Shackley v Australian Croatian Club Limited

[1995] IRCA 86

CATCHWORDS

Termination of employment- reason related to race- need for employee to have opportunity to defend against allegations relating to conduct or performance.

Industrial Relations Act, 1988 Sections 170 DC, 170 DF (f), 170 EA, 170 EE(2) &(3)(a)

SHACKLEY V. AUSTRALIAN CROATIAN CLUB LIMITED

AI 0136 of 1994

LINKENBAGH J.R.
CANBERRA

27 FEBRUARY, 1995

INDUSTRIAL RELATIONS

COURT OF AUSTRALIA

AT CANBERRA  No AI 0136 of 1994

Between        JANICE ROBYN SHACKLEY
  Applicant

and           AUSTRALIAN CROATIAN CLUB LIMITED
  Respondent

REASONS FOR JUDGMENT EDITED FROM EXTRACT OF TRANSCRIPT OF PROCEEDINGS

JUDICIAL REGISTRAR LINKENBAGH

CANBERRA

DATE OF JUDGMENT: MONDAY, 27 FEBRUARY 1995

This is an application under section 170EA of the Industrial Relations Act 1988, brought by the applicant against the Australian Croatian Club Limited. The club is a company limited by guarantee and it is formed for purposes, amongst other things, of promoting relations between the Croatian community and the community at large and to promote the Croatian culture. There is no doubt that the respondent is an organisation with the most worthy basis for existing and the most worthy intentions. Nevertheless, the club is in the business of conducting a commercial enterprise, being a licensed club premises where liquor is sold and where patrons have the opportunity to engage in legal gambling.

In the course of its business, the respondent employed the applicant as its Secretary/Manager and employed her on terms set out in letter of employment dated 24 January 1994.  It was a term of the employment that there be a probationary period of three months, expiring on 27 April, and the applicant worked for that period.  At the end of that period, there was nothing said to her at all about her performance not being satisfactory and she continued on in full time employment.  On 17 May 1994, she was informed, on her evidence, by the President of the club that she would have to leave and when she inquired as to the reason for that, he said that the committee said she had to leave, and that the real reason for her dismissal was that she was not a person of Croatian descent.  The President, Mr Bagic, denies that conversation and his evidence is that the conversation was to the effect that the club had tried to help the applicant as much as they could and had warned her many times and that they had decided not to keep her employed and were giving her 14 days notice.There is a direct clash between the two main witnesses as to the terms of that conversation.

I find on the balance of probabilities and on weighing up the credit of the two witnesses - the applicant and Mr Bagic - as they impressed me at the hearing, that I prefer the evidence of the applicant.  My conclusion in that regard comes not only from weighing the evidence in relation to that particular conversation, but arises from the overall demeanour of both the witnesses, and the detail with which they gave their evidence.  My conclusion as to the greater credibility of the applicant's version of that conversation also comes from looking at the surrounding circumstances in relation to the period of employment.  Firstly, there was the probation period.  If Mr Bagic's version of the termination conversation was accurate, it would have been reasonable to expect that something would have been said by the club at the conclusion of the probation period.  In fact, nothing was said.

Another factor is, that on termination the club gave the applicant what can only be described as a glowing reference.  Because of language difficulties, the reference was composed by the applicant and was signed by Mr Bagic as President of the club.  Mr Bagic requested the applicant to compose the reference, and he gave evidence that he read it and that he signed it.  He said in evidence, that it was not the truth, but nonetheless, on the day, he did not require any amendment to the reference and he signed it.  The reference speaks of the applicant attending to her duties in an "efficient and conscientious manner", and it describes her as a "punctual, polite and enthusiastic worker."  The terms of that reference do not sit comfortably with Mr Bagic's evidence at the hearing as to the shortcomings in the applicant's performance during her period of service with the club.

Another factor which is relevant in weighing up the credibility of the versions of the facts given by both parties, is a request, by the Club to the applicant, for her to return to her position in August of 1994.  If in fact, her performance was as poor as Mr Bagic told the Court that it had been, it is impossible to believe that the club would have requested that she return to the position of Secretary/Manager of the Club three months after she had left it.

Again, another factor which has some bearing on the determination of the matter, is that the applicant was in fact, replaced on the next day as Secretary/Manager by a woman of Croatian descent.  She was a person who, in Mr Bagic's evidence, was considered for the job in January 1994 at the time when the applicant obtained the position. Mr Bagic's initial evidence, which he attempted to retract, was that in January she was thought to be not able to handle the job and had no managerial experience, and was not good enough.  Yet, by May the club employed her to replace the applicant.

The respondent faces breaches of two sections of the act on the evidence, as I find it.  The first of those sections is section 170DC, which requires the employer not to terminate any employee's employment for reasons related to conduct or

performance, unless the employee has been given the opportunity to defend herself against the allegations made.  There was some attempt in the evidence put for the prespondent, to show that that section had been complied with.

The comments made by Wilcox CJ of this Court in Nicholson v Heaven and Earth Gallery Pty. Limited (1994) 126 ALR 233 leave no doubt, in my view, that the evidence in this case falls short of the standard required by Section 170 DC, and I find the respondent in breach of that Section.

I also find that the respondent is in breach of 170DF(f), in that I find that the employer terminated the employment for a reason relating to race.  I make that finding with some hesitation as I appreciate the consequences which will flow in that finding for the respondent.  Nevertheless, having found that I accept the applicant's evidence as to the termination conversation, and being met with a denial of her version of the conversation by the witness for the respondent, it flows from those findings that there is a breach of 170 DF(f).

I then turn to the question of compensation under section 170EE(2) of the Act.  There is no question that reinstatement in the circumstances of this case is impractical, and I make a finding in that regard.  I make that finding based not just the facts as I have found them in this judgment, but also on the facts relevant to the applicant. Impracticality of reinstatement relates to both the interests of the employer and of the employee.  I find that the applicant has obtained other employment which is at a higher salary in which she is very happy, and it would be totally impractical for her to be only afforded the remedy of this court, of reinstatement into a position which she would not want, and would not be in her interests.

The maximum which is payable pursuant to section 170 EE (3)(a) of the Act is 26 weeks at the usual remuneration, which is $467.33 per week. The applicant was actually unemployed for 24 weeks and three days, and whilst the period of unemployment is not necessarily in all cases the only consideration to be applied in determining the appropriate amount of compensation in the exercise of the court's discretion, it is a major factor in my determination in this matter today. Mr Collaery for the respondent argued, in effect, that there was no evidence that the applicant had attempted to mitigate her loss. Equally there was no cross-examination about that and there was no contrary evidence put on the question of compensation.

Whether or not there had been is irrelevant, because ultimately the amount of compensation is in the discretion of the court.  For all of these reasons I make the following Orders:

(1) That the termination of the employment of the applicant by the respondent contravened Division 3 of Part VIA of the Industrial Relations Act 1988, and

(2) That the respondent pay to the applicant within 14 days of today's date, by way of compensation pursuant to section 170 EE(2) of the Industrial Relations Act, 1988 the sum of $11,500.

I certify that this and the preceding three pages are a true copy of the Reasons for Judgment of the Court.

Maria Linkenbagh
Judicial Registrar

Counsel for the Applicant:          Mr. P. Shiels Q.C.
Solicitors for the Applicant:       Scott Shiels and Glover

Solicitor for the Respondent:       Mr. B. Colleary
  Bernard Colleary and Associates