Mark Kelly v Bawinanga Aboriginal Corp T/A Bawinanga Aboriginal Corporation

[2017] FWC 3412

[2017] FWC 3412

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394 - Application for unfair dismissal remedy

Mark Kelly
v
Bawinanga Aboriginal Corp T/A Bawinanga Aboriginal Corporation
(U2016/15465)

COMMISSIONER WILSON MELBOURNE, 28 JUNE 2017

Application for an unfair dismissal remedy.

[1] Mark Kelly was employed by Bawinanga Aboriginal Corporation (Bawinanga) as its General Manager Civil and Mechanical on 23 May 2016 and remained employed until 5 December 2016. After his employment ended Mr Kelly made an application for unfair dismissal remedy to the Fair Work Commission (the Commission). That application was made on 25 December 2016.

[2] Section 396 of the Fair Work Act 2009 (the Act) requires the determination of four initial matters before consideration of the merits of the application. In relation to the elements within s.396, while I find that Mr Kelly’s application was lodged with the Fair Work Commission within the 21 day period for making such applications; and that questions of consistency with the Small Business Fair Dismissal Code and matters of genuine redundancy do not arise. The objection is made by Bawinanga that at the time Mr Kelly left its employment he was not a person protected from unfair dismissal. The contention that Mr Kelly was not a person protected from unfair dismissal stems from the argument that his employment was not subject to an enterprise agreement and that he earned more than the high income threshold.

[3] Bawinanga also submit that Mr Kelly was not dismissed, but rather resigned from his employment.

[4] As a result, there are two jurisdictional matters that need to be determined before the merits of Mr Kelly’s application are considered;

• whether his employment was subject to an enterprise agreement and if not, whether his earnings exceeded the high income threshold; and



• whether he resigned from employment.

[5] I will deal firstly with the matter of whether Mr Kelly is a person protected from unfair dismissal. The question of whether or not he resigned requires an analysis of the evidence and will be dealt with later in this decision.

WHETHER A PERSON PROTECTED FROM UNFAIR DISMISSAL

[6] The following are the legislative provisions relevant to whether or not Mr Kelly was a person protected from unfair dismissal;

382 When a person is protected from unfair dismissal

A person is protected from unfair dismissal at a time if, at that time:

(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and

(b) one or more of the following apply:

(i) a modern award covers the person;

(ii) an enterprise agreement applies to the person in relation to the employment;

(iii) the sum of the person’s annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold.

CONSIDERATION OF JURISDICTION

[7] In relation to whether Mr Kelly’s employment was covered by an enterprise agreement, the Respondent submits that its agreement does not cover Mr Kelly as his base salary does not fall within any of the classifications of the agreement. 1

[8] The relevant enterprise agreement, the Bawinanga Aboriginal Corporation Contract Salaried Staff 2009 Enterprise Agreement 2 (the Agreement) was approved by the Commission on 5 March 2010 and it passed its nominal expiry date on 11 March 2014. The coverage of the Agreement is set out within clause 5, which provides the following;

“5. COVERAGE OF THE AGREEMENT

5.l. This Agreement is binding on The Bawinanga Aboriginal Corporation and all its Employees whether full-time, part-time or casual, engaged in the performance of work in or in connection with The Bawinanga Aboriginal Corporation with exception of the person appointed by the Board of Directors to the role of Chief Executive Officer.

5.2. This Agreement does not apply to employees who are engaged as CDEP participants and paid under the CDEP program.

5.3. Subject to the Act and except where this Agreement expressly provides otherwise, this Agreement operates to the exclusion of any other agreement, award or industrial instrument.”

[9] Salaries and classifications are dealt with in clause 25 which provides for 10 classification levels. Taking into account that the Agreement provides for a 38-hour working week, Level 9 provides an hourly salary of $38.79, which equates to an annual salary of $76,649.04, and Level 10 provides an hourly salary of $45.40, which equates to an annual salary of $89,710.40. The classification descriptors are set out in Appendix A – Work Level Descriptions. Level 8 is broadly described as an employee “required to exercise managerial responsibility over diverse and / or highly specialised functions that have a significant strategic effect over the distribution of the organisation's total resources”. The same level descriptor then sets out in detail the knowledge and experience of such a person; their likely qualifications; and acquisition and use of skills. The Appendix then provides the following for levels 9 and 10;

“LEVEL 9 EXECUTIVE

Appointment to Level 9 Executive is at the discretion of the employer.

Employees at Level 9 must meet the classification requirements of Level 8. In deciding whether employees should be classified at Level 9, an employer must consider the following things:

• whether additional knowledge and experience are required to undertake the duties of the position;

• the nature and complexity of the decision making and reasoning required;

• the magnitude of the communication and influence exercised;

• the size of the organisation as measured by revenue, number of employees, population, or any other relevant factors; and

• the extent to which the employee is responsible and accountable for the functions undertaken.

Job Requirements for Level 9

Employees at Level 9 may require formal tertiary qualifications that are appropriate to the professional needs of the organisation, together with management skill and experience acquired over extensive years in a senior management role.

An integral part of progression within Level 9 is the acquisition and use of skills. These skills will be gained from training course modules and may include the following skill categories if they are appropriate to the duties and responsibilities of the employee's position:

• Relevant and specific skills or knowledge related to specific tasks or positions.

• Corporate planning and management, advanced financial planning and budget development, advanced negotiation and advocacy skills, human resource management, presentation / media liaison skills, project planning, economic development, and performance management and development.

• Ongoing professional development.

LEVEL 10 EXECUTIVE

Appointment to Level 10 Executive Band B is at the discretion of the employer.”

[10] Mr Kelly’s employment agreement with Bawinanga signed by the parties on 31 May 2016 provided that his employment would be subject to the enterprise agreement. 3 The same employment agreement also contracts that Mr Kelly’s employment would continue until 23 May 2019 unless terminated “before that date in accordance with the termination provisions of the Bawinanga Aboriginal Corporation Enterprise Agreement” and that during a probationary period an earlier termination may occur, including through the payment of a “payment in lieu of notice in accordance with the Bawinanga Aboriginal Corporation Enterprise Agreement”.

[11] The duties applicable to Mr Kelly’s employment are set out in the position description in Schedule 1 to the contract, which provides;

“This position is responsible for the delivery of Civil and Mechanical Workshops services to the Maningrida Community and Home Lands; it operates under the direction of the CEO in accordance with BAC plans, policies, relevant legislation and funding requirements. Primary responsibilities include:

• Lead and manage the delivery of Civil and Mechanical Workshops (heavy vehicle workshop and light vehicle workshop).

• Collate data and prepare reports of quality and relevance for a variety of purposes.

• Review, analyse, interpret and update all Government Contracts and Agreements and mitigate risk to aid in contract renewal.

• Prepare specifications and contract documentation, manage tender processes and let contracts for Civil & Mechanical Workshops.

• Ensure that agreed targets for completion dates for works orders are met on time and within budget.

• Ensure that assets are repaired and serviced according to specifications and agreed standard and available within agreed target timelines

• Liaise with the Workplace Health and Safety Officer to ensure compliance with relevant legislation and BAC policies and report any breaches to mitigate risk to the CEO.

• Assist in the development of a regional strategic and operational plan that sets targets and includes work plans for Civil and Mechanical Workshops, to develop and deliver appropriate services and reporting tools.

• Any other duties as directed by the CEO which are within your capabilities.”

[12] Mr Kelly’s position description is consistent with at least the Level 9 descriptor. For that reason, and that the Agreement on its face only excludes from its coverage one Bawinanga employee – the Chief Executive Officer – I am satisfied that in all the circumstances Mr Kelly’s employment was employment to which the Agreement applied and that he is therefore a person protected from unfair dismissal at the time of termination of his employment. Accordingly it is unnecessary for me to consider further the Respondent’s contentions in relation to the high income threshold.

BACKGROUND

[13] At the hearing of this matter, Mr Kelly gave evidence on his behalf, as did his partner, Angelique Ronan. Bawinanga’s Chief Executive Officer, Karl Dyason, gave evidence on behalf of the Respondent, as did David Morgan, its General Manager, Corporate Services.

[14] Bawinanga is a corporation providing services to a very large area in West Arnhem Land and is based in Maningrida, more than 500km from Darwin. Its website refers to it “improving the lives of people on homelands by caring for culture, languages and country, through services that improve housing, health, education and roads.”

[15] Mr Kelly’s terms of employment have already been dealt with, save to further note that he was also required to reside in Maningrida and was provided with a furnished home in order to do so.

[16] The following, in chronological order, is the relevant background to how Mr Kelly came to leave employment and to the making of his unfair dismissal application.

20 November 2016

[17] The circumstances by which Mr Kelly came to leave his employment include that on 20 November 2016 the vehicle in which he was travelling with a co-worker was stopped by the NT Police on the Maningrida – Oenpelli Road approximately 25km from Maningrida. Bawinanga was the owner of the motor vehicle stopped by the police and Mr Kelly was the driver. When the police conducted a search of the vehicle they found a significant amount of alcohol.

[18] Under Northern Territory law the particular area is one in which the possession of alcohol is highly controlled and subject to a permit system which requires people seeking to use alcohol to have a permit issued by the NT Government, referred to as a Liquor Permit. The Liquor Permit then restricts a permit holder about how much alcohol they may have, where they may purchase it, and how frequently. A Liquor Permit holder may then only possess or consume liquor at their home residence or the residences of other permit holders within defined areas. Permit holders may not bring alcohol into a restricted area other than through an approved and controlled “barge delivery service”. Depending on the permit issued to a holder, they may be permitted each fortnight to take delivery of;

• “one carton of heavy beer or two packs (20 cans) of heavy cider and one carton of light/mid strength beer per fortnight”; or



• “one carton of light/mid strength beer and 6 bottles of wine or one carton of heavy beer/two packs (20 cans) of heavy cider and one carton of light/mid strength beer per fortnight”; or



• “two cartons of light or mid strength beer per fortnight.” 4

[19] After being dismissed from Bawinanga, Mr Kelly obtained a copy of the police incident report, which assists in providing context about the incident and some of the matters about which he gave evidence in this matter. The Northern Territory police report relating to the incident on 20 November 2016 indicated that information had been received by it that Mr Kelly “was coming into Maningrida with alcohol in his vehicle”. The same police report describes the police evidence in these terms;

“A search of the vehicle was conducted and members located;

1 x partial 30pk of carlton mid containing 19 cans

1 x partial 30pk of carlton mid containing 16 cans

1 x green plastic box containing 40 cans of carlton mid

1 x green plastic box containing 34 cans of carlton mid and 10 cans of 'captain morgan rum and cola'

1 x 24 stubbie carton of pure blonde (1 complete carton)

2 x cans of 'James Squire one fifty lashes’

STUBBS made admissions to owning the 2 x cans of 'James Squire' – accidently left with her groceries.

KELLY made admissions to owning the rest of the alcohol.

Alcohol seized for destruction.” 5

[20] Mr Kelly’s evidence is that he was also breathalysed at the time of being stopped by the police and that no evidence was found of him having been driving while under the influence of alcohol. As recorded above, the alcohol was seized by the police. Mr Kelly gave evidence that he was told by the police that they would visit him that evening at home, however that did not occur.

21 November 2016

[21] On 21 November 2016, Mr Kelly reported the incident to Bawinanga’s Chief Executive Officer, Karl Dyason. Mr Kelly’s evidence about the report to Mr Dyason is that he informed him of the situation; that he had cooperated completely with the police and that he had been told they would come to his house but they did not. His evidence also includes that Mr Dyason responded to him “by saying ‘we will see what comes of it’ and I left with the clear impression that the CEO was not too concerned about it anyway”. 6

[22] That report is largely consistent with Mr Dyason’s evidence, who says that Mr Kelly had admitted to police that he had four cases of beer in his car which were then confiscated; that another Bawinanga employee, Vicki Stubbs, was also in the vehicle with him and said that all of the alcohol in the car was his; and that he “informed Mr Kelly that we would determine the appropriate course of action once we knew want action the police were going to take”. 7

[23] David Morgan, Bawinanga’s General Manager Corporate Services, gave evidence that, on 21 November 2016, Mr Kelly came to his office “and asked if I could provide him with a written reference as he was … leaving his employment … with Bawinanga Aboriginal Corporation” but that Mr Kelly did not tell him the reasons why he was thinking of terminating his employment and Mr Morgan did not ask for such reasons. 8

23 November 2016

[24] Mr Dyason then says that he was contacted on 23 November 2016 by the NT Police about the matter;

“8. On Wednesday 23rd November 2016, Sergeant Chambers from the Maningrida Police telephoned me to say that a Bawinanga Aboriginal Corporation staff member had been caught bringing alcohol, specifically beer and UDL’s (premixed spirit drinks) into the community in a Bawinanga Aboriginal Corporation vehicle.

9. Sergeant Chambers noted that the vehicle should have been confiscated but wasn’t due to some uncertainty in the minds of the officers about the correct procedure to be followed with company vehicles.

10. Sergeant Chambers informed me that charges would be laid against the offender.” 9

[25] Mr Dyason’s evidence is that later on the same day there was then a conversation between him and Mr Kelly and that Mr Kelly offered his resignation, which was accepted;

“11. Later that day I met with Mr Kelly and informed him of the conversation with Sergeant Chambers.

12. Mr Kelly immediately offered me his verbal resignation, which I accepted.

13. We both agreed that Mr Kelly’s final day would be 5 December 2016, as we had an important meeting in Darwin on that day.

14. During the conversation with me, Mr Kelly asked what the consequences would be if he didn’t resign and I explained that his contract would be terminated. There was agreement at that time that it would be in Mr Kelly’s best interest to resign.

15. I asked Mr Kelly to forward the resignation to me in writing at his earliest convenience.” 10

[26] Mr Kelly disputes that he and Mr Dyason had a meeting on 23 November 2016. 11 Mr Kelly says about the day in question that it was in the middle of a busy week and that he was undertaking some road works.

24 November 2016

[27] Mr Kelly’s evidence is that he and Mr Dyason did not have a further discussion until 24 November 2016, when, after the regular managers’ committee meeting, he was asked by Mr Dyason “What’s the latest? Have you heard from the police?” 12 However at that time, Mr Kelly had not heard from the police.13

25 November 2016

[28] Mr Kelly puts forward that on 25 November 2016 Mr Dyason suggested that he should resign, putting forward the following submission;

“25/11/2016 - On the 25th of November 2016 the Bawinanga Aboriginal Corporation CEO Karl Dyason called Mark Kelly requesting for him to come to his office. Mark went and spoke in the CEOs office with only Karl and Mark present. Karl Dyason said "I received a phone call from the police and that the police would be going ahead with charges and that the intentions would be to make an example of his manager's position."

Karl then said to Mark that "It would be best if he hands in his resignation as he would have two weeks to pack up and leave the community."

Mark Kelly responded with - "This is ridiculous and unfair due to the effort I've put in with everything, returning a deficit within my area of $600,000.00 out of the red to near zero in just over a six-month period."

Karl Dyason said "It goes against the code of conduct as a manager."

Mark Kelly then left the CEO's Office.” 14

[29] Ms Ronan gave evidence that she was called by Mr Kelly on 25 November 2017, where he told her about the situation and the invitation that he leave his position. 15

[30] While putting forward a different date for the conversation in question, Mr Dyason’s evidence is that he and Mr Kelly participated in a conversation about Mr Kelly’s termination of employment;

“2. I did not initially say to Mr Kelly that it would be in his best interest to resign. Mr Kelly verbally offered his resignation when we met on 23rd November 2016, which I accepted. Following that I did advise him that if he resigned I would be able to offer him a referee report attesting to the quality of his work without mentioning the reasons for his resignation. However if his contract was terminated I would have to explain why.

3. When I was asked by Mr Kelly, I informed him that if he did not resign, his employment with Bawinanga Aboriginal Corporation would be terminated.

4. I informed Mr Kelly that his actions were a serious breach of the Bawinanga Aboriginal Corporation Code of Conduct.” 16

28 November 2016

[31] On 28 November 2016, Mr Kelly was apparently in Darwin, and Ms Ronan’s evidence is that she sent a text to Mr Dyason on Mr Kelly’s behalf on the subject of the alcohol confiscation and what it meant for his employment, and that a response was received in reply;

• Sent by Ms Ronan at 4:50 PM – “Hi Karl, hope your going well, Mark asked me to let you know that hes stuck in Darwin, because of Cahill crossing and his phone isn’t working properly now but has a new one in maningrida, he’s been struggling a bit to tell you the truth but he’s doin a lot better now. Also I will send threw, hopefully tonight, the last lot of MAK Invoices and tidy up and finalise things from this end. Thank you, Karl. Ange”

• Sent by Mr Dyason at 4:57 PM - “Thanks Ange, I know this is hard for everyone, especially Mark but he will pull through. He is a great operator and a really hard worker and I will give him a good reference. He needs to give me a call when he’s ready so we can sort out a neat exit. We won’t leave him in the lurch. Karl” 17

29 November 2016

[32] Mr Kelly’s evidence is that he and Mr Dyason had a further conversation on Tuesday, 29 November 2016, with Mr Dyason calling him as follows;

“29/11/2016 - On Tuesday the 29th of November 2016 -

Karl Dyason called Mark Kelly and said - "What's Happening?"

Mark Kelly responded with - "I'm so confused Karl and I can't believe what is happening"

Karl Dyason responded with - "Would you like me to put in an email that this conversation would act as a verbal of confirming your resignation for you?"

Mark Kelly responded with - "I don't think I should resign and won't be resigning"

Karl Dyason responded with -" If we haven't received your resignation by Monday morning (5th of December 2016) I will be Terminating your Employment on the 5th of December 2016."” 18

5 December 2016

[33] Both Mr Kelly and Mr Dyason were at a meeting in Darwin on 5 December 2016 and they both discussed Mr Kelly’s employment status at that time. Later the same day Mr Kelly received an email attaching a letter terminating his employment. Mr Kelly’s recollection about the circumstances is the following;

“At 4.30pm on Monday the 5th of December Karl and I went down stairs after being at a Government meeting together and he asked if I had my resignation and I replied "Karl once again, I will not be resigning, I don't think I should be made too." I feel I was treated with an unreasonable punishment from the corporation, Karl then stuck to his word and said I was terminated, and we went our separate ways.

At 5.22pm that evening David Morgan sent me an email with my termination letter attached only. I was not aware of this code of conduct and had to request a copy of it to be sent to me which I received on the 14/12/2016”. 19

[34] Mr Dyason puts forward that in the conversation on 5 December 2016 that “Mr Kelly did not rescind his verbal resignation until the meeting held with me on the afternoon of Monday 5^th December 2016”. 20

[35] Mr Morgan’s evidence was that he had been asked to prepare the letter by Mr Dyason and email it to him with that request having been made on the afternoon of 5 December 2016. 21

8 December 2016

[36] Following the termination of Mr Kelly, which took effect on Monday, 5 December 2016, one of the practical effects of the dismissal was that he needed to leave accommodation provided by the organisation as well as transport his belongings away. The circumstance led to Ms Ronan sending an email to Mr Dyason on Mr Kelly’s behalf on 8 December 2016, acknowledging receipt of the termination of employment letter. In the correspondence Ms Ronan wrote, in part;

“Hi Karl

This email is to formally acknowledge receipt of Marks Employment Termination Letter.

As per the many discussions with the Bawinanga Aboriginal Corporation (BAC) Chief Executive Officer, Karl Dyason in particular_ on Friday the 25th of November 2016, who advised Mark that he had to resign from his position as General Manager Civil and Mechanical Workshops and to leave Maningrida within 2 weeks, furthermore, as per the discussions with the Bawinanga Aboriginal Corporation (BAC) Chief Executive Officer, Karl Dyason on Tuesday the 29th of November 2016, who clearly stated again to Mark that he had to resign and if he had not presented the Bawinanga Aboriginal Corporation with his resignation by Monday the 5th of December 2016 that he (Karl Dyason, BAC CEO) would be Terminating his Employment with the Bawinanga Aboriginal Corporation as General Manager Civil and Mechanical Workshops on the 5th of December 2016.

…” 22

[37] Mr Kelly’s unfair dismissal application records that he was not charged by the police for an offence arising out of the incident on 20 November 2016 until nine days afterwards. 23 The evidence also shows that the charges laid against Mr Kelly were heard in the Darwin Magistrates’ Court on 14 December 2016, at which time the Court did not impose a conviction but fined Mr Kelly $300 with a levy of $150.24

[38] Unrelated to the unfair dismissal matter is a dispute between Bawinanga and a business run and operated by Mr Kelly and Ms Ronan. That business is in dispute with Bawinanga about payments made to it, or due to be made to it, in relation to earthmoving equipment. Bawinanga also allege that, since leaving its employment, it has determined Mr Kelly owes it money for unauthorised expenditure and that he has property of the organisation’s that has not been returned.

LEGISLATION

[39] The matters now requiring determination are whether Mr Kelly has been dismissed within the meaning of the Act and whether in all the circumstances that dismissal was unfair.

[40] The legislative provisions relevant to those matters are set out in sections 385, 386 and 387 of the Act, which provide as follows;

385 What is an unfair dismissal

A person has been unfairly dismissed if the FWC is satisfied that:

(a) the person has been dismissed; and

(b) the dismissal was harsh, unjust or unreasonable; and

(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and

(d) the dismissal was not a case of genuine redundancy.

Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.

386 Meaning of dismissed

(1) A person has been dismissed if:

(a) the person’s employment with his or her employer has been terminated on the employer’s initiative; or

(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.

(2) However, a person has not been dismissed if:

(a) the person was employed under a contract of employment for a specified period of time, for a specified task, or for the duration of a specified season, and the employment has terminated at the end of the period, on completion of the task, or at the end of the season; or

(b) the person was an employee:

(i) to whom a training arrangement applied; and

(ii) whose employment was for a specified period of time or was, for any reason, limited to the duration of the training arrangement;

and the employment has terminated at the end of the training arrangement; or

(c) the person was demoted in employment but:

(i) the demotion does not involve a significant reduction in his or her remuneration or duties; and

(ii) he or she remains employed with the employer that effected the demotion.

(3) Subsection (2) does not apply to a person employed under a contract of a kind referred to in paragraph (2)(a) if a substantial purpose of the employment of the person under a contract of that kind is, or was at the time of the person’s employment, to avoid the employer’s obligations under this Part.

387 Criteria for considering harshness etc.

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:

(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and

(b) whether the person was notified of that reason; and

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

(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and

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

(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(h) any other matters that the FWC considers relevant.

CONSIDERATION

[41] The main evidence in this matter, being the evidence of the events that took place directly between Mr Kelly and Mr Dyason, obviously comes from only those two people in the absence of there being any witnesses put forward about the conversations that took place.

[42] The evidence in this matter suffers from the absence of a direct, internally consistent and non-contradictory version of the events that took place. The evidence of both the main protagonists, Mr Kelly and Mr Dyason, suffers to a degree from embellishment, inconsistency or a failure to recollect what took place on which day. While that is so, I prefer the evidence mainly of Mr Dyason where it is in conflict with that of Mr Kelly. In many respects, other than two important issues, Mr Dyson’s recollection is consistent with documentary or other externally verifiable matters. The two issues to which I refer are;

• Firstly, that he is adamant that Mr Kelly agreed to resign as early as the conversation that took place between the two on 23 November 2016. I consider that to be an embellishment on Mr Dyason’s part and is not consistent with their later conversations. My consideration of the evidence leads to the view that while resignation was raised by Mr Dyason as a possible action by Mr Kelly, the latter neither agreed nor dismissed it outright. It is also more likely than not that Mr Dyason suggested 5 December 2016 as a suitable finishing date.



• Secondly, an inconsistency within Mr Dyason’s evidence about the date upon which the two discussed in some detail whether Mr Kelly should resign. Mr Kelly puts the conversation as having taken place on 25 November whereas Mr Dyson says that the conversation took place on 23 November 2016. The overall available evidence suggests that the conversation more likely took place on 25 November 2016, when resignation was put forward as a firm proposal to Mr Kelly.

[43] I have taken these deficiencies on the part of Mr Dyason’s evidence into account in making determinations about the key events concerning Mr Kelly’s termination of employment, but note that in the overall scheme of the evidence before me, featured as it is by significant imperfections in the evidence of both witnesses, these two problems do not cause me to disregard Mr Dyason’s evidence or to accord it lesser weight than Mr Kelly’s.

[44] In relation to Mr Kelly’s evidence, I consider his evidence that he never agreed to voluntarily leave Bawinanga as contradicted by the text message exchange between Ms Ronan on his behalf and Mr Dyason on 28 November 2016. In her text message Ms Ronan says to Mr Dyason that she will send to him that night the last of the MAK invoices pertaining to the work being undertaken by Mr Kelly’s business for Bawinanga “and tidy up and finalise things from this end”. The text plainly gives rise to the impression of a relationship coming to an end. While it could be said that it is in relation to Mr Kelly’s business and not to his employment, it is more likely than not that it was a reference to the conclusion of both relationships. The text in return from Mr Dyason confirms that perspective. Having referred to the circumstance being hard for everyone, in reference to Mr Kelly it offers the proposition that “he will pull through”, which is ordinarily a reference to someone rebounding from a setback, perhaps such as a termination of employment or other significant life event. The same text commits that Mr Dyason “will give him a good reference” and that “a neat exit” can be sorted out, together with the proposition that Bawinanga “will not leave him in the lurch”.

[45] None of the comments in the texts make much sense if there was to be an ongoing employment relationship between Mr Kelly and Bawinanga. Neither are they consistent with a situation in which Bawinanga was headed to a dismissal of Mr Kelly.

[46] In all the circumstances I am satisfied that on the uncontested evidence, or on the balance of probabilities where that is stated, that the following took place;

• On 21 November 2016, Mr Kelly disclosed to Mr Dyason the fact that he had been pulled over by the police and found with alcohol in the vehicle and that at that time Mr Dyason did not take or disclose his views about any particular action, but instead wanted to find out more about the situation;



• On 23 November 2016, having received advice from the police about the situation and having formed the view that the incident was a serious one which had the potential to reflect significantly upon Bawinanga and its governance, Mr Dyason likely formed the view that he would invite Mr Kelly to resign;



• The balance of probabilities suggests that Mr Dyason put his view to Mr Kelly, mostly likely on 25 November, that he should resign and should do so by 5 December 2016, which was not agreed to at that time by Mr Kelly. Mr Dyason then allowed Mr Kelly some time to think about the situation;



• After that conversation, Mr Dyason spoke with Mr Kelly about his plans on several occasions, on at least 28 November and 5 December 2016, and that he was progressively firmer to Mr Kelly that resignation was something he should do;



• The finding is available on the balance of probabilities that Mr Dyason put to Mr Kelly on multiple occasions that he should resign and that at some point, no later than 28 November 2016, he agreed. The evidence in the form of the two text messages between Ms Ronan on Mr Kelly’s behalf and Mr Dyason confirms that more likely than not he had agreed at some time prior to the date on which they were sent, 28 November 2016, to voluntarily leave employment with Bawinanga;



• On 5 December 2016, on the balance of probabilities Mr Dyason formed the view that Mr Kelly had changed his mind about a resignation and that one would not be forthcoming and that he should instead dismiss Mr Kelly from employment.

[47] As a result it follows that a finding must be made that Mr Kelly was dismissed on Bawinanga’s initiative and that at no time did he resign from his employment.

[48] Accordingly it follows that the application made by Mr Kelly for an unfair dismissal remedy is within the Commission’s jurisdiction to deal with.

[49] Determination of whether Mr Kelly’s dismissal was harsh, unjust or unreasonable requires each of the matters specified in s.387 to be taken into account.

[50] The Full Bench has summarised the approach that should be taken by the Commission to the criteria within s.387 in the following way; 25

“[28]The following propositions concerning consideration as to whether there is a valid reason for dismissal for the purpose of s.387 are well established:

•  a valid reason is one which is sound, defensible and well-founded, and not capricious, fanciful, spiteful or prejudiced; 26

• a reason would be valid because the conduct occurred and justified termination; conversely the reason might not be valid because the conduct did not occur or it did occur but did not justify termination (because, for example, it involved a trivial misdemeanour); 27



• it is not necessary to demonstrate “serious misconduct” or misconduct sufficiently serious to justify summary dismissal in order to establish a valid reason for dismissal; 28



• the existence of a valid reason to dismiss is not assessed by reference to a legal right to dismiss 29 (so that, for example, where summary dismissal has occurred, it is not necessary to determine whether the right of summary dismissal was legally available); and



• the criterion for a valid reason is not whether serious misconduct as defined in reg.1.07 has occurred, since reg.1.07 has no application to s.387(a) (although a finding that misconduct of the type described might well ground a conclusion that there is a valid reason for dismissal based on the employee’s conduct). 30” (original references)

[51] I will deal with each of the criteria within s.387 in turn.

(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees)

[52] Determination of whether there was a valid reason for a person’s dismissal involves an examination of whether the reason given is “sound, defensible or well founded”, within the overall context of the employment relationship;

“At the same time the reason must be valid in the context of the employee’s capacity or conduct or based upon the operational requirements of the employer’s business. Further, in considering whether a reason is valid, it must be remembered that the requirement applies in the practical sphere of the relationship between an employer and an employee where each has rights and privileges and duties and obligations conferred and imposed on them. The provisions must ‘‘be applied in a practical, commonsense way to ensure that’’ the employer and employee are each treated fairly, see what was said by Wilcox CJ in Gibson v Bosmac Pty Ltd (1995) 60 IR 1, when considering the construction and application of s 170DC.” 31

[53] Having been dismissed for misconduct, the Commission is first required to find whether on the balance of probabilities the alleged misconduct actually occurred. 32 In doing so, the Commission will take into account the need to be properly satisfied of the proofs of the conduct; without applying a standard of proof higher than the balance of probabilities.33 The Commission will also take into account the need for honesty on the part of the applicant during the course of an investigation.34

[54] The conduct for which Mr Kelly was dismissed is set out in the letter of termination to him, being that he was found “in possession of an illegal amount of alcohol” and that he was driving a Bawinanga motor vehicle at the time the police conducted a vehicle search. Mr Kelly does not contest those essential facts, however he does then contest that part of the termination letter which says that as a consequence of those matters he was in breach of the Bawinanga code of conduct. His argument in this regard also includes that his behaviour does not constitute serious misconduct with it being insufficiently serious for termination of employment. He also argues that, having become aware of the search incident on 21 November 2016, and because Bawinanga did not then act upon it immediately or soon after the event, they waived their right to rely upon the ground of serious misconduct for termination of employment. Mr Kelly’s submission is that at the time of his dismissal he was not aware of any workplace policies in relation to the possession of alcohol or of there even being a code of conduct and that he was only sent a draft copy of the Bawinanga Code of Conduct after requesting it on 15 December 2016. 35

[55] Mr Kelly contests that at any relevant time he was made aware of the code of conduct or other policies and procedures of Bawinanga that would leave him with the view that the transgression of his obligations in respect of the alcohol permit system would either constitute misconduct as an employee or otherwise place his job in jeopardy. He also argues that the search of his vehicle “had been set up from the moment I had left Maningrida for Darwin”. 36

[56] Mr Dyason’s evidence is that at one stage during the conversations they had about Mr Kelly’s future that he “informed Mr Kelly that his actions were a serious breach of the Bawinanga Aboriginal Corporation Code of Conduct”, although the evidence does not make clear when that statement was put to Mr Kelly. 37 Mr Dyason’s evidence is also that during the same course of conversations;

“16. Over the next few days, I had several conversations with Mr Kelly about the consequences of him being caught bringing alcohol into Maningrida. I explained to Mr Kelly that as an Aboriginal controlled organisation, Bawinanga Aboriginal Corporation had to have an impeccable reputation. I also explained that as Mr Kelly was a senior manager that his actions had to be above reproach.” 38

[57] Further to this, Mr Dyason also puts forward the following response to Mr Kelly’s contention that he was unaware of the code of conduct;

“18. Mr Kelly was aware of the Bawinanga Aboriginal Corporation Code of Conduct as a copy of the code is provided in the Bawinanga Aboriginal Corporation New Employee Starter Pack. Mr Kelly also supervised the recruitment of several other employees into his work area and brought them in to complete the new employee commencement process, which included the provision of the code of conduct to each employee.

19. Mr Kelly was aware that he had to abide by the organisation’s policies and procedures. It is stated in clause 20 – Values, Policies and Procedures, of Mr Kelly’s employment contract. The relevant parts are:

“Bawinanga Aboriginal Corporation has an agreed set of values and expects employees to meet those values. Policies and procedures have also been developed to assist with the administration of its business and to provide guidance to employees about various matters.”

“These values, policies and procedures contain important information about your obligations as an employee, including how you should perform your duties and appropriate standards of behaviour and conduct.”

“Bawinanga Aboriginal Corporation’s values, policies and procedures do not form part of this Agreement. However, where they place obligations on you, it is a condition of your employment that you comply with them at all times.”

20. All Bawinanga Aboriginal Corporation policies and procedures are available to employees on the G: Drive of the organisation’s computer network. Mr Kelly was made aware of this when he commenced his employment.

21. Mr Kelly as a senior manager was involved in the workshopping of at least one new policy at the senior management team meetings. This was the Motor Vehicle Policy.

22. Mr Kelly was also actively involved in the new employee process for a number of staff under his supervision. He was given employment packs for these employees to complete when he brought them into the Human Resources Office on their first day at work.

23. Mr Kelly’s employment contact has the following conditions contained in Schedule 2 – Expected standards of behaviour:

“You must at all times during your employment:

• Comply with all policies and procedures of Bawinanga Aboriginal Corporation in place from time to time.”

And

“You must not at any time:

Undertake criminal or serious obnoxious behaviour with respect to alcohol or drugs as this will likely result in termination of your employment and your expulsion from the community.”

24. Mr Kelly, as a senior manager, was expected to fully understand and comply with all conditions of employment and to set a positive example, by his conduct, to the employees he supervised.” 39

[58] Mr Kelly also puts forward that he was treated differently to the other employee who was in the vehicle at the same time as him, Ms Stubbs. According to the evidence before the Commission, Ms Stubbs conceded that she had brought two cans of beer into the restricted area in the vehicle being driven by Mr Kelly. Bawinanga submits that rather than being dismissed she was issued with a first and final written warning that any further incidents of that nature may result in termination of her employment for serious misconduct and she was not charged by the police with any offence. 40 Mr Kelly’s submission is that he should have been treated in the same way as Ms Stubbs because he had a genuine reason for his actions as well.41 Mr Kelly’s explanations in relation to the possibility of there being a “genuine reason” are somewhat mixed. On the one hand he puts forward;

“I simply made a single foolish choice by having alcohol in my possession, the magistrate gave me the opportunity to explain all the circumstances surrounding it and I am genuinely grateful to come out with no conviction and an unblemished record, he listened to what I had to say and treated me fairly.” 42

[59] On the other hand an NT Police report indicates Mr Kelly as having said to the officer concerned that having claimed ownership of the alcohol “he was taking it home as the XXXX Gold in Maningrida was ‘off’”, 43 which is consistent with the explanation he gave in oral evidence. As a result, the “genuine reason” put forward by Mr Kelly appears to be that he made an unfortunate mistake and was driven by the desire to have beer in Maningrida of an acceptable quality.

[60] Mr Kelly also puts forward that having been charged by the police and then being the subject of proceedings before the Darwin Magistrates’ Court, where the matter was dealt with through a fine and levy being recorded, but without a conviction, the matter should be regarded as having been dealt with to finality, when in fact he had already been dismissed.

[61] For its part, the Respondent puts forward that the overall conduct of Mr Kelly is unacceptable because of his breach of the Northern Territory’s liquor permit system and the fact that as a senior managerial employee of Bawinanga, driving a Bawinanga vehicle, his actions have the potential to bring him and Bawinanga into disrepute within its community, and that the combined effect of these matters amounted to not only a breach of Bawinanga’s policies and procedures, but also Mr Kelly’s contract of employment.

[62] The significance to Bawinanga of the liquor permit system which applies in Maningrida is set out within Mr Dyason’s witness statement in several parts. He firstly says that alcohol abuse is a major problem in aboriginal communities, which is reinforced by Maningrida being a community where an individual has to hold a permit to purchase alcohol through a prescribed process about which Mr Kelly was well aware, having applied for and been issued a permit. 44 Mr Dyason also refers to statutory declarations filed as part of the Bawinanga submissions by two Maningrida community leaders, Wesley Campion and Matthew Ryan, which set out certain matters regarding drugs and alcohol within the community. While noting that neither Mr Campion nor Mr Ryan gave evidence in these proceedings, I am prepared to rely upon the statements set out within their statutory declaration, which are in identical terms;

“4. Sly grog and drugs is having a very big impact in the community where it causes disruptions and high level of domestic violence. There may be consequences where there are accidents and people maybe killed because of the drug and alcohol.

5. We want to prevent people harming themselves socially and mentally.

6. It is very important to have a controlled grog permit so we have our children going to school every day to have health and education.

7. There is strong community support that opposes sly grog and drugs coming into the community.

8. We want the police to be more proactive and engaging with the community in preventing sly grog and drugs entering the community.

9. Community safety is our big priority. All community elders support this.” 45

[63] Having considered all of the evidence in this matter, the following findings are available to me about Mr Kelly’s conduct and whether or not there is a valid reason for his dismissal;

• Mr Kelly’s situation is distinguishable from that of Ms Stubbs. He was the driver of the vehicle and does not claim that he was bringing the alcohol into the community as the result of a mistake. The amount of alcohol that he attempted to bring into Maningrida was substantially greater than that in Ms Stubbs’ position.



• There is no evidence before the Commission that would lead to a finding that Mr Kelly had in any way been set up for the police search.



• The amount of alcohol Mr Kelly attempted to bring into Maningrida was objectively large, being 143 cans. While there is no evidence to suggest that this was anything other than personal use, the volume cannot be disregarded as being anything other than significant.



• Mr Kelly must reasonably have been aware at the time that what he was endeavouring to do was in breach of the liquor permit he had applied for and been issued and that when he chose to attempt to bring the alcohol into Maningrida that he accepted the risks which came with the attempt.



• Mr Kelly must also be considered, on the balance of probabilities, to have been aware of the existence of Bawinanga’s policies and code of conduct as well as his obligation within his employment agreement which explicitly states that Bawinanga’s policies and procedures place obligations on him and that it is a condition of his employment that he comply with them at all times.

[64] I consider that in all the circumstances Bawinanga had a valid reason to dismiss Mr Kelly because of the circumstances arising out of 20 November 2016. The reason is that articulated in the termination letter sent to him on 5 December 2016, which recorded that he had been found in possession of “an illegal amount of alcohol” when pulled over by the police when driving a Bawinanga motor vehicle, with that conduct then being in breach of the Bawinanga code of conduct, the collective effect of which constitutes serious misconduct.

[65] I consider this to be a valid reason within the overall context of Bawinanga’s operations, being a community-owned corporation in a remote part of the Northern Territory, with the community then being subject to significant and restrictive liquor licensing arrangements for the betterment of the community. It must be regarded that an endeavour by a senior employee to wilfully attempt to ignore the liquor permit system is a very serious matter. Bawinanga was entitled to see it as such and one which justified Mr Kelly’s dismissal.

(b) whether the person was notified of that reason

[66] The evidence establishes that Mr Kelly was notified of the reasons for his termination.

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

[67] For the Commission to have regard to whether an employee has been given an opportunity to respond to the reason for dismissal, there needs to be a finding that there is a valid reason for dismissal. 46

[68] While the evidence points to their being discussion between Mr Kelly and Mr Dyason about whether Mr Kelly should first resign, with him ultimately refusing to take that path, the evidence also points to there being a dialogue between the two about whether termination of employment should follow from the circumstances that had occurred. I am satisfied on the basis of that evidence that Mr Kelly was able to express to Mr Dyason any and all matters that he wanted Bawinanga to take into account about his conduct.

(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal

[69] There was no refusal by Bawinanga for Mr Kelly to have a support person in any discussions that were had about the future of his employment. Accordingly this factor is a neutral consideration in my decision.

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

[70] Mr Kelly was not dismissed because of unsatisfactory performance and so this factor is also a neutral consideration in my decision.

(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal

[71] The employer response form filed by Bawinanga at the commencement of these proceedings indicates that at the time Mr Kelly was dismissed it had 197 employees. The evidence before the Commission includes that Bawinanga operates with a Chief Executive Officer and several general managers as well as a human resource manager. There is no evidence before the Commission that would lead to a finding that the size of Bawinanga impacted upon the procedures followed in effecting Mr Kelly’s dismissal. Accordingly this factor is a neutral consideration in my decision

(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal

[72] Other than being aware that Bawinanga has a human resource manager, there is no evidence before the Commission about the availability or otherwise of human resource management specialisation or expertise that may have impacted upon the procedures followed in effecting Mr Kelly’s dismissal. Accordingly this factor is a neutral consideration in my decision.

(h) any other matters that the FWC considers relevant

[73] There are three matters which should be recorded as having potential relevance to my consideration of Mr Kelly’s application, but which for the reasons explained below are considered to not.

[74] The first of the matters is that, as referred to above, Mr Kelly was not only at the relevant time an employee of Bawinanga but also the provider of services to Bawinanga through his business. Following the termination of his employment a dispute arose between that business and Bawinanga which, at the time of the hearing, was unresolved. There is nothing within the evidence before the Commission in relation to that business dispute that would lead me to form a view that the business dispute impacted upon Bawinanga’s decision to dismiss Mr Kelly.

[75] Secondly, Bawinanga claim that Mr Kelly incurred expenses for Bawinanga prior to his dismissal and that those expenses were unauthorised. Bawinanga has claimed in the course of these proceedings that there is an obligation on Mr Kelly to repay those amounts. While that may be the case, and I make no determination that it is, those matters are external to the question of whether or not Mr Kelly was unfairly dismissed. There is no evidence that any of those matters were the reason for Mr Kelly’s dismissal.

[76] Finally Bawinanga claim that certain property belonging to it was taken by Mr Kelly following his dismissal and that he remains in possession of that equipment. The evidence in relation to that claim is insubstantial. I make no findings about the claim and do not take the claim into account in determining whether Mr Kelly’s dismissal was fair or otherwise.

[77] On the basis of the matters set out above, I am of the view that Bawinanga had a valid reason for Mr Kelly’s dismissal and that consideration of the other criteria within s.387 does not give rise to any matters which would cause me to form the view that notwithstanding the finding there had been a valid reason, Mr Kelly’s dismissal was otherwise unfair.

[78] For those reasons I find that Mr Kelly was not unfairly dismissed by Bawinanga Aboriginal Corporation on 5 December 2016. As a result his application for unfair dismissal remedy must be dismissed and an Order to that effect is issued at the same time as this decision.

COMMISSIONER

Appearances:

Mr M Kelly and Ms A Ronan for the Applicant.

Mr K Dyason and Mr D Morgan for the Respondent.

Determinative Conference details:

2017.

Darwin (by video link and telephone):

5, 18 April.

 1   Exhibit R3, Respondent’s Jurisdictional Objections, 1.

 2   AE874647.

 3   Exhibit R4, Respondent’s Documents Bundle, Document 1.

 4   Exhibit A5, Applicant’s Documents Bundle, Document 9.

 5   Ibid Document 5.

 6   Exhibit A3, Statutory Declaration of Mark Kelly, [2].

 7 Exhibit R1, Witness Statement of Karl Dyason, [3]-[6].

 8 Exhibit R2, Witness Statement of David Morgan, [1]-[2].

 9   Exhibit R1 [8]-[10].

 10   Ibid [11]-[15].

 11   Exhibit A6, Applicant’s Further Documents, Document 12, 3.

 12   Exhibit A1, 8.

 13   Exhibit A6 Document 12, 3.

 14   Exhibit A1, 8.

 15   Exhibit A4, Statutory Declaration of Angelique Ronan, [3].

 16 Exhibit R1, Responses to Applicant’s Contentions, [2]-[4].

 17   Exhibit A5, Documents 12 and 13.

 18   Exhibit A1, 8.

 19   Exhibit A1, 12.

 20   Exhibit R1, Response to Applicant’s Contentions, [9].

 21 Exhibit R2 [10].

 22   Exhibit A5 Document 2.

 23   Form F2 Item 3.2.

 24   Exhibit A5 Document 10.

 25   Titan Plant Hire Pty Ltd v Shaun Van Malsen[2016] FWCFB 5520.

 26   Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371 at 373.

 27   Edwards v Giudice [1999] FCA 1836; (1999) 94 FCR 561 at [6]-[7].

 28   Sharp v BCS Infrastructure Support Pty Limited[2015] FWCFB 1033 at [32]; Annetta v Ansett Australia (2000) 98 IR 233 at [9]-[10].

 29   Sharp v BCS Infrastructure Support Pty Limited[2015] FWCFB 1033 at [32]; He v Lewin [2004] FCAFC 161; (2004) 137 FCR 266 at [15].

 30   Sharp v BCS Infrastructure Support Pty Limited[2015] FWCFB 1033 at [33]-[34]; O'Connell v Wesfarmers Kleenheat Gas Pty Ltd [2015] FWCFB 8205 at [22]-[23].

 31   Selvachandran v Peteron Plastics (1995) 62 IR 371 at 373.

 32   Edwards v Giudice (1999) 94 FCR 561 [6]‒[7].

 33   Budd v Dampier Salt Ltd (2007) 166 IR 407 at [15]; with reference to Briginshaw v Briginshaw (1938) 60 CLR 336 and Neat Holdings Pty Ltd v Karajan Holdings Pty Ltd (1992) 67 ALJR 170 at 171.

 34   Streeter v TelstraCorp Ltd (2008) 170 IR 1.

 35   Exhibit A1 Document 3, 6.

 36   Ibid, 5.

 37   Exhibit R1, Responses to Applicant’s Contentions, [4].

 38 Ibid [16].

 39 Ibid, Responses to Applicant’s Contentions, [18]-[24].

 40   Ibid, Responses to Applicant’s Contentions, [14].

 41   Exhibit A6 Document 12, 6.

 42   Ibid, 12.

 43   Exhibit A5 Document 5.

 44   Exhibit R1, Responses to Applicant’s Contentions, [17].

 45   Exhibit R4, Documents 6 and 7.

 46   Chubb Security Australia Pty Ltd v Thomas Print S2679 [41].

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