Marco Faccin v Santos WA Energy Ltd
[2023] FWC 975
•13 JUNE 2023
| [2023] FWC 975 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Marco Faccin
v
Santos WA Energy Ltd
(U2023/762)
| DEPUTY PRESIDENT BEAUMONT | PERTH, 13 JUNE 2023 |
Application for an unfair dismissal remedy
Merits of the application and outcome
This decision concerns an unfair dismissal application made by Mr Marco Faccin (the Applicant) under s 394 of the Fair Work Act 2009 (Cth) (the Act). Santos WA Energy Ltd (the Respondent) dismissed the Applicant after he sent a text message to a contractor that read:
Are you seriously considering going to VI during protected action. Support the boys and take a sickie. (the Text Message)[1]
Whilst the Applicant’s conduct constituted a valid reason for dismissal and he was afforded procedural fairness, I have nevertheless concluded he was unfairly dismissed on the basis that the dismissal is harsh. The Applicant had worked for the Respondent and its predecessors for near on twenty years and the evidence did not suggest that the Applicant’s performance had ever been an issue or that he had previously engaged in misconduct. Having considered the gravity of the misconduct and the mitigating circumstances of the Applicant, I concluded that the disciplinary action afforded was disproportionate.
Whilst I considered that an award of compensation was appropriate, I discounted the amount on the basis of the Applicant’s misconduct and limited evidence to show that he had mitigated his loss. Compensation in the amount of $65,561.49 is awarded subject to any applicable taxation. An Order[2] issues concurrently with my decision. My detailed reasons follow.
Background and factual findings
The Respondent called two witnesses to give evidence. The first, Nathan Vitanza, is the Production Manager – WA Gas Assets (Vitanza). The second, Brenton Craig Hawtin, is the General Manager of Operational Services – Santos Energy Solutions (Hawtin). The Applicant relied upon his own evidence in support of his case.
The Applicant worked for the Respondent on Varanus Island (VI or Island) in the position of General Service Operator Lead (GSO Lead).[3] The Respondent operates a gas processing hub on the Island, and the Applicant provided essential support services such as loading and unloading of marine vessels, provision of scaffolding and rigging, painting, carpentry, general handy work, and general machine and plant maintenance (oil, water, tyres etc.) for production and maintenance operations. The ‘Lead’ aspect of the Applicant’s role required him to be across the skills and competencies of his team, plan lifts and assist to verify competency (VOC).[4]
From September 2020 until January 2023, various VI employees, including the GSO Leads, were engaged in enterprise bargaining to replace the Quadrant Energy Australia Limited Varanus Island Hub Enterprise Agreement 2017 – 2020 (Quadrant Energy EA)[5] with the proposed Santos WA Energy Limited Varanus Island Hub Enterprise Agreement 2022 (Santos EA).[6]
Vitanza states that during the protect industrial action (PIA) campaign he was keen to ensure employees were reminded of the Respondent’s expected standards of conduct.[7] He sent out a VI Industrial Action FAQ (FAQ) to employees which set out behavioural expectations for employees during the PIA. It provided:
It is up to each Eligible Employee to decide if they take protected industrial action or not,
regardless of the outcome of the vote.An Eligible Employee has the right to choose whether they would like to participate in some, all or one of the protected industrial action whether or not they voted yes or no, or did not vote at all.
No person can threaten, intimidate or coerce an Eligible Employee to take or not take protected industrial action.
…
Any form of intimidation or pressure on any employee who chooses not to support the choices of Eligible Employees or does not support the protected industrial action is inappropriate, may be unlawful, and may result in disciplinary action being taken.
…
However, during any periods of industrial action, protected or unprotected, Santos expects employees to comply with its Values and Code of Conduct which includes not using inappropriate, offensive, humiliating or intimidating language, not engaging in bullying or harassment, and not disclosing sensitive or confidential information. [8]
While the Applicant does not recall having received the FAQ, he concedes, appropriately in my view, that if the FAQ was sent out to the Island he should have received it.[9]
The Respondent otherwise sets out its workplace behaviour expectations in its Code of Conduct (Code) and Equal Opportunity Policy (EOP). The Applicant completed training on the Code on 3 December 2019 and 27 July 2021.
Section 2 of the Code states: ‘Our workplace is free from harassment, discrimination and bullying’.[10] The Code also states that it is supplemented by, amongst other things, other policies that ‘set out in more detail the standards Santos Workers are expected to meet’.[11] The EOP is such a policy, section 1.1 of which provides ‘Santos does not accept and will not condone Unlawful Behaviour, which may include Harassment, Discrimination or Bullying undertaken by or towards Santos Workers in any circumstances.’[12]
The EOP provides a definition of ‘Harassment’ as follows:
[Harassment] means any unwanted, unwelcome and uninvited behaviour that results in a person feeling humiliated, intimidated or offended, and under the circumstances it would be reasonable for them to feel this way. The perception by an individual that they have been harassed is sufficient for them to lodge a complaint. Harassment may be unlawful, even if there was no intent to harm another person. Examples include unwelcome practical jokes; the use of unsuitable language in the workplace; spreading gossip or rumours; or the reciting of racist jokes.[13]
The Applicant’s contract of employment of 27 October 2016, set out on Quadrant Energy letterhead, provides at clause 22 that the Applicant agreed ‘to comply with all Company policies and procedures as…in the Agreement’. The ‘Agreement’ referred to in the employment contract was referred to as the Apache Energy Limited EBA (Agreement). Whilst the employment contract notes that the Agreement was attached, it was not included in the evidence. Presumedly, given the date of the Applicant’s employment contract, the Agreement was the Apache Energy Ltd Varanus Island Hub Enterprise Agreement 2013-2017,[14] which at clause 20 referred to an equal opportunity policy and precluded harassment, and at clause 8.1 required compliance with all lawful requirements in relation to the Company’s rules, regulations, policies, practices, and procedures as amended from time to time. However, the evidence before me was that bargaining on foot between September 2020 and January 2023 was to replace the Quadrant Energy EA. The Quadrant Energy EA at clause 8 provided:
Employees are required to comply with all lawful requirements by the Company in relation to the Company's rules, regulations, policies, practices and procedures as amended from time to time…
As it was, the Applicant accepted that harassment was prohibited by the Code and the EOP and that an employee is not permitted to harass an employee or contractor.[15]
During a period of PIA taken by some of the Respondent’s employees in support of the Santos EA, a third party contractor, Darren Edmunds (Edmunds), was scheduled to travel to VI on 16 September 2022 for the purpose of conducting VOCs. The night before he was due to fly to the Island, he received the Text Message from a number unknown to him.[16]
In response to receiving the Text Message, Edmunds notified his manager, Donovan Black (Black) of Stag Consulting. Black notified the Respondent of the Text Message. Vitanza said that on 16 September 2022, a Maintenance Team Leader at VI sent him a copy of an email from Black.[17] The email from Black was addressed to multiple recipients with UGL Limited email addresses in addition to ‘[email protected]’, with Edmunds copied in. It stated:
I need to inform you that I have received a phone call from Darren about being harassed prior to going to site at about 9:30 pm on Thursday night and he has been sent copies of Santos internal email, originally coming from a Santos about a concern with 3rd party assessments being conducted on site.
First, Darren has never done any VOCs for me at Varanus Island so this should have nothing to do with any STAG consulting trainer and secondly, it’s highly inappropriate for Santos or other employee’s to personally harass my trainer prior the night before his flight by phone, email, or text messages and told he should not attend when I am his point of call. I should also personally not be witness to Santos internal email messages sent through screen shot text messages from random persons sent to my trainer and then to myself about Santos internal issues.
I can say that this seems very unprofessional from whoever is driving this and that I have some real concerns that personal and professional boundaries are being controlled in this type of action towards my contracted staff who is just trying to perform a job asked of him by myself on short notice.[18]
On receipt of the complaint, Santos engaged Allens Business Investigations (part of the law firm ‘Allens’) to conduct an investigation.[19] The investigator, Corey Courtemanche (Courtemanche), interviewed Edmunds on 15 October 2022, the Applicant on 8 November 2022 and ‘Witness A’, the Offshore Installation Manager (OIM), on 1 November 2022.[20] Further, Courtemanche considered a written response of the Applicant.[21]
The allegations set out in a letter to the Applicant of 4 November 2022 were as follows:
Allegation 1
You sent a text message from mobile number +61420448282 at 8:14pm WAST on 15 September 2022 to a contractor engaged to conduct VOC assessments of Crane Operators at Varanus Island that read "ARE YOU SERIOUSLY CONSIDERING GOING TO 'VI' DURING PROTECTED ACTION. Support the boys and take a sickie".Allegation 2
The 15 September 2022 text message was unwanted, unwelcome and uninvited behaviour that
resulted in a person feeling humiliated, intimidated or offended in breach of the Santos Equal
Opportunity Procedure, specifically in relation to 'Harassment'.Allegation 3
The 15 September 2022 text message was disrespectful and harassing in nature, and in breach of the Santos Code of Conduct Section 2, 'Our workplace is free from harassment, discrimination and bullying'.[22]
Based on the evidence before me, I have found that the Applicant sent the Text Message to Edmunds. For his part, the Applicant states that on Wednesday, 15 September 2022, he sent a text message from his mobile phone to ‘Edo’ (Edmunds). The Applicant says that he cannot recall the exact words of the message he sent him as the message has been deleted. However, the Applicant says that in his SMS he informed ‘Edo’ of the PIA and asked him to support the ‘EBA members’ as they engaged in PIA.[23] The Applicant notes that his phone number was never hidden or blocked, and it was not his intent to intimidate or offend Edmunds.[24] The Applicant further concedes that he had established that it was Edmunds who was coming to VI after checking the Island’s E Diary on his computer, which lists the outgoing and incoming passengers.[25] The Applicant had previously worked with Edmunds in or around 2004.[26]
I have, in addition, found that the Applicant’s conduct of sending the Text Message to Edmunds prior to Edmunds coming to VI the next day, was unwelcomed and uninvited behaviour that resulted in Edmunds feeling intimidated.
Edmunds reported to Courtemanche during the course of the investigation that he was 'absolutely' of the view the Text Message ‘was intentionally intimidating to stop him from attending [VI] the following day’.[27] The evidence also shows that in response to receiving the Text Message, Edmunds notified his supervisor and did not present for work at VI.[28] The Investigation Report prepared by Allens Business Investigations detailed notes from an interview from Edmunds.[29] Edmunds informed Courtemanche to the effect that on receipt of the Text Message:
…he was annoyed and upset that he had been contacted in that he had been contacted in that manner, and he felt the situation was 'really getting out of hand' and he was no longer comfortable travelling to Varanus Island. The Reporter stated he was disturbed, annoyed and frustrated by the message. He stated that as a contractor, it was a tough year and financially he needed to attend the job, although he just did not feel comfortable to go after receiving that message. The Reporter stated 'the decision didn’t come lightly to be honest and I had a long chat with my partner about it and it's, it just felt like it was so inappropriate…'.
The Reporter stated that he had just that day completed his Santos online Code of Conduct, Bullying and Harassment training and this was still fresh in his mind. He stated 'these guys have really stepped over the line here' and that he felt 'used and abused'.
The Reporter stated that he was 'absolutely' of the view the message was intentionally intimidating to stop him from attending Varanus Island the following day. As such, he contacted his manager Donavan Black from Stag Consulting and advised he would not be attending work the next day, and the matter was reported further to UGL and Santos.[30]
By way of context, prior to receiving the Text Message, Edmunds had purportedly received a phone call at 6:00 PM on 15 September 2022 from a personal acquaintance who had informed Edmunds that they had been encouraged to contact him and let him know the situation at VI regarding the PIA.[31] Edmunds reported that at that time it was his intention to still go to VI. That same acquaintance thereafter sent him a text message of a screen shot of an email dated 15 September 2022, written by the Applicant, raising concerns about third party VOCs. Edmunds again informed Courtemanche that at that point he still intended to attend VI the next day.
The circumstances in the evidence before me give rise to a reasonable and definite inference that Edmunds was intimidated by the receipt of the Text Message. It is evident from the Investigation Report and previously cited evidence that Edmunds reported the Text Message, and its receipt was fundamental to Edmunds’ decision not to present for work the next day notwithstanding his report that he needed to attend the job for financial reasons. In drawing such inference, I have considered and adopted the principles in respect of the drawing of inferences from evidence, as set out by a Full Bench of the Australian Industrial Relations Commission in Smith v Moore Paragon Australia Ltd[32] and the Full Bench of Fair Work Australia in DesignInc (Sydney) Pty Ltd v Xu.[33]
However, the question that arises was whether it was reasonable for Edmunds to feel this way. Under the circumstances, I have found that it would have been reasonable for Edmunds to have considered the Text Message uninvited, unwelcome and intimidating, hence feeling the way he did.
Edmunds received the Text Message at approximately 8:00 PM the night prior to flying to VI the next day on 16 September 2022. It was from a mobile phone number he was unfamiliar with. Further, even if he had been familiar with the mobile phone number of the Applicant, the evidence does not show that Edmunds and the Applicant had a relationship such that the Text Message constituted, on an objective level, acceptable communication between the two of them. To the contrary, the Text Message failed to include any form of salutation and effectively questioned Edmunds’ decision to work at VI, hence the use of the phrase, ‘[a]re you seriously considering going to VI during protected action’ (italics for emphasis).
The investigation substantiated three allegations against the Applicant. The evidence presented at hearing supports such findings, which were:
a) the Applicant was the author of the Text Message and sent the Text Message to Edmunds on 15 September 2022;
b) the Text Message was unwanted, unwelcome, and uninvited behaviour that resulted in a person feeling humiliated, intimidated, or offended in breach of the EOP, specifically in relation to harassment; and
c) the Text Message was disrespectful and harassing in nature, and in breach of section 2 of the Code.
In respect of finding (c) in the preceding paragraph, the Applicant’s Text Message to Edmunds demonstrated a lack of respect toward him. It showed a complete disregard for Edward’s private time, contact having been made at 8:00 PM prior to a flight to VI the next day. Further, the circumstances were such that the communication was neither invited nor welcome, given there was not a level of familiarity between the two that would render the sending of the Text Message at that time, and its content, acceptable.
Before considering whether there was a valid reason for the Applicant’s dismissal, it is relevant to observe that there is no jurisdictional barrier to this unfair dismissal application being considered and determined by the Commission. It is not in contest, and I am satisfied on the evidence before me, that the Applicant was dismissed, he had made his application in time, he was a person protected from unfair dismissal, the Respondent was not a small business employer, and the case was not one of genuine redundancy.
Valid reason
In considering whether a dismissal is unfair, the Commission must consider the matters specified in s 387, including whether there was a valid reason for dismissal and any other matters the Commission considers relevant. Section 387 of the Act contemplates that an overall assessment as to the nature of the dismissal will be undertaken and in so doing, the criteria in s 387 must, where relevant, be weighed up in totality.
In respect of whether there was a valid reason for the Applicant’s dismissal, by virtue of the findings reached at paragraphs [22] and [26], I consider that there was. ‘Valid’ in this context generally refers to whether there was a sound, defensible or well-founded reason for the dismissal.[34] Such a reason is one that is valid in the sense that it was both sound and substantiated.
A failure to comply with a lawful and reasonable policy is a breach of the fundamental term of the contract of employment that obliges employees to comply with the lawful and reasonable directions of the employer. In this way, a substantial and wilful breach of a policy will often, if not usually, constitute a ‘valid reason’ for dismissal.[35]
It is uncontroversial that on 15 September 2022 the Applicant established that Edmunds was to be on an inbound flight to the Island the next day. The Applicant conceded that on the afternoon of 15 September 2022 he checked the ‘Island E Diary’ on his computer,[36] and saw that Edmunds was incoming for Friday, 16 September 2022.[37] The Applicant said that he telephoned Scott Windram (Windram) and enquired to confirm if Edmunds was coming to verify the competencies of his two colleagues on the Island’s cranes.[38] It is noted that that GSO Leads report to the Maintenance Supervisor, who in turn reports to two alternating OIMs. At the relevant time last year, the OIMs were Windram and Brad Kelly.[39]
The Applicant said that Windram confirmed that this was correct.[40] The Applicant said he emphasised to Windram that his colleagues were not ready, to which, said the Applicant, Windram stated to the effect ‘that’s the way it’s going to be’.[41]
The Applicant explained that he and Edmunds had been employed by Apache Energy in 2004 as GSOs and had worked together for several years.[42] Because the relationship was ‘normal’, the Applicant said that he felt he could reach out to Edmunds to support the workforce in its ‘EBA’, which was being negotiated whilst at the time PIA was ongoing.[43] The Applicant said that on Wednesday, 15 September 2022, he sent a text message from his mobile to Edmunds to the effect of asking him to support ‘us EBA members’ as they engaged in PIA.[44]
I am unconvinced by the Applicant’s characterisation of his communication with Edmunds. Whilst not suggesting that the Applicant somehow finagled access to the Island E Dairy, the Applicant did use the information on the Island E Diary for a purpose clearly not contemplated or authorised by the Respondent. While the Applicant gave evidence that he did not send the Text Message to intimidate Edmunds and that there was nothing wrong (presumedly with the Text Message), otherwise he would not have sent it,[45] that it is not the conclusion I have reached.
It is plain that the aim of that Text Message was to deter and discourage Edmunds from travelling to VI for work. And, of course, it succeeded in that aim. It is therefore not at all a surprise that Edmunds reported it was absolutely, intentionally intimidating in those circumstances.
The Applicant failed to comply with the Respondent’s Code and EOP when he harassed Edmunds in this manner. The Code and EOP were lawful and reasonable directions to the Applicant, and the Applicant’s actions of eliciting information from the Island E Diary and thereafter sending Edmunds the Text Message constituted a wilful and serious breach of policy. It follows that there was a valid reason for the Applicant’s dismissal.
Notification of the reason and an opportunity to respond
At a general level, the case law makes it plain that when it comes providing an opportunity to respond, the process does not require any degree of formality, and that the requirement is to be applied in a practical way in order to ensure that the employee is treated fairly.[46] It is accepted that where an employee is aware of the precise nature of the employer’s concern about his or her conduct or performance and has a full opportunity to respond to this concern, this is enough to satisfy the requirements of the sub-section.[47]
Turning to whether the Applicant was afforded an opportunity to respond to the allegations and to ‘Show Cause’ why he should not be dismissed, I consider that the Applicant was notified of the reasons for dismissal and was given an adequate opportunity to respond to such reasons.[48]
First, the Applicant was interviewed as part of the investigation on 8 November 2022 and a written response permitted.
Second, by letter of 9 December 2022, the Applicant was advised of the outcome of the investigation, including the allegations that had been substantiated, the breaches of relevant policies and that a meeting would be held on 12 December 2022 to communicate the proposed disciplinary outcome.[49]
Third, Justin Seal (Seal), People Manager Offshore, and Vitanza met with the Applicant on 12 or 13 December 2022,[50] the purpose of the meeting, said Hawtin, was to discuss the proposed disciplinary outcome of termination of employment, and why it should not be applied.[51]
On 13 December 2022, Hawtin held a debrief teleconference with Vitanza, Seal and Michele Bardy, who substantively held the role of Acting Vice President Production Operations.[52] Hawtin said that Vitanza and Seal disclosed:
a) they had met with the Applicant and his support person on the morning of 13 December 2022;
b) they had followed the Respondent’s usual process of communicating the allegations and findings to the Applicant;
c) they had asked the Applicant for a response and if he had any mitigating reasons as to why he sent the text message; and
d) the Applicant’s feedback was that he had no mitigating reasons for his conduct.[53]
In all the circumstances, I have found that the Applicant was notified of the valid reason and provided with a meaningful opportunity to respond. Whilst there was perhaps a suggestion that Hawtin had predetermined the disciplinary outcome, the evidence is unsupportive of a finding that the Respondent predetermined the disciplinary outcome before providing the Applicant with a meaningful opportunity to respond.[54]
Support person
It is evident from the letter of 9 December 2022 and Mr Michael Quinn’s (Quinn) attendance at the meeting on 12 December 202, that the Applicant was not denied the opportunity to have a support person present at the disciplinary meeting. It is noted that the same Quinn of the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU) represented the Applicant at hearing.
Warnings about unsatisfactory performance
As will be evident from the background material, it was not the case that the Respondent sought to rely upon unsatisfactory performance to justify dismissing the Applicant.
Size of the Respondent’s enterprise and dedicated human resource specialists
The Respondent business is of a reasonable size, employing or engaging more than a couple of hundred workers. It appears to have its own internal human resources expertise and evidently has sufficient financial viability to engage external human resources investigators. In all circumstances, I do not consider that the size of the Respondent business or its internal human resources capability impacted upon the process followed.
Any other matters considered relevant
There are several matters that the Applicant called into question which warrant addressing.
The first is the Respondent’s reliance upon the Investigation Report. The Applicant has observed amongst other matters that:
a) it was authored by a person or persons unknown and is, in effect, anonymous,[55]
b) whilst apparently an external investigation it is produced on the Respondent’s letterhead;
c) it applies an incorrect test at page 11 when reaching an adverse conclusion against the Applicant where it stated that Edmunds felt ‘reasonably intimidated’; and
d) it does not at any point indicate that Edmunds stated that he felt intimidated or that Edmunds used words to that effect.
The Applicant also takes issue in the Respondent having had faith in the chain of custody and chain of credibility in respect of the conduct of the investigation. The Applicant observed that the Respondent asked no follow-up questions and accepted the Investigation Report on its face. The Applicant contends that the Respondent should not have done so, and that a higher degree of diligence was required given the gravity of the potential consequences.[56]
In my view, it was reasonable for the Respondent and, in particular, Hawtin as the decision-maker, to rely on the Investigation Report for the following reasons.
The Respondent engaged a third party to conduct the investigation. It is noted that the Applicant took no issue with the Investigation Report insofar as it represented his account, and it was not disputed that Courtemanche conducted the interview with him and liaised with him regarding subsequent questions. Insofar as it being issued on the letterhead of the Respondent, I consider the point irrelevant to the substance of the evidence garnered and findings made, as detailed in the Investigation Report.
Insofar as the Investigation Report was not explicitly put to the Applicant for him to comment on in the course of the investigation, or that the Respondent did not ask follow up questions regarding the Investigation Report, the Text Message and Edmunds’ reaction to it was at the heart of the case. In the circumstances, I do not consider that there was more that the Applicant could have commented upon, or the Respondent could have asked about in respect of the sending of the Text Message.
The Applicant identified that the Investigation Report referred to an incorrect test at page 11, noting that the Investigation Report sets out that the Applicant engaged in conduct that resulted in Edmunds ‘feeling reasonably intimidated’.[57] While that phrase is used in the Investigation Report, it remains that the Analysis and Findings included the following:
Based on the evidence obtained and the substantiated communication from the Respondent to the Reporter on 15 September 2022, the Reporter's interpretation of the text message as intimidating is reasonable.
As noted in the analysis of Allegation A.1, there was evidence to support that the Respondent had a strong dislike for the Reporter, and did not want him on site to conduct VoC assessments as planned. It is therefore reasonable to surmise, on the balance of probabilities, that the 15 September 2022 text was intimidatory in nature and designed to keep the Reporter from attending site.[58]
The abovementioned findings are neither misplaced, nor do they fall foul of applying an ‘incorrect test’ such that they refer to Edmunds being ‘reasonably intimidated’. However, the second paragraph of the abovementioned extract from the Investigation Report warrants further consideration. It does not appear from the evidence that the Applicant was questioned, or that it was otherwise raised with the Applicant, that there was a purported acrimonious relationship with Edmunds. However, it does not appear from Hawtin’s evidence that this played a part in the decision-making process to terminate the Applicant’s employment. Further, insofar as finding that there was a valid reason for the Applicant’s dismissal, any purported acrimony between the Applicant and Edmunds had no bearing on the conclusion reached.
At hearing the Applicant appeared to take issue with the Investigation Report having been provided to others in the Respondent organisation prior to being delivered to Hawtin. However, the evidence before me is not suggestive that the Investigation Report was altered or otherwise modified prior to it being provided to Hawtin.
In closing submissions, the Applicant invited the Commission to draw an inference against the Respondent for its failure to call Edmunds to give evidence. Essentially, the Applicant appeared to contend that the Commission must draw an adverse Jones v Dunkel[59] inference. The rule in Jones v Dunkel has been described as a ‘rule of common sense and fairness in relation to the fact finding process’.[60] In Hyde v Serco Australia Pty Ltd,[61] the Full Bench observed that the rule in Jones v Dunkel had been considered extensively in Tamayo v Alsco Linen Service Pty Ltd (Tamayo)[62] and outlined the observations made in that case. Observing that the Commission was not bound by the rules of evidence, that it could inform itself in relation to a manner as it considers appropriate and that the Commission must perform its functions and exercise its powers in a manner that is ‘fair and just’, the Full Bench adopted the Tamayo observations. It continued that as the ‘rule’ in Jones v Dunkel is fundamentally concerned with issues of fairness the Commission will give consideration to its application in an appropriate case. It is of course accepted that when exercising discretion concerning the rule in Jones v Dunkel, the discretion is to be exercised in accordance with the dictates of common sense and fairness.[63]
A Jones v Dunkel inference can be drawn where there is a conflict in the evidence on particular issues and there is an unexplained failure to call someone to explain that conflict. First, it should be said that it is not the case that the Respondent failed to explain why it did not call Edmunds to give direct evidence; it submitted that whilst Edmunds was approached to give evidence, he had explained that he did not feel comfortable doing so, and he was not willing to give evidence.[64] Further, while the Applicant essentially disagrees that Edmunds was intimidated by the Text Message and that it was not reasonable for him to have felt that way, the Investigation Report details Edmunds’ account as provided in the interview with Courtemanche, and as noted it is open on the evidence to infer Edmunds was intimidated given his refusal to attend VI post the Text Message and his notification of the incident to his Manager. Further, as to whether it was reasonable for Edmunds to be intimidated, the test is objective. It is difficult to therefore perceive where a conflict exists in the evidence. Furthermore, the Applicant has not articulated with specificity what inferences are sought be drawn from Edmunds’ non-appearance. I therefore decline to draw an adverse inference in the circumstances.
Turning then to the question of proportionality. The Applicant has an extensive history working on VI. Before the Respondent commenced operations on the Island, he was employed to work on the Island by Quadrant Energy which had purchased equity in Apache Energy (his original employer). The Applicant said he had worked on the Island from 6 August 2004 until his was dismissed on 16 January 2023. Vitanza confirmed that the Applicant had worked with the Respondent and its predecessors in that period.
The Applicant’s extensive work history, unblemished performance and conduct record are to be considered against several other factors. Those factors include that the Applicant was cognisant of behavioural expectations within the workplace and particularly whilst PIA was on foot. He had received recent training on the Code and acknowledged at hearing that if the FAQ had been disseminated on the Island, he would have received a copy.
The Applicant’s action of sending the Text Message resulted in Edmunds not flying to VI to perform his work. Whilst appreciative that Edmunds had been contacted by a personal acquaintance before receiving the Text Message, I have found that it was the Text Message that ultimately gave rise to Edmunds declining the work because he felt intimidated to the extent that he was not comfortable to fly to VI. On any objective level, it was reasonable for Edmunds to have responded in the manner he did, and to have felt that way.
The position occupied by the Applicant was that of GSO Lead. In this respect it was not unreasonable for the Respondent to expect a higher standard of behaviour from him.
The Respondent submitted that the Applicant demonstrated a lack of remorse and insight throughout the investigative and disciplinary process. In respect of the investigative process when the Applicant was asked about allegation two, such that the Text Message was unwarranted, unwelcomed and the like, the Applicant responded:
I don't know Darren (audio malfunction) or the SMS or how he felt as a result of my SMS. He did not tell me at the time and I am not permitted to contact him. I do not believe that me sending the SMS quoted in Nathan's letter breached Santos Equal Opportunity Policy, so I don't see that it would be reasonable for Darren to feel humiliated or intimidated or offended, under the circumstances.[65]
During cross examination the Applicant was asked three times whether he accepted that the abovementioned statement was absent remorse, to which he firstly obfuscated[66] and on the second he replied, ‘[n]o’,[67] and on the third occasion questioned, ‘[w]ell how can I be remorseful when I’m not able to contact him or contact any of my fellow workers to back me up?’.[68] As noted, when asked at hearing what his stance was during the investigation about sending the Text Message, the Applicant noted that he did not intend to intimidate Edmunds and that ‘[t]here was nothing wrong, otherwise I wouldn’t have sent it. If he felt that way, then apologies were in order, which was not accepted.’[69]
Regarding the expression of remorse during the disciplinary process, it is uncontroversial that the Applicant expressed remorse at that time. However, whilst the Applicant contends that the disciplinary process was the first opportunity to show any kind of remorse or concern about how the Text Message might have impacted Edmunds, I do not consider that to be the case. The investigative process provided opportunity for such expression. The expression that was forthcoming from the Applicant, was:
…I do not believe that me sending the SMS quoted in Nathan’s letter breached Santos equal opportunity policy because I don’t see that it would be reasonable for Darren to feel humiliated or intimidated or offended under the circumstances.[70]
The Commission’s role is not to consider what it would have done had it been in the position of the employer, rather, it must consider whether the dismissal was harsh, unjust, or unreasonable, taking into account all of the circumstances. The decision to dismiss the Applicant was a significant sanction and I do not consider that it was unjust or unfair, but in my view, it was harsh.
The formulation of ‘harsh, unjust or unreasonable’ calls for an assessment of the gravity of the conduct alleged as the valid reason and assessment of the proportionality of the sanction of dismissal against that conduct, having regard to the fairness of the process leading to dismissal and the consequences for the employee.
In my view, the Applicant’s actions (misconduct) warranted censure. Those actions being the utilisation of information from the Island’s E Diary for the purpose of ascertaining the contractor coming to VI on 16 September 2022, and thereafter sending the Text Message to Edmunds, once Edmunds had been identified as the relevant contractor.
However, the Applicant had been employed by the Respondent or its predecessors for some 20 years with no prior warnings in relation to his operational competency. He was approximately 52–53 years old and had spent the most part of his entire working life on VI. Whilst there is little evidence before me regarding the impact of the termination on the Applicant and his family, on balance, and having regard to all the relevant factors referred in respect of s 387, I have come to the conclusion that the termination of the Applicant’s employment was harsh. This is the case notwithstanding the gravity of the Applicant’s failure to comply with the Code, the resultant consequence of a contractor declining to attend the workplace, and the Applicant’s lack of insight into his wrongdoing.
I am satisfied the circumstances outlined by the Respondent regarding s 387(h) of the Act simply do not outweigh my conclusion regarding proportionality. Having taken into account each of the matters specified in s 387, I am satisfied that the Respondent had a valid reason for dismissing the Applicant based on his conduct. However, the Applicant’s dismissal was harsh within the meaning of s 387 of the Act and it therefore follows that the Applicant’s dismissal was unfair, hence necessitating a consideration of remedy.
Remedy
In his Form F2, the Applicant stated that he sought reinstatement and an order to maintain the continuity of his service, or, in the alternative, an order for the payment of money in compensation.
The issue of remedy has proved problematic given the paucity of evidence and submissions addressing the point. The parties were placed on notice by the directions issued on Thursday, 16 March 2023, that the hearing would contend with jurisdiction, merits, and remedy. On the first day of hearing, that is on 4 May 2023, I further informed the parties that the Commission will also be turning its attention to remedy, noting the relevant sections of the Act: ss 390, 391, 392 and 393. At this juncture it is relevant to observe that I had granted permission for the Respondent to be represented under s 596(2)(a) of the Act, and the Applicant was represented by Quinn, an Offshore Alliance Industrial Officer of the Maritime Union of Australia (part of the CFMMEU). On the second day of the hearing, on 11 May 2023, Quinn made his closing submissions, and I noted the following:
With respect to section 392 of the Act, I note that at the commencement of the hearing, and as would be plain from the directions that have been issued, that the hearing today is not only focused on merits but jurisdiction merits and remedy. Apart from, I think it was evidence from Mr Faccin that he had secured seven days' work since his dismissal, there does not seem to be much else for the Commission to work with, with respect to section 392. I want to place the applicant on notice of that in case you wish to make some submission at this point concerning any considerations the Commission should have [regard to].[71]
Quinn advised the Commission that the Applicant had nothing further to add, noting that the seven days’ work was the extent of the Applicant’s employment and that he had not had any other employment since. I asked Quinn about steps taken by the Application to mitigate loss, to which Quinn replied:
Ma'am, well, we haven't adduced that evidence and I've closed our case, so I don't think it's appropriate to bring him back for that at this stage, and that's an unfortunate…[72]
Reinstatement
Before dealing with the quantum of compensation, the Commission must be satisfied that reinstatement is inappropriate and that an order for payment of compensation is appropriate in all the circumstances.[73] In relation to the first matter, there is no doubt in my mind that reinstatement in this case would be inappropriate. It is evident that the Applicant has demonstrated a lack of insight into his misconduct during both the workplace investigation and during these proceedings (see paragraphs [34] and [62]–[64] of this decision). This is notwithstanding that he was a leading hand in the Respondent’s business and was therefore, in my view, responsible for not only complying with behavioural standards but effectively being a role model for the same. I am satisfied that the relationship between the Applicant and the Respondent has broken down such that there is a loss of trust and confidence in the Applicant that would not be able to be re-established. I also consider that an award of compensation is appropriate in this case.
Compensation
Compensation is provided to an applicant who has been unfairly dismissed for reparation for losses reasonably attributable to the unfair dismissal. It is not intended to be punitive.[74] The amount of compensation ordered by the Commission must not include a component for shock, distress or humiliation, or other analogous hurt, caused to the person by the dismissal.[75]
In assessing compensation, it is necessary to take into account all the circumstances of the case, including the specific matters identified in ss 392(2)(a)–(g), and to consider the other relevant requirements of s 392.
The well-established approach to the assessment of compensation under s 392 is to apply the ‘Sprigg Formula’, derived from the decision of the Full Bench of the Australian Industrial Relations Commission in Sprigg v Paul’s Licensed Festival Supermarket (Sprigg).[76] This approach was articulated in the context of the current legislative framework in Bowden v Ottrey Homes – Cobram & District Retirement Villages Inc (Bowden),[77] and I have applied this methodology in reaching my decision.
Under that approach, the first step to be taken in assessing compensation is to consider s 392(2)(c), that is, to determine what the Applicant would have received, or would have been likely to receive, if the Applicant had not been dismissed (the anticipated period of employment). In Bowden, this was described in the following way:
[33] The first step in this process - the assessment of remuneration lost - is a necessary element in determining an amount to be ordered in lieu of reinstatement. Such an assessment is often difficult, but it must be done. As the Full Bench observed in Sprigg:
‘... we acknowledge that there is a speculative element involved in all such assessments. We believe it is a necessary step by virtue of the requirement of s.170CH(7)(c). We accept that assessment of relative likelihoods is integral to most assessments of compensation or damages in courts of law.’
[34] Lost remuneration is usually calculated by estimating how long the employee would have remained in the relevant employment but for the termination of their employment. We refer to this period as the ‘anticipated period of employment’...[78]
Once the first step of determining the anticipated period of employment has been undertaken, various adjustments are made in accordance with s 392 and the formula for matters including monies earned since dismissal, contingencies, any reduction on account of the employee’s misconduct, and the application of the cap of six months’ pay. This approach is, however, subject to the overarching requirement to ensure that the level of compensation is an amount that is considered appropriate having regard to all the circumstances of the case. The approach can be abbreviated in the following terms:
Step 1: Estimate the remuneration the Applicant would have received, or have been likely to have received, if the Respondent had not terminated the employment (remuneration lost).
Step 2: Deduct monies earned since termination.
Step 3: Discount the remaining amount for contingencies.
Step 4: Calculate the impact of taxation to ensure that the employee receives the actual amount he or she would have received if they had continued in their employment.
Step 5: Apply the legislative cap on compensation.
Remuneration that the Applicant would have been received (s 392(2)(c))
It was undisputed that at the time of his dismissal, the Applicant’s rate of pay was $251,119.00 (gross) per annum inclusive of superannuation. This amounted to a gross monthly remuneration of $20,926.60 (rounded up) or a gross weekly remuneration of $4,829.21.
The evidence suggests that the Applicant’s performance and conduct prior to the Text Message incident was unproblematic. Further, given the Applicant’s longevity with the Respondent business, it would appear that he held no imminent intention to resign from his position.
In short, but for the Applicant’s dismissal, I am satisfied that the Applicant would have proceeded to work for the Respondent for a period that extended to at least six months.
The remuneration that the Applicant would have received or was likely to have received would include payment for the period worked on notice, or the payment received in lieu of notice. Notice is payable at the full rate of pay for the hours the employee would have worked had the employment continued until the end of the minimum notice period. As payment in lieu of notice was provided, this will be deducted from the anticipated period of employment. Under the Applicant’s employment contract, notice was to be in accordance with the ‘Agreement’ (as described at paragraph [12] of this decision). As the Quadrant Energy EA covered the Applicant at the relevant time, I have calculated the paid notice in accordance with that enterprise agreement (clause 8.6) and therefore four weeks has been deducted. In addition, a further week is deducted in compliance with the National Employment Standards.
Therefore, had the Applicant not been dismissed, he would have earned $125,559.60 (gross). However, subtracted from that amount is $24,146.05 for payment in lieu of notice, leaving a total of $101,413.55 (gross).
Remuneration earned (s 392(2)(e) and income reasonably likely to be earned (s 392(2)(f))
The Applicant purports having worked for seven days in the period after his dismissal. After the hearing and given the paucity of evidence before me, I directed the Applicant to provide evidence of such earnings. Such evidence has been considered and included in the Table at paragraph [98] of this decision.
There is no evidence before me to suggest the Applicant was likely to have earned monies during the period between the making of the order for compensation and the actual payment of that compensation. No adjustment will be made on this factor.
Length of service (s 392(2)(b))
I do not consider that the Applicant’s length of service calls for any upward or downward adjustment to the compensation amount that should otherwise be ordered.
Other matters (s 392(2)(g))
As was said in the Full Bench decision in McCulloch v Calvary Health Care Adelaide (McCulloch), it is important to appreciate that a deduction for contingencies is applied to prospective losses, that is loss occasioned after the date of the hearing.[79] Referring to Ellawala v Australian Postal Corporation,[80] the Full Bench in McCulloch stated that a discount for contingencies is a means of taking account of the various probabilities that might otherwise affect earning capacity. Of course, at the time of hearing, any such impact on an applicant’s earning capacity between the date of termination and the hearing will be known. It will not be a matter of assessing prospective probabilities but of making a finding on the basis of whether an applicant’s earning capacity has in fact been affected during the relevant period.[81] This contrasts with the exercise before me now.
It is close to six months since the Applicant’s employment was terminated and there is no direct evidence that he was ill during this period or would have been otherwise unable to work. Further, I have found that he would have been employed a further six months. It follows that any contingency calculation would only have relevance for the six months (namely, between the date of my decision and the end of the anticipated period of employment). As observed, a contingency discount necessarily only applies to future circumstances and, in the context of the present matter, I am not persuaded to make any discount for contingencies.
In relation to taxation, compensation will be determined as a gross amount, and it will be left to the Respondent to deduct any amount of taxation required by law.
Viability (s 392(2)(a))
The Respondent, which was represented, was provided ample opportunity to address this factor, but did not. I am therefore content to find that an order for the payment of compensation would not affect the viability of the Respondent’s business. It follows that there will be no deduction from the compensation amount on this basis.
Mitigation efforts (s 392(2)(d))
Decisions of this Commission and its predecessors concerning the recognition of mitigation efforts do not identify or mandate a single specific approach or formula relative to this discretionary issue.[82] The reasonableness of the efforts taken to mitigate loss depends on the circumstances of the case.[83] As will be evident at this point, the Applicant failed to furnish evidence of steps taken to mitigate his loss, albeit the Commission heard he had secured seven days’ work between the dismissal date and the date of hearing. I have considered that the Applicant had obtained some work and weighed that against there being no other evidence to show mitigation efforts. In the circumstances, I am unable to conclude that the Applicant made reasonable efforts in respect of mitigation and as a consequence I have reduced the compensatory amount by ten percent.
Misconduct (s 392(3))
Section 392(3) of the Act requires that if I consider that misconduct on the part of the Applicant contributed to the dismissal, I must reduce the amount of compensation that would otherwise be awarded. I have concluded that the Applicant’s actions in relation to the incident that led to his dismissal warranted censure, but that the Respondent failed to give due weight to relevant mitigating circumstances and as a result, the dismissal was disproportionate to the Applicant’s actions.
There is relevant misconduct which I consider should reduce the amount otherwise payable as compensation, as provided by s 392(3) of the Act. That is, although the conduct of the Applicant was not misconduct that warranted dismissal because of his longevity of service with the Respondent accompanied by an unblemished performance and conduct record, there was nevertheless misconduct found which otherwise constituted a valid reason for dismissal. In all of the circumstances, a moderate deduction is warranted, particularly given the nature of that misconduct and the extent of projected future employment. I have made a deduction of twenty percent.
Compensation cap (s 392(5))
The amount of compensation the Commission may order is capped. If the appropriate quantum of compensation initially assessed exceeds that cap, then the Commission must reduce the amount to the amount of the cap. The Act stipulates that the compensation cap is the lesser of:
a) the amount of remuneration received by the person, or that he or she was entitled to receive (whichever is higher) in the 26 weeks before dismissal ($125,559.46); and
b) half the amount of the high income threshold immediately before dismissal ($81,000.00).[84]
For the purpose of s 392(5) of the Act, I am satisfied the amount is $81,000.00.
Instalments (s 393)
No reason was put before me to suggest it appropriate that the compensation be paid by way of instalment, and therefore no such order is issued to that effect.
Conclusion
The amount of compensation which is derived from the above considerations is $65,561.49, less deduction of any tax as required by law. I consider that is an appropriate amount of compensation in all the circumstances.
The calculation for compensation is set out in the following table.
| Compensation | Calculation | Total Gross Amount (inclusive superannuation) |
| Anticipated employment period | Six months = $125,559.60 (gross). Subtracted from that amount is $24,146.05 for payment in lieu of notice, leaving a total of $101,413.55 (gross). | $101,413.55 |
| Deduct monies for misconduct | $101,413.55 – 20% = $101,413.55 – $20,282.71 = $81,130.84 | $81,130.84 |
| Deduct monies earned since termination | $81,130.84 – $8,284.74 = $72,846.10 | $72,846.10 |
| Deduction for contingencies | 0% as no significant element of future economic loss (no basis for any deduction for contingencies) | $72,846.10 |
| Calculate any impact of taxation | To be taxed according to law | $72,846.10 |
| Deduction for failure to mitigate loss | $72,846.10 – 10% = $72,846.10 – $7,284.61 = $65,561.49 | $65,561.49 |
| Apply the compensation cap | Half the amount of the high income threshold = $81,000.00 | $65,561.49 |
| $65,561.49 |
In determining the amount for the purpose of the Order,[85] I have taken into account all of the circumstances of the case including the criteria set out in s 392(2) of the Act.
DEPUTY PRESIDENT
Appearances:
M Quinn of the CFMMEU for the Applicant.
S Pack of Counsel for the Respondent.
Hearing details:
2023.
Perth (by video):
4, 11 May.
[1] Digital Hearing Book Part 2, 96 (DHB Part 2).
[2] PR761367.
[3] Witness Statement of Brenton Craig Hawtin, [12] (Hawtin Statement).
[4] Witness Statement of Nathan Anthony Vitanza, [13] (Vitanza Statement).
[5] AE423869.
[6] AE519112.
[7] Vitanza Statement (n 4) [18].
[8] Vitanza Statement (n 4) annexure 1 (emphasis in original); DHB Part 2 (n 1) 52–3.
[9] Transcript of Proceedings, Faccin v Santos WA Energy Ltd (Fair Work Commission, U2023/762, Beaumont DP, 4 May 2023) [PN84] (4 May 2023 Transcript).
[10] Hawtin Statement (n 3) annexure 1; DHB Part 2 (n 1) 121.
[11] Hawtin Statement (n 3) annexure 1; DHB Part 2 (n 1) 120.
[12] Hawtin Statement (n 3) annexure 2; DHB Part 2 (n 1) 126.
[13] Hawtin Statement (n 3) annexure 2; DHB Part 2 (n 1) 128.
[14] AE899793.
[15] 4 May 2023 Transcript (n 9) [PN77].
[16] Vitanza Statement (n 4) annexure 9; DHB Part 2 (n 1) 96.
[17] Vitanza Statement (n 4) [8].
[18] Ibid annexure 3; DHB Part 2 (n 1) 62.
[19] Ibid [29].
[20] Hawtin Statement (n 3) annexure 4; DHB Part 2 (n 1) 189.
[21] Hawtin Statement (n 3) annexure 4; DHB Part 2 (n 1) 189.
[22] Vitanza Statement (n 4) annexure 7; DHB Part 2 (n 1) 71 (emphasis in original).
[23] Witness Statement of Marco Faccin, [25]–[26] (Faccin Statement).
[24] Ibid [27].
[25] Ibid [22].
[26] Ibid [24].
[27] Hawtin Statement (n 3) annexure 4; DHB Part 2 (n 1) 192.
[28] Vitanza Statement (n 4) [8].
[29] Hawtin Statement (n 3) annexure 4; DHB Part 2 (n 1) 191.
[30] Hawtin Statement (n 3) annexure 4; DHB Part 2 (n 1) 192.
[31] Hawtin Statement (n 3) annexure 4; DHB Part 2 (n 1) 191.
[32] (Australian Industrial Relations Commission, Ross VP, Lacy SDP and Commissioner Simmonds, 21 March 2002).
[33] (2012) 219 IR 367.
[34] Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371, 373 (Selvachandran).
[35] B vAustralia Postal Corporation (2013) 238 IR 1, 14 [34]–[36].
[36] Faccin Statement (n 23) [22].
[37] Ibid.
[38] Ibid.
[39] Ibid [14].
[40] Ibid [22].
[41] Ibid.
[42] Ibid [24].
[43] Ibid.
[44] Ibid [25]–[26].
[45] 4 May 2023 Transcript (n 9) [PN245].
[46] Royal Melbourne Institute of Technology v Asher (2010) 194 IR 1, 14–15 [26].
[47] Ibid; Osman v Toyota Motor Corporation Australia Ltd (Australian Industrial Relations Commission, Ross VP, Lacy SDP and Commissioner O’Connor, 17 October 2001); Gibson v Bosmac Pty Ltd (1995) 60 IR 1; Selvachandran (n 34).
[48] 4 May 2023 Transcript (n 9) [PN394].
[49] Hawtin Statement (n 3) annexure 5; DHB Part 2 (n 1) 199–200.
[50] Faccin Statement (n 23) [32].
[51] Ibid [24].
[52] Ibid [25].
[53] Hawtin Statement (n 3) [26].
[54] 4 May 2023 Transcript (n 9) [PN753]–[PN766].
[55] Applicant’s Submissions in Reply, [11].
[56] Transcript of Proceedings, Faccin v Santos WA Energy Ltd (Fair Work Commission, U2023/762, Beaumont DP, 11 May 2023) [PN52] (11 May 2023 Transcript).
[57] Hawtin Statement (n 3) annexure 4; DHB Part 2 (n 1) 197.
[58] Hawtin Statement (n 3) annexure 4; DHB Part 2 (n 1) 197.
[59] (1959) 101 CLR 298.
[60] Hyde v Serco Australia Pty Ltd [2018] FWCFB 3989, [102] (Hyde).
[61] Ibid.
[62] (Australian Industrial Relations Commission, Ross VP, Drake DP and Commissioner Cargill, 4 November 1997).
[63] Hyde (n 60) [103].
[64] 11 May 2023 Transcript (n 56) [PN121].
[65] Vitanza Statement (n 4) annexure 8; DHB Part 2 (n 1) 85.
[66] 4 May 2023 Transcript (n 9) [PN242].
[67] Ibid [PN243].
[68] Ibid [PN244].
[69] Ibid [PN245].
[70] Vitanza Statement (n 4) annexure 8; DHB Part 2 (n 1) 85.
[71] 11 May 2023 Transcript (n 56) [PN62].
[72] Ibid [PN65].
[73] Fair Work Act 2009 (Cth) ss 390(3)(a)–(b).
[74] Kable v Bozelle[2015] FWCFB 3512, [17].
[75] Fair Work Act 2009 (Cth) s 392(4).
[76] (1998) 88 IR 21.
[77] (2013) 229 IR 6.
[78] Ibid 19 [24], quoting Ellawala v Australian Postal Corporation[2000] AIRC 1151 (Ellawala).
[79] [2015] FWCFB 2267 (McCulloch).
[80] Ellawala (n 78).
[81] McCulloch (n 79) [21] citing ibid [43].
[82] Veal v Sundance Marine Pty Ltd [2013] FWCFB 5205.
[83] Biviano v Suji Kim Collection (Australian Industrial Relations Commission, Ross VP, O’Callaghan SDP, Commissioner Foggo, 28 March 2002) [34]; McCulloch (n 79).
[84] Fair Work Act 2009 (Cth) s 392(5)–(6).
[85] PR761367.
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