Mr Peter Aitken v CUB Pty Ltd
[2016] FWCFB 4104
•1 AUGUST 2016
| [2016] FWCFB 4104 |
| FAIR WORK COMMISSION |
DECISION |
Fair Work Act 2009
s.604 - Appeal of decisions
v
CUB Pty Ltd
(C2016/3720)
SENIOR DEPUTY PRESIDENT DRAKE | SYDNEY, 1 AUGUST 2016 |
Appeal against decision [[2016] FWA 2668] of Deputy President Clancy at Melbourne on 29 April 2016 in matter number U2015/15101.
Introduction
[1] Mr Peter Aitken (Mr Aitken) applies for permission to appeal a Decision and Order issued by Deputy President Clancy on 29 April 2016 1 (the Decision). In the Decision and Order the Deputy President found that Mr Aitken was not unfairly dismissed from his employment with CUB Pty Ltd (CUB) and dismissed his application under s.394 of the Fair Work Act 2009 (the Act) for an unfair dismissal remedy.
[2] The reasons given by CUB for dismissing Mr Aitken, as set out by the Deputy President in his Decision, are as follows:
“The reason CUB gave for the dismissal of Mr Aitken was that his conduct was ‘inconsistent with the trust and confidence required in the employment relationship’, 2 having previously conveyed the following findings in a letter regarding the outcome of an investigation into his conduct at work:
“…
There is a substantive history of you holding a disregard for adhering to basic policies and procedures at Abbotsford as documented on your file including two written warnings and a file note including not adhering to the site smoking policy in 2012.
As part of your return to work in 2014 following an extended absence on a non-work related event, clear expectations were outline [sic] including adherence to the safety of yourself and others at work including ensuring the ongoing capacity of you to fulfil the requirements of your role as a Warehouse Operator.
You admitted to breaching the site safety policy when caught smoking outside of a designated smoking area on the 1st October 2015.
In weighing up the events on the 13th October…it is on the basis of reasonable probability that you were caught again smoking whilst operating [a] forklift when stopped by the Warehouse Manager.
…” 3
Background facts
[3] In order to understand the submissions in relation to the grounds of appeal advanced by Mr Aitken, it is necessary to set out some of the facts. Mr Aitken commenced employment with CUB in or around October 1995, as a warehouse employee and worked at the Abbotsford Brewery from 2007. In late 2013, Mr Aitken suffered a serious psychological breakdown and resigned his employment in December 2013. Following the intervention of the Construction, Forestry, Mining and Energy Union (the CFMEU) on behalf of Mr Aitken, agreement was reached with CUB in which Mr Aitken returned to work, received back-pay and his prior service was acknowledged, although he did not receive accruals of leave for the period of his absence.
[4] The conditions under which Mr Aitken returned to work were set out in a letter dated 6 March 2014 from CUB to Mr Aitken, which included a statement to the effect that should CUB become concerned with Mr Aitken’s capacity to work, or be aware of any issues that impacted on his health and safety and those of other employees, or the Company’s obligation to provide a safe and healthy workplace, those matters would be immediately addressed with Mr Aitken. CUB submitted that this letter provided context for Mr Aitken’s re-engagement and served to remind him that he was receiving a fresh start, would effectively become a probationary employee and would be watched and any issues addressed.
[5] The Deputy President noted in relation to the re-engagement of Mr Aitken that:
“Mr Aitken’s subsequent submission was that the whole of his employment had to be looked at and he did not accept the proposition that there was a measure of trust when he returned to work in 2014 that he would take the opportunity that he had been given and make the most of it, which in turn framed the way in which subsequent safety breaches would be viewed.” 4
[6] The Deputy President also noted evidence from witnesses for CUB to the effect that the arrangements outlined in the letter of 6 March 2014 were consistent with the standard approach for employees returning to work but that the intent of the letter was to alert Mr Aitken to the fact that if issues arose in the future that impacted the health and safety of Mr Aitken or other employees of CUB, these would be immediately addressed. In this regard, the Deputy President found that:
“CUB had attempted to persuade Mr Aitken not to resign in December 2013 but he could not be shifted on his decision. When he sought to return a few months later, CUB and the CFMEU negotiated a set of conditions that are rare and commendable in that he was back paid for three months and had his prior service acknowledged. I regard it as significant that there was specific reference to CUB’s intention to immediately address issues that arose that impact the health and safety of Mr Aitken, other employees and CUB’s obligation to provide a safe workplace. I am satisfied the re-engagement of Mr Aitken was a significant event and provides some context for the way in which the events that followed would be viewed.” 5
[7] The Decision of the Deputy President also outlined a number of earlier warnings that had been given to Mr Aitken as follows:
● February 2012 – written warning for leaving workplace prior to completion of shift;
● May 2012 – verbal warning for smoking outside of a designated smoking area; and
● November 2014 – written warning in relation to failing to comply with safe loading procedure.
[8] The Deputy President noted that Mr Aitken disputed or did not recall these warnings. The Decision also recorded that there were two incidents in October 2015 when Mr Aitken was alleged to have been smoking outside of a designated smoking area. In relation to the first of these incidents, which occurred on 1 October 2015, it was not in dispute that Mr Aitken was observed by a manager to be smoking outside a designated area. Mr Aitken claimed that the manager had previously stated that he did not care if employees smoked outside and that other employees also smoked in that area. The manager denied that this was the case. In relation to this incident, Mr Aitken agreed that he was smoking in an area that was close to a gas bottle on his forklift; there was a nearby gas storage facility; and that his conduct was a breach of a well-known policy. Mr Aitken went to the manager’s office and was told that there would be a follow-up meeting and the manager made a file note of the meeting. No further formal action was taken in relation to this incident in the seven working days before the next alleged incident on 13 October 2015.
[9] The incident of 13 October 2015 involved an allegation that Mr Aitken was smoking while he was operating a forklift. After reviewing the evidence about this incident, the Deputy President concluded that he could not be satisfied on the balance of probabilities that Mr Aitken was smoking while operating a forklift in the warehouse. However, the Deputy President went on to find that there was a valid reason for Mr Aitken’s dismissal on the basis that he had a substantive history of holding a disregard for adhering to site policies and procedures. His Honour also found that the arrangements and expectations around Mr Aitken’s return to work in March 2014 provided context for the way in which his breaches of site safety rules following his return should be viewed, and that Mr Aitken’s conduct in smoking outside a designated area on 1 October 2015 demonstrated indifference to safety rules and was alarming.
[10] The Deputy President went on to conclude that CUB’s initial response to the smoking incident on 1 October 2015 did not diminish its significance or the concern that should be felt about his underlying attitude to smoking on site, and that this was a valid reason for his dismissal and was regarded by CUB as one of the heads of the findings it relied on for the dismissal. His Honour also said that:
“Given this pattern of behaviour, I am satisfied that CUB’s reason for terminating Mr Aitken’s employment was valid. Even without being able to rely on the alleged smoking incident of 13 October 2015, Mr Aitken had consistently demonstrated that he could not or would not comply with reasonable fundamental site rules, directions and procedures, particularly those relating to safety, despite warnings he had received along the way. I am satisfied that this pattern of conduct was ultimately inconsistent with the trust and confidence required for a continuing employment relationship.” 6
[11] The Deputy President went on to consider the other factors in s.387 of the Act and made a finding that the dismissal of Mr Aitken was not unfair.
Grounds of appeal
[12] The grounds of appeal set out in the Form F7 Notice of Appeal were that:
● The finding in paragraph [86] was a significant error of fact as to the purpose and intent of the letter sent to Mr Aitken on 6 March 2014;
● The finding that there was a valid reason for dismissal is unsound in circumstances where:
○ the Deputy President made a positive finding that Mr Aitken did not engage in the misconduct alleged to have occurred on 13 October 2015;
○ that misconduct precipitated his dismissal;
○ CUB had full knowledge of the incident of 1 October 2015 and had not taken any disciplinary steps at all in relation to it; and
○ absent the conduct of 13 October, the conduct of 1 October 2015 was not a valid reason for dismissal.
[13] These factors were also said to make the Decision appealable at law because it was not reasonable to conclude, on the basis of the facts found, that there was a valid reason for dismissal. In relation to public interest, it was contended that the Deputy President’s Decision addresses the question of the application of the principles laid down by the High Court in Shepherd v Felt and Textiles of Australia Ltd. 7 In the matter before the Deputy President it was submitted that CUB had full knowledge of the misconduct on 1 October 2015, relied on as part of the reasons for dismissal, and took no action to discipline or otherwise counsel Mr Aitken in relation to it. It was submitted that the Deputy President incorrectly applied the principles in Shepherd in those circumstances.
[14] This argument was developed in the written submissions filed in the appeal on behalf of Mr Aitken. It was contended that the public interest is engaged in circumstances where the failure of CUB to take any steps to discipline Mr Aitken in the period between the incident on 1 October and the incident on 13 October 2015, or to provide a reasonable explanation for that failure, amounts to condonation of Mr Aitken’s conduct. Further it is contended that this lack of action is inconsistent with the assertion of CUB that Mr Aitken’s course of conduct destroyed the necessary relationship of trust.
[15] It was also asserted that the Deputy President erred in law because CUB:
● did not have a valid reason, absent the misconduct of 13 October, to dismiss Mr Aitken; and
● having failed to take any action against Mr Aitken for the incident of 1 October 2015, condoned the behaviour and/or waived its rights in relation to it.
[16] A significant error of fact was asserted on the basis that at paragraph [83] of the Decision (extracted above), the Deputy President characterised the submission of Counsel for Mr Aitken, in response to the proposition recounted, as not accepted in whole, and that the Deputy President was wrong to conclude that Mr Aitken did not accept the proposition at all. Counsel for Mr Aitken had in fact submitted that while CUB’s conduct in allowing Mr Aitken to return to work was commendable, it was not a warrant to hold Mr Aitken to a higher standard than anyone else.
[17] It was submitted that this significant error of fact appeared to have led to a further significant error of fact – a wrong conclusion that the terms of the letter of 6 March 2014 were directed to Mr Aitken’s safety history. The words in the letter, according to the evidence of its author, were consistent with the standard approach for employees returning to work. This was said to be a significant error of fact with significant consequences, in that implicit in paragraph [83] of the Deputy President’s Decision is that CUB’s agreement to permit Mr Aitken to return to work in 2014 had the effect of imposing on Mr Aitken a higher standard than that which applied to other employees.
[18] In oral submissions at the hearing where permission to appeal was sought, the argument was further developed and it was asserted that Mr Aitken had been denied procedural fairness at the hearing on the basis that it had never been put by CUB that the conduct of 1 October, standing alone, was a valid reason for dismissal. Counsel for Mr Aitken contended in the permission to appeal hearing that had this proposition been argued in the alternative it would have been expressly put to the Deputy President that the failure on the part of CUB to take steps after the conduct of 1 October meant that the conduct was condoned, and in any event it could not be said that the conduct of 1 October alone constituted a valid reason for the dismissal. Had that proposition been squarely put, it would have been addressed on behalf of Mr Aitken, by reference to the doctrine of condonation. It was also contended that to the extent that the Deputy President dealt with the question of whether the conduct of 1 October was condoned by CUB, he did so in a single paragraph, without any reference to the relevant law.
Legislative provisions
[19] An appeal under s.604 of the Act is an appeal by way of rehearing and the Commission’s powers on appeal are only exercisable if there is error on the part of the primary decision maker. 8 There is no right to appeal and an appeal may only be made with the permission of the Commission.
[20] This appeal is one to which s.400 of the Act applies. 9 Section 400 of the Act provides:
(1) Despite subsection 604(2), the FWC must not grant permission to appeal from a decision made by the FWC under this Part unless the FWC considers that it is in the public interest to do so.
(2) Despite subsection 604(1), an appeal from a decision made by the FWC in relation to a matter arising under this Part can only, to the extent that it is an appeal on a question of fact, be made on the ground that the decision involved a significant error of fact.
[21] In the Federal Court Full Court decision in Coal & Allied Mining Services Pty Ltd v Lawler and others, Buchanan J (with whom Marshall and Cowdroy JJ agreed) characterised the test under s.400 as “a stringent one”. 10 The task of assessing whether the public interest test is met is a discretionary one involving a broad value judgment.11 In GlaxoSmithKline Australia Pty Ltd v Makin a Full Bench of the Commission identified some of the considerations that may attract the public interest:
... the public interest might be attracted where a matter raises issues of importance and general application, or where there is a diversity of decisions at first instance so that guidance from an appellate court is required, or where the decision at first instance manifests an injustice, or the result is counter intuitive, or that the legal principles applied appear disharmonious when compared with other recent decisions dealing with similar matters. 12
[22] It will rarely be appropriate to grant permission to appeal unless an arguable case of appealable error is demonstrated. This is so because an appeal cannot succeed in the absence of appealable error. 13 However, the fact that the Member at first instance made an error is not necessarily a sufficient basis for the grant of permission to appeal.14
Consideration
[23] We do not consider that an arguable case of appealable error has been established. As Counsel for CUB put the matter in the hearing in relation to permission to appeal, there is absolute orthodoxy about the way in which the Deputy President approached the critical question that the Act required him to decide under s. 387(a): was there a valid reason for the dismissal?
[24] The well-established approach to considering whether there is a valid reason for a dismissal is set out in the Decision of Justice Northrop in Selverchandran v Peteron Plastics 15 where his Honour observed that:
“…the adjective ‘valid’ should be given the meaning of sound, defensible or well founded. A reason which is capricious, fanciful, spiteful or prejudiced could never be a valid reason … At the same time the reason must be valid in the context of the employee’s capacity or conduct or based upon the operational requirements of the employer’s business. Further, in considering whether a reason is valid, it must be remembered that the requirement applies in the practical sphere of the relationship between an employer and an employee where each has rights and privileges and duties and obligations conferred and imposed upon them. The provisions must ‘be applied in a practical and commonsense way to ensure that’ the employer and employee are each treated fairly…” 16
[25] We see no arguable case of appealable error in the approach adopted by the Deputy President in determining that there was a valid reason for the dismissal of Mr Aitken. There was no dispute that the conduct engaged in by Mr Aitken on 1 October 2015 breached CUB’s policy in relation to smoking. That evidence included that Mr Aitken was smoking in a non-designated area, which was in proximity to a gas bottle on his forklift and to a gas storage area. We do not consider that there is an arguable case of appealable error in relation to this finding.
[26] His Honour concluded that this conduct, and Mr Aitken’s evidence in the hearing, showed an indifference to smoking rules, which was concerning. Consideration was also given to other relevant factors, including that Mr Aitken had been given a new opportunity for employment after his resignation and there was an expectation that he would make the most of it, including complying with CUB’s safety policies. This was properly seen by the Deputy President as being part of the overall context relevant to the question of whether there was a valid reason for Mr Aitken’s dismissal. We have not been taken to any material that supports the submission that Mr Aitken was in fact held to a higher standard than other employees, or that the Deputy President erred in his consideration of these matters.
[27] Further, we do not accept that there is an arguable case of appealable error in relation to his Honour’s consideration of whether CUB condoned Mr Aitken’s conduct. That issue was considered and dealt with in the Decision at paragraph [126]. On the evidence before the Deputy President it was open to him to conclude that the conduct was not condoned and that the subsequent allegations of a further breach of CUB’s smoking policy, within a relatively short time, overtook the events of 1 October. The incident of 1 October was taken up with Mr Aitken and the fact that it was not relied on to terminate his employment at the time it occurred, does not reduce its significance as part of the overall factual matrix, which was found to constitute a valid reason for Mr Aitken’s dismissal.
[28] The circumstances in which Mr Aitken returned to work in 2014 were part of the overall factual matrix in which the Deputy President considered the matters he was required to determine and we see no error in that consideration. Whether Mr Aitken accepted a proposition about this matter in whole, or in part, does not in our view constitute a significant error of fact and no arguable case of appealable error is made out on this point.
[29] Further, we do not accept that there was any denial of procedural fairness. A perusal of the transcript indicates that Mr Aitken’s representative made submissions about condonation and responded to the proposition that the conduct of 1 October standing alone was a valid reason for the dismissal.
[30] We are not satisfied that it is in the public interest to grant permission to appeal. We do not agree that the principle in Shepherd v Felt and Textiles of Australia 17– a breach of contract case concerning conduct not known about at the point the contract was terminated – is relevant to, or intersects with this case. No other public interest considerations have been identified. Nor, as we indicate above, are we persuaded that there is an arguable case of error in relation to the decision subject to appeal or that there are any other considerations that warrant the grant of permission to appeal. Accordingly permission to appeal is refused.
SENIOR DEPUTY PRESIDENT
Appearances:
Ms S Kelly for the Appellant.
Mr M Harrington for the Respondent.
Hearing details:
2016.
Melbourne.
16 June.
Final written submissions:
15 June 2016.
1 [2016] FWC 2668 and PR579733 respectively.
2 Exhibit A1-Annexure PA-7.
3 [2016] FWC 2668 at [2].
4 Ibid at [83].
5 Ibid at [86]
6 [2016] FWC 2668 at [127].
7 (1931) 45 CLR 359.
8 Coal and Allied Operations Pty Limited v Australian Industrial Relations Commission and Others (2000) 203 CLR 194 at [17] per Gleeson CJ, Gaudron and Hayne JJ.
9 See Australia Postal Corporation v Gorman [2011] FCA 975 at [37].
10 (2011) 192 FCR 78 at [43].
11 O’Sullivan v Farrerand Another (1989) 168 CLR 210 per Mason CJ, Brennan, Dawson and Gaudron JJ; applied in Hogan v Hinch (2011) 85 ALJR 398 at [69] per Gummow, Hayne, Heydon, Crennan, Kiefel and Bell JJ; Coal & Allied Mining Services Pty Ltd v Lawler and others (2011) 192 FCR 78 at [44] -[46].
12 [2010] FWAFB 5343 at [27], 197 IR 266.
13 Wan v Australian Industrial Relations Commission (2001) 116 FCR 481 at [30].
14 GlaxoSmithKline Australia Pty Ltd v Makin[2010] FWAFB 5343 at [26]-[27], 197 IR 266; Lawrence v Coal & Allied Mining Services Pty Ltd t/as Mt Thorley Operations/Warkworth[2010] FWAFB 10089 at [28], 202 IR 288, affirmed on judicial review in Coal & Allied Mining Services Pty Ltd v Lawler and Others (2011) 192 FCR 78; New South Wales Bar Association v Brett McAuliffe; Commonwealth of Australia represented by the Australian Taxation Office [2014] FWCFB 1663 at [28].
15 (1995) 62 IR 371.
16 Ibid at 373.
17 (1931) 45 CLR 359.
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