Krombholz v Secretary, Department of Defence
[2016] FCA 345
•6 April 2016
FEDERAL COURT OF AUSTRALIA
Krombholz v Secretary, Department of Defence [2016] FCA 345
File number: ACD 23 of 2016 Judge: BROMWICH J Date of judgment: 6 April 2016 Catchwords: PRACTICE AND PROCEDURE – urgent application before start of a proceeding – where application brought under s 370(b) Fair Work Act 2009 (Cth) – where applicant sought prohibition on publication of separation of employment in the Public Service Gazette Legislation: Fair Work Act 2009 (Cth) ss 365, 368, 368(3)(a), 369, 370, 370(a), 370(b), 570(2)
Federal Court Rules 2011 (Cth) r 7.01(2)
Australian Public Service Commissioner’s Directions 2013 (Cth) cll 2.29, 2.30
Public Service Act 1999 (Cth) s 29(3), 29(3)(g)
Cases cited: Australian Broadcasting Corporation v O'Neill [2006] HCA 46; (2006) 227 CLR 57 Date of hearing: 5–6 April 2016 Registry: Australian Capital Territory Division: General Division National Practice Area: Employment & Industrial Relations Category: Catchwords Number of paragraphs: 49 Counsel for the Applicant: The applicant appeared in person Solicitor for the Respondent: Ms C Mann of Australian Government Solicitor ORDERS
ACD 23 of 2016 BETWEEN: MONA KROMBHOLZ
Applicant
AND: SECRETARY, DEPARTMENT OF DEFENCE
Respondent
JUDGE:
BROMWICH J
DATE OF ORDER:
6 APRIL 2016
THE COURT ORDERS THAT:
1.The respondent be named as ‘Secretary, Department of Defence’.
2.The urgent application before start of a proceeding dated 5 April 2016 be dismissed.
3.There be no order as to costs.
Note: Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
REASONS FOR JUDGMENT
This is an application brought as an “Urgent application before start of a proceeding” pursuant to r 7.01(2) of the Federal Court Rules 2011. The application is brought by Ms Mona Krombholz, who was until recently an employee of the Department of Defence.
The application itself does not refer to a respondent, but within the document is an incomplete version of a Form 79 originating application in which the respondent was described as the Department of Defence. Because the Department of Defence is not a legal entity, I directed that the respondent be named as the Secretary of the Department of Defence.
The application was supported by an affidavit of the applicant sworn 5 April 2016. The application arises from the circumstances by which the employment relationship between the applicant and the Department came to an end.
The orders sought in the application are as follows:
1.Prohibition on any communication or publication of separation of employment with Defence including the Commonwealth Gazette.
2.Preservation of all documents held by Applicant, that at the time of the Applicant’s employment, was authorised to use, collect, receive or provide to Defence investigators, line managers, Fair Work Commission, Australian Federal Police and the Australian Public Service Commission, for the purpose of proceedings for employment matters, or to assist government agencies with official enquiries or investigations arising from the reporting of public interest disclosures and matters of public interest.
3.Either:
a.To bypass the Fair Work Commission to obtain a certificate, and submit a Form 79 application to commence proceedings directly in the Federal Court within 14 days after this application has been determined in accordance with Section 370(b) of the Fair Work Act; or in the alternative,
b.direct that an application is made to the Fair Work Commission, and the 14-day undertaking commences from the date that the Fair Work Certificate is issued.
4.Request fees payable based on Form 79 application fees per section 370(b) of the Fair Work Act 2009 to seek interim injunction.
Note: Request order (with respect to Item 1) by Wednesday (before noon) on 6 April 2016 due to Commonwealth publication deadlines.
The affidavit of the applicant details an employment relationship between the applicant and the Department which commenced on 19 January 2012 when she started as an Assistant Director (Executive Level 1) in the Defence Procurement and Contracting Branch in the Australia Capital Territory. The affidavit then details various subsequent positions occupied by the applicant.
The application made on 5 April 2016 and heard both that day and on 6 April 2016 arose from a process that took place following allegations and findings of a breach of the Australian Public Service (APS) Code of Conduct. On 16 March 2016, the applicant was issued with a document entitled “Intention to Sanction – Termination of Employment” (Intention to Sanction), addressed to her as Assistant Director of Defence Support Operations, which I also understand to have been at the Executive Level 1 in the APS. That document was signed by Lisa Phelps, Acting Assistant Secretary, HR Services, in the Defence People Group.
The Intention to Sanction indicated at [6] that the reasons for a proposed sanction was a prior finding that “on three occasions [the applicant had] failed to comply with lawful and reasonable directions to attend at a medical assessment”. The applicant disputes the finding that the directions were “lawful and reasonable”. Rather, as the applicant indicated in a part of a primary review application to the Australian Public Service Commission dated 17 March 2016, she maintains that while “Defence personnel [had] issued multiple directions to attend fitness for duty assessments”:
(1)the “reason for the medical assessments [did] not meet the requirements for directing an APS employee to attend a medical assessment under Public Service Regulations 3.2”;
(2)“personnel issuing directions did not hold the delegated authority”;
(3)“decisions [had] been made in bad faith”; and
(4)“decisions [had] been made as a reprisal for raising complaints and disclosures”.
It therefore appears that there is no dispute that the applicant did not, in fact, participate in three medical assessments as directed, but rather took issue with the lawfulness or reasonableness of those directions being issued. The Intention to Sanction relied upon a prior determination of breaches of the Code of Conduct in failing to comply with those directions. There was a tentative conclusion in the Intention to Sanction at [20] that termination of employment was the appropriate sanction to apply in that case.
At [21] and [22] of the Intention to Sanction, Ms Phelps invited comments before a final determination was made, and indicated at [24] that any such comments were to be made within 7 days – that is by no later than 24 March 2016.
In the course of the ex parte hearing yesterday, the applicant indicated that she had not responded to the invitation to provide a comment in response to the Intention to Sanction because she regarded the outcome as a foregone conclusion, and that accordingly there was no point in doing so. In any event, what actually transpired is that on 24 March 2016, the deadline for the response to the Intention to Sanction, the applicant instead did two things:
(1)she filed an application with the Fair Work Commission through its online system, and, at 4.27 pm on that day, emailed that application with attachments to a Mr John Geering at the Department;
(2)a relatively short time later at 5.04 pm she emailed to Mr Geering a letter of resignation in which she said that she was giving six weeks’ notice (which she advised the Court was the notice period within the Department’s enterprise agreement).
On 29 March 2016, Ms Phelps emailed the applicant. In that email Ms Phelps said that she had received notice that morning that the applicant had submitted her resignation to Mr Geering on 24 March 2016. Ms Phelps said that before she received news of the applicant’s resignation she had made a decision to terminate the applicant’s employment with the Department of Defence on the ground that she had breached the Code of Conduct. Ms Phelps said that she made that decision not having received a response to the Intention to Sanction. She said that she had determined that the proper course was to proceed with the termination for employment. The email attached the reasons for that decision, also dated 29 March 2016.
On 30 March 2016, a minute was sent by Ms Julie Holder, a senior investigator in the Directorate of Conduct and Performance in the Defence People Group to “PAC Melbourne”, which I understand to be the departmental pay team that dealt with separation payments for anyone leaving employment with the Department. Paragraph 4 of that document said:
Can you please ensure that this termination is notified in the Commonwealth Gazette as required by Part 2.4, clause 2.29(1)(i) of the Australian Public Service Commissioner’s Directions 2013. The termination is to be recorded as being made under section 29(3)(g) of the Public Service Act 1999 as noted above.
It is evident that this minute, which was provided to the applicant the next day, 1 April 2016, was the trigger for the application that is now before the Court. The applicant is concerned that the termination of her employment will be published in the Public Service Gazette (the Gazette) before any outcome is reached as to her challenge both to that termination and to what she may well advance as being a constructive dismissal, such that her letter of resignation is not legally efficacious either.
I initially heard from the applicant ex parte yesterday, during which she outlined her case, and, in particular, the components that I have referred to above from the Intention to Sanction, and what flowed from that. I referred earlier to an application being made to the Fair Work Commission, but I should indicate that whilst the email forwarding that application was included within the papers, the application itself was not. I infer that the application was a challenge in the Fair Work Commission in some respect concerning her employment dispute with the Department.
The reason why the application is brought to this Court is that, as the applicant points out, the Fair Work Commission does not have an injunction power. The problem with bringing an application in this Court is that the starting point under the Fair Work Act 2009 (Cth), which is the legislation which the applicant would seek to rely upon, particularly in relation to what I understand she will be saying is adverse action, requires that such applications ordinarily first be brought in the Fair Work Commission. It is only if a bona fide attempt at mediation or conciliation is unsuccessful that the Fair Work Commission can certify that process has taken place and the matter can then be the subject of proceedings in this Court.
Section 370 of the Fair Work Act provides that a person who is entitled to apply under s 365 for the Fair Work Commission to deal with the dispute must not make a general protections court application in relation to the dispute unless either s 370(a) or (b) apply.
Section 370(a) requires both the issuing of a certificate under s 368(3)(a) and an application to this Court being made within 14 days after the certificate has issued (or such further period as the Court allows either during or after those 14 days). It is apparent that this was not going to be a mechanism that was available to bring an application in this Court because an application had only been filed with the Fair Work Commission on 24 March 2016, even if that application canvassed these matters in any event. Certainly there was no time for any certificate to be issued by the Fair Work Commission because there was insufficient time for any mediation or conciliation to take place.
Accordingly, the applicant told the Court that she relied on s 370(b) of the Fair Work Act, which allows a general protections court application to be made if it includes an application for an interim injunction. That appears to be the mechanism by which this application has been made.
As indicated above, I heard from the applicant yesterday, but determined that it was not appropriate to proceed to a decision ex parte. Accordingly I directed that by 6.00 pm yesterday the application and supporting affidavit be served on the Department to give the respondent an opportunity to appear this morning and be heard.
When the matter was called on for further hearing on 6 April 2016, Ms Mann from the Office of the Australian Government Solicitor appeared for the respondent and opposed the grant of most of the relief sought in the application. One important point to note is that, as indicated above, the applicant seeks ultimately to overturn both the termination and the effect of her resignation so that she can be reinstated as a member of the APS, but not as an employee of the Department. I am not altogether sure how one can be achieved without the other, but that is the outcome she seeks.
Proposed order 1 sought in the application seeks to prevent the processes dictated by delegated legislation, being the Australian Public Service Commissioner’s Directions 2013 (Cth) (the Directions), taking place, whereby publication in the Gazette is required of APS employment decisions, including terminations. Part 2.4, cl 2.29 of the Directions provides that:
(1)An Agency Head must notify an employment decision of any of the following kinds in the Public Service Gazette within 3 months after the decision is made:
…
(i)the termination and the grounds for termination, of the employment of an ongoing APS employee under section 29 of the Act [being the Public Service Act 1999].
Section 29(3) of the Public Service Act 1999 (Cth) provides that for ongoing APS employees, the only grounds for termination are those listed in s 29(3)(a) – (h). One of those grounds, in s 29(3)(g), is a breach of the Code of Conduct.
The second part of proposed order 1 sought in the application is a prohibition of any other form of communication by anybody, presumably in the Department, about the applicant’s separation of employment. In my view, such relief would be far too wide and too general. I would not be prepared to grant such sweeping relief, especially in the circumstances of this case. Accordingly, I treated proposed order 1 of the orders sought in the application as being read down in relation only to whether or not there should be a suppression of publication of the applicant’s termination in the Gazette.
On 6 April 2016, when I asked the applicant to speak in support of the application she had made with the respondent being represented, she referred to various provisions of the Fair Work Act and to the Federal Court Rules to explain how and why the matter came to be in this Court, the key aspects of which I have set out already above. She agreed that the first order she was seeking was the total suppression of the publication by the Department of her termination until her claim, whether brought in the Fair Work Commission or in this Court, could be heard and determined. She said that were that not to happen the further publication – I gather especially in the Gazette – would cause her more damage, that such damage would be irreversible, and that even if the termination was overturned the damage would be essentially irreparable.
Ms Mann for the respondent identified the three issues that the Court needed to consider in the granting of injunctive relief, which I also note were identified in [5] of the applicant’s affidavit. They are whether or not there was a serious question to be tried, whether damages would be a sufficient remedy and the balance of convenience (see Australian Broadcasting Corporation v O'Neill [2006] HCA 46; (2006) 227 CLR 57 at 68 [19]).
In relation to proposed order 1, which is the central relief sought, being in effect suppression orders by way of injunction, Ms Mann said that the applicant had not established any prima facie case because none of the documents before the Court gave a clear statement of claim or other identification as to which sections of the Fair Work Act were being relied upon. Ms Mann said that it was not clear what the actual adverse action being relied upon was, although it seemed that the finding of Code of Conduct breaches was being alleged to be itself adverse action.
Ms Mann said that damages would be a sufficient remedy. If there was a publication, the damage to reputation could be adequately met by damages. Ms Mann also pointed out that cl 2.30 of the Directions had a corresponding requirement for any cancellation also to be notified in the Gazette as well, which I would understand to include any overturning of the applicant’s termination.
In terms of the balance of convenience, Ms Mann said that that was not met in favour of granting an injunction, particularly, as I understood it, as cl 2.29 was an ordinary law that applied to anybody in a like position where they had been terminated from an employment position in the APS.
Ms Mann also commented on the second aspect of proposed order 1, which I have already addressed, in relation to the broader relief sought going beyond preventing gazettal of the applicant’s termination. Ms Mann pointed out that it was unclear who the applicant wanted to be prohibited from making any communication, and that there might be any manner of needs for making such a communication (such as dealing within the Department with details of terminations and staffing, how many staff were at the Department, or any other such matters). Ms Mann said there was no compelling reason for granting such broad orders. As I have already indicated, I was independently of that view.
Ms Mann said that proposed order 2 was not appropriate. Proposed order 2 seemed to seek a direction to the applicant not to do anything with the documents from the Department that she already possesses. However, it was clarified during the course of the hearing of the application that what the applicant was mainly concerned with was being required to destroy or otherwise not retain documents that she needed for her pending or future application in either the Fair Work Commission or in this Court.
I asked the applicant whether or not such documents that she had retained as were required for her action would be something that she would be lawfully able to retain (referring to the “Declaration of Secrecy on Cessation of Duties” form the Department required her to sign as part of its ordinary separation procedures, reproduced in the applicant’s affidavit). She agreed but indicated that she was not sure that the Department would take that view. I indicated that I was not prepared to give an order in relation to such a matter on the basis of a speculation that the Department might not allow its documents that were relevant to her application to be kept for that purpose. Until such time as it is clear that there is in fact such a problem, I consider it premature for such an order to be made.
Ms Mann said proposed order 3 was also not appropriate and not within power. That part of the application seeks an order to bypass the requirement in s 370(a) of the Fair Work Act to obtain a certificate from the Fair Work Commission pursuant to s 368(3)(a) before commencing proceedings in this Court. In my view, Ms Mann is correct to say that this is not a power that this Court has (at least ordinarily). The requirements in s 370(a) in relation to a certificate is a matter for the Fair Work Commission unless there is some issue of the Fair Work Commission refusing to do what it is lawfully required to do, possibly giving rise to mandamus. That point has not been reached, and I seriously doubt that it would ever be. Accordingly, that relief is not appropriate.
Ms Mann said that there was no stance taken by the respondent in respect of proposed order 4, which was to do with the fees payable on the filing of the application. The applicant indicated yesterday that she had paid a filing fee of $2,300. In my view, it is not generally appropriate for a judge of this Court to get into a debate or make any orders in respect of court filing fees payable, and that is a matter that needs to be taken up with the Registry. It may well be that nothing can be done about that.
I return, then, to what remains, which is the part of proposed order 1 which seeks to prohibit publication of the applicant’s termination in the Gazette. The applicant responded to Ms Mann’s submissions by directing attention to two different documents amongst the annexures to her affidavit.
The first document appears to be part of a Form F10 filed by the applicant in the Fair Work Commission, being an application for that Commission to deal with a dispute in accordance with a dispute settlement procedure. The document sets out the applicant’s position in respect of the medical certificate issue which underpinned the finding of breaches of the Code of Conduct and ultimately the termination. The document contains various assertions written by the applicant about the legality or otherwise of the process that was adopted, but does not contain anything by which I am able to assess the merits or strengths of her assertions. It simply does not enable me to conclude that she has any arguable case for overturning the finding that she had failed to comply with directions that were lawful.
The second document that the applicant referred to is also a document written by the applicant, addressed to the Fair Work Commission, dated 24 March 2016 and apparently submitted by the applicant on that day. It refers to a public interest disclosure issue and to a Mr Grzeskowiak’s knowledge about that public interest disclosure. Again, although that document would appear to go to what is alleged by the applicant to be the real reason why Code of Conduct breaches were alleged and found by the Department to have been established, it does not, of itself, make it clear to me that there is any foundation for overturning the finding of the breaches of the Code of Conduct upon which the termination was based.
In relation to damages not being a sufficient remedy, the applicant said that publication in the Gazette will cause her more damage and that this damage to her reputation is irreversible, even if her termination is overturned. She said that money was not enough because these were matters of professional and personal reputation and that no amount of money would suffice. I note that the law of defamation reflects the fact that such reputational matters can be dealt with by way of damages, even if a person adversely affected may not feel they are sufficient compensation.
The termination is for breaches of the Code of Conduct concerning attendance as directed at fitness for work assessments. If by any means it is found by the Fair Work Commission, or if the matter ends up in this Court, by a Judge of this Court, that there was no breach of the Code of Conduct, then the entire basis for the termination may fall away and the termination may not be valid.
It is hard to see how there is any real or lasting reputational harm if the basis for a termination is overturned and it is found that there were, in fact, no breaches of the Code of Conduct. To the contrary, if the applicant succeeds, it may be that the Department’s reputation for dealing with such things properly may suffer some damage as the applicant’s complaints will, to that extent, be vindicated. In any event, in my view the risk of this limited form of reputational damage is not sufficient to warrant a grant of an injunction against the ordinary processes applying to termination of employment in the APS being followed.
As to the balance of convenience, the applicant addressed the arguments or merits of her case rather than really addressing why the ordinary processes applying to anybody who has been terminated, namely, publication in the Gazette, should not take place. In the end, the balance of convenience aspect was not truly grappled with by the applicant.
As none of the four proposed orders can be granted, the application must be dismissed.
As the application does not contain anything of substance beyond the seeking of an injunction, the entirety of the proceedings in this Court are at an end by the dismissal of the application. The ordinary process contemplated by s 370 of the Fair Work Act, having particular regard to the terms of ss 365 and 368 (and perhaps s 369), mean that the appropriate place for at least starting any substantive application for relief by the applicant is in the Fair Work Commission, at least to the point of a bona fide mediation or conciliation process. It may be that the application filed in the Fair Work Commission by the applicant on 24 March 2016 is either of that character, or can be modified to raise the issues ventilated in this Court. It is only after the processes in the Fair Work Commission have been exhausted that the matter can properly be brought in this Court.
I turn to the question of costs. A question arises as to whether or not this application is legitimately or properly brought having regard to the limitations contained in s 370(b) of the Fair Work Act. In my view, to say that the application was not legitimately or properly brought would be to take an excessively technical view of this case and one that is not necessary in all the circumstances. It is the case that the applicant did not have a remedy by way of injunction that she was seeking other than by coming to this Court. Accordingly, I am prepared to treat the application for injunctive and related relief as one having been brought in accordance with s 370(b).
During the course of the hearing, Ms Mann indicated that the respondent sought to have costs reserved so that consideration could be given to applying for costs at a later date. Consideration of that application requires an assessment of whether such an application for costs is likely to succeed.
Section 570 of the Fair Work Act provides that costs may only be awarded in accordance with subsection (2) or certain other sections that do not apply to this case. Section 570(2) provides that a party may be ordered to pay costs only if one of three circumstances is present. The first circumstance, set out in s 570(2)(a), is that the Court is satisfied that the unsuccessful party instituted the proceedings vexatiously or without reasonable cause. While the applicant has failed in her application, I accept that she genuinely is concerned about the publication of her termination in the Gazette. I therefore do not consider that the key aspect of the application was vexatious or without reasonable cause, even though it failed.
Section 570(2)(b) provides that costs may be awarded if the Court is satisfied that the party’s unreasonable act or omission caused the other party to incur costs. I note in that regard that the applicant did, in an email sent to Mr Geering on 1 April 2016, ask the Department that the Gazette publication not take place pending the resolution of her application to the Fair Work Commission, and therefore the Department was on notice of her concerns. The Department did not indicate, as it could have, that no publication would take place until some later point within the three-month period within which publication is required. The application was brought ex parte and was only served on the legal representatives for the respondent at my direction, as I thought it appropriate that I should hear from a representative of the respondent. This was considerably more cost-effective than, for example, granting a short interim injunction, and dealing with its continuance on a future date, perhaps with the additional cost of counsel. Therefore in my view there was no unreasonable act or omission causing the respondent to incur costs.
The third basis for costs in s 570(2)(c) is that the Court is satisfied that the party unreasonably refused to participate in a matter before the Fair Work Commission and the matter arose from the same facts as the proceedings. Neither of those circumstances arise.
I am therefore of the view that the respondent would have poor prospects of making a successful application for costs. In those circumstances, delaying the finalisation of this matter by reserving the question of costs is not appropriate.
The orders of the Court are that the application filed on 5 April 2016 be dismissed and that there be no order as to costs.
I certify that the preceding forty-nine (49) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Bromwich. Associate:
Dated: 8 April 2016
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