Richard Barrow v Pilbara Iron Company (Services) Pty Ltd
[2023] FWC 2424
•3 OCTOBER 2023
| [2023] FWC 2424 |
| FAIR WORK COMMISSION |
| DECISION |
Fair Work Act 2009
s.394—Unfair dismissal
Richard Barrow
v
Pilbara Iron Company (Services) Pty Ltd
(U2023/3504)
| COMMISSIONER BISSETT | MELBOURNE, 3 OCTOBER 2023 |
Application for an unfair dismissal remedy
On 24 April 2023 Mr Richard Barrow (the Applicant) made an application in which he sought a remedy for unfair dismissal pursuant to s.394 of the Fair Work Act 2009 (FW Act). The Applicant claimed he had been unfairly dismissed from his employment with Pilbara Iron Company (Services) Pty Ltd (the Respondent) on 4 April 2023.
A conciliation conference was held with the parties before a staff conciliator of the Commission on 8 June 2023 where the matter was considered settled. The Applicant now seeks to have his application for remedy for unfair dismissal heard. The Respondent objects to this on the grounds that it says a binding settlement agreement was reached by the parties which suggests that the original remedy for unfair dismissal application has no reasonable prospect of success.
I issued Directions to the parties on 15 August 2023. Both parties filed material in response to those Directions and I granted permission for the Respondent to be represented at the Hearing to determine whether a binding settlement agreement was reached between the parties at conciliation.
Case law
It is well accepted that parties to a dispute may agree to settle on certain terms. At the conclusion of a discussion as to settlement, the parties may have agreed to resolve the dispute in a number of ways. These were most succinctly recorded by the High Court in Masters v Cameron where it was said:
Where parties who have been in negotiation reach agreement upon terms of a contractual nature and also agree that the matter of their negotiation shall be dealt with by a formal contract, the case may belong to any of three cases. It may be one in which the parties have reached finality in arranging all the terms of their bargain and intend to be immediately bound to the performance of those terms, but at the same time propose to have the terms restated in a form which will be fuller or more precise but not different in effect. Or, secondly, it may be a case in which the parties have completely agreed upon all the terms of their bargain and intend no departure from or addition to that which their agreed terms express or imply, but nevertheless have made performance of one or more of the terms conditional upon the execution of a formal document. Or, thirdly, the case may be one in which the intention of the parties is not to make a concluded bargain at all, unless and until they execute a formal contract.
In each of the first two cases there is a binding contract: in the first case a contract binding the parties at once to perform the agreed terms whether the contemplated formal document comes into existence or not, and to join (if they have so agreed) in settling and executing the formal document; and in the second case a contract binding the parties to join in bringing the formal contract into existence and then to carry it into execution. Of these two cases the first is the more common …[1]
A Full Bench of the Commission in Singh v Sydney Trains[2] (Singh) restated these circumstances and added a fourth:
If parties who have been in negotiations reach agreement on terms of a contractual nature and also agree that those terms will be dealt with by subsequent formal documentation, there are several categories into which such negotiations fall. First, the parties reach finality, intend to be immediately bound, and propose restatement of the terms of settlement in a fuller or more precise form but not different in effect. Secondly, the parties have completely agreed all terms but performance of one or more terms is conditional on execution of a formal document. Thirdly, the parties did not intend to make a concluded bargain at all, unless and until they execute a formal contract. Fourthly, the parties intended to be bound immediately and exclusively by agreed terms while expecting to make a further contract in substitution containing, by concept, additional terms. (Citations omitted)
Where an agreement between the parties has been reached of the first, second or fourth type described in Singh, that agreement now binds the parties and the original dispute (in this case, the application for remedy for unfair dismissal) would be replaced by the agreement.
In Australian Postal Corporation v Gorman (Gorman),[3] Besanko J found that a valid agreement (‘accord and satisfaction’) extinguishes the existing (unfair dismissal) application, with a new cause of action based on the agreement reached. Whether there was an agreement reached is a question of fact to be determined by the Commission. If it is found that there is a valid agreement, the original dispute may be found to have no reasonable prospect of success.
It is therefore necessary for the Commission to determine if the Applicant and the Respondent reached an agreement at, or following, conciliation. If they did, it may well be that the application for remedy for unfair dismissal has no reasonable prospect of success and therefore should be dismissed pursuant to s.587 of the FW Act.
The case before me
The Applicant’s evidence
The Applicant agreed that he (along with his representative) participated in a conciliation conference with the Respondent in relation to his unfair dismissal application. The Applicant's evidence at the Hearing was that he did not sign the terms of settlement as he believed them to be incorrect.
The Applicant said that, at the conclusion of the conciliation, there was an agreement that his termination would be changed to a resignation, that he would be given six weeks’ pay and provided with a statement of service.
The Applicant said in his written submissions that he received a copy of the written terms and, upon reading the terms ‘note[d] that there seem[ed] to be no mention of a restriction at working at Rio Tinto in the Agreement’. On noting this, he said he contacted his representative from the Australian Workers’ Union WA Branch (AWU).
On 20 June 2023 the Applicant sent an email to his AWU representative in which he said that there was no mention in the agreement of a restriction on him working for Rio Tinto, that there was no mention of how long such a restriction (if any) would last and requested that, if it was a resignation in good faith, he would like references from his area supervisor and manager to assist him in gaining further employment.
On 10 July 2023 the Applicant’s AWU representative advised him that the Respondent did not agree to changing the terms as he had sought. Shortly after, the AWU advised the Commission that it no longer represented the Applicant.
Following some further attempts by the Applicant to progress his issue with the Respondent, on 6 August 2023 he requested the Commission reopen his matter and hear his claim for remedy for unfair dismissal.
In his request to the Commission on 6 August 2023 the Applicant said that ‘the [R]espondent representative lawyer had made a request “that I do not work for any Rio business” at (sic) time of mediation under the guise of changing the termination to a resignation’ and that this was not present in the agreement given to him to sign following the conciliation. Further, the Applicant said that, while the agreement contained a non-disparagement clause, he had been subject to disparagement, and is aware of former co-workers being told not to talk to him.
The Applicant therefore said that the draft agreement does not reflect what actually occurred in the conciliation.
The Applicant further said that there were matters not discussed in the conciliation which were also not reflected in the agreement, which were now having an impact on his ability to gain further employment. He said he should have been informed of any restriction the Respondent intended to place on him in relation to future employment with it, and that he should have been able to read the agreement before signing it.
The Applicant said that he took the 14 days he believed were available to him to advise the Respondent that he did not wish to sign the agreement (that is, the conciliation was on 8 June 2023 and on 20 June 2023 he advised his AWU representative of his concerns with the agreement).
The Respondent’s evidence
Mr Damien Peter Swingler of the Respondent attended the conciliation on the Respondent’s behalf. His evidence is that, in the conciliation, the conciliator made some introductory remarks, the Applicant’s representative outlined the Applicant’s position, and he then outlined the Respondent’s position. The conciliator then spoke to the parties separately. Mr Swingler said that the Respondent rejected the Applicant’s first proposal that the Applicant be reinstated, but indicated the Respondent was prepared to consider a financial settlement.
After further discussion with the Applicant, the conciliator returned and advised that the Applicant offered to resolve the matter on the basis that his termination be treated as a resignation, that he be provided with a statement of service and with six weeks’ pay.
Mr Swingler said that the Respondent agreed to this and would need 14 days to make payment.
Mr Swingler gave evidence that it is the normal practice of the Respondent to flag the file of any employee who has engaged in unacceptable conduct. Although he advised the conciliator of this, Mr Swingler did not consider it to be a term of the agreement nor a matter to which the Applicant’s agreement was necessary in order to enable the Respondent to settle the remedy for unfair dismissal claim.
Mr Swingler said the conciliator went to speak to the Applicant, then returned to Mr Swingler and advised him that the matter was settled. Mr Swingler said this was the end of the conciliation, and that neither party were called together for a joint session afterwards.
Following the conciliation, Mr Swingler said he received correspondence from the conciliator attaching a letter confirming settlement and the draft terms of agreement for the parties to sign.
Was an agreement reached in conciliation?
In this case, during the conciliation, the Applicant put forward a proposal to the Respondent to settle his claim for remedy for unfair dismissal. His initial proposal (of reinstatement) was rejected but a second proposal, put by him, was accepted by the Respondent without any variation to that proposal.
I am satisfied that, in the Respondent accepting the Applicant’s proposal of a settlement consisting of a recharacterisation of the dismissal to a resignation, statement of service and six weeks’ pay, an agreement was reached between the parties to settle the remedy for unfair dismissal application.
In Singh the Full Bench said: [4]
An offer and acceptance must precisely correspond. The following principles are relevant to this requirement:
● An acceptance corresponds to an offer if it is an unequivocal acceptance of the terms offered.
● An acceptance is not an unequivocal acceptance of the terms offered if it deviates from the offer, even if that deviation is not material or important. However, as a qualification to this principle, if a new term is included in a purported acceptance of an offer and the new term is solely for the benefit of the offeror, then this can constitute a valid acceptance.
● An acceptance will be effective if it does not depart from the terms of the offer, but simply repeats in the offeree’s own words the effect of the offer.
● Acceptance will be effective if it sets out expressly what would be implied by law in the absence of express agreement. For example, an offer may contemplate that, were it to be accepted, a document would be prepared to record its terms. In proposing that a deed be prepared as part of an acceptance of such an offer, the offeree would be stating that which would be implied by law arising from the terms of the offer, namely, that it would be documented in some formal manner.
● Similarly, if a purported acceptance of an offer merely includes the “machinery of working out what was meant by the offer, it is on the same plight as a request for information”. Such a request for information does not revoke the offer and may constitute acceptance of the offer.
Ultimately the question is whether a “reasonable recipient of the acceptance would have regarded it as corresponding to the offer or whether they would have taken the acceptance to be qualifying the original offer such that it would amount to a counter-offer or, at any rate, not an unconditional acceptance of what was originally offered.” Put another way, the language used by the offeree in their acceptance of the offer must be such as would convey to a reasonable person in the position of the offeror a clear and definite decision by the offeree to be bound by the terms of the offer, leaving nothing further to be negotiated.
A purported acceptance which does not correspond to the offer does not necessarily reject the first offer; it is, nevertheless, a counter-offer capable of acceptance. A counter-offer accepted by the original offeror creates a binding agreement.
Conduct of the parties after the making of the supposed agreement is relevant. Such conduct may be considered in order to determine whether the prior dealings between the parties gave rise to a binding contract. (Citations omitted)
In the case before me, the Applicant made an initial offer which was rejected by the Respondent. The Respondent invited a further offer, which was made by the Applicant and accepted without equivocation, by the Respondent. The offer and acceptance precisely aligned. It must be concluded that an agreement was reached between the parties.
The Applicant’s objection goes however not to what is in the written agreement but what is not in the agreement. On his own evidence, the Applicant said at the conciliation that he was aware he could not be employed at a Rio Tinto site. Neither he nor the Respondent raised it as an issue or bar to the agreement at the conciliation.
As to the precise written terms of the agreement, it seems that the only term to which the Applicant takes objection is the non-disparagement term. While the Applicant claims he has been subject to disparagement, he has not provided any detail as to who has done so, in what context it purportedly occurred or that person’s connection to the Respondent. In any event, I am satisfied that such a term is a machinery term, not unusual in an agreement, such that the failure to precisely discuss it as a term does not negate the agreement reached.
The Applicant further said that he took the 14 days available to him under the agreement to consider the terms and that, within the 14 days, he advised his representative of what he wanted (a reference from his area superintendent and his manager). It is unclear how the Applicant came to his belief that he had a further 14 days post-conciliation to put further terms to the Respondent. Certainly, the Respondent had 14 days after the signing of the agreement to effect payment, but this did not give the Applicant 14 days to further consider the agreement. The correspondence from the conciliator sent after the conciliation contained no suggestion of a 14 day ‘consideration’ period and stated: ‘I confirm that you reached a settlement agreement and I attach terms of settlement’.
Conclusion
For the reasons set out above, I am satisfied that the parties reached an agreement on 8 June 2023. The type of agreement reached is of the first kind described in Masters v Cameron — that is, the parties reached finality as to the terms of an agreement, intend to be immediately bound, and proposed restatement of the terms of settlement in a fuller or more precise form but not different in effect.
I do acknowledge the grievance the Applicant now has with the Respondent, but this does not go to the issue of whether an agreement was reached at conciliation. In any event, as I have said and as the Applicant insisted, he was aware of the policy of the Respondent at the time of conciliation but did not suggest this should either be stated in the agreement or that it meant no agreement was made.
In these circumstances, the principles in Gorman as set out above are operative. If the Applicant has a grievance about the agreement he reached, it is a dispute about the agreement itself that is in existence — the dispute in relation to his dismissal has been resolved by the agreement reached.
I am therefore satisfied that the application for remedy for unfair dismissal has no reasonable prospect of success. The application is therefore dismissed pursuant to s.587 of the FW Act.
COMMISSIONER
Appearances:
R Barrow on his own behalf
J McLean of Counsel for the Respondent
Hearing details:
2023.
Melbourne and Perth (video hearing):
September 5.
[1] (1954) 91 CLR 353, 360.
[2] [2017] FWCFB 4562 [53].
[3] [2011] FCA 975 [31].
[4] [2017] FWCFB 4562 [48]-[51].
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