or even in encouraging him to do so.

Dr Mameghan repeated the conversation he had overheard to the applicant, together with the “gloss” that he put on it.

As a result of that, Ms Kardell came to believe, at the very least, that there was a real possibility that such a conspiratorial agreement had been reached. Her readiness to accept that was, for much the same reasons as Dr Mameghan, conditioned by the years of conflict within the Department that had preceded Dr Mameghan telling her about the conversation he had overheard.

Dr Mameghan is a serious and responsible person, and a dedicated, obviously talented, and hardworking doctor. Even persons of his calibre can jump to the wrong conclusion. In my opinion, that is exactly what he did.

Were some members of the Medical Appointments Advisory Committee improperly biased in favour of Dr Smee at the meeting on 12 December 1994?

This issue was raised by counsel for the respondent in cross-examination of Dr Mameghan, during which she asked Dr Mameghan his opinion as to the honesty, or integrity, of various of members of the MAAC.

Dr Mameghan gave evidence which was, to put it mildly, uncomplimentary when he was asked these questions, and stated, speaking generally, that in some respects, some of the members of the MAAC were dishonest, or biased (or the like).

Counsel for the respondent then proceeded to call these people to knock down the “straw man” that she had put up. She succeeded in doing that.

I do not accept, having listened to those witnesses and Dr Mameghan carefully, that any of the members of the MAAC acted dishonestly, or improperly, at the meeting on 12 December 1994.

A considerable portion of the time in this very lengthy case was taken up with this useless controversy. If counsel for the respondent had left the evidence as it was, and not cross-examined Dr Mameghan in the way she did, then there would have been no substantive suggestion about the lack of integrity of any members of the MAAC - apart from the alleged conspiratorial conversation, which is dealt with above.

Why the Medical Appointments Advisory Committee recommended the appointment of Dr Smee.

As noted above, Dr Bearham was of the opinion that none of the persons called for interview were qualified for the job, as advertised. One of the critical pre-requisites for the job was a strong background in clinical and basic research. Dr Smee clearly did not have the requisite level of clinical and basic research.

Dr Bearham, in his evidence, said that the situation in the Department was, in his opinion, such that the Department could not be allowed to go on with only an “acting” director. Accordingly, prior to the meeting of the MAAC on 12 December 1994, he and Mr Johnston had decided that, if the MAAC did not recommend the appointment of any of the candidates to the position “as advertised”, (which was what he had expected would happen) he would suggest that the MAAC appoint the most suitable of the three candidates to the position, on the basis that it would not be a “conjoint” appointment with the University. One result of this would be that the requirement for a strong background in clinical and basic research would no longer apply. The position would be managerial and clinical.

Accordingly, when the MAAC decided that none of the candidates were suitable for the position, as advertised, Dr Bearham suggested that Dr Smee be appointed to the position of Director, for a 3 year term, on the basis that it would not be conjoint appointment. The MAAC agreed with that, and recommended that Dr Smee be appointed.

Although, in my opinion, this process was open to criticism on the basis that, because the position to which Dr Smee was appointed had not been advertised (it being quite different from the position which had been advertised) the equal employment opportunity guidelines of the Area Health Service had been breached, I do not find that Dr Bearham recommended that the MAAC adopt that course through any improper motives.

I accept that his concern was to stabilise the management of the Department, after a long period of conflict and instability, by the appointment, finally, of a permanent Director. I accept that he had reached the conclusion, on reasonable grounds, that it would not be sensible, at least in the short term, to re-advertise nationally and internationally for a “conjoint” position, as originally advertised.

The events following the recommendation from the Medical Appointments Advisory Committee on 12 December 1994 that Dr Smee be appointed to the position of Director

In December 1994, the applicant wrote to Mr W Lawrence, the Chief Executive Officer of the (then) Eastern Sydney Area Health Service in relation to the recommendation. The letter (Exhibit 20) was 8 pages long. I will not attempt to summarise it. In essence, however, the applicant had two principle concerns about what had happened. These were:

The position to which Dr Smee had been appointed had not been advertised - thereby denying to those who might have been qualified for the position (as appointed), but who might not have been qualified for the position as advertised, the chance to apply for the position. This was, the applicant asserted, a breach of the Area Health Service’s policy guidelines.

By appointing Dr Smee to a position which was essentially only managerial and clinical, without the necessity for a strong background in clinical and basic research, and on the basis that it was a management position and not a “conjoint” appointment with the University of New South Wales, the Area Health Service had “downgraded” the status of the position. This, the applicant asserted, would weaken the position of the Department overall.

Dr Mameghan also complained. Initially he did this by way of a letter to Professor Ron Pirola at Prince Henry Hospital dated 19 December 1994, and then by letter to Mr Lawrence dated 4 January 1995. Dr Mameghan’s complaints were as follows:

The inclusion of two applicants for interview without proper regard for the advertised criteria;

The exclusion of at least one applicant, possibly another, from interview who did have qualifications consistent with the advertised criteria;

The decision to reconstitute at interview in contravention of relevant Policy;

The implications, both short and long term, of such downgrading of the position of Director of Radiation Oncology for our training programs and our staffing levels;

The recommendation to appoint someone to this new position without advertisement;

The unfair discriminatory action inconsistent with equal employment opportunity principles;

The apparent discriminatory action in denying me the appointment on the basis of merit against the advertised criteria.”

Mr Lawrence referred the complaints to Mr John Kilkeary, the Director of Corporate Services of the (then) Eastern Sydney Area Health Service.

Mr Kilkeary did a thorough examination of the relevant material and the background to the situation, and reported to Mr Lawrence by way of an 18 page memorandum, with lengthy attachments, on 6 March 1995.

In Mr Kilkeary’s opinion, the complaints concerning the decision to call the three persons for interview, and the decision not to appoint any person to the position as advertised, could not be sustained. In particular, he made what was, in essence, the same point as Dr Bearham, namely, that it was quite appropriate to grant “courtesy” interviews to applicants, even though it seemed that they would not succeed in their application for a position.

In relation to the decision by the MAAC to recommend that Dr Smee be appointed to a newly constituted (unadvertised) position of Director, on a non-conjoint basis, for 3 years, Mr Kilkeary said that he felt that that could “be defended”.

Despite that view, Mr Kilkeary went on to say in his report:

“Notwithstanding these points however, I think a more fundamental question has to be addressed. That is, is it reasonable to expect that an applicant who applied for an advertised position would expect that if an appointment were not made that an announcement would be made making an appointment to a position with different criteria? I think the answer is no.

Firstly, others may have applied had they known the criteria for appointment was less rigorous and the internal applicants may have responded differently to the requirements of the new position. The complaints lodged by Dr Mameghan and Ms Kardell vindicate this point.

It may be that if the new position were advertised either internally or externally that a selection committee may come to exactly the same conclusion. But that is not the point.

The Area Health Service advertises all positions as an EEO employer and I do not believe the recommendation made in this case would been seen as conforming to the Area’s stated policy.”

Mr Kilkeary then went on to make some observations regarding Dr Mameghan and the applicant. It is clear from those observations, and other comments in the body of his report to Mr Lawrence, that he thought that, in all probability, Dr Mameghan and the applicant had put their heads together in relation to the making of their complaints. It is also clear that he thought that Dr Mameghan and the applicant had made their complaints, at least in significant part, because of their position in what Mr Kilkeary described as “factional dissatisfaction” in the Department. Mr Kilkeary said:

“There is obvious dialogue between the two which suggests that one, if not both, complaints is based on continuing the factional fighting within the Department.”

I mention this at this point, because it later became apparent that Mr Kilkeary and others at the senior levels of the Area Health Service and Hospitals Group, regarded the applicant’s perceived role in this factionalism as an important matter.

Mr Kilkeary went on to make three recommendations, in paragraph 18 of his report. These were:

“13.1That the recommendation of the Hospital MAAC to appoint Dr Smee as the Director, Radiation Oncology for a period of three (3) years renewable be not approved.
13.2In lieu thereof the position be advertised internally for a fixed term of three (3) years on the terms and conditions set out in the letter from Dr Bearham to me dated 31 January 1995 (ref Section 8).
13.3.That the Area Health Service collaborate with the Hospitals Group Executive to eliminate the staff conflict which exists in the Department of Radiation Oncology with a view to removing the stigma attached to that department.”

Those recommendations were accepted by Mr Lawrence.

On 10 March 1995 Mr Kilkeary wrote to the applicant informing her of the Area Health Service’s response to her complaint. That letter is Exhibit 4. Mr Kilkeary informed the applicant of the first two recommendations only - they being the only recommendations made in direct response to her, and Dr Mameghan’s, complaints.

Mr Kilkeary paraphrased his comments about the correctness of the procedure adopted by the MAAC in deciding to recommend the appointment of Dr Smee to a position that had not been advertised by saying, “whilst this course is open to the Hospital Executive the Area Health Service is concerned that a perception may exist that correct procedure may not have been followed.”

Dr Mameghan was also informed, at about the same time as the applicant, of the recommendations.

The applicant, shortly after being told of the recommendations, spoke to other people in the Department. There was nothing wrong with this. The recommendations were not confidential, and it was the intention of the Area Health Service to advertise internally for the position of Director of the Department of Radiation Oncology.

WAS THERE A VALID REASON FOR THE TERMINATION OF THE APPLICANT’S EMPLOYMENT?

Section 170DE (1) of the Workplace Relations Act 1996 (“the Act”) is as follows:

“170 DE (1) [Termination must be for a valid reason] An employer must not terminate an employee’s employment unless there is a valid reason, or valid reasons, connected with the employee’s capacity or conduct or based on the operational requirements of the undertaking, establishment or service.”

Section 170EDA (1) (a) provides that a termination of employment is “taken to have contravened section 170DE (1) unless the employer proves that ..... there was a valid reason, or valid reasons, of a kind referred to in subsection 170DE (1).”

The meaning of “valid reason” in section 170DE (1) of the Act.

The phrase “valid reason” is not defined in the Act. However, section 170CB of the Act reads as follows:

“An expression has the same meaning in this Division as in the Termination of Employment Convention.”

It is therefore necessary to examine the Termination of Employment Convention (“the Convention”) in order to determine the meaning of the phrase “valid reason”. The Convention is Schedule 10 of the Act.

Article 8, paragraph 1 of the Convention is as follows:

“A worker who considers that his employment has been unjustifiably terminated shall be entitled to appeal against that termination to an impartial body, such as a court, labour tribunal, arbitration committee or arbitrator.”

Article 9, paragraph 1 of the Convention is as follows:

“The bodies referred to in Article 8 of this Convention shall be empowered to examine the reasons given for the termination and other circumstances relating to the case and to render a decision on whether the termination was justified.”

Article 9, paragraph 3 of the Convention is as follows:

“In cases of termination stated to be for reasons based on the operational requirements of the undertaking, establishment or service, the bodies referred to in Article 8 of this Convention shall be empowered to determine whether the termination was indeed for these reasons, but the extent to which they shall also be empowered to decide whether these reasons are sufficient to justify that termination shall be determined by the methods of implementation referred to in Article 1 of this Convention.”

Article 10 of the Convention is as follows:

“If the bodies referred to in Article 8 of this Convention find that termination is unjustified and if they are not empowered or do not find it practicable, in accordance with national law and practice, to declare the termination invalid and/or order or propose reinstatement of the worker, they shall be empowered to order payment of adequate compensation or such other relief as may be deemed appropriate.”

It is apparent from the repeated use of variations of the word “justified” in the Convention, that a reason is not a valid reason if it cannot be “justified”.

What this means is that a termination of an employee’s employment cannot be for a “valid reason” unless it is “defensible or justifiable on an objective analysis of the facts”. See Kerr v Jeroma Pty Ltd, Industrial Relations Court of Australia, Marshall J, 7 October 1996, unreported, at page 21.

It is necessary, therefore, to examine the totality of the circumstances in which the termination of employment occurred. In a case, such as this, where a multiplicity of allegations and criticisms were levelled at the dismissed employee, merely because one, or some, of those allegations have been proven, (in part or in whole), does not necessarily mean that the termination of employment has been shown to be for a valid reason, or valid reasons.

As Parkinson JR said in Fargie v Freedom Foods (Aust) Pty Ltd, Industrial Relations Court of Australia, 14 October 1996, unreported:

“For a reason to be relied upon for terminating a person’s employment there must be a proportion between the matter relied upon and the penalty of termination proposed. When termination of employment is a penalty so out of proportion in response to the conduct complained of, such a termination is unlikely to be for a valid reason.”

In other words, if the “penalty” of termination of employment is out of proportion to the seriousness of the conduct complained of, then the termination of employment will not be justifiable, and will not be for a valid reason.

On 29 August 1995, following the suspension, with pay, of the applicant on 11 August 1995, Mr Kilkeary, on behalf of Dr John Campbell (the Acting Chief Executive Officer of what by then had become the South Eastern Sydney Area Health Service) wrote to the applicant’s solicitor, Mr William Szekely. In that letter, a number of allegations were made, and the applicant was requested to respond. It was made clear that the applicant’s position was in jeopardy if a satisfactory explanation was not provided. That letter became Exhibit 11.

The various allegations against the applicant were broken up under subheadings, which contained, within the general areas covered by the subheadings, a multiplicity of allegations.

I will refer to the allegations by using the same subheadings as those in Exhibit 11.

The appointment of an unqualified radiation therapist - Ms Ingrid Marsman

There was a great deal of detailed evidence concerning this allegation. It should be made clear from the outset that the evidence establishes that Ms Marsman was not qualified to be appointed to a position within the Hospital as a radiation therapist.

But that simple finding of fact does not end the matter. The initial question, in terms of the applicant’s conduct and performance, is whether the applicant reasonably believed that at the time she arranged for Ms Marsman to be appointed as a radiation therapist in January 1992, Ms Marsman was qualified for that appointment.

A subsidiary, but also an important point, is whether the applicant actually had that belief, irrespective of whether that belief was reasonable.

It is also necessary to examine the (changing) circumstances in which the applicant continued to maintain Ms Marsman in the position of a radiation therapist.

The respondent’s submissions in respect of this allegation are replete with overstatements. Phraseology such as “reckless indifference to her responsibility as Chief Radiation Therapist”, an allegation of treating the complaints of senior staff “with complete disdain”, an allegation that the applicant’s initial advice that Ms Marsman be appointed “was given with reckless indifference” and that the applicant’s actions “can only be described as wilful misconduct”, were of little assistance to the Court.

Ms Marsman was originally employed in the Department of Radiation Oncology in 1976 and 1977. Before that, she had worked in Germany.

For personal reasons, she left the employment of the respondent. She sought re-employment in January 1992. At that time, the Department was suffering from a severe staff shortage. The applicant was, therefore, pleased when a former employee applied for re-employment.

I accept the applicant’s evidence that there were three reasons why she believed, in January 1992, that Ms Marsman was appropriately qualified:

She had previously been employed in such a position.

A reference in Ms Marsmann’s personnel file (held in the applicant’s office) dated 24 January 1978 (Exhibit 72) from Ms Lyons, the applicant’s predecessor as Chief Radiographer, asserted that “Ingrid Marsman has worked in this Department since May 1975 as a qualified radiographer till this date .....”. The reference went on to say “We would be happy to re-employ her when she returns to Australia”.

The Hospital Employees Technical (State) Award (the relevant parts of which are Exhibit 71) defines a radiographer as follows:

“ ‘Radiographer’ means a person who has acquired the Certificate of the Conjoint Board of the College of Radiologists of Australasia and the Australasian Institute of Radiography or the Diploma of the Australasian Institute of Radiography or such other qualification as deemed by the Health Administration Corporation to be equivalent”.

(Emphasis added)

In my opinion, the combined effect of the above factors provided a reasonable basis for the applicant to believe that Ms Marsman was appropriately qualified to be appointed. In particular, the award provision seems to give the respondent (the successor to the “Health Administration Corporation”) the right to deem qualifications to be the equivalent to those listed specifically in the award.

I accept the applicant’s evidence that she believed that, by having appointed Ms Marsman in 1976, the Health Administration Corporation had “deemed” Ms Marsman’s German qualifications to be the equivalent of the specific qualifications set out in the award.

This is not to say that the applicant was actually correct in that belief. In fact, in my opinion, for Ms Marsman to have fitted into the qualification phrase “or such other qualification as deemed by the Health Administration Corporation to be equivalent” it would have been necessary for the Health Administration Corporation (or more precisely its successor) to have actually considered such qualifications as Ms Marsman possessed, and have made a decision. That did not occur. However, minds differ, and the wording of the award did not set out the process by which other qualifications would be “deemed....to be equivalent”.

After Ms Marsman started work in 1992, Ms Schneider and Ms Harfield objected (to the applicant) to Ms Schneider being employed as a radiographer. I accept that, from 1992 until and including 1995, Ms Schneider and Ms Harfield raised their objections from time to time with the applicant. I accept that the applicant always disagreed with Ms Schneider and Ms Harfield.

I do not accept, however, Ms Schneider’s and Ms Harfield’s evidence that the way in which the applicant disagreed with them, and rejected their criticisms, was intimidatory, dominating, or hostile.

It is probable, in my opinion, that from time to time, over the years, there were some heated discussions involving Ms Schneider, Ms Harfield and the applicant on the subject of whether Ms Marsman should continue to work as a radiographer, and the details of the work she was doing from time to time.

In my opinion, it was this situation of repeated disagreements which led, over time, to the deterioration of the working relationship between Ms Schneider and Ms Harfield, on the one hand, and the applicant on the other. By 1994 that working relationship had degenerated to the point where Ms Schneider and Ms Harfield had strong feelings of hostility towards the applicant.

In my view, the applicant was too stubborn and inflexible in the way that she dealt with the objections and criticisms of Ms Schneider and Ms Harfield. She is a proud woman, and had been Chief Radiographer for a long time. She should have paid more attention to what they were saying.

In June 1992 the Overseas Qualifications Assessment Panel of the Australian Institute of Radiography declined to recognise Ms Marsman’s German radiography qualifications. The letter said:

“Your application for recognition of your Radiography qualifications has been considered and compared against the standard required in Australia.
I regret to advise that the academic standard and training undertaken by you are not equivalent to those gained in Australia and therefore not recognised.”

The applicant saw that letter shortly after its date of 12 June 1992. When she saw that letter, it should have rung alarm bells for her. Apparently, it did not.

Instead of reacting to the letter, and taking steps to insure that Ms Marsman was, in fact, properly qualified, the applicant continued to act on her belief that, in employing Ms Marsman in 1976, the Health Administration Corporation had “deemed” Ms Marsman’s German qualifications to be the equivalent of the specific qualifications as set out in the award.

In my view, she should not have done that. It was a mistake. The mistake was repeatedly, in one way or another, pointed out by Ms Harfield and Ms Schneider. As it turned out, on the question of Ms Marsman’s qualifications, Ms Schneider and Ms Harfield were right, and the applicant was wrong.

The applicant should have advised Dr Smee (who was the Acting Director of the Department) as soon as she became aware in 1992 of the position of the Australian Institute of Radiologists that Ms Marsman’s qualifications were not sufficient. At that point, the applicant should have realised that, others having questioned Ms Marsman’s qualifications, it was time to refer the matter up the “chain of command”.

That said, it is necessary to remember that, despite the refusal of the Australian Institute of Radiography, the applicant believed that Ms Marsman was in fact, qualified to work as a radiographer in terms of the award. If she did not have that belief, her actions in refusing to accept the objections and criticisms of Ms Harfield and Ms Schneider, and not referring the decision of the Australian Institute of Radiography to Dr Smee, would be far more serious than they actually were.

In 1994 the rules changed. In particular, the regulations regarding the operation of the radiation treatment machines became such that radiographers could not operate the machines without a certificate from the Environmental Protection Authority of NSW.

The applicant became aware in January 1995 that Ms Marsman’s application for a licence from the EPA had been rejected.

In my opinion, the applicant should have acted more quickly than she did in response to this information. Some further criticism can validly be made of her in this respect.

From 1992 the applicant ensured that Ms Marsman worked as part of a team, under the supervision of more experienced radiographers. This was principally because Ms Marsman’s experience at the hospital (in 1976 and 1977) had not been a general experience, and because she had been away from working in the field for such a long time.

Nonetheless, I accept that there were the occasional times when Ms Marsman, although not working alone, worked with relatively inexperienced radiographers (although they were qualified). There is, however, no evidence that any patients were actually put in danger as a result of these infrequent occurrences.

Dr Smee gave evidence (which was contrary to what he had said in his statement) (transcript p.2715) that Ms Marsman’s employment from 1992 to 1995 “was not prejudicial to the maintenance of proper standards of patient care” ..... “because she functioned in a supervised position”.

I regard that evidence as significant. It reinforces my view that, because of the way in which she was employed, standards of patient care were not significantly affected by Ms Marsman’s appointment in 1992.

I agree with the applicant’s submissions that there is no basis upon which the respondent can assert that the applicant acted with “reckless indifference”.

Dr Smee himself became aware, in or about June 1994, of the concerns of the applicant’s immediate subordinates, Ms Schneider and Ms Harfield, as to Ms Marsman’s qualifications. At about the same time, or, at least, within a few months of that time, the applicant herself advised Dr Smee of the questions regarding Ms Marsman’s qualifications. Despite this knowledge, Dr Smee took no action. This puts the applicant’s actions into a different perspective.

In my view, although some considerable criticism can be made of the applicant’s conduct and performance in relation to the “Marsman matter”, that criticism is not of a sufficiently serious nature to warrant the termination of the applicant’s employment.

The evidence establishes that the standards of patient care were not significantly adversely affected by the appointment of Ms Marsman. Furthermore, although Dr Smee was aware of the position of the Australian Institute of Radiography in 1994, he took no action himself for many months. No action has been contemplated by the respondent to discipline him - indeed, as I understand the matter, no criticism has even been made of him in respect of that.

That the applicant’s conduct in respect of Ms Marsman’s appointment was not sufficiently serious to warrant dismissal was certainly the view of Dr Bearham and Mr Kilkeary when, in March 1995, they decided that this matter, together with other matters, was only sufficient to warrant a “last warning”.

Did the applicant “undermine the authority” of Dr Smee in his position as Director of the Department of Radiation Oncology?

From the outset, it is necessary to consider whether such an allegation, even if established, could ever amount to a “valid reason” for the termination of the applicant’s employment.

There could never be a rule that employees are barred from making criticisms of their superiors or their employers. Indeed, in certain circumstances, it is possible to envisage a situation where employees would be bound to make such criticisms. The situation could arise, for example, where an employee became aware that a superior in the organisation for which the employee was working was acting corruptly. In those circumstances, the employee would have a duty, at least to the employer organisation as a corporate entity, to expose the corrupt conduct.

A recent House of Lords case is authority for the proposition that if the business of an organisation is being carried on fraudulently or corruptly that conduct itself would be in breach of the contract of employment between the employer and the employee. This is because it would be in breach of the implied term that the employer would not, without reasonable and proper cause, conduct itself in a manner likely to destroy or seriously damage the relationship of confidence and trust between the employer and the employee. See Malik v Bank of Credit and Commerce International S.A. (In Compulsory Liquidation) [1997] 3 WLR 95. In such a circumstance the employee would have the right to repudiate the contract of employment, and sue for damages. It follows that the employee would also have the right to expose the fraudulent or corrupt conduct concerned.

The question of whether an employee can criticise the actions of an employer, or a superior within the employer’s structure, depends on the particular circumstances of each case. The question of whether the conduct of an employee in criticising the conduct of the employer is appropriate or inappropriate is also a question of degree, depending on the particular circumstances of each case. The question of whether even inappropriate criticism by an employee warrants the termination of the employee’s employment is, once again, a question of degree - for it must be remembered that the “penalty” of termination of employment must not be out of proportion to conduct of the employee which the employer complains of.

In this context, it should be noted that the days of “master and servant” have disappeared in Australia. The modern relationship of employer and employee can longer be simply characterised as one of domination and subservience. In the modern working world, employees are entitled to be assertive. They are entitled to, in private conversations with fellow employees, to be openly critical of their employer, and of management. They are entitled to, in private conversations with other employees, to say rude things about their employer and about management. That sort of behaviour is part of the normal working environment in most workplaces.

The allegations concerning the alleged “undermining” of Dr Smee’s authority, as set out in Exhibit 11 (the letter dated 29 August 1995 from the respondent to the applicant in which the respondent set out the multiplicity of allegations in respect of which the applicant’s employment was said to be in jeopardy) were limited to matters which occurred after the appointment of Dr Smee as Director. The relevant part of Exhibit 11 referred (incorrectly) to this appointment as having been made in May 1995, but nothing turns on that mistake. The applicant well knew that the appointment had actually occurred on 5 April 1995, and would not have been misled by that error.

(a) Did the applicant behave in an openly aggressive way to Dr Smee, and did she “put him down” in conversations?

The allegation of “undermining” was split up into two sections in Exhibit 11. The first section was in paragraph 2(a) of the document, as follows:

“Ms Schneider and Ms Harfield have stated that their professional relationship with Ms Kardell deteriorated further with the appointment in May 1995 of Dr Smee as Director. Ms Kardell it is claimed displayed ‘outrage’ at the appointment and was openly aggressive in her actions towards Dr Smee which made staff ‘uncomfortable’. Further Ms Kardell is said to have put Dr Smee down in conversation, calling him a ‘Dictator’ and saying uncomplimentary things about him, i.e. ‘he’s irrational’, ‘his language skills are appalling’.”

As it turned out, Ms Schneider gave no evidence at all in respect of the allegations in the above paragraph of Exhibit 11.

Ms Harfield’s evidence as to the so-called “openly aggressive” behaviour of the applicant to Dr Smee fell considerably short of establishing any sort of aggression, let alone “open” aggression. Her evidence as to what she considered to be “openly aggressive” behaviour was as follows:

The applicant’s body language changed.

Sometimes the applicant would “require” Dr Smee to speak to her notwithstanding that he was in a planning session at the time.

The applicant would sometimes follow Dr Smee from the session rooms into the planning cubicle asking him questions and demanding his time.

The applicant would sometimes say to Dr Smee things like “You are to come here, you are to sign this” and “Don’t leave yet, Bob, I want you to sign this” or, “You have to attend this matter now. Don’t leave the floor until you’ve seen me”.

Dr Smee also gave some evidence about the applicant’s body language and way of addressing him. He said that after his appointment on 5 April 1995 that sort behaviour was experienced to a lesser extent.

The evidence establishes that there had been, over some years, a degree of personal disharmony between Dr Smee and the applicant. Both the applicant and Dr Smee, in my opinion, did not, at times, behave as politely to each other as they should have.

In my opinion, the examples of supposed “openly aggressive” behaviour set out in Ms Harfield’s evidence, and, to a lesser extent, in Dr Smee’s evidence, are nothing more than examples of impolite, or tense, behaviour by the applicant.

These sorts of situations occur often enough in workplaces, and the applicant’s behaviour did not warrant the termination of her employment. Indeed, in my view, although it would have been better for the applicant and Dr Smee to have treated each other with unvarying politeness, to require or expect this would have been to ask the impossible.

In respect of the allegations that the applicant “put Dr Smee down in conversation”, I do not regard that as a proper matter for criticism. Members of staff, even those at a middle management level such as the applicant, are entitled to say rude things about their superiors in private conversations. The applicant denied using that particular terminology, but I accept that, even if she did not use that particular terminology, she did say, in private conversations, rude and uncomplimentary things about Dr Smee. Even given that, that sort of uncomplimentary or rude way of describing Dr Smee is, in the modern industrial climate, the sort of terminology that she is entitled to use without fear of repercussion.

The respondent has not established that these allegations constitute a valid reason for the termination of the applicant’s employment.

(b) Dr Smee’s memo dated 6 July 1995 regarding problems in communication.

Paragraph 2(b) of Exhibit 11 is as follows:

“On 6 July 1995 Dr Smee wrote a memo to Ms Kardell and the seven (7) other senior radiation therapists in the Department, advising them that he wished to convene a fortnightly meeting with them in order to improve communication and documentation. It had been brought to Dr Smee’s attention that there were a number issues of concern which had been raised by senior radiation therapy staff, that had not been resolved satisfactorily. He stated in the memo ‘that there have been some examples recently in relation to the accelerators, the planning area and patient treatment, where improvement in communication could take place’.
On 10 July Ms Schneider and Ms Harfield state that Ms Kardell met with senior radiation therapy staff and could hardly control her anger in respect of this proposed meeting. She demanded to know ‘what have you been doing to each other that Bob is doing this to me?’. Ms Harfield responded that ‘Dr Smee was only asking for a staff meeting’.
Straight after this confrontation Ms Kardell attended the combined staff meeting (a meeting with all senior representatives of sections within the Department). Ms Kardell completely misrepresented the wishes of the senior radiation therapy staff when she informed Dr Smee and the Committee that these senior staff did not wish to hold a meeting with him in attendance. Ms Schneider and Ms Harfield were informed of the misrepresentation by a senior nurse Ms Choo. The had no alternative but to approach Dr Smee and inform him that at least six of the seven senior radiation therapists wanted such meetings convened.
Ms Kardell’s memo to Dr Smee dated 18 July, objecting to his decision to initiate this meeting (attached as Appendix 1,) clearly demonstrates Ms Kardell’s insubordination and a total reluctance to follow the directions of the Director of Radiation Oncology Dr Smee. Subsequently these meetings have been held on a fortnightly basis. They are reported to be most successful in achieving the outcomes set by Dr Smee. However, Ms Kardell has openly displayed her hostility at these meetings insisting that minutes be amended to the smallest detail.”

It is important to put this allegation in context. The memo dated 6 July 1995, referred to in paragraph 2(b), became Exhibit 63. The effect of that memorandum was to implement a significant change in the functioning of the Department. Up until that memorandum, the applicant had attended what were called “combined staff meetings” as the representative of the radiation therapists. The “combined staff meetings” were in fact meetings of senior staff, and not general meetings of staff. See for example Exhibit 78, which is the document containing the minutes of the combined staff meeting on 10 July 1995.

The text of Exhibit 63 (which was, it should be remembered, sent to all of the applicant’s senior subordinates) was as follows:

“The quality assurance process that we are going through as part of the reaccreditation programme for the Hospital has highlighted the importance of communication and documentation. There have been some examples recently in relation to the accelerators, the planning area and patient treatment, where improvement in communication could take place. I thus propose a fortnightly meeting to start with between the Senior Radiation Therapists and myself where these matters can be discussed and appropriate action taken. The first meeting will be in the small conference room at 11 am on Tuesday, 11th July. Work schedules should be arranged such that everyone is available at that time for a period of 15-20 minutes.
(signed)
Dr R Smee
Director
Department of Radiation Oncology”

The applicant was not consulted about the supposed areas where “improvement in communication could take place”. It is clear that this memorandum was intended to be, and was in fact, a criticism of the applicant. See the evidence of Dr Smee at transcript p.2692.

In my view, it was poor management practice by Dr Smee to circulate a memorandum such as Exhibit 63 to the applicant and her immediate subordinates without first having discussed the matter with her. It was to be expected that she would regard it as a public criticism of her. In fact that is exactly what it was. It was perfectly reasonable of her to be offended by Dr Smee’s actions in circulating the memorandum. What Dr Smee did was heavy-handed and confrontationist - and, it must be remembered, was in the context of a Department which had a history of conflict.

As it turned out, none of the criticisms of the applicant set out in Exhibit 63 can be sustained.

(c) Dr Smee’s memo dated 6 July 1995 regarding the breakdown of the RMS on the Clinac Eighteen machine.

The communication problem in relation to the “accelerators” (the treatment machines) was further set out in Exhibit 58, which was a memorandum from Dr Smee to the applicant. That memorandum was as follows:

INTERNAL MEMORANDUM

To: Ms Cynthia Kardell
Chief Radiographer

From:            Dr R Smee
  Director
  Department of Radiation Oncology

Date: 6 July 1995

Subject: Breakdown of the RMS on the Clinac Eighteen
______________________________________________________________________

Particular importance has been placed in the past on having Record and Verify systems on the accelerators and this in fact has resulted in our purchase of the IMPAC system. I was thus quite concerned, given the importance of the Record and Verify concept to find out via very indirect means that in fact the RMS on the ‘Eighteen’ had been down for 10 days without my being notified of that event. There is certainly no point in spending a significant amount of month repairing the Varian system given the imminent arrival of the IMPAC, however, it would have been appropriate to notify the clinicians concerned, particularly myself as Director, that the Eighteen was operating without any monitoring system for a significant period of time. This problem was heightened by the absence of a senior radiographer on that machine during part of this period.

I would thus appreciate your response in writing as to why I was not notified.

(signed)
DR R SMEE
Director
Department of Radiation Oncology

It was simply incorrect of Dr Smee to say that he found out “via very indirect means that in fact the RMS on ‘Eighteen’ had been down for 10 days without my being notified of that event”.

The RMS is a machine which monitors the dosages that patients receive, and helps control the dosage, thereby ensuring they receive the correct dose. The ‘Clinac Eighteen’ is one of the radiation therapy machines.

On the evening of Friday 30 June 1995 the applicant was informed, for the first time, that the RMS on the ‘Clinac Eighteen’ had been out of action since Tuesday 27 June 1995. She then, virtually immediately, telephoned Dr Smee and informed him of this fact. Dawne Harfield also telephoned Dr Smee on 30 June 1995 and gave him the same information.

The applicant had been sick on Tuesday 27 June and Wednesday 28 June, and did not return to work until Thursday 29 June. She acted responsibly and informed Dr Smee about her knowledge of the breakdown of the RMS as soon as she knew. I accept her evidence in this respect.

I also accept Ms Harfield’s evidence that she telephoned Dr Smee and told him on 30 June 1995 that the RMS was down.

In addition, Dr Smee was physically present on 4 July 1995 when a patient received an under dosing as a result of the RMS on the ‘Eighteen’ being down. This under dosing is referred to in a Patient Dosing Incident Report which is Exhibit 57. That report was dated 1 August 1995, although signed by Ms Schneider on 3 August 1995.

Furthermore, on 4 July 1995 Kevin Fitzsimmons discussed the breakdown of the RMS with Dr Smee. Mr Fitzsimmons is one of the principals of Radiation Services Australia Pty Ltd, which is contracted to the Prince of Wales Hospital to maintain the equipment in the Radiation Oncology Department. I accept his evidence about the conversation on 4 July 1995 with Dr Smee.

The above facts were set out in a memorandum from the applicant to Dr Smee dated 8 July 1995. (Exhibit 59)

I am satisfied that Dr Smee received that memorandum prior to the combined staff meeting on 10 July 1995. Dr Smee and the applicant were present at that meeting. The relevant part of the minutes of that meeting are as follows:

“CK queried the proprietary of the meeting called by RS to be held between him and the senior radiographers. CK said that if there were any problems in radiography they should have been discussed with her first. She said that just before this head of sections meeting she had met with her senior staff and none of them could suggest why the meeting in question should be called. She requested that RS provide her with a list of any problems. RS said that she had not reported the failure of the RMS verify service. She questioned why other sections had no similar meetings. RS said that the proposed meeting would look at things he is unhappy with. He also said that should the need arise similar meetings with other groups will be implemented. RS also said that these meetings with the radiographers would be held fortnightly and maybe become monthly.”

It was simply not correct for Dr Smee to say at that meeting that the applicant “had not reported the failure of the RMS verify service”. She had reported it to Dr Smee, and had reported it as soon as she could. Dr Smee had been reminded that she had done that by virtue of her memorandum dated 8 July 1995.

It was also not correct for Dr Smee to say in his memo to the applicant of 6 July 1995 (Exhibit 58) that he found out about the RMS breakdown “via indirect means”. He had been told directly by the applicant and by Ms Harfield. He had also been told by Mr Fitzsimmons on 4 July. He was also physically present on 4 July when an under dosing occurred as a result of the RMS being out of service, and was, therefore, directly aware from that incident (in addition to the fact that he had been told in no uncertain terms some 4 days earlier) that the RMS was not functioning.

In my opinion, the assertion by Dr Smee at the combined staff meeting of 10 July 1995 (an assertion made, not privately to the applicant, but publicly in the presence of virtually all the other senior staff of the Department) that the applicant “had not reported the failure of the RMS verify service” was deliberately untrue and intended to publicly undermine the applicant’s standing in the department.

In my view, the applicant behaved quite properly at the combined staff meeting on 10 July 1995. She was perfectly entitled, at that meeting of senior staff, to raise the matters that she did, in the way that she did. In particular, in my view, it was a legitimate response to the memo instituting the meetings between Dr Smee and the senior radiographers (Exhibit 63) to say that “if there were any problems in radiography they should been discussed with her first”.

In fact, Dr Smee’s untrue statement that the applicant had not reported the failure of the RMS verify service was, in all probability, an improper attempt to undermine the applicant’s position, and was said as a defensive reaction to the applicant’s criticism of his decision to call the meetings with senior radiographers.

I do not accept that at that meeting on 10 July 1995 the applicant “completely misrepresented the wishes of the senior radiation therapy staff”.

In saying this, I accept that, at the meeting of the senior radiation therapy staff (ie: the applicant and her senior subordinates) held on 10 July 1995, the applicant expressed her disagreement with the fact that Dr Smee was instituting the meetings with senior radiation therapy staff, said something to the effect that she should have been consulted, and said something to the effect that, in her opinion, Dr Smee was undermining not only her authority, but the authority of the other senior radiographers. I accept that she did ask for examples of any problems in communication. I accept that she was very upset, and visibly so.

Despite this, in my view, there was nothing improper in her behaviour. After all, Dr Smee had openly criticised her for her management practices. As it turns out, those criticisms cannot be sustained. Dr Smee’s management practice in circulating the memo (Exhibit 63)without first consulting with the applicant was confrontationist and likely to cause the applicant offence.

I accept, in essence, the applicant’s evidence as to what occurred at the senior radiation therapists meeting on 10 July. Her evidence was, in essence, corroborated by Ms Hedges. It was not contradicted by any evidence except the evidence of Ms Harfield. For reasons which are set below, where the evidence of the applicant and the evidence of Ms Harfield conflict, I prefer the evidence of the applicant.

Before moving from this point, it is necessary to comment on one aspect of the respondent’s submissions. In the respondent’s submissions (paragraph 53 of the submissions) concerning Dr Smee’s decision to issue Exhibit 63 without first consulting with the applicant, counsel for the respondent said:

“in any event whether Dr Smee’s approach be right or wrong, it did not justify Ms Kardell attempting to undermine his authority. In this regard, Dr Smee was her superior and she had no entitlement to object to his decision .....”.

I reject that position. The applicant had every right to, appropriately, object to Dr Smee’s decision - particularly as it was one that directly affected her. She did so appropriately. Firstly, at the meeting on 10 July 1995, and later in a memo dated 18 July, which became Exhibit 64. It was only natural that, having been publicly criticised for matters which, as it turns out, there was no basis for criticism, she was offended.

Because of the importance that the respondent attached to Exhibit 64, both in the case, and in Exhibit 11 (the letter setting out the allegations in respect of which the applicant’s employment was in jeopardy, to which it was attached) I reproduce it here:

Memorandum to: Dr R Smee, Director, Radiation Oncology

From: Ms C Kardell, Chief Radiation Therapist

Date: 18 July 1995

Subject: Senior Radiation Therapist’s Meeting

Dear Bob,

I wish to formally record my objection, as stated at the Combined Staff Meeting held 10 July 1995, to your decision (in your memorandum dated 6 July) to initiate the above meeting.

Regrettably you have neither accorded me the courtesy of discussing your intentions nor given me the opportunity to answer criticisms implicit in your memorandum regarding communication between ‘accelerators, the planning area’ etc. These are both issues which are central to continuing mutual respect for the positions we hold and the things which flow from them.

You stated at the Combined Staff Meeting held Monday 10 July that one of the reasons for your decision was the ‘RMS’... that is the (mistaken) belief that I had failed to report its withdrawal from service. Yet this matter had not even been raised by you with me before my receipt on Friday 7 July of both the written request (dated 6 July) for an explanation, together with the notice of your decision (also dated 6 July). Other examples of poor communication (by me) were said to include a recent radiation incident, also the subject of a memorandum dated 6 July and received by me 7 July.

That is you have used examples of there being poor communication within our group which have little or nothing to do with the group, have no basis or, at your time of writing, are an unknown quantity. This is not what good communication is about.

You again identified your decision as a solution to a specific problem when you replied, at the meeting 10 July, that you do no plan similar meetings with the physicists or nurses.

I stated at the meeting 10 July that I had met, immediately before the Combined Staff Meeting, with the senior radiation therapists who were not able to point to anything which could be described as an example of where communication within the group could be improved.

Ms Schneider and Ms Harfield did put forth two events for consideration. They are: (1) the unexpected visit by Varian personnel which had nothing to do with this group (refer written apology from Mr B Judson, Varian Pty Ltd received by you) and (2) the RMS, which as you would now know, was not a reason for complaint (refer advice from D Zavasky dated 10 July). Finally Ms Hedges mentioned criticism from you that she would not put a patient on the 6MV. You would now know that Ms Hedges was correct in that we did not (and still do not) have data for use in calculations.

As a matter of practice your decision has the practical effect of undermining the position of the Chief Radiation Therapist and consequentially that of the three senior personnel who have an overarching supervisory responsibility in the Department as distinct from the specific responsibility attaching to the major treatment and planning Units. It provides for a confusion of roles and tears at existing and effective paths of communication.

And then finally at the inaugural meeting, you reiterated the same points in relation to the RMS and radiation accidents (still the subject of an inquiry made by you to me, dated 6 July). You stated the meeting’s objectives to be matters (accreditation etc) which are presently delegated for action by the Chief Radiation Therapist.

In conclusion I would like to record my disappointment and make the comment that I consider integrity of purpose to be central to good communication and continuing trust and confidence in your administration.

(signed)
Cynthia Kardell

Exhibit 64 was annexed to Exhibit 11 as an example of the applicant’s “insubordination and .... total reluctance to follow the directions of the Director of Radiation Oncology Dr Smee” (See Exhibit 11, page 4).

It was nothing of the sort. In fact, in my view, Exhibit 64 was a moderately worded document, appropriately expressing the applicant’s disagreement with both the decision of Dr Smee to initiate senior radiation therapists meeting, and the manner in which he had gone about doing that.

The assertion in Exhibit 11 (an assertion maintained throughout the case) that it demonstrates “insubordination” and “a total reluctance to follow the directions of the Director of Radiation Oncology Dr Smee” reveals a management attitude at the senior levels of the South Eastern Sydney Area Health Service which required an unrealistic, and even oppressive, degree of lickspittle subservience.

In summary, in my view, the respondent has not made good its claim that, after the appointment of Dr Smee on 5 April 1995, the applicant “undermined his authority”.

The draft letter dated 14 March 1995

In its written submissions, the respondent relied upon the applicant’s involvement with this letter as constituting a valid reason for the termination of her employment.

A draft letter, bearing the date 14 March 1995, and addressed to Mr Lawrence, (the Chief Executive Officer of the Area Health Service) is Exhibit 2. That letter was never sent. I am satisfied that the applicant had a major role in preparing the letter. It was as follows:

“We the undersigned wish to express our deep concern over the above stated decision for the following reasons:
* Internal advertisement is essentially always unfair to all the parties and in the current circumstances doubly so. It denies, and would be seen to deny, the Department the opportunity to obtain an appropriately qualified person. It diminishes both the Department’s reputation and that of the successful candidate.
* Adequate and credible academic qualifications in the position of Director of Radiation Oncology are central to the Department’s self image, general morale, public and academic credibility and reputation, future funding and development. Removing the requirement for academic rank and university affiliation will have serious longterm consequences which will be reflected in general and patient outcomes. We deplore a decision made with neither consultation nor agreement.
* The decision compounds the problems rather than fixing them. The circumstances are not pressing in the sense required for the proper exercise of discretion to waive the need to advertise externally and in a real sense the decision discriminates unfairly against the whole of the Department.
* We believe that, rather than adopting the least suitable solution to obtaining a Director, an inquiry should be conducted, by appropriate persons, as to why our Department has been unable to recruit a suitably qualified person as Director. We realise that such an exercise will require a major effort and time however we consider University linkage and appointment to be of extreme importance to the Hospital’s public profile. We also feel strongly that any future selection process for Director include substantial and independent input from radiation oncologists.
* We wish to make it absolutely clear that our concern is purely with matters of principle and is not directed toward any individual concerned. And that the individual identities of the signatories to this document are to be held in strictest confidence.
We strongly urge you to recruit for a Chairman/Director of Radiation Oncology at the rank of full professor.”

In my view the circulation of such letter, and inviting colleagues within the Department to sign (both of which I am satisfied the applicant did) were entirely proper. The concerns expressed in that letter were genuine, reasonable, concerns. They were expressed moderately.

It is important to note that the letter preceded Dr Smee’s appointment on 5 April 1995.

The applicant’s involvement with the letter did not constitute a valid reason for the termination of her employment.

The Public Notice of 23 March 1995

The respondent relies upon the applicant’s involvement with this document as constituting a valid reason for the termination of her employment.

On 23 March 1995 a document with the heading “PUBLIC NOTICE” was distributed within the Department of Radiation Oncology. That document became Exhibit 3 in these proceedings and was as follows:

PUBLIC NOTICE

**********************************************************************
An appointment to the position of DIRECTOR OF RADIATION ONCOLOGY at the PRINCE OF WALES HOSPITAL, SYDNEY, has not yet been made.
**********************************************************************

The Prince of Wales Hospital Medical Appointments Advisory Committee made a recommendation 12.12.1994 to appoint - not to the position advertised - but to a position redefined not to require an academic record or university affiliation.

The earliest occasion on which it could have been approved by the Eastern Sydney Area Health Service Board was 8 February, 1995. Radiation Oncology Staff were lead to believe that an appointment had been made.

The matter was held back by the Eastern Sydney Area Health Service Executive to consider questions of impropriety raised by concerned staff members.

*Was it a meritorious selection?

*Did the many procedural irregularities alleged contravene Equal Employment Opportunity principles and Anti Discrimination Legislation?

*Were they so serious as to warrant a fresh recruitment process?

The Eastern Sydney Area Health Service Executive decided 10 March 1995 to recruit afresh - internally - for a Director of Radiation Oncology without university affiliation.

The Eastern Sydney Area Health Service Executive has not made this information public.
**********************************************************************
An appointment to the position of DIRECTOR OF RADIATION ONCOLOGY AT THE PRINCE OF WALES HOSPITAL, SYDNEY has not yet been made.
**********************************************************************

The applicant played, at the very least, a major role in the preparation and distribution of that document.

That said, we live in an open society, which asserts that freedom of expression, and the right to dissent, are important values. There was nothing factually inaccurate in the document. It revealed information which in my view was not confidential - and never said to be. True, it was agitation, and did, in effect, invite dissent - but there is no reason why employees should not be able to do that, particularly on matters of importance to themselves, and their colleagues.

The “Public Notice” did not go too far. Indeed, the reaction of management to it was surprisingly vehement.

The applicant’s involvment in it did not constitute a valid reason for the termination of her employment.

The allegations concerning the applicant’s poor management practices and inappropriate dealings with staff

Paragraph 3 of Exhibit 11, the part of that document which deals with this allegation, commences as follows:

“Ms Schneider and Ms Harfield claim that Ms Kardell over the past twelve months has increasingly displayed unacceptable behaviour at work confronting themselves and other radiation therapy staff at work in an intimidatory and hostile manner. Examples of this are as follows.”

There follows a series of “sub-allegations”, which I will deal with individually.

(a) Allegations concerning the applicant’s treatment of Mr Darren Carr

This allegation is set out in paragraph 3(a) of Exhibit 11. It is as follows:

“a) A statement voluntarily tendered by Mr Darren Carr, a radiation therapist, states that he is considering terminating service because of the unacceptable behaviour displayed by Ms Kardell to him over the past 16 months. In his statement Mr Carr recounts that in May 1994 he was diagnosed with a cancer, Stage 1 Ewings Sarcoma. The tumour involved his lumbar vertebrae. Prior to his diagnosis Mr Carr was experiencing severe back pain which he attributed to injury. He requested that Ms Kardell roster him to the planning area where he found the work caused less discomfort. Ms Kardell ignored his pleas and rostered him to work in the Treatment Area. After experiencing excruciating pain he again sought assistance from Ms Kardell. He reports that at this time a “most extraordinary conversation” took place with Ms Kardell. She declined the request to roster him to planning stating that she “didn’t believe men who reported severe pain were genuine as men don’t suffer from premenstrual tension”. She claimed “that women are used to suffering in silence and therefore are less likely to complain about health concerns”. She further stated “that men in general are wimps and their reports of pain or discomfort can usually be dismissed”. Ms Kardell ordered him to return to the treatment area. It was only after Mr Carr sought assistance from the Risk Management Unit at the Hospital (Occupational Health and Safety) that Ms Kardell was forced to relocate him to the more suitable area of planning.

However, that is not the end of the matter. Before departing from Dr Smee’s threatened resignation, it is important to note that he is an important person in respect of patient treatment. He is a very experienced specialist, and his lack of management skills is not reflected in his skills as a doctor. I have no doubt that he is very talented and works very hard. He is justifiably held in high esteem by his professional colleagues.

He is a professional. Despite his poor treatment of the applicant, and his direct evidence asserting that he would resign immediately, and that his “life values” would come ahead of patient care (See transcript pages 2732 and 2733) a reasonable person in his position would not act in that way. If he were to resign and walk out the door immediately, thereby having a direct and significantly adverse effect on patient care, that would be a shameful thing for him to do.

I accept, nonetheless, that there is a real possibility that, for one reason or another, he will resign. It is necessary to consider (as I do) the practical effect this will have. In my opinion, within a reasonable time, the hospital and Area Health Service will overcome the problems presented to them by Dr Smee’s resignation. His resignation would not, in my view, cause such a level of disruption as to render the reinstatement of the applicant impracticable.

The threatened resignation of Dr Lonergan

Dr Denise Lonergan also said she would resign if the applicant were reinstated. She is part-time specialist and the effect of her resignation would not, therefore, be as significant as if she were a full-time employee. Furthermore, she is also a professional. In my opinion, a reasonable person in her position would not resign in such a way as to adversely effect the standards of patient care within the department.

She would more easily be replaced than Dr Smee, and in my opinion, the effect of her resignation would short lived.

Dr Lonergan will realise, having read these reasons for judgement (which I presume she will) that the principal allegations made against the applicant were simply fabrications. She will realise that this conclusion has been reached, not on an assessment of persons as they were in the witness box and not only taking into account their demeanour - but principally on an objective analysis of the evidence. In my view, she will be driven (as I was) to the conclusion that Ms Schneider and Ms Harfield have fabricated the bulk of the allegations against the applicant.

In my opinion Dr Lonergan will also accept that, particularly in the last few months prior to the applicant’s suspension from duties on 11 August 1995, it was Dr Smee’s confrontationist management style, and the way he set about asserting his authority, which led to the breakdown in the relationship between himself and Ms Kardell.

In those circumstances, in my opinion, a fair minded person in the position of Dr Lonergan will reconsider - and she will not resign. This opinion is reinforced by the fact that there is no evidence of any breakdown, on a personal level, in the relationship between Dr Lonergan and the applicant.

The threatened resignation of Mrs Sandra Rayner

Ms Sandra Rayner gave evidence that she would resign, with notice, because she would not feel comfortable working with the applicant. (See transcript page 1564). She attributed these feelings to a letter (Exhibit 52) which she had received from the applicant’s solicitors.

That letter was dated 5 October 1995 and was one of a number similar letters sent by the applicant’s solicitors (with her knowledge and permission) on that date. Other similar letters were sent to Ms Schneider (Exhibit 51) and Ms Harfield (Exhibit 50).

All of those letters were pompous, intemperate, and confrontational. They should not have been sent.

For example, the letter to Ms Rayner referred to the letter dated 29 August 1995 (Exhibit 11) from the Area Health Service the letter which set out the allegations against the applicant. It went on to refer to the allegations attributed in that letter (Exhibit 11) to Ms Rayner saying:

“...from information in my possession, it is apparent that these allegations are not only false or inaccurate in certain material respects but call into question your motives.
The assertions made in the letter of 29 August 1995 which directly derive, inter alia, from the information that you have given the Area, are misleading and untrue and the imputations derived from them are grossly misleading and defamatory in the following respects:
1. That you were asked to ‘report’ on the activities of Ms Harfield by my client and as a result were ‘....so concerned and upset ....that (you) had to seek medical treatment.’
2. That you received medical attention and that the medical certificate that you received and which enabled you to certified unfit for work between 7 and 14 August 1995, which stated that you had ‘...severe stress and anxiety with specific phobia about returning to work’ was related to my client.”

The letter went on to make certain demands, followed by threats, as follows:

“unless I receive from you:
(a) an undertaking that you will cease making all or any of the above assertion hence forth;
(b) an undertaking that you will apologise forthwith to my client in writing by Friday, 13 October 1995 for the harm and injury to my client’s reputation and good name that may have been occasioned your misrepresentations, unequivocally; and
(c) provide evidence that you have instructed the Area that you have provided such apology to my client and that you withdrawn the representation and allegations forthwith,
my client will have no alternative but to consider commencing proceedings against you in the Supreme Court for defamation seeking damages and costs (which will not be insubstantial) without further notice to you.”

When Ms Rayner received this letter she understandably felt threatened and upset.

In fact, the letter to Ms Rayner, although it was not inaccurate, did not fully state what Exhibit 11 said were the allegations that had been made by Ms Rayner to the Area Health Service. The full text of the allegations in Exhibit 11, which were claimed to have been made by Ms Rayner was as follows:

“In an unsolicited statement a senior radiation therapist, Ms Sandra Rayner, claims Ms Kardell has often asked her to ‘report’ on the activities of Ms Harfield. Ms Rayner states that on 4 August 1995 Ms Kardell asked her via a telephone conversation to ‘keep tabs on Ms Harfield and report all she says and does’. Ms Rayner found these instructions ‘completely out of line’. Further, she considered such requests as ‘inappropriate, counterproductive and destructive’. Ms Rayner believed that Ms Kardell wanted her to ‘spy’ on Ms Harfield, which she felt was ‘detrimental to good working relationships’. Ms Rayner was so concerned and upset by Ms Kardell’s instructions that she had to seek medical attention. Ms Rayner was given a medical certificate that states she has ‘severe stress and anxiety with specific phobia about returning to work’. Accordingly, she was certified unfit for duty from the 7 to 14 August 1995.”

It can readily be seen that the allegations in Exhibit 11 went considereably beyond what was set out in the letter of 5 October 1995 to Ms Rayner.

As it turned out, Ms Rayner’s evidence fell far short of the allegations in Exhibit 11 (See above). In fact, Ms Rayner gave evidence that she could not remember having ever made the allegations that were attributed to her in Exhibit 11.

Ms Rayner struck me as a very emotional person, one who was easily upset. Indeed, she broke down in the witness box, and was clearly very nervous about giving her evidence. The cross-examination to which she was subjected was not particularly forceful, and the manner of the cross-examination was not intimidatory. The impression about her personality that I gained, from the way she gave her evidence, is supported by the evidence concerning the reasons for the need for her to take time off work.

Ms Rayner now knows that the allegations in Exhibit 11, to which the applicant’s solicitor was referring in that threatening letter dated 5 October 1995 were, on her own evidence, not accurate. She should understand that the applicant, being, in effect, a victim of those untrue allegations, allowed the letter dated 5 October 1995 to be written to her.

Ms Rayner has worked with the applicant since 1979, in a relationship which was cordial and professional (See transcript page 1570).

I assume Ms Rayner will read at least those parts of these Reasons for Judgment which relate to her. I assume that, having read them, she will understand the circumstances under which that intemperate letter of 5 October 1995 was sent to her. I assume that she will realise that the applicant was really defending herself against what are now known to be untrue allegations attributed by the Area Health Service to Ms Rayner.

In those circumstances, Ms Rayner, if she behaves reasonably, will not resign.

The threatened resignation of Ann Goonan

The only incident involving Ms Goonan was the discussion between herself and Ms Kardell in April 1995 when Dr Smee nominated Ms Goonan as an alternative representative of the senior radiation therapists to the combined staff meeting (the meeting of senior staff in the department). I have dealt with that matter above.

Ms Goonan gave evidence that, apart from that conversation, her dealings with the applicant had been both “calm and collected and.....professional”.

The reason stated by Ms Goonan for resigning if Ms Kardell were to be reinstated is that the work environment would be too stressful if Ms Kardell returned. (See pages 1473 to 1475).

There would be some stress in the working environment if the applicant were to return. But Ms Goonan should understand, in common with other persons in the department, that the principal reasons for the deterioration in the working relationships in the department in 1995 are not to be placed at the feet of the applicant. Rather, the deterioration in the working relationships can squarely be attributed to the actions of Ms Harfield, Ms Schneider, and Dr Smee.

In those circumstances, a reasonable person in the position of Ms Goonan would wait and see how things go, and not resign immediately.

In any event, if Ms Goonan were to resign, as would be the case with Ms Schneider and Ms Harfield, the hospital would be able, in my opinion, to find a replacement for her, within a reasonable time.

The applicant’s relationship with senior hospital and health service management - Dr Bearham, Mr Johnston and Mr Kilkeary

In re-examination, Dr Bearham was asked this question:

“Q.What do you say to the appropriateness of a position being created for Ms Kardell outside the Radiation Oncology Department, that is supernumerary to the hospital’s needs?
A.It’s completely impractical and I can’t conceive of such an appointment being made.
Q.Why not?
A.Because the relationship with Ms Kardell and members of the hospital senior management staff has completely broken down, such that there’s not - it’s inconceivable that any of those parties would work with each other.
Q.Who?
A.Mr Johnston, myself, Mr Kilkeary - and Mr Kilkeary no longer works for the organisation, but basically I’ve been accused of setting up an appointment for some favoured person, and I just don’t see how I could be asked or expected to work with such a person again.”

That evidence was given on 12 November 1996. On 11 November 1996, when Dr Bearham was being cross-examined, but at a time when he was asked to leave the courtroom to consider an objection, counsel for applicant abandoned the allegation that there had, in fact, been an agreement (a conspiracy) between Dr Smee, Mr Johnston and Dr Bearham to assure the appointment of Dr Smee to the position of Director. That represented a major change in the applicant’s case.

I proposed, in the absence of the witness, to inform Dr Bearham of the withdrawal of that particular allegation. However, Ms Anderson, counsel for the respondent, objected to that procedure and I did not inform Dr Bearham of the change in the applicant’s case. In hindsight, it would have been better if I had.

As a consequence of that, when Dr Bearham gave his evidence about the breakdown of the relationship between Ms Kardell and senior management, he was unaware of the fact that that particular allegation had been withdrawn.

In my opinion, his evidence was significantly coloured by his continuing belief that the applicant still maintained the allegation that he had been party to what was, in effect, a conspiracy to appoint Dr Smee.

That allegation was not pressed, and not sustained in evidence. One can well understand that Dr Bearham would feel resentment to a person who made the allegation.

But the allegation has been withdrawn. Presumably, Dr Bearham is now aware of that.

Furthermore, it is now clear that the source of the allegation was not really the applicant. Rather, it was Dr Mameghan. In effect, the applicant was merely repeating what Dr Mameghan had said to her, with the gloss that Dr Mameghan had put on the conversation he had overheard.

The respondent submits that, despite the allegation of the corrupt agreement having been withdrawn, that that was no more than a tactic of convenience, and that “even now the applicant seeks to leave the smell of corruption in the air”. The respondent refers to page 2473 of the transcript in support of that submission.

That is not correct. In fact, at that part of the transcript, (the allegation of a corrupt agreement having been withdrawn, but Dr Bearham still not being aware of that withdrawal), it was suggested to Dr Bearham that the words supposedly heard by Dr Mameghan were reasonably capable of being understood as the making of such an agreement.

In my view, that was merely the expression of a “fall-back position” by council for the applicant. In fact, in my opinion, the applicant having been informed by Dr Mameghan of what he had overheard, together with the gloss that Dr Mameghan had put on it, it was not at all unreasonable for the applicant to conclude that Dr Mameghan’s “gloss” was the fact of the matter.

She was wrong, and towards the end of the case, having heard the evidence of all the parties involved (Mr Johnston, Dr Smee and, finally, Dr Bearham) the applicant accepted that Dr Mameghan’s “gloss” was wrong. In those circumstance, she did the right thing, and instructed her counsel to withdraw the allegation. The potential for that change of tack to rebound on her, to her discredit, was clear. As it turns out, I have not taken it that way.

In my opinion, it is also significant that Dr Bearham will realise that, having read these reasons for judgement, many of the allegations made against the applicant were simply false. Furthermore, Dr Bearham will realise that breakdown in the personal relationships within the department, particularly in the last few months prior to the applicant’s suspension with pay on 11 August 1995, was principally caused by the confrontational attitude of Dr Smee, and his desire to assert his authority as Director, and the feelings of hostility towards the applicant held by Ms Schneider and Ms Harfield.

When viewed objectively, the fact that the applicant made the allegation against Dr Bearham although no doubt still a matter of genuine concern to him, loses much of its sting. A fair minded person (and Dr Bearham strikes me as a fair minded person) in Dr Bearham’s position would put this episode behind him, and seek to establish a proper working relationship once again. The same applies, in my opinion, to Mr Johnston - a person who, in my opinion, is able to take an objective and fair position.

In any event, the applicant will be working, if reinstated, in the Department of Radiation Oncology. There will only be infrequent contact between herself and the senior levels of hospital and Area Health Service management.

In all of the circumstances, in my opinion, the applicant’s relationship with Dr Bearham and Mr Johnston will not be such as to cause a serious problem with harmony in the workplace, or productivity. In other words, it would not render her reinstatement impracticable.

The order that the Court will make, taking into account all of the above matters, is that the respondent, within seven days of the date of this judgement, reinstate the applicant by reappointing her to the position in which she was employed immediately before the termination of her employment.

Orders for continuity of employment and remuneration lost

The Court will also order that the employment of the applicant is, for all purposes, deemed to have been continuous in the position in which she was employed before the termination of her employment, up to the time of her reinstatement. The Court will also order that the respondent take all such steps which may be necessary to maintain the continuity of the applicant’s employment for all purposes.

As to remuneration lost, the applicant is entitled to have her entire economic loss up to the date of these orders made good. This would involve a calculation of what, as a practical matter, the applicant would have earned if she had remained in her former position. Such factors as likely overtime and penalty rates (if they had been earned by the applicant in the past) would have to be taken into account. Her former working patterns would have to be used as the basis of the assessment of what she would have earned in the period between the termination of her employment and the making of these orders.

Furthermore, the applicant was employed under an award. Presumably, since the termination of her employment on 20 October 1995, the rate of pay which the applicant would have earned if she had remained in employment has changed. The applicant is entitled to be reimbursed, not for what she would have earned if she had remained in employment at the rate of pay she was earning at the time of the termination of her employment, but for the remuneration that she has actually lost as a result of the termination of her employment.

The applicant is entitled to be compensated for her lost remuneration - not merely her lost wages. Her lost remuneration would include any superannuation which would have been paid to her over and above such payments made by the respondent in accordance with any statutory or award obligation. (Any such statutory or award payments would have to be made by the respondent in order to comply with the order for continuity - even if they did not form part of the applicant’s remuneration package).

Any annual leave that the applicant would have accrued during the period between the termination of her employment and the making of these orders, together with accrued leave loading, would have to be paid to her - or alternatively, she would have to be given credit for such accrued annual leave loading entitlements.

The applicant received five weeks pay in lieu of notice. That payment would have to be deducted from any payment to the applicant by the respondent for remuneration lost.

The Court is not, as the evidence now stands, in a position to calculate the amount of remuneration lost by the applicant.

The practical solution would involve the applicant and the respondent reaching amicable agreement in respect of an order for remuneration lost, and filing consent orders. A timetable will be set for this process.

Interest

The applicant has applied for interest.

In so far as it is relevant, section 482 of the Act is as follows:

“(1)In proceedings for the recovery of money (including a debt or damages) in respect of a cause of action that arose after 21 November 1984, the Court or a Judge must, on application, unless good cause is shown to the contrary, either:

(a) order that there be included in a sum for which judgment is given interest at such rate as the Court or Judge thinks fit on the whole or any part of the money for the whole or any part of the period between the date when the cause of action arose and the date as of which judgment is entered; or

(b) without proceeding to calculate interest in accordance with paragraph (a), order that here be included in the sum for which judgment is given a lump sum instead of any such interest.
(2)Subsection (1) does not:

(a)     authorise the giving of interest on interest or of a sum instead of such interest; or
(b)     apply in relation to a debt on which interest is payable as of right whether because of an agreement or otherwise; or
(c)     affect the damages recoverable for the dishonour of a bill of exchange; or
(d)     limit the operation of any enactment or rule of law that, apart from this section, provides for the award of interest; or
(e)     authorise the giving of interest, or a sum instead of interest, except by consent, on a sum for which judgment is given by consent.
(3)If the sum for which judgment is given (‘the relevant sum’) includes, or the court or a Judge in its or his or her absolute discretion determines that the relevant sum includes, an amount for:
(a)     compensation in respect of liabilities incurred that do not carry interest as against the person claiming interest or claiming a sum instead of interest; or
(b)     compensation for loss or damage to be incurred or suffered after the date on which judgment is given; or
(c)     exemplary or punitive damages;

interest, or a sum instead of interest, must not be given under subsection (1) in respect of such an amount or in respect of so much of the relevant sum as in the opinion of the court or Judge represents such an amount.”

Section 482(4) is, for present purposes, not relevant.

The question arises whether an application alleging the unlawful termination of employment and seeking a remedy under section 170EE of the Act is a proceeding “for the recovery of money (including a debt or damages)”. In my opinion, in so far as an application alleging an unlawful termination of employment seeks an order for remuneration lost under section 170EE(1)(b)(ii), such an application is a “proceeding for the recovery of money (including a debt or damages)” within the meaning of section 482(1) of the Act.

It is to be noted that the words “including a debt or damages” are not expressed to be exclusive, and that there may be other types of proceedings under section 482(1) of the Act “for the recovery of money” apart from proceedings in relation to “a debt or damages”.

In my opinion, an application alleging unlawful termination of employment, and seeking an order for reinstatement and a consequential order for remuneration lost, is just such a proceeding.

Section 482(1) of the Act provides that the Court must on application, unless good cause is shown to the contrary, make an order for interest.

Although the Rules of the Industrial Relations Court of Australia did not prescribe a rate of interest, order 35 rule 8 of the Federal Court Rules prescribe 12% as the rate of interest for orders made under the section of the Federal Court Act which is analogous
to section 482 of the Workplace Relations Act.

In my opinion, 12 per cent (12%) would be an appropriate rate of interest to be used in this case.

Although the applicant is entitled to interest, it is not possible to calculate that interest until such time as an order is made (by consent or otherwise) in respect of the amount of remuneration lost. The parties will be expected to be in a position to provide assistance to the Court on the amount of interest to be ordered when this matter is relisted - as it will be, for final orders, sometime before the end of September.

ORDERS

THE COURT ORDERS AND DECLARES THAT:

The applicant be allowed to file her application by 2 December 1995.
Within seven days of today the respondent shall reinstate the applicant by reappointing her to the position in which she was employed immediately before the termination of employment.
The employment of the applicant is, for all purposes, deemed to have been continuous in the position in which she was employed immediately before the termination of her employment, up to the time of her reinstatement.
The respondent is to take such steps as may be necessary to maintain the continuity of the applicant’s employment for all purposes.
The respondent is to pay the applicant the amount of remuneration lost by the applicant as a result of the termination of her employment, in accordance with the principles set out in the reasons for judgement herein.
If an agreement is reached between the parties within fourteen days of the date of this judgement on the question of the gross amount of remuneration lost, consent orders may be filed pursuant to Order 35 Rule 10.
Within seven days of today, the applicant is to provide the respondent with copies of all documentation in her possession or control concerning any remuneration earned by her since the termination of her employment, together with the names, addresses and telephone numbers of all persons who have provided that remuneration.
Any monies paid by the respondent to the Commissioner of Taxation as taxation in respect of the monies ordered to be paid to the applicant for remuneration lost shall be deemed to have been paid in pro tanto satisfaction of the judgement debt.
Liberty to apply on seven (7) days notice.

I certify that this and the preceding 118 pages are a true copy of the reasons for decision of Judicial Registrar Patch.

Associate: J. Flores

Dated: 8 September 1997

APPEARANCES

Counsel for the applicant: R. Goot

Solicitors for the applicant: Szekely and Associates

Counsel for the respondent: T. Anderson

Solicitors for the respondent: Bartier Perry and Purcell

Dates of hearing: 1 December 1995
11 & 12 January 1996
19, 20, 21 22 & 23 February 1996
29 and 30 April 1996
1, 2, 3, 15, 16, 17, 22, 23 and 24 May 1996
12, 13, 14, 15 and 16 August 1996
5 September 1996
8, 9, 10, 11, 21, 22, 23, 24 and 25 October 1996
11, 12, 13 and 14 November 1996
9, 10 and 11 December 1996

Counsel for the applicant:	R. Goot
Solicitors for the applicant:	Szekely and Associates
Counsel for the respondent:	T. Anderson
Solicitors for the respondent:	Bartier Perry and Purcell
Dates of hearing:	1 December 1995 11 & 12 January 1996 19, 20, 21 22 & 23 February 1996 29 and 30 April 1996 1, 2, 3, 15, 16, 17, 22, 23 and 24 May 1996 12, 13, 14, 15 and 16 August 1996 5 September 1996 8, 9, 10, 11, 21, 22, 23, 24 and 25 October 1996 11, 12, 13 and 14 November 1996 9, 10 and 11 December 1996

[1997] IRCA 261

08 September 1997