Minister Administering the State Service Act v Tasmanian Industrial
[2023] TASSC 10
•12 May 2023
[2023] TASSC 10
| COURT: | SUPREME COURT OF TASMANIA |
| CITATION: | Minister Administering the State Service Act v Tasmanian Industrial Commission [2023] TASSC 10 |
| PARTIES: | THE | HON | JEREMY | ROCKLIFF, | MINISTER |
ADMINISTERING THE STATE SERVICE ACT 2000
v
TASMANIAN INDUSTRIAL COMMISSIONAITKIN, Dean
| FILE NO: | 169/2023 |
| DELIVERED ON: | 12 May 2023 |
| DELIVERED AT: | Hobart |
| HEARING DATE: | 3 April 2023 |
| JUDGMENT OF: | Porter AJ |
| CATCHWORDS: |
Industrial Law – Tasmania – Industrial Commission – Jurisdiction and powers – Jurisdiction in respect of an industrial dispute relating to termination of employment – Where termination of employee made under State Service Act 2000 after a finding of a breach of Code of Conduct – Disputes in relation to termination under State Service Act to be dealt with by appropriate industrial tribunal in accordance with the legislation under which that tribunal established – Nature of hearing before Industrial Commission – Hearing not confined to a role akin to judicial review of finding of breach.
NSW Commissioner of Police v Cottle [2022] HCA 7, 96 ALJR 304, applied.
Cosco Holdings Pty Ltd v Thu (1997) 79 FCR 566, Qantas Airways Ltd v Cornwall (1998) 84 FCR 483, Patty
v Commonwealth Bank of Australia [1999] 179 ALR 57, Edwards v Giudice (1999) 94 FCR 561 considered.
State Service Act 2000, ss 10 and 50(4).
Industrial Relations Act, ss 29, 30, 31.
Aust Dig Industrial Law [3880]
REPRESENTATION:
Counsel:
Applicant : M Jehne First Respondent: No appearance Second Respondent: K Read SC, R Weiss
Solicitors:
Applicant: Office of the Solicitor-General Second Respondent: McLean McKenzie & Topfer
| Judgment Number: | [2023] TASSC 10 |
| Number of paragraphs: | 87 |
Serial No 10/2023 File No 169/2023
MINISTER ADMINISTRATING THE STATE SERVICE ACT v TASMANIAN
INDUSTRIAL COMMISSION and AITKIN
| REASONS FOR JUDGMENT | PORTER AJ 12 May 2023 |
| Introduction |
1 This is the return of a general order to show cause made pursuant to r 624 of the Supreme Court Rules 2000 directed to the Tasmanian Industrial Commission (the Commission). The applicant is the Hon Jeremy Rockliff in his capacity as the Minister administering the State Service Act 2000 (SSA). The Commission did not appear in these proceedings. Dean Aitkin was served with the general order as an interested party and appeared at the hearing through counsel. (I will refer to him as the respondent.)
2 The general order to show cause is in the following terms:
"…the Respondent must show why relief in the nature of a writ of prohibition or further or other relief should not be granted to restrain the Respondent from acting in excess of jurisdiction in relation to the hearing of matter T14912 Dean Jonathon Aitkin v Minister Administering the State Service Act 2000… which is currently before the Tasmanian Industrial Commission.
Ground of the application:
The … Commission proposes to act in excess of jurisdiction in relation to the hearing of matter T14912 of 2022 in that it proposes to conduct a merits review of the Secretary of the Department of Education's determination dated 8 November 2021 pursuant to s 10(3) of the State Service Act 2000 (Tas) that Mr Aitkin committed a breach of the Code of Conduct, where the Commission has no such jurisdiction."
3 The issue is the nature of the Commission's jurisdiction when hearing an industrial dispute relating to the termination of employment of a State Service employee following a finding by the Minister (or delegate) of a breach of the State Service Code of Conduct. That Code is set out in s 9 of the SSA and there is no need to detail any of it.
4 At the commencement of these proceedings, counsel for the applicant clarified the ground of the application. Although it refers to "merits review", it is intended to refer to a process described by the President of the Commission as a de novo hearing, with the Commission empowered to hear evidence to determine for itself whether there was a valid reason for termination and whether the termination was otherwise unfair. I understand this to mean, in general terms, that the Commission may make its own findings about whether relevant conduct occurred, if it is in issue. (I will continue to call this concept "merits review".)
5 The applicant contends otherwise, saying that the Commission's role in relation to the finding of a breach of the Code is in effect a supervisory one akin to judicial review. For the reasons that follow, I would discharge the general order to show cause.
Background
6 A short summary of the facts will suffice. Until 3 March 2022, the respondent was employed under the SSA as a teacher. In October 2009 he was tried and acquitted of the indecent assault of a
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student. On 7 September 2021 the Secretary commenced an investigation into whether the respondent had breached the Code of Conduct on the grounds of the allegations made in the criminal proceedings. On 8 November 2021, the Secretary determined that the respondent had breached the Code and later invited the respondent to show cause why termination was not an appropriate sanction.
7 Representations were made on the respondent's behalf but on 3 March 2022, the Secretary decided to terminate the respondent's employment, and he was notified accordingly. On 23 March 2022 the respondent applied to the Commission for a hearing in respect of an industrial dispute. Among the matters complained of in the application is that the Secretary only relied on a consideration of the trial transcript.
8 A preliminary issue arose as to the nature of the Commission's jurisdiction. The parties made submissions. In written reasons of 1 September 2022, supplemented by further reasons of 5 December 2022, the Commission President ruled that the hearing would be conducted in the form of a de novo hearing in the sense of a hearing "whereby the Commission is empowered to hear any evidence upon which the parties may wish to rely to determine for itself whether there was a valid reason for termination and whether or not the termination was otherwise unfair."
9 On 25 January 2023 the applicant applied for a general order to show cause. That order was made on 10 February 2023.
The general legislative scheme
10 I will provide an outline of the legislative scheme as it relates to the operation of both the SSA and the Industrial Relations Act 1984 (IRA), before returning to examine particular provisions. The relevant features of the legal landscape are as follows:
•
The Employer (the Minister) is to establish procedures for the investigation and determination of whether an employee has breached the Code of Conduct – s 10(3) of the SSA. (Implicit in this provision is a power in the Minister to investigate and make determinations.[1] In argument, counsel for the applicant referred to a finding of a breach as a "determination" under sub-s (3).)
•
The procedures referred to in subs (3) are to afford procedural fairness in relation to a determination of whether there has been a breach of the Code of Conduct (the Code) – s 10(4)(a) of the SSA.
•
Employment Direction 5 (ED5), established under s 10(3), contains procedures for the investigation and determination of whether an employee has breached the Code. If a Head of Agency has reasonable grounds to believe a breach of the Code has occurred, an investigation must be instigated.
•
The Minister may impose the sanction of termination of employment if an employee is found to have breached the Code – s 10(1)(g) of the SSA.
•
An employee is entitled to make application of the Commission for a review of any State Service action that relates to his or her employment in the State Service except in respect of the termination of the employee's employment – s 50(3) of the SSA.
[1] Cook v Beveridge [2003] TASSC 28; Secretary, Department of Health & Human Services v Beveridge [2004] TASSC
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•
Disputes in relation to the decision to terminate employment "are to be dealt with by the appropriate industrial tribunal in accordance with the legislation under which that tribunal is established." – s 50(4) of the SSA.
•
The Commission has jurisdiction to "conduct hearings for settling industrial disputes" – s 19(2)(c) of the IRA.
•
The Commission is to act according to equity and good conscience without regard to technicalities or legal forms, is not bound by the rules of evidence and may inform itself in such a way as it thinks just, and may regulate its own procedure which includes the power to summons people and take evidence on oath or affirmation – ss 20 and 21 of the IRA.
•
A former employee may apply to the President of the Commission for a hearing in respect of an industrial dispute relating to the termination of employment of the former employee – s 29(1A)(a) of the IRA.
•
An application for hearing in respect of a dispute relating to termination of employment must contain full particulars of the circumstances giving rise to the dispute and the nature of the claim – s 29(1D)(a),(e) and (f) of the IRA.
•
The employment of an employee who has a reasonable expectation of continuing employment must not be terminated unless there is a valid reason for the termination connected with the capacity, performance or conduct of the employee – s 30(3)(a) of the IRA.
•
Certain matters, not presently relevant to this case, are specifically provided for "without limitation" as not being valid reasons for termination – s 30(4) of the IRA.
•
Where an employer terminates an employee's employment, the onus of proving the existence of a valid reason for the termination rests with the employer – s 30(5) of the IRA.
•
Where an applicant alleges that his or her employment has been unfairly terminated, the onus of proving that the termination was unfair rests with the applicant – s 30(6) of the IRA.
•
The principal remedy in a dispute in which the Commission finds that an employee's employment has been unfairly terminated is an order for reinstatement or re-employment unless those things are impracticable – s 30(9) and (10) of the IRA.
The detail of particular provisions
11 As noted above, the section of the SSA that provides for reviews of "actions" is s 50. Materially, that provides as follows:
"50. Review of actions
(1) Subject to subsections (2) and (3) , an employee is entitled to make application to
the Tasmanian Industrial Commission for a review –
(a) of the selection of a person or an employee to perform duties other than duties to
be performed for a specified term or for the duration of a specified task; or
(b) of any other State Service action that relates to his or her employment in the State
Service.
(2) …
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(3) An employee is not entitled to make an application for a review
under subsection (1)(b) in respect of the termination of the employee's employment.(4) Notwithstanding anything contained in subsection (1) , (2) or (3) , disputes in relation to the decision to terminate employment are to be dealt with by the appropriate industrial tribunal in accordance with the legislation under which that tribunal is established."
12 The Commission derives its particular jurisdiction to conduct a review under s 50(1) from s 19AA of the IRA. That is in the following terms:
"19AA. Commission to review matters under section 50 of the State Service Act
2000
(1) The Commission is to review a matter in respect of which an application for
review has been made to it under section 50(1) of the State Service Act 2000 .(2) The Commission may refer any matter in respect of which an application for review has been made to it under section 50(1) of the State Service Act 2000 to the Ombudsman, the Integrity Commission or the Anti-Discrimination Commissioner or any other person or body that may be prescribed in the regulations.
(3) A person is not entitled to make application to the Full Bench of the Commission
in respect of a matter referred to in section 50(1) of the State Service Act 2000."
13 Section 29 relevantly reads as follows:
"29. Hearings for settling disputes
(1) An organization, employer, employee or the Minister may apply to the President
for a hearing before a Commissioner in respect of an industrial dispute…(1A) A former employee may apply to the President for a hearing before a
Commissioner in respect of an industrial dispute relating to –(a) the termination of employment of the former employee; or… (1D) An application for a hearing in respect of a dispute, including a dispute relating
to –(a) termination of employment; or …"
14 In determining industrial disputes relating to the termination of employment, s 30 of the IRA applies, the relevant parts of which are set out below.
"30. Criteria applying to disputes relating to termination of employment
(1) …
(2) In considering an application in respect of termination of employment, the Commission must ensure that fair consideration is accorded to both the employer and employee concerned and that all of the circumstances of the case are fully taken into account.
(3) The employment of an employee who has a reasonable expectation of continuing employment must not be terminated unless there is a valid reason for the termination connected with –
(a) the capacity, performance or conduct of the employee; or (b) the operational requirements of the employer's business.
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(4) Without limitation, the following are not valid reasons for termination of
employment:
(a) membership of a trade union or participation, or involvement, in trade union
activities;
(b) seeking office as, acting as, or having acted as, a representative of employees;
(c) non-membership of a trade union;
(d) race, colour, gender, sexual preference, age, physical or intellectual disability, marital status, relationship status, family responsibilities, pregnancy, religion, political opinion, national extraction or social origin, except where the inherent nature of the work precludes employment for any of those reasons;
(e) absence from work during maternity or parental leave;
(f) temporary absence from work because of illness or injury, provided that nothing in this paragraph is to be construed as removing an employer's right to terminate an employee's employment on account of persistent or unjustified absenteeism;
(g) the filing of a complaint, or the participation in proceedings, against an employer involving alleged violation of laws or regulations or recourse to competent administrative authorities.
(5) Where an employer terminates an employee’s employment, the onus of proving
the existence of a valid reason for the termination rests with the employer.(6) Where an applicant alleges that his or her employment has been unfairly terminated, the onus of proving that the termination was unfair rests with the applicant.
…."
15 The remedies on a finding of unfair dismissal are set out in s 30(9) and(10):
"(9) The principal remedy in a dispute in which the Commission finds that an employee's employment has been unfairly terminated is an order for reinstatement of the employee to the job he or she held immediately before the termination of employment or, if the Commission is of the opinion that it is appropriate in all the circumstances of the case, an order for re-employment of the employee to that job.
(10) The Commission may order compensation, instead of reinstatement or re- employment, to be paid to an employee who the Commission finds to have been unfairly dismissed only if, in the Commission's opinion, reinstatement or re- employment is impracticable."
16 The power to make orders of re-instatement or re-employment, or indeed orders in relation to anything that should be required to be done or action required to be taken, following a hearing, is found in s 31 – "Orders arising from hearings". The specific power to give effect to the remedies set out in s 30(9) and (10) is to be found in s 31(1B).
The applicant's contentions
17 The applicant's explanation of the effect of the contention advanced is that if the employer can establish a valid reason for the dismissal – bearing in mind the terms of s 30(4) – then the employee has to establish jurisdictional error. If that cannot be made out, the applicant says the employee would then have to persuade the Commission that the termination was disproportionate to the facts found under the SSA s 10 investigation, with that issue to be resolved on House v King principles.
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18 When dealing with the same submissions put to him, the Commission President described them as "novel", adding that if they were correct, it would result in "a significant departure from the previous practice of the Commission." (I assume he was referring to the Commission's general practice in relation to hearings relating to terminations of employment including those under the SSA.) Apart from a minor reservation to be later discussed, the applicant does not seem to take issue with the point about established practice.
19 The applicant says the case against a merits review is made out by three propositions. The first is the fact that the Secretary's determination under s 10 of the SSA that an employee has breached the Code of Conduct is an exercise of statutory power. That much is not in dispute, and must be correct. Quite how this assists the argument beyond the point that, as counsel for the applicant put it, "it invites an analysis of other legislation", is not clear to me. Obviously, the relevant parts of both the SSA and the IRA need to be looked at.
20 The second proposition is that the Secretary's determination that the respondent breached the Code of Conduct of itself constitutes a "valid reason for termination connected with [the respondent's] conduct", within the meaning of s 30(3) of the IRA. (As will be seen shortly, this is subject to the conceded caveat that the Commission can hear evidence about whether in fact, the true reason for the termination was one proscribed under s 30(4).)
21 The third proposition is that neither the SSA nor the IRA expressly or impliedly confer jurisdiction on the Commission to conduct "a merits review" of a determination of the Secretary made under s 10(3), and that the Commission therefore "has no jurisdiction to conduct a merits review or to substitute for the Secretary's determination, its own findings based on the evidence led in the Commission proceedings."
22 I will deal with the second and third propositions in turn.
The Secretary's determination a "valid reason" for termination?
23 On the applicant's argument, what is involved in the proposition that a finding of a breach of the Code of Conduct is of itself a valid reason for termination, without more, can be summarised as follows:
• The finding of a breach is a jurisdictional fact enlivening the powers of sanction under s 10(1) of the SSA. • The finding of a breach would not constitute a valid reason for termination if it is vitiated by jurisdictional error, something that is in the Commission's jurisdiction to detect. 24 In determining whether there is a valid reason for termination connected with conduct, in light of s 10 of the SSA, the Commission's task is to:
• Determine whether the power to terminate was enlivened by the existence of the jurisdictional fact of a finding; • Determine whether the finding of breach complied with the procedures established under s 10(3) of the SSA; • Determine whether, on all of the evidence, the reason for termination was the finding of a breach, rather than a reason proscribed by s 30(4) of the IRA.
25 The argument is that if each of those questions is answered in the affirmative, a valid reason for termination will be proven. The applicant says it follows from this analysis that a finding of a
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breach of the Code will constitute a "valid reason for the termination" (in this case connected with conduct) unless that finding is vitiated by jurisdictional error or the true reason was a proscribed one. Counsel submits that where the Commission is satisfied that a finding of a Code breach was the reason for termination, "it would then inexorably follow that there is a valid reason for termination connected with conduct.".
26 However, at the same time, the applicant accepts that the Commission can embark on a consideration what gave rise to the termination "in order to satisfy itself that one of the prohibited reasons in s 30(4) was not the motivating reason for the dismissal."
27 A difficulty with the broad proposition put is that it appears to me to have a high degree of circularity about it. It simply amounts to a statement of an essential part of the ultimate conclusion argued for. It does not address why the legislative scheme would operate to produce the result that a finding of breach is conclusive, subject to a process akin to judicial review and to the application of s 30(4) of the IRA.
The Commission's jurisdiction
28 The applicant says that neither the SSA nor the IRA expressly spells out what form a review under s 50(4) of the SSA should take. I am not sure that is right. The wording of s 50(4) may provide a good indication of what is contemplated, a matter to which I will return. In any event, the argument is that in the absence of any express jurisdiction to conduct a merits review, the employer bears the onus of proving the existence of a valid reason for termination "which goes to the legality of the Secretary's exercise of power to impose a sanction of termination for a proven breach, and a question of fact as to whether (if evidence is raised by the worker) a protected attribute was the real reason for termination." [Original emphasis in the written submissions].
29 Here again, the submission seems to beg the question; it attempts to support a claim based on a premise that simply restates or presupposes the correctness of the claim. It does not seem to advance the matter.
30 The applicant points out, correctly, that in construing the parameters of the Commission's jurisdiction, regard should be had to the presumption that statutes do not contradict one another, and in that respect, the principle that an Act of Parliament should be construed in a way that best achieves a harmonious result also informs the construction of two statutes which may share a field of operation. The applicant refers to Commissioner of Police for New South Wales v Eaton [2013] HCA 2, 252 CLR 2 at [78] per Crennan, Kiefel and Bell JJ; NSW Commissioner of Police v Cottle [2022] HCA 7, 96 ALJR 304 per Kiefel CJ, Keane, Gordon and Steward JJ at [23].
31 In Cottle, after setting out the principle of harmonious construction by reference to Eaton and Ferdinands v Commissioner for Public Employment [2006] HCA 5, 225 CLR 130, their Honours went on to say:
"Nonetheless, if, properly construed, it is concluded that the two statutes or provisions cannot 'stand or live together' the presumption is displaced. That 'requires the construction of, and close attention to, the particular provisions in question'. Ultimately, the question is to the operation of the statutes remains the matter to be gleaned by reference to legislative intention. That intention is to be extracted 'from all available indications'."
32 The next point in the applicant's case is the point that neither the SSA nor the IRA impliedly confers jurisdiction on the Commission to conduct a merits review. Eight reasons are advanced in support of this proposition, some of which involve repetition of points already made. I will deal with them individually.
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33 In the first reason advanced, the applicant seeks to give significance to what is said to be the jurisdictional fact in s 10(1) of the SSA that any finding of breach be made in accordance with the s 10(3) procedures, and the fact that if the Commission conducts a merits review then compliance with the s 10(3) procedures is immaterial. Counsel submits these things strongly suggest that a determination reached is final, subject to any legal error being identified.
34 Leaving aside the questions of compliance with the s 10(3) procedures being a jurisdictional fact – a matter I need not comment on – neither the fact of nor the nature of the investigative and determinative procedures established under s 10(3) can have any direct bearing on the issue in this case. Those procedures are established for the purposes of good governance of the State Service. Some cases may be simple; some may be complex. What might happen in a particular case is not relevant to the question of the significance of the procedures themselves. That Parliament has provided for a review of State Service actions, which include the imposition of sanctions following a finding of breach, speaks for itself. To say that the statutory protection afforded by ED5 "strongly suggests" that a determination is final subject to any legal error being identified, is mere hyperbole.
35 The second reason advanced relates to the nature of review of a State Service action that relates to the person's employment, other than one that is a termination of employment. The submission is that such a review is confined to a process of looking over a decision with a view to correction. That arises from an observation I made in Pervan v Frawley [2011] TASSC 27, 20 Tas R 185 at [64]. That was a case of judicial review of a decision of the then State Service Commissioner who carried out a review under s 50(1)(b) of a determination to conduct an investigation into the conduct of an employee.
36 The nature of the Commissioner's review was not an issue that was argued in that case. The parties were agreed as to what was involved in a "review" and what it meant in that case; that is, the Commissioner "looked over" the determination with a view to correction but with the Commissioner to decide whether there were reasonable grounds for the formation of the belief required to instigate the investigation. At [64] of Pervan, I made the comment that the agreed position seemed to be correct.
37 In Bullard v Tasmanian Industrial Commission [2022] TASSC 39 at [29], Blow CJ doubted the correctness of the proposition that a review under s 50(1)(b) was a limited one of looking over the process reviewing with an eye to correction if the process miscarried. His Honour noted that my comments in Pervan v Frawley were obiter, and that the nature of such a review has never been authoritatively determined by the Court.
38 Accordingly, the correctness of the foundation for this suggested reason is doubtful. More particularly, on any view of what a review under s 50(1)(b) might entail, s 50(4) makes it clear that decisions to terminate employment are to be dealt with quite separately. There is no reference in s 50 to a review in respect of a decision to terminate. Section 50(4) makes it clear that "disputes" in relation to decisions to terminate are to be dealt with by the appropriate industrial tribunal – the Commission – in accordance with the legislation under which that tribunal is established. As earlier noted, I will return to this point.
39 The third reason addresses what is said to be the "high water mark" of any implication of a merits review. This is s 30(2) of the IRA which provides that in considering an application in respect of termination of employment, the Commission must (among other things) fully take into account all of the circumstances of the case. In perhaps another exercise of putting a proposition that assumes the correctness of the ultimate point, the applicant seeks to limit the circumstances referred to in that provision to the circumstance that the Secretary has found a breach of the Code occurred. If the Commission were to conduct a merits review, it is said that it would not then be taking circumstances into account, but to determining whether or not certain circumstances ought to exist.
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40 The fourth and fifth reasons are valid but not really germane to the issue. The first is that the Commission's power to regulate its own procedure does not impliedly confer the power to conduct a merits review contrary to the statutory scheme. That much can be accepted. The Commission has power to regulate its procedure in relation to a hearing under s 29, but cannot for itself fashion the parameters of its jurisdiction. Next, the applicant refers to s 31 of the IRA, and makes the point that nothing in that provision implies a jurisdiction to conduct a merits review. I would have to agree. Section 31 deals with orders arising from hearings; that is, it deals with the consequences of a hearing under s 29.
41 The sixth reason relates to the combined operation of the two statutes, but is specifically directed to the effect on the IRA – in particular ss 30 and 31 – of the enactment of the SSA which commenced in May 2001. Those sections of the IRA as they currently read, were enacted in January 2001. The changes to ss 30 and 31 of the IRA were made, according to the Minister at the time, to provide "clear and fair criteria relating to unfair dismissal" and "to bring a level of clarity and certainty to this area so that employees and employers understand the fundamental rights, obligations and processes involved." It was said that much of what was included was "simply setting down existing practice and precedents in codify form".
42 The applicant's point is that if, contrary to the submissions previously made, those sections impliedly conferred a merits review jurisdiction, that was "overridden" by s 10(3) of the SSA. That is to say, any implication was overridden by the "express conferral of jurisdiction to authoritatively determine breaches of the Code of Conduct to the Minister or delegate."
43 The applicant further submits that such a construction is reinforced by the Industrial Relations (Commonwealth Powers) Act 2009 (Tas) by which the Fair Work Commission (FWC) was given jurisdiction over all private sector employees, to be dealt with under the Fair Work Act 2009 (Cth). From 1 January 2010 the Tasmanian Industrial Commission primarily only has jurisdiction over public sector employees or officers within the meaning of the SSA.[2]
[2] See ss 5 and 6 of the Industrial Relations (Commonwealth Powers) Act 2009.
44 Those points merely raise the combined operation of the statutes. Parliament must be taken to have been fully aware of the provisions of the IRA when it passed the 2009 enactment. In any event, it is s 10(3) of the SSA that is said to have the significance. In a sense, this takes things back to the first reason. But it does also again raise the combined operation of the two statutes, but this time in a particular respect.
45 The case of Eaton involved provisions in the Police Act 1990 (NSW) and the Industrial Relations Act 1996 (NSW). A section in the former provided that the Commissioner of Police could dismiss a probationary officer at any time and without giving reason. The Industrial Relations Act provided that a dismissed employee could apply to the Industrial Relations Commission with a claim that the dismissal was harsh, unreasonable or unjust. The majority held that a decision to dismiss a probationary officer was not subject to merits review under the relevant part of the Industrial Relations Act because the general provisions of that Act did not apply in the face of the special and in inconsistent terms of the particular provision of the Police Act.
46 The applicant in this case seeks to draw parallels. Counsel relies on observations made by Heydon J at [17] in the face of a submission that the power to review a dismissal should not be restricted by the nature of the power to dismiss. His Honour said that that was not so:
"The freedom of which an employer may dismiss can affect the capacity of an employee to challenge the dismissal if the power to dismiss is unfettered and its exercise is necessarily immune from challenge on the ground of harshness, unreasonableness or unfairness."
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47 Here of course, under the SSA the power to dismiss is not unfettered. Relevantly, that step can only be taken following a finding of a breach of the Code of Conduct under s 10. The point really comes back to the applicant's submission about the primacy and conclusivity of a determination of breach.
48 The final factor advanced to negate an implication of merits review arises from s 31(2)(a) of the IRA. That provides that a Commissioner shall not make an order under s 31 that is inconsistent with the provisions of any Act dealing with the same subject matter. The applicant contends that the exercise of any power under s 31 "which would have the effect of substituting for the Secretary's determination of breach of the Code of Conduct some different finding, would necessarily alter, impair or detract from the Secretary's power under the State Service Act, and would therefore be precluded by s 31(2)(a)."
49 All that needs to be said about this is that it seems to ignore the fact that s 50(4) of the SSA enables a person whose employment has been terminated to seek recourse from "the appropriate industrial tribunal" – presently in fact the Commission – "in accordance with the legislation which that tribunal is established". [Emphasis added]
Discussion
50 I include in this section an additional "reason" advanced by the applicant. This is not so much of a reason to construe the legislation in the way contended for, but more of an observation that the authorities that relate to the relevant operation of the FWC and its predecessors in the Federal jurisdiction do not assist, given the differences in the statutory framework.
51 Under the Fair Work Act 2009 (Cth) a person may apply for an unfair dismissal remedy and has the task of satisfying the FWC that the dismissal was harsh, unjust or unreasonable. In considering whether that is so, the FWC is to take into account (among other things) whether there was a valid reason for the dismissal related to the person's capacity or conduct. See ss 385(b), 387(a) and 394. The various iterations of the now repealed Workplace Relations Act 1996(Cth) generally operated in the same way. While it is true that this sort of structure is different from s 30 of the IRA, the notion of a "valid reason" for termination is a common central feature, as I will later discuss.
52 The applicant seeks to advance the issue about relevant authority by suggesting that the construction he contends for is "largely" consistent with the approach taken by the Full Bench of the Tasmanian Industrial Commission in Commissioner of Police v Gunston (T10313, T10316), 13 February 2003. This is something of a distraction from the essential issue at hand. I say that because the same point was put to the Commission President in the preliminary proceedings but as an alternative to the contention advanced in this Court. I do not find it particularly helpful in deciding how the issue of statutory interpretation should be resolved. Be all that as it may, I will explain the point.
53 In the Gunston case, a police officer's employment was terminated on the basis of misconduct that occurred while he was off duty. On his application for a hearing under s 29 of the IRA, the Commissioner heard evidence from a number of witnesses and decided that on the evidence before him, the termination was unfair. He said he no doubt that the Police Commissioner had an honest belief as to the facts of the alleged misconduct but that it was not based on reasonable grounds because of a mistaken view about two material facts. On an appeal to the Full Bench, it was common ground that the proper approach to the appeal was that in accordance with the well-known House v King principles.
54 At [21], the Full Bench agreed with the approach taken by the Full Commission of the South Australian Industrial Commission in Bi-Lo Pty Ltd v Hooper [1992] 53 IR 224. At page 229 of that report the Full Commission said:
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"Where the dismissal is based upon the alleged misconduct of the employee, the employer will satisfy the evidentiary onus which is cast upon it if it demonstrates that insofar as was within its power, before dismissing the employee it conducted as full and extensive investigation into all of the relevant matters surrounding the alleged misconduct as was reasonable in the circumstances; it gave the employee every reasonable opportunity and sufficient time to answer all allegations and respond thereto; and that having done those things the employer honestly and genuinely believed and had reasonable grounds for believing on the information available at that time that the employee was guilty of the misconduct alleged; and that, taking into account any mitigating circumstances either associated with some misconduct or the employee's work record, such misconduct justified dismissal. A failure to satisfactorily establish any of those matters will probably render the dismissal harsh, unjust or unreasonable."
55 The then South Australian legislation (s 31(3) of the Industrial Relations Act 1972) enabled the Industrial Commission to provide a remedy where it was "of the opinion that the dismissal was harsh, unjust or unreasonable." There was no requirement to take into account whether there was a "valid reason", and that expression did not appear elsewhere in the relevant provisions.
56 In Gunston, the Full Bench noted that the Police Commissioner had taken into account "incorrect information", that being "very relevant" to a finding that the termination was harsh, unjust or unreasonable. Of course, that phrase does not appear in the IRA. As pointed out by the President in his ruling in the present case, in addition to saying that the Bi-Lo test had not been met, the Full Bench went on to refer to the case of Selvachandran v Peteron Plastics (1995) 62 IR 371 where Northrop J said the adjective "valid" in the phrase a "valid reason" should be given the meaning of "sound, defensible and well-founded." The Full Bench said it was satisfied there was no valid reason for the dismissal "and that the Police Commissioner had not demonstrated his decision was sound, defensible or well-founded.
57 In dealing with the Gunston/Bi-Lo "argument" in his ruling, the President pointed out that in both cases evidence had been lead in the first instance hearings. (I note that in neither appeal was there any statement of disapproval of that having occurred.) The President went on to say that direct evidence is irrelevant to the objective part of the Bi-Lo test and continued:
"So where the employer has made an error in its findings of fact regarding the alleged conduct, it will not have reasonable grounds for believing, on the information available to it, that the employee was guilty of the misconduct alleged. The relevance of direct evidence….is that at least engages the objective component of the test. If the conduct did not occur then objectively there would be no reasonable grounds for the employer to believe that misconduct had occurred".
58 The President went to say that he did think it was inappropriate to hear direct evidence where the Bi-Lo test might apply.
59 I would simply add the observation that a failure to satisfactorily establish any of the matters set out in the quoted passage from Bi-Lo – full and extensive investigations, procedural fairness and genuine belief on reasonable grounds of guilt and misconduct – was said to "probably" render the dismissal harsh, unjust or unreasonable, not that it inevitably or conclusively did so.[3]
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[3] The Bi-Lo approach has been expressly disapproved of in New South Wales where the legislation enables the Tribunal to take into account a number of things including whether a reason for the dismissal was given to the applicant and if so, its nature, and whether it had a basis in fact – s 88(a) and (b) of the Industrial Relations Act 1996 (NSW). See for instance Pastrycooks Employees, Biscuit Makers Employees & Flour and Sugar Goods Workers Union (NSW) v Gartrell White (No 3) [1990] 35 IR 70; New South Wales Nurses Association obo Rudder v Booroongen Djugun Aboriginal Corporation [2007] NSW IR Com 89; Basan v Commissioner of Police (No 3) [2023] NSW IRComm 1028.
60 In any event, the Bi-Lo test received the endorsement of von Doussa J in Sangwin v Imogen, unreported, Industrial Relations Court of Australia, 8 March 1996. After referring to Bi-Lo, his Honour expressed the opinion that if an employer honestly believed on reasonable grounds after sufficient enquiry that the employee had been guilty of serious misconduct, a valid ground within the meaning of s 170DE(1) of the Industrial Relations Act 1988 existed for the termination.[4]
[4] Section 170DE(1) prohibited an employer from terminating an employee's employment unless there was a valid reason connected with the employers capacity or conduct, or based on operational requirements61 I do not agree that authorities from Federal jurisdictions are of no assistance. As is accepted by the applicant, the wording of s 30(3) of the IRA is based on Article 4 of the International Termination of Employment Convention 1982[5] (the Convention). The phrase "who has a reasonable expectation of continuing employment" does not appear in Article 4 but apart from that and some minor language differences, the subsection is, in effect, the same. Embodiments of Article 4 found their way into various pieces of industrial and workplace relations legislation including the now repealed Industrial Relations Act 1988 (Cth) and Workplace Relations Act 1996 (Cth), and into the Fair Work Act 2009 (Cth).
[5] Article 4: "The employment of a worker shall not be terminated unless there is a valid reason for such termination connected with the capacity or conduct of the worker or based on the operational requirements of the undertaking, establishment or service."
62 Section 170DE(1) of the Industrial Relations Act 1988 (Cth) prohibited termination unless there was a valid reason, or valid reasons, connected with the employee's capacity or conduct or based on operational requirements. The wording is close to that of Article 4 of the Convention. That section was considered in Cosco Holdings Pty Ltd v Thu (1997) 79 FCR 566. At 571, Northrop ACJ referred to his own decision in Selvachandran v Peteron Plastics (above) in which he said the adjective 'valid' should be given the meaning of "sound, defensible or well founded", and at 576 went on to say that to be a valid reason, the reason must be lawful in the sense of not being prohibited and generally being based on, in that case, operational requirements.
63 His Honour said, "The word 'valid' is used as an adjective qualifying the word 'reason' and is used in the sense of sound, defensible or well-founded with the respect of the foundation, namely, [in that case] the operational requirements of employer". See also Lindgren and Lehane JJ at 590.
64 Cosco Holdings Pty Ltd was considered by the Full Court of the Federal Court in Qantas Airways Ltd v Cornwall (1998) 84 FCR 483. The primary point was whether the test of a "valid reason" in s 170DE(1) excluded consideration of whether the overall effect of the termination was harsh, unjust or unreasonable. The Court endorsed the notion that a reason founded on a connection with an employee's capacity or conduct, or based on operational requirements (etc), and which was sound, defensible and well-founded was a "valid reason".
65 Of particular interest is that (at 488) the Court made it clear that in cases in which an employee's conduct is relied on to found a reason for termination, it was necessary to examine the relevant factual matrix to determine whether the termination was for a valid reason; the nature of the conduct in the full context in which it actually occurred needed to be considered. At 492, the Court said that conduct is not committed in a vacuum but in the course of interaction of persons and circumstances, and the events which lead up to an action and those which accompany it may qualify and characterise the nature of the conduct involved. Such consideration might reveal the absence of a valid reason.[6]
[6] See also Allied Express Transport Pty Ltd v Anderson (1998) 81 IR 410.
66 Of further significance is that (at 488-489) the Court discussed Cosco Holdings and a divergent decision of the Full Court of the Industrial Relations Court of Australia, Murdoch University v Mainsbridge [1998] 84 IR 111. In that discussion, the Court noted that in applying what was said in
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Cosco Holdings to the facts of Murdoch University, the reason for dismissal could not have been valid in the sense of being sound, defensible or well-founded with respect to the employee's conduct "if the conduct had not occurred." [My emphasis].
67 In Patty v Commonwealth Bank of Australia [1999] 179 ALR 57 Ryan J considered both Cosco Holdings and Qantas v Cornwall as well as Sangwin v Imogen (above). His Honour heard evidence relating to the conduct of the employee and said that he was unable to find that the applicant was implicated in the alleged conduct. His Honour continued on to say that this raised "the subsidiary inquiry indicated by von Doussa J in Sangwin v Imogen" into whether the employer's belief that the applicant had been implicated was based on reasonable grounds and was formed after sufficient inquiry. At [78], his Honour concluded that the employer had not conducted a sufficient inquiry and went on to hold that mere suspicion or possibility of guilt does not constitute a valid reason for termination. This seems to be persuasive authority for the proposition that, at least in that statutory context, the process is first one of fact finding, followed by the Sangwin "subsidiary inquiry".
68 Section 170CG(3)(a) of the later Workplace Relations Act provided that in determining, for the purposes of the arbitration, whether a termination was harsh, unjust or unreasonable, the Commissioner must have regard to whether there was a valid reason for the termination related to the capacity or conduct of the employee or to the operational requirements of the employers undertaking, established or service. This provision was considered in Edwards v Giudice [1999] FCA 1831, 94 FCR 561. The issue was whether the Commissioner at "first instance" had made sufficient findings of fact when the employer's allegations about the employee's conduct were in issue.
69 Moore J held that when the reason for a termination is based on misconduct the Commission must, if it is an issue, determine whether the conduct occurred; the obligation flowed from the provision. His Honour reiterated that the process contemplated by the provision requires an investigation as to whether the conduct relied occurred "as a necessary step in the process of determining whether a valid reason existed": [4]-[6]. Marshall J implicitly agreed with the need to find facts but focused more on the absence of reasons in the case at hand, his Honour noting the absence of findings that precisely defined the misconduct or its gravity; [40], [46]-[48].[7]
[7] This approach is apparently well established: see for instance Rail Corporation New South Wales v Vrettos (2008) 176 IR 129; King v Freshmore (Vic) Pty Ltd [2000] AIRC 1019; Williams v Viridian Glass Ltd [2020] FWC 250; Shah v Catholic Education Office Parramatta Diocese [2022] FWC 443.
70 At [7] Moore J noted that a reason would be valid because the conduct occurred and justified termination, or it might not be valid because the conduct did not occur, or did occur but did not justify termination. His Honour also noted that an employee may concede in an arbitration that the conduct took place and it was then really only a question of the appropriateness or otherwise of the sanction: see also Finkelstein J (in dissent) at [70], [72], where his Honour noted that often facts can be assumed because they are not in issue, or that the assumption would cause no injustice.
71 Of course, under the IRA it is not the case that the termination must be shown to be harsh, unjust or unreasonable "taking into account" whether there was a valid reason. The ultimate question is whether the termination was unfair. But because the genesis of s 30(4) is Article 4 of the Convention, and hence common to the legislation considered in those cases, they are influential in deciding whether the provisions of the SSA modify the IRA to the extent the applicant contends.
Resolution
72 As a preliminary observation I note that the resolution of the show cause order requires a decision as to what the Commission is not permitted to do. It does not require me to define with any degree of precision the outer boundaries of what it may properly do within its jurisdiction. In that
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respect, it is critical to bear in mind that the Commission is conducting a hearing in respect of an
industrial dispute relating to the termination of employment.73 Discussion of the Convention and what is to be gained from the cases discussed raises an important point. It relates to the applicant's concession that when it comes to s 30(3) and (4) and the establishment of a "valid reason", there is "no difficulty with the Commission exercising a de novo hearing (sic) to receive evidence in relation to the matters relating to s 30 criteria." That is, the issue of whether or not in truth, the termination was for a proscribed reason. This, the applicant says, does not extend to the anterior question of the finding of a breach. It does however, allow for evidence about the genuineness or otherwise of the apparent reason, being the finding of breach.
74 Article 5 of the Convention sets out five matters which "inter alia shall not constitute valid reasons for termination".[Emphasis added] Section 170DF(1) of the Industrial Relations Act and s 170CK(2) of the later Workplace Relations Act were slightly enlarged embodiments of Article 5. However in both cases what was prohibited was termination for one or more of the reasons, or for reasons including any one of more of the stated reasons. Neither section, in specific terms at least, allowed for any latitude in what might be a proscribed or invalid reason.
75 Section 30(4) of the IRA draws more directly from Article 4 and sets out a non-exhaustive of reasons which are not valid reasons for termination. The matters listed in ss (4)(a) to (g) again form a slightly expanded list from that contained in Article 5. But the important point is that the chapeau to s 30(4) is in the following terms: "Without limitation, the following are not valid reasons for termination or employment…." This of itself creates the room for an allegation of invalidity based on the alleged conduct not having occurred.
76 The applicant's contention proceeds on the assumption that all that is required of the employer is proof the termination was not based on any of the listed proscribed matters. In fact, the provision allows for any matter to be raised that would go to the issue of a valid reason. The Commission would be obliged to deal with any invalidity issue reasonably raised.
77 Under s 30, the issue of validity is a separate one from that of the unfairness of the termination itself. The change in where the onus falls from one to the other is a significant indication. Respectfully borrowing from what was said by the plurality in Victoria v The Commonwealth [1996] 187 CLR 416 at 517-518 – speaking in a slightly different context[8] – if "validity" and "unfairness" were synonyms, or unfairness treated as a subset of grounds that were not valid, there would be no need for this change.
[8] The issue was the Constitutional validity of s 170DE(2) of the Industrial Relations Act 1998 (Cth) which provided that a reason for termination is not valid if it was harsh unjust or unreasonable. Their Honours were speaking of s 170EDA(1). That provided that where there was an allegation of a termination of employment for no valid reason, the termination was taken to be in breach of the obligation not to terminate without a valid reason unless the employer proved otherwise; if the employer so proved, the employee could prove the reason or reasons proved by the employer were not valid.
78 Further, it should also be noted that when considering the 'text, context and purpose' regime of statutory construction, the context provided to the IRA by the Convention include Articles 8 and 9. The former states that a worker who considers that his employment was unjustifiably terminated shall be entitled to appeal against that termination to an impartial body, "such as a court, a labour tribunal, arbitration committee or arbitrator." Article 9 provides that the bodies referred to in Article 8 "shall be empowered to examine the reasons given for determination and the other circumstances relating to the case and to render a decision on whether the termination was justified".
79 Be that as it may, the question primarily comes back to the scheme created by the combined operation of the two Acts. Section 10 of the SSA deals generally with alleged breaches of the Code of
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Conduct. The power to actually make a determination of a finding of breach is implied by the application of the principles of statutory interpretation. The power to impose a sanction pre-supposes a finding of a breach. It is correct that the process of a finding of a breach is statutorily based in that sense, but of itself that takes the matter nowhere. A finding of a breach is not given any presumptive status. A finding of a breach is expressly made amenable to review if it does not result in termination, and expressly made the province of the Commission if it does.
80 Section 50(4) of the SSA appears in a section within a Division headed "Review of Actions". That heading forms part of the Act: Acts Interpretation Act 1931, s 6(2). But s 50(4) does not contain the word "review". That word may have different meanings in different statutory contexts but it is not used in the SSA in relation to the resolution of disputes about termination. It is used in s 19A of the IRA, but that specifically relates to reviews under s 50(1) of the SSA, which is not what is presently before the Commission.
81 I repeat; the Commission is to conduct a hearing in respect of an industrial dispute that relates to termination. As a hearing in respect of an industrial dispute relating to termination, it is solely governed by the IRA, as indeed is provided for in general terms by s 50(4) of the SSA. In essence, this was the thrust of the respondent's submissions; That is, the breadth of terms of the provisions of the IRA simply do not allow for any modification or restriction in operation as suggested.
82 There are features of the IRA that do not sit happily with the applicant's contention. The references in s 29 of the IRA to a "hearing in respect of an industrial dispute relating to termination of employment" would, in essence, have to be read down as meaning a "jurisdictional review of a termination of employment." As conceded by counsel, s 29(1D)(e) and (f) would, instead of requiring full particulars of the circumstances giving rise to the dispute and the nature of the claim, have to be read as requiring particulars of the alleged jurisdictional error. Similarly, s 30(2) which requires the Commission to take into account all of the circumstances of the case, would have to be read down to refer only to the aspects that vitiate the determination.
83 An additional problem may also arise in relation to the principal remedy of reinstatement provided for in s 30(9). If jurisdictional error invalidates the reason for termination then, irrespective of the merits, reinstatement or re-employment, or compensation if those things are impracticable, would seem to follow.
84 The particular provisions of each statute do not share a field of operation. One deals with a finding of a breach of the Code of Conduct that may lead to termination, while the other deals with the consequential situation in which the dismissed employee is aggrieved and wishes to pursue a remedy. There is a strong presumption that the legislature does not intend to contradict itself but in fact intends both Acts to operate within their given sphere: Butler v Attorney-General (Vic) (1961) 106 CLR 268 per Fullagar J at 276.
85 I do not see anything at all that suggests, even arguably, that the two statutes do not, and cannot, operate harmoniously in relevant respects. Application of the principle discussed in Eaton and Cottle (above) does not result in the IRA operating as the applicant suggests. Further, and of more particular relevance, is the principle that a later Act is not to be interpreted as impliedly withdrawing or limiting a conferral of jurisdiction unless the implication appears clearly and unmistakably: Shergold v Tanner [2002] HCA 19, 209 CLR 126 at [34]. In this case, it does not.
Outcome
86 I am not persuaded that the Commission is about to embark on an exercise beyond its jurisdictional limits or outside the scope of its powers. What evidence is to be received at the hearing and in what form will be subject to the way in which the parties frame the issues, and to the directions of the Commission bearing in mind the wide procedural powers it possesses.
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87 The general order to show cause is discharged.
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