Perkins v Grace Worldwide (Aust)
[1996] IRCA 343
•30 July 1996
DECISION NO: 343/96
CATCHWORDS
INDUSTRIAL LAW - TERMINATION OF EMPLOYMENT - SERIOUS MISCONDUCT - allegation of supplying marijuana to employees - whether proper investigation or sufficient inquiry into the circumstances - ONUS OF PROOF.
Industrial Relations Act 1988 s.170DE]
Byrne -v- Australian Airlines Ltd (1994) 47 FCR 300
Bio-Lo Pty Ltd -v- Hooper (1994) 53 IR 224
Briginshaw -v- Brignishaw (1938) 60 CLR 336
STEPHEN JAMES PERKINS -v- GRACE WORLDWIDE (AUST) PTY LTD
No. NI 1208 of 1996
COURT: WALKER JR
PLACE: SYDNEY
DATE: 30TH JULY 1996
INDUSTRIAL RELATIONS COURT
OF AUSTRALIA
SYDNEY REGISTRY
No. NI 1208 of 1996
BETWEEN:
STEPHEN JAMES PERKINS
Applicant
AND:
GRACE WORLDWIDE (AUST) PTY LTD
Respondent
BEFORE: WALKER JR
PLACE: SYDNEY
DATE: 30TH JULY 1996
REASONS FOR JUDGMENT
Stephen James Perkins was employed by the respondent for approximately eight and a half years. At the time of the termination, he was the Sydney Metropolitan Fleet Controller for Grace Worldwide Australia Pty Ltd. He said that during his employment he had never been formally questioned or warned in anyway concerning his work performance. However on the 22 January 1996, he was called into the office of Mr Stuart Pepper, the Branch Manager and was summarily dismissed.
Mr Perkins gave the following evidence,
“At approximately 5.30, Stuart Pepper called me into his office and
there was just he and I there and he said to me that he’d spent most of the day at head office as I was probably aware and I said, well yes I had heard he’d been there, although I wasn’t formally notified that he was down there. He said that he was down there because of two accusations that I was dealing in drugs at Grace Removals and the company and himself thought that this was a gross misconduct and it was an illegal activity that I was involved in and he handed me a letter of dismissal and told me to leave the premises.”
The applicant said this meeting lasted for about five minutes, he had said to Mr Pepper that the allegations were, “bullshit”. He was then driven home by Mr Stuart Pepper and the supervisor Mr Simon Reynolds.
When asked if he was made aware of these allegations prior to the 22 January 1995, the applicant said,
“I heard on the grapevine through the employees that work at Grace Removals, that there were discussions that certain persons in the company were trying to set me up for drugs. I thought it was a big joke and you know, there was obviously somebody disgruntled out there, wasn’t happy with what had transpired in the past and it wouldn’t be the first time, that I’ve had, you know-- a disgruntled driver or somebody out in the field that was unhappy with a decision that I’d made and tried to get rid of me. But I just laughed it off.....”
The allegations
The allegations against the applicant are in the form of Statutory Declarations, sworn by Mr Jonathan L’Strange Harris and Mr Jason James Abbott, on the
19 January 1996. Mr Abbott was called as a witness in these proceedings, but Mr Harris was not called. I can only infer from this that his evidence would not have been of benefit to the respondent’s case.
The declaration of Mr Harris, is that about six months prior to his declaration, he had been injured at work. Before leaving to go home the applicant had offered him a home rolled cigarette and said, “here take this, it might help you with the pain”.
Mr Harris says he took the cigarette believing it to be marijuana and when he smoked it the next day, he confirmed that it was. He also said that this was the first and the last time that the applicant had ever given him a marijuana cigarette.
Mr Jason Abbott, in his Statutory Declaration says, that in early September or October 1995, he had a discussion with the applicant about “choof”. The applicant had said to him that he had some real good stuff and that he would bring him some in.
Mr Abbott declares that about one week later,
“I do not remember the day, at about lunch time, Steve Perkins was sitting at his desk at Botany Branch when he and I had a further conversation. I said, “Did you bring it in for me?”. Steve did not answer. He put his hand inside the bag he carries around his waist and handed me a home rolled cigarette over the desk.
There is nothing in these allegations that infer the applicant actually sold the cigarettes to these men, it appears that they were given freely and both the declarants say that they have never seen the applicant smoke or give cigarettes to any other persons.
On the basis of these allegations the applicant was summarily dismissed for gross misconduct.
The letter of terminations is as follows,
22 January 1996
Mr Stephen Perkins
Dear Sir,
Representations have been made to the management of Grace Removals that you have been engaged in illegal activities whilst working for our Botany depot.
Subsequent investigations have conclusively validated these representations.
As a result of these allegations, the Company finds no alternative but to terminate your employment immediately, for gross misconduct.
Yours faithfully
S.E.PEPPER
SOUTHERN REGIONAL MANAGER.
The investigations
Mr Pepper, gave evidence that on the 23 December 1995, a supervisor Mr Simon Reynolds had approached him in the yard saying he had heard rumours to the effect that the applicant had been distributing marijuana on site. Mr Pepper was then asked by his Counsel what he did then and he replied,
“Well upon resumption of work after Christmas break I took those matters up with my State Manager, Owen Russell, and the person who - who we - the information had come from, we - we interviewed him. At that stage during the interview it was apparent that it was hearsay evidence, there was nothing factual to it and that stage we’d - we basically dropped the investigation .... I decided not to pursue the matter at all.”
When asked who was the man you interviewed, Mr Pepper said it was Mr Peter Kearns, and he further said, that in early January he received information that an employee was prepared to come forward to verify the allegations made by Mr Peter Kearns. This employee, was Mr Jason Abbott who said to him,
“...that he was aware that we had made some enquires as to the effect that Mr Perkins had been giving dope. He came to me and said that he had no problem making a statement to the that effect because Mr Perkins had - had given him marijuana at one point in time whilst at work.”
When asked in cross examination, if Mr Abbott had approached him, Mr Pepper said that he had and agreed that his approach was “just out of the blue”. Mr Pepper said that during his interview with Mr Abbott, Abbott had informed him that another employee, Mr Jon Harris had also received marijuana from the applicant, and Mr Harris was then approached about the subject.
In cross examination the following proposition was put to Mr Pepper,
“That is the extent of the investigation into the matter that you undertook. You spoke to Mr Harris and Mr Abbott and then they filled out the statutory declarations?”
Mr Pepper answered,
“That’s right.”
Mr Pepper also agreed that at no stage did he approach the applicant with the allegations prior to the termination.
When asked why not he answered,
“No, I believe that would more than likely be upsetting.”
Mr Abbott’s evidence
The statutory declarations of Mr Abbott and Mr Harris were marked as (Exhibit R1). Mr Abbot in his evidence in chief said that in late September or early October 1995, he had a conversation with the applicant and it was agreed that the applicant was to bring some marijuana into work for him. He then said that about a week later, he again approached the applicant and asked him if he had brought the marijuana into work. The applicant had said that he had, but had given it to Jon Harris. This evidence contradicts the statutory declaration of Jon Harris. Mr Harris says that he only received marijuana from the applicant on one occasion and that was six months prior to swearing the declaration, which would make it in about July 1995.
He also says in his declaration, that when he asked the applicant, “Did you bring it in for me?, Steve did not answer”.
In his evidence before the Court, he was asked in evidence in chief ,
“Did he say anything to you?”
And he replied,
“He said, Yes”.
Added to the contradictory evidence of Mr Abbott, is the evidence of Mr Pepper, that he was approached out of the blue by Mr Abbott, to give this evidence when it is clear that this was not so. I must say, that I am left with a great deal of suspicion, surrounding the way the Statutory Declarations were obtained. Particularly in light of the fact that they were never shown to the applicant and the fact they were drafted by Mr Smith the respondent’s accountant rather that by the deponents.
The termination
Mr Pepper gave evidence that on the 22 January 1995, at about 5.00pm, he asked the applicant to come into his office. There was only the applicant and Mr Pepper present at the meeting.
Mr Pepper’s evidence was as follows,
“.....from recollection my words were, no doubt you’re aware that there’s been some serious allegations made about you?”, To which he responded, “Yes, I’ve heard rumours”. I then went on to say that, “Well, we’ve received two stat decs to that effect that you’ve been supplying or giving marijuana whilst on site”. From memory his response was, “That’s bullshit.”.....To which I responded, “Well, it’s our view with the two Stat Decs as senior management of the company has investigated this matter and they have no alternative or we’ve no alternative but to terminate your services.”
When asked if the decision to terminate was made prior to that meeting, Mr Pepper agreed that it was, he also said that no matter what was said by the applicant the decision had been made. The termination letter had been prepared and was handed to the applicant. There was no specific allegations made, other that those as set out in the letter. The Statutory Declarations were not provided or any other details concerning the allegations and no explanations were asked for or allowed to be given.
Was there a valid termination?
In Byrne v. Australian Airlines Ltd (1994) 47 FCR 300 at 355 - 356, Gray J was of the opinion that,
“Plainly, it would be harsh, unjust and unreasonable to dismiss an employee for an offence which he or she had not committed. In a proceeding, in which a breach of the clause is claimed, the Court is required to determine whether as a matter of fact, the clause which the employer advanced as the ground for dismissal existed. The Court will determine that issue on the evidence before the that tissue, the Court must inevitably take into account the credit of the various witnesses called. As Gregory illustrates, the Court may even take into account facts which have occurred since the dismissal, in determining what possible developments ought to have been taken into account by the employer.”
Beaumont and Heerey JJ were of the opinion that it was not necessary for the employer to prove that the employee actually stole the goods and at 331 said,
“It is well established that, for present purposes, where a dismissal is based upon alleged misconduct, the employer will breach the Award if it is demonstrated that in so far as it was within the employer’s power before dismissal, the employer conducted as full and extensive an investigation into all of the relevant matters surrounding the alleged misconduct as was reasonable in the circumstances (see Bi-Lo Pty Ltd v. Hooper).
In Bi - Lo Pty Ltd v. Hooper (1994) 53 IR 224, the Full Industrial Commission of South Australia, considered an appeal by the employer against a finding that the dismissal of their Assistant Manager, for allegedly stealing a carton of cigarettes was harsh, unjust and unreasonable. The Trial Judge had found at first instance the employer had failed to prove that the employee had been guilty of the theft. The Full Bench, although saying that it was not necessary for the employer to prove, on the balance of probabilities that the employee actually stole the goods, said at pages 229-230,
“An employee is entitled to both substantive and procedural fairness in respect of a dismissal. Substantive fairness will be satisfied if the grounds upon which dismissal occurs are fair grounds. Broadly speaking a dismissal will be procedurally fair if the manner or process of dismissal and the investigation leading up to the decision to dismiss is just. 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 powers, 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 the 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 the 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........ .......The gravity of the alleged offence will dictate the nature and extent of the inquiry which the employer must conduct. An employer must ensure that the employee is given as detailed particulars of the allegations against him/her as is possible, an opportunity to be heard in respect of such allegations, and a chance to bring forward any witnesses he/she may wish to answer those allegations.”
In the present case, it has been alleged that the applicant is guilty of a serious criminal offence, of supplying a prohibited drug to fellow employees. In fact the termination letter says that representations had been made to the respondent that the applicant had engaged in illegal activities and that subsequent investigations have conclusively validated these representations.
It has been admitted by Mr Pepper, that the extent of these investigations, were that he had interviewed Mr Peter Kearns, the person who he said told of the rumours, and the two people that had signed the Statutory Declarations. There was no evidence that any other people were interviewed.
Of course, in light of the applicant’s position in the allocation of work and his evidence that disgruntled drivers had tried to get him before, the procedure of interviewing other employees may have scotched any conspiracy theory against him. Even more baffling is the failure of the respondent to bring these allegations to the attention of the applicant as part of their investigation which they say “conclusively validated these representations”. At no stage was the applicant ever told of, or shown the Statutory Declarations, which were the basis of his termination, prior to or even at the termination meeting. Nor was any explanation asked for, or expected from him by the respondent, at the termination meeting as the decision to terminate had already been made and the letter of termination prepared prior to the meeting.
All this suggests to me is that there was a very unsatisfactory and superficial inquiry carried out regarding these very serious allegations. To blindly accept the truth of the two removalists without consultation with the applicant, a senior member of the staff with eight years service is to make a very unsafe finding indeed.
In applying the test as set out in Bi - Lo Pty Ltd v. Hooper, the respondent in this case, has clearly failed on all counts. The termination of the applicant’s employment is therefore harsh, unjust and unreasonable. How the respondent could honestly and genuinely believe, that the applicant was guilty of the alleged offence without even attempting to bring the allegations to his notice is beyond comprehension. For Mr Pepper to offer by way of explanation for his failure to do so was because, he, “believed that would more than likely be upsetting”, is astounding.
In applying the test of Gray J, as set out in Byrne v. Australian Airlines, it is also necessary for the respondent in the carriage of the burden of proof pursuant to
s. 170EDA (1) (a) to satisfy this Court, not on the balance of probability, but on a higher standard of proof, because of the gravity of the allegations (Briginshaw v. Briginshaw (1938) 60 CLR 336.).
Having considered the evidence, I am satisfied that the respondent has failed to prove that there was a valid reason for the termination of the applicant’s employment and therefore the termination was in contravention of s. 170DE(1).
I make the following orders,
That the respondent reappoint the applicant to the position in which he was employed immediately before the termination or to another position on terms and conditions no less favourable that than those on which he was employed immediately before the termination.
That the respondent pay to the applicant the remuneration lost by the applicant because of the termination.
I certify that this and the preceeding Eleven (11) pages are a true copy of the reasons for judgment of Judicial Registrar Walker.
Legal Assistant: Claire McAuley
Date: 30th July 1996
Appearances:
Counsel for the applicant: Mr P.J. Newell
Representative for the respondent: G. Maniatis
INDUSTRIAL RELATIONS COURT
OF AUSTRALIA
SYDNEY REGISTRY
No. NI 1208of 1996
BETWEEN:
STEPHEN JAMES PERKINS
Applicant
AND:
GRACE WORLDWIDE (AUST) PTY LTD
Respondent
BEFORE: WALKER JR
PLACE: SYDNEY
DATE: 30th JULY 1999.
MINUTES OF ORDER
THE COURT ORDERS THAT:
That the respondent reappoint the applicant to the position in which he was employed immediately before the termination or to another position on terms and conditions no less favourable that than those on which he was employed immediately before the termination.
That the respondent pay to the applicant the remuneration lost by the applicant because of the termination.
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