Sam Benjamin Caruana and ALHMU v Courtaulds (Australia)
[1995] IRCA 337
•26 July 1995
INDUSTRIAL RELATIONS COURT
OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
VI 2046 of 1995
B E T W E E N :
SAM BENJAMIN CARUANA & ALHMU
Applicants
AND
COURTAULDS (AUST) PTY LTD
Respondent
Before: Judicial Registrar Murphy
Place: Melbourne
Date: 26 July 1995
REASONS FOR JUDGMENT (Ex Tempore)
(Revised from Transcript)
The Proceedings
In this application under Division 3 of Part VIA of the Industrial Relations Act (the Act) the applicant alleges that the termination of his employment by the respondent on 7 March 1995 breached sections 170DB, 170DC and 170DE of the Act. There was no agreement between the parties as to whether the respondent had a valid reason to terminate the applicant's employment pursuant to section 170DE(1). In those circumstances, following the decision in Salvachandran v Peteron Plastics Pty Limited, (Industrial Relations Court of Australia,
Northrop J, 7 July 1995), the respondent should have been required to commence the hearing. Due to logistical problems with witnesses the respondent was unable to do so and the applicant went first.
The issues in the case ultimately fell into two discrete areas. The first was whether the respondent had a valid reason to terminate the applicant's employment. The second issue was whether, in the termination of the applicant's employment, the respondent had failed to accord him procedural and substantive fairness as required by the Act.
Findings on the evidence
The evidentiary dispute between the parties fell within a very narrow compass. The applicant had, at the time of his termination, been employed by the respondent for some five years. He was a team leader in the Powder Coating Department. In August 1994 the applicant sustained a work related injury to his arms. He attended a general practitioner, Dr Mark Hobart, who practices across the road from the respondent's plant in North Sunshine. The applicant obtained from Dr Hobart a number of WorkCover Certificate(s) of Capacity. Those certificates recorded the doctor's conclusion that for various periods the applicant was unfit for work. He was on modified duties and taking medication prior to his termination.
On 2 March 1995 the applicant's injuries were playing up and he was unable to attend work. He gave evidence that he contacted the respondent and advised an unnamed person that his injuries were playing up and that he would be requesting his doctor to examine him. He was unable to obtain an appointment with Dr Hobart on that day. Dr Hobart gave evidence that he did not work Thursday afternoons. An appointment was arranged for the following morning.
The applicant first attended work on Friday 3 March and confirmed with his superior, Mr Howes, that he, Howes, had obtained the message from the applicant the previous day that he was unable to work. Howes confirmed that he had done so and said that he had “fixed it”, namely his absence. The applicant gave evidence that he told Howes that he would be attending Dr Hobart that morning. The applicant gave evidence that he attended Dr Hobart between 10 and 11 am. He advised Dr Hobart of the difficulties his injuries were causing him.
Dr Hobart referred him to a specialist and gave him a WorkCare Certificate of Capacity. The original certificate was in evidence and records the applicant's condition as: "Tennis elbow R and L". It records the “Treatment/medication” as: "rest analgesia". It records a referral to Dr Larkin, a rheumatologist. In the section of the certificate referring to “Capacity for work” the document records that the applicant was ““Unfit for any work duties from” “2/3/95” to “2/3/95””. (The two dates were in handwriting). In the “Comment” section it is stated: "See above". At the top of the certificate there are three boxes. One of the boxes refers to “Continuing certificate of capacity”. Another refers to “Attendance certificate only”. The latter box is marked “x”.
The applicant gave evidence that when the certificate was handed to him by Dr Hobart he noted that Dr Hobart had failed to record anything in the “Capacity for work” section. He had failed to record the applicant as unfit for work duties on the previous day, namely, 2 March 1995. The applicant said he pointed this out to Dr Hobart who took the certificate from him and completed the entries “2/3/95” twice and handed it back. In cross-examination the applicant said that he asked Dr Hobart, did “I need to be covered for the previous day?” Dr Hobart said, “sorry, (he) would fix it up,” which he did there and then. The applicant said that this all took place as he was leaving Dr Hobart's office at the end of the consultation.
After receiving back the certificate the applicant made an appointment to see Dr Hobart for review in two weeks and then returned to work with the certificate. He handed it to Howes and resumed his duties until he clocked off at 3 pm. Sometime later that day the Health and Safety Officer of the respondent came into possession of the certificate. He noticed a discrepancy in the certificate in that it was marked as an “Attendance certificate only”, yet it recorded the applicant as being unfit for work duties on “2/3/95”.
The certificate should have been marked as a “Continuing certificate of capacity”. The Health and Safety Officer contacted Dr Hobart and queried the certificate. Dr Hobart was also advised at that time that the two date entries in the “Capacity for work” section did not appear to be in his handwriting. Dr Hobart checked the carbon copy of the certificate and told the officer that he couldn't remember completing the date entries. The date entries did not appear on the carbon copy. After the respondent obtained this information it formed the view that the matter was serious and on Monday 6 March determined to suspend the applicant and investigate the matter.
The Senior Site Delegate of the respondent, Mr Davies, and the co-delegate, both of the second applicant, were called in by the respondent's management. They were then advised by Mr Noel Halford, the Human Resources Manager of the respondent, that the respondent believed that the matter was serious and that a criminal offence may have been committed. The applicant was called in and the matter of the certificate was put to him. He explained what had happened and denied that he had in any way altered the certificate. The applicant was suspended with pay pending an investigation.
Halford and the two union delegates then attended at Dr Hobart's surgery and viewed the carbon copy of the certificate. Dr Hobart, when questioned by Davies, the Senior Site Delegate, denied adding the dates to the original certificate and also denied that he could have forgotten that he had done so within his busy practice. The next day Davies was advised by Halford that the respondent had determined to terminate the applicant's employment. A meeting of the employees was called by the union and a decision taken to take industrial action.
A meeting was then held attended by the applicant, the two delegates, a union organiser and members of senior management of the respondent. The meeting was robust. The applicant again denied any wrongdoing and the union officials sought to persuade the respondent to reconsider its decision. The respondent would not alter its position and the applicant was handed a letter advising him that his employment had been terminated. The letter recorded the investigation by the company, the union participation in it and concluded:
As a result of those investigations the company has concluded that your explanation for the irregularities is not acceptable.
Dr Hobart's evidence
Dr Hobart gave evidence generally consistent with the above account. He denied that the date entries were in his handwriting. He said that the applicant had not sought a certificate to cover his absence on 2 March 1995. He said that had it been requested he probably would have given it even though it was retrospective. Dr Hobart said that in his conversation with the union delegate and Halford it had been suggested that the patient had attended later on in the day of the consultation to have the certificate altered.
He said he would have recalled doing that and he did not do so. Halford gave evidence that he had asked Dr Hobart whether he had written the dates at a later time and he denied it. Dr Hobart gave evidence that he had a busy practice but that he was careful with WorkCover certificates. He said that he had altered such certificates in the past and when he did so he would usually amend the carbon copy. He said that if a patient requested an amendment, and he thought it was reasonable, he would so amend it. In addition to the disputed certificate, some ten prior certificates in similar form relating to the applicant were in evidence. In addition, three other WorkCover certificates of the same nature, but in a different layout, were also in evidence. The ten “Certificates of capacity” show that on each of them Dr Hobart had completed the section relating to “Capacity for work”. They show that on two occasions Dr Hobart had completed that section for a day or days which had already passed.
The applicant gave evidence that one of those certificates related to an incident where he had been unable to work and had been unable to see Dr Hobart on the day of his incapacity. He had seen his local general practitioner instead and obtained a certificate from that practitioner. This certificate had been rejected for WorkCover purposes by the respondent. Dr Hobart, at a later time, had provided a certificate for WorkCover purposes for that period of incapacity. The previous certificates in evidence also show that on 15 November 1994 Dr Hobart had omitted to complete a particular box at the top on a similar form.
On another certificate, dated 7 November 1994, which was marked, like the disputed certificate, as an “Attendance only certificate”, Dr Hobart had completed an entry in the “Capacity for work” section. Dr Hobart accepted that the disputed certificate was thus different from the earlier certificates in so far as the carbon copy showed that he had failed to record any entry for “Capacity for work” on the disputed certificate.
Weighing the competing evidence
The applicant was attacked in cross-examination on the basis that he had a motive to amend the certificate to ensure that he was paid for his day of absence. The applicant's evidence was that he had no need to amend the certificate because the respondent's practice was that provided an employee notified the company of absence from work,at the expected time of his commencement of duties, and he had taken no more than six days sick leave in that calendar year, no medical certification was required. The applicant gave evidence that he had confirmed with Howes that the respondent had received his message the previous morning.
It was submitted that, given Dr Hobart's evidence that the applicant had not requested him to certify him for the previous day's absence, the applicant had a motive to alter the certificate to give him cover for that day on WorkCover. There is no doubt that the applicant had a reason to obtain a certificate covering 2 March 1995. That reason was that he had been absent from work on that day on a work related injury. It was common ground that had he not provided a certificate covering the absence he would have been paid for that day by way of sick leave. Mr Halford virtually conceded that.
Given this situation I am not satisfied that there was a compelling motive for the applicant to alter the certificate. Support for this conclusion can be gained from the past history of the dealings between the applicant and Dr Hobart. He was just over the road from the plant. He had provided numerous certificates. He had been accommodating in providing, albeit reluctantly, a retrospective certificate on more than one occasion. Ten previous certificates recorded entries in the disputed section of the certificate. The applicant, given this history, could have expected such an entry on this occasion.
Dr Hobart gave evidence that a certificate with one day's retrospectivity was commonplace. The applicant, therefore, was in an easy position to return to Dr Hobart and obtain an amendment if he required it. Indeed these considerations are important in weighing Dr Hobart's testimony. He denies the date entries were made by him, but concedes that if requested he would have issued a certificate in that form, and in the form that the disputed certificate appears, had he been requested by the applicant. This is important, given his prior knowledge of the applicant's history.
There was no suggestion that the applicant was other than a genuine patient. Thus the certificate, but for the discrepancy in the writing, is unexceptional. This lends credence to the applicant's version that the conversation where he sought the certificate to be amended was also unexceptional. Such a quick amendment by Dr Hobart could also explain why the incorrect box at the top was not amended. The changed nature of the certificate, requiring a change in the heading box, could have been overlooked in the rush of the transaction.
I note that the disputed certificate contains two omissions not present in each of the other 10 similar certificates. These are the applicant's suburb, and also the ticking of a box which records that the injury was consistent with the patient's description of its cause. This may be an indication that Dr Hobart completed the certificate in haste. Overall, given the applicant's history with certificates, and his condition, I find it more probable than not that he asked Dr Hobart for a certificate to cover his previous day's absence.
Assessment of credibility
Neither the applicant nor Dr Hobart had their credibility shaken in cross-examination. I am satisfied that both were attempting to recount events as best they could. The representative for the applicant asserted that Dr Hobart had a motive to deny that the date entries were made by him. This motive was suggested to be his relationship with the respondent and the need to protect a flow of patients. I reject that. I am satisfied that he was an honest witness recalling events as best he could. He had no motive to lie. The question for the Court is to weigh the denial on oath of the applicant that he altered the certificate against Dr Hobart's evidence that he did not make the entries on the certificate, nor was he asked to.
Has the respondent discharged its onus of proof?
Under section 170EDA(1) of the Act the respondent carries the onus of proof that it had a valid reason, pursuant to section 170DE(1) of the Act, to terminate the applicant's employment. The respondent's reason was the proffering by the applicant of the altered WorkCover certificate. The respondent on 7 March rejected the applicant's version of events, and took the view that the applicant had been guilty of misconduct by having altered the WorkCover certificate.
In the light of the decision in Selvachandran (above) it is clear that the respondent, if it could make out the allegation, would have a valid reason to terminate the applicant's employment. In Selvachandran Northrop J said:
In its context in sub-section 170DE(1), the adjective, "valid" should be given the meaning of sound, defensible or well founded. A reason which is capricious, fanciful, spiteful or prejudiced could never be a valid reason for the purposes of sub-section 170DE(1). At the same time the reason must be valid in the context of the employee's capacity or conduct or based upon the operational requirements of the employer's business. Further, in considering whether a reason is valid, it must be remembered that the requirement applies in the practical sphere of the relationship between an employer and an employee where each has rights and privileges and duties and obligations conferred and imposed on them. The provisions “must be applied in a practical, commonsense way to ensure that” the employer and employee are each treated fairly.
In determining whether the respondent has discharged its onus of proof, reference must also be made to section 140 of the Evidence Act 1995 (Cwlth) which codifies the common law position in this regard. Section 140 provides:
140(1) In a civil proceeding, the court must find the case of a party proved if it is satisfied that the case has been proved on the balance of probabilities.
(2) Without limiting the matters that the court may take into account in deciding whether it is so satisfied, it is to take into account:
....
(c)the gravity of the matters alleged.
Here the respondent's allegation against the applicant is a serious one. The respondent is asserting the applicant had altered an important document for his own benefit. Halford's evidence was that if the allegation was correct then there had been a breach of the Accident Compensation Act and possibly it was a matter for the police.
In weighing the competing probabilities, a primary consideration is the honest and forthright evidence of Dr Hobart. He denied making the disputed entries, and maintained that the writing was not his. His evidence was consistent with the account he gave at the time of the disputed event. The applicant's representative submitted, however, that although Dr Hobart honestly believed he did not make the entries, he was mistaken in his evidence.
In support of this proposition it was put that the applicant was familiar with the WorkCover certificate and thus would have noticed the omission. This explained why it did not appear on the carbon copy. Further, the applicant had no reason to make the alteration when, given their prior dealings, the doctor would have provided it on request. It was put that Dr Hobart just forgot that he made the entries in the context of his busy general practice. The applicant referred to Dr Hobart's crowded waiting room. There is force in this aspect of the applicant's submission.
It accords with common human experience that a person such as the applicant, who had prior WorkCover dealings with Dr Hobart, would closely check that part of the certificate. After all the previous 10 had been completed. It is possible that Dr Hobart did fail to complete that form, and had to be reminded in an exchange just as the consultation was ending. This explains why the entries are in a different pen and do not appear on the carbon copy. The unexceptional nature of the entries made by Dr Hobart can also explain why he has been unable to recall making them. On his own evidence, the request for a certificate would have been consistent with his practice in the past and his knowledge of the applicant's condition.
The respondent's version of events, on the other hand, lacks cogency in certain respects. I have already referred to the lack of a strong motive on the part of the applicant to make the alteration. He had received 10 other certificates. All he had to do was to pop over the road to obtain the certificate. Why bother to alter it? Perhaps more importantly the Court is in a real state of uncertainty as to Dr Hobart's evidence that the disputed entries were not made by him. No expert handwriting evidence was led. Before the Court, however, was evidence of the applicant's own handwriting by way of samples completed, and his signature and date on the original process in the Court.
Also before the Court were the 13 WorkCover certificates and other documents completed by Dr Hobart. Those documents contain numerous specimens of how Dr Hobart writes numbers. To the untutored lay observer there is a significant similarity between the disputed dates and those specimens of Dr Hobart's writing. On the other hand, there is a stark difference between the applicant's handwriting of numbers and the disputed dates. This leads to the conclusion that to accept the respondent's version of events requires the applicant to have been in a position to procure in a short time on 3 March 1995 a person who could produce a passable copy of Dr Hobart's handwriting. This strikes the Court as improbable.
The respondent was in a position to lead evidence which may have provided assistance to the Court on the probabilities of the disputed entries being made by Dr Hobart, the applicant, or someone else. It has not done so. See Jones v Dunkel (1959) 101 CLR 298. When this failure is combined with the competing considerations which I have just considered and discussed, and the serious nature of the allegation being made, I am not satisfied that the respondent has discharged its onus of proof. I am not satisfied that the respondent has proved to the requisite standard that the applicant altered the disputed certificate. The respondent therefore did not have a valid reason under section 170DE(1) of the Act to terminate the applicant's employment for reasons relating to his conduct or performance.
In reaching the conclusion I have it is important that I record that the Court makes no criticism of the investigation of the respondent. The applicant could offer no real criticism. Davies, the Senior Site Delegate, grudgingly conceded it was fair and thorough. On the basis of its investigation the respondent, after deliberation, made the decision to terminate the applicant. The Court is required to review the decision on the basis of its own assessment of the witnesses and the evidence before it. The respondent carries the onus of proof that it had a valid reason to take the action it did. I have found that in the circumstances of the allegation which was made the respondent has not discharged its onus of proof.
Having regard to this conclusion, it is not necessary for me to consider the applicant's further argument that the respondent breached section 170DB of the Act in summarily terminating the applicant's employment.
Has there been a breach of section 170DC of the Act?
The applicant's representative also argued that the respondent had failed to give the applicant an adequate opportunity to respond to the allegations against him. The evidence was that from 6 March, when there was a meeting between the two union delegates, the applicant and Mr Halford, he knew what allegation was being made against him. It was made clear, I find on the evidence, that the matter was being treated very seriously by the respondent. It was so serious that he was suspended on pay.
Halford relayed to the applicant and his union the seriousness of the matter. Davies acknowledged that termination of employment was a possible outcome. The union was involved in the interview with Dr Hobart and knew what Dr Hobart's version of events was. In decisions such as Nicolson v Heaven & Earth Gallery Pty Limited (1994) 1 IRCR 199 and Gibson v Bosmac Pty Limited, (Industrial Relations Court of Australia, Wilcox CJ, 5 May 1995,), Wilcox CJ has confirmed that the provisions of section 170DC of the Act are flexible but substantive. In Gibson he said:
Ordinarily, before being dismissed for reasons related to conduct or performance, an employee must be made aware of the particular matters that are putting his or her job at risk and given an adequate opportunity of defence. However, I also pointed out that the section does not require any particular formality. It is intended to be applied in a practical, commonsense way so as to ensure that the affected employee is treated fairly. Where the employee is aware of the precise nature of the employer's concern about his or her conduct or performance and has a full opportunity to respond to this concern, this is enough to satisfy the requirements of the section. That was the situation in the present case.
Northrop J. made similar comments in the decision Johns v Gunns Limited, (Industrial Relations Court of Australia, Northrop J, 18 May 1995).
Applying these comments, I am not satisfied that the respondent has breached section 170DC. The respondent investigated the allegation. It brought in the second applicant. Before the decision of the respondent to terminate the applicant was carried into effect, there was a robust exchange between all parties at which the applicant put his response to the allegation and had his case put. I am satisfied that the respondent has more than satisfied its obligations under section 170DC of the Act.
Remedy
It is now necessary to consider the question of remedy. The applicant, through his representative, sought reinstatement to his former position. The respondent did not lead any evidence to support the position that reinstatement was impracticable. Having found that the respondent did not have a valid reason to terminate the applicant's employment, the applicant, on the authority of Liddell v Lembke (1994) 127 ALR 342, is entitled to the primary remedy under the Act, namely reinstatement to his former position. Since his termination, the applicant has received unemployment benefit. He has also been in receipt of WorkCover benefit and been required to repay the unemployment benefit. The precise amounts are not in evidence.
Under section 170EE(1)(b) of the Act, the applicant in the event of an order for reinstatement, is entitled to an order that the respondent pay to him the remuneration lost by reason of the termination. It is not clear what the applicant has been paid pursuant to WorkCover and it is also not clear what amount of remuneration he would have otherwise received. The respondent is in a position to make the appropriate calculations based on the previous entitlements and work patterns of the applicant.
Having regard to these matters I propose to make an order that the respondent pay the amount of remuneration lost and also treat the applicant as having been in continuous employment from the date of termination.
ORDER OF THE COURT:
that the applicant be reinstated by the respondent to the position in which he was employed immediately prior to the termination;
the reinstatement be effective from the date of this order;
the respondent pay to the applicant the amount of remuneration lost by the applicant as a result of the termination after taking into account the amounts he has received by way of Workcover payments;
that the period between the date of termination and the date of reinstatement be treated as continuous employment of the applicant by the respondent for all purposes;
that the time for payment be 21 days from the date of this order.
I certify that this and the preceding seventeen (17) pages are a true copy of the reasons for judgment of Judicial Registrar Murphy.
Associate:
Dated:
Representative for the Applicant: Mr R. Crampton of
ALHMU - Miscellaneous Workers
Division
Solicitor for the Respondent: Dunhill Madden Butler
Counsel for the Respondent: Mr P. Ludeke
Date of hearing: 25 July 1995
Date of judgment: 26 July 1995
C A T C H W O R D S
INDUSTRIAL LAW - TERMINATION OF EMPLOYMENT - claim of UNLAWFUL TERMINATION - allegation that employee proffered an altered medical certificate - allegation held not made out on the EVIDENCE given ONUS OF PROOF - whether VALID REASON - whether the employee had an OPPORTUNITY TO RESPOND
Industrial Relations Act 1988 ss. 170DB, 170DC, 170DE, 170EDA, 170EE
CASES:
Selvachandran v Peteron Plastics Pty Ltd (Industrial Relations Court of Australia, Northrop J, 7 July 1995)
Jones v Dunkel (1959) 101 CLR 298
Nicolson v Heaven & Earth Gallery Pty Ltd (1994) 1 IRCR 199
Gibson v Bosmac Pty Limited (Industrial Relations Court of Australia, Wilcox CJ, 5 May 1995)
Johns v Gunns Limited (Industrial Relations Court of Australlia, Northrop J, 18 May 1995)
Liddell v Lembke (1994) 127 ALR 342
SAM BENJAMIN CARUANA & ALHMU v COURTAULDS (AUSTRALIA) PTY LTD
No. VI 2046 of 1995
Before: Judicial Registrar Murphy
Place: Melbourne
Date: 26 July 1995
INDUSTRIAL RELATIONS COURT
OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
VI 2046 of 1995
B E T W E E N :
SAM BENJAMIN CARUANA & ALHMU
Applicants
AND
COURTAULDS (AUSTRALIA) PTY LTD
Respondent
MINUTES OF ORDERS
Judicial Registrar Murphy 26 July 1995
THE COURT ORDERS:
That the applicant be reinstated by the respondent to the position in which he was employed immediately prior to the termination;
The reinstatement be effective from the date of this order;
The respondent pay to the applicant the amount of remuneration lost by the applicant as a result of the termination after taking into account the amounts he has received by way of WorkCover payments;
That the period between the date of termination and the date of reinstatement be treated as continuous employment of the applicant by the respondent for all purposes;
That the time for payment be 21 days from the date of this order.
NOTE: Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules.
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