McAlister v Yara Australia Pty Ltd

[2021] FCCA 1409

FEDERAL CIRCUIT COURT OF AUSTRALIA

McAlister v Yara Australia Pty Ltd [2021] FCCA 1409

File number(s):

SYG 463 of 2016

Judgment of:

JUDGE OBRADOVIC

Date of judgment:

25 June 2021

Catchwords:

INDUSTRIAL LAW – Contract of Employment – where employee was summarily dismissed – whether breach of contract – whether term of reasonable notice implied – remedies for breach

INDUSTRIAL LAW – Adverse Action Claim – whether contract of employment terminated for prohibited reason

INDUSTRIAL LAW – redundancy – whether applicant’s role made redundant

Legislation:

Fair Work Act 2009 (Cth), ss 117, 119, 340, 361
Federal Circuit Court Act 1999 (Cth), s 76
Federal Circuit Court Rules 2001, r 21.02

Cases cited:

Australian Blue Metal Ltd v Hughes [1963] AC 74
Banks & Banks [2015] FamCAFC 36
Boyd v Glenvill Pty Ltd [2021] FCCA 265
Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012] HCA 32
Brennan v Kangaroo Island Council [2014] HCASL 153
Bropho v State of Western Australia [1990] HCA 24
Byrne v Australian Airlines Ltd [1995] HCA 24
CAE Australia Pty Ltd v Zekants & Anor [2012] FWA 7992
CFMEU v Claremont Coal Pty Ltd (2015) 253 IR 166
Carrabba v PFP (Aust) Pty Ltd & Anor [2019] FCCA 2857
Elton v Bywater Medical Management P/L [2011] QDC 114
Flageul v WeDrive Pty Ltd [2021] FCAFC 102
Goldman Sachs JBWere Services Pty Ltd v Nikolich [2007] FCAFC 120
Guthrie v News Ltd [2010] VSC 196
Heldberg v Rand Transport (1986) Pty Ltd [2018] FCA 1141
Jones v Department of Energy and Minerals (1995) 60 IR 30

1           Jones v Dunkel [1959] HCA 8

Kuczmarski v Ascot Administration Pty Ltd [2016] SADC 65
Macauslane v Fisher & Paykel Finance Pty Ltd [2002] QCA 282
McGowan v Direct Mail and Marketing Pty Ltd [2016] FCCA 2227
Miller v Sunland Park Pty Ltd & Another [2014] FCCA 89
Mimmo v Fernando [2016] VSC 510
Nair v Queensland University of Technology, [2019] FCCA 1709
Pappas v P&R Electrical Pty Ltd [2016] SADC 132
Quality Bakers of Australia Ltd v Goulding and Another (1995) 60 IR 327
Rankin v Marine Power International Pty Ltd [2001] VSC 150
Russell v Institution of Engineers Australia t/a Engineers Australia [2013] FCA 1250
Kekeris v A. Hartrodt Australia Pty Ltd [2010] FWA 674
Richards v Nicoletti [2016] WAIRC 941
Stewart v Nickles [1999] FCA 888
Unsworth v Tristar Steering and Suspension Australia Ltd [2008] FCA 1224
Walton v Wollondilly Abattoirs Co Op Limited (1993) 50 IR 81
Westen v Union des Assurances De Paris (1996) 88 IR 259

Windross v Transact Communications Pty Ltd [2002] FMCA 145.

Number of paragraphs:

266

Date of last submission/s:

4 February 2020

Date of hearing:

12, 13, 14, 15 August 2019, 15, 16 October 2019 and 4 February 2020

Place:

Parramatta

Counsel for the Applicant: 

Ms Muir

Solicitor for the Applicant: 

Petrine Costigan Lawyers

Counsel for the Respondent: 

Ms Andelman

Solicitor for the Respondent: 

Holman Fenwick Willan

ORDERS

SYG 463 of 2016

BETWEEN:

JANELLE MCALISTER

Applicant

AND:

YARA AUSTRALIA PTY LTD

Respondent

ORDER MADE BY:	JUDGE OBRADOVIC
DATE OF ORDER:	25 JUNE 2021

THE COURT ORDERS THAT:

1.Within 14 days, the parties are to provide to the Court a short minute of order to give effect to these reasons.

REASONS FOR JUDGMENT

JUDGE OBRADOVIC

INTRODUCTION	[1]
BACKGROUND AND BRIEF CHRONOLOGY	[10]
THE IMPORTANT DETAIL	[43]
The early years at Yara with Mr Haugen	[43]
Ms McAlister’s Role: Responsibilities and Remuneration	[45]
Mr Marsh, Mrs Marsh, TransAction and Magellan Logistics	[54]
The Troubling Documents	[62]
TransAction Contract	[62]
Magellan Authority	[63]
The changes at Yara from February 2015	[66]
Yara’s Management Team	[88]
Ms Magnussen	[88]
Mr Sullivan	[90]
Mr Wiseman	[93]
Mr Terry	[94]
WHAT OCCURRED BETWEEN SEPTEMBER 2014 AND OCTOBER 2015 AND WHAT MS MCALISTER DID	[95]
THE ALLEGATIONS OF MISCONDUCT AND YARA’S INVESTIGATION PROCESS AND FINDINGS	[134]
COURT’S DETERMINATION: WAS THE RESPONDENT ENTITLED TO SUMMARILY TERMINATE THE APPLICANT’S EMPLOYMENT?	[151]
Summary Dismissal	[151]
Did Ms McAlister have authority to sign the TransAction Contract?	[154]
Did Ms McAlister have authority to sign the Magellan Authority?	[156]
Ms McAlister’s alleged conflict of interest	[158]
Did Ms McAlister’s Actions amount to Serious Misconduct?	[175]
NOTICE OF TERMINATION	[191]
Ms McAlister’s Contract	[191]
Implied Term of Reasonable Notice and Section 117 of the Fair Work Act 2009 (Cth)	[193]
How much notice should have been given to Ms McAlister?	[222]
REDUNDANCY	[236]
WAS THE APPLICANT TERMINATED FOR A PROHIBITED REASON?	[248]
WHAT DAMAGES FLOW?	[262]
COSTS	[266]
CONCLUSION	[267]

INTRODUCTION

1. The applicant, Ms Janelle McAlister (“Ms McAlister”) had worked for the respondent, Yara Australia Pty Ltd (“Yara”) for almost 19 years before her dismissal.

2. During the time she was employed, Ms McAlister held a number of different roles. She commenced employment as an Administration Manager, then Administration and Logistics Manager, then Administration, Logistics and Human Resources Manager, and finished off her employment as the Planning Co-Ordinator.

3. Ms McAlister was summarily dismissed from her employment on 16 October 2015.

4. On 2 March 2016, Ms McAlister commenced proceedings against Yara, alleging breach of contract and contraventions of the Fair Work Act 2009 (Cth) (“FWA”). Ms McAlister’s claim for relief has been amended numerous times and there have been a number of interlocutory applications along the way. The final hearing, which was originally listed for four days, took seven days of hearing time.

5. The key questions the Court is required to answer may be summarised as follows:

   (a)Was the respondent entitled to summarily dismiss the applicant?

   (b)If not, what period of notice of termination was the applicant entitled to?

   (i)Did the applicant’s contract of employment contain an implied term of reasonable notice of termination? If so, what was that reasonable notice period?

   (c)Was the applicant’s role made redundant?

   (d)Was the applicant’s employment terminated for a prohibited reason?

   (i)If so what damages, if any, flow? Penalty?

6. A word about the length of time it has taken to publish these reasons for judgment: all matters which come before the Court ought to be heard in a timely manner. The workload of this Court is such that this is almost an impossibility; not only to the detriment of the litigants who come before the Court but also to the detriment of the judicial officers who are charged with the task of determining the disputes which come before them.

7. As noted earlier, the final hearing took a total of 7 days of hearing time, almost twice the original estimated length. Those 7 days occurred over a year and half. The transcript was just under 650 pages, and the affidavits and exhibits in the hundreds of pages. The scattergun approach adopted to this litigation by the applicant was not particularly conducive to a quick outcome. While helpful, the written submissions were long and detailed, and the issues for determination in the proceedings requiring thought and careful deliberation.

8. These reasons for judgment do not detail every single piece of evidence and argument presented during the 7 days of hearing, although all such matters were carefully considered. Consideration does not mean discussion (Banks & Banks [2015] FamCAFC 36). The Court is well aware that the length of hearing herein is not an extraordinary occurrence in many other Courts, particularly superior Courts.

9. From when the hearing concluded to when judgement is to be delivered, the trial judge has finalised over 540 other matters and delivered over 150 judgments, both written and oral. All judicial determinations require reasons to be provided. None of this will of course be important to the parties, who deserve a timely determination to their dispute, which they have not here had. But, it is important to understand the pressure placed upon the Federal Circuit Court judges by their workload.

   BACKGROUND AND BRIEF CHRONOLOGY

10. In order to better understand what occurred, it is important to set out the general background of Ms McAlister’s employment with Yara.

11. Hydro Agri Australia Pty Ltd (“Hydro Agri”) was established in or about 1996. Hydro Agri was a subsidiary company of Hydro Agri International, a business unit of Norsk Hydro ASA in Oslo, Norway, a company listed on the stock exchange in Oslo, and at the time the world’s largest nitrogen fertiliser producer. Yara is part of the Yara group of global companies.

12. Between January 1997 and July 2004, Mr Stein Chingen Haugen was the Managing Director of Hydro Agri.

13. As part of the process of establishing the Hydro Agri business in Australia, in or about late 1996, Mr Haugen approached Ms McAlister to perform the role of Office Manager and Operations Manager.

14. On 11 November 1996, Mr Haugen offered Ms McAlister a position with Hydro Agri. The proposal was accepted by Ms McAlister and a contract of employment contract was subsequently signed by Ms McAlister and Mr Haugen on behalf of Hydro Agro.

15. Ms McAlister started working for Hydro Agri on 13 December 1996. On commencement, her base salary was $52,000.

16. In or around March 1997, Mr Bill Terry joined Hydro Agri as a sales agronomist.

17. In or around mid-2004, Mr Terry took over the role as the Managing Director of Yara from Mr Haugen.

18. On 15 March 2004, Hydro Agri changed its name to Yara.

19. From May 2009 to July 2016, Mr Steven Sullivan was employed by Yara Nipro Pty Ltd (“Yara Nipro”). In or around 2008 Yara purchased 40% of the issued capital of Yara Nipro and in or around 2011 purchased the remaining issued capital, thus becoming a 100% owner of Yara Nipro.

20. In 2012, Yara established its Management Committee. Ms McAlister was one of the original members of the Management Committee. She remained on that committee until 13 April 2015.

21. In or around June 2012, Mr Neill George Wiseman joined Yara Nipro as a Logistics Manager.

22. In late October 2014, Mr Adam Marsh from TransAction Customs & Forwarding Pty Ltd (“TransAction”) requested from Ms McAlister a contract with Yara to provide it with customs brokerage services.

23. In or around February 2015, Ms Henriette Magnussen was appointed as Managing Director of Yara Australia.

24. On 17 February 2015, the Management Committee met.

25. On 23 February 2015, Ms McAlister signed a contract with TransAction on behalf of Yara.

26. On 4 March 2015, all Yara staff members took part in an ethics training course.

27. On 5 March 2015, Mr Marsh on behalf of TransAction executed the contract with Yara, which Ms McAlister had signed on 23 February 2015.

28. In April 2015, there was a re-structure of Yara. The re-structure was announced at a Management Committee meeting on 10 April 2015. Ms McAlister, who was present at this meeting, learned for the first time that there were significant changes to her role and responsibilities. The changes were announced in the meeting, without any forewarning to Ms McAlister.

29. On 13 April 2015, Ms McAlister and Ms Magnussen had a meeting together to discuss the new workplace restructure. The following day, Ms Magnussen requested from Ms McAlister a copy of her signed contract of employment.

30. On 28 April 2015, Ms McAlister provided her employment contract dated 11 November 1996 to Ms Magnussen.

31. On or around 11 June 2015, Ms McAlister and Mr Sullivan had a meeting. Mr Sullivan informed Ms McAlister that Yara would be cancelling her salary sacrifice account.

32. On 22 June 2015, a new employee was appointed to perform payroll duties, a role previously undertaken by Ms McAlister.

33. In early July 2015, Ms McAlister had an appointment with a surgeon and organised to undergo back surgery on 23 September 2015. Mr Sullivan was advised of the date.

34. Also in early July 2015, Ms McAlister’s base salary was increased to $153,254.46, effective from 1 June 2015.

35. In mid to late July 2015, Ms McAlister’s mother passed away. Ms McAlister took two weeks leave. On 27 July 2015, Ms McAlister sent an email to Mr Sullivan regarding her back surgery, advising that she would be postponing the surgery and that she would check with Mr Sullivan before booking in the surgery again.

36. On 13 August 2015, Mr Sullivan held a meeting with Ms McAlister about changes to reporting line and restructured job roles. Mr Wiseman and Ms Karen Murphy were also present during this meeting. From this time, Ms Murphy was no longer a direct report to Ms McAlister.

37. Ms McAlister signed an authority on behalf of Yara on 14 September 2015, authorising Magellan Logistics Pty Ltd (“Magellan”) to be provided with electronic delivery orders in respect of a particular shipment.

38. At approximately 9.30pm on 13 October 2015, Mr Sullivan telephoned Ms McAlister and advised her that she was required to attend a disciplinary meeting in the morning to answer allegations of serious misconduct in her employment.

39. On 14 October 2015, Ms McAlister received a disciplinary letter from Mr Sullivan regarding a disciplinary meeting which was scheduled the next day. The letter noted the allegations against Ms McAlister.

40. On 15 October 2015, the disciplinary meeting occurred between Ms McAlister, Mr Sullivan and Ms Magnussen.

41. On 16 October 2015, Ms McAlister’s employment with Yara was terminated.

42. On 19 October 2015, Ms McAlister was issued with a letter of termination.

    THE IMPORTANT DETAIL

    The early years at Yara with Mr Haugen

43. Mr Haugen was initially tasked with setting up the Australian operation, which came to be Yara. In order to establish the Australian operation, he decided to hire Ms McAlister to assist him in setting up the Australian business. Mr Haugen wrote the contract of employment which Ms McAlister signed at the commencement of her employment with Yara. Mr Haugen also co-wrote the original Position Description for Ms McAlister’s role in January 1997.

44. According to Mr Haugen’s evidence, Ms McAlister was instrumental in the early years of the Australian operation.

    Ms McAlister’s Role: Responsibilities and Remuneration

45. As noted earlier, Ms McAlister was offered employment by Mr Haugen in November 1996. That offer of employment, which she ultimately accepted, was as follows:

    Employment Contract Proposal

    between

    Janelle McAlister

    and

    Hydro Agri Australia Pty Ltd

    dated

    Sydney, November 11^th, 1996

    Title:  Administration Manager

    Commencement:  January 1st, 1997

    Gross Salary:  A$ 52,000

    Annual year end bonuses:                   One Month Gross Salary

    Superannuation:  10%

    Leave Loading:  17.5%

    Vacation:  4 weeks annually

    Health Insurance:  Yes, details to be agreed upon

    Company car:  Yes, details to be agreed upon

    Mobile Phone/Private Phone:              Yes, details to be agreed upon

    All other details to be according to the rules and regulations set forth by the appropriate Australia government authority(ies) between employer and employee.

46. On or about 5 January 1997, Mr Haugen, in consultation with Ms McAlister, prepared a Position Description for Ms McAlister’s role, tilted “Administration/Operations Manager”. Included in the position description were the following:

    (a)The basic role function was described as “to be responsible for the administrative and operational functions of Hydro Agri Australia Pty Ltd”

    (b)Accountabilities included:

    (i)Arranging ordering of stock;

    (ii)Maintaining shipping schedule;

    (iii)Receipt and distribution of shipping documents. Dealing directly with customs clearance agents to ensure that the containers are cleared and delivered most cost efficiently;

    (iv)Arranging for collection of product from wharf and distribute to warehouse/customer depending on order type;

    (v)Arranging for release of product from our warehouses; and

    (vi)Arrange for payment of all invoices.

    (c)The role included human relations responsibilities.

47. From the commencement of her role at Yara, Ms McAlister was responsible for logistics, which she described in her oral evidence as:

    Organising the orders to be placed in Norway, receiving the shipment details, forwarding the documents to our broker and arranging for clearance of the goods, and delivery to the warehouse. And then sale of the goods on receipt of the order… Customers would order product…. I had arranged for the warehouse to release the goods. Sometimes the customer would collect them, and other times I would arrange for delivery to the customer.

48. Until April 2015, Ms McAlister’s role with Yara was wide and varied, and included many responsibilities. By way of example:

    (a)After Ms McAlister took on human resource responsibilities from early 1997, her duties included matters such as preparing contracts of employment, arranging company cars and other salary benefits for employees, signing warning and termination letters, salary increase letters, payment of all salaries, superannuation and reimbursement of expenses;

    (b)Ms McAlister was responsible for the approval and payment of invoices received by the business. She was also responsible for processing of all orders received to be released from warehouses, delivery of goods to customers, signing cheques, tax documents, car leases, contracts for customs brokers and warehousing providers;

    (c)Ms McAlister was responsible for regularly signing shipping line authorities to release goods to an agent authorising them to collect the goods on behalf of Yara and transport them to the required location. If containers were sold to customers whilst still on water, Ms McAlister was required to sign authorities for customs brokers in order to clear the goods through customs and arrange for collection of shipping containers; and

    (d)From 2012, Ms McAlister was part of the Management Committee.

49. Until April 2015, Ms McAlister had a very high level of autonomy and decision making responsibilities. The performance of the various responsibilities which were associated with her role, were by and large, left up to her. The documents she signed on behalf of Yara were done without requiring consultation with the Managing Director of Yara.

50. Over the entire period of her employment with Yara, Ms McAlister’s remuneration increased to include the following:

    (a)In early 1997, income protection and life insurance premiums;

    (b)In January 2009, Yara set up an expense account for Ms McAlister. By April 2015, Ms McAlister was able to claim back $14,000 per annum for personal and workplace related expenses incurred by her; and

    (c)Numerous salary increases, including in July 2015 and regular performance bonuses.

51. In June 2015, Ms McAlister’s salary sacrificing arrangement, with a value of $14,000 per annum, was cancelled by Yara.

52. As at the date of the termination of her employment, on 16 October 2015, Ms McAlister’s total remuneration consisted of the following:

Component of package	Amount per annum
Salary	$153,254.46
Superannuation	10%, being $15,325.45
Use of a company motor vehicle	Unquantified
Payment of costs associated with the motor vehicle, including costs of fuel and e-toll charges	$2,663 +$1,063 +2,882 =$6,608
Private health insurance	$3,872
Life and income protection insurance	$7,747
Payment of mobile phone and landline costs	Unquantified
Total of quantified items	$186,806.06

1. Ms McAlister in her pleadings claims that she was earning $191,200 per annum. This amount is accepted on the basis that the unquantified amounts referred to above would likely have exceeded $4,800 in any event.

   Mr Marsh, Mrs Marsh, TransAction and Magellan Logistics

1. Mr Adam Marsh is a licenced customs broker.

2. In or around 1998, Hydro Agri started using Victory International as a customs broker, which employed Mr Marsh from 2003.  In around 2007, Mr Marsh left Victory International and set up his own business, TransAction.

3. After approaching Ms McAlister with a quotation for TransAction to provide services of a customs agent to Yara, TransAction began work for Yara as a customs agent in about May 2007. It does not appear to be in contention that as at 2007, Ms McAlister had the authority to engage customs agents on behalf of Yara. TransAction was not Yara’s only customs broker.

4. Mrs Marsh was employed by Yara from July 2005 to 6 October 2015. She is married to Mr Marsh.

5. Mrs Marsh was a junior employee to Ms McAlister, and she reported to Ms McAlister until April 2015. Between April 2015 and October 2015, she was employed by Yara as the Customer Service Manager.

6. The personal relationship between Mrs Marsh and Mr Marsh, which started in or around 2006, was known to Yara. Mr Marsh attended Yara’s work functions as Mrs Marsh’s partner and later as her husband. Company employees had signed a wedding card for the couple, and the then Country Manager purchased the present on behalf of Yara. On 5 March 2015, Ms McAlister had sent an email to Ms Magnussen about the personal relationship between Mr Marsh and Mrs Marsh, and Mrs Marsh had personally introduced Ms Magnussen to Mr Marsh in or about March 2015.

7. At all relevant times that TransAction had been engaged by Yara as a customs broker, Yara had been aware of the personal relationship between Mr Marsh and Mrs Marsh.

8. In September 2015, TransAction was sold to Magellan, and Mr Marsh commenced working for Magellan at the same time. Mr Marsh referred to the sale of TransAction to Magellan as a “merger” and this is how Magellan described the transaction to the market.

   The Troubling Documents

   TransAction Contract

9. A document titled “Service Contract” which bears the date 26 November 2014, and which was signed by Ms McAlister on or about 23 February 2015 and by Mr Marsh on or about 5 March 2015 (“the TransAction Contract”) in circumstances described in detail later in these reasons, is the document which formed the bases of some of the allegations of serious misconduct against Ms McAlister.

   Magellan Authority

10. The “Magellan Authority” also referred to by Yara as the “Letter of Authority” is a document, bearing the confusing heading “Electronic Import Delivery Orders (EIDO)” which authorises Magellan Logistics as Yara’s “agents” to receive on its behalf from the shipping company electronic delivery orders to the specified email addresses.

11. Ms McAlister signed the Magellan Authority on behalf of Yara on 14 September 2015.

12. The signing of the Magellan Authority by Ms McAlister in circumstances described in detail later in these reasons, formed the bases of some of the allegations of serious misconduct against Ms McAlister.

    The changes at Yara from February 2015

13. By 2013 and/or 2014, the business Yara conducted was collapsing. Ms Magnussen was tasked with improving the health of the business in terms of its efficiency and profitability.

14. Ms Magnussen commenced at Yara on 1 February 2015. At the time, Ms Magnussen had close to 20 years of experience working in the Yara group of global companies.

15. Ms Magnussen was given approximately two and half months to complete a review of the business, and this process involved a review of Yara’s operations and collecting information about how the business was conducted. As part of the process, Ms Magnussen conducted one on one meetings with all of Yara’s employees and all of its customers.

16. Ms Magnussen, in conducting her review of the business, assessed the way in which Yara’s administrative systems and procedures were being implemented, and she thus became aware of some issues regarding those systems and procedures as well as with the performance of some of the managers responsible for several of those systems. Ms Magnussen says that she became aware of performance issues concerning Ms McAlister, although these performance issues had never been discussed with Ms McAlister.

17. During Ms Magnussen’s review of the business in her initial weeks at Yara, she observed that a lot of the administration tasks that were being completed by Ms McAlister were not being done in accordance with Ms Magnussen’s understanding of Yara’s standards. When she undertook a review of the payroll process, Ms Magnussen observed that there was no approval procedure in place in respect to any payroll made to employees. In Ms Magnussen’s view at the time, these issues demonstrated Ms McAlister’s mismanagement of Yara’s normal procedure for payroll and employee salaries. None of these issues were discussed with Ms McAlister.

18. Ms Magnussen also took issue with the way that Ms McAlister managed the supply chain and the supply team, but again did not discuss them with Ms McAlister.

19. In early March 2015, Ms Magnussen formed the view that what Ms McAlister had told her about Yara’s then employees watching a compulsory series of 12 videos was at odds with what the employees had told her about watching the same videos, and this “caused her to question” what she “was being told” by Ms McAlister. Ms Magnussen says that this incident “had a great impact” on her view of Ms McAlister’s performance.

20. Ms Magnussen says that:

    At the time the business was in need of a turnaround and due to my role in achieving that turnaround, I had no time to be the “nice girl” or socialise with staff. My focus was on achieving key business objectives.

21. After conducting a review of the business and Ms McAlister’s role and performance, Ms Magnussen formed the view that Ms McAlister could not continue to manage her role as Administration, HR and Logistics Manager going forward.

22. This opinion was reached after only one meeting with Ms McAlister in early February 2015 about what her role entailed, and thereafter without raising any issues (which were discovered by Ms Magnussen as part of her review process and which she refers to as “red flags”) with Ms McAlister to seek her input and/or clarification. Ms McAlister was never put on performance management.

23. As a result of the conclusions which Ms Magnussen reached at the completion of her review process of Yara’s business, discussions were had between Ms Magnussen and her manager Mr Rao Narasimha about a new structure which would be imposed at Yara. Mr Sullivan was also involved in these discussions, but a decision was reached by Ms Magnussen and Mr Narasimha. The restructure of Yara’s business model was to be announced at the beginning of April 2015.

24. On Friday, 10 April 2015, a Management Committee meeting was held. Mr Narasimha and Ms Magnussen discussed the key findings of Ms Magnussen’s review and investigations. As part of the presentation, a new organisational structure was revealed, which showed that Ms McAlister was no longer part of the management team, it named Ms McAlister at the head of “Planning” (which consisted of herself and Ms Murphy reporting to her) and reporting to Mr Sullivan. Ms McAlister thus became aware of the loss of her role as Administration, HR and Logistics Manager and her new “Planning” role. Ms McAlister’s role was changed immediately after the new structure was announced.

25. Ms McAlister was not told prior to the meeting about the changes to her role, including that she would no longer be part of the management team. Functions involving logistics, administration and HR were distributed to other managers as a result of Yara’s restructure brought about by Ms Magnussen’s review.

26. On the following Monday, 13 April 2015, Ms Magnussen met with Ms McAlister, where she apologised to Ms McAlister for the way the information came out at the meeting. Ms McAlister at this meeting, raised a number of concerns about her recent treatment by Yara.

27. In mid April 2015, Ms Magnussen took on the task of reviewing all of contracts kept by Yara, including all contracts of employment for Yara’s employees and commercial contracts with Yara’s providers. It was Ms McAlister who directed Ms Magnussen to a filing cabinet where all contracts were meant to be kept. Ms McAlister’s employment contract (and the TransAction contract) were not in the filing cabinet.

28. On 14 April 2015, Ms Magnussen requested a copy from Ms McAlister of her employment contract with Yara, which was provided by Ms McAlister on 28 April 2015, after a further follow up email from Ms Magnussen. This was done after the Management Committee meeting. At this stage Ms McAlister, had largely been stripped of the previous responsibilities she held.

29. From 13 April 2015:

    (a)Ms McAlister’s authority as a signatory to Yara’s bank accounts was removed by Yara;

    (b)Ms McAlister was removed from the Management Committee by Yara;

    (c)Ms McAlister was given the job title of “Planning Co-ordinator” although the role itself was yet to be formalised and determined;

    (d)Ms McAlister lost her five director reports; and

    (e)Ms McAlister was moved from a private office into the main/common area of the office, as part of an office layout restructure.

30. In her evidence, Ms Magnussen was also critical of Ms McAlister for not disclosing to her the salary sacrifice arrangement, on the basis that Ms McAlister did not specifically come out about it after the Management Committee meeting in February 2015, or at any time afterwards despite being asked to compile spreadsheets of Yara employees’ salaries and benefits on 9 March 2015 and again on 1 May 2015. It was Mr Sullivan who in June 2015, showed Ms Magnussen a letter from Mr Terry approving Ms McAlister’s $14,000 travel account. Once again, this apparent lack of disclosure was never raised by Ms Magnussen with Ms McAlister.

31. Ms McAlister’s evidence is that she did tell Ms Magnussen about the $14,000 travel account during the first meeting they had in February 2015. Even if she had said it to Ms Magnussen, it was not contained in writing in any of the information subsequently provided to Ms Magnussen as part of the overall information Ms McAlister provided in respect of payroll and as the HR manager. In any event, Ms Magnussen formed the view that the salary sacrifice arrangement was not appropriate, it was not normal or standard practice in Yara, and it was terminated in June 2015.

32. The responsibilities which were associated with Ms McAlister’s role clearly changed from the day her role changed. Importantly, according to Ms Magnussen, after the change in her role Ms McAlister was no longer responsible for, nor authorised to sign such documents as customs broker agreements, shipping line authorities and authorities for customer’s customs brokers, which she had authority to sign prior to the change in her role on 13 April 2015. It just so happened that no-one told Ms McAlister that.

33. Despite these matters, Ms Magnussen says that “I believe I always treated … [Ms McAlister] with respect and did not engage in any conduct towards her that was intended to humiliate or exclude her.”

34. Between 13 April 2015 and 16 October 2015, Ms McAlister did not have a great deal of work to do at Yara. Most, if not all of her responsibilities, had been stripped away and she was left with an empty title and no role description. She helped out where she could, and did what was asked of her from time to time. According to Mrs Marsh, Ms Magnussen “cut” Ms McAlister “out of things”, and she kept “chipping away” at Ms McAlister’s role, title and perks. Ms McAlister was devastated by the changes to her role, her loss of responsibilities and her lack of meaningful work.

    Yara’s Management Team

    Ms Magnussen

35. Ms Magnussen was a witness of some force. While described by the applicant as presenting as “strong minded, direct and lacking in warmth” not only are these descriptors unhelpful but they are used in a critical manner. Ms Magnussen is an accomplished, educated woman from another country whose mother tongue is not English. Her work ethic, educational background, professional acumen and experience, saw her appointed as the head of the Australian operation for Yara and tasked with the difficult brief of turning the struggling Australian operation around. Her shortfall was that she did not take sufficient time to learn the local culture and local workflow before she sought to impose the changes which she considered were necessary for the struggling business. Her approach meant that Ms McAlister was ultimately not treated with dignity and fairness.

36. Notwithstanding that she was a witness of some force, Ms Magnussen’s evidence was at times contradictory and self-serving.

    Mr Sullivan

37. Mr Sullivan’s last role at Yara was Australia’s Supply Chain Manager. He resigned from Yara on 31 July 2016.

38. Much was made at the hearing of the agreement reached between Yara and Mr Sullivan at the conclusion of Mr Sullivan’s employment with Yara, that he would be paid long service leave even though he held no legal entitlement to such a payment. The payment of the moneys to Mr Sullivan was only to be made at the conclusion of these proceedings, notwithstanding that Mr Sullivan left the company in 2016. The payment to Mr Sullivan is a matter between Yara and Mr Sullivan. Even with the voluntary payment of long service leave by Yara to Mr Sullivan, the Court does not find on balance that the payment was promised as an incentive for Mr Sullivan to give favourable evidence to Yara’s case.

39. Mr Sullivan made a number of concessions during cross-examination. His oral evidence in general was evasive and highly qualified. Mr Sullivan was not an impressive witness.

    Mr Wiseman

40. Mr Wiseman’s oral evidence, was in certain regards, a radical departure from his evidence in chief. Importantly, Mr Wiseman’s evidence in chief was that if he was ever asked to sign a document, including a letter of authority, that it was his practice to always refer it to Mr Sullivan or Ms Magnussen for approval. In cross-examination, he conceded that the signing of documents, such as the Magellan Authority, was done without getting a manager’s approval, and that it did not matter who at Yara signed such documents as long as the cargo was taken off the wharf. Mr Wiseman was not an impressive witness.

    Mr Terry

41. Mr Terry was an impressive witness, and his evidence was measured and even. Mr Terry was not shaken on cross-examination about the payments made to him under the separation deed upon his departure from Yara. The Court does not find that the payment was promised as an incentive for Mr Terry to give favourable evidence to Yara’s case.

    WHAT OCCURRED BETWEEN SEPTEMBER 2014 AND OCTOBER 2015 AND WHAT MS MCALISTER DID

42. On 28 October 2014, Mr Marsh sent Ms McAlister an email which read in part:

    …With the leaving of Bill it worries me a lot as to who will be coming in and whether they will be in favour of Transaction compared to the other two Brokers Yara uses. Is there any chance of setting up a 12 month contract? Not that it means anything really but may sway us over the line incase (sic) they saw it differently?

43. Approximately 15 minutes after receiving this email, Ms McAlister responded with:

    Absolutely no problem with a contract. I do not foresee any issues though. I will call you this afternoon to discuss.

44. In her oral evidence, Ms McAlister explained that the email she sent to Mr Marsh on 28 October 2014, was not an indication that there would be no problem with signing the contract, but rather that she would discuss the matter with Mr Terry and that she did not foresee any issues, “meaning that Henriette was coming in; I would discuss it with Bill and come back to [Mr Marsh].”

45. Ms McAlister’s evidence is that at or around this time, she had a conversation with Mr Terry in relation to Yara signing a further contract with TransAction, and that Mr Terry had indicated his agreement to such a further contract.

46. Mr Terry does not have any specific recollection of having a conversation with Ms McAlister about the proposed contract with TransAction nor does he remember authorising her to sign such a contract. It was Mr Terry’s understanding that Yara’s operations with TransAction and Mr Marsh were dealt with by Ms McAlister. Mr Terry gave Ms McAlister a high level of autonomy and let her manage the logistics of the business with little input from himself in that area. On this basis, Mr Terry stated that Yara may have had agreements that he could not remember or that he was not familiar with.

47. The Court accepts that Ms McAlister did have a conversation with Mr Terry in or about late 2014 about a contract between Yara and TransAction. Shortly after this conversation, Ms McAlister spoke to Mr Marsh and advised him that Mr Terry had indicated that he was happy for Ms McAlister to sign the proposed contract with TransAction. Ms McAlister was on leave in December and spent time in January in Norway.

48. On 17 February 2015, Mr Marsh sent Ms McAlister a further email which read:

    … I had this contract as we discussed last year, do you think it necessary to at least give me 6 more months at the least?

49. Ms McAlister replied on the following day:

    I wouldn’t worry about it too much. I will send you an email tomorrow with the signed contract.

50. The email from Mr Marsh had attached to it the unsigned “Service Contract” with the commencement date noted as 26 November 2014.

51. Ms McAlister did not reply or send Mr Marsh an email until 23 February 2015. In that email she advised Mr Marsh:

    I have signed the service contract – sorry for the delay and have given the original to Julia to take home with her. Can you in due course, send me a copy signed by you as well?

52. On the signed document which Ms McAlister sent to Mr Marsh she wrote the date “26.11.2014” underneath her signature. The words “Commencement Date: 26 November 2014” were already on the document when Ms McAlister signed it. Ms McAlister then sent the document bearing her original signature home with Mrs Marsh to be handed to Mr Marsh.

53. Mr Marsh subsequently returned a signed copy of the contract to Ms McAlister by email on 5 March 2015. He also inserted the date “26.11.2014” under his signature.

54. What is somewhat confusing is the evidence of the date of the TransAction Contract:

    (a)Ms McAlister says that she wrote the date on the contract being 26 November 2014, as this is when she recalls she had the discussions with Mr Terry about TransAction continuing on as Yara’s custom’s broker;

    (b)Mr Marsh’s evidence is that previous contracts with Yara had been made in about November and that he had used an earlier contract to prepare the draft contract, which is why it was dated November 2014. (It is not clear on the evidence what the particulars of any prior written contracts between TransAction and Yara were over the many years TransAction was engaged as Yara’s customs agent.)

55. At first glance, while the evidence of Mr Marsh appears to be in conflict with the evidence of Ms McAlister, the two explanations by Mr Marsh and Ms McAlister can be accepted side by side. The Court accepts Ms McAlister’s evidence that the date she wrote on the contract is approximately the period that she recalls having discussions with Mr Terry about the TransAction contract, which was also around the time that Mr Marsh said corresponded with earlier contracts. It is more likely though, that the reason Ms McAlister wrote that particular date on the contract is because this was the date that was noted directly above the space for her signature, which also coincided with the general timeframe when she had the conversation with Mr Terry. Such an inference is open on the evidence.

56. In order to sign the TransAction contract, Ms McAlister says that she had to print it out. It was her usual practice to place all contracts in the filing cabinet located in the logistics area which was located between where Mr Wiseman, Ms Murphy and Ms McAlister were located. Ms McAlister’s evidence is that because the signature on the contract is hers, she must have printed it out and in accordance with her usual practice, put it in the filing cabinet. No such contract was located in the filing cabinet when Ms Magnussen was conducing her review of Yara’s business.

1. The Court finds that Ms McAlister did not keep the original signed document in Yara’s filing cabinet, that she did not keep a hard copy of it for the purposes of Yara’s records, and that she did not print out the document which was emailed by Mr Marsh to her on 5 March 2015 to put into the filing cabinet. It is possible that the reason why the contract was not in the filing cabinet is because Ms McAlister omitted to put it there on purpose, however, this is not a finding which is made on the evidence, nor is it an inference which the Court is prepared to draw. It is more likely that Ms McAlister was careless about it and that Yara’s systems were not sophisticated enough to ensure that all records were kept properly.

2. As noted above, Mr Marsh sent Ms McAlister an email on 5 March 2015 attaching the TransAction contract executed by him. In that email he also said “Julia was a bit worried about the business relationship between Yara and Transaction after the ethics conference yesterday, would you mind informing Henriette so it doesn’t get messy down the track? I would do it myself but I’m sure at this point she doesn’t need to hear from me.”

3. Given that Ms Magnussen had told Yara employees at the ethics training on 4 March 2015, that if any of the staff members have or have had any potential conflict of interest, it was important that they reported it to Ms Magnussen, it is unclear why Mr Marsh thought it was Ms McAlister’s role to tell Ms Magnussen about Mrs Marsh and Mr Marsh. If anything, it was a matter for Mrs Marsh to disclose to Yara; which she did on 5 March 2015.

4. Later that day, on 5 March 2015, Ms McAlister sent an email to Ms Magnussen regarding Yara’s relationship with TransAction and the personal relationship that existed between Mrs Marsh and Mr Marsh. She did not inform Ms Magnussen about the contract she had received back from Mr Marsh.

5. Mr Marsh was not cross-examined about the content of this email of 5 March 2015. He was not asked to clarify what he meant by “would you mind informing Henriette so it doesn’t get messy down the track?” and whether he was asking Ms McAlister to inform Ms Magnussen about the relationship between him and Mrs Marsh or about the contract attached to his email, in light of his personal relationship with Mrs Marsh. Ms McAlister was asked some questions about how she interpreted what Mr Marsh wrote, and why she would tell Ms Magnussen only about Mr Marsh being married to Mrs Marsh, when this was something already well known at Yara, rather than also about the signed contract which she had received that morning back from Mr Marsh. It is clear from her evidence that she did not understand that she had to tell Ms Magnussen about the specific contract, but rather that she was obliged to tell her about the relationship between Mr Marsh and Mrs Marsh. Ms McAlister said that she did not believe the contract was “binding”.

6. On 6 March 2015, Ms McAlister emailed Mr Marsh advising him that she had forwarded information to Ms Magnussen and was waiting for a reply. It does not appear that anything further was done by Ms Magnussen about the disclosures from Mrs Marsh and Ms McAlister at the time.

7. In or around July 2015, Mr Marsh spoke to Mr Sullivan regarding TransAction merger with Magellan. Discussions were had in relation to whether Yara was intending to continue to use TransAction/Magellan as a supplier of customs brokerage services. Discussions surrounding Yara’s continuing relationship with TransAction were also had between Mr Marsh and Mr Wiseman at or around the same time.

8. On 7 September 2015, there were a number of emails between Ms McAlister and Mr Marsh regarding the merger of TransAction with Magellan. In early-mid September 2015, Mr Marsh emailed Mr Sullivan and Mr Wiseman advising them that TransAction was undergoing a merger with Magellan, and that the merger would be effective from 14 September 2015. In fact, Magellan bought TransAction on 8 September 2015.

9. On 14 September 2015, Mr Marsh approached Ms McAlister, via email, about getting the Magellan Authority signed. This was done by Mr Marsh in circumstances where he had been attempting to contact Mr Wiseman about being provided with the Letter of Authority but was not able to get a response from Mr Wiseman. TransAction already had the shipping documents, and it was asking for the shipping line authority with the new Magellan details noted on it, as by that stage, Magellan had already purchased TransAction.  

10. Ms McAlister, upon receiving Mr Marsh’s email, had a conversation with Mr Wiseman where she asked him if he wanted her to deal with the shipping line authority for Mr Marsh. Mr Wiseman answered indicating that it would be great if Ms McAlister did this. At around the same time, Mrs Marsh approached Ms McAlister via the internal messaging system, requesting Ms McAlister to sign the shipping line authority for Magellan. After signing the Magellan Authority, Ms McAlister sent it via email to Mr Marsh, and forwarded the same email to Mrs Marsh.

11. The Court does not accept Mr Wiseman’s evidence that he did not say to Ms McAlister “yes” when she asked him if he wanted her to look after the shipping line authority. It was after all, an insignificant part of Yara’s everyday transactional business and part of the tasks which administrative employees did regularly and without having to obtain their manager’s authority. The decision to terminate Yara’s relationship with TransAction had not yet been made and TransAction had already been engaged by Yara as its customs broker in respect of this shipment. Yara had already provided it with the Bill of Lading, invoices and associated documents with respect to this shipment. Had the Letter of Authority not been provided to Magellan, Yara would have incurred detention charges.

12. At or prior to this time, neither Mr Sullivan nor Mr Wiseman communicated with Mr Marsh that Yara would not be completing the authority that Mr Marsh had asked for, that Yara did not want Magellan to do any work for it or that Yara needed to run an integrity due diligence check (“IDD”)  on Magellan. Likewise, it had not been communicated to Ms McAlister that she no longer had authority to sign documents such as the shipping line authority document, which was an everyday administrative task at Yara, and undertaken by various staff members. It had also not been specifically communicated to her that Yara was very close to terminating its relationship with TransAction.

13. On or around 14 September 2015, Yara received an invoice from Magellan, which Ms Magnussen was asked to approve. Yara had already paid a previous invoice issued to it by Magellan. Yara had been informed by Mr Marsh that Magellan was the same company as TransAction, but that it just had a different name.

14. At around the same time, Yara determined that it would terminate its business relationship with TransAction. Ms Magnussen had formed the view that the rates which TransAction charged were high and that it had IT system limitations. Ms Magnussen had also previously formed the view, in March 2015 after the Yara ethics training, that Mrs Marsh being married to Mr Marsh, the owner of Yara’s “sole customs provider” created a conflict of interest.

15. On 17 September 2015, Mr Marsh sent an email to Mr Sullivan stating “… I am really struggling at the moment getting any sort of answer out of Neill, the last 4-6 weeks I have sent him many operational emails regarding day to day processes… after many weeks of being ignored I have resorted in requesting some of the required information from other staff members because I need it…”

16. On 1 October 2015, Yara wrote to Mr Marsh advising that “the management team of Yara Australia has decided to terminate its business relationship with TransAction/Magellan… The management decision for this change will be effectuated on the 5^th of October 2015.”

17. Upon receiving Yara’s letter of 1 October 2015, Mr Marsh responded with “Can you please confirm you are terminating the existing contract we have in place that expires 26/11/2015”. It was this communication from Mr Marsh that sparked the panic at Yara and in significant part resulted in an “investigation process” which saw Ms McAlister’s employment being terminated.

18. On 2 October 2015, Ms Magnussen becomes aware that TransAction and Magellan were being invoiced through different Australian business numbers (“ABN”). She contacted Mr Marsh as to concerns she had with the invoices.

19. After some investigation by Yara’s finance team, it became apparent upon checking the ABN on the Magellan invoice, that the ABN for Magellan was different to the ABN for TransAction and that Magellan was the new owner of TransAction. Ms Magnussen then entered into correspondence with Mr Marsh advising that Yara would not be paying any of Magellan’s invoices and asking for a refund of a previously paid invoice, on the basis that Magellan had not been approved by Yara as a customs provider.

20. Ms McAlister, on 2 October 2015, after being asked by Mr Sullivan about the contract with TransAction emailed Mr Sullivan and Mr Wiseman the contract she signed in February 2015. Her email read “Sorry I completely forgot about this – in fact I think that this was the first contract that he had. It was done before Bill left!”.

21. As noted earlier, the contract had not been signed before Mr Terry left, it was signed by Ms McAlister after Ms Magnussen started at Yara. It did however bear the date 24 November 2014.

22. By this stage, as is clear from the earlier findings, resulting from her review of the business Ms Magnussen had already formed an adverse view about Ms McAlister’s truthfulness and ability.

23. On 6 October 2015, Mrs Marsh resigned from Yara. She was observed by a co-worker to be “acting suspiciously and downloading material on to a hard drive… and then taking that hard drive off site with her” on that day.

    THE ALLEGATIONS OF MISCONDUCT AND YARA’S INVESTIGATION PROCESS AND FINDINGS

24. On 13 October 2015, Yara decided to conduct a search of Mrs Marsh’s computer. It was explained by Ms Magnussen that the decision to do this search was done “due to previous conflict of interest issues arising with Julia Marsh and TransAction… to see if Julia had downloaded any of Yara Australia’s confidential information on to her hard drive…”.  What Yara discovered were internal system messages and emails between Mrs Marsh and Ms McAlister, which after reading, made clear to Ms Magnussen’s mind, that Ms McAlister “had intentionally not informed Neill Wiseman that she had signed the letter of authority for Magellan and had tried to conceal the fact that she had signed the authority letter.” The discovery of the emails and messages on Mrs Marsh’ computer, made Ms Magnussen lose confidence in Ms McAlister and led her to conclude that Ms McAlister had failed to conduct an IDD for Magellan.

25. Importantly, the conclusions reached by Ms Magnussen about Ms McAlister’s actions and the motives attributed to them, were never put to Ms McAlister, nor was she asked to provide any explanation as to the contents and meaning of the emails and the messages between herself and Mrs Marsh. Ms McAlister’s apparent failure to conduct the IDD was likewise never put to her.  

26. On 13 October 2015, Ms Magnussen wrote to Ms Sharyn Larsen as follows:

    Janelle has signed a Authority Letter on behalf of Yara for the change from TransAction to Magellan without informing Neil or Steve. This is not her mandate to do and absolutely not acceptable. With this – I can’t see other conclusion than I need to terminate Janelle tomorrow morning. Please help me with what is needed?

    This in combination with not sharing the information about the signed contract with TransAction in November 2014, is a clear COI and lack of trust.

    … seems that there was more hidden to find and I have to react on this.

27. When Ms Magnussen was asked in cross-examination whether, by the email to Ms Larsen and others, she was communicating at that point that Ms McAlister’s employment will be terminated on the morning of 14 October 2015, Ms Magnussen said that is correct, and that she was asking Ms Larsen how to make sure Yara does “the right process around it.” Ms Magnussen’s evidence, when asked a very similar question soon afterwards, was that she had not already made the decision to terminate Ms McAlister’s employment at the time she sent the email to Ms Larsen. Ms Magnussen’s evidence is difficult to reconcile, and appears on its face to be contradictory. The better view, given the plain meaning of the words in the email and Ms Magnussen’s oral evidence, is that she had already made her decision about Ms McAlister.

28. On receiving this email, Ms Larsen communicated with Ms Magnussen about conducting an investigation process, and how this ought to be done.

29. The way that Yara first communicated its allegation to Ms McAlister that she had engaged in serious misconduct, was by way of a telephone call from Mr Sullivan to Ms McAlister in the evening of 13 October 2015. Mr Sullivan advised Ms McAlister that she was required to attend a meeting at 10am on the following day to answer questions about the alleged serious misconduct. After speaking to Mr Sullivan, Ms McAlister wrote an email requiring a letter from Yara of the agenda for the meeting she was required to attend, so that she could prepare herself.

30. On 14 October 2015, Yara wrote to Ms McAlister. The letter titled “Disciplinary Meeting” required Ms McAlister to attend a meeting with Ms Sullivan and Ms Magnussen on 15 October 2015 at 8am. The letter raised three specific allegations of misconduct, they were:

    1.That you signed a contract on the 26^th November 2014 on behalf of Yara Australia Pty Ltd and TransAction…. which you were not authorised to sign. You were not authorised to do so as you were neither the Country Manager or Managing Director. You were aware that the owner of the Company Mr Adam Marsh was the husband of your work Colleague Julia Marsh. The matter is considered to be serious misconduct…

    2.On or around the 17^th February 22015, Henriette Magnusson, Managing Director informed all members of the management team, which included yourself at that time, that any issues of an ethical or conflict of interest nature must be raised within a three week period. You did not advise Senior Management  of the contract you had signed and you did not make Management aware of the contract until you were asked by Neil Wiseman… on or around 2 October 2015. This matter is considered serious misconduct…

    3.That you knew that there was a merger planned between Magellan and TransAction and you knowingly signed a Letter of Authority for Magellan to take over the custom clearance operations on behalf of Yara .. Again you did not have authority to do so and you did not inform your Manager of Managing Director that you had signed such a letter. You were aware that it was… not intended for Magellan or TransAction to be awarded the new contract.

31. Ms McAlister replied back with the following, prior to the meeting on 15 October 2015:

    Point 1

    I did sign a contract with TransAction Customs on behalf of Yara Australia only after consultation with the then Managing Director, Mr Bill Terry. The contract was signed with the full support and approval of Mr Terry. Mr Terry was aware that we had conducted business with Mr Adam Marsh for nearly 15 years.

    I was unaware at this time that contracts had to be signed by a Country Manager/Managing Director. Since I had responsibility for logistical operations and decisions, I was unaware that this would be an issue.

    As far as I am aware, contracts were looked at and no issue was found.

    Point 2

    Contrary to this allegation, I informed Henriette Magnussen that Julia Marsh was married to Adam Marsh and explained to her that Adam Marsh had done business for the company for the last 15 years. The advice was provided to Henriette Magnussen in her room by me within the 3 week time period.

    At the time, Julia Marsh had also told me that she had spoken to Henriette Magnussen to advise she was married to Adam Marsh and wanted to check that this would not be a conflict of interest. Henriette Magnussen had advised Julia Marsh that it would not be.

    As referred to in 1. above, Mr Bill Terry was aware that I had signed the contract with TransAction Customs.

    This allegation is without foundation in substance or in fact.

    Point 3

    I was aware of a planned merger between Magellan and Transaction.

    I received an email from Adam Marsh asking me to complete and sign the letter of authority to the shipping line in order to be able to clear containers with documentation that TransAction was already in possession of. Adam Marsh had tried several times, unsuccessfully to contact Neill Wiseman to obtain the letter of authority. I asked Neill if he wanted me to look after it since he was busy to which he replied yes.

    To sign these documents is an everyday operational issue and there has never been any question of my authority to sign such documents. I have never informed Management, as it is a day to day issue however the signed documents are available in the filing cabinet in the middle of the office and can be looked at anytime by anyone.

    The authority that I signed was not an award of a new contract. It was an authority only to clear containers for which TransAction already had the documentation to clear and to avoid to the company paying any detention charges.

    The allegation is without foundation in substance or fact.

    I am concerned that these allegations have been made against me after nearly 20 years of blemish free employment. I am now 54 years of age and am concerned at reports that the company may be seeking to employ a younger workforce. I reserve all my rights in relation to remedies against the company that I may have including remedies in relation to my treatment during this year.

    (emphasis in original)

32. Ms McAlister attended a meeting with Mr Sullivan and Ms Magnussen on 15 October 2015. Following that meeting, Ms McAlister’s employment was terminated. Ms Magnussen says that her decision to terminate Ms McAlister’s employment was made taking into consideration her responses at the disciplinary meeting.

33. Ms Magnussen believed Ms McAlister was lying at the meeting on 15 October 2015, when she answered the question did you sign the Magellan Authority with “No I only signed the EIDO”. Due to Ms McAlister “denying that she signed a letter of authority, no further questions were asked” of her at the meeting. Ms Magnussen said in her oral evidence that she had understood Ms McAlister’s position to have been that she had signed the Magellan Authority, further questions would have been asked of her during the meeting. This in in conflict with her evidence in chief, where she indicated that the EIDO and the Magellan Authority were the one and the same, and that she had understood Ms McAlister to be talking about the same document (because the Magellan Authority bore the heading “Electronic Delivery Orders (EIDO)”).

34. Ms McAlister says, in any event, that she did not say to Mr Sullivan and Ms Magnussen that she had not signed the Magellan Authority, she had referred them to her written answers. Her written response provided the previous day was that she had received an email from Mr Marsh asking her “to complete and sign the letter of authority to the shipping line in order to be able to clear containers with documentation that TransAction was already in possession of… the authority that I signed was not an award of a new contract. It was an authority only to clear containers for which TransAction already had the documentation to clear and to avoid the company paying any detention charges.”

35. Even if Ms McAlister had said to Mr Sullivan and Ms Magnussen that she had signed an EIDO, this should have peaked Mr Sullivan’s and Ms Magnussen’s interest, not only because the Magellan Authority was not itself an EIDO, but rather an authority for Magellan to obtain EIDOs, but also because such an answer was clearly inconsistent with Ms McAlister’s written response. To not ask for a clarification or any further questions after being given this answer, speaks of a lack of willingness to engage in a meaningful process with Ms McAlister about putting the allegations to her fairly and openly. This is so, particularly when coupled with the fact that Ms McAlister was not provided with the documents which were obtained upon Yara’s search of Mrs Marsh’s computer nor was she asked any questions about them.

1. Ms Magnussen did not show Ms McAlister the documents she had discovered after the search of Mrs Marsh’s computer was conducted, because she did not want Ms McAlister to be given material that could help her explain the circumstances in which she signed the documents.

2. It was never put to Ms McAlister that the TransAction Contract was not signed by her in November 2014 nor was her explanation sought as to why the contract bore that date, despite the fact that Yara had in its possession at the time, emails between Ms McAlister and Mr Marsh which gave a time frame to the signing of the document. There was an innuendo that Ms McAlister had “backdated” the TransAction contract in Yara’s questions. Ms McAlister was not asked any questions about the emails or to explain when she actually signed the contract, nor why she signed the contract when she did. Instead, assumptions were made by Yara that Ms McAlister’s actions were dishonest and that she put the interests of TransAction/Magellan ahead of those of Yara. It was not put to her, for example, that from Yara’s point of view it looked like she was trying to help Mr Marsh when she knew that TransAction was on the way out.

3. At hearing, the respondent’s case was that Yara was not concerned about the apparent denial of Ms McAlister that she signed the Magellan Authority, but rather her lack of authority to execute the document and the transparency around it, which is said to constitute part of the serious misconduct which Ms McAlister engaged in. It seems from her oral evidence that Ms Magnussen was concerned about Ms McAlister’s apparent denial.

4. On 19 October 2015, Ms McAlister was issued with a letter dated 15 October 2015, referring to the allegations and concluding that

   A full investigation was undertaken in relation to these allegations against you and having reviewed the evidence provided during the investigation we believe that you have deliberately and knowingly acted in a manner which breaches our Yara Code of Conduct and Ethics.

5. Yara further determined that given Ms McAlister’s length of service “we will honour your notice and statutory payments accordingly” and paid Ms McAlister 5 weeks’ pay in lieu of notice and her other statutory entitlements. Yara also denied Ms McAlister’s allegation that the company “may be seeking to employ a younger workforce” and considered it as an attempt by Ms McAlister “to deflect from your own misconduct by making a completely unsubstantiated statement in this manner.”

   COURT’S DETERMINATION: WAS THE RESPONDENT ENTITLED TO SUMMARILY TERMINATE THE APPLICANT’S EMPLOYMENT?

   Summary Dismissal

6. The parties agree that the contract of employment could be terminated summarily for serious misconduct. This is because a breach of contract of employment by the employee may entitle the employer to terminate the contract without notice. There is no rule of law that defines the degree of misconduct which would justify dismissal without notice. The question whether the breach of contract justifies dismissal without notice is a question of fact. The onus of proof rests on the respondent: Rankin v Marine Power International Pty Ltd [2001] VSC 150 (“Rankin”) at [242]-[243]. The authorities establish that the breach of contract must be of a serious nature, involving a repudiation of the essential obligations or actual conduct which is repugnant to the relationship: Rankin at [250].

7. Yara, in its outline of opening submissions, says that the factual reasons for the commencement of the investigation and the decision to terminate can be characterised as a view formed by the respondent that there had been a breach of trust and confidence because of a failure to disclose the circumstances surrounding the creation and the existence of the TransAction contract and the conflict between Ms McAlister’s duty to Yara and her apparent interest in assisting Mr and Mrs Marsh with their new financial interest in Magellan.

8. Furthermore, Yara submits that Ms McAlister’s conduct, did amount to a sufficiently serious breach of her obligations to Yara to be honest, to act in the best interest of Yara and to act in a manner that did not cause a conflict of interest.

   Did Ms McAlister have authority to sign the TransAction Contract?

9. At the time of her decision in or about late November 2014, to agree to a contract with TransAction, Ms McAlister had been using TransAction for the bagged product exclusively. Ms McAlister was the Logistics Manager with authority to enter into such contracts.  In any event, she had spoken to Mr Terry about it.

10. At all relevant times, Ms McAlister did have authority to enter into the TransAction contract.

    Did Ms McAlister have authority to sign the Magellan Authority?

11. Yara had never communicated to Ms McAlister that she needed the Managing Director’s authorisation to sign the document in question, or documents of that kind on behalf of Yara. It had been part of Ms McAlister’s role for as long as she had been at Yara, to sign such documents as these were usual and everyday tasks, for not only her, but a number of Yara’s employees.

12. At all relevant times, Ms McAlister did have authority to sign the Magellan Authority.

    Ms McAlister’s alleged conflict of interest

13. The relationship between Mrs Marsh and Mr Marsh was not a secret.

14. Following Ms Magnussen starting at Yara in February 2015, Mrs Marsh personally introduced Mr Marsh to her, explaining TransAction’s business relationship with Yara, something which Ms McAlister also did in early March 2015. Ms McAlister had advised Ms Magnussen about TransAction carrying on work for Yara and that Mr Marsh was married to Mrs Marsh.

15. In any event, it was a matter which was well known at Yara, and it was a matter that was known by Yara at all relevant times when TransAction had been providing customs brokerage services to Yara. It was a matter known by Mr Sullivan, Mr Wiseman and Mr Terry. It was not Ms McAlister’s secret. It was also not Ms McAlister’s secret that TransAction had been providing brokerage services to Yara, or that as the Logistics Manager she was responsible for deciding who provided those services.

16. At the time that she agreed to a new contract with TransAction on behalf of Yara, TransAction had already for years been performing the same services for Yara. It was a trusted and known customs broker to Yara. The agreement did not change the relationship between Yara and TransAction. The evidence suggests that there were from time to time written agreements between Yara and TransAction, but there is certainly no evidence that all of the work which TransAction completed for Yara was pursuant to particular written contracts as existed from time to time.

17. There is no evidence that the TransAction Contract caused damage or loss to Yara. TransAction provided customs brokerage services to Yara both prior to November 2014, and between November 2014 and February 2015. It continued to provide such services after February 2015 until November 2015. Nothing had changed as a result of the TransAction contract.

18. It is clear on the evidence that what really upset Ms Magnussen in October 2015 was learning that on 5 March 2015, the same day that she received the executed contract from Mr Marsh, Ms McAlister did not advise her about it, even though she emailed her about TransAction explaining its long standing commercial relationship with Yara and the personal relationship between Mr Marsh and Mrs Marsh. Rather Ms Magnussen found out about the contract from Mr Marsh at the time that she attempted to sever that commercial relationship months later. This did not go down well with Ms Magnussen; that she had not known about the TransAction Contract when she tried to terminate Yara’s relationship with TransAction. The inference that Ms Magnussen was personally and professionally embarrassed by what had happened is clearly open on the evidence.

19. Had Ms Magnussen asked Ms McAlister in early October 2015 when she learnt about the contract, or at any time thereafter including at the disciplinary meeting on 15 October 2015 (or had Mr Sullivan asked her about it) why Ms McAlister did not tell her about the TransAction contract earlier she might have been told by Ms McAlister that it was in fact not a big deal. That is, that Ms McAlister did not see anything important or unusual about the contract, given her significant autonomy and managerial responsibilities at the time she agreed to it and at the time she signed it.

20. Ms McAlister was never specifically asked if there had been any written contract between TransAction and Yara, had she been asked she likely would have provided the information to Ms Magnussen and/or Mr Sullivan.

21. While the TransAction contract had not been filed in the filing cabinet, the Court does not accept the submission that Ms McAlister was even remotely dishonest in not keeping the original. When she was asked to provide a copy of it, Ms McAlister conducted a search of her computer and located a copy of it, which she then provided to Yara.

22. The Magellan Authority, was an everyday transactional document for Yara, it was like many other documents which went through its office to enable it to sell its product on the Australian market. It was a type of document which was signed by administrative staff on an everyday basis. The reason why Ms McAlister signed it is because she was asked to do so by Mr Marsh, in circumstances where she had run it past Mr Wiseman, and he told her to take care of it. At the time she was assisting Mr Wiseman and Ms Murphy, because as the Planning Co-ordinator, she still had no work to do. Had she not signed the Magellan Authority, Yara likely would have suffered a financial detriment.

23. In September 2015, when she signed the Magellan Authority, Ms McAlister’s actions benefited Yara.

24. The submission that Ms McAlister put TransAction’s interests ahead of Yara’s is simply not made out on the evidence.

25. At its highest, what Ms McAlister did, was that in late 2014 she decided that it was in Yara’s interest to continue its relationship with TransAction and spoke to her manager about it. The use of TransAction as Yara’s customs broker had been a matter for which Ms McAlister had been responsible for years.

26. To use Ms McAlister’s words “contracts were looked at” by Yara’s management, that is, the fact of TransAction being Yara’s customs broker was well known, “and no issues were raised” over the years.

27. This was so until Ms Magnussen came into the business and decisions were made about terminating the TransAction relationship in October 2015. By that stage, Ms McAlister had been ousted from her management role and was not a participant in the decision making process about Yara’s commercial relationships.

28. Ms McAlister was fed little bits of information from time to time, like for example that Yara was in the process of reviewing its service providers. She was neither part of the management team nor in the loop about the decisions of Yara’s management team in relation to its review of customs providers. Ms McAlister was never specifically told what Yara’s review process was, whether any decisions had been made about customs providers, nor was she specifically told that there were any issues with either TransAction or Magellan.

29. It was certainly never clearly communicated to her, until after TransAction was notified of Yara’s decision, that Yara was terminating TransAction’s services.

    Did Ms McAlister’s Actions amount to Serious Misconduct?

30. Ms McAlister did what Ms McAlister had always done, she ensured that Yara’s business was done in an efficient and timely manner, at times without any formality even if perhaps, a little formality was due.

31. In signing the TransAction Contract, Ms McAlister did nothing more than to continue the already long standing professional relationship between Yara and TransAction. There is no suggestion that Yara suffered any loss or damage as a result of Ms McAlister’s actions.

32. In signing the Magellan Authority, Ms McAlister ensured that Yara did not suffer any loss as a result of a shipment for which it would have been liable to pay detention fees if the shipment had been left on the dock. There is no suggestion in Yara’s evidence that Yara had another customs agent who had been engaged by it in respect of that particular shipment or that it was intending to provide another customs agent with a letter of authority in respect of that particular shipment.

33. Ms McAlister responded to Yara’s letter on 14 October 2015. She attended the meeting on the morning of 15 October 2015, and provided responses which were consistent with her written responses. It was Yara who did not tell Ms McAlister about all of its concerns and conclusions which it had reached based on information which had not been passed to Ms McAlister.

34. It is clear from Ms Magnussen’s evidence that she took a very grim view of some of Ms McAlister’s actions and indeed her work performance generally.  This is particularly so when one considers Ms Magnussen’s email of 16 October 2015 to Mr Koh and Ms Larsen. In that email, Ms Magnussen appears to be irate at what she considered Ms McAlister’s wrong doing. It is also clear that Ms McAlister’s explanations were not believed, even though they are not only perfectly plausible but in line with Yara’s business practices and work flow over many years.

35. It was “after the key findings in the search” that Ms McAlister would “receive info of dismiss in the case of misconduct and will be informed this afternoon (the level of serious mis-conduct)”. It is apparent that the matters which Yara had discovered as a result of its investigation had never been put to Ms McAlister and her explanation about them was not sought, yet they formed the basis for findings by Yara that Ms McAlister had engaged in misconduct which was serious and that Ms McAlister had been dishonest in her dealings with Yara.

36. It is clear on the evidence as a whole and based on what occurred, that Ms Magnussen had already made up her mind that Ms McAlister’s employment was to be terminated and that the disciplinary interview was simply a motion which Yara went through as a matter of formality. Ms Magnussen’s evidence that whether Ms McAlister’s employment was terminated “depended on the response from Ms McAlister” at the disciplinary meeting is difficult to accept, given how the meeting was conducted and that not all relevant matters were put to Ms McAlister. If anything, given her view of Ms McAlister, all answers provided by Ms McAlister were considered through this particular lens.

37. In fact, Ms McAlister was not given a proper opportunity to explain many of the matters about which Yara drew negative conclusions about, such as for example the link messages and the suggestion that Ms McAlister was concerned with assisting Mr Marsh rather than doing the right thing for Yara.

38. It is clear that Ms Magnussen at the time Ms McAlister’s employment was terminated, did not understand the daily operational requirements of Yara. Had she understood this, she would have understood the consequences of the signing of the Letter of Authority and that the purported contract with TransAction was no more serious than the work which TransAction had to date been doing, with or without any written agreement. And she would have understood that Ms McAlister had authority to sign the documents in question.

39. The minor infractions of Ms McAlister such as not ensuring that the TransAction contract was in the filing cabinet or omitting to mention in her email to Ms Magnussen of 5 March 2015 that she had just that morning received the executed TransAction Contract or that she signed the Magellan Authority where Mr Wiseman had been remiss in doing so and in circumstances where Ms McAlister was aware that there was a review process being undertaken by Yara, certainly did not warrant the drastic action of being summarily dismissed.

40. Ms McAlister’s apparent failure to either conduct an IDD or to satisfy herself that Magellan had been an approved company through the IDD process, in circumstances where she signed the Magellan Authority again, might have been a minor infraction but certainly did not warrant her being summarily dismissed. In any event, this did not concern Ms Magnussen at the time she made the decision to terminate Ms McAlister’s employment.

41. Ms McAlister did not hide, or intend to hide, that she had signed the TransAction Contract and/or the Magellan Authority. Had she wanted to conceal them, it is highly unlikely that she would have produced a copy of the TransAction account the day that she was asked for it or that she would have included the email address of another employee, namely Mr Wiseman, on the Magellan Authority.

42. For reasons explained earlier, Ms McAlister did not put the interests of Mr Marsh, TransAction and/or Magellan ahead of those of Yara. She was at all times a loyal employee.

43. The question of whether, in the circumstances, Ms McAlister’s conduct involved a sufficiently serious breach of her obligations to Yara, and that it amounted to serious misconduct justifying termination of employment contract without notice is answered in the negative.

44. Based on what had occurred, Yara was not entitled to summarily dismiss Ms McAlister, and it thus wrongfully terminated Ms McAlister’s employment.

45. Ms McAlister’s claim for breach of contract is made out.

    NOTICE OF TERMINATION

    Ms McAlister’s Contract

46. Ms McAlister’s contract of employment, contained the following clause:

    All other details to be according to the rules and regulations set forth by the appropriate Australia government authority(ies) between employer and employee.

47. It was Ms McAlister’s understanding, at the time she entered into the contract of employment, that the rules and regulations meant the law as applied in Australia. She was aware that there was a law in relation to her entitlements as an employee. In answer to the question (in respect of Ms McAlister’s contract of employment) that “where there was no specific reference to an entitlement… that those entitlements would be pursuant to Australian law?”, Mr Haugen answered “Of course. Why would I break the law?”.

    Implied Term of Reasonable Notice and Section 117 of the Fair Work Act 2009 (Cth)

48. The question that arises in the present proceedings, is not only as to the interpretation of the actual contract of employment, but also whether a term as to reasonable notice of termination is to be implied or if such an implied term has been displaced by s.117 FWA.

49. Ms McAlister, if understood correctly, argues that on a proper construction of her contract, there is no express provision regarding termination on notice, and therefore it is submitted on her behalf, that the contract contains an implied term of reasonable notice. It is submitted on her behalf that s.117 has not displaced the common law term.

50. Yara argues that Ms McAlister’s contract of employment already contained an express term that requires workplace entitlements to be paid in accordance with Australian workplace laws. In the alternative, Yara argues that if the contract does not contain an express term as to notice of termination, then the implied term as to reasonable notice is the notice period as set out in the National Employment Standards (“NES”).

51. Section 117 provides that an employer must not terminate the employee’s employment unless the time between giving the notice and the day of termination is at least the period (the “minimum notice period”) worked out under sub-section (3), or the employee has been paid an amount in lieu of notice of at least the amount the employee would have received if he had continued working until the end of the minimum period of notice.

52. It is a well-accepted general principle that where parties have agreed to a contract of employment being of an indefinite duration, either expressly or by not fixing a term, then the invariable position is that the contract of employment can be lawfully terminated on notice (Neil & Chin, Modern Contract of Employment, Thompson Reuters, 2^nd ed at [10.30]).

1. The period of notice that is required to lawfully terminate the contract can be fixed either expressly or by implication (Neil & Chin, at [10.31]). The term of reasonable notice is implied by law (Byrne v Australian Airlines Ltd [1995] HCA 24 (“Byrne”) at [62]).

2. In Byrne at [13] and [27] their Honours Brennan CJ, Dawson & Toohey JJ held:

   [13]… In the absence of any provision in the award and of any express provision in the contract of employment the law would regard it as a legal incident of the contract that it should be terminable upon reasonable notice or summarily for serious breach…

   [27] … If that provision were not to preclude the implication of a term that reasonable notice be given, it might provide evidence of what constitutes reasonable notice at common law…

3. As the authors Neil and Chin note, “[t]his statement would appear to allow of the possibility that at least some awards providing for notice would not preclude the implication of a term requiring reasonable notice (Neil & Chin, at [10.44], emphasis in original). A similar view is also held by the authors of Macken’s Law of Employment (Lawbook Co, 8^th ed (2016)). This argument can be extended to a legislative provision providing for a “minimum” notice period.

4. Before a term can be implied into a contract of employment, it must be necessary and must not be inconsistent with an express term of the contract. The necessity which will support an implied term in law is demonstrated where, absent the implication, the enjoyment of the rights conferred by the contract would or could be rendered nugatory, worthless, or perhaps be seriously undermined (Byrne per McHugh & Gummow JJ at [71]).

5. The basic principle of statutory construction is that legislation is presumed not to alter common law doctrines (Bropho v State of Western Australia [1990] HCA 24 at [18]). Neither s.117 nor the Explanatory Memorandum say anything about that section displacing a common law right.

6. There have been a number of decisions from various Courts across the Australian jurisdictions, although the legal position as to whether s.117 ousts the implied term of reasonable notice, being a term implied at law, is still to be determined by a superior Court which is binding on this Court.

7. In it searches, the Court is aware of at least the following decisions specifically dealing with whether s.117 of the FWA displaced the common law term of reasonable notice:

   (a)Guthrie v News Ltd [2010] VSC 196 (“Guthrie”) where Kaye J held that s.117 provides only a minimum period of notice and therefore does not cast light on the appropriate period of notice in the factual circumstances of that case.

   (b)Kuczmarski v Ascot Administration Pty Ltd [2016] SADC 65 (“Kuczmarski”) where auxiliary Judge Clayton held that a term that employment may not be terminated except on reasonable notice is not implied into a contract of employment where s.117 applies.

   (c)Pappas v P&R Electrical Pty Ltd [2016] SADC 132 (“Pappas”) where Judge McIntyre held that a term as to reasonable notice was not required to give business efficacy to the plaintiff’s contract of employment because s.117 established his entitlement to notice.

   (d)McGowan v Direct Mail and Marketing Pty Ltd [2016] FCCA 2227 (“McGowan”) where Judge McNab held that s.117 of the FWA does not displace a right to reasonable notice when the contract of employment is silent on the question of notice.

   (e)Richards v Nicoletti [2016] WAIRC 941 (“Richards”) where the Full Bench of the Western Australian Industrial Relations Commission held:

   126. … it is apparent that s 117 is not intended to reduce or affect common law rights and obligations other than to augment the common law right to reasonable notice by establishing a floor that if breached constitutes by the employer a breach of the National Employment Standards.

   127. Alternatively, if and when s 117 read as a whole with regard to its object, underlying context, purpose and, in particular, in respect of the latter, its legislative history, it could be said an ambiguity arises as to whether s 117(2) excludes the operation of a common law implied term to give reasonable notice in the absence of an express term. By the use of the words 'minimum notice' in s 117 could be said to leave open the question whether the prescribed periods of notice simply provide for a floor or exclude a more beneficial entitlement to a period of notice (except where the parties to a particular contract expressly agree to greater period than specified in s 117).

   (f)Heldberg v Rand Transport (1986) Pty Ltd [2018] FCA 1141 (“Heldberg”) where White J identified that it was at least arguable that Kuczmarski and Pappas, did not have any regard to or at least not insufficient regard to the matters identified by Judge McNab in McGowan at [85]. Ultimately it was not necessary to determine the issue of the application of s.117 vis-à-vis the common law term of implied notice in the instance of that case.

   (g)Carrabba v PFP (Aust) Pty Ltd & Anor [2019] FCCA 2857 (“Carrabba”) where Judge Lucev declined to follow McGowan, on the basis that it was wrongly decided, instead following Kuczmarski holding that in the particular circumstances of that case the employees contract was effective and had business efficacy without implying any additional period of what would otherwise be reasonable notice.

8. Further, in Brennan v Kangaroo Island Council [2014] HCASL 153, the High Court refused a special leave application from a decision of the Full Court of the Supreme Court of South Australia on the basis that there was no need to imply a term of reasonable notice in circumstances where the employee was subject to the terms of an Award which prescribed particular notice periods to apply. The notice period therein was not expressed as a minimum period of notice.

9. The Court respectfully agrees with the comments in McGowan and Guthrie, that it is doubtful that Parliament intended that employees who served vastly different periods, such as 5 years as opposed to 20 years, would, by the enactment of s.117(2) be confined to receiving the exact same period of notice of termination, despite their widely different circumstances. (See also for example Stewart v Nickles [1999] FCA 888 where it was held that the then equivalent of s.117 (albeit couched in different terms) did not displace the more generous express contractual provision for termination by notice, nor an implied contractual provision for termination by reasonable notice. The Industrial Relations Court of Australia had expressed a similar view in Westen v Union des Assurances De Paris (1996) 88 IR 259 (“Westen”) although it had ultimately not decided the matter).

10. White J’s analysis of this issue in Heldberg at [95]-[106], in particular [105], is with respect, the correct approach to the question of how s.117 ought to be interpreted and the approach which this Court adopts. Respectfully, the Court herein does not agree with the analysis of s.117 in Kuczmarksi for the reasons identified in Heldberg at [105]. The Court respectfully declines to follow Carrabba for similar reasons.

11. As such, s.117 of the FWA does not displace the common law term of reasonable notice, such term being implied by law.

12. It is important to consider the actual wording of the contract of employment, which includes the following:

    All other details to be according to the rules and regulations set forth by the appropriate Australian government authority(ies) between employer and employee.

13. There was no evidence as to what the “rules and regulations” might have been at the time Ms McAlister commenced her employment with Yara, although there were some very brief submissions about it in on behalf of Yara.  Furthermore, while there was some evidence as to what Mr Haugen and Ms McAlister understood by that paragraph in the written document, and about newer contracts at Yara from Ms Larsen, very little was said in submission as to the objective meaning of that term.

14. The reference in the contract to “rules and regulations” is so vague and uncertain that it cannot be read in the way contended for by Yara.

15. In order for an express term to be incorporated by reference, the general principle is that a contract of employment incorporates as part of its express terms promises that are made in an extraneous source when a reasonable person in the position of the employer would conclude that the employee intended to be contractually bound by such promises (Neil & Chin at [5.51]).

    It is well established that if a reasonable person in the position of a promisee would conclude that a promisor intended to be contractually bound by a particular statement, then the promisor will be so bound. This objective theory of contract has been repeatedly affirmed as representing Australian law by the High Court. Thus, in Toll (FGCT) Pty Ltd v Alphapharm Pty Ltd [2004] HCA 52; (2004) 219 CLR 165, 179, the Court said:

    "It is not the subjective beliefs or understandings of the parties about their rights and liabilities that govern their contractual relations. What matters is what each party by words and conduct would have led a reasonable person in the position of the other party to believe. References to the common intention of the parties to a contract are to be understood as referring to what a reasonable person would understand by the language in which the parties have expressed their agreement. The meaning of the terms of a contractual document is to be determined by what a reasonable person would have understood them to mean. That, normally, requires consideration not only of the text, but also of the surrounding circumstances known to the parties, and the purpose and object of the transaction."

    (Goldman Sachs JBWere Services Pty Ltd v Nikolich [2007] FCAFC 120 at [23])

16. The starting point is the language of the contract, viewed in the relevant context and having regard to the purpose and object of the contract. It is clear on the evidence that the parties, at the time the contract was executed, intended to comply with the law. Neither Mr Haugen nor Ms McAlister were aware of what the specific legislative provisions might have been at the time, nor what precisely the “rules and regulations” were which were said to apply to the contract. Furthermore, it is difficult to read into the precise words of the contract, additional words to the effect “presently-existing and future” or similar, which would lead a reasonable person to believe that the parties intended to include by specific reference future legislation which may significantly reduce or alter one of the parties’ rights under the contract.

17. The better interpretation is that the contract is silent on notice and that it does not contain a clause in respect of termination on notice (which is consistent with the legal advice provided to Yara by its own advisers in October 2015).

18. As such, the contract contains the implied term of reasonable notice.

19. If the Court is wrong about this and the words “rules and regulations… set forth… by government authorities” mean legislation as applicable at the relevant time, then s.117 of the FWA would be relevant. Section 117 speaks of notice of “at least the period” referred to as the “minimum period of notice” being provided. As such, the contract contains an express provision for the minimum period of notice which Ms McAlister should have been given.

20. A term which expressly provides for a minimum period of notice leaves room for the implication of reasonable notice of a longer period. It is a question of construction (See Windross v Transact Communications Pty Ltd [2002] FMCA 145 at [57]-[58]; Richards at [97]; Guthrie at [197]).

21. There is nothing in the wording of the particular contract which would exclude the implied term of reasonable notice. It is implied as a matter of necessity, if the term was not implied given the different protections to employees offered by s.117 compared to the implied term of reasonable notice, the common law right to reasonable notice would be seriously undermined or rendered nugatory.

22. There is of course, an interpretation which is open to the Court which is different to the one urged upon it by the parties, and that is, that the contract includes an express term that the workplace entitlements were to be determined in accordance with, inter alia, the common law. An Australian Court may be interpreted as “a government authority” and a “rule” may be a rule of common law. If the contract was to be understood in that manner, then the contract would in effect contain an express term of reasonable notice.

23. The wording of the contract in question does not exclude the reading of both the legislation and the common law “rules” into the contract, as express terms. Indeed, there is no prima facie conflict between such clauses. Such a construction would provide for Ms McAlister to be entitled to a minimum period of notice in accordance with the NES and reasonable notice of termination in accordance with the common law.

24. Ultimately and on any proper reading of it, Ms McAlister’s contract of employment contains an implied term of reasonable notice of termination.

    How much notice should have been given to Ms McAlister?

25. The object of a term requiring the giving of reasonable notice to terminate a contract at will has been described as follows:

    The implication of reasonable notice is intended to serve only the common purpose of the parties. Whether there need be any notice at all, and, if so, the common purpose for which it is required, are matters to be determined as at the date of the contract; the reasonable time for the fulfilment of the purpose is a matter to be determined as at the date of the notice. The common purpose is frequently derived from the desire that both parties may be expected to have to cushion themselves against sudden change, giving themselves time to make alternative arrangements of a sort similar to those which are being terminated

    (Australian Blue Metal Ltd v Hughes [1963] AC 74 at [99], cited in Rogan-Gardiner v Woolworths [2012] WASCA 31 (“Rogan-Gardiner”) at [46]).

26. The length of the required notice in any case is a question of fact to be decided in the light of the objective circumstances as they exist at the time the notice is, or should have been, given (Rogan-Gardiner at [49], citing Macauslanev Fisher & Paykel Finance Pty Ltd [2002] QCA 282 (“Macauslane”)).

27. Considerations that may be relevant to the determination of the period of reasonableness are as follows:

    (a)the length of service of the employee;

    (b)the professional standing of the employee;

    (c)the employee's age;

    (d)the employee's qualifications and experience;

    (e)her or his degree of job mobility;

    (f)the expected period of time it would take the employee to obtain alternative employment;

    (g)the period it was likely, apart from the dismissal, that the employee would have continued in the employment;

    (h)what the employee gave up to come to the present employer (for example, a secure long-standing job);

    (i)the employee's prospective pension or other rights.

    (Macken at [9.40], citations omitted)

28. Ms McAlister was 54 years old when her employment had been terminated. She had been at Yara for 19 years by that time. Her period of employment is a significant factor.

29. The salary which Ms McAlister was receiving prior to her termination, was significant, not only for the role she was performing but also in comparison to other Yara employees.

30. While she enjoyed a high level of autonomy and responsibility, and had acquired a number of skills which were job specific, Ms McAlister’s experience was in a narrow area and not necessarily easily transferable. She did not and does not have any formal qualifications.

31. Ms McAlister worked for 19 years in a specialised field, with a relatively high salary after the many years she spent at Yara, for a mixture of administrative and managerial duties.

32. The circumstances of her dismissal created doubt about her integrity.

33. In the four years since her dismissal, Ms McAlister has had difficulty in obtaining comparable employment, not only in terms of level of seniority but also importantly in terms of remuneration. It is highly unlikely that Ms McAlister will be able to find similar employment to that which she enjoyed at Yara.

34. Despite the many complaints by Ms Magnussen in her evidence about Ms McAlister’s apparent performance issues, Ms McAlister was never approached about such alleged shortcomings nor was she placed on performance management. Ms McAlister’s evidence, which is accepted, is that she had every intention of remaining at Yara and to retire at age 62.

35. While the NES might theoretically be considered evidence as to what the reasonable notice is at common law (Byrne), the authorities which deal with the common law term of reasonable notice on termination, point to much more generous periods (see for example Guthrie at [197]). As such, the submission by Yara that if there is an implied term, then the reasonable notice is the minimum period of notice provided by s.117 of the FWA, is not accepted.

36. It is urged upon the Court by Ms McAlister, that in her particular circumstances a reasonable period of notice is either 18 months, or 15 months or 12 months. These periods are, in all of the circumstances, excessive.

37. In the exercise of the Court’s discretion, and after considering relevant and comparable authorities (see for example Rankin; Guthrie; Macauslane; Quinn v Jack Chia (Australia) Ltd [1992] 1 VR 567; Walton v Wollondilly Abattoirs Co Op Limited (1993) 50 IR 81; Ma v Expeditors International Pty Ltd; Susanna Ma v Expeditors Pty Limited [2014] NSWSC (per Nicholas J); Miller v Sunland Park Pty Ltd & Another [2014] FCCA 89 (at [219]-[220]); Elton v Bywater Medical Management P/L [2011] QDC 114; Mimmo v Fernando [2016] VSC 510 (at [337] ), the Court determines that the reasonable period of notice which was implied into Ms McAlister’s contract of employment is a period of 9 months.

38. The termination of Ms McAlister’s contract of employment in the circumstances was a breach of the obligation to provide reasonable notice. As such, Ms McAlister is entitled to damages in the amount she would have earned during the period of reasonable notice, less any amounts she actually received during that time.

    REDUNDANCY

39. Ms McAlister’s claim for redundancy is based on a premise that her employment ended on 16 October 2015.

40. Section 119(1)(a) of the FWA provides that:

    (1) An employee is entitled to be paid redundancy pay by the employer if the employee’s employment is terminated:

    (a) at the employer’s initiative because the employer no longer requires the job done by the employee to be done by anyone, except where this is due to the ordinary and customary turnover of labour …

41. Whether a redundancy has occurred has been described in the following manner:

    What is critical for the purpose of identifying a redundancy is whether the holder of the former position has, after the reorganisation, any duties left to discharge. If there is no longer any function or duty to be performed by that person, his or her position becomes redundant…

    (Jones v Department of Energy and Minerals (1995) 60 IR 304 at 308; see also Macken at [9.170]).

42. It has been accepted that an employee's position is redundant where the duties that go to make up that position are split up and spread amongst other employees. It is not necessary for the work to have disappeared altogether. Organisational restructuring may result in a position being abolished and the functions or some of them being given to another or split amongst others. (Quality Bakers of Australia Ltd v Goulding and Another (1995) 60 IR 327 at [332]-[333]).

43. There are two limbs to s.119(1), the fist being whether “the employee’s employment is terminated at the employer’s initiative” and the second being whether there was a termination “because the employer no longer requires the job done by the employee to be done by anyone”.

1. The issue as to whether termination is at the initiative of the employer under s.119(1) is plainly “a question of fact to be determined on the evidence before the Court or tribunal called upon to determine these question” (CAE Australia Pty Ltd v Zekants & Anor [2012] FWA 7992 at [11], cited in Nair v Queensland University of Technology, [2019] FCCA 1709 (“Nair”) at [112]).

2. In Nair, Judge Jarrett at [94] provided the following summary as to the matters which are relevant in assessing whether an employee’s job had ceased to exist for practical purposes:

   a) the examination of the position and whether or not it has been made redundant must be undertaken as a matter of substance, not form;

   b) the concept “cannot be applied in the manner of a mathematical formula ... fact that the duties attached to a position have changed or some responsibilities have been transferred to other positions does not establish that the position, or the occupant of the position, has been made redundant”: UGL Rail Services Ply Limited v Janik [2014] NSWCA 436 at [132].;

   c) the question may be approached by asking whether the position has been abolished or largely stripped of its functions (as a matter of substance, not form);

   d) to what degree this needs to be the case can be stated in various ways, including (according to UGL Rail Services Ply Limited v Janik (above)):

   i) where the change is so substantial that for practical purposes the position no longer exists;

   ii) where the position appears to continue (whether under the same or a different name) but the duties and responsibilities are so substantially altered that it is largely stripped of its functions; or

   iii) where the position is effectively emptied of duties and in reality abolished or has effectively ceased to exist or at least the duties had been fundamentally changed so as to largely strip it of its functions.

3. The test is whether the “job” previously held by Ms McAlister still existed after 15 October 2015 (see Kekeris v A. Hartrodt Australia Pty Ltd [2010] FWA 674 at [27]).

4. Prior to April 2015, Ms McAlister’s role of Administration, Logistics and HR Manager and had wide and varied responsibilities as described earlier in these reasons. Yara did not terminate Ms McAlister’s employment in April 2015. It offered her a new role which she accepted, by electing to continue her employment with Yara. The “job” which Ms McAlister performed until 13 April 2015, ceased to exist after that date. It was as at 13 April 2015, Ms McAlister’s job as Administration, Logistics and HR Manager was effectively made redundant. However, her employment was not then terminated.

5. An employee has no right to make a legal claim that their employment be terminated pursuant to s.119. Yara had no duty to dismiss Ms McAlister at the time it made her job redundant in April 2015 (Unsworth v Tristar Steering and Suspension Australia Ltd [2008] FCA 1224 at [27]).

6. At the time of the termination of her employment on 16 October 2015, there was no redundancy of Ms McAlister’s job. Her employment was terminated for reasons other than redundancy. Yara made no decision to terminate Ms McAlister’s employment in April 2015 or at any time afterwards on the basis of redundancy.

7. Ms McAlister’s claim for redundancy is not made out.

   WAS THE APPLICANT TERMINATED FOR A PROHIBITED REASON?

8. It was submitted on behalf of Ms McAlister, that the true reasons for her dismissal (being the adverse action) included Ms McAlister’s complaints and enquiries, her age and and/or her need for spinal fusion surgery and recovery time. It was also submitted that her negative treatment after Ms Magnussen’s arrival was also for reasons which included her complaints, age and back issues.

9. McAlister relies on a number of circumstantial matters leading to an inference that the true reason for Ms McAlister’s termination of employment was one or more of: her age, the fact that she made complaints and enquires about Yara’s treatment of her in her employment, or that she was going to have spinal fusion surgery and would require recovery time after the surgery, namely:

   (a)That the dismissal took place not long after Ms McAlister reminded Mr Sullivan that she would need to undergo surgery and that she would be off work for about six to eight weeks thereafter for recovery and Mr Sullivan’s less than positive reaction about these matters;

   (b)The trend towards older employees leaving Yara after Ms Magnussen took on her role;

   (c)That Ms McAlister made ‘complaints’ and ‘enquiries’ about her employment over a period of months leading up to the dismissal’; and

   (d)The fact that she had not engaged in serious misconduct or misconduct of any kind.

10. It was submitted on behalf of Ms McAlister that a failure to displace the resumption in s361 of the Act, enables Ms McAlister’s allegation of adverse action for a prohibited reason to stand as sufficient proof of that fact.

11. The task of a Court in a proceeding alleging a contravention by reason of adverse action is to determine, on the balance of probabilities, why the employer took adverse action against the employee, and to ask whether it was for a prohibited reason or reasons which included a prohibited reason. The adverse action will have been found to have been taken if the prohibited reason, or reasons including the prohibited reason, for the action was a “substantial and operative reason” for the employer taking adverse action against the employee. The test is whether adverse action has been taken because of a prohibited reason, which requires a causal link to be established between the adverse action complain of and the matters referred to in s.340 of the FWA (Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012] HCA 32 at [5], [104], [129], [140]; Russell v Institution of Engineers Australia t/a Engineers Australia [2013] FCA 1250 at [60], [63]).

12. The Court is required to examine the reasoning process employed by each person whose involvement had a material effect on the ultimate decision. If one or more of the reasons employed by one or more of them was a prohibited reason, that will impugn the ultimate decision (CFMEU v Claremont Coal Pty Ltd (2015) 253 IR 166 at [121]).

13. In Boyd v Glenvill Pty Ltd [2021] FCCA 265 at [348] Judge A Kelly, after considering the applicable authorities, with respect, usefully summarised the relevant propositions in respect of adverse action and s.361, which the Court has had regard to.

14. Recently, the Full Court of the Federal Court in Flageul v WeDrive Pty Ltd [2021] FCAFC 102 held:

    9. The legislative intent sought to be achieved by the Commonwealth Legislature by ss 360 and 361 is to “provide a balance between the parties to a workplace dispute by, first, establishing a presumption in favour of an employee who alleges that an employer had taken, or is taking, adverse action against him or her because of a particular circumstance or fact of the kind specified in any of ss 340, 346, 351 or 354 and, secondly, enabling the employer to rebut that presumption”: Rumble v The Partnership (t/as HWL Ebsworth Lawyers) [2020] FCAFC 37 at [33], (2020) 275 FCR 423 at 430-431 per Rares and Katzmann JJ (“Rumble”). Their Honours continued on to summarise the effect of these presumptions by stating that the “presumption and onus that ss 360 and 361(1) create are necessary because the employee cannot know or prove what was in the decision-maker’s mind when he or she took the adverse action.” The employer or decision-maker acting on its behalf who took the alleged adverse action, it was said, “must prove, as a fact, that none of his or her reasons for that action included as a substantial and operative factor any reason or intent that the Act proscribed…”: [2020] FCAFC 37 at [34], (2020) 275 FCR 423 at 431. In providing this summary, their Honours relied upon Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012] HCA 32, (2012) 248 CLR 500 (“Barclay”). In that decision, French CJ and Crennan J observed (inter alia) that it would be “extremely difficult to displace the statutory presumption in s 361 if no direct testimony is given by the decision-maker acting on behalf of the employer”: [2012] HCA 32 at [45], (2012) 248 CLR 500 at 517.

15. The detailed submissions made on behalf of Ms McAlister, list at some length the complaints or enquiries Ms McAlister made to Mr Sullivan and Ms Magnussen between April and October 2015. Both Mr Sullivan and Ms Magnussen deny that Ms McAlister complained in the manner alleged, although it is clear that Ms McAlister felt her employment was in jeopardy. The submission that adverse action was taken by Yara, in part, on the basis of these complaints is inconsistent with Ms McAlister’s own evidence of Ms Magnussen taking an instant dislike to her.

16. While Ms McAlister was 54 at the time of the termination of her employment, while she did suffer from back problems at the time, and while she had made some general complaints about her treatment, none of these factors were a reason or part of the reason for the termination of her employment, or any other adverse action alleged.

17. The decision to terminate Ms McAlister’s employment was arrived at by Ms Magnussen in circumstances explained earlier in these reasons. She had consulted with Ms Larsen, and through her had obtained information from Yara’s legal advisers, she had discussed the matter with Mr Sullivan, and others at Yara, in particular her managers, but ultimately the decision was hers and it was only reinforced by those discussions. None of those discussions featured Ms McAlister’s age, back problems or complaints.

18. It was a decision she made based on an erroneous understanding of Ms McAlister’s role and responsibilities, and with a view tainted by her mistrust of Ms McAlister. Ms Magnussen formed the view that Ms McAlister had engaged in serious misconduct and for that reason terminated her employment.

19. Even if a Jones v Dunkel [1959] HCA 8 inference is drawn, as contended for by Ms McAlister in respect of no evidence from those higher up in the managerial chain to Ms Magnussen, it does not change the factual findings already made. The inference would not assist Ms McAlister’s case.

20. The reason why the investigation process was conducted in the manner explained was not as a “cover up” for the real reason (ie a prohibited reason) for which Yara wanted to terminate Ms McAlister’s employment. It was done as a result of various matters, including some adverse conclusions which had been made about Ms McAlister’s loyalty and honesty.

21. Ms McAlister’s claim for adverse action is not made out.

    WHAT DAMAGES FLOW?

22. Given the Court’s findings about the breach of contract, that there was no redundancy and therefore no obligation to pay severance pay and no adverse action taken by Yara, the only matter left to determine is to assess the damages which flow from the wrongful termination.

23. As noted earlier in these reasons, the Court has found that Ms McAlister is entitled to a 9 month notice period. She was paid five weeks’ in lieu of notice.

24. Given the earlier findings that at the time of termination, Ms McAlister’s total remuneration package was $191,200, the payment in lieu of notice is to be calculated on her total package, plus any statutory entitlements over that same 9 month period less the amounts already paid.

25. Interest up to judgment should be paid on the entire amount in accordance with s.76 of the Federal Circuit Court Act 1999 (Cth) at the rate specified in the Federal Court Practice Note GPN-INT, issued on 18 September 2017.

    COSTS

26. The parties are invited to make any costs applications pursuant to rule 21.02 of the Federal Circuit Court Rules 2001.

    CONCLUSION

27. For all of those reasons, orders as set out at the forefront of these Reasons for Judgment will be made.

267       I certify that the preceding two hundred and sixty six (266) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Obradovic.

Associate:

Dated: 25 June 2021