Schmidt v Boral Fused Materials Pty Ltd

[2016] FWC 2575

[2016] FWC 2575

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.365—General protections

Dean Schmidt
v
Doral Fused Materials Pty Ltd
(C2015/5630)

DEPUTY PRESIDENT KOVACIC CANBERRA, 22 APRIL 2016

Application to deal with contraventions involving dismissal – extension of time – exceptional circumstances warranting allowing a further period for the making of an application – period for making the application extended to 10 August 2015.

[1] Mr Dean Schmidt (the Applicant) made an application which was received by the Fair Work Commission (the Commission) on 10 August 2015 under s.365 of the Fair Work Act 2009 (the Act) alleging that he had been dismissed by Doral Fused Materials Pty Ltd (Doral – the Respondent) on 14 July 2015 in contravention of the general protections provisions in the Act.

[2] On 17 August 2015, Doral in its Form F8A – Response to General Protections Application raised a jurisdictional objection on the basis that the application had been lodged six days outside the 21 day statutory timeframe specified in s.366(1) of the Act. The Commission subsequently issued Directions on 1 September 2015 requiring the parties to file an outline of submissions and any evidentiary material they intended to rely on regarding the extension of time issue.

[3] The application was the subject of a telephone hearing on the extension of time issue on 2 October 2015. At the telephone hearing Ms Vicki Mountain appeared with permission for Mr Schmidt, while Mr Sam Witton appeared with permission for Doral. Ms Janet West, a Law Clerk with Mountains Lawyers Pty Ltd, provided a witness statement 1 on behalf of Mr Schmidt. Ms West was not required for cross examination.

[4] For the reasons set out below I have concluded that I am satisfied that there were exceptional circumstances warranting an extension of time and extend the timeframe for lodging the application to 10 August 2015.

Background

[5] Doral is an integrated zirconium producer which carries out downstream processing operations at its processing plant in Kwinana, Western Australia.

[6] On 24 May 2015 Mr Schmidt suffered serious injuries in a workplace accident and subsequently lodged a workers’ compensation claim which was accepted.

[7] Mr Schmidt was dismissed on 14 July 2015. The termination letter sent to Mr Schmidt states:

“Dear Dean

Confidential

Notice of termination of employment

The purpose of this letter is to notify you of our decision to terminate your employment with Doral Fused Materials Pty Ltd (Doral) effective 14 July 2015 with payment in lieu of 4 weeks’ notice.

The reason for this decision is your repeated failure to apply proper isolations prior to undertaking work as is required by Isolation and Tagging of Plant & Equipment procedure DFM-SP-7.5. This conduct has been discussed with you on a number of occasions and you have been issued with 2 prior final written warnings.”

[8] On 3 August 2015 Mr Schmidt made an application under s.773 of the Act alleging that he had been unlawfully terminated by Doral 2. The application was made within the 21 day timeframe specified in s.774(1)(a) of the Act.

[9] On 5 August 2015, Doral’s solicitors wrote to Mr Schmidt’s solicitors advising that in accordance with s.723 of the Act Mr Schmidt did not have standing to bring an unlawful termination application because he was a national system employee and was therefore entitled to bring a general protections claim. On that basis, Doral invited Mr Schmidt to withdraw his term unlawful termination application.

[10] On 7 August 2015, Mr Schmidt’s solicitors responded to the above letter stating that Mr Schmidt would be withdrawing his unlawful termination application on 10 August 2015 and would simultaneously lodge a general protections application.

[11] On 10 August 2015, Mr Schmidt discontinued his unlawful termination application and later that day lodged his general protections application. As noted above, Mr Schmidt’s general protections application was received by the Commission six days outside the 21-day statutory timeframe for lodgement specified in s.366(1)(a) of the Act. In his application, Mr Schmidt contended that he was dismissed in contravention of ss.340, 351 and 352 of the Act which respectively deal with protection concerning the exercise or non-exercise of a workplace right, discrimination and temporary absence due to illness or injury.

The Relevant Legislation

[12] Section 366 of the Act provides:

“366 Time for application

366(1) An application under section 365 must be made:

(a) within 21 days after the dismissal took effect; or
(b) within such further period as the FWC allows under subsection (2).

366(2) The FWC may allow a further period if the FWC is satisfied that there are exceptional circumstances, taking into account:

(a) the reason for the delay; and
(b) any action taken by the person to dispute the dismissal; and
(c) prejudice to the employer (including prejudice caused by the delay); and
(d) the merits of the application; and
(e) fairness as between the person and other persons in a like position.”

Whether to allow a further period for the application to be made

[13] In deciding whether to allow a further period for an application to be made the Commission must take into account the matters set out in s.366(2) above. I will deal with each of those matters separately.

(a) The reason for the delay

[14] Mr Schmidt submitted that the delay in lodging his general protections application was not occasioned by his conduct, adding that he was blameless in respect of the delay in lodging his application. More specifically, Mr Schmidt contended that he relied entirely on his solicitor’s professional qualifications to look after the lodging of his application. In short, Mr Schmidt cited representative error as the reason for the delay and relied on the decisions in Clark v Ringwood Private Hospital (Clark) 3and Robinson v Interstate Transport Pty Ltd4 (Robinson). Mr Schmidt also submitted that while he first contacted his solicitors on 8 July 2015, i.e. before his dismissal, that following his dismissal he was unable to meet with his solicitors until 24 July 2015 as a result of his solicitors moving offices and upgrading their computer systems.

[15] Ms West deposed in her witness statement, inter alia, that:

“The error in relation to filing of the wrong claim was a mistake by Mountains Lawyers, caused in part by the unusual circumstances of time constraints, relocating Mountains Lawyers office premises, and inability to access software and computers to conduct research and attend to review and settling of documents by our usual procedures. Mr Schmidt was entirely blameless in deciding which claim to bring in the Fair Work Commission for relief against the termination of his employment.” 5

[16] At the telephone hearing, with regard to Doral’s submission that Mr Schmidt had failed to explain the reason for the delay in lodging his application from 5 August 2015 when his representative was advised that he had lodged an incorrect application until 10 August 2015 when his general protections application was lodged, Mr Schmidt provided a number of reasons for the delay. They included that:

• the advice from Doral’s solicitors regarding the incorrect application was not provided until late on 5 August 2015 and, as such, was not brought to the attention of his solicitor until the following day;



• his solicitors needed to seek his instructions, with this not occurring until the afternoon of 7 August 2015;



• his solicitors had to notify their professional indemnity insurers; and



• his general protections application was drafted on the afternoon of 7 August 2015, with 10 August 2015 being the first opportunity his solicitors had to file the application.

[17] Doral contended that an extension of time should not be granted in this case for two key reasons. The first being that Mr Schmidt responded yes to Question 7 of the Form F9 – Application for the Commission to Deal With an Unlawful Termination Dispute which asks:

“Section 723 provides that a person must not make an unlawful termination application in relation to conduct if the person is able to make a general protections court application in relation to the conduct (see Division 8 of Part 3-1). Do you consider that you cannot make a general protections court application?”

[18] Specifically, Doral contended that the filing of an unlawful termination application in error in circumstances where a positive declaration had been made that the applicant cannot commence a general protections claim should not be considered to constitute an exceptional circumstance justifying an extension of time. Doral also highlighted in its submissions that the grounds on which Mr Schmidt’s general protections application were based were significantly broader than those relied upon in his unlawful termination application.

[19] The second reason cited by Doral, relying on the Full Bench decision in in Cheval Properties Pty Ltd (t/as Penrith Hotel Motel) v Smithers 6, was that Mr Schmidt had not provided a credible reason for the whole of the period that his application was delayed. In this regard, Doral highlighted that its solicitors had advised Mr Schmidt’s representative on 5 August 2015 that he had erroneously filed an unlawful termination application yet his general protections application was not lodged until 10 August 2015.

[20] At the telephone hearing, Doral relied on its written submissions, emphasising in particular that the entire delay had not been explained by Mr Schmidt.

[21] As noted by a Full Bench in Robinson v Interstate Transport Pty Ltd 7 (Robinson) the approach to representative error as an explanation for late lodgement was first set out in Clark v Ringwood Private Hospital (Clark)8in the context of a discretion to extend under s.170CE(8) of the Workplace Relations Act 1996 (the WR Act) followed by a Full Bench decision in Davidson v Aboriginal & Islander Child Care Agency (Davidson).9

[22] The approach in Clark was summarised in Davidson as follows:

“In Clark the Commission decided that the following general propositions should be taken into account in determining whether or not representative error constitutes an acceptable explanation for delay:

(i) Depending on the particular circumstances, representative error may be a sufficient reason to extend the time within which an application for relief is to be lodged.

(ii) A distinction should be drawn between delay properly apportioned to an applicant’s representative where the applicant is blameless and delay occasioned by the conduct of the applicant.

(iii) The conduct of the applicant is a central consideration in deciding whether representative error provides an acceptable explanation for the delay in filing the application. For example it would generally not be unfair to refuse to accept an application which is some months out of time in circumstances where the applicant left the matter in the hands of their representative and took no steps to inquire as to the status of their claim. A different situation exists where an applicant gives clear instructions to their representative to lodge an application and the representative fails to carry out those instructions, through no fault of the applicant and despite the applicant’s efforts to ensure that the claim is lodged.

(iv) Error by an applicant’s representatives is only one of a number of factors to be considered in deciding whether or not an out of time application should be accepted.” 10 (Underlining added)

[23] Ms West’s evidence, which was unchallenged, clearly stated that Mr Schmidt was entirely blameless in deciding to initially lodge an unlawful termination application as opposed to a general protections application. As to the reason for the delay between 5 and 10 August 2015, based on the material before the Commission it is clear that Mr Schmidt instructed his solicitors on the afternoon of 7 August 2015 to lodge his general protections application. While his application was not lodged until 10 August 2015, I am satisfied that this was not as a result of Mr Schmidt’s actions but rather due to what might best be described as tardiness on the part of his solicitors. In those circumstances, I do not consider that Mr Schmidt should be penalised for the performance of his representatives.

[24] As to Mr Schmidt’s reliance on the dislocation caused by his solicitors moving offices in the immediate aftermath of his dismissal, I note that the relocation did not preclude his unlawful termination application being lodged within the 21-day timeframe. As such, I do not consider that the relocation can be relied upon by Mr Schmidt as a reason for the delay in lodging his general protections application.

[25] Finally, I note that Senior Deputy President O’Callaghan in Mr Gery Lane v Kangaroo Island Dive & Adventures Pty Ltd 11 granted an extension of time in circumstances where the applicant in that case had made an application within the statutory timeframe but using the incorrect application form, with that error only detected when the matter was the subject of a conference convened by the Senior Deputy President.

[26] The above analysis points to the existence of exceptional circumstances.

(b) Any action taken by the person to dispute the dismissal

[27] Mr Schmidt submitted that he first disputed his proposed dismissal before it occurred by declining to accept the various departure and release letters put to him by Doral. Mr Schmidt further submitted that he contacted his solicitors the day after his termination to seek advice regarding his dismissal.

[28] Doral submitted that while it became aware that Mr Schmidt was disputing his dismissal when it received his unlawful termination application, he significantly expanded the grounds on which his dispute was based in his general protections application. Doral also submitted that Mr Schmidt was aware that his employment was to be terminated and that he actively engaged with the process to negotiate the terms of a mutually agreed separation by suggesting additional payments for retraining as well as other increases to the terms of the separation.

[29] Mr Schmidt clearly disputed his dismissal when he lodged his unlawful termination application with the Commission on 3 August 2015, which as previously noted was within the 21 day timeframe. This points to the existence of exceptional circumstances.

(c) Prejudice to the employer (including prejudice caused by the delay)

[30] Mr Schmidt contended that Doral would not be prejudiced were an extension of time granted in this case, other than the usual inconvenience associated with being required to defend an application. As such, Mr Schmidt submitted that the issue of prejudice was, at best, a neutral consideration.

[31] Doral contended that it would suffer prejudice should the Commission grant an extension of time in this case but did not elaborate in its submissions as to how it would be prejudiced.

[32] Against that background, I consider the issue of prejudice to be a neutral consideration.

(d) The merits of the application

[33] Mr Schmidt submitted that he has an arguable case against Doral for adversely affecting his employment in breach of the general protections provisions of the Act.

[34] At the telephone hearing, Mr Schmidt contended that his application had strong prospects of success. Mr Schmidt also submitted at the telephone hearing that:

• he had been dismissed for breaching a procedure of which he had no knowledge;



• the warnings issued to him in 2011 and 2012 were for different reasons, adding that under Doral’s Disciplinary Guidelines those warnings expired after six months;



• he had an exemplary safety record;



• there were no witnesses to the incident of 24 May 2015 in which he was injured;



• the Western Australian Department of Mines and Petroleum was investigating the incident, adding that until that report is finalised he did not know what happened on the day.

[35] Doral contended that the only reason for Mr Schmidt’s dismissal was his serious and repeated breaches of its Isolation Procedure, which exposed both himself and his colleagues to an unacceptable risk of harm. Doral further contended that its investigation into the events of the 24 May 2015 included interviewing Mr Schmidt and concluded that he had failed to apply the correct isolations and locks to the descaler, as is required under its Isolation Procedure. Doral also highlighted that Mr Schmidt had previously received two final warnings for failing to comply with its Isolation Procedure. Against that background, Doral contended that it was clear that a prohibited reason was not the reason and formed no part of the reason to terminate Mr Schmidt’s employment. Doral submitted that Mr Schmidt’s application therefore had no merit or reasonable prospects of success and that an extension of time was therefore not justified in this case.

[36] At the telephone hearing, Doral submitted that Mr Schmidt’s application had very little prospect of success as there was no evidence that the decision maker took into account any prohibited matters under the Act in deciding to terminate his employment.

[37] As can be seen from the above, some key issues in this matter are disputed. In those circumstances and in the absence of a substantive hearing of the evidence in this case, I am unable to form considered view as to the merits of Mr Schmidt’s application. I therefore consider this factor to be a neutral consideration.

(e) Fairness as between the person and other persons in a like position

[38] Mr Schmidt did not address this factor in his submissions.

[39] Doral did not directly address this factor in its submissions, though it did address the issues of fairness between the parties. Specifically, Doral submitted that, will in the interests of fairness between the parties, the application should be dismissed as being out of time.

[40] In the absence of any submissions directly addressing this factor, I consider it to be a neutral consideration.

Conclusion

[41] The question of exceptional circumstances was dealt with by a Full Bench of the then Fair Work Australia in the decision of Cheyne Leanne Nulty v Blue Star Group 12(Nulty) in the following way:

“[13] In summary, the expression “exceptional circumstances” has its ordinary meaning and requires consideration of all the circumstances. To be exceptional, circumstances must be out of the ordinary course, or unusual, or special, or uncommon but need not be unique, or unprecedented, or very rare. Circumstances will not be exceptional if they are regularly, or routinely, or normally encountered. Exceptional circumstances can include a single exceptional matter, a combination of exceptional factors or a combination of ordinary factors which, although individually of no particular significance, when taken together are seen as exceptional. It is not correct to construe “exceptional circumstances” as being only some unexpected occurrence, although frequently it will be. Nor is it correct to construe the plural “circumstances” as if it were only a singular occurrence, even though it can be a one off situation. The ordinary and natural meaning of “exceptional circumstances” includes a combination of factors which, when viewed together, may reasonably be seen as producing a situation which is out of the ordinary course, unusual, special or uncommon.”

[42] Having considered all of the factors set out in s.366(2) and drawing on Nulty, I am satisfied that there are exceptional circumstances warranting the granting of a further period for the making of an application under s.366(2).

[43] The timeframe for lodging the application is extended to 10 August 2015. An order to that effect will be issued with this decision. Mr Schmidt’s application will now be listed for a conference aimed at resolving the dispute.

Appearances:

V. Mountain for the Applicant.

S. Witton for the Respondent.

Hearing details:

2015.

Canberra and Perth (telephone hearing):

October 2.

 1   Exhibit M1

 2   C2015/5023

 3 (1997) 74 IR 413

 4 (2011) 211 IR 347

 5   Exhibit M1 at paragraph 16

 6 (2010) 197 IR 403 at 408-409

 7 (2011) 211 IR 347

 8 (1997) 74 IR 413

 9 (1998) 105 IR 1

 10   Ibid

 11   [2010] FWA 3939

 12   [2011] FWAFB 975

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