Ramos v Good Samaritan Industries
[2013] FCA 30
•30 January 2013
FEDERAL COURT OF AUSTRALIA
Ramos v Good Samaritan Industries [2013] FCA 30
Citation: Ramos v Good Samaritan Industries [2013] FCA 30 Appeal from: Ramos v Good Samaritan Industries (No 2) [2011] FMCA 341 Parties: AGUSTIN RAMOS v GOOD SAMARITAN INDUSTRIES File number: WAD 377 of 2011 Judge: BARKER J Date of judgment: 30 January 2013 Catchwords: INDUSTRIAL LAW – appeal from Federal Magistrates Court following dismissal of application alleging contravention of s 340(1) of the Fair Work Act 2009 (Cth) – nature of appeal by way of rehearing – approach to determining whether adverse action is taken “because” of a proscribed reason – whether adverse action allegedly suffered by appellant was “because” of a workplace right Legislation: Fair Work Act 2009 (Cth) s 340(1); s 340(1)(a); s 340(1)(a)(i); s 340(1)(b); s 340(2); s 341; s 341(1)(b); s 341(1)(c)(ii); s 342(1); s 342(2); s 346; s 347; s 361; s 386(1)(b)
Federal Court of Australia Act 1976 (Cth) s 24(1)(d); s 25(1AA); s 27; s 28Cases cited: Australian Licensed Aircraft Engineers Association v International Aviation Service Assistance Pty Ltd [2011] FCA 333; (2011) 193 FCR 526
Barclay v Board of Bendigo Regional Institute of Technical and Further Education [2011] FCAFC 14; (2011) 191 FCR 212
Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012] HCA 32; (2012) 86 ALJR 1044
Builders’ Licensing Board v Sperway Constructions (Syd) Pty Ltd (1976) 135 CLR 616
Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission [2000] HCA 47; (2000) 203 CLR 194
Fox v Percy [2003] HCA 22; (2003) 214 CLR 118
General Motors‑Holden’s Pty Ltd v Bowling (1976) 51 ALJR 235
Ramos v Good Samaritan Industries (No 2) [2011] FMCA 341
Whitaker v Child Support Registrar [2010] FCAFC 112Date of hearing: 12 October 2012 Place: Perth Division: FAIR WORK DIVISION Category: Catchwords Number of paragraphs: 143 Counsel for the Applicant: Mr TJ Hammond (Pro Bono) Counsel for the Respondent: Mr S Kemp Solicitor for the Respondent: Jackson McDonald
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
FAIR WORK DIVISION
WAD 377 of 2011
ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA
BETWEEN: AGUSTIN RAMOS
AppellantAND: GOOD SAMARITAN INDUSTRIES
Respondent
JUDGE:
BARKER J
DATE OF ORDER:
30 JANUARY 2013
WHERE MADE:
PERTH
THE COURT ORDERS THAT:
1.The appeal be dismissed.
Note:Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.
IN THE FEDERAL COURT OF AUSTRALIA
WESTERN AUSTRALIA DISTRICT REGISTRY
FAIR WORK DIVISION
WAD 377 of 2011
ON APPEAL FROM THE FEDERAL MAGISTRATES COURT OF AUSTRALIA
BETWEEN: AGUSTIN RAMOS
AppellantAND: GOOD SAMARITAN INDUSTRIES
Respondent
JUDGE:
BARKER J
DATE:
30 JANUARY 2013
PLACE:
PERTH
APPEAL AGAINST FAIR WORK DECISION
On 22 July 2010, the appellant gave the respondent four weeks notice in writing of his intention to resign from his employment as the store manager of the Good Samaritan Industries store at Dianella, Western Australia.
On 23 July 2010, the respondent accepted the appellant’s resignation and paid him four weeks pay in lieu of notice together with accrued entitlements. At that point the appellant’s employment with the respondent, which had commenced on 22 June 2009, came to an end.
On 29 September 2010, however, the appellant filed an application in the Fair Work Division of the Federal Magistrates Court seeking relief pursuant to the Fair Work Act 2009 (Cth) (FW Act) alleging “adverse action” against him contrary to s 340(1), including his constructive dismissal from his employment. The appellant sought compensation and pecuniary penalties.
The Federal Magistrates Court dismissed the proceeding finding that the respondent did not contravene the FW Act: see Ramos v Good Samaritan Industries (No 2) [2011] FMCA 341.
DECISION OF THE FEDERAL MAGISTRATES COURT
In the Federal Magistrates Court, in summary, the appellant claimed that:
·at material times he exercised a workplace right by making a complaint to his employer, pursuant to s 341 of the FW Act;
·subsequent to his complaint, he had been the subject of adverse action and discrimination in the workplace, contrary to s 342(1) and s 352 of the FW Act; and
·the adverse action and discrimination suffered by him caused him to resign.
His points of claim in the Federal Magistrates Court relevantly claimed :
4.On 6 April 2010, the Applicant submitted a complaint addressed to the Human Resources Manager of the Respondent. The complaint was against the Respondent’s Divisional Operations Manager and the Retail Operations Manager to whom the Applicant reported to.
5.The Applicant claims that all adverse action taken by the Respondent against the Applicant referred to in subsequent paragraphs was taken because the Applicant submitted the complaint referred to in paragraph 4.
6.The Applicant claims that in a letter from the Respondent dated 23 April 2010 the Respondent took adverse action against the Applicant, in breach of section 342 subsection (1), subsection (2) and section 340 of the Act.
Particulars
a)The Respondent threatened the Applicant with disciplinary action without any or any sufficient reason.
b)The Respondent discriminated against the Applicant by choosing to side with the other employees Gordon and Cameron instead of the Applicant without any or any sufficient evidence or reason.
7.The Applicant claims that in a letter from the Respondent dated 3 May 2010 the Respondent took adverse action against the Applicant, in breach of section 342 subsection (1), subsection (2) and section 340 of the Act.
Particulars
a)The Respondent decided to demote the Applicant from a level 1 store to a level 3 store and transfer the Applicant to the Armadale Store (a store which the Respondent intended to close) which was extremely inconvenient to the Applicant and would ultimately have lead to the Respondent being made redundant.
8.The Applicant claims that in a letter from the Respondent dated 12 May 2010, the Respondent took adverse action against the Applicant, in breach of section 342 subsection (1), subsection (2) and section 340 of the Act.
Particulars
a)The Respondent threatened the Applicant with dismissal without any or any sufficient reason.
b)The Respondent required the Applicant to sign a Performance Management Framework contract in order for the Applicant to retain his position of employment as the Dianella Store Manager.
9.The Applicant claims that in the same letter from the Respondent dated 12 May 2010 the Respondent took adverse action against the Applicant, in breach of section 342 subsection (1), subsection (2) and section 340 of the Act.
Particulars
a)The Respondent threatened the Applicant again with disciplinary action in respect of vehicle allowance claims, a banking shortfall and sick leave taken on 1 May 2010, without any or any sufficient reason.
10.The Applicant claims that on the 20 May 2010 the Respondent took adverse action against the Applicant, in breach of section 342 subsection (1), subsection (2) and section 340 of the Act.
Particulars
a)Joy Wilson Retail Operations Manager for the Respondent threatened the Applicant by waiving the Performance Management Framework contract in his face in an act of intimidation and insinuated what would happen if the Applicant did not adhere to the requirements expected of him and stated in the PMF contract which the Applicant signed.
11.The Applicant claims that on the 3 June 2010, the Respondent took adverse action against the Applicant in breach of section 342 subsection (1), subsection (2) and section 340 of the Act.
Particulars
a)The Respondent suspended the Applicant from his employment as Dianella Store Manager without any or any sufficient reason.
b)The Respondent discriminated between the Applicant and other employees of the Respondent by accepting a complaint made against the Applicant by those other employees without any or any sufficient evidence or reason and/or without affording the Applicant natural justice in relation to the complaint.
12.The Applicant claims that in the letter from the Respondent dated 16 June 2010, the Respondent threatened the Applicant with a final warning and a threat of disciplinary action and another threat of dismissal, in each case without any or any sufficient reason. In doing so the Respondent took adverse action against the Applicant, in breach of section 342 subsection (1), subsection (2) and section 340 of the Act.
13.The Applicant claims that in the letter from the Respondent dated 23 June 2010 the Respondent threatened the Applicant by canceling his employment income payment. In doing so the Respondent took adverse action against the Applicant, in breach of section 342 subsection (1), subsection (2), section 340 and section 352ment [sic] of the Act.
14.The Applicant claims that in the email from the Respondent dated 9 July 2010 the Respondent threatened the Applicant by denying the Applicant the payment of the Applicant's annual leave entitlements. In doing so the Respondent took adverse action against the Applicant, in breach of section 342 subsection (1), subsection (2), section 340 and section 352 of the Act.
15.The Applicant claims that the actions referred to in paragraphs 6 to 14 above further or alternatively constituted a constructive dismissal of the Applicant, by making his position untenable thereby forcing or giving him strong inducement to resign his employment, which he did on 22 July 2010. This constructive dismissal is itself adverse action contrary to the Act.
The hearing of the claim proceeded before the Federal Magistrate in May 2011. The appellant was self represented throughout the proceeding. On 24 August 2011, the Federal Magistrate delivered judgment. In essence, the Federal Magistrate found the appellant had a “workplace right” as defined by s 341(1)(c)(ii) of the FW Act, as he was a person “able to make a complaint or inquiry” in relation to his employment. His Honour held that the appellant was “concerned about statements made to him by Ms Cameron and Mr Gordon in the course of his employment” and was satisfied he was able to make a complaint or inquiry about those statements.
However, the Federal Magistrate did not find that the appellant was constructively dismissed in accordance with s 386(1)(b) of the FW Act, which states that “the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer”. His Honour, at [52], found that at the time of the appellant’s resignation on 22 July 2010 the respondent had not acted in a manner that could be described as leaving the appellant with no option but to resign, as the respondent had “legitimate concerns” about the performance of the Dianella store, the performance of the appellant as store manager and his conduct as an employee in relation to other employees and the policies of the respondent.
The Federal Magistrate, at [71] to [102], found that the respondent did not engage in “adverse action” against the appellant, and in relation to the action taken against the appellant held, in summary, that:
·The respondent’s letter dated 23 April 2010 and the threat of disciplinary action did not constitute adverse action, as the only warning issued related to an “expressed insistence on following established policies and procedures in relation to overtime and leave”, and the statement about possible future disciplinary action was not a threat in terms necessary to constitute adverse action.
·The investigation of the appellant’s complaint did not constitute discrimination.
·The transfer to the Armadale store discussed in the letter dated 3 May 2010, and alleged by the appellant to be a “demotion”, never occurred, “so no adverse action as defined occurred”.
·In relation to the letter dated 12 May 2010, there was no threat of dismissal, and the appellant “was informed that disciplinary action would be taken if he breached GSI policy in future” which did not constitute adverse action, and was reasonable given the travel claims made by the appellant on days he was off work which were acknowledged by the appellant.
·The request to sign the performance management framework did not constitute adverse action, and it was accepted that there were ongoing problems with the appellant’s performance and Mr Knowles wanted to ensure that the appellant was made aware of his responsibilities.
·The letter dated 19 May 2010 explained the respondent’s time off in lieu (TOIL) policy and advice of the application of it to the appellant, and the application of the policy could only be adverse action if it was applied in a discriminatory fashion, which it was not.
·It was accepted that Ms Wilson’s reference to the performance management framework during her visit to the store on 20 May 2010 had “nothing to do with the complaint”.
·In regards to the 3 June 2010 suspension, it was accepted that suspension on pay pending an investigation of allegations made may constitute adverse action because benefits of working are not limited to being paid. However, no decision on the validity of the complaints was made at the time of the suspension and the complaints were referred for investigation. The reason for the suspension was unacceptable behaviour in the workplace.
·The letter dated 16 June 2010 did not constitute “threats” and there was no adverse action. A warning of disciplinary action, including possible dismissal, as part of a disciplinary process “foreshadows a possible future detriment as a consequence of possible future conduct but is not an act of retaliation and is not, and is not intended to be, menacing”. Mr Knowles’ evidence was accepted that the warning was issued because the appellant used profane language and shouted at staff.
·The failure to pay out leave as outlined in the letter dated 9 July 2010 was not adverse action because the reason for the refusal was that the respondent understood that such a payment was not permitted at law.
In all instances, the Federal Magistrate accepted the respondent’s evidence that the relevant action taken was not because of the complaint on 6 April 2010. His Honour found that the appellant had failed to demonstrate any unlawful adverse action against him and dismissed the appellant’s application.
ISSUES ON THE APPEAL
On 22 December 2011, the appellant filed an amended notice of appeal against the decision of the Federal Magistrates Court with 42 grounds of appeal, all said to be based on errors of the Federal Magistrate. The appellant argues the decision of the Federal Magistrate was materially affected by errors of fact and law. In summary, it is submitted that the Federal Magistrate erred by:
(1)Failing to apply the proper legal test as it related to a finding of constructive dismissal.
(2)Failing to make proper findings in relation to the workplace incidents said to amount to adverse action and/or discriminatory behaviour.
(3)Failing to provide adequate reasons explaining his decision and exposing the reasoning process behind his findings.
(4)Making credibility findings that were in the circumstances of this case contrary to compelling inferences.
It its submissions the respondent says the primary issues to be determined on the appeal are:
(1)Did the Federal Magistrate err in holding the respondent did not take the alleged adverse action because the appellant had made a complaint in relation to his or her [sic] employment?
(2)Did the Federal Magistrate err in holding that the appellant was not constructively dismissed?
(3)Did the Federal Magistrate err in holding that the appellant was not subject to adverse action?
(4)Did the Federal Magistrate err in holding that the appellant’s evidence of his attempts to gain alternative employment was unconvincing?
The respondent says that if the Federal Magistrate’s decision in relation to a (1) is upheld, the remaining issues become academic.
EVENTS LEADING TO THE SUSPENSION
The respondent at all material times traded as Good Samaritan Industries, an agency of the Uniting Church in Australia, offering for sale recycled clothing and other goods to consumers, including at stores at Dianella and Armadale, Western Australia.
On 22 June 2009, the appellant commenced full time employment with the respondent as the Dianella store manager. The position was covered by the Good Samaritan Industries Union Collective Workplace Agreement 2007 (Agreement) and an employment contract which the appellant signed. The “duty statement” described the appellant’s role as:
[t]o manage a [Good Samaritan Industries] retail outlet which exemplifies excellence in customer service, product merchandising, reach sales budgets and manage cost structures set for the Shop and … To be committed to developing a cohesive and effective team of staff – by the provision of training and staff development opportunities for the all staff and … To provide employment and training opportunities for people with disabilities.
The appellant’s “specific duties” were to:
·Manage the shop in a way which is consistent with the vision and mission of the respondent.
·Manage and coordinate the merchandising and presentation of the shop.
·Control and implement security procedures, manage inventory and control stock.
·Manage financial control systems within budget allocations.
·Assist in the development and implementation of strategic plans for the shop.
·Identify opportunities for increased sales and improve customer service, to evaluate, negotiate and implement changes consistent with the respondent’s retail shop’s overall aims and objectives.
·Ensure occupational safety and health (OSH) procedures are implemented and maintained by all staff in line with the respondent’s OSH policy.
·Monitor and motivate staff members and create an environment in which members work as a team and are motivated to achieve retail aims.
·Work in consultation with the human resources and training section to be able to assist in determining staff needs, selection, recruitment and effective deployment of staff within the workplace.
·Ensure the respondent’s human resources policies and procedures are implemented and maintained in the workplace.
·Provide leadership and support to staff members to develop a highly effective team, consistent with the objectives of the respondent.
·Deliver and evaluate training in practical workplace related skills on a one to one or small group basis.
·Work in conjunction with the training coordinator and the retail accredited training program to develop and implement training in accordance with training plans.
·Undergo training as identified in the staff and organisational development plan.
·Undertake tasks as issued by the manager.
At materials times, since April 2001, Mr Michael Gordon was employed by the respondent as the retail operations manager for the north of Perth area. His position required the overseeing of the running of all the respondent’s stores in that area, which included the Dianella store, and ensuring the stores were well-stocked, organised and running properly. As part of his duties, Mr Gordon visited the Dianella store on a regular basis while the appellant was employed as the store manager from the commencement of his employment until 14 April 2010.
Ms Joy Wilson was employed by the respondent in a number of roles, including as the retail operations manager for the south of Perth area at material times from 4 January 2010. Ms Wilson was responsible for visiting the Dianella store while the appellant was store manager from on or about 18 May 2010.
Ms Debbie Cameron was employed by the respondent in various roles from 1999, including as the divisional manager of commercial operations for eight years which involved updating store managers, including the appellant at material times, on the financial results of their stores.
Mr John Knowles was employed by the respondent from June 2008 as the chief executive officer, and at material times he communicated on behalf of the respondent with the appellant on a number of occasions.
On 30 March 2010, a store managers’ meeting was held at the respondent’s head office at 47 Magnet Road, Canning Vale. During a “role play” by the store managers, Ms Cameron interjected when the appellant called someone “darl”. This occurred during a segment scheduled from 1pm to 4pm which was titled “Professional development: Conflict resolution training to be conducted by facilitators from ‘Solutions for Conflict’”.
The next day, on 31 March 2010, a meeting was held between Mr Gordon and the appellant to discuss why the Dianella store sales figures were below budget. It was the appellant’s position, as stated in his affidavit filed 15 November 2010, that reduced sales were due to “reduced floor space allocated to sundries” and the appellant also contended that he should not have to do unpaid overtime (contrary to Mr Gordon’s expressed expectation).
Nearly a week later, on 6 April 2010, the appellant complained by letter addressed to the manager of human resources that he felt mistreated by both Ms Cameron and Mr Gordon in an “unjust and unsatisfactory manner” during the meetings on 30 and 31 March 2010, that they had shown him a “total lack of respect”, and that he was highly offended. In summary, the letter stated that:
·Mr Gordon felt the appellant treated him (Mr Gordon) with disrespect during the managers’ meeting on 30 March 2010 when Mr Gordon mentioned the topic of extended trading hours to which the appellant replied, “Will you [Mr Gordon] be working extended hours?” The appellant noted that he did apologise and told Mr Gordon that his intention was not to be disrespectful and that he was simply asking a question.
·Ms Cameron used a “condescending tone” when she responded to a question which the appellant found “demeaning and disrespectful”, namely:
Question: “Can we close the stores for Easter Saturday.?[sic]” Response: “You can ask the question but you’ll still be working Easter Saturday.”
·It was not the appellant’s intention to offend anyone by referring to some of the ladies in the room as “darl” and he was “totally humiliated by Debbie Cameron during a training scene” that took place in front of the other managers and the guest trainers. Ms Cameron had “suddenly interrupted the whole exercise … in a very angry and extremely degrading manner [and] spoke very rudely” to him saying “if you called me darl, I would find that highly offensive”, to which he replied that the way she had just spoken to him was “not just humiliating but also extremely offensive” to him.
·Mr Gordon attacked the appellant’s integrity and professionalism as the store manager on 31 March 2010 because he blamed the appellant and questioned decisions he had made as being the reason for the loss of store revenue for the financial year 2009/2010.
·Mr Gordon also mentioned that the appellant always seemed to have a reason when questioned in regards to store matters and that Mr Gordon did not accept them and referred to them as excuses and that Mr Gordon found it “frustrating” when the appellant disagreed and argued his point of view.
·The store relay implemented in August 2009 affected store sales so for Mr Gordon to “100%” blame the appellant for the total loss in revenue “[was] not only unjust but very offensive, because it insult[ed] [the appellant’s] intelligence, integrity, character and professionalism as a Store Manager with 27 years of experience in business and management”.
·Mr Gordon questioned the appellant’s integrity when he allowed his assistant manager to take Thursdays off to care for a disabled child. The appellant was also questioned when starting late one morning, with Mr Gordon telling him that that was “not acceptable” as the appellant was expected to open and close the store every day because he was the store manager.
·Mr Gordon insisted the appellant should be working overtime without compensation as this was the accepted “norm” in the retail industry. When the appellant told Mr Gordon that he already worked many hours overtime he was not convinced and referred to this as the reason for the loss of revenue in the store.
·The appellant had worked 123.28 hours overtime from 1 July 2009 to 1 April 2010, equating to 16.43 days, which amounted to $2,759 in unpaid overtime which was owed to him.
On 16 April 2010, a meeting was held at the Dianella store between the appellant and Mr Knowles to discuss the issues raised in the appellant’s letter dated 6 April 2010. Mr Knowles told the appellant that he should not contact Mr Gordon or Ms Cameron until the issues raised in his letter were finalised.
On 16 April 2010, following the meeting with Mr Knowles, the appellant sent a facsimile to Mr Knowles entitled “outcome report”, which dealt with issues including mutual respect, proper conduct procedures, accusations and instructions, and overtime worked.
On 17 April 2010, the appellant caused a facsimile to be sent to Mr Gordon, stating that he would be taking leave, and “will be back Wednesday. Monique is incharge [sic] in my absence.” Mr Knowles, by affidavit in the Federal Magistrates Court filed 25 November 2010, stated that the appellant was entitled to Monday 19 April 2010 off in lieu of working on Saturday 17 April 2010, however the appellant did not provide any explanation as to why he took unapproved leave on Tuesday 20 April 2010, contrary to the respondent’s standard procedure and the Agreement.
On 23 April 2010, Mr Knowles wrote to the appellant and stated that:
·At the meeting on 30 March 2010, “No one displayed any lack of respect” or “any other unprofessional behaviour”, and as such, no further action was required.
·In relation to the way Ms Cameron spoke to the appellant during the training session, that terms of endearment or pet names like “darl” can cause offence and the use of such terms at work is “totally unacceptable”, however Ms Cameron expressed regret that she dealt with the situation in an open forum in front of others, and had agreed that in the future such matters will be resolved privately and in a professional manner.
·In relation to the appellant’s performance as store manager, any questions about store performance from the operations manager “do not in itself constitute an ‘attack on integrity and professionalism’”, and such questioning was seen as “part of the role” of the operations manager. There was no evidence that could be construed as an attack on the appellant’s integrity and professionalism.
·Changes were made to bring the Dianella store’s layout and retail offer in line with other outlets, as they had been demonstrating strong sales over previous years, and this change “is only one factor, amongst many,” that could affect store sales, for example, prevailing economic conditions, local demographics and competition, and these issues are taken into account when developing strategies.
·There was no evidence that the operations manager blamed the appellant for the “100% total loss of revenue in the store”, and at budget review meetings conducted monthly the operations manager had “always shown support for the store” and the appellant as store manager. The operations manager’s “major issue” for the store was maximising stock available for sale and that, while the appellant raised staff shortage as an issue, many of the stores faced this issue and were able to meet and exceed sales targets.
·The appellant was not meeting the requirements to ensure stock levels were optimised to maximise sales targets.
·The appellant is accountable in his role which is defined in his duty statement.
·It was clear that the appellant had not “fully implemented the retail strategy and directions set by the Operations Manager” for his store.
·The operations manager questioned the appellant’s decision making regarding the solution for increasing store revenue but there was “no evidence” he questioned his integrity.
·In respect to the claim for overtime worked, there was no evidence that the time off in lieu policy, PP:HR:07, had been followed, in that the additional hours had not been authorised by the operations manager at the appellant’s request prior to those hours being worked, and he (Mr Knowles) did not see why the organisation had a responsibility to retrospectively compensate the appellant “when [the respondent’s] policy on this is clear”.
·In relation to overtime, he (Mr Knowles) agreed with the operations manager in that “sometimes it is necessary to step up and put in the extra effort”.
·In relation to the taking of unauthorised leave, the appellant needs to seek approval from the operations manager for time off, and if there were further breach of procedures in this regard in the future, then the appellant may face disciplinary action.
On 28 April 2010, the appellant responded by letter to Mr Knowles stating that he accepted Mr Knowles’ decision in relation to the managers’ meeting of 30 March 2010 and the training session, but “strongly” disagreed with his version of the events relating to his performance as a store manager and the solution for increasing store revenue.
On 29 April 2010, a meeting was held lasting approximately 60 minutes between Mr Knowles and the appellant. Mr Knowles stated in his affidavit that his “major concern” was that the appellant had not sought approval for the leave taken on 20 April 2010. On Mr Knowles’ recollection, the appellant said that he thought he had previously worked enough hours, and that the facsimile he sent informing Mr Gordon was sufficient.
By letter to the appellant dated 3 May 2010 Mr Knowles summarised the outcome of the meeting of 29 April 2010 and stated that:
·The appellant still held the view that his “integrity and professionalism” had been attacked and was blamed for the store’s performance.
·The appellant held the view that the “changes to the store layout have affected sales” which he should not be held accountable for, and comparisons of the current financial performance with the past “cannot be used to judge financial performance of the store” and his own performance.
·When Mr Knowles raised the comparison of financial performance of the store against its current budget as another means of assessment, the appellant was “dismissive of the budget and indicated that it was unrealistic”.
·It was agreed by the appellant that to optimise sales the appellant had a “responsibility to implement decisions taken in the manner the Operations Manager directs to achieve this”, the appellant’s role is accountable and defined in his signed duty statement, and the appellant’s responsibility for this is clear and cannot be shifted to others in the organisation.
·The appellant agreed to adhere to the TOIL policy in the future and he was made aware of the Agreement, in particular s 5 “hours of work”, cl 6 “managers of retail outlets”. Mr Knowles stated that he would not retract the statement that “if there is a breach of our procedures in this regard in future, you may face disciplinary action” as he believed the procedures were not followed in respect to the TOIL day taken 20 April 2010.
·Mr Knowles was “concerned that the current and future Dianella financial targets [would] not be accepted by [the appellant] as a measure of both the store’s financial performance and therefore [the appellant’s] own performance” and he believed that the “targets are achievable and that the Operations Manager’s view as to why these are not being achieved is correct”. Further, Mr Knowles stated that “[the appellant’s] position on this and [his] dismissive attitude towards the budget provide[d] [him] with little confidence that this [could] be achieved at Dianella”, and that he had “decided” that the appellant should be transferred to the Armadale store:
Accordingly I have decided that you will be transferred to the recently vacated position of Store Manager at Armadale.
I envisage a number of benefits from this that will resolve the above issues:
•The role has a different Operations Manager;
•The store has had no major layout or retail changes in it since it was commissioned, past performance, current performance and budget can be measured without having to compensation for a significant past change.
This represents a clear opportunity to start fresh. I will instruct the Operations Manager for this store to develop a performance management programme for you and the store, not only in respect to financial performance but other key aspects of retailing.
I understand that the Armadale store is Level One store, however your current salary as a Level Three Store manager will be maintained.
I require your written response as to this decision and to show cause as to why this should not occur by 1pm Thursday 6th May 2010.
On 3 May 2010, in a separate letter, Mr Knowles wrote to the appellant about his claims to vehicle allowance, and asked him to explain why he had submitted claims for days when he was recorded as having TOIL or annual leave, and why he had made multiple claims for the same day. The letter also sought an explanation regarding a banking shortfall on 27 April 2010 of $320.75, and requested a medical certificate for sick leave taken on 1 May 2010.
On 4 May 2010, the appellant wrote to Mr Knowles in an attempt to settle his claim for the outstanding entitlements of $2,759 in respect of unpaid overtime.
On 6 May 2010, the appellant again wrote to Mr Knowles stating that, following the last managers’ meeting, he was made aware that he could claim back for vehicle allowance and Ms Cameron authorised that he could claim back from 1 July 2009 and the dates were worked out to the best of his and his assistant manager’s recollection, and he apologised if they had made any error. As regards the banking shortfall on 27 April 2010, he stated that they had been having continuous computer problems and as such they “had no choice but to write down all the sales for several days and therefore human error could possibly explain this unusual banking shortfall”. As regards the sick leave on 1 May 2010, the appellant said that he attempted to contact Mr Knowles and Mr Gordon at 3.30 pm, but was told they had left for the day so he left messages on their voicemail. The appellant said that the reason for sick leave was to take care of his wife who was ill and his three small children, and he drew to Mr Knowles’ attention s 9 “personal leave”, cl 5 of the Agreement, “Leave exceeding 3 consecutive working days or more requires a medical certificate”.
On 6 May 2010, the appellant again wrote to Mr Knowles and stated that in relation to his performance as store manager and the solution for increasing store revenue he was “prepared to continue to act in a professional manner and to keep working in a respectful way with all other managers”. He stated that he was employed as the Dianella store manager and therefore he did not want to be transferred, for reasons which included:
·the Armadale Store was a level 1 which was below his current level;
·the Armadale Store was under review which was discussed at the last managers meeting, and therefore he could be unemployed in the near future;
·he lived a considerable distance away, meaning longer travelling times and higher fuel costs; and
·he had family responsibilities which he could not meet if he were to be moved.
The appellant added that he thought he was being treated unfairly because he had made a complaint.
On 6 May 2010, Mr Knowles invited the appellant to a meeting on 10 May 2010, and continued to request a medical certificate or alternative by reference to cl 6 of the Agreement, given the appellant’s sick day taken on 1 May 2010 exceeded five days of personal leave without a medical certificate since the appellant began less than 12 months earlier. As to the appellant’s letter dated 4 May 2010 requesting unpaid overtime, Mr Knowles stated that he required “substantive evidence including the basis of calculation together with specifics of days, dates and times for the amount [the appellant was] seeking”.
On 10 May 2010, the appellant and Mr Knowles met. It was decided that a performance management plan would be required to be complied with whether the appellant stayed at the Dianella store or moved to the Armadale store. In his affidavit, Mr Knowles described the appellant’s attitude as “conciliatory” and “positive”.
On 12 May 2010, Mr Knowles wrote to the appellant stating that the appellant would be retained in his role as Dianella store manager and would not be transferred to another store, subject to:
·Ms Wilson assuming the role as the operations manager for the Dianella store and the appellant reporting directly to her; and
·the appellant signing a performance management framework and returning it by 14 May 2010.
The letter of 12 May 2010 also stated that:
·In relation to the appellant’s position as store manager, the relationship between him and the operations manager should be open and professional and the appellant was accountable for the financial performance of the store outlined in the duty statement.
·In response to the appellant’s reasons why the proposed transfer should not occur:
(1)The respondent offered to maintain his salary as a level 3 store manager.
(2)The Armadale store was under review, however the area was geographically attractive and the respondent was committed to it. The respondent was planning to relocate within the area which was similar to what it was doing for two other stores, and accordingly the current manager vacancy had been advertised as a permanent, full-time position and it was their intention to retain the role. All stores were subject to review based on their performance.
(3)It was not the responsibility of the respondent to compensate staff for home to work travel or the reliability of their vehicle by way of employment location.
(4)The respondent provided carer’s leave and flexibility to staff, including store managers, to assist in managing family responsibilities.
·The respondent reserved the right to transfer staff between its locations to meet its operational requirements.
·In relation to the appellant’s vehicle allowance claims, it was not acceptable to make claims for expense reimbursements that could not be verified. It was not the role of payroll and accounting “to act as a routine checking service for [the appellant], especially if [he had] not advised them that [he was] uncertain about a claim, insufficient evidence exists for a claim or the matter [had] not received appropriate approval”. It was the appellant’s responsibility to ensure claims, time sheets, purchase orders and other requests and forms were submitted accurately and with appropriate approvals. Many of the appellant’s claims were not approved for the days he was on TOIL, annual leave or claimed more than once for the same day.
·The appellant was not eligible to be reimbursed for his travel claim from several managers meetings and an interview. Store manager meetings held at Canning Vale “are not eligible for a travel claim. On those days, Canning Vale is the place of work”, and the claim for the 17 December 2009 referred to a job interview for operations manager and he was not eligible for reimbursement “as this was personal business being undertaken by [the appellant], albeit internal to [Good Samaritan Industries]”.
·The respondent accepted that the banking shortfall occurred due to human error.
·The respondent accepted the appellant’s clarification as to the sick leave taken on 1 May 2010.
·In relation to “organisational policy” the respondent requested that the appellant read the policy “PP HR 017 Code of Conduct” as this provided the basis for conduct of the above and other conduct at [Good Samaritan Industries]”. The letter stated that “Any breach of policy in the future may result in serious disciplinary consequences”.
On 17 May 2010, Ms Wilson was told she was responsible for the management of the Dianella store (in addition to a number of stores mostly located south of Perth city she was already responsible for), replacing Mr Gordon. She then made a number of visits to the store during May and June 2010. On one of the days she visited, 20 May 2010, she referred to the performance management framework the appellant had signed.
In his affidavit in the Federal Magistrates Court filed 15 November 2010, at [40] to [43], the appellant stated that Ms Wilson “overloaded my staff and I with extra work and impossible deadlines”, and “my staff and I were already over worked due to a shortage of staff in our store which was well in excess of 100 hours a fortnight”. The appellant described some of the jobs she required as:
·Re-organising the store layout.
·Retraining all staff in colour coding “which meant that every item of clothing in the store had to be relocated”.
·Changes to presentation of stock and systems.
On 19 May 2010, Mr Knowles refused the appellant’s claim for overtime worked having regard to the Agreement, the TOIL policy (PP:HR:07) and reasonable additional overtime. Mr Knowles stated that the additional hours claimed by the appellant were not authorised by the operations manager or any other senior manager at the appellant’s request prior to those hours being worked, and the security logs provided only indicated when the store was being opened and closed, which was not a timekeeping record and did not indicate that work had been commenced or finished.
In his affidavit, the appellant stated that on 3 June 2010, Ms Wilson visited the store and said, “The girls are doing their work, you are not doing your work”. He then expressed his disappointment in his lack of support from Ms Zena Pino and Ms Monique Leenaars, who were present. Ms Pino is described by the appellant in his affidavit as then having “reacted” by shouting angrily at the appellant.
THE JUNE 2010 SUSPENSION AND INVESTIGATION
On 3 June 2010, Mr Knowles became aware of a written complaint of Ms Pino, a full time employee at the Dianella store and a verbal complaint of Ms Wilson.
On 3 June 2010, the appellant was asked by Mr Knowles to come to respondent’s Canning Vale head office to discuss the events that had occurred that morning. As the appellant said he did not feel like driving, Mr Knowles stated in his affidavit that he drove to the Dianella store to see him. Mr Knowles said that he met with the appellant and told him about the complaints. He then wrote to the appellant that day informing him that he was suspended from work on full pay until further notice whilst an investigation was conducted into Ms Pino’s complaint.
On 3 June 2010, Ms Sou Lin Tan, divisional manager of corporate services of the respondent, was instructed by Mr Knowles to conduct an investigation. Mr Knowles said in his affidavit that he felt Ms Tan was the most appropriate person to conduct the investigation as she had not had any major prior dealings with the appellant or any of the other employees at the Dianella store and therefore would be unbiased in her conduct. Mr Knowles stated in his affidavit that he considered instructing an independent third person to conduct the investigation but did not do so because he was concerned about the time it would take and thought it might be intimidating for staff.
On 4 June 2010, Mr Knowles wrote to the appellant outlining the nature of the complaint received, which was that the appellant had:
·used profane language to staff in front of other staff;
·shouted at staff;
·spent an excessive amount of time in his office attending to personal phone calls and other business;
·delegated too much work to his staff that was his responsibility; and
·made staff feel humiliated, pressured and intimidated.
The letter also stated that Ms Tan has been appointed to investigate the matters once the respondent received the appellant’s written response. Ms Tan would then report to Mr Knowles with her findings and recommendations.
On 4 June 2010, Mr Knowles provided Ms Tan with a copy of a second written complaint he had received that day from Ms Leenaars, a full time employee at the Dianella store. The letter complained of the way the appellant spoke to her around March 2010 when “he raised his voice and spoke down to me making me feel like I was useless and nothing was up to his standards”, adding:
·The way he “spoke to me made me feel as if he was blaming me for the loss of money”.
·She felt she took on the appellant’s duties and found herself performing managerial tasks on a regular basis as the appellant would be in the office “constantly on personal phone calls and writing letters and other things, this made my job hard as there were times we couldn’t use the shop phone for business use as [the appellant] would be on personal phone calls”.
·When Ms Wilson requested presentation changes the appellant directed to Ms Leenaars what had to be done and expected her to rearrange the whole shop on her own, then later he took his frustrations out on her because he could not understand the layout of the shop which Ms Wilson had explained to her.
·Ms Leenaars and Ms Pino were asked into the meeting between Ms Wilson and the appellant, and when the appellant asked them if he did enough work around the shop, Ms Leenaars answered “yes and no”.
·After, the appellant asked her “why the hell I didn’t stand up for him, he swore and yelled at me, he also said ‘do you want my f*****g job or something?’”
·She felt that she was “more than capable of running the [Good Samaritan Industries] Dianella store” and felt Ms Pino was capable of being her 2IC “only because I feel this is what we have both done in [the appellant’s] absence and presence”.
On 10 June 2010, the appellant emailed Mr Knowles requesting copies of any letters of complaints received. His request was refused by Mr Knowles that same day. The appellant then informed Mr Knowles that he “totally” denied the allegations referred to in the letter dated 4 June 2010.
On 15 June 2010, Ms Tan provided a report of her investigation to Mr Knowles. Ms Tan states in her affidavit filed 10 December 2010 that, as a result of her investigation, she concluded that:
·in relation to the allegation of the use of profane language to employees in front of other employees – two award wage employees and one supported employee had confirmed this had happened;
·in relation to the allegation of shouting at employees – three award wage employees and two supported employees confirmed this had happened;
·in relation to the allegation of spending excessive amounts of time in the appellant’s office – there was not enough evidence to support the complaint;
·in relation to the allegation that the appellant delegated too much work that is his responsibility – there was not enough evidence to support the complaint;
·in relation to the allegation of making staff feel humiliated, pressured and intimidated – it was likely that as a result of the appellant using profane language and shouting at employees, that they had felt this way.
In Ms Tan’s report under the heading “Review of information gathered from all interviews as it relates to the complaints raised” Ms Tan stated:
1.Interviews with Zena [Pino] and Monique [Leenaars] (complainants) reaffirmed what was written in their letters of complaint and the summary of complaints listed above.
2.Interview with Dana Lakocy – very non-committal except that she liked [the appellant] as he was a nice man. Working in front of the shop, she didn’t hear anything. Would not comment on how much time [the appellant] spent in the office or on the floor.
3.Interview with Joy Wilson – [the appellant] had raised his voice with her on a number of occasions during store visits as well as on Thursday, 3 June. She has had to tell him to lower his voice on those occasions.
4.Interviews with supported employees. One staff confirmed having heard [the appellant] swear and shout at Zina and Monique (no specific occasion(s) indicated). The others had not. Some said he spent a lot of time in the office but would come out and help when asked. One said he would shout instructions at her from back of store which she did not like.
5.Interview with [the appellant] – he denied all allegations, same as he did in his email to John Knowles dated 10 June. I found it difficult to draw information out of him as to what happened when he called the 2 girls into the office to act as witnesses to the discussion between him and Joy. He also said that it ended when Zina left the office. There was no reference to any confrontation between him and Monique which was contradictory to what Monique said.
On 16 June 2010, Mr Knowles wrote to the appellant stating that the respondent had “fully investigated the facts surrounding these matters” and that in summary “the report finds that on balance, the first two complaints can be substantiated”. Mr Knowles stated that the appellant’s actions breached the respondent’s code of conduct, and that:
This breach of the Code of Conduct, namely that you have:
· Used profane language to staff in front of other staff; and
· Shouted at staff in front of other staff;
must be considered in light of my previous advice and the more serious nature of these breaches, means more serious disciplinary action must be taken.
Accordingly, we advise that this letter constitutes a final warning that any further breach of [Good Samaritan Industries’] Code of Conduct will result in disciplinary action being taken which could include termination.
(Emphasis in original.)The letter of 16 June 2010 also addressed “performance management” and stated that:
·On 14 May 2010, the appellant signed his acceptance of a performance agreement outlining the matters that required his attention at the Dianella store and the outcomes that are expected of store managers.
·Upon the appellant’s return from suspension Ms Wilson would work with him to ensure the agreed performance targets were met, as well regularly reviewing progress against the performance agreement with fortnightly assessments concluding 31 August 2010. The letter stated that “Failure to meet the targets outlined in the Performance Agreement could result in termination of employment” (emphasis in original).
·On 31 August 2010, or earlier if any further misconduct occurs before that date, Mr Knowles would review the progress of the appellant’s performance. At this meeting an assessment would be made of the appellant’s suitability for continued employment with the respondent.
·A meeting would be arranged to implement the conciliation process and the appellant’s return to Dianella as store manager, and until that was finalised, he was to remain on suspension with full pay.
On 21 June 2010, the appellant emailed Ms Cheryl Greene, executive assistant, stating he was admitted to hospital on 17 June 2010 for surgery and his doctor had ordered him to have two weeks off work to recover.
On 23 June 2010, Mr Knowles wrote to the appellant stating that as the appellant was unable to attend work to resolve the matter of his suspension, his absence from work from 21 June 2010 to 2 July 2010 would be treated as personal leave, and as at 2 July 2010 he would only have a total of 24 hours personal leave accrued so the respondent intended to treat the balance of leave taken as personal leave without pay. The letter stated the appellant could request to cover the leave without pay from his accrued annual leave entitlement. Mr Knowles also requested a doctor’s certificate and any annual leave request.
On 30 June 2010, the appellant sent an email to Mr Knowles stating that he had contracted a post‑surgery infection and he may have to be readmitted to hospital for further surgery. In relation to the payment during suspension he said he was personally assured that his “personal and annual leave entitlements during this period would not be affected”, that he was subjected to “immense stress” and if his “illness was found to be work related” then he would “immediately be entitled to be fully covered by work compensation”. The appellant attached a medical certificate for 17 June 2010 to 19 July 2010.
On 1 July 2010, Mr Knowles wrote to the appellant stating that the appellant had accrued personal leave to cover his absence to 23 June 2010 but the period 24 June 2010 to 19 July 2010 would be treated as personal leave without pay. The letter stated that should the appellant wish to elect to cover unpaid personal leave with accrued annual leave to advise in writing, and if he was fit to return to work on 20 July 2010 a meeting would be arranged.
On 8 July 2010, the appellant emailed Ms Greene and requested that he be paid all holiday entitlements as soon as possible, but on 9 July 2010 Mr Knowles refused his request, stating that it was not permitted under the Agreement or the National Employment Standards as he had less than four weeks of annual leave entitlements accrued, so instead he proposed that the appellant use the accrued annual leave to cover his personal leave without pay, to which the appellant agreed by email addressed to Mr Knowles dated 9 July 2010.
On 22 July 2010, the appellant emailed Ms Greene stating that his specialist had given approval for his return to work on 26 July 2010. That same day, Ms Greene requested the appellant attend the head office for a meeting with Mr Knowles on 26 July 2012 on his return to work.
On 22 July 2010, the appellant resigned and gave four weeks notice. The letter stated:
This decision has come as a direct result of the unbearable workplace conditions and pressures that I have experienced and endured which you have imposed upon me in my position as Dianella Store Manager during these past months.
On 23 July 2010, the appellant’s resignation was accepted by Mr Knowles on behalf of the respondent. The appellant was not required to serve out the notice period, and was given four weeks pay in lieu plus any other accrued entitlements.
APPELLANT’S SUBMISSIONS ON APPEAL
The primary claims made by the appellant arise under Pt 3-1 (General protections, ss 334-378) of the FW Act. Section 340(1) provides that a person must not take “adverse action” against another person by reason of or on account of certain rights or for certain purposes namely:
(a)because the other person:
(i)has a workplace right; or
(ii)has, or has not, exercised a workplace right; or
(iii)proposes or proposes not to, or has at any time proposed or proposed not to, exercise a workplace right; or
(b)to prevent the exercise of a workplace right by the other person.
Section 340(2) further provides that:
(2)A person must not take adverse action against another person (the second person) because a third person has exercised, or proposes or has at any time proposed to exercise, a workplace right for the second person’s benefit, or for the benefit of a class of persons to which the second person belongs.
The meaning of “adverse action” is set out in the table in s 342. By s 342(1), item 1, adverse action is taken by an employer against an employee if the employee:
(a)dismisses the employee; or
(b)injures the employee in his or her employment; or
(c)alters the position of the employee to the employee’s prejudice; or
(d)discriminates between the employee and other employees of the employer.
By s 342(2) adverse action includes threatening to take action covered by the table.
The expression “workplace right” is defined in s 341 (as it then applied):
Meaning of workplace right
(1)A person has a workplace right if the person:
(a)is entitled to the benefit of, or has a role or responsibility under, a workplace law, workplace instrument or order made by an industrial body; or
(b)is able to initiate, or participate in, a process or proceedings under a workplace law or workplace instrument; or
(c)is able to make a complaint or inquiry:
(i) to a person or body having the capacity under a workplace law to seek compliance with that law or a workplace instrument; or
(ii) if the person is an employee—in relation to his or her employment.
Meaning of process or proceedings under a workplace law or workplace instrument
(2)Each of the following is a process or proceedings under a workplace law or workplace instrument:
(a)a conference conducted or hearing held by [Fair Work Australia];
(b)court proceedings under a workplace law or workplace instrument;
(c)protected industrial action;
(d)a protected action ballot;
(e)making, varying or terminating an enterprise agreement;
(f)appointing, or terminating the appointment of, a bargaining representative;
(g)making or terminating an individual flexibility arrangement under a modern award or enterprise agreement;
(h)agreeing to cash out paid annual leave or paid personal/carer’s leave;
(i)making a request under Division 4 of Part 2‑2 (which deals with requests for flexible working arrangements);
(j)dispute settlement for which provision is made by, or under, a workplace law or workplace instrument;
(k)any other process or proceedings under a workplace law or workplace instrument.
Prospective employees taken to have workplace rights
(3)A prospective employee is taken to have the workplace rights he or she would have if he or she were employed in the prospective employment by the prospective employer.
Note:Among other things, the effect of this subsection would be to prevent a prospective employer making an offer of employment conditional on entering an individual flexibility arrangement.
Exceptions relating to prospective employees
(4)Despite subsection (3), a prospective employer does not contravene subsection 340(1) if the prospective employer makes an offer of employment conditional on the prospective employee accepting a guarantee of annual earnings.
(5)Despite paragraph (1)(a), a prospective employer does not contravene subsection 340(1) if the prospective employer refuses to employ a prospective employee because the prospective employee would be entitled to the benefit of Part 2‑8 (which deals with transfer of business).
Section 361 of the FW Act provides that where an allegation is made to the effect that a person took adverse action for a reason that would constitute a contravention of Pt 3.1 of the FW Act, there is a presumption that the action was taken for that reason unless the person taking such action proves otherwise.
361 Reason for action to be presumed unless proved otherwise
(1)If:
(a)in an application in relation to a contravention of this Part, it is alleged that a person took, or is taking, action for a particular reason or with a particular intent; and
(b)taking that action for that reason or with that intent would constitute a contravention of this Part;
it is presumed, in proceedings arising from the application, that the action was, or is being, taken for that reason or with that intent, unless the person proves otherwise.
(2)Subsection (1) does not apply in relation to orders for an interim injunction.
The appellant filed detailed written submissions on the appeal dealing with various acts by which the appellant contended the respondent had taken “adverse action” as defined against him, including but not restricted to his claim that he was constructively dismissed from his employment when the respondent accepted his notice of intention to resign in late July 2010. In short, the appellant in the written submissions set out reasons why a number of actions of the respondent leading up to his resignation should be characterised as “adverse action” as defined in s 342.
At the hearing of the appeal, however, counsel reasonably focused his submissions on behalf of the appellant on the “because” issue raised by s 340. That is to say, whether any of the alleged adverse actions occurred because of one of the proscribed reasons listed in s 340(1)(a) and (b).
Counsel submitted that Australian Licensed Aircraft Engineers Association v International Aviation Service Assistance Pty Ltd [2011] FCA 333; (2011) 193 FCR 526 at [280] emphasises that once conduct is identified as falling within the meaning of “adverse action” as defined, then the question under s 340 is whether the adverse action has been taken because of one or other of the reasons or purposes described in s 340(1)(a), 340(1)(b) or s 340(2). The s 361 reverse onus provision then has effect.
Counsel contended that, following his initial period of employment, everything identified by the appellant as “adverse” or “discriminatory” action against him was to be explained in part because of the 6 April 2010 complaint following the role‑playing exercise on 30 March 2010, and the meeting with Mr Gordon on 31 March 2010.
Counsel submitted that from the time of his commencement of employment on 22 June 2009 until March 2010 the appellant’s employment had been without incident. This was evidenced, for example, by the facsimile dated 15 February 2010 from Mr Gordon to the appellant outlining changes required for the front of the store such as cleaning windows, mechanising, and other areas. This was followed up by a facsimile dated 24 February 2010 again from Mr Gordon to the appellant which opens “Thanks for the efforts of you and your team in regard to implementing the changes to the store from my visit on 12/2/2010”. The appellant submitted that there is no evidence as to any unsatisfactory performance by the appellant up until the time of the managers’ meeting which occurred on 30 March 2010.
Counsel noted that at that meeting the appellant was required to engage in a role-play in front of his peers, and he used the word “darl” in addressing one of the women in the role‑play. He was dressed down in front of his peers in relation to the inappropriate use of such language and the appellant’s evidence is that he felt humiliated by that public dressing down. He noted that Ms Cameron, who remonstrated with the appellant at that time, subsequently conceded to her employer, Mr Knowles, that she could have responded in a different way.
The appellant said that what happened was that Mr Gordon approached him the next day to reinforce Ms Cameron’s view that his language was inappropriate and to criticise the appellant for other performance-based issues, for example, in relation to the budgetary performances of the store. Counsel submitted that when one looks at evidence in relation to the budgetary performance of the store, the calculations were only just under budget, if at all, at the time in which Mr Gordon criticised him. This suggests a weak case for complaint.
Counsel submitted that essentially what happened was that a strategic decision was made in relation to the Dianella store before the appellant was employed that they would change the dynamic of the store in terms of what they were selling: that the respondent would increase the allocation for clothes and reduce the allocation for sundries. The appellant’s concern was that the sundries aspect of the store was generally seen as the more profitable aspect and it would impact adversely upon him. The appellant’s evidence was that he was assured that was not going to be the case, and part of his complaint was that, when criticised by Mr Gordon on 31 March 2010, the criticism did not have a foundation.
Counsel submitted the situation went irretrievably downhill for the appellant in terms of how he was treated in his capacity as the manager of the Dianella store from that point on. Then, in Mr Knowles’ attempt to achieve a resolution of the complaint or conflict, the entire complaint was given to Mr Gordon for his review and response. In summary, in the document titled “Response to letter from Agustin Ramos dated 6/4/2010”, Mr Gordon stated:
·He could confidently say that all his discussions and dealings with the appellant since the appellant has been employed had been delivered in levelled tones, objective and with the intention of trying to provide him with the information and direction needed to help make the Dianella store a success.
·The appellant had failed to consistently maintain his store full of stock and the decisions that he has taken had definitely resulted in the loss of revenue for his store. The appellant seemed to take no responsibility for any shortcomings in the store.
·He did not believe that the appellant accepts constructive criticism and direction in the manner that it is intended, to help maintain the benefit of the store. He found himself debating with the appellant about clear instruction he had given to the point where on one occasion he had a ten minute conversation about whether a display rack was full.
·He had defended the store in budget meetings with regard to reducing the sundries prices, reducing the sundry floor space and the lost trade due to the roof collapse, in relation to declining sundries sales.
·He discussed the reasoning and strategies behind the relay – by lowering sundries price they would address customer concerns about pricing and slowly rebuild customer numbers, maintaining full shelves in the sundries and full hanging in the linen department was critical for this to occur. The flipside to this strategy was to make more floor space available for ladies clothing, the area in which as a retailer it has most success in. The critical element to this is to maintain full clothing racks.
·He told the appellant that he did not strongly disagree with the appellant that the store relay had affected store sales, and that the changes would have an adverse affect on sundries sales but the shortfall could be made up in clothing sales. The disagreement was that the appellant did not do enough in his efforts as store manager to help make the strategy succeed.
·The appellant was not blamed 100% for the loss of revenue in his store, there were obviously outside factors that contributed which the appellant raised and Mr Gordon discussed with Ms Cameron. However, when the Dianella store was performing so much below like other stores in the current economic climate questions had been raised.
·There were inconsistencies between the appellant wanting to make the Dianella store successful again and some of his actions as store manager. Mr Gordon used the example of letting his fulltime 2IC become part time without checking with Mr Gordon or Ms Cameron, and in the end having to compromise to let the 2IC have Thursdays off – the busiest days of the 50% promotions as well as Dianella furniture delivery day, therefore being constantly short staffed on this day.
·He used the example of the appellant telling him he was on “late starts” which meant every second week the 2IC did the bookwork and banking so he came in at 9am. A conversation ensued regarding Mr Gordon’s experience of running retail outlets, and he used the example of while the 2IC is doing bookwork the store manager would be in the store processing stock – Mr Gordon assumed this is why the appellant stated that he insisted he work overtime. The appellant raised the issue of working 80 hour weeks at other jobs, and Mr Gordon specifically stated that this is not what he was asking him to do, and he commented that he has no problem with authorising time off for appointments, kids assemblies etc in recognition of putting in extra time as a store manager (i.e. coming in early to process stock or do bookwork).
·In regards to the overtime the appellant stated that he accrued, Mr Gordon had not authorised any overtime for specific tasks to be done as per the PP:HR:07 policy and did not know how the appellant calculated the overtime.
·In conclusion, Mr Gordon found the appellant to be “very frustrating and difficult to deal with as Store Manager” and could easily say in all his fourteen years as a retail operations manager he had never dealt with a more difficult individual. All the points raised in the appellant’s letter of complaint had been discussed with him at length and in an objective and professional manner, and he believed the appellant “ha[d] difficulty taking constructive criticism and [felt] that he need[ed] to argue points being raised”.
Counsel for the appellant submitted that in the document titled “Responses to outcome report”, Mr Gordon dealt with topics of mutual respect, proper conduct procedures, accountability, accusations and instructions, and agreed overtime, and stated:
·The appellant was inconsistent in showing respect, for example the wording of his complaint was “designed to exaggerate and mislead what discussions really took place”.
·He had “very serious issues with [the appellant’s] integrity, professionalism and commitment”.
·A store manager’s responsibilities are clearly defined in the store manager’s duty statement which the appellant received with his letter of offer of employment. The appellant was responsible for following his direction and implementing any strategies the respondent regards as necessary and he could not opt out of his responsibility.
·He had never made any accusations about the appellant.
·He had never authorised overtime for the appellant as per the PP:HR:07 policy and to his knowledge the appellant had never recorded any overtime on a register of TOIL owed/taken form.
Counsel highlighted that it was after the receipt of Mr Gordon’s response that Mr Knowles addressed the letter to the appellant dated 23 April 2010, and it is quite clear that he formed his views based in part upon the feedback he received from Mr Gordon.
Counsel acknowledged that the letter of Mr Knowles dated 3 May 2010 dealing with the decision to transfer the appellant to the Armadale store does not take the appellant very far with his adverse action claim because the transfer never eventuated and by ensuring, on its face, that the appellant would not be any worse off by being transferred. The transfer issue was not pressed further by counsel.
Counsel submitted, however, that the respondent, by the letter dated 12 May 2010, effectively placed unilateral conditions upon the appellant staying at the Dianella store. First, that he would be managed by Ms Wilson. Secondly, that he would enter into a performance management framework. The performance management framework identified the Dianella store as performing at 6.8% below the previous year, and compared the Gosnells and Osborne Park stores which were tracking slightly over the previous year figures (2.5% and 2.6% respectively). It is the appellant’s submission that these conditions effectively changed the terms of employment because the appellant was placed under pressure as a result of different reporting and constituted adverse actions.
When further questioned as to how the performance management framework changed the terms of employment, or whether those employment terms already enabled such a performance management framework to be put in place, counsel submitted that the framework placed a condition on his employment that was not previously there, and that it gave rise to a framework or a paradigm which meant, if he did not comply with the performance management framework, this would inevitably lead to a disciplinary process. The appellant’s evidence was that, if he did not accept these terms within the stipulated timeframe, then his job was on the line.
Counsel submitted Ms Wilson’s subsequent supervision was intense, as she visited the store almost every single day from 3 June 2010, spending as much as half a day directly overseeing the appellant’s performance.
Counsel said that the subsequent suspension following the early June 2010 complaints about him constitute adverse action. He had no idea who made the complaint. The suspension injured his employment arising out of a denial of a workplace right. The appellant says cl 17 of the Agreement sets out the disciplinary steps that ought to be taken before something as severe as a suspension is brought into play.
The appellant said that in the context of what the discipline procedures are within the Agreement, the ability to participate in the process that is set out gives rise to a workplace right of its own right, which would legitimately bring the act of suspension into the realm of attracting the adverse action provision, even without relating it back to the earlier events occurring from 6 April 2010.
The appellant says that the adverse action was for a prohibited reason, and that it was action taken which injured his employment in a way that fulfilled the criteria of s 342(1), in that there was no justifiable reason for Mr Knowles on behalf of the respondent to suspend him after having regard to both the facts of what occurred, the workplace instrument itself and previous conduct in relation to how complaints about conduct had been undertaken, and this could only be explained because the respondent did not like the fact that the appellant made the complaint in the first instance.
The investigation process that following the suspension, the appellant submits, gave rise to another adverse action as the investigation process itself was conducted in a way that was procedurally unfair to him. Ms Tan was appointed to investigate and another subordinate employee of the appellant, Ms Leenaars, made a written complaint which was brought to Ms Tan’s attention on 4 June 2010.
Counsel submitted there are enormous difficulties with the veracity of Ms Leenaars’ evidence, as there is a lack of information provided as to her motivations for providing the letter. The appellant stated in his affidavit filed 15 November 2010 that both Ms Pino and Ms Leenaars “had motive to conspire against me” as both of them had previously expressed to him their own reasons why they “urgently required” to increase their income and he says their intentions are documented in Ms Leenaars’ letter to Ms Wilson relating to the events of 3 June when she stated she is “more than capable of running the [Good Samaritan Industries] Dianella store” and felt Ms Pino was capable of being her “2IC”, “only because I feel this is what we have both done in [the appellant’s] absence and presence”. Counsel for the appellant challenged the veracity of Ms Leenaars’ evidence as she was formally warned of inappropriate workplace behaviour, had been the subject of customer complaints and had herself used profane language. Counsel said there is supplementary affidavit evidence that Ms Leenaars’ was subsequently investigated whilst in the employment of the respondent.
Counsel submitted Ms Leenaars’ evidence is relied upon nonetheless by Ms Tan for findings that are clearly adverse to the appellant, that, in the face of clearly conflicting evidence from other employees, the appellant had breached a number of items of the code of conduct. The appellant says there was contradicting evidence by other employees that Ms Tan interviewed, who said that they heard no such incidents of the appellant using profane language .
The appellant says the investigation was also procedurally unfair because he was not made aware of who was accusing him and was not made aware of what specific allegations he had to answer. This, he says, gives rise to unfairness when compared with the way in which the investigation of Mr Gordon’s conduct was undertaken three months earlier, and also the disciplinary procedures contained in the Agreement. These actions breached s 340(1) of the FW Act in terms of prohibited actions, as it was conduct which discriminated against him and injured him in his employment.
Counsel for the appellant submitted that a “workplace right” under s 341(1)(b) includes the ability “to initiate, or participate in, a process or proceedings under a workplace law or workplace instrument” and the appellant’s Agreement sets out a process and rights that are fundamentally at odds with how he was treated.
Counsel submitted that following these events the appellant underwent surgery and that the letter from the respondent dated 23 June 2010, which stated that given he was unable to attend work to resolve the suspension his absence would be treated as personal leave (of which he had only limited personal leave accrued), constituted another adverse action.
As to the TOIL issue argued in the Federal Magistrates Court, counsel submitted that it did not require the level of attention devoted to it in the Court below, as it just forms part of a “basket of facts” which all add up to establishing the adverse actions, which include “the non‑issue” in relation to the budgetary performance, the comparison of the intense supervision of the appellant by Ms Wilson compared to what was occurring under Mr Gordon, the suspension as a result of the complaints handling process, the way in which the investigation was undertaken, the way suspension with pay was transformed from a full right, and the decision of the appellant to resign.
In summary, counsel for the appellant submitted that the sequence of events which led to the suspension, and the refusal of sick leave, after a reasonably unblemished record were because of the initial complaint made.
RESPONDENT’S POSITION
The respondent says that the various actions taken against the appellant, in all the circumstances, would have been the same had the appellant’s complaint not be made, and all had a justifiable reason. The respondent says the Federal Magistrate found it discharged the onus under s 361 in respect of all of the allegations of adverse action contained in the points of claim. The reason that motivated the event was not the complaint, and the direct evidence in the Federal Magistrates Court is to the contrary.
The respondent submitted the appellant cannot sustain the argument that as a result of his initial complaint, everything that happened to him was as a result of that complaint. It says there is no evidence that justifies setting aside the findings of credibility of the reasons for actions that were given by Mr Knowles and Ms Wilson and accepted by the Federal Magistrate.
The respondent says there were ongoing problems with the store prior to the appellant’s complaint dated 6 April 2010. For example, in his letter of complaint the appellant stated “I have previously voiced my concerns about the store relay … but in every occasion [Mr Gordon] told me that he strongly [disagreed] with me”. Furthermore, Mr Gordon questioned him when he allowed his assistant manager to have Thursdays off and he questioned him in regards to starting late at 9.00 am one morning – these matters having been either raised on 31 March 2010 or even earlier. The respondent says there may not have been major issues that had resulted in formal disciplinary inquiries, but there was a concern about the appellant’s performance which were in existence before the complaint was made.
In relation to cl 17 of the Agreement, “Dispute resolution procedures”, the respondent says there was an attempt after 6 April 2010 to follow the procedure. This proceeding in any event does not concerns a general protection application, so the issues is: if the respondent did not follow the procedures, it was because the appellant made the complaint.
The respondent says there never has been an allegation that Ms Tan made the findings as a result of the investigation because of the complaint. It says Ms Tan was not cross‑examined and the Federal Magistrate accepted that there had been an investigation which was a finding of fact.
In relation to the proposed transfer to the Armadale store, the respondent says it was a management decision related to the breakdown in the relationship between the appellant and Mr Gordon. It says the appellant was given an opportunity to show cause as to why the transfer should not occur. As a result of the appellant’s reply, there was a change in management, which was a reasonable response in the circumstances.
In relation to the suspension on full pay, the respondent submitted this is a normal procedure and in these circumstances Mr Knowles drove to the appellant’s store to speak with him and explained that a suspension and investigation would take place. It says, generally speaking, if there is a complaint that concerns unpleasantness between various employees, it is often that suspension on full pay is implement while an investigation occurs.
The respondent submitted that every single action taken had a justifiable basis and the appellant’s decision to resign was not a constructive dismissal.
DISCUSSION
This appeal against the decision of the Federal Magistrates Court is made pursuant to s 24(1)(d) and s 25(1AA) of the Federal Court of Australia Act 1976 (Cth) (FCA Act). In such an appeal, by s 27 of the FCA Act, the Court must have regard to the evidence given in the proceeding out of which the appeal arose and has the power to draw inferences of fact and, in its discretion, to receive further evidence. By s 28 of the FCA Act, the Court in the exercise of its appellate jurisdiction may affirm, reverse or vary the judgment appealed from; give such judgment, or make such order, as, in all the circumstances, it thinks fit, or refuse to make an order; and set aside the judgment appealed from, in whole or in part, and remit the proceeding to the Court from which the appeal was brought for further hearing and determination; amongst other things.
By reason of the broad terms of these provisions governing an appeal against the decision of the Federal Magistrates Court in question here, questions of both fact and law may be the subject of appeal. While these provisions do not expressly refer to the “appeal” being one “by rehearing”, a form of words often found in provisions of a statute permitting an appeal to a court, because the Court under s 27 must have regard to the evidence given in the proceeding out of which the appeal arose and may draw inferences of fact and, in its discretion, receive further evidence, it is to be understood that the nature of the appeal is by way of rehearing of the evidence in the Court below supplemented by such further evidence as the appellate court admits under its statutory power to do so, being the third category of appeal identified by Mason J in Builders’ Licensing Board v Sperway Constructions (Syd) Pty Ltd (1976) 135 CLR 616 at 619‑622 and discussed in Fox v Percy [2003] HCA 22; (2003) 214 CLR 118 (Fox v Percy), for example at [20] (Gleeson CJ, Gummow and Kirby JJ); see also Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission [2000] HCA 47; (2000) 203 CLR 194 at [17] (Gleeson CJ, Gaudron and Hayne JJ).
It is understood that the nature of an appeal by way of rehearing, including where the evidence may be supplemented in the discretion of the Court, does not involve a completely fresh hearing by the appellate court of all the evidence. The Court proceeds on the basis of the record and fresh evidence that, exceptionally, it admits. In Whittaker v Child Support Registrar [2010] FCAFC 112 at [2], the Full Court of this Court (Keane CJ, Moore and Perram JJ) observed that on an appeal to the Court it is not open to determine issues of fact as if the findings of the primary judge had not been made. The Court added that while the appeal is an appeal by way of rehearing, the Court’s function “is to correct errors in the decision below”. Thus, it is necessary for an appellant to identify putative errors and to articulate the basis on which it is said that error has occurred. The Court added that this is particularly important where the findings of the primary judge depend upon the judge’s view of the credibility of witnesses, having regard to the constraints within which a challenge to findings on credibility in an appeal by way of rehearing must be decided, as discussed in Fox v Percy at [23].
The responsibility of the Court on such an appeal is to give the judgment which, in its opinion, ought to have been given in the first instance but observing the natural limitations that exist in the case of any appellate court proceeding wholly or substantially on the record. As observed in Fox v Percy in the joint judgment of Gleeson CJ, Gummow and Kirby JJ at [23], these limitations include the disadvantage the appellate court has when compared with the trial judge in respect of the evaluation of witnesses’ credibility and of “the feeling” of a case which an appellate court, reading the transcript, cannot always fully share. Furthermore, the appellate court does not typically get taken to or read all of the evidence taken at the trial.
Nonetheless, as their Honours stated, at [25], within the constraints marked out by the nature of the appellate process the appellate court is obliged to conduct a “real review” of the trial and, in cases where the trial was conducted before a judge sitting alone, that judge’s reasons. Appellate courts are not excused from the task of weighing conflicting evidence and drawing their own inferences and conclusions though they should always bear in mind that they have neither seen nor heard the witnesses and should make due allowance in this respect.
Accordingly, as their Honours noted, at [27], if, making proper allowance for the advantages of the trial judge, the appellate court concludes that error has been shown, they are authorised, and obliged, to discharge their appellate duties in accordance with the statute. Their Honours noted that in particular cases incontrovertible facts or uncontested testimony will demonstrate that the trial judge’s conclusions are erroneous, even where they appear to be, or are stated to be, based on credibility findings.
Their Honours further noted, at [29], that this is so is demonstrated in several recent decisions of the High Court. In some quite rare cases, although the facts fall short of being “incontrovertible”, an appellate conclusion may be reached that the decision at trial is “glaringly improbable” or “contrary to compelling inferences”.
The Court on this appeal necessarily has regard to these reminders in the joint judgment in Fox v Percy and indeed in the other judgments in Fox v Percy of the Court’s responsibility to closely regard the evidence in and the findings of the Court below in assessing the errors alleged by the notice of appeal to have been made in the Court below.
In this case, the task of reviewing the evidence and the findings on appeal is made a little more difficult in that not only are there what might be considered to be credibility findings made by the Federal Magistrate, in that his Honour accepted the evidence of Mr Knowles and Ms Wilson, but in a number of respects the evidence of those witnesses called by the respondent appears not to have been challenged by the appellant at trial.
All of this is important because Mr Knowles gave direct evidence that none of the steps he took at material times were taken because the appellant had made a complaint. This evidence was given by Mr Knowles in his affidavits made 10 December 2010 and 21 April 2011 that were received into evidence and also in a number of places in his oral testimony. The Federal Magistrate accepted the evidence of Mr Knowles in this regard at various passages between [72] and [102].
In so far as the alleged adverse action was taken by Ms Wilson, she too gave direct evidence that none of the supervisory steps she took were taken because the appellant had made the complaint and this evidence was not challenged. The Federal Magistrate accepted her evidence in this regard in his reasons at [89]‑[90].
There is no direct challenge to these findings in the appellant’s grounds of appeal or more broadly speaking in his submissions. In effect, however, the appellant submits that despite the evidence and the findings made by the Federal Magistrate, it is open to the Court to infer, from all the evidence, that the ultimate termination of the appellant’s employment with the respondent was a constructive dismissal and a consequence of the various actions that ensued following the 6 April 2010 complaint made by the appellant, and that each of the actions culminating in the alleged constructive dismissal were “because” of the existence or exercise of the appellant’s workplace right to make a complaint.
In my view, whatever be the correct characterisation of each of the actions complained of following the complaint, contravention of s 340(1) cannot be made out because none of the alleged adverse actions is shown to have occurred by reason of or on account of the existence or exercise of the appellant’s workplace right to make a complaint. In terms of s 340(1)(a)(i) none of the alleged adverse actions can be shown to have occurred “because” the appellant “has a workplace right”, namely the right to make a complaint or inquiry, being the workplace right defined in s 341(1)(c)(ii).
There are a number of issues concerning contravention of s 340(1) that are not in doubt. First, there is no doubt and it is not in dispute that the appellant was, at material times, a person able to make a complaint or inquiry in relation to his or her employment. The Agreement provided for that and the respondent does not deny it. Thus, the appellant, at material times, had a “workplace right” in terms of that workplace right defined by s 341(1)(c)(ii).
As to whether or not there was “adverse action” as defined at material times requires attention to be given to the meaning of “adverse action” as set out in the table in s 342. If an employee is dismissed by the employer then there is a case of adverse action. Thus, in this case, the appellant alleges he was the subject of constructive dismissal as defined by the FW Act. If constructive dismissal can be made out then undoubtedly “adverse action” as defined can be established. But the fact of constructive dismissal, if it can be established, does not establish contravention of s 340(1). It must additionally be shown that the constructive dismissal was by reason of, or on account of, the rights there listed – which in the present case means that the appellant needs to establish that his alleged constructive dismissal occurred because he had the workplace right to make a complaint in relation to his employment.
It is also open to argue, as the appellant does, that the various steps taken by the respondent, including having Ms Wilson supervise him in the manner she did, suspending him following the co‑workers complaints and the way the subsequent inquiry into the complaints was conducted, and the subsequent unwillingness of the respondent to maintain the appellant’s pay when his sick leave was exhausted, are examples of alteration to the position of the employee to his prejudice, for the purposes of the s 342(1), item 1(c) definition of adverse action.
The appellant in effect contends that he was “squeezed out” of his employment by the sequence and cumulative effect of the arrangements put in place in respect of him following his complaint on 6 April 2010 that, in the result, left him with no option but to resign. Thus, he says he was constructively dismissed because of his complaint.
In Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012] HCA 32; (2012) 86 ALJR 1044 (Barclay) the High Court (French CJ, Gummow, Hayne, Heydon and Crennan JJ) upheld an appeal against a majority decision of a Full Court of this Court that adverse action had been taken “because” the respondent had engaged or proposed to engage in industrial activities, an attribute proscribed by s 346 in conjunction with s 347 of the FW Act. The majority in the Full Court ((Barclay v Board of Bendigo Regional Institute of Technical and Further Education [2011] FCAFC 14; (2011) 191 FCR 212) had observed, at [28], of the “because” question as follows:
The determination of those questions involves characterisation of the reason or reasons of the person who took the adverse action. The state of mind or subjective intention of that person will be centrally relevant, but it is not decisive. What is required is a determination of what Mason J in Bowling at 241 ... called the ‘real reason’ for the conduct. The real reason for a person’s conduct is not necessarily the reason that the person asserts, even where the person genuinely believes he or she was motivated by that reason. The search is for what actuated the conduct of the person, not for what the person thinks he or she was actuated by. In that regard, the real reason may be conscious or unconscious, and where unconscious or not appreciated or understood, adverse action will not be excused simply because its perpetrator held a benevolent intent. It is not open to the decision-maker to choose to ignore the objective connection between the decision he or she is making and the attribute or activity in question.
French CJ and Crennan J in a joint judgment, at [41], stated that the question of why an employer took adverse action against an employee is a question of fact arising from the operation of the interdependent provisions of the FW Act.
Their Honours, at [43], observed that a defendant employer interested in rebutting the statutory presumption in s 361 can be expected to rely in its defence on direct testimony of the decision‑maker’s reason for taking the adverse action. Their Honours stated that the majority in the Full Court correctly rejected an argument put by the respondents that the introduction of the statutory expression “because” into a legislative predecessor to s 346 , in place of the previous statutory expression “by reason of”, rendered irrelevant the state of mind of the decision-maker. Their Honours added that there is no warrant to be derived from the text of the relevant provisions of the FW Act for treating the statutory expression “because” in s 346, or the statutory presumption in s 361, as requiring only an objective inquiry into a defendant employer’s reason, including any unconscious reason, for taking adverse action. Their Honours stated, at [44]:
The imposition of the statutory presumption in s 361, and the correlative onus on employers, naturally and ordinarily mean that direct evidence of a decision-maker as to state of mind, intent or purpose will bear upon the question of why adverse action was taken, although the central question remains ‘why was the adverse action taken?’.
Their Honours, at [45], confirmed that the question is one of fact, which must be answered “in the light of all the facts established in the proceeding”. Their Honours noted that ordinarily direct testimony from a decision-maker will be called in order to displace the statutory presumption in s 361. Direct evidence of the reason why a decision-maker took adverse action, which may include positive evidence that the action was not taken for a prohibited reason, may be unreliable because of other contradictory evidence given by the decision-maker or because other objective facts are proven which contradict the decision‑maker’s evidence. However, their Honours accepted, at [45], that direct testimony from the decision‑maker which is accepted as reliable is capable of discharging the burden.
Having regard to the facts in Barclay their Honours, at [62], said it was an error to treat an employee’s union position and activity as necessarily being a factor which must have something to do with adverse action, or which can never be dissociated from adverse action. Their Honours added that it is a misunderstanding of, and contrary to, General Motors‑Holden’s Pty Ltd v] Bowling [(1976) 51 ALJR 235 (Bowling) at 241 to require that the establishment of the reason for adverse action must be entirely dissociated from an employee’s union position or activities. Their Honours added that the onus of proving that an employee’s union position and activity was not an operative factor in taking adverse action is to be discharged on the balance of probabilities in the light of all the established evidence.
Gummow and Hayne JJ in a joint judgment took a not dissimilar approach to that adopted by the Chief Justice and Crennan J. At [121], their Honours accepted a submission that to engage upon an inquiry contrasting “objective” and “subjective” reasons is to adopt an illusory frame of reference and risks the substitution by the Court of its view of the matter for the finding it must make upon an issue of fact.
Their Honours, at [126], noted that the relevant frame of reference in this case is a statutory provision in which neither the words “objective” nor “subjective” appear. Their Honours noted that no direct challenge was made to what had been said by Mason J in Bowling. Thus their Honours, at [127], accepted that:
In determining an application under s 346 the Federal Court was to assess whether the engagement of an employee in an industrial activity was a ‘substantial and operative factor’ as to constitute a ‘reason’, potentially amongst many reasons, for adverse action to be taken against that employee. In assessing the evidence led to discharge the onus upon the employer under s 361(1), the reliability and weight of such evidence was to be balanced against evidence adduced by the employee and the overall facts and circumstances of each case; but it was the reasons of the decision‑maker at the time the adverse action was taken which was the focus of the inquiry.
Their Honours also observed, at [130], the “natural limitations” that exist in the case of any appellate court proceeding wholly or substantially on the record, as discussed in Fox v Percy. In the circumstances of the appeal before the Court, their Honours noted, at [131], the absence of a challenge to the findings of fact or reasons for the conclusions drawn by the primary judge that the employer did not act for a proscribed reason in taking adverse action and therefore held that that finding must stand.
The approach identified in each of the joint judgments in Barclay emphasises that the question whether an adverse action was “because” of a proscribed reason is a question of fact which requires a careful analysis of the evidence adduced by the employee and the overall facts and circumstances of the case.
In this case there can be little doubt that the respondent, through Mr Knowles as the senior representative of the respondent at material times, had real concerns about the performance of the appellant. As the respondent reasonably argued before the Federal Magistrate and on the hearing of this appeal, each of the steps of which the appellant complains had a real management justification. It was not unreasonable for the co‑worker to raise as an issue the use by the appellant of the expression “darl” at the role‑playing exercise on 30 March 2010. Mr Gordon the following day raised reasonable management concerns with the appellant. That there may be debate about the strength of the concerns raised by Mr Gordon and the appellant may not have agreed with them is not directly to the point. All are matters concerning management. There is nothing in the evidence to suggest that up to and including the events of 30 and 31 March 2010, any of the dealings by representatives of the respondent with the appellant were motivated in any respect by the workplace right possessed by the appellant. Of course it was only when the appellant made his written complaint on 6 April 2010 that there was any exercise of the workplace right to make a complaint.
When that complaint was made it was appropriately looked into. One would expect no less from a employer. The outcomes of the inquiry process ultimately led to Mr Knowles at one point to consider that an apparent personality difference might best be dealt with by transferring the appellant to the Armadale store. In the end that proposal was abandoned. Counsel for the appellant at the hearing reasonably did not place any real significance on that proposal as one constituting an adverse action as defined.
The consequence of those events was, however, that the respondent through Mr Knowles agreed that the appellant should continue as store manager of the Dianella store but that he should have his performance more closely overseen and to that end Ms Wilson was engaged to supervise him. The fact that up to that point Ms Wilson did not have any particular responsibilities in supervising employees at the Dianella store is not to the point. The fact that the respondent, through Mr Knowles, chose to put in place what might be called a closer supervisory program, does not of itself prove that this action was done or performed in a way because the appellant had made the complaint. Indeed, Mr Knowles’ own evidence was that he did not take such action because of the complaint earlier made. Rather, it might be said to be manifest that, on the facts, the respondent was entitled to worry about the management circumstances the appellant presented and that the response it made was designed to ensure the evident problems did not develop.
While there may be some cases where on the facts a different conclusion might be drawn and a different inference available, on the evidence presented in this case there is no basis upon which the Court below or this Court on rehearing could or should draw the inference that at material times the respondent had decided to squeeze the appellant out of his employment because he had made the complaint on 6 April 2010. Rather, the events culminating in the complaint of 6 April 2010 and the remedial steps taken thereafter, as noted, were designed, as Mr Knowles explained and his Honour in the Court below accepted, to achieve good management outcomes. No error is identified in this reasoning.
No doubt, there will be circumstances where, by reason of management issues raised upon a complaint, an employer may consider an employee to be difficult employee. Steps ultimately taken to respond to such management issues identified through a subsequent complaint or inquiry process are not thereby automatically to be identified as steps taken because the complaint was made, that is to say, to be identified as adverse actions taken because of the workplace right.
The subsequent investigation by Ms Tan of the complaint of the co‑workers may, for the reasons advanced by the counsel for the appellant, be considered something less than ideal in terms of a fair hearing. It may be observed that the employee asked by Mr Knowles to conduct the investigation was considered by him to be at a reasonable arms‑length from the parties involved. She was not, however, an outside person, nor a lawyer, or otherwise a person identified as having particular investigative qualities. It may be that aspects of her investigation do not fit the judicial model of a fair hearing in that the appellant does not appear to have been given the letters of complaint, although it may be considered he was broadly made aware of the substance of the complaints. It may be that he could have been given a more adequate opportunity to respond to the complaints made. It may also be suggested undue weight was given to one complainant’s testimony. There is, however, nothing in the work done by Ms Tan and the report she gave to Mr Knowles to suggest that she was at any time motivated to conduct her investigation and to present her report, or did so, by the fact that the appellant had made his earlier complaint on 6 April 2010.
Again, the consequence of the report was that Mr Knowles was required to decide what to do in light of the report and the findings in it. Again, Mr Knowles decided to take action which he said was not in any way affected or motivated by the fact that the appellant had a right to complain and had exercised his right to make a complaint in April 2010.
Again, in light of the findings of the Federal Magistrate, there is no reason to doubt that factual circumstance. It is not reasonably open to this Court in the light of the evidence given and the findings made below and the lack of direct challenge to the evidence given by Mr Knowles, in particular, for this Court to speculate about what the evidence might have been if the cross‑examination in the Court below had followed a different course. The Federal Magistrate’s findings are not shown to be wrong.
Ultimately it is claimed that the appellant felt, in light of his treatment since he made his complaint in early April 2010, that he was being forced to quit. But his subjective assessment in that regard cannot be the benchmark for the determination of whether he was constructively dismissed. It is by no means clear that he had no other option but to quit his employment at that point. He could well have returned to work and continued to negotiate and deal with his employment situation through discussions with Mr Knowles. Indeed, the correspondence shows that Mr Knowles was expecting the appellant to resume work and to engage in such discussions with him.
In all the circumstances, for the reasons given by the Federal Magistrate, it cannot reasonably be concluded that the appellant was constructively dismissed from his employment as store manager at the Dianella store and it has not been shown that his Honour erred in coming to that conclusion.
Further, it cannot be said that any of the particular alleged adverse actions were by reason of, or on account of, the existence or exercise of the appellant’s right to make a complaint to the respondent about his employment. In my view, it was open to the Federal Magistrate to find as he did that all the alleged adverse actions and the ultimate decision of the appellant to resign from his employment arose out of legitimate management and workplace issues to which the respondent was entitled, if not obliged, to respond. Having reviewed all the evidence and the sequence of events, I consider his Honour’s findings were open to him and no appellable error has been identified.
To the extent that the appellant submits that the Court should take a broader view of the sequence of events that occurred that led to the appellant resigning, in order to see through some thin veil covering the fact that the respondent acted throughout according to some carefully designed process to force the appellant to resign, I do not consider that the evidence supports any such conclusion. The reality is that, through his own complaint and subsequent action, the appellant caused the respondent to deal with a range of management issues. The respondent was entitled to take the actions that it did. There was clear evidence given by Mr Knowles and Ms Wilson to the effect that none of the actions that they took was by reason of or on account of the existence of the appellant’s workplace right to complain or the fact that he had exercised that right on 6 April 2010.
Just as in Barclay, where French CJ and Crennan J observed that it was an error to treat an employee’s union position and activity as necessarily being a factor which must have something to do with adverse action, or which can never be dissociated from adverse action, it is equally, in my view, an error to presume, as the submissions made by the appellant here do, that the fact that the appellant had a workplace right to complain to his employer and had exercised that right by his written complaint of 6 April 2010, was necessarily a factor that had something to do with everything that adversely affected the appellant thereafter and which could not be dissociated from the action or actions taken against him. In my view, the Federal Magistrate was right to find, in effect, that the relevant workplace right of the appellant was not an operative factor in the taking of any of the action alleged to be adverse action as defined and that it was not in that sense the operative factor that culminated in the appellant deciding to resign his position.
In my view, no error is revealed in the finding by the Federal Magistrate that the appellant was not constructively dismissed by the respondent in this case in any event.
In all of these circumstances, the facts of the case do not lead to the conclusion that the respondent contravened s 340(1) in any of the ways alleged by the appellant.
For these reasons, the appeal should be dismissed.
I certify that the preceding one hundred and forty-three (143) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justice Barker. Associate:
Dated: 30 January 2013
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