Queensland Nurses’ Union of Employees v Australian Red Cross Society and Ors (No.2)
[2016] FCCA 3132
•16 November 2016
FEDERAL CIRCUIT COURT OF AUSTRALIA
| QUEENSLAND NURSES’ UNION OF EMPLOYEES v AUSTRALIAN RED CROSS SOCIETY & ORS (No.2) | [2016] FCCA 3132 |
| Catchwords: INDUSTRIAL LAW – Awards – breach of award– contravention of FW Act –pecuniary penalty –penalty to be paid to the Commonwealth – compensation paid to the Applicant. |
| Legislation: Fair Work Act 2009 (Cth) |
| Cases cited: Mason v Harrington Corporation Pty Ltd [2007] FMCA 7 |
| Applicant: | QUEENSLAND NURSES’ UNION OF EMPLOYEES |
| First Respondent: | AUSTALIAN RED CROSS SOCIETY |
| Second Respondent: | RHIANNON FEALY |
| Third Respondent: | LISA MCILROY |
| File Number: | BRG 938 of 2014 |
| Judgment of: | Judge Vasta |
| Hearing date: | 16 November 2016 |
| Date of Last Submission: | 16 November 2016 |
| Delivered at: | Brisbane |
| Delivered on: | 16 November 2016 |
REPRESENTATION
| Counsel for the Applicant: | Mr Reed |
| Solicitors for the Applicant: | QUEENSLAND NURSES' UNION OF EMPLOYEES |
| Counsel for the Respondents: | Mr Rinaldi |
| Solicitors for the Respondents: | LANDER & ROGERS LAWYERS |
ORDERS
That the First Respondent pay to the Ms Baillie the sum of $5,000.00 by way of compensation.
That the First Respondent pay by way of pecuniary penalty the sum of $20,000.00 to be paid to the Consolidated Revenue Fund of the Commonwealth within thirty days of the date of the Order.
| FEDERAL CIRCUIT COURT OF AUSTRALIA AT BRISBANE |
BRG 938 of 2014
| QUEENSLAND NURSES’ UNION OF EMPLOYEES |
Applicant
And
| AUSTRALIAN RED CROSS SOCIETY |
First Respondent
| RHIANNON FEALY |
Second Respondent
| LISA MCILROY |
Third Respondent
REASONS FOR JUDGMENT
(Ex tempore)
On 11 October 2016, I declared that the First Respondent, by making an accusation of unsatisfactory performance against Ms Baillie specifically that
a)Ms Bailey refused to accept the feedback from the PIP,
b)That there was no indication of a willingness to improve on the part of Ms Bailey, and
c)That Ms Bailey did not accept the integrity of the process
contravened s.340(1)(a)(i) of the Fair Work Act 2009 (Cth) (“the FW Act”).
I adjourned the matter to today for a penalty hearing.
Part of the application made by the Queensland Nurses’ Union, who appeared as the Applicant, was that Ms Baillie ought to be compensated for the loss she had suffered because of the First Respondent’s contravention. The Applicant submitted that the Court should award compensation to Ms Baillie for the distress and humiliation which she suffered as a result of the conduct that constituted the contravention of the FW Act.
The submission was that, prior to the contravening conduct, Ms Baillie was in an emotionally vulnerable state as a result of the ongoing PIP process and earlier allegations of inappropriate conduct. She was distressed, intimidated and humiliated by the contravening conduct and the effects were significant.
It was pointed out that not only the Applicant but also the Second and Third Respondents described Ms Baillie as being shocked and upset when she received the show cause letter and:
a)That she said immediately “I am humiliated”;
b)That she was sent home from work because of her distress;
c)That she took significant sick leave following receipt of the show cause letter and the disciplinary meeting that occurred on 5 May 2014;
d)That she could not attend the outcome meeting on 29 May as she was ill from stress;
e)That she was very shocked and upset by the contents of the second and final warning letter;
f)That her ongoing distress at the false allegations against her caused her to tender her resignation, which is what it was that she said in her resignation letter; and
g)That she continued to feel distressed, depressed, angry and other negative emotions following her separation from employment with the First Respondent.
That is the evidence of the “injury” at its highest. What must now follow is an examination of how much this particular aspect of the conduct of the First Respondent contributed to this particular state.
The evidence displayed to me that Ms Baillie was a very strong person whose confidence and strength was certainly starting to dissipate during the time period after her first assessment and through the PIP process. The handing to her of the show cause letter was, in many ways, a straw that broke the camel’s back.
However, when one has a look at all circumstances and has a look at what it was that the First Respondent actually did to cause the “injury”, the situation is a little different to what one would normally see in these cases. If it were that the First Respondent was responsible for the state in which the Applicant was in, or that it could be said with certainty that it was the behaviour, or the contravention, of the First Respondent that caused this particular hurt, humiliation and distress in Ms Baillie, then much of what was said by the Applicant would be apposite.
However, this aspect is just one part. Whilst it is not an insignificant part, it is just one part. It is not a case, as was put, that whilst one has to take a victim as one finds it, that what had happened beforehand can actually be totally ignored.
The fact is that, on my findings, whilst there was significant hurt, distress and humiliation because of what the First Respondent had been doing, such was not adverse action or a contravention of the FW Act. The initial rating of her as a UC, which was then changed to a UB, the PIP process itself, the first warning letter and what occurred from that were all matters that did lead to the hurt, humiliation and distress that the Applicant had, but none of those were caused by any contravention by the First Respondent.
What occurred instead is that the First Respondent wanted Ms Baillie, to use the vernacular, “get with the program”. This was starting to occur, and Ms Baillie finally understood what the First Respondent wanted her to do. But three days after an extremely positive meeting which showed that the aims of the PIP process were actually becoming effective, there was, for an inexplicable reason, a letter given to her asking her to show cause.
Such a letter flew in the face of what the PIP process was all about, considering that the PIP was not to finish for another month, or four weeks, before the date of that letter.
Therefore, one has to look at what part of the humiliation, hurt and distress came from that letter. To my mind, one has to look at a ballpark figure for what her distress would be and then look at what part of it came from that particular letter.
In the end, I am of the view that Ms Baillie ought be awarded a sum of money by way of compensation for hurt and distress and humiliation. However, because of the matters that I have already spoken of, it should be an award that is tempered somewhat.
For the matters of pecuniary penalty, it is acknowledged by both sides that the maximum penalty payable by the First Respondent is $51,000.00 because that is using the penalty unit at $170.00.
Where does this particular matter fit? Looking at all the matters that I have spoken of in my judgment, I should then apply those facts to what has been colloquially known as the “Pangaea” list made by Mowbray J in Mason v Harrington Corporation Pty Ltd [2007] FMCA 7 where His Honour listed quite a number of criteria that a Court should consider. Of course, I am also cognisant of what the Full Court has said; that checklists of the kind can be useful, provided they do not become transformed into a rigid catalogue of matters for attention.
What to me is significant here is that these breaches, as far as the First Respondent was concerned, were not deliberate. The First Respondent had a process in place and expected its employees to administer that protocol in a proper way. The Second and Third Respondents did not do that. It was one contravention and one contravention only. There was no senior management involved in the breach at all.
However, it was a very abhorrent act by the two middle managers and really quite contrary to their obligations both to the First Respondent and to Ms Baillie herself. Their actions have caused the First Respondent to be liable. I do note that the Applicant could have pleaded that the Second and Third Respondents ought be personally liable as well for pecuniary penalties but declined to do so.
That does not mean that the conduct of the First Respondent is any the less deserving of sanction from the Court.
I have taken into account the nature and extent of the conduct that led to this particular contravention. In my Reasons for Judgement, I have described the circumstances in which they conduct took place. In describing the impact that the contravention has had on Ms Baillie earlier, I have looked at the nature and extent of the loss or damage that she sustained as a result of the contravention.
There has been no similar previous conduct by the First Respondent and this was one contravention. The First Respondent is a charitable organisation and I do take that into account. As I have already said, these contraventions were not deliberate by the First Respondent and senior management was not involved.
However, there has been no contrition shown. In my Reasons for Judgement, I spoke of the almost contemptuous way in which the 2nd and 3rd respondents approached their duty to Ms Baillie. Such actions cannot be tolerated in the Australian workplace and a very strong message of deterrence needs to be made by the Courts.
As a result of the matters that I have spoken, this is a matter where I would see the maximum penalty that I ought impose as being far less than the actual maximum penalty. The penalty that I feel ought be imposed is one of $20,000.00. There are no other matters upon which I feel have been significant enough for me to mitigate that penalty. Therefore, that will be the sum of the pecuniary penalty.
The Applicant has submitted that I should make the “usual order” that the pecuniary penalty be paid to the Applicant. The Applicant spoke of the “usual order” as that term was used in Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd (No 5) [2013] FCA 1384. At paragraph 24, the Court noted that the pecuniary penalty paid to the Applicant union, in that case, recognised the trouble, risk and expense of bringing proceedings which are in the public interest, which advance the objects of the legislation and which benefit the wider community.
That may be so, but in this case the Applicant union did not plead what it was that the Court ended up finding. The Applicant union was extremely vague in what it put before the Court and left this Court in an unenviable position of having trying to discern what it was that the union was actually submitting. The conduct that I found to have been the cause of the breach, again, as I say, was not anything that was specifically pleaded.
In some ways, it would be grossly unfair to enrich the union simply because they are the Applicant. The Applicant achieved their aims in bringing this litigation because they were able to shine a spotlight upon behaviour that was not in keeping with the standards expected in the Australian workplace. That should be reward enough.
It is also my view that the FW Act is an Act that really weaves the fabric of industrial relations within this country. As such, any action that amounts to a contravention is an action that seeks, whether on purpose or inadvertently, to tear at that fabric in such a way all of society suffers.
In that respect, it is the whole of society who have suffered. The reparation for that suffering of society should then be made to the community. Therefore, it is my view that in a case such as this, the pecuniary penalty is one that ought be paid to the Commonwealth.
I certify that the preceding twenty-seven (27) paragraphs are a true copy of the reasons for judgment of Judge Vasta
Date: 8 December 2016
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