Mr Paul Cronin v Choice Homes (Qld) Pty Ltd

[2013] FWC 10240

[2013] FWC 10240

FAIR WORK COMMISSION

DECISION

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

Mr Paul Cronin
v
Choice Homes (Qld) Pty Ltd
(U2013/1615)

DEPUTY PRESIDENT ASBURY BRISBANE, 30 DECEMBER 2013

Application for relief from unfair dismissal - Arbitration.

[1] Paul Cronin was the Financial Controller of Choice Homes (Qld) Pty Ltd (Choice Homes) from 19 March 2007 until 2 May 2013, when he was summarily dismissed by the Chief Executive Officer and sole Director of Choice Homes, Mr Troy Knight. Choice Homes is a family owned business founded by Mr Knight’s parents. Mr Knight became sole Director and Chief Executive Officer ten years ago at which time his parents retired from the business. Mr Knight’s parents were killed in a plane crash in 2012. Choice Homes is a building company and has other associated entities that are involved in real estate and land development. A number of family members of Mr Knight and his late parents are employed by Choice Homes.

[2] The events leading to Mr Cronin’s dismissal can be briefly stated. In April 2013, Mr Knight purchased a Lamborghini motor vehicle. Mr Knight said that he had worked towards this for a very long time. Thursday 2 May 2013 was the 20th anniversary of Mr Knight’s involvement with Choice Homes. At 9.40 am on that morning, Mr Knight received an email from Mr Steve Bignill, the Construction Manager of Choice Homes, and a cousin of Mr Knight’s wife. The email included images of a 20 year service award medallion and a Lamborghini motor vehicle and stated in the subject line:

“Congratulations you have reached 20 years service on the books .... and your reward is a Lamborghini.”

[3] The email was also addressed to a group termed “AllStaff” comprising all of the staff of Choice Homes. At 9.43 am Mr Cronin responded to that email and directed an email to Mr Bignill, Mr Cronin and the “AllStaff” group. The subject line of Mr Cronin’s email stated:

“RE: Congratulations - I actually found his original resume too !!”

[4] Attached was a document in the following terms:

“Hobbies & Interests

● Gym and fitness
● Tennis
● Computers
● Excessive Masturbation
● Football
● Socialising
● Bungee jumping and skydiving”

[5] It is not in dispute that the attached document is a “mock” resume taken from a website called “Lamebook”, containing documents said to be humorous.

[6] Upon receiving this email, Mr Knight’s reaction was to contact his solicitors who attended at the premises of Choice Homes and summarily dismissed Mr Cronin, by handing him a letter on Choice Homes letterhead, under the signature of Mr Knight, in the following terms:

“Dear Paul

TERMINATION OF EMPLOYMENT

We refer to the email you despatched to all staff members of Choice Homes (Qld) Pty Ltd this morning containing content of an explicit sexual nature. The email was both offensive and inappropriate and constitutes serious misconduct on your part.

Accordingly, we would advise you that your employment as Financial Controller with Choice Homes (Qld) Pty Ltd is terminated effective immediately.

Your employee entitlements will be calculated and paid in the normal manner.

We would take this opportunity to remind you of the obligations incumbent upon you pursuant to the terms of your employment.”

[7] Mr Cronin applies for an unfair dismissal remedy under s.394 of the Fair Work Act 2009 (the Act), and contends that his dismissal is unfair on grounds including that the email was a joke and intended as such, and the workplace culture at Choice Homes was one where the distribution of emails containing subject matter that is sexually explicit, sexist and racist was accepted and endorsed. Mr Cronin also contends that other employees who engaged in serious misconduct were not dismissed and that his dismissal is disproportionate to the severity of the conduct in which he engaged.

[8] Choice Homes contends that Mr Cronin engaged in serious misconduct. In the Form F2 Employer response to application for unfair dismissal remedy, it is asserted that Mr Knight was deeply offended and mortified by an email being distributed to all staff, containing a suggestion that in Mr Cronin’s view, Mr Knight is a “wanker”. It is also asserted that Mr Cronin’s conduct is inappropriate for a senior manager and sends a message that senior management of the company are not united. Mr Knight said in his evidence that he felt sexually harassed by the email and was concerned that it was offensive, particularly to female staff.

[9] Choice Homes disputes the assertion made by Mr Cronin that it has or encourages a workplace culture where such emails are distributed. Further, Choice Homes maintains that Mr Cronin was responsible for human resource management issues including ensuring that the Company’s email systems were not used to disseminate inappropriate material.

[10] The issues in dispute in this case are whether Mr Cronin’s conduct in sending the offending email was serious misconduct justifying summary dismissal, and whether the dismissal was unfair on the grounds that it was harsh, unjust or unreasonable.

LEGISLATION AND CASE LAW

[11] In deciding whether a dismissal is harsh, unjust or unreasonable, the Commission must take into account procedural and substantive matters set out in s.387 of the Act as follows:

(a) Whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees) and;
(b) Whether the person was notified of that reason; and
(c) Whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and
(d) Any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to the dismissal; and
(e) If the dismissal related to unsatisfactory performance – whether the person had been warned about that unsatisfactory performance before the dismissal; and
(f) The degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(g) The degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(h) Any other matters the Commission considers relevant.

[12] The Commission is obliged to make a finding about whether or not there was a valid reason for dismissal. 1 A valid reason for dismissal is “sound, defensible or well founded” and not “capricious, fanciful, spiteful or prejudiced.”2 The reason for dismissal must also be defensible or justifiable on an objective analysis of the relevant facts3, and the validity is judged by reference to the Tribunal’s assessment of the factual circumstances as to what the employee is capable of doing or has done.4

[13] In matters involving misconduct, the Commission must look at the conduct of the dismissed person and determine on the balance of probabilities what the conduct was and whether it took place. 5 The test is whether the conduct took place, not whether the employer believed on reasonable grounds, after sufficient enquiry, that the conduct took place.6 In determining whether a dismissal is unfair:

“It is not the [Commission’s] function to stand in the shoes of the employer and determine whether or not the decision made by the employer was a decision that would be made by the court but rather it is for the court to assess whether the employer had a valid reason connected with the employee’s capacity or conduct...” 7

[14] The matters in s.387 go to both substantive and procedural and substantive fairness and it is necessary to weigh each of those matters in any given case, and decide whether on balance, a dismissal is harsh, unjust or unreasonable. A dismissal may be:

Harsh - because of its consequences for the personal and economic situation of the employee, or because it is disproportionate to the gravity of the misconduct;

Unjust - because the employee was not guilty of the misconduct on which the employer acted; and/or

Unreasonable - because it was decided on inferences that could not reasonably have been drawn from the material before the employer. 8

[15] There is a distinction in the provisions of the Act between “serious misconduct” and “misconduct”. The former term is defined and the latter is not. The term “serious misconduct” is defined in s.12 of the Act and Regulation 1.07 as follows:

“1.07 Meaning of serious misconduct

(1) For the definition of serious misconduct in section 12 of the Act, serious misconduct has its ordinary meaning.

(2) For subregulation (1), conduct that is serious misconduct includes both of the following:

(a) wilful or deliberate behaviour by an employee that is inconsistent with the continuation of the contract of employment;

(b) conduct that causes serious and imminent risk to:

(i) the health or safety of a person; or

(ii) the reputation, viability or profitability of the employer’s business.

(3) For subregulation (1), conduct that is serious misconduct includes each of the following:

(a) the employee, in the course of the employee’s employment, engaging in:

(i) theft; or

(ii) fraud; or

(iii) assault;

(b) the employee being intoxicated at work;

(c) the employee refusing to carry out a lawful and reasonable instruction that is consistent with the employee’s contract of employment.

(4) Subregulation (3) does not apply if the employee is able to show that, in the circumstances, the conduct engaged in by the employee was not conduct that made employment in the period of notice unreasonable.

(5) For paragraph (3) (b), an employee is taken to be intoxicated if the employee’s faculties are, by reason of the employee being under the influence of intoxicating liquor or a drug (except a drug administered by, or taken in accordance with the directions of, a person lawfully authorised to administer the drug), so impaired that the employee is unfit to be entrusted with the employee’s duties or with any duty that the employee may be called upon to perform.”

[16] Regard may be had to this definition to decide whether there is a valid reason for the dismissal of an employee who is alleged to have engaged in serious misconduct. In general terms, misconduct is wrongful conduct. To be properly described as “serious”, misconduct must be: “significantly worse than negligence and serious in its culpable quality as misconduct, as distinct from the results”. 9

[17] Serious misconduct is judged on an objective basis, and it is therefore not necessary that the employee should intend to do wrong. Wilful misconduct carries the additional connotation of intention, or a deliberately reckless course of misconduct, with knowledge that it is wrong. 10 Regulation 1.07 does not require that misconduct be wilful before it is serious misconduct, but provides that serious misconduct includes wilful or deliberate behaviour.

[18] When the matters in s.387 are weighed for the purposes of considering whether a particular dismissal was harsh, unjust or unreasonable, it may be that where the employer demonstrates that the employee engaged in serious misconduct, procedural deficiencies will be outweighed so that on balance, the dismissal is not unfair. An employee who engages in an act of misconduct may also be found to have been unfairly dismissed because the misconduct was not serious, such that it outweighed deficiencies in procedural fairness or because of other extenuating circumstances particular to the dismissed employee. Alternatively an act of misconduct which, considered in isolation, would not be a valid reason for dismissal, may become so, when considered in the context of previous acts of misconduct about which the employee had been warned.

[19] The approach of the Commission in cases involving use of an employer’s electronic communication system to store and transmit inappropriate images was set out by a Full Bench of the Commission in Wake v Queensland Rail. 11 In that case, the Full Bench stated that:

“The employer’s right to exercise control over its own information technology systems is undoubted. If that right is exercised unfairly or unlawfully, however, the employee concerned may have a remedy under the Act.”

[20] The Full Bench in that case also went on to reject the proposition that a long term employee with an otherwise unblemished service record is immune from termination for breaching an employer’s policies with respect to use of the employer’s information technology unless guilty of breaches involving large amounts of hard core pornography, holding that an employer is entitled to take a harder line than that. In Wake the Full Bench noted that the employer had a firm and well-publicised policy prohibiting the use of its electronic communication system to store or transmit sexually-related, pornographic or violent material, and had gone to great lengths to alert employees to the policy and to warn them that breaches would result in dismissal.

[21] The Full Bench concluded that it is in the public interest, subject to considerations of fairness, that the Commission’s decisions should support employers who are striving to stop inappropriate email traffic, holding that:

“...The use of company electronic communications systems for storage and transmission of images containing sexually-related, pornographic and violent material is a serious and socially important issue. The appellant, rightly in our view, made sustained efforts over a number of years to make employees aware of its policy and the consequences of breaching the policy. Despite those efforts and repeated warnings the employee breached the policy in a substantial way and on a number of occasions. While appreciating that loss of employment is a bitter blow, we see no proper basis on which the Commission might properly intervene to reverse the employer’s decision in this case.”

PROCEDURAL MATTERS

[22] The application was made on 16 May 2013, within the time required in s.394(2) of the Act. The parties agree that, for the purposes of these proceedings, Mr Cronin’s annual earnings are $205,000.00 per annum, but it is not in dispute that he is a person protected from unfair dismissal as defined in s.382 of the Act, on the basis that he is covered by the Choice Homes (Qld) Pty Ltd Workplace Agreement 2007. Choice Homes is not a small business and the dismissal was not a redundancy.

[23] The matter was dealt with by way of a hearing as it was considered that this was the appropriate course. Permission was granted for both parties to be legally represented, on the basis that it would enable the matter to be dealt with more efficiently, taking into account its complexity. Mr Cronin was represented by Ms Milner of Milner Lawyers and Choice Homes by Mr Yeatman of Counsel instructed by Ms Bostock of Bostock and Frazer Lawyers.

[24] Evidence in support of the application was given by Mr Cronin on his own behalf. 12 Evidence for Choice Homes was given by:

● Troy Jason Knight, sole Director; 13
● Glynn Catherall, Investment Sales Manager; 14
● Steve Bignill, Construction Manager (the cousin of Mr Knight’s wife); 15
● Jonathan Stern, IT Manager;  16
● Barbara Colman, former Book Keeper; 17
● Philip Anthony Saunders, former Operations Manager (Mr Knight’s Uncle); 18 and
● Kelly Mae Higgins - General Manager Metropolitan Property Management. 19

EVIDENCE

The reason for the dismissal

[25] The reason given by Choice Homes for Mr Cronin’s dismissal was articulated in a number of ways. The dismissal letter states that the email he sent to all staff at around 9.43 am on 2 May 2013, contained content of an explicit sexual nature. In his evidence to the Commission, Mr Knight said that when he saw the email his instant reaction was disgust and mortification, and he believed that Mr Cronin was calling him a “wanker” in an email to all staff. Mr Knight said he felt humiliated and was particularly concerned that female staff would be offended.

[26] Mr Knight said he did not believe that the email was a joke. Mr Knight also said that the email content was directed at him, and he believed it was sexually explicit and constituted sexual harassment.

[27] Under cross-examination Mr Knight said that he did not investigate whether female staff were upset or concerned about Mr Cronin’s email before dismissing Mr Cronin and also did not investigate the email accounts of other employees at that time. In relation to the email, Mr Knight agreed that the picture in Mr Bignill’s email was of his new Lamborghini. Mr Knight also agreed that staff knew that Choice Homes had been his parents’ business and that he had probably not been required to submit a resume to obtain his position with the company.

[28] In response to a question about why he had not given Mr Cronin a chance to apologise for sending the email, Mr Knight said that he still had to walk around in front of the staff with Mr Cronin calling him something. Mr Knight agreed with the proposition that if he had undertaken an investigation after the email of 2 May 2013, he would have realised that Mr Cronin was in the habit of sending emails that were intended to be humorous and might also have discovered the culture in the workplace of employees sending all sorts of offensive material around the business. Mr Knight said that he did not undertake such an investigation because Mr Cronin was responsible for filtering emails.

[29] A number of witnesses for Choice Homes gave evidence about their views of the email and its offensiveness. Mr Stern said that he was sitting with Mr Knight when he received the email. Mr Stern had previously seen the image on the “Lamebook” website, but maintained that it was not a joke when directed at Mr Knight. Mr Stern also said that he thought the email from Mr Cronin was offensive and cheeky and that Mr Cronin was pushing the boundaries by sending it to all staff of Choice Homes.

[30] Under cross-examination Mr Stern agreed that he knew the attachment to Mr Cronin’s email was probably from the “Lamebook” site and told Mr Knight that this was the case and that he was sure that Mr Cronin meant it as a joke. Mr Stern said that he told Mr Knight this straight away, and also stated that maybe Mr Cronin’s email was not intended to be that strong.

[31] Mr Bignill said that he sent an email to Mr Knight on 2 May 2013 because he believed that Mr Knight should be congratulated on achieving 20 years with Choice Homes. Mr Bignill viewed Mr Cronin’s email as being in bad taste and inappropriate, and said that it should not have been sent. Mr Bignill also said that Mr Cronin made a habit of responding to emails with out of the ordinary comments about everyone and everything, but this time he had gone too far. Mr Bignill did not find Mr Cronin’s email funny, and believed that he should not have sent it to all staff.

[32] Mr Catherall said that his reaction on receiving Mr Cronin’s email was: “WOW, Paul Cronin just called the boss a wanker”. Mr Catherall also said that he thought the email was demeaning, disrespectful and undermined Mr Knight, and that Mr Cronin deserved to lose his job. Ms Colman said that her reaction to the email was to ask why Mr Cronin would have sent it. Ms Colman also said that it was inappropriate and a total insult to the boss, as well as showing no respect to work colleagues. In Ms Colman’s view the email was appalling. Further, Ms Colman said that as an executive in the Company Mr Cronin should have been showing support for Mr Knight, particularly because of what had happened to his parents.

[33] Mr Cronin said that his email, of 2 May 2013, was intended as a good natured joke between friends who were also work colleagues and was sent in the context of a humorous email exchange. Mr Cronin also said that he did not expect anyone to be offended by the email and it was clearly a social media posting of a snapshot of a resume. It would have been clear to all staff at Choice Homes that Mr Knight would never have had to submit a resume to his family Company. Further, Mr Cronin said that if he had known Mr Knight was offended he would have offered an apology and would have had no difficulty apologising to all staff.

The alleged workplace culture of inappropriate use of email

[34] Mr Stern tendered emails identified in a search he conducted of Mr Cronin’s email account. That search is said to establish that Mr Cronin had forwarded emails that contained sexually explicit material, material containing sexual innuendo or racist jokes, to internal staff members and external email addresses. Mr Stern also tendered copies of pornographic videos said to have been emailed from Mr Cronin’s account.

[35] Mr Cronin countered this evidence by tendering a significant number of emails sent to him by various colleagues during his employment at Choice Homes and said that it was accepted practice for employees of Choice Homes to send each other emails containing explicit sexual content, sexual innuendo, and jokes and stories with racist, sexist or anti-religious themes.

[36] The images and language of the emails are extremely offensive. It is apparent that the female staff members at Choice Homes were active participants in dissemination of this material. The emails comprise sexually explicit images and words, which can accurately be described as “hard core pornography”. There are also sexist emails which are derogatory to women and to groups such as homosexuals and transgender. Some of the emails are racist and denigrate persons of particular ethnic or religious backgrounds, including persons of Aboriginal descent and those who follow the Islamic faith. There are emails denigrating asylum seekers and persons with particular physical characteristics such as being overweight. There are sexually explicit images involving older persons and some images of children containing sexual innuendo.

[37] Some emails were directed to “All Staff” and others to particular employees. The evidence also established that there was an email group made up of employees of Choice Homes designated “the Porn Stars”. Mr Stern said the Porn Stars group was in existence when he started employment with Choice Homes. The identity of members was kept secret but persons who wanted to join would advise Mr Stern or someone in the IT department, and their email accounts would be added to the Porn Stars group.

[38] In relation to the “Porn Stars” group, Mr Cronin said he was not a member but it was in existence when he started work at Choice Homes and he concluded that it was accepted practice and affirmed by the Company. On receiving emails from members of that group, Mr Cronin said that he may have replied on a number of occasions or otherwise deleted the material. Mr Cronin later said that he may have forwarded some of the material to his home email address or to his wife or a friend. Further, Mr Cronin agreed with the proposition that if there was a culture at Choice Homes which suggested that such emails were acceptable, he was part of that culture. Mr Cronin also said that he did not perceive that he had a responsibility to do anything about the culture.

[39] Mr Stern was a member of the Porn Stars group but left the group “some time ago” and removed it from the server “some time in the last three years”. Mr Stern could not identify the members of the group as it had been deleted. Mr Stern also said that “to the best of his knowledge” Mr Knight had never been a member of the “Allstaff” group, and that he did not think that if an old email to “Allstaff” was opened, it would show the group as it was at that time. Mr Stern did not check whether this was the case before printing the emails and attaching them to his statement. Further, Mr Stern said that he had been asked by Mr Knight to check Mr Cronin’s email account but had not checked the account of any other staff member.

[40] Under cross-examination, Mr Stern agreed that the majority of emails appended to his statement, and said to be evidence of inappropriate use of email by Mr Cronin, were emails sent by other staff members that Mr Cronin had simply forwarded to his wife, a friend and to his home email address. Mr Stern also agreed that he and Mr Bignill had been the originators of a number of the emails in question and had sent them to all staff. Further, Mr Stern agreed that he had sent emails to all staff containing sexist, racist and generally offensive content. One of the emails shown to Mr Stern in cross-examination was sent by Mr Stern to Mr Cronin on 7 June 2013, after Mr Cronin was dismissed. Mr Stern also said that there had been no technical upgrades to the firewalls in the Choice Homes computer system since May 2013.

[41] Mr Bignill said that he was a member of the Porn Stars group but removed himself in 2008 or 2009. Mr Bignill also acknowledged that he used to send joke emails but did not believe that there is any accepted practice in the office, where staff send emails to other staff containing sexually explicit content, sexual innuendo or racist and sexist jokes and stories.

[42] According to Mr Bignill there may have been some male staff members in the company who sent emails with sexually explicit content, but this had not occurred for a very long time - by Mr Bignill’s estimate since 2007. Mr Bignill also recalled a meeting being held by Mr Saunders during which staff were told not to send emails containing sexually explicit material. This meeting was held because of a complaint made by a female staff member who was offended by an email she had received.

[43] Under cross-examination Mr Bignill agreed that he sent a number of emails including:

● two emails depicting a person with breasts and a penis; 20
● an older woman with exposed tattooed breasts and pierced genitalia entitled “Grandma got a tattoo”; 21
● a series of images of naked and semi-naked women entitled “Playboy and how the times change”; 22

[44] In relation to one of the emails depicting a person with breasts and a penis, Mr Bignill said it was intended to be a joke because he was going on his first trip to Thailand. Mr Bignill was also shown a number of other emails he sent to all staff and to Mr Cronin which, notwithstanding Mr Bignill’s views, are highly offensive on the basis that they are racist, sexist or sexually explicit. Mr Bignill said he had never been warned or disciplined about sending inappropriate emails, but had attended a meeting where Mr Saunders spoke about not circulating offensive emails. In response to the proposition that when he made his statement in these proceedings that Mr Bignill knew that such emails were routinely circulated to all staff of Choice Homes, Mr Bignill said that his statement related to the email from Mr Cronin to all staff, sent on 2 May 2013 and not to other emails in evidence in this matter. Mr Bignill also said that in recent times Mr Knight has addressed a majority of staff about not sending offensive emails and that the situation had: “basically... gone back to what we were told by Phil Saunders.”

[45] Mr Catherall said that he was not aware of any culture within Choice Homes where staff send emails containing material with explicit sexual conduct or sexual innuendo and jokes or stories with racist, sexist or anti-religious themes and did not believe that such a culture existed. Mr Catherall was shown a number of emails to the “Allstaff” group appended to Mr Cronin’s witness statement, and said that one image - a depiction of a potato shaped like a penis said to be a “dicktater” - was “a bit crude” and that he did not find the others offensive. Ms Colman said that she was aware of emails sent by staff to each other that were not work related, but thought that these were a waste of time.

[46] Mr Saunders said that during his time at Choice Homes there was an incident in 2006 or 2007 where it became apparent that there were some staff members distributing emails that contained offensive material of a sexual or racist nature. A complaint was made by a female staff member who had been offended after receiving an inappropriate email. Mr Saunders resolved the issue by meeting with the staff member and the complainant and calling a staff meeting at which all staff were informed that this behaviour would not be tolerated and that they were no longer permitted to use the internet for personal use. Mr Saunders had no knowledge of the group called the “Porn Stars”.

[47] Mr Knight said that he had no idea and was not aware that staff regularly sent emails with explicit sexual content or sexual innuendo, or jokes and stories with racist, sexist or anti-religious themes. Mr Knight also said that he had made enquiries of management and staff since 2 May 2013 and firmly believes that there is no such practice within the Company. The only evidence Mr Knight has found is that there are a “select few individuals” who share emails that do contain sexual content, and this may have been more prolific as far back as 2008, but is not current practice within the business.

[48] Mr Knight also said that he is not part of the email group “Allstaff” and that he had never sent emails with such content to staff or anyone. In reference to the emails attached to Mr Stern’s witness statement, Mr Knight said that he had not sighted these emails previously and had no knowledge that Mr Cronin had any kind of tendencies towards sexually explicit material. Mr Knight was aware of the Pornstars group but is not a member and told either Mr Stern or Mr Cronin that it was not acceptable.

[49] Under cross-examination, Mr Knight said that after Mr Cronin’s dismissal he had taken steps to secure the computer firewall at Choice Homes so that it is harder for inappropriate emails to go through the system and held a general staff meeting where he told staff that Mr Cronin had been dismissed: “due to rude emails directed at people” and warned staff that if this stuff goes on they will get warning letters. Mr Cronin said that Mr Bignill and Mr Stern were at this meeting. Mr Knight also said that appropriate use of email by staff is now monitored by Mr Stern.

[50] In response to the proposition that Mr Bignill had been the original source of a number of offensive emails, Mr Knight said that Mr Bignill is a lower level manager who did not report to him, and that Mr Cronin should have dealt with any inappropriate conduct on the part of Mr Bignill. Mr Knight also maintained that offensive emails sent by Mr Stern and another employee, Ms Mattingly, shown to him in cross-examination should have been dealt with by Mr Cronin.

[51] Mr Knight agreed that he had received two emails with racist content from Mr Stern and Mr Bignill respectively, and one said to be offensive, sent by Mr Cronin to a pregnant employee, in relation to a 17 lb baby. Mr Knight said that he thought that the email about the 17 lb baby was “sick” and in bad taste, and that it appeared his staff had too much time on their hands. Mr Knight also agreed that Mr Stern may not be the appropriate person to monitor the conduct of others with respect to appropriate use of Company email systems.

[52] Mr Saunders was cross-examined about whether he had reprimanded staff of Choice Homes in relation to inappropriate use of company email. Mr Saunders said that after the incident where a female staff member was offended by an email, he had one meeting in 2005 or 2006 where all staff were told not to use Choice Homes email systems for other than work related matters. Another employee in the role of Estimator was given a warning letter because of inappropriate emails.

[53] Mr Knight was shown an email sent by Mr Bignill to Mr Saunders after Mr Saunders had handed over his role to Mr Cronin and was working in the property management part of the Company. That email contains a number of offensive photographs of semi-nude women with breasts and genitals displayed, posing with a person who appears to be the professional golfer, John Daly, entitled “Why John Daly seldom wins on the PGA Tour”.

[54] Mr Knight agreed that the email said that the message about not using Choice Homes’ email system for non-work related emails must have “skipped” Mr Bignall’s mind or that he may not have been present at the meeting where this issue was discussed. Mr Knight also said that Mr Saunders was no longer employed in HR for Choice Homes when he received the email.

Mr Cronin’s role with Choice Homes

[55] Mr Knight said that prior to Mr Cronin commencing employment with Choice Homes, the role of overseeing staff was carried out by Mr Saunders, who always ensured that staff behaved appropriately and stopped inappropriate behaviour straight away. When Mr Saunders moved to another part of the Company, Mr Cronin was employed as Operations Manager and Financial Controller. Appended to Mr Knight’s witness statement was a job description for the role of Chief Operations Officer which included: “oversee all office staff, construction managers & supervisor’s requirements, job descriptions, systems IR & staff training.” 23 Job descriptions headed “Financial Controller/Accountant” and “Accounts Manager” were also appended to Mr Knight’s witness statement.

[56] Mr Knight said that, consistent with these job descriptions, Mr Cronin was responsible for all staffing issues on a day to day basis, and he expected that if there was a problem - such as staff sending inappropriate emails - Mr Cronin would let him know. Mr Saunders said he was involved in the decision to employ Mr Cronin and that Mr Cronin was given a written job description. Mr Saunders also said that he remained with Choice Homes for three to six months after Mr Cronin commenced employment and trained and guided Mr Cronin.

[57] Under cross-examination, Mr Knight said that the three position descriptions appended to his statement were found on Mr Cronin’s file, and in response to the proposition that he could not give evidence of having discussed them with Mr Cronin, Mr Knight said that Mr Cronin did the job files and would have added them into his own file. Mr Knight also agreed that he was not at the initial interview when Mr Cronin was employed and could not point to any documentary evidence of Mr Cronin being provided with the position description setting out the “IR” role. Mr Saunders gave evidence on having provided those position descriptions to Mr Cronin, but could not recall when this occurred.

[58] Mr Knight tendered an email sent to him by Mr Cronin on 17 July 2012, stating that Mr Cronin intended to dismiss an employee, Mr A, after he had driven while intoxicated and concluding with the comment: “I will not bend on this one, you keep asking me to keep control over HR issues, now I am.” 24 Mr Knight said that the email was an example of inappropriate emails that Mr Cronin sent him after hours, but agreed that the incident outlined in the email was a serious health and safety issue. Mr Knight also agreed that after the incident occurred, he conducted an investigation into Mr A’s conduct and got the view of staff about issues in relation to Mr A.

[59] Ms Higgins said that she is responsible for recruitment, performance management and disciplinary action for Metropolitan Property Management and with respect to disciplinary action, sought advice and guidance from Mr Cronin on all steps before they were taken. Ms Higgins gave evidence about several specific disciplinary issues that she had discussed with Mr Cronin and said that he would provide templates and guidance when written communication to a staff member was required. Ms Higgins also said that at staff meetings Mr Cronin would raise topics for discussion such as staff behaviour, dress, drinking and what should or should not be allowed. Mr Cronin also assisted Ms Higgins to resolve an issue between her and Mr Bignill and mediated a resolution to the situation. Ms Higgins said that she understood that Mr Cronin was involved in this issue in his capacity as Human Resource Manager for the Company.

[60] When questioned about whether he had disciplined Mr Bignill in relation to sending inappropriate emails, Mr Saunders said that it was not his role to discipline Mr Bignill because he was part of the management team and Mr Knight had responsibility for disciplining members of the management team. Mr Saunders said that the management team included Mr Bignill, Mr Cronin, and Mr Stern, and that the members of that team came under the complete control of Mr Knight including with respect to discipline. Mr Saunders also said that he reported to Mr Knight that Mr Bignill had been involved in circulating completely inappropriate material by email.

[61] Mr Cronin said that the position description he received as part of his contract of employment did not include reference to “IR” and covered accounting and related tasks 25. Mr Cronin also said that he had never seen any of the job descriptions appended to Mr Knight’s witness statement and they had not been provided to him.

[62] Under cross-examination Mr Cronin maintained that he was not responsible for HR and the email of 17 July 2013, stating that Mr Knight had asked him to keep control of HR issues was just terminology he used on that day, rather than an acceptance that he had been formally required to be HR Manager.

[63] Mr Cronin also said that he did not raise the email culture with Mr Knight as it was already in place when he joined the Company and he generally had no problem with workplace banter. In response to the proposition that the email material exchanged and disseminated by employees of Choice Homes was offensive and inappropriate, Mr Cronin said that he had no complaints about that material and thought it was ok.

The manner in which the dismissal was carried out

[64] After Mr Cronin sent the email on 2 May 2013 he attended a scheduled meeting with Mr Knight, Ms Golato, an accountant for Choice Homes who reported to Mr Cronin and representatives of the Bank of Queensland. Prior to that meeting Ms Bostock and Ms Frazer, legal representatives for Choice Homes arrived at the office and asked Mr Knight whether they could “park” themselves until after the meeting. Mr Cronin was present when they arrived but was not given any indication that the legal representatives were there to see him.

[65] Mr Cronin said that he led the meeting with the Bank of Queensland representatives, at which the future of the Company and upcoming events and activities were discussed. At the end of the meeting Mr Knight walked in the direction of the board room. Mr Cronin returned to his office. Approximately five to ten minutes later, Ms Bostock and Ms Frazer came to Mr Cronin’s office, shut the door and stated that his employment had been terminated effective immediately, for serious misconduct. Mr Cronin was handed the dismissal letter and told that he must immediately leave the workplace.

[66] Mr Cronin was given permission to use the Company vehicle to travel to his home but was instructed to leave all his personal effects in the office and not to speak to any of the staff as he left the office. Ms Golato was asked to attend Mr Cronin’s office so he could identify his boxes of personal items and was told that Mr Cronin had been dismissed. Mr Cronin was escorted to the rear exit of the office by Ms Bostock and Ms Frazer. Mr Cronin was permitted to return to the office to collect his personal items after work hours on the evening of 2 May 2013, when two managers were present to oversee the removal of those items.

[67] Under cross-examination, Mr Cronin agreed that when he entered Mr Knight’s office for the meeting on 2 May 2013 with representatives of the Bank Of Queensland, he asked Mr Knight whether he had liked his email, Mr Knight said “No”.

[68] Mr Knight said under cross-examination that it was his decision to summarily dismiss Mr Cronin. In response to a question as to whether there was an investigation and an opportunity to respond to the allegations, Mr Knight said that he had the evidence in front of him and that Mr Cronin could have responded to Ms Bostock and Ms Frazer. In response to the proposition that the termination letter had been signed before Ms Bostock and Ms Frazer spoke to Mr Cronin, and that they were not going to get Mr Cronin’s version of the story for Mr Knight’s consideration, Mr Knight said: “I was pretty clear with what he sent”.

Other incidents of misconduct

[69] Mr Cronin also gave evidence about misconduct engaged in by employees of Choice Homes and asserted that those employees had not been dismissed. This was said to indicate that Mr Cronin’s conduct had resulted in disproportionate treatment. There was evidence about conduct of Mr A involving Mr A being intoxicated in the office on three occasions from 2011 to 2013. Mr A on one occasion, while intoxicated, spoke in an offensive way to other staff and physically attacked Mr Bignill. In April 2013, Mr A drove a vehicle to the Paradise Point office of Choice Homes in breach of a direction not to drive while intoxicated.

[70] Mr A was issued with a number of warnings including a final warning, but was not dismissed. Mr A was allowed to apologise to staff and was transferred to a position which did not require him to attend licensed venues to build relationships with clients. Another employee Mr C amended a contract for a sale by “forging” the signatures of parties to the contract. This misconduct was discovered by Mr Cronin and investigated by Mr Knight. Mr C admitted to writing the signatures himself and was allowed to resign so that he did not mar his employment record.

[71] That these incidents occurred was not in dispute. Mr Knight said that despite repeated warnings being given to Mr A about drinking during working hours and driving while intoxicated, he had not been dismissed following legal advice that the Company may have contributed to his problem with alcohol by allowing or encouraging him to network with clients in venues where alcohol is served. Mr C was allowed to resign, on the condition that he admitted that he forged the signatures on the contract.

CONSIDERATION OF S.387 MATTERS

Was there a valid reason for Mr Cronin’s dismissal?

[72] Generally, an employee who sends an email inferring that the Chief Executive Office is a “wanker” will be found to have engaged in misconduct. While Mr Cronin’s email was ill-considered, and personally offensive to Mr Knight, in all of the circumstances of this case, the email did not constitute a valid reason for Mr Cronin’s dismissal.

[73] In reaching this conclusion, I accept Mr Cronin’s evidence that the email was intended as a joke. I am also of the view that on an objective basis, no reasonable person could have perceived the email in any other way. There is no basis for finding that Mr Cronin deliberately set out to harass or embarrass Mr Knight. The proposition that the email constituted sexual harassment of Mr Knight by Mr Cronin is unsustainable. The assertion in the dismissal letter that the email contained explicit sexual content is also at odds with Mr Knight’s view that he was being referred to in the email as a “wanker”. While masturbation is sexual, it also has other connotations. On any reasonable view, the email related to the fact that Mr Knight bought a Lamborghini motor vehicle at a point proximate to his twentieth anniversary with Choice Homes.

[74] Mr Knight reacted to the email from Mr Cronin in a way that was disproportionate to its gravity. Mr Stern, who was sitting with Mr Knight when he received the email, knew or at least suspected that it was taken from a website containing humorous Facebook postings, and told Mr Knight that Mr Cronin’s email was not intended to be “that strong”.

[75] No staff member can reasonably have believed that the resume was genuine, particularly given that Choice Homes is Mr Knight’s family company. The fact that staff believed that the email was offensive to Mr Knight, does not amount to them having a view that the email was offensive. I do not accept that there is any evidence that any staff member was personally offended or affronted by the reference to masturbation in the email.

[76] It is not necessary for any person to be offended by an objectively inappropriate email, in order for disciplinary action against the person who disseminated or stored it to be justified. However, in the present case, the evidence establishes that the work environment at Choice Homes was one where employees regularly and habitually exchanged emails, the content of which ranged from light hearted jest to hardcore pornography. The evidence also establishes that senior managers who should have known better were active participants in these exchanges, and that little if anything was done to stop this behaviour.

[77] The emails specifically referred to in this Decision are a small proportion of a significant number of emails tendered by the parties in these proceedings. Those emails run the full gamut of offensiveness and it appears that no stone was left unturned and no depths unplumbed by staff of Choice Homes, in their exchange and dissemination of pornographic, sexually explicit, sexist, racist, scatological and generally derogatory material using the Choice Homes email system.

[78] Staff members of Choice Homes who gave evidence of having taken offence at Mr Cronin’s email of 2 May 2013, were shown to have regularly and systematically disseminated material which on any objective view was much worse than the email which resulted in Mr Cronin’s dismissal. The very fact that there was an email group within Choice Homes called “the Porn Stars” the membership of which included and was updated by the IT Manager, speaks volumes about the attitude of senior management of Choice Homes to the dissemination of highly offensive material in the workplace.

[79] The proposition that Mr Bignill or Mr Stern would have been offended at the use of the term “masturbation” is ludicrous, when viewed in the context of their predilection for hard core pornography and other highly offensive material. Mr Knight’s concern about offence which may have been taken by female staff of Choice Homes to Mr Cronin’s email is also ludicrous when consideration is given to the active involvement of female staff of Choice Homes in circulating highly offensive material.

[80] Indeed some of the female staff appeared to have given Mr Bignill and Mr Stern some serious competition in this regard. Of particular concern is an email depicting a very young boy looking down the front of the pants of what appears to be a large female doll with oversized lips, captioned: “CURIOSITY We’re all born with it” and an image of a child standing in front of what appears to be a rack of adult magazines. The details on this email indicate that it was sent from an email address at a school, to a female staff member of Choice Homes, who then disseminated it to “Allstaff”. The email also includes other images derogatory of lesbians, people who are overweight, homeless people and generally offensive language.

[81] I do not accept that Mr Knight was as oblivious to the conduct of his senior management team as he alleges. Whether Mr Cronin was responsible for industrial relations or human resource management issues for Choice Homes or not, the evidence of Mr Saunders clearly establishes that Mr Knight was responsible for disciplining members of the management team which included Mr Bignill, Mr Stern and Mr Saunders. Further, Mr Saunders stated in his evidence that he told Mr Knight that Mr Bignill had been involved in disseminating pornographic emails. There is no evidence that Mr Knight disciplined any of those persons about inappropriate emails, notwithstanding that Mr Knight received two emails that on any view are extremely racist and highly inappropriate.

Was Mr Cronin notified of the reason for his dismissal?

[82] It is not in issue that the letter handed to Mr Cronin on 2 May 2013 notified him of the reason for his dismissal.

Was Mr Cronin given an opportunity to respond to any reason related to his capacity or conduct?

[83] Mr Cronin was dismissed on the ground of serious misconduct. He had no opportunity to respond to the reasons for his dismissal related to his conduct. The dismissal letter was written in advance, and Mr Knight sent his lawyers into Mr Cronin’s office for the sole purpose of summarily dismissing Mr Cronin. Notwithstanding Mr Knight’s evidence that Mr Cronin could have discussed the matter with the solicitors who acted on behalf of Mr Knight to effect the dismissal, I do not accept that in the space of time between being told that he was dismissed and handed the letter of dismissal, that Mr Cronin had any opportunity to respond to the reason for the dismissal.

[84] It was also apparent from Mr Knight’s evidence, that any response on the part of Mr Cronin would have been an exercise in futility, given the steps Mr Knight took within a very short space of time after receiving that email to summon his solicitors, cause a letter of dismissal to be written and dispatch the solicitors to dismiss Mr Cronin.

Was there an unreasonable refusal by the employer to allow Mr Cronin to have a support person present to assist at any discussions relating to the dismissal?

[85] There was no refusal to allow Mr Cronin to have a support person present. However given the manner in which the dismissal was effected, Mr Cronin could not have known that he had any need to have a support person present.

Was Mr Cronin warned about any unsatisfactory performance before the dismissal?

[86] There is no evidence that Mr Cronin received any warnings about unsatisfactory work performance. Mr Knight attempted to assert that he had some concerns about Mr Cronin sending him emails late at night containing content that upset him. In support of this assertion, Mr Knight tendered an email in which Mr Cronin informs him of concerns about Mr A driving a motor vehicle away from the workplace while intoxicated and of Mr Cronin’s intention to dismiss Mr A.

[87] In my view the email sent by Mr Cronin about this matter raises a legitimate concern and can in no way be viewed as an attempt by Mr Cronin to upset Mr Knight. This is particularly so given Mr Knight’s insistence that Mr Cronin was responsible for HR. There is also no evidence that Mr Cronin was ever warned about that email or any other email, prior to his dismissal.

Did the size of the enterprise impact on the procedures followed in effecting Mr Cronin’s dismissal?

[88] Choice Homes has some 40 employees and this factor has not impacted on the procedures followed in effecting Mr Cronin’s dismissal.

Did the absence of dedicated human resource management specialists or expertise in the enterprise impact on the procedures followed in effecting Mr Cronin’s dismissal?

[89] Choice Homes had access to legal assistance in effecting Mr Cronin’s dismissal and this is not a relevant factor.

Any other matters the Commission considers relevant

[90] My view about the culture at Choice Homes is fortified by a number of other matters that I consider to be relevant to the issue of whether Mr Cronin’s dismissal was unfair. If Mr Knight did not know the extent of the conduct that his employees and managers were engaging in at the point he decided to dismiss Mr Cronin, he could have been in no doubt when Mr Cronin filed his witness statement in these proceedings.

[91] Mr Knight’s attempts to portray Mr Cronin as being responsible for the management of this issue were entirely unconvincing. Mr Knight’s evidence about this was contradicted by his own witness, Mr Saunders, who made it clear that discipline of members of the management team, who appear to have been among the worst perpetrators in terms of disseminating inappropriate material, was Mr Knight’s responsibility.

[92] Mr Knight’s evidence that he had taken steps to manage the issue after Mr Cronin’s dismissal by installing a fire wall and having a general meeting with staff to warn them about the inappropriate use of Choice Homes’ email systems, was contradicted by Mr Stern and Mr Bignill. It is also contradicted by the fact that Mr Stern was still disseminating inappropriate emails from his Choice Homes account to persons including Mr Cronin, after Mr Cronin’s dismissal. This is at odds with Mr Knight’s evidence that Mr Stern is in charge of monitoring Choice Homes email systems to ensure they are used appropriately, or that any steps were taken to address the issue of inappropriate use of Choice Homes’ email systems, after Mr Cronin’s dismissal.

[93] Generally, I found Mr Knight to be an unconvincing witness, bent on painting Mr Cronin as a person who has “tendencies towards sexually explicit material”, while glossing over the fact that his senior staff (including two relatives) were much worse offenders. Mr Knight’s’ attempts to depict himself as having no knowledge of what was going on at Choice Homes was improbably. Mr Knight’s evidence that he had taken steps to prevent the inappropriate use of Choice Homes email after Mr Cronin’s dismissal, was implausible and flatly contracted by the evidence of his own witnesses. Of particular concern was Mr Knight’s attempt to fix responsibility for managing use of email systems on Mr Cronin in the face of evidence from Mr Saunders that the worst offenders (including Mr Knight’s relative Mr Bignill) were subject to discipline from Mr Knight only, on the basis that they were senior managers.

[94] This is not a case where an employer had a firm and well established policy about use of its electronic communication system for the dissemination of inappropriate material and dismissed an employee for breach of that policy. It is also not a case where a decision to uphold Mr Cronin’s dismissal would support an employer striving to stop inappropriate email traffic. In fact, to the contrary, to uphold Mr Cronin’s dismissal would support an employer who has dealt disproportionately with employees who have engaged in much more serious misconduct.

[95] In this regard, it is relevant that an employee who assaulted a co-worker while intoxicated and was repeatedly offensive to colleagues, and capped off his misconduct by driving away from the workplace while intoxicated thereby breaching conditions stipulated in a final warning, was allowed to apologise to colleagues and was retained in employment. Mr Cronin was not given a similar opportunity.

[96] It is also the case that Mr Cronin was summarily dismissed, on grounds that he had engaged in serious misconduct involving dissemination of sexually explicit material. When misconduct as defined in Regulation 1.07 is considered, Mr Cronin’s conduct was not of the kind described.

CONCLUSIONS

[97] After considering the evidence and the criteria in s.387 I have concluded that Mr Cronin’s dismissal was unfair because it was harsh, unjust and unreasonable. The dismissal was harsh because it had significant consequences for Mr Cronin. Mr Cronin had secure and long term employment for a period in excess of six years. He has subsequently been unable to find a position that is ongoing and has secured contract employment only.

[98] It was unjust because the email was intended as a joke and Mr Knight’s reaction to it was disproportionate to the gravity of Mr Cronin’s conduct. The response to Mr Conin’s email on 2 May 2013 was also disproportionate when it is viewed in the context of the workplace culture at Choice Homes and the misconduct engaged in by other employees who were not dismissed. The completely unjust manner in which the dismissal was effected also resulted in Mr Cronin having no opportunity to offer an apology to Mr Knight, and to retain his employment.

[99] The dismissal was unreasonable because the conclusion that the email was inappropriate because it contained sexually explicit material, could not reasonably have been reached in circumstances where the reference to masturbation was clearly not sexual and there was a workplace culture of distributing and disseminating emails that tick every box in the spectrum of highly offensive material including hard core pornography, sexism and racism and where more serious misconduct engaged in by other employees did not result in dismissal. The dismissal was also unreasonable because on any objective view, the email sent by Mr Cronin on 2 May 2013, was intended as a joke.

[100] As required by s.390 of the Act, I am satisfied that Mr Cronin was protected from unfair dismissal and that he has been unfairly dismissed. Mr Cronin should have a remedy for his unfair dismissal. Mr Cronin does not seek reinstatement, and after hearing Mr Knight’s evidence, the prospect of re-establishing the employment relationship is nil. On that basis I am satisfied that reinstatement is not appropriate and that an award of compensation should be made.

[101] Mr Cronin has secured a six month contract position for which he is paid $50 per hour. His legal representative has provided a Schedule of compensation, based on hourly rates with his salary at Choice Homes being calculated as a notional hourly rate based on a 38 hour week. I do not accept that this is a valid basis for calculating compensation, given that there is no evidence that Mr Cronin worked a 38 hour week while employed by Choice Homes.

[102] Section 392 of the Act provides as follows in relation to the remedy of compensation:

“392 Remedy—compensation

Compensation

(1) An order for the payment of compensation to a person must be an order that the person’s employer at the time of the dismissal pay compensation to the person in lieu of reinstatement.

Criteria for deciding amounts

(2) In determining an amount for the purposes of an order under subsection (1), the FWC must take into account all the circumstances of the case including:

(a) the effect of the order on the viability of the employer’s enterprise; and

(b) the length of the person’s service with the employer; and

(c) the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed; and

(d) the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal; and

(e) the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for compensation; and

(f) the amount of any income reasonably likely to be so earned by the person during the period between the making of the order for compensation and the actual compensation; and

(g) any other matter that the FWC considers relevant.

Misconduct reduces amount

(3) If the FWC is satisfied that misconduct of a person contributed to the employer’s decision to dismiss the person, the FWC must reduce the amount it would otherwise order under subsection (1) by an appropriate amount on account of the misconduct.

Shock, distress etc. disregarded

(4) The amount ordered by the FWC to be paid to a person under subsection (1) must not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt, caused to the person by the manner of the person’s dismissal.

Compensation cap

(5) The amount ordered by the FWC to be paid to a person under subsection (1) must not exceed the lesser of:

(a) the amount worked out under subsection (6); and

(b) half the amount of the high income threshold immediately before the dismissal.

(6) The amount is the total of the following amounts:

(a) the total amount of remuneration:

(i) received by the person; or

(ii) to which the person was entitled;

(whichever is higher) for any period of employment with the employer during the 26 weeks immediately before the dismissal; and

(b) if the employee was on leave without pay or without full pay while so employed during any part of that period—the amount of remuneration taken to have been received by the employee for the period of leave in accordance with the regulations.”

[103] The approach to the calculation of compensation is set out in a decision of a Full Bench of the Australian Industrial Relations Commission in Sprigg v Paul’s Licensed Festival Supermarket 26. In accordance with that approach, and s.392 of the Act, I calculate compensation as follows.

[104] At the point he was dismissed, Mr Cronin had been employed in a senior position with Choice Homes for over 6 years. There was no evidence of any issue being taken with his conduct, capacity or work performance in that period. In my estimation, but for his dismissal, in a manner and upon grounds which made the dismissal unfair, Mr Cronin would have remained in employment for a period of at least a further twelve months and for that period would have received remuneration of $205,000.00 in accordance with his employment contract.

[105] Mr Cronin was dismissed on 2 May 2013 and did not obtain alternative employment until 15 July 2013 when he commenced a six month contract. Mr Cronin is engaged under that contract on a “full time” basis at the rate of $50 per hour. No evidence was provided about what constitutes “full time” employment under the contract and how many hours per week are worked by Mr Cronin. For the purpose of calculating compensation, I assume that Mr Cronin is working 38 hours per week and receiving a weekly payment of $1900.00. On the basis of a 26 week period, I estimate that Mr Cronin’s earnings under this contract totalled $49,400.00 for the period from 15 July until 13 January 2014. This period includes the period up to the making of the order for compensation which will follow this decision.

[106] When the amount of $49,400.00 is deducted from Mr Cronin’s salary of $205,000.00 the resultant amount is $155,600.00. It is then necessary to discount this amount for contingencies. I have concluded that the level of discount should be 50% in this case. Mr Knight did not strike me as a person who would easily have gotten over the offence he took at Mr Cronin’s email, and had Mr Cronin not been dismissed following the email being sent, I am of the view that there is a strong possibility that he and Mr Knight would have parted ways at some point in the not too distant future. Applying a 50% discount for contingencies, reduces the amount of $155,600.00 to $77,800.

[107] For the reasons set out above, while I do not consider that Mr Cronin engaged in serious misconduct so that the email he sent on 2 May 2013 provided a valid basis for his dismissal. However, I am of the view that the email constituted poor judgment on the part of Mr Cronin and that as a general rule, sending an insulting email to the Chief Executive, does constitute misconduct. Notwithstanding the environment in which Mr Cronin worked, there is some force in the submission that this email was directed to Mr Knight personally and constituted Mr Cronin calling Mr Knight a “wanker”, probably in reference to his purchase of a Lamborghini motor vehicle.

[108] Accordingly Mr Cronin did make a contribution to the situation in which he found himself on 2 May 2013, and I have concluded that the amount of compensation awarded to him should be adjusted by 20% for that reason. Making that adjustment results in an amount of $62,000.00. That amount is to be paid to Mr Cronin within 21 days of the date of release of this decision. An Order to that effect will follow.

DEPUTY PRESIDENT

Appearances:

Ms A. Milner, Solicitoron behalf of the Applicant.

Mr J. Yeatman and Ms S. Bostock, Solicitorson behalf of the Respondent.

Hearing details:

2013.

Brisbane:

September 18, 19.

Final written submissions:

27 September 2013.

 1   Edwards v Giudice 94 FCR 561.

 2   Selverchandron v Peteron Plastics Pty Ltd (1995) 62 IR 371 at 373.

 3   Rode v Burwood Mitsubishi Print R4471 at [90] per Ross VP, Polites SDP, Foggo C.

 4   Miller v University of NSW [2003] FCAFC 180 at pn 13, 14 August 2003, per Gray J.

 5   Farrugia v Transadelaide SAIR 6.

 6   King v Freshmore Print S4213.

 7   Walton v Mermaid (1996) 142 ALR 681 at 685.

 8   Stewart v University of Melbourne (U No 30073 of 1999 Print S2535) Per Ross VP citing Byrne v Australian Airlines (1995) 185 CLR 410 at 465-8 per McHugh and Gummow JJ.

 9   Boral Resources (Queensland) Pty Ltd v Pyke [1992] 2 Qd R 25 at 42 per Derrington J.

 10   Ibid at 42.

 11   PR974391 AIRC 663.

 12   Exhibit 1 - Witness Statement of Paul Cronin.

 13   Exhibit 3 - Witness Statement of Troy Jason Knight.

 14   Exhibit 6 - Witness Statement of Glynn Catherall.

 15   Exhibit 7 - Witness Statement of Steve Bignill.

 16   Exhibit 11 - Witness Statement of Jonathan Stern.

 17   Exhibit 18 - Witness Statement of Barbara Colman.

 18   Exhibit 19 - Witness Statement of Philip Anthony Saunders.

 19   Exhibit 20 - Witness Statement of Kelly Mae Higgins.

 20   Exhibit 8 and page 43 of the emails annexed to Exhibit 1 - Witness Statement of Paul Cronin.

 21   Exhibit 9.

 22   Exhibit 10.

 23   Exhibit 3 - Witness Statement of Troy Jason Knight - Annexure C1, C2 and C3.

 24   Ibid - Annexure D1.

 25   Exhibit 1 - Witness Statement of Paul Cronin - Annexure A page 15.

 26 (1998) 88 IR 21

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