Sheldon v Donvale Christian College
[2022] FedCFamC2G 980
Federal Circuit AND FAMILY Court of Australia (DIVISION 2)
Sheldon v Donvale Christian College [2022] FedCFamC2G 980
File number: MLG 3393 of 2020 Judgment of: JUDGE RILEY Date of judgment: 24 November 2022 Catchwords: INDUSTRIAL LAW – fair work – adverse action consisting of dismissal – whether dismissal was for a prohibited reason – alleged breach of whistleblower provisions. Legislation: Corporations Act 2001 (Cth) ss.1317AA, 1317AAA, 1317AAB, 1317AAC, 1317AC
Fair Work Act 2009 (Cth) ss.340(1), 341(1), 342(1), 360, 361(1), 550
Cases cited: Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500; (2012) 290 ALR 647; (2012) 86 ALRJ 1044; (2012) 220 IR 445; [2012] HCA 32;
Environmental Group Ltd v Bowd (2019) 137 ACSR 352; (2019) 288 IR 396; [2019] FCA 951;
Quinlan v ERM Power Ltd (2021) 7 QR 377; (2021) 303 IR 200; [2021] QSC 35.
Division Division 2 General Federal Law Number of paragraphs: 126 Date of hearing: 17, 18, 19 October 2022 Place: Melbourne Counsel for the Applicant: James Hooper Solicitor for the Applicant: Macpherson Kelley Counsel for the Respondents: Jack Tracey Solicitor for the Respondents: Lander & Rogers ORDERS
MLG 3393 of 2020 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: MARGARET ELIZABETH SHELDON
ApplicantAND: DONVALE CHRISTIAN COLLEGE
(ACN 004 963 713)
First RespondentTIM ARGALL
Second RespondentSTEVE VENOUR
Third Respondent
order made by:
JUDGE RILEY
DATE OF ORDER:
24 November 2022
THE COURT ORDERS THAT:
1.The application filed on 18 September 2020, amended on 10 August 2021 and further amended on 14 October 2022 be dismissed.
Note: The form of the order is subject to the entry in the Court’s records.
Note: This copy of the Court’s Reasons for judgment may be subject to review to remedy minor typographical or grammatical errors (r 17.05(2)(g) Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth)), or to record a variation to the order pursuant to r 17.05 Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth).
REASONS FOR JUDGMENT
JUDGE RILEY:
introduction
This matter concerns an adverse action claim brought under the Fair Work Act 2009 (“the Act”) and a claim that the applicant was victimised under the whistleblower provisions of the Corporations Act 2001 (“the Corporations Act”).
The applicant (“Ms Sheldon”) was employed by the first respondent, Donvale Christian College (ACN 004 963 713) (“Donvale”), from 22 January 2020 to 26 June 2020. Donvale is an independent Christian school located in Donvale, Victoria, which caters for children from prep to year 12. Ms Sheldon was employed as the Secondary Student Support Coordinator. Basically, her role was to coordinate support for secondary students with disabilities. The second respondent (“Mr Argall”) is the Executive Principal of Donvale. The third respondent (“Mr Venour”) is the Assistant Principal and Head of Secondary College of Donvale.
On 24 June 2020, and with effect from 26 June 2020, Donvale dismissed Ms Sheldon during her probationary period. The dismissal decision was made by Mr Argall and Mr Venour. Ms Sheldon claimed that they were both involved, within the meaning of s.550 of the Act, in the decision to dismiss her. They did not dispute that.
Ms Sheldon said that, on 11 May 2020, she spoke to:
(a)Donvale’s business manager regarding the allocation of funding to Donvale through the Nationally Consistent Collection of Data on students with a disability program (“NCCD”); and
(b)Mr Venour regarding the accounting requirements in relation to the NCCD and her concern that Donvale would not pass an audit if one were conducted.
Ms Sheldon said that, on 2 June 2020, in her written response to matters raised in her probation review, she told Mr Venour about her concerns regarding the NCCD. Ms Sheldon said that, during her termination meeting on 24 June 2020, she again raised the issue of Donvale’s administration in relation to the NCCD.
Ms Sheldon argued that she was therefore a whistleblower in relation to Donvale’s funding arrangements under the NCCD. She said that her employment was terminated for the substantive reason that she made disclosures in connection with the NCCD funding issue. She said that the termination of her employment was therefore victimisation contrary to s.1317AC of the Corporations Act.
Ms Sheldon further argued that Donvale terminated her employment for reasons prohibited by the Act, namely, because:
(a)on 11 May 2020, 2 June 2020 and 24 June 2020 she made the whistleblower complaints;
(b)on 15 June 2020, she lodged a WorkCover claim for stress related to work, being stress that caused the left side of her jaw to lock up at 3.20pm on 5 June 2020 during a Microsoft Teams meeting with a colleague;
(c)she had the disability consisting of her locked up jaw; and
(d)she made complaints on 2 June 2020 in relation to her employment in her response to matters raised in her probation review as follows:
(i)Donvale and Mr Venour had excluded her from ongoing operational decision-making processes regarding students with disabilities;
(ii)the role descriptions of Donvale’s staff, including Ms Sheldon, had to be re-examined because Mr Venour had permitted other staff to undertake Ms Sheldon’s roles and responsibilities;
(iii)Donvale had not complied with the administrative requirements of the NCCD, and, more specifically, Donvale may not have been able to produce the required evidence for funding under the NCCD should an audit occur; and
(iv)she had suggested an action plan to address the problems Donvale was facing and she could not be held responsible for problems that existed prior to the commencement of her employment.
In her further amended Form 2 filed on 14 October 2022, Ms Sheldon made a number of other allegations. However, she formally withdrew them during closing submissions.
The respondents argued that Ms Sheldon could not succeed in her whistleblower claim. The respondents said that was because, in 2020, she did not have “reasonable grounds to suspect”, as required by s.1317AA(4) of the Corporations Act, that the NCCD information that she disclosed concerned misconduct or an improper state of affairs. Moreover, the respondents argued that Ms Sheldon’s claim, in paragraph 41 of her further amended Form 2, that the information she disclosed “represents a danger to … the financial system”, within the meaning of s.1317AA(5)(e) of the Corporations Act, could not succeed. The respondents said that was because the disclosed information had no bearing on the financial system, which must mean, in the respondents’ submission, the national or state-level financial system.
The respondents further argued that the termination of Ms Sheldon’s employment was solely due to her underperformance. In particular, the respondents argued that Ms Sheldon failed to prepare individual learning plans (“ILPs”) for year 9 students until 12 June 2020, even though they were requested on or around 30 January 2020. Moreover, the respondents argued that the ILPs provided by Ms Sheldon on 12 June 2020 were deficient in various ways. Consequently, the respondents argued that the adverse action they took against Ms Sheldon was not for a prohibited reason and therefore not in breach of the Act.
the RESPONDENTS’ summary of the facts
In their written submissions filed on 22 April 2021, the respondents provided the following relatively succinct summary of the relevant facts from their point of view, which is included simply as background:
6.On or around 14 November 2019, Ms Sheldon was offered employment at the College as a full-time Secondary Student Support Co-ordinator to commence on 22 January 2020. Ms Sheldon’s contract of employment stipulated that continuing employment was subject to performance and conduct being satisfactory during the first six months of employment and that the College may terminate Ms Sheldon’s employment at the end of that period.
7.As a Secondary Student Support Co-ordinator, Ms Sheldon was responsible for providing support to secondary school students with individual learning needs. Two key aspects of Ms Sheldon’s role, recorded in her position description, were:
(a)the development of Individual Learning Plans (ILPs), which is a written statement that outlines adjustments, goals and strategies to meet a student’s individual educational needs; and
(b)collaborating with other staff, including participating in fortnightly meetings with year level co-ordinators concerning general student behaviour, activities and wellbeing.
8.In December 2019, Ms Sheldon completed a handover with Ros Butcher, the previous Secondary Student Support Co-ordinator, who was retiring.
9.On 22 January 2020, Ms Sheldon commenced in her role.
10.Within the first few weeks of her employment, Mr Venour observed a number of issues relating to Ms Sheldon’s approach to the role. In particular, in relation to the development of ILPs and her approach to other staff. These were raised with Ms Sheldon during a meeting she had with Mr Venour on 11 February 2020.
11.During the period February to May 2020, Mr Venour continued to observe, and receive feedback, that Ms Sheldon was performing below the standard expected of her position.
12.As a result, and in accordance with the College’s probationary process, Mr Venour held a probationary meeting with Ms Sheldon (which was held over two days: 19 and 26 May 2020). During that meeting, Mr Venour outlined the details of the performance concerns. Ms Sheldon later received a written record of the meeting.
13.On 2 June 2020, a second probationary meeting was held with Ms Sheldon. During the meeting, Mr Venour outlined ongoing performance concerns.
14.Following the second probationary meeting, Mr Venour and Mr Argall discussed the decision of whether Ms Sheldon would pass her probationary period.
15.In or around mid-late June 2020, Mr Argall and Mr Venour jointly decided that Ms Sheldon would not pass her probationary period and that her employment would be terminated because of unsatisfactory performance during the probationary period. In particular, the decision was made because Ms Sheldon:
(a)did not respond to tasks and emails given to her within a reasonable timeframe. Of particular concern was Ms Sheldon’s continual failure to produce ILPs in a timely manner;
(b)did not communicate clearly with other staff and failed to foster key relationships with staff in leadership roles; and
(c)had failed to demonstrate progress in the role across the six months of her employment.
16.On 24 June 2020, Ms Sheldon was notified that the College had decided to terminate her employment effective from 26 June 2020 because of underperformance during the probationary period. Specifically, Mr Venour stated that Ms Sheldon had not responded to tasks and emails within a reasonable timeframe, that she did not communicate clearly with staff and that she had failed to demonstrate progress in the role across the six months of her employment.
17.As set out in the termination letter, Ms Sheldon was paid her outstanding entitlements on or around 29 June 2020.
(footnotes omitted)
The workcover claim
What that summary does not make clear is that, after the probationary meetings on 19 and 26 May and 2 June 2020, which were not particularly positive for Ms Sheldon, and before the termination decision was communicated to her on 24 June 2020, Ms Sheldon:
(a)reported to Mr Venour on 8 June 2020 that she had suffered a jaw injury during a Microsoft Teams meeting on 5 June 2020; and
(b)on 16 June 2020, lodged her WorkCover claim in respect her alleged injury.
WorkCover subsequently rejected the claim. However, Ms Sheldon, after her dismissal, brought an application in the Accident Compensation Conciliation Service. That matter was between Ms Sheldon and Donvale’s insurer. The matter was settled, without an admission of liability, on the basis that the insurer would pay some of Ms Sheldon’s medical expenses.
material RELIED upon
Ms Sheldon relied upon:
(a)her initiating application filed on 18 September 2020;
(b)her affidavit sworn on 11 December 2020;
(c)her affidavit sworn on 16 March 2021;
(d)her written submissions filed on 22 April 2021 (except paragraphs 3.11 to 3.20, 3.23 to 3.24, 3.25(a),(b) and (e), 4.7 to 4.16 and 4.26 to 4.28, which were formally withdrawn during closing submissions);
(e)her affidavit sworn on 24 August 2022;
(f)her affidavit sworn on 12 October 2022;
(g)the further amended Form 2 filed on 14 October 2022 (except paragraphs 3 to 22 inclusive of Part G, which were formally withdrawn during closing submissions); and
(h)the court book emailed to chambers on 19 October 2022 (with students’ names redacted).
The respondents relied upon:
(a)the affidavit of Jennifer van Garderen sworn on 16 February 2021;
(b)the affidavit of Tim Argall sworn on 16 February 2021;
(c)the affidavit of Steve Venour sworn on 11 March 2021;
(d)their written submissions filed on 22 April 2021 (except paragraphs 24 to 35, which became irrelevant when Ms Sheldon withdrew a number of her claims);
(e)the affidavit of Tim Argall sworn on 22 September 2021;
(f)the affidavit of Steve Venour sworn on 22 September 2021;
(g)the further amended response filed on 14 October 2022 (except paragraphs 3(c), 3(d), 4(a)(i), 4(a)(ii), 4(a)(iii) and 4(a)(iv), which became irrelevant when Ms Sheldon withdrew a number of her claims); and
(h)the court book emailed to chambers on 19 October 2022, with students’ names redacted.
the adverse action claim
Legislation
Subsection 340(1) of the Act provides as follows:
Protection
(1) A person must not take adverse action against another person:
(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.
Subsection 341(1) of the Act provides as follows:
Meaning of workplace right
(1) A person has a workplace right if the person:
…
(c) is able to make a complaint or inquiry:
…
(ii)if the person is an employee – in relation to his or her employment.
Subsection 342(1) of the Act provides that an employer takes adverse action against an employee if the employer dismisses the employee.
Section 360 of the Act provides that:
Multiple reasons for action
For the purposes of this Part, a person takes action for a particular reason if the reasons for the action include that reason.
Subsection 361(1) of the Act provides that:
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 that the action was, or is being, taken for that reason or with that intent, unless the person proves otherwise.
Significantly, s.361 of the Act creates a statutory presumption that adverse action was taken for a prohibited reason, but that presumption may be rebutted by evidence. Also significantly, s.360 of the Act recognises that there may be multiple reasons for a particular action. It is sufficient for an applicant to establish that any one of the reasons for the adverse action was a prohibited reason, provided that it was a substantial and operative reason.
Authorities
The leading case on adverse action is Board ofBendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500; (2012) 290 ALR 647; (2012) 86 ALJR 1044; (2012) 220 IR 445; [2012] HCA 32. In that case, French CJ and Crennan J said:
42.Determining why a defendant employer took adverse action against an employee involves consideration of the decision-maker’s “particular reason” for taking adverse action (s 361(1)), and consideration of the employee’s position as an officer or member of an industrial association and engagement in industrial activity (“union position and activity”) at the time the adverse action was taken (ss 342, 346(a), 346(b), 347 and 361(1)).
43.Clearly 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. 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.
44.There is no warrant to be derived from the text of the relevant provisions of the Fair Work Act for treating the statutory expression “because” in s 346, or the statutory presumption in s 361, as requiring only an objective enquiry into a defendant employer’s reason, including any unconscious reason, for taking adverse action. 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?”.
45.This question is one of fact, which must be answered in the light of all the facts established in the proceeding. Generally, it will be extremely difficult to displace the statutory presumption in s 361 if no direct testimony is given by the decision-maker acting on behalf of the employer. 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-make or because other objective facts are proven which contradict the decision-maker’s evidence. However, direct testimony from the decision-maker which is accepted as reliable is capable of discharging the burden upon an employer even though an employee may be an officer or member of an industrial association and engage in industrial activity.
(citations omitted)
Also in Barclay, Gummow and Hayne JJ said at [104]:
In light of the legislative history of s 346 and the intention of Parliament outlined above, the reasoning of Mason J in Bowling is to be applied to s 346. An employer contravenes s 346 if it can be said that engagement by the employee in an industrial activity [or other protected activity] comprised “a substantial and operative” reason, or reasons including the reason, for the employer’s action and that this action constitutes an “adverse action” within the meaning of s 342.
The reasons for the dismissal that were stated at the time
Ms Sheldon said at [175] of her affidavit sworn on 11 December 2020 that she had a meeting with Mr Argall and Mr Venour at about 12.30pm on 24 June 2020. Ms Sheldon said that Mr Argall told her at that meeting that Donvale had decided to terminate her employment based on unsatisfactory performance and fractured relationships with year level co-ordinators.
In his affidavit of 16 February 2021, Mr Venour said that, prior to the meeting on 24 June 2020, he prepared a script. He said he read aloud the first two paragraphs of the script during the meeting. Those paragraphs are as follows:
The purpose of a probation period is to determine whether both parties are happy with the suitability of the employee in their new role. In our last conversation you stated that you haven’t been happy, that the job is not what you expected and that you wouldn’t have chosen to take it if you knew what it would be like and that you feel you are being asked to work in ways that are not your usual approach. For our part I stated that we had concerns particularly around the timeliness and thoroughness of your follow‐through on agreed tasks and about clarity of communication. As well as some concerns around the current status of some key relationships. We flagged at the time that we would meet in around 4 weeks time as part of tis (sic) probation process.
We acknowledge that you have been trying hard and that there have been some wins along the way, but we believe that concerns raised previously remain as concerns. We don’t have enough confidence that in persevering things will improve sufficiently in your ability to carry out the role. and (sic) in fact, I think it more likely that if we continue to push forward it will generate more friction and further work for those involved – including yourself. As (sic) so to that end we have decided to end your employment with us now. And we are truly regretful that this is where we find ourselves.
In his affidavit of 16 February 2021, Mr Argall said that, prior to the meeting on 24 June 2020, he and Mr Venour had prepared a script, which guided the discussion during the meeting. He said that Mr Venour told Ms Sheldon that Donvale had decided to terminate her employment during her probationary period based on her underperformance, specifically:
(a)she did not respond to tasks and emails given to her within a reasonable timeframe;
(b)she did not communicate clearly with other staff; and
(c)she had failed to demonstrate progress in the role across the six months of her employment.
The letter dated 24 June 2020 advising Ms Sheldon that Donvale was terminating her employment stated that the termination was for reasons of her unsatisfactory performance. The letter also stated that the reasons had been discussed in more detail during a meeting earlier that day between Ms Sheldon, Mr Argall and Mr Venour.
Ms Sheldon did not suggest that the summary set out above of the reasons for her dismissal given at the time of her dismissal was not accurate. However, her case was that the reasons for her dismissal stated at the time were not the true reasons.
The reasons for dismissal given by Mr Argall in his affidavits
Mr Argall said in his affidavit sworn on 16 February 2021 at [68] that the sole basis on which it was decided to terminate Ms Sheldon’s employment was that Donvale had lost confidence in her ability to perform her role, particularly due to:
Her failure to produce work in a reasonable period and her unwillingness to develop close relationships with students and staff.
In that affidavit, beginning at [35], Mr Argall described various aspects of Ms Sheldon’s underperformance and described his discussions with Mr Venour about Mr Venour’s efforts to help Ms Sheldon reach a satisfactory level. In particular, Mr Argall said that:
(a)he met Mr Venour on 3 February 2020 for a regular catch-up, when Mr Venour told him that things were not working well with Ms Sheldon;
(b)he met Mr Venour on 18 February 2020, and Mr Venour told him that Ms Sheldon was:
technologically slow and frequently failed to respond to emails or produce work that was expected within a reasonable timeframe;
(c)Mr Venour was spending a lot of time with Ms Sheldon to help her “get some wins” and support her; and
(d)after a few weeks in the position, Ms Sheldon:
was not doing the tasks that were expected of her and … was failing to communicate openly and effectively with other staff.
Mr Argall said further in his affidavit of 16 February 2021:
Ongoing performance issues
45.From the commencement of Ms Sheldon’s employment, one of the core ongoing components of her role was to create, manage and maintain Individual Learning Plans (ILPs) for students with learning needs and those who need help with classroom strategies, modifications and alterations. This was consistent with her position description.
46.During our regular Monday meetings, and at other times during the course of any given week when he visited my office, Mr Venour informed me that Ms Sheldon was very slow to produce ILPs and occasionally did not produce anything at all. Students with learning difficulties need plans to be able to learn (particularly remotely), and as an expert in student support, it was expected that Ms Sheldon would respond to this aspect of her role.
47.Further, DCC (as an education authority) has a statutory obligation under the Equal Opportunity Act 2010 (Vic) (Act), to make reasonable adjustments for students in certain circumstances. The creation, implementation, and management of ILPs is one of the core ways DCC ensures it satisfies this requirement. I was concerned that Ms Sheldon’s lack of timeliness in creating the ILPs, or in some circumstances her failure to produce them at all, would have put DCC at risk of breaching its obligations under the legislation if other staff members had not stepped in to assist.
48.Mr Venour was discussing these issues with Ms Sheldon during probationary meetings held with her on 19 May and 26 May 2020. ...
…
50.At or around 1 June, I heard from Mr Jonathon Price, Business Manager, that Ms Sheldon was criticising the Nationally Consistent Collection of Data (NCCD) auditing process, which collects information from schools on the numbers of students with disabilities and the adjustments they receive. I recall that she did not explain or evidence her criticisms - she just made it clear that she considered there was a problem.
51. Mr Venour and Mr Mike Halliday, Head of Senior School, informed me that Ms Sheldon would flag what she perceived to be a problem with a colleague and if anyone came to her for help, she would say, for example, that ‘it’s a problem with the NCCD’, or words to that effect.
52. As this was now several months into her employment, I considered that Ms Sheldon should have taken responsibility to address problems that she identified in the course of her duties, such as writing reports or sitting alongside staff responsible for developing programs for students to provide them with feedback.
Ms Sheldon’s unsatisfactory performance
53.On 2 June 2020, Ms Sheldon had a probationary meeting with Mr Venour and Mr Halliday.
54.After this meeting, I met with Mr Venour in which he debriefed me on the content and outcome of the meeting. Mr Venour told me that Ms Sheldon was still not delivering expected work and was not attending to urgent requests from year level coordinators. Mr Venour said that during the meeting Ms Sheldon said she would not have taken the job if she had known of the demands. At this point, I recall Mr Venour said ‘is there any hope here? How can things improve? We need to make a decision’. Whilst at this point in time I had serious concerns about Ms Sheldon’s capacity to fulfil the requirements of the Position, Mr Venour and I determined that we would give Ms Sheldon about a month to improve her performance following the feedback that Mr Venour gave her in the meeting.
…
56.On 10 June 2020, I met with Mr Venour, in which we discussed Ms Sheldon’s continuing underperformance, which Mr Venour said had not improved since her first probationary meeting. Again, we decided to give her additional time to improve following the feedback that she was given and a meeting that she had with Ms Nerilee Rinquist, Year 10 Coordinator, from which Ms Sheldon had action items to deliver in relation to contacting students’ families and devising strategies to pass on to teachers to assist in managing these students.
…
58.On 11 June 2020, I had a meeting with Mr Venour, Mr Price, and Ms van Garderen, in which we discussed Ms Sheldon’s continuing underperformance.
59. In this meeting, Mr Venour said that he felt that he had done everything he could to help Ms Sheldon in her role, but that she was still not fulfilling the requirements of the Position.
60. Mr Venour said that he and Mr Halliday had collected feedback from the year level coordinators about Ms Sheldon’s performance. Mr Venour said that the general feedback from the year level coordinators was that Ms Sheldon had essentially no contact with the Year 11 and 12 coordinators. This alarmed me because a key part of Ms Sheldon’s role is to work closely with the year level coordinators to ensure that secondary school students are well supported in the classroom. I was aware that a significant number of students, approximately 10 to 15% of students in the secondary school year levels, required the support of Mrs Butcher [Ms Sheldon’s predecessor] in some form before she retired. I was worried that Ms Sheldon’s lack of collaboration with year level coordinators was jeopardising students’ development.
61.Finally, I recall that we specifically discussed:
a.Ms Sheldon’s pre-existing health condition, which we had adjusted for in giving her an office next to the toilet and in relieving her from any requirement to undertake yard duty;
b.Ms Sheldon’s vulnerability to COVID-19, for which we had permitted her to work from home; and
c.a WorkCover claim that Ms Sheldon had made within the previous day in respect of a jaw injury that she claimed to have suffered while working from home.
62.I recall that we discussed Ms Sheldon’s pre-existing health conditions because we wanted to ensure that we were properly taking into account the potential impact of Ms Sheldon’s vulnerabilities on her performance, and to satisfy ourselves that we were supporting her with reasonable adjustments. We discussed Ms Sheldon’s WorkCover claim because I wanted to specifically separate it from our assessment of Ms Sheldon’s performance. Although we considered that none of these matters affected Ms Sheldon’s performance or suitability for the role, we decided to give Ms Sheldon additional time to improve and determined that we would make a decision about what to do in relation to her continuing employment at the end of the school term, which was towards the end of her probationary period.
…
64.On 18 June 2020, I met with Mr Venour, to further discuss Ms Sheldon’s performance in the Position. Ms Venour said that Ms Sheldon was not serving the community at DCC well, that she had failed to form good working relationships with staff and that she had not demonstrated any self-reflection in his discussions with her. Nonetheless, he said he was trying to look for a way forward and had collected additional feedback from the year level coordinators in the previous two days to assist in this process. I agreed that we could give Ms Sheldon more time to improve, and that Mr Venour should attempt to implement the feedback that he received before we made a final decision in relation to her ongoing employment.
…
66.On 22 June 2020, I met with Mr Venour to discuss Ms Sheldon’s underperformance and lack of progress in the Position. In particular, we discussed Ms Sheldon’s consistent failure to produce ILPs from February to May. ILPs are the ‘bread and butter’ of the Position and play an important role in DCC for the reasons outlined in paragraph 47 of this affidavit. There was no reason that Ms Sheldon could not produce them consistently as she was asked. Mr Venour’s said that his observation was that she was unwilling to complete the ILPs and sought to defer responsibility for doing so to others. Mr Venour stated that Ms Sheldon was distant in her relationships and had not connected with the kids and didn’t establish links with staff.
…
Decision to terminate employment
68.Based on the discussions I participated in in paragraphs 53 to 66 above, I was satisfied that Ms Sheldon had continually failed to produce the work that was requested and expected of her despite significant support from Mr Venour. Mr Venour and I decided that we would not continue Ms Sheldon’s employment beyond the probationary period as we had lost confidence in her ability to perform her role. In particular, her failure to produce work in a reasonable period and her unwillingness to develop close relationships with students and staff. This was the sole basis on which we decided to terminate her employment and I was satisfied that this was the appropriate outcome based on the evidence that Mr Venour presented to me in the course of our discussions.
Mr Argall exhibited to his affidavit his handwritten notes of his meetings with Mr Venour. The handwritten notes reflect Mr Argall’s narrative in his affidavit. The handwritten notes do not anywhere mention the NCCD program.
Following the filing of that affidavit, on 10 August 2021, Ms Sheldon filed her amended Form 2 which raised for the first time the whistleblower claim under s.1317AC of the Corporations Act. Previously, Ms Sheldon had only described the matters she had raised about NCCD funding as a complaint under the Act.
Mr Argall said in his affidavit sworn on 22 September 2021 that he understood from colleagues at other schools that, in 2020, all schools were grappling with the new documentation requirements for the NCCD. He said that he did not understand Ms Sheldon’s comments in 2020 about the NCCD to amount to an allegation of improper acquisition or allocation of funds. Rather, he said that he understood that Ms Sheldon was merely raising an operational matter about proper record keeping that staff at Donvale were working to remedy. Mr Argall said further that Ms Sheldon’s comments about the NCCD on 24 June 2020 played no part in the decision to terminate her employment, because the decision was made previously.
The cross-examination of Mr Argall
Mr Argall confirmed in cross-examination that Donvale received extra funding under the NCCD program from the federal government for children with special needs. He confirmed that Donvale was required by the NCCD program to have evidence that:
(a)each child for whom it received extra funding under the NCCD program actually had a special need;
(b)adjustments had to be made to accommodate each child’s special needs;
(c)the adjustments were made for at least 10 weeks;
(d)the child was monitored for adjustments made for them beyond 10 weeks; and
(e)Donvale collaborated with the child’s parents and health care providers.
Mr Argall confirmed that the federal government would audit schools in relation to their NCCD funding. He said that Donvale was audited in 2022 for its NCCD funding in the 2019 to 2021 years.
To her affidavit sworn on 12 October 2022, Ms Sheldon exhibited some documents she had obtained under subpoena from Donvale and pursuant to a notice to produce issued to Donvale. The respondents argued that the documents exhibited were irrelevant, because they could shed no light on what Ms Sheldon reasonably suspected at the time that she made her disclosures, because they did not exist at that time. However, I consider that the documents contained in the exhibited documents are relevant, because they tend to show that there was a proper foundation for what Ms Sheldon claimed to have suspected in May and June 2020.
In relation to the exhibited documents, Mr Argall said that:
(a)for the 2021 year, Donvale had 1,349 students, of whom 475 had a disability;
(b)of the 475 students with a disability, Donvale received NCCD funding for about half of them, because a lot of the disabilities were things like needing glasses, which did not attract any NCCD funding; and
(c)for the 2020 year, Donvale had 1,458 students, 506 of them had a disability and Donvale received funding for about half of them.
Amongst Ms Sheldon’s exhibited documents were an email dated 5 May 2022 from the auditor to people at Donvale (CB1248), and the spreadsheet alluded to in the email for the years 2019 to 2021. The email said:
From: Rachel Goodall <[email protected]>
Sent: Thursday, 5 May 2022 5:06 PM
To: Rebecca Mower
Cc: Chloe Tatti; Jon Price
Subject: 2403 - Donvale Day 2 NCCD QueriesAttachments: Day 2 - NCCD Queries.xlsx
Hi Beck,
As discussed, please see attached for the NCCD students missing information. A few notes below:
•The greyed out years aren’t applicable for that student and the yellow highlights represent where information is missing.
For example, for this student we requirement evidence of:
•adjustment provided for 2019
•monitor and review for 2020 and 2019
•consultation and collaboration for 2020 and 2019
[image of “disability test” table]
•Could you drop any evidence you find into SchoolBox for these students?
•I haven’t looked at approximately 138 students which I will do first thing on Tuesday next week and let you know if there is anything missing. Happy to provide this list as well.
•I have put some guidance in the first tab regarding what I’m looking for in each category.
If you have time after going through the missing information, it would be good if you and your team could also take a look at specifically NCCD students in Year 12 in 2019, 2020 and 2021. When I started looking at this students they seemed to have the least information.
Feel free to call me over the next few days if you have questions – my mobile is 0427 695 612. Thank you for your help!
Kind regards,
RachelThe spreadsheet is awash with yellow, indicating that a lot of evidence was missing as at 5 May 2022. However, the tone and wording of the email does not suggest that the auditor suspected Donvale of a fraud on the Commonwealth. Rather, the tone and wording of the email suggests that the auditor expected that Donvale would provide the missing evidence in the near future.
Mr Argall confirmed in cross-examination that the spreadsheet indicated that, for some children, half of the required information was missing. However, Mr Argall said that the spreadsheet was provided at the beginning of the audit, and Donvale subsequently provided the required information.
The auditor sent another email at 4.33pm on 10 May 2022 to Donvale (CB1267). The subject line was “Outstanding 2” and there was another spreadsheet attached. That spreadsheet was also awash with yellow.
Mr Argall said that, notwithstanding the two spreadsheets, the auditor had subsequently sent Donvale a “judgment” to the effect that five adjustments needed to be made to Donvale’s NCCD funding. Mr Argall said that Ms Sheldon had been provided with a copy of that “judgment” under subpoena, but she had chosen not to exhibit it to her affidavit. It was eventually provided to the court and became exhibit 2. The documents contained in exhibit 2 were created on 11 and 16 May 2022, about two years after Ms Sheldon made her disclosures.
The respondents argued that the documents contained in exhibit 2 were irrelevant, because they could shed no light on what Ms Sheldon reasonably suspected at the time that she made her disclosures, because they did not exist at that time. However, as discussed above, I consider that the documents contained in exhibit 2 are relevant, because they tend to show that there was a proper foundation for what Ms Sheldon claimed to have suspected in May and June 2020.
Exhibit 2 is four pages from the Department of Education, Skills and Employment. The documents in exhibit 2 were understood by both parties to have been produced in the context of an audit of Donvale’s claims for NCCD funding. Each page contains a table showing the numbers of students with an NCCD disability as originally claimed, the number of adjustments and the revised figures. Each page is signed by the auditor and Donvale’s business manager, showing that they reached agreement on the correct figures.
The first page concerns Donvale for 2019 and is dated 16 May 2022. It shows that, in relation to NCCD funding for 2019, Donvale originally said it had 527 students with a disability and that was revised down to 525. That is, Donvale overstated its disabled population in 2019 by two.
The second page concerns Donvale for 2020 and is dated 11 May 2022. It shows that, in relation to NCCD funding, Donvale originally said it had 506 students with a disability and that was revised down to 503. That is, Donvale overstated its disabled population in 2020 by three.
The third and fourth pages were for 2021, one for the main campus of Donvale and another for a separate smaller campus of Donvale. Those pages showed that originally, Donvale said it had, at both campuses, 528 students with a disability and that, following the audit, there were no adjustments from the original statements about the size of Donvale’s disabled population.
Therefore, for the three years of the audit, Donvale had originally overstated its disabled population by five out of 1,556. That works out to be an overstatement of about 0.33% for the three years of the audit, and about 0.5% for 2019 and 2020 combined. Mr Argall said that he expected that the school would be required to repay some money to the Commonwealth but it had not been asked to as yet.
Mr Argall said that the NCCD funding regime had commenced in 2019. He said that the previous holder of Ms Sheldon’s position had struggled with the documentation required and decided to retire at the end of 2019. Mr Argall confirmed that, under Ms Sheldon’s position description, one of her roles was to:
Facilitate the administration associated with NCCD (Secondary) …
Mr Argall agreed that it was part of Ms Sheldon’s responsibility to make sure that all of the evidence had been gathered to satisfy the requirements for NCCD funding for each student in respect of whom Donvale obtained NCCD funding.
Mr Argall was taken to an inconsistency in his affidavit evidence. At paragraph 50 of his first affidavit, he said that he had heard from the business manager that Ms Sheldon had criticised the NCCD auditing process. At paragraph 8 of his second affidavit, he said that he had heard from the business manager and Mr Venour that Ms Sheldon had raised concerns about the NCCD record keeping. Mr Argall eventually said that his evidence was that, around 1 June 2020, the business manager had told him that Ms Sheldon was concerned about Donvale’s NCCD record keeping. Mr Argall conceded that he had been aware by 1 June 2020 of Ms Sheldon’s concerns about Donvale’s NCCD record keeping, well before the decision to terminate her employment was communicated to her on 24 June 2020.
Mr Argall conceded that the business manager told him on around 1 June 2020 that Ms Sheldon was making enquiries about the amount of NCCD funding and where the details were stored at Donvale. He agreed that would have caused him concern. He said that he told Mr Venour to tell Ms Sheldon to focus on gathering the evidence necessary to satisfy the NCCD funding requirements, because that was her role. He agreed that, when he made the decision to terminate Ms Sheldon’s employment on 24 June 2020, he was aware that she had raised concerns about Donvale failing an NCCD audit. He agreed that, when he said at paragraph 9 of his second affidavit that he had already decided to terminate Ms Sheldon’s employment when she raised her concerns on 24 June 2020 about Donvale’s NCCD record keeping, he did not mean that Ms Sheldon had not raised those concerns earlier.
Mr Argall conceded that, on or about 1 or 2 June 2020, he was aware of Ms Sheldon’s written statement in response to her probation interview that:
Now that I have been able to access stored information related to support services at DCC and the data related to the NCCD, I have serious concerns about the school’s exposure to financial accountability for funds attracted through the NCCD system. The diagnosis, category allocation and evidence gathering systems are not consistent nor are the necessary adjustments for students with special needs appropriately implemented or evidenced by staff. The documentation for these processes is also not efficiently stored and therefore not easily accessible should an NCCD audit be conducted across the school I believe DCC will fall short.
As the only Special Education teacher in the Secondary School, I feel the responsibility for leadership during such an audit will fall to me and yet I [am] not empowered to make appropriate preparations for this process. ...
Mr Argall agreed that he had discussed this aspect of Ms Sheldon’s response to her probation interview with Mr Venour and the business manager on around 2 June 2020, and that this was only three weeks before he communicated to Ms Sheldon the decision to terminate her employment. However, he denied that he had decided, on around 2 June 2020, to terminate Ms Sheldon’s employment, and denied that he had decided on around 2 June 2020 that it was likely that he would terminate Ms Sheldon’s employment.
Mr Argall said that he considered Ms Sheldon’s claim that she felt “the responsibility for leadership” during an audit of Donvale’s NCCD funding would fall to her was misplaced, as he and the business manager would be the leaders during an audit.
Mr Argall said that his response to Ms Sheldon saying that Donvale might “fall short” in an audit of NCCD funding was to ask her to continue to obtain the required evidence, as that was her role.
It was put to Mr Argall that he must have considered Ms Sheldon’s written statement as falling under the school’s whistleblower policy. However, he did not concede that. He said that he considered that she had raised issues that he needed to look into.
Mr Argall did not accept that all the yellow in the auditor’s spreadsheets showed that Donvale’s NCCD records were in a parlous state. He said that the spreadsheets were working documents, and evidence was subsequently furnished.
Mr Argall agreed in cross-examination that he met Mr Venour on 2, 10, 11, 18 and 22 June 2020. Mr Argall denied that he discussed at those meetings Ms Sheldon’s claims that:
(a)Donvale would fail an NCCD audit;
(b)Donvale’s evidence keeping was inadequate in relation to diagnosis and category allocation;
(c)she felt responsibility for leadership in the event of an NCCD audit; or
(d)she wanted access to more information about NCCD funds and the allocation of those funds.
Mr Argall denied that he was worried that, if Ms Sheldon looked further into Donvale’s NCCD evidence-keeping, she would find that Donvale would fail an audit. He denied that one of the reasons for dismissing Ms Sheldon was that she had raised the NCCD issues. He conceded that he was aware that Ms Sheldon was asking for more resources to prepare for an NCCD audit, but he did not agree to provide them to her.
Mr Argall said that he did not consider Ms Sheldon’s statements about Donvale’s NCCD funding to fall within Donvale’s whistleblower policy.
It was put to Mr Argall in cross-examination (T:83:36) that an operative reason for him dismissing Ms Sheldon was that she had made a complaint about NCCD issues at Donvale. Mr Argall denied that. It was put to him (T:83:40) that a reason for Ms Sheldon’s dismissal was that she had made a complaint about the vulnerable position of Donvale should there be an audit of Donvale’s records. Mr Argall denied that. It was put to him (T:84:1) that a reason for the dismissal was that, if Ms Sheldon pursued the NCCD issues, Donvale may have to repay NCCD funding. Mr Argall denied that.
Mr Argall conceded that he was aware that Ms Sheldon made a WorkCover claim before 24 June 2020, being the day of termination. However, he denied that was the final straw in his decision to terminate her employment.
The HR manager’s evidence
Ms van Garderen was Donvale’s Human Resources Manager and Assistant Business Manager. She swore an affidavit on 16 February 2021 in which she said that:
(a)she attended the meeting on 11 June 2020 between Mr Argall, Mr Venour, the business manager and Ms Sheldon;
(b)Ms Sheldon was told during the meeting that she was not meeting the expectations of the role she had been employed to perform;
(c)Ms van Garderen was not aware of the decision to terminate Ms Sheldon’s employment until about 18 June 2020;
(d)on about 22 June 2020, Ms van Garderen assisted Mr Argall and Mr Venour with drafting the termination letter; and
(e)Mr Argall and Mr Venour told her that the reason for the termination was underperformance.
Ms van Garderen was cross-examined. She said that:
(a)she was not involved with NCCD funding work, but knew that evidence needed to be gathered to justify the receipt of NCCD funding;
(b)she was aware of the recent audit of Donvale in relation to NCCD funding but was not involved in it;
(c)none of Mr Argall, Mr Venour or the business manager discussed with Ms van Garderen whether Ms Sheldon’s statements in her probation response set out above should be dealt with under Donvale’s whistleblower policy;
(d)at her meeting with Mr Venour on 4 June 2020, she did not discuss with him that Ms Sheldon had raised issues about NCCD evidence collection and she did not know at the time that Ms Sheldon had raised those issues;
(e)at her meeting with Mr Argall, Mr Venour and the business manager on 11 June 2020, she did not discuss with them that Ms Sheldon had raised issues about the NCCD; and
(f)she did not know, at any time prior to the decision to terminate Ms Sheldon’s employment, that she had raised issues relating to NCCD funding.
Mr Venour’s affidavit evidence
Mr Venour noted in his affidavit sworn on 11 March 2021 that Ms Sheldon commenced at Donvale on 22 January 2020 and then said:
37.Within her first week or so of employment, I began to observe issues with Ms Sheldon’s approach to the Position. For example, she did not make any attempt to develop relationships or engage with the Year Level Co-ordinators. One other significant issue was the development of lndividual Leaming Plans (ILPs).
38. A key requirement of the Position, which is recorded in the position description, was to develop ILPs for students who require individual learning support. An ILP is a written statement that describes the adjustments, goals and strategies to meet a student’s individual educational needs so they can reach their full potential. An ILP is essential as it helps DCC plan and monitor a student’s unique learning needs.
39.From around 30 January 2020, Rachel Arsensis, Year 9 Coordinator, requested that Ms Sheldon develop ILPs for Year 9 students. From when these requests were first made until approximately May 2020, there were significant delays in the delivery of the ILPs. When they were ultimately produced in May 2020 they were not to a satisfactory standard. Year level coordinators told me that Ms Sheldon was slow to respond to emails in respect of the development of the ILPs and that they were not being prioritised and produced within a reasonable timeframe. Annexed to this affidavit and marked SV-6 is a bundle of emails from January 2020 until June 2020 from various staff and year level coordinators regarding Ms Sheldon’s performance issues, including with respect to delivering the ILPs, and how this impacted them and others.
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41.Another key issue that I observed early in her employment was Ms Sheldon’s distant approach to other staff and students. In or around the first week of Ms Sheldon’s employment, Ms Sheldon redesigned the HUB, which is a dedicated Learning Support area, comprising five rooms, for learning support staff and students. I did not consider that there was any need to change the HUB layout, as no other staff member had raised concerns regarding the space but allowed Ms Sheldon to make the changes she saw fit.
42.Specifically, Ms Sheldon redesigned the space to give herself a dedicated office, which required the relocation of two staff members that previously shared this office. I do not consider it was necessary for Ms Sheldon to have a dedicated office as any privacy concerns could have been overcome using a locked filing cabinet, which was utilised by her predecessor Ms Butcher. Ms Sheldon also redesigned the space to assign the HUB kitchen area as a student workspace and to encourage HUB staff to access facilities in the staff break room. Ms Sheldon regularly locked the door to her office and although the HUB had previously been a vibrant student friendly place, with the changes instituted by Ms Sheldon, the atmosphere became remarkably different.
43.Ms Sheldon also did not get involved with Year 7 prestart activities, which are a great way of meeting and engaging with new students to the Secondary School, nor did she make time to engage with Year 7 staff members, despite the invitation being extended to her. Ms Sheldon’s communication style was not warm or embracing and sent the signal that she was not approachable or willing to get to know her colleagues. It was a noticeably jarring contrast with the approach taken by Ms Butcher, who was very relationship focused and approachable in her interactions with students and staff.
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45.On or around 11 February 2020, I had a discussion with Ms Sheldon. During that discussion I raised a number of issues with her, including her need to develop closer working relationships with the year level co-ordinators, the prioritisation of outstanding ILPs and the use of the HUB. We agreed that Ms Sheldon would arrange one on one meetings with the year level coordinators and that she would use that opportunity to listen to their concerns, hopes and understandings and to talk through her plans for learning support and to explain the rationale for some of the changes that had been implemented.
Following their meeting on 11 February 2020, Mr Venour sent Ms Sheldon an email the same day, in which he summarised what they had discussed. In particular, he said at point 7:
We both recognise the importance of the handful of ILP’s – that they need to be sorted ASAP (any idea of the timeframe for that?)
Also in his affidavit sworn on 11 March 2021, Mr Venour said:
50.In the period February 2020 to May 2020, I had a number of regular one-on-one catch ups with Mr Argall where I provided general updates and raised any pressing issues. I cannot recall the exact dates of the meetings, but I recall that I raised Ms Sheldon’s progress and performance during these conversations. I said that Ms Sheldon was performing below the standard that we expected of her in the Position. Of particular concern was Ms Sheldon’s failure to build relationships with key stakeholders and the timely development of ILPs. I recall that Mr Argall took notes during these meetings.
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52.I was aware from my conversations with other staff members during Term 1, including Ms Sacristani, that Ms Sheldon was ‘missing’ emails. Specifically, she had not responded to or acknowledged several emails that had been sent to her. When approached by staff, Ms Sheldon claimed that this was because she had not received them. On one occasion, in or around February 2020, I informally raised this issue with Ms Sheldon. I forwarded to Ms Sheldon an email from a parent which had been sent to her but that she had not responded to. In this email, I offered to assist Ms Sheldon navigate her email system so this did not happen again. When we later searched together for this particular email in her inbox, we were able to locate it. Ms Sheldon acknowledged that she must have missed it.
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56.As described in paragraph 39 and 52 above, I received feedback from year level coordinators that Ms Sheldon was not replying to various emails that they had sent her and she was not producing ILPs within a reasonable timeframe ( or sometimes at all).
57.On 17 March 2020, in an informal catch-up, I asked Ms Sheldon to agree for Ms Karin Eleni us, Secondary Support, to have access to her emails so that Ms Elenius could support Ms Sheldon in managing her email communications. I asked Ms Elenius to help Ms Sheldon to triage emails. Ms Sheldon was initially receptive to this course of action, but later refused Ms Elenius’ help.
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76.On 26 April 2020, Ms Sheldon sent me an email with an attachment setting out ‘Needs Analysis of Individual Leaming Programs’, which she completed voluntarily and had not been asked to do so. I reviewed the document at around the time that I received it. The document set out long term objectives and goals regarding the development of ILPs. I did not respond by email, but in a conversation I had with her I explained that while we appreciated the work, we needed her to prioritise and actually produce the ILPs, which were long overdue.
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82.As noted above in paragraph 39, I received reports from various year level coordinators in March and April 2020 to the effect that they did not feel Ms Sheldon was assisting them adequately. I therefore decided to contact the year level coordinators for specific feedback and information to develop a better understanding of the reasons for their dissatisfaction ahead of Ms Sheldon’s probationary meeting.
83.From 11 May 2020 until on or around 18 June 2020, I collected feedback by meeting with various year level coordinators along with Mr Halliday. I directed Mr Halliday to approach the year level co-ordinators for feedback, and I also had one-on-one conversations with the Year 7, Year 8, Year 9 and Year 10 co-ordinators. In addition, I spoke to Ms Lauren Foster, Student Wellbeing Coordinator, and Ms Elenius. Mr Halliday summarised all of the feedback in a single document. I intended to use this document to provide constructive feedback to Ms Sheldon during her upcoming probationary period meeting scheduled for 19 May 2020.
84.Annexed to this affidavit and marked SV-14 is a copy of the summary prepared by Mr Halliday.
85.Overall, the feedback we received was that, instead of setting up ILPs and taking action to meet student needs, Ms Sheldon deferred to others and sought to pass off responsibility to them. The consequence of Ms Sheldon’s inaction in developing ILPs was that students were not getting the help and support that they needed. Despite the number of occasions on which we clarified the scope of the ILPs that were requested, Ms Sheldon consistently failed to submit them, a task that was well within the scope of her Position and one we had been requesting her to complete from her commencement.
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94.On 19 May 2020, I attended Ms Sheldon’s first probationary meeting with Mr Halliday. This meeting was split into two, as they went for around two hours each.
95.During the meeting, I covered a range of performance issues, including, amongst other things, the following two key issues:
a.Ms Sheldon needed to take more of a ‘lead role’ in carrying out the duties of the Position rather than act as a consultant. Ms Sheldon needed to liaise with parents, teachers and year level coordinators for approximately 10-15 students from each year level. Ms Sheldon’s predecessor had taken the lead in the care of such students and would proactively contact both parents and students to determine what support was required. We agreed that Ms Sheldon would take the lead with high needs learning support students and would take more of an “in the trenches” approach rather than an advisory or consultant approach. We also agreed that Ms Sheldon would work with staff to deliver the ILPs for identified year 9 students as soon as possible and, at least, by 12 June.
b.I reiterated that communication is key and asked Ms Sheldon to have more regular and quick communications with year level coordinators. I said that she needed to aim to respond within 24 hours. I said that as year level coordinators are under significant pressure at DCC, we cannot expect them to become case managers for students with learning support needs, which was the position that Ms Sheldon had placed them in by failing to respond to their emails. I said that Ms Sheldon could utilise Ms Elenius more to assist her with quick responses to year level coordinators and teachers.
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98.On 26 May 2020, I convened the second part of the first probationary meeting with Ms Sheldon and Mr Halliday. During the meeting we continued to discuss the performance issues we identified at the previous meeting and Ms Sheldon’s progress. We discussed the following, amongst other things:
a.I noted that Ms Sheldon had still failed to deliver the ILPs that we discussed at the previous meeting.
b. I reiterated the importance of quick and timely communications and noted some responses did not require a lengthy email response.
c.Mr Halliday asked Ms Sheldon if road blocks, such as knowing students and knowing where to find information, were now out of the way. Ms Sheldon confirmed that they were out of the way.
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102.On or around 27 May 2020, I provided a draft of Ms Sheldon’s formal probation meeting notes to Mr Argall.
103.On 29 May 2020, I emailed Ms Sheldon the notes we had taken from her probationary meetings for her to review and to add to or adjust any sections. I also provided clarification regarding the discussions she had planned with the year 9 teaching staff regarding the development of ILPs.
104.Later that day, Ms Sheldon responded to my email confirming her approach to the discussions with year 9 teaching staff. As outlined at paragraph 98 above, in the meeting on 26 May 2020, Ms Sheldon and I had discussed her delivery of the ILPs and her communication with staff about this issue. Given that the ILPs were still an issue at this time, in the meeting I had suggested that perhaps there had been a miscommunication between us about what she should be doing regarding her approach and provided her with explicit instructions on how this should be achieved. In her response, Ms Sheldon confirmed she understood what I and DCC required. Nevertheless, she subsequently failed to implement the agreed actions.
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106.On 2 June 2020, in advance of a further probationary meeting, Ms Sheldon emailed me attaching a copy of the notes from her first probationary meeting with additional comments. At this time, none of the matters raised by Ms Sheldon impacted my view of Ms Sheldon’s performance because:
a.in relation to her claims that she had been excluded from participating in training for operational technology platforms, I considered that Ms Sheldon had received significant support since her commencement of employment. Ms Sheldon had been provided with the initial induction and training schedules. Further, as described above, Ms Sheldon had obtained significant individual support from the IT department.
b.In relation to her claims that she was excluded from Microsoft Teams training, Ms Sheldon had received face to face training for distance learning on 23 March 2020.
c. In relation to her claims that she was not provided with the requisite knowledge and/or technology required for her to undertake the Position, Ms Sheldon had received the additional handover with Ms Butcher in December 2019 and the additional IT support mentioned above;
d.In relation to Ms Sheldon’s request to re-examine role descriptions of DCC staff and her claim that she had been excluded from ongoing operational decision-making, Ms Sheldon seemed to be suggesting that she should have been part of the secondary leadership team. Given Ms Sheldon had not demonstrated that she could perform her role to a satisfactory level, I did not think it would be suitable for her to be part of the secondary leadership team. Further, Ms Sheldon’s predecessor had had no involvement with the secondary leadership team, and I did not consider that it was necessary for her to perform her role.
e. In relation to Ms Sheldon’s comments about the Nationally Consistent Collection of Data on Students with Disability (NCCD), it was part of Ms Sheldon’s Position that she help compile NCCD data. Towards the end of Term 2, Ms Sheldon and I had a
telephonediscussion. During thattelephonediscussion, she expressed that she was concerned that she might not be able to pull all the data together. I reassured her that she should just do her best. I had told her that the responsibility ultimately falls to Mr Jonathon Price, Business Manager, and Mr Argall, and me. I said to her that if there were concerns or the data fell short, I reassured her that it would not be her fault. (The amendments were made in oral evidence.)f.In relation to Ms Sheldon’s claims that DCC had failed to transition the ILPs of approximately six students when they transitioned to the secondary school, which had resulted in a significant increase in her workload, I considered that this would not have added a significant workload. Ms Sheldon’s workload had been reduced from her predecessor as described above and she had been provided with significant coaching and support since her commencement.
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108.On 2 June 2020, I convened a second probationary meeting with Ms Sheldon and Mr Halliday. The meeting went for two and a half hours over Microsoft Teams.
109.In this meeting, I raised with Ms Sheldon that although Ms Sheldon seemed to be working hard, there continued to be frustration and a lack of outcomes. From my perspective, the main frustrations with respect to Ms Sheldon failing to meet expectations or follow up on agreed actions and next steps. The lack of outcomes was related to her failure to produce usable ILPs or take the lead with accommodating or assisting certain students with learning.
110.During the meeting Ms Sheldon said that she would not have come to DCC if she knew what was in store for her. I asked her where she was at and Ms Sheldon said that she did not feel she was doing her best but just doing what I had asked of her with respect to the ILPs.
111.At the end of the meeting I said that we should leave it for another month and when we meet again we would discuss whether Ms Sheldon was happy with the working arrangement and whether there was still a mismatch from the school’s perspective. I said that if there were still issues, we would need to reassess if the appointment is working for all parties.
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114.On or around 2 June 2020, I met Mr Argall to debrief on the second probationary meeting. I recall that he took notes during this meeting. During this discussion, we discussed Ms Sheldon’s continued underperformance in the Position and her failure to communicate with other staff effectively or produce ILPs in a timely manner. Nonetheless, we thought we would give Ms Sheldon another opportunity to demonstrate improvement, noting that this was the point of the probationary period.
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118.By June 2020, it was becoming increasingly clear that Ms Sheldon was not performing the duties of her Position to the required standard, despite a significant amount of coaching from DCC and the consistent constructive feedback I had given her (along with Mr Halliday). I was rapidly losing trust and confidence that she could meet our expectations in the role and was aware that we would need to make a decision as to whether Ms Sheldon would pass her probationary period shortly.
119. I attended the following meetings to discuss these matters.
a.On 10 June 2020, I met with Mr Argall, in which we discussed Ms Sheldon’s underperformance and our concern that she would not improve to the required standard. I recall that Mr Argall took notes during this meeting, as he did in every meeting.
b. On 11 June 2020, I had a meeting with Mr Argall, Jonathan Price, Business Manager, and Jennifer van Garderen, Human Resources and Assistant Business Manager, in which we again discussed Ms Sheldon’s underperformance. I recall that Mr Argall took notes during this meeting.
c. On 18 June 2020, I met with Mr Argall and we discussed our concerns in relation to Ms Sheldon’s performance, taking into account the continuing reports from the year level coordinators that Ms Sheldon was failing to meet their requests. I recall that Mr Argall took notes during this meeting.
d. On 22 June 2020, I had a meeting with Mr Argall in which we again discussed Ms Sheldon’s underperformance and our view that it was unlikely that we would progress Ms Sheldon beyond her probationary period. I recall that Mr Argall took notes during this meeting .
120.I also note that I received additional reports and feedback in discussions with year level coordinators on 17 and 18 June 2020 that Ms Sheldon was once again failing to complete tasks requested of her by them, including finalising the ILPs, which I discussed in my meetings with Mr Argall on 18 June 2020 and 22 June 2020.
Mr Venour explained in his affidavit sworn on 11 March 2021 that he and Mr Argall decided to terminate Ms Sheldon’s employment as follows:
121.Over the course of the meetings referred to in paragraph 118 above, Mr Argall and I agreed that we had not seen enough evidence of progress in Ms Sheldon’s performance since her commencement, and that she had consistently failed to meet the responsibilities of the Position. In particular, we were concerned about the clarity of her communications, about her failure to foster key relationships with staff in leadership roles and about the timeliness and thoroughness of Ms Sheldon’s follow through on agreed tasks.
122.Our view was that we had given Ms Sheldon ample opportunity and coaching to improve her performance, and we were concerned that student learning needs were being significantly compromised as she was not supporting year level coordinators adequately and continually failed to produce work (in particular ILPs) that was requested of her within a reasonable time frame and to an adequate standard. The feedback that we received from the year level coordinators was consistent over the length of Ms Sheldon’s employment despite the many informal discussions and probationary meetings that we convened with Ms Sheldon to discuss her underperformance and the strategies that we put in place to support her to achieve the aims of her role.
123.For these reasons, we decided that Ms Sheldon would not pass her probationary period. We decided to terminate her employment as a result of her unsatisfactory performance during the probationary period. These were the only considerations that Mr Argall and I relied on in arriving at our decision.
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129.I understand that Ms Sheldon alleges that DCC terminated her employment because:
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f.she made complaints/inquiries in her response to the record of probationary meetings dated 2 June 2020;
g. she suffered a jaw injury on 5 June 2020; or
h. she made a WorkCover claim in respect of her jaw injury on 15 June 2020.
130.I did not terminate Ms Sheldon’s employment for any of the reasons referred to above. Mr Argall and I made the decision to terminate Ms Sheldon’s employment for the reasons set out in this affidavit.
131.Further, in respect of the matters raised by Ms Sheldon above:
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e.I provided Ms Sheldon with the record of probationary meetings for the purposes of her providing any comments in respect of the matters we discussed on 19 and 26 May 2020. I did not regard the matters she raised as complaints or inquiries. I was not concerned by any of the matters raised for the reasons set out above;
f.Ms Sheldon’s jaw injury did not impact on her ability to perform the requirements of the Position and therefore had no relevance to any decision to terminate her employment; and
g.I am supportive of any employee making a WorkCover claim as it is their entitlement to do so. I was not concerned by the making of the WorkCover claim at all.
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134.At paragraph 142 of the Sheldon Affidavit, Ms Sheldon notes that on 27 May 2020, I emailed Ms Sheldon to encourage her to look towards a ‘product’ and not to take a “forensic view”. While I can find no record of this email, I do not recall making a comment that she look towards a ‘product’ or that she take a ‘forensic view’. My concern regarding her responsibilities was only that she occasionally got bogged down in the detail, which came at the expense of timely action - which was a key element of her role.
In his affidavit sworn on 22 September 2021, Mr Venour said:
53.At the commencement of Ms Sheldon’s employment, I recall a conversation with her regarding the lack of NCCD documentation and noted that we would require her assistance to improve the process.
54.In response to an alleged complaint being made described at paragraph 134 of Ms Sheldon’s first affidavit sworn on 11 December 2020 (First Sheldon Affidavit), I recall that Ms Sheldon said that NCCD process was lacking and noted that she had some concerns regarding whether DCC would pass an audit by the Australian Department of Education, on the basis that DCC may not have the necessary documentation in place to satisfy the documentation standards set under this new scheme. We both agreed that it would be beneficial to conduct a trial audit at DCC.
55. Ms Sheldon made similar comments in her response to the probation meeting notes annexed at SV-21 of the First Venour Affidavit.
56.In making these comments, I did not consider that Ms Sheldon was making a ‘complaint’. Specifically, Ms Sheldon did not make a complaint regarding DCC’s acquisition or allocation of NCCD funding. Nor did she state, at any time, that DCC was benefitting from the improper acquisition and allocation of funds.
57. It was my understanding that Ms Sheldon was merely identifying an area of improvement for DCC - one which I agreed with. As described at paragraph 106(e) of the First Venour Affidavit, I reassured Ms Sheldon that, ultimately, any issue with NCCD documentation would be the responsibility of Mr Jonathon Price, Business Manager, and Mr Tim Argall, Principal, and me. Further, in response to these concerns, DCC commenced action to improve its record keeping processes.
…
62.For the avoidance of doubt, I did not terminate Ms Sheldon’s employment because she made any complaints, including any complaints regarding NCCD compliance.
The cross-examination of Mr Venour
Mr Venour accepted in cross-examination that Donvale receives about $5,000 for each student in respect of whom it receives NCCD supplementary support, though he said he did not really know. He agreed that students needing substantial support would probably get more but he was unaware of the amount, or the total amount of NCCD funding that Donvale receives each year.
Mr Venour said that he had been in the final session with the NCCD auditor, and, when the process was finished, the spreadsheet was much more filled in than the spreadsheets exhibited by Ms Sheldon to her affidavit. He said his recollection was that, at the end of the process, they may have had missing information for 14 students, which may have resulted in five adjustments. He said that happened when the auditor was at the school, and that she was at the school for three or four days. He said that during the time when the auditor was at Donvale, the school had a more clear idea of what was required and gathered the required evidence from various different places around the school.
Mr Venour said that both he and Ms Sheldon were concerned in 2020 that the evidence that Donvale had for the NCCD audit was scattered in lots of different places and Donvale did not have a centralised format for gathering it. Mr Venour said that, between 2020 and 2022, Donvale had made some progress in gathering the evidence for the NCCD audit. He said that:
(a)the evidence could be anywhere;
(b)some of the evidence was in the form of teachers’ notes, and some evidence was in the archives; and
(c)Donvale was in the process of transitioning from hard copies to electronic copies, so some evidence was being digitised.
Mr Venour said that, in 2020, he knew that Donvale had a task to do in terms of gathering data, and that was what he and Ms Sheldon needed to work on, but he was not worried about Donvale’s position. Mr Venour accepted that if Donvale did not have the required evidence, it would need to repay funding to the government. Mr Venour said that, in 2020, he understood that the audit process was not seen as being vicious and punitive, but as a way to help schools to get the hang of the system. Mr Venour agreed that, if a school did not have the appropriate evidence in an audit, it would have to pay money back. Mr Venour volunteered that such a school should pay the money back.
Mr Venour said that he and Ms Sheldon agreed to do a trial audit, because he was conscious that it would take some time to gather the evidence. Mr Venour said that, at the time, he did not know for sure that Donvale had the required evidence, but he assumed that it did, and had confidence that it did. Mr Venour could not recall whether they actually did a trial audit, because that was about the time of the first COVID-19 lockdown, and the transition to online learning, when everything changed for teachers.
Mr Venour said that he expected that there might be some insufficiency in the evidence, and Donvale would have to repay some money. However, he said that would be totally fair enough, and he was not worried about it. He said that he was purely an operational teacher and did not have budgetary functions.
Mr Venour said that he could not recall discussing with Mr Argall the possibility that Donvale might not be able to gather all of the required evidence for an audit, but conceded that he might well have.
Mr Venour agreed that he might have asked Ms Sheldon not to be so forensic, but thought it was probably in relation to Donvale being a little understaffed and needed decisions to be made quickly, rather than being the subject of a deep dive.
Mr Venour said that, in 2020, he was not aware that Donvale had an NCCD coordinator. Ms Sheldon was the secondary student support coordinator, with some functions associated with the NCCD. In 2022, the director of teaching and learning took on the role of NCCD coordinator.
Mr Venour said that he asked Mr Halliday to gather the views of other staff members about Ms Sheldon’s strengths and weaknesses. Mr Halliday sent an email to one staff member on 16 June 2020 saying:
Be brutally honest. Margaret will not see your comments.
Mr Venour conceded that he had said to Mr Halliday previously to “be brutally honest”, and that Ms Sheldon would not see the feedback. He said that he did not want to make any decisions without having accurate information. He said he saw the process as a sort of due diligence. He denied that he was seeking feedback that would be damaging to Ms Sheldon’s employment.
Mr Venour said that he did not regard the issues that Ms Sheldon raised as being complaints or enquiries. He said that her statements seemed to be more in the nature of an observation with a proposed solution. He said that it never occurred to him that Ms Sheldon was a whistleblower or making a complaint.
Ms Venour agreed that, on 3 June 2020, the day after Ms Sheldon had provided her response to Mr Venour’s probation notes, he had given part of Ms Sheldon’s role in relation to ILPs to other staff. He said that Ms Sheldon had had the responsibility for ILPs for four months and nothing had happened so he stepped in. He denied that he had decided on 3 June 2020 to dismiss Ms Sheldon.
Mr Venour agreed that he had sent an email dated 3 June 2020 in which he noted that he had had three “heavy conversations” with Ms Sheldon, but was now “backing off”:
with the understanding that there is a month to go before a decision is made about her continuation. In the interim we operate as ‘normal’ as we can, engaging her as we ordinarily would.
Mr Venour reiterated that he had not decided on 3 June 2020 to dismiss Ms Sheldon, and relieving her of part of her role on 3 June 2020 was not in response to her comments on 2 June 2020 in relation to the probation process. Mr Venour said that it was “absolutely untrue” that he had been displeased by the feedback he received from Ms Sheldon on 2 June 2020 so he was making preparations on 3 June 2020 to dismiss her. He said that, at the time, Ms Sheldon appeared to be glad that she had been relieved of part of her role.
Mr Venour said ILPs were separate from the NCCD funding requirements, and were intended to give students who could not achieve mainstream curriculum goals some achievable goals so that they could progress. He said ILPs were developed with input from teachers and parents, and, if relevant, health professionals.
Mr Venour that, in his meetings with Mr Argall on 10, 11, 18 and 22 June 2020, they discussed Ms Sheldon. He denied that they discussed Ms Sheldon raising issues about NCCD evidence. He said that he could not actually remember the conversations but could not imagine bringing up the NCCD issue because he was not concerned about it. He said that Mr Argall made notes during the meetings. As mentioned above, those notes do not mention NCCD at all.
In relation to his claim that one of the reasons for Ms Sheldon’s dismissal was her poor relationships with other staff, Mr Venour conceded that Ms Sheldon’s specific issues with two particular members of staff appeared to have been resolved, but said that other issues remained.
Mr Venour agreed that he gave Ms Sheldon a deadline of 12 June 2020 to produce the ILPs, but said that he had also given her numerous other deadlines, dating back to February 2020, which Ms Sheldon did not meet. Moreover, Mr Venour said that the ILPs Ms Sheldon produced on 12 June 2020 were “not up to standard”.
When Mr Venour was asked if Ms Sheldon’s WorkCover claim filed on 9 June 2020 was the straw that broke the camel’s back, he said “Absolutely not. It made no difference to me at all.” He said that Ms Sheldon’s jaw injury did not figure in his thinking, as it did not impact on Ms Sheldon’s ability to fulfil her role.
The reasons for Ms Sheldon’s dismissal
I found the respondents’ witnesses to all be cogent and credible. They made appropriate concessions. I consider that Mr Venour, in particular, was a committed teacher who was focussed on the welfare of his students, and was motivated by their needs in his decisions about Ms Sheldon. In my view, the respondents have successfully discharged the reverse onus in relation to the reasons for Ms Sheldon’s dismissal.
With respect, I consider that Ms Sheldon did underperform for a considerable period of time, especially in relation to ILPs. ILPs were required, for the benefit of students, early in the semester, to ensure that the students’ curricula for that semester were appropriate for each student’s individual needs. By not delivering the ILPs until 12 June 2020, after repeated deadlines had passed, Ms Sheldon failed to meet a core responsibility of her position. I accept that the ILPs that she eventually produced were not up to standard.
Mr Argall, in particular, was very patient with Ms Sheldon’s shortcomings, and gave Ms Sheldon more time to improve her performance than many in his position would have given her. Ms Sheldon also had a range of difficulties with staff members. While some issues with colleagues were resolved, others remained.
It seems to me that Ms Sheldon’s underperformance gave Donvale, Mr Argall and Mr Venour ample reason to decide to dismiss her. However, that does not exactly answer the question for the court. The question for the court is whether any of the prohibited reasons alleged by Ms Sheldon was a substantial and operative reasons for her dismissal.
Ms Sheldon focussed on the timing of her disclosures and complaints in relation to the decision to dismiss her. However, the underlying problems identified by the respondents were occurring simultaneously. That is, while Ms Sheldon was making disclosures and complaints, she was not meeting deadlines for the production of ILPs and was not developing good working relationships with her colleagues.
I consider that Ms Sheldon’s disclosures or complaints about Donvale’s NCCD funding did not play a part in the decision by Mr Argall and Mr Venour to dismiss her. I accept that, in 2020, NCCD funding was part of a new system with new documentary requirements, and Donvale struggled to get all of its processes and documents organised in a timely manner. However, I do not consider that, in 2020, Mr Argall or Mr Venour considered that Donvale was at any risk of being found to have defrauded the Commonwealth, or at any risk of being required to repay substantial amounts of NCCD funding.
I accept Mr Venour’s evidence that, in 2020, the audits of NCCD funding were not intended to be punitive but were more in the nature of educating schools about how to gather and organise their evidence for NCCD funding purposes. I accept Mr Venour’s evidence that he did not perceive the matters Ms Sheldon raised about NCCD funding as complaints or disclosures, but thought they were more in the nature of the identification of a problem and a proposed solution, as would be expected of a person in a leadership position, such as Ms Sheldon.
I accept Mr Venour’s evidence that he was not, in May and June 2020, concerned about NCCD funding because he believed that the required evidence could eventually be gathered. As exhibit 2 shows, any overpayment to Donvale was, in the context of Donvale’s overall NCCD funding, trifling. On Ms Sheldon’s figures, the overpayment was about $25,000 (5 x $5,000). I daresay that the repayment of such a sum would not cause a significant problem in Donvale’s budget.
All in all, I do not accept Ms Sheldon’s claim that she was dismissed because she made complaints or disclosures about Donvale’s NCCD funding.
I do not accept that either Ms Sheldon’s WorkCover claim or her disability consisting of her jaw injury was a substantial and operative reason for her dismissal. I accept Mr Argall’s and Mr Venour’s denials on these matters. Donvale was insured. Whether the insurer had to pay some money to Ms Sheldon was neither here nor there for Donvale. I accept Mr Venour’s evidence that Ms Sheldon’s jaw injury did not prevent her from fulfilling her role, so it did not figure in his thinking about her suitability for ongoing employment.
Ms Sheldon also alleged that she was dismissed because she complained in her probation response about other staff being given part of her role. I accept Mr Venour’s evidence on this point, which was that:
(a)other staff were given part of Ms Sheldon’s role because she had, for an extended period of time, failed to fulfil it;
(b)at the time, Ms Sheldon seemed happy to be relieved of part of her role; and
(c)he did not decide to dismiss Ms Sheldon because of anything she said in her probation response.
Mr Argall also denied that Ms Sheldon was dismissed for any such reason. I accept Mr Argall’s evidence on this also. He kept detailed notes of his meetings with Mr Venour and this point was not mentioned in his notes. I see no reason to not accept Mr Argall’s denials on this point.
Finally, Ms Sheldon alleged that she was dismissed because she complained in her probation response about being excluded from certain decision-making processes. This matter was not put to Mr Argall or Mr Venour in cross-examination. However, their affidavit evidence amounted to a denial of it. I accept their denials. It seems to me that, in the context of Ms Sheldon’s ongoing underperformance, this issue would not have registered with Mr Argall and Mr Venour at all.
Consequently, the adverse action claim will be dismissed.
the whistleblower claim
The whistleblower legislation
The whistleblower provisions in the Corporations Act are in Part 9.4AAA of that Act. That Part includes s.1317AA and s.1317AC. On the date of Ms Sheldon’s dismissal, being 24 June 2020, s.1317AA of the Corporations Act relevantly provided as follows:
Disclosures qualifying for protection under this Part
…
Disclosure to eligible recipients
(2) A disclosure of information by an individual (the discloser) qualifies for protection under this Part if
(a) the discloser is an eligible whistleblower in relation to a regulated entity; and:
(b)the disclosure is made to an eligible recipient in relation to the regulated entity; and
(c) subsection (4) or (5) applies to the disclosure.
…
Disclosable matters
(4) This subsection applies to a disclosure of information if the discloser has reasonable grounds to suspect that the information concerns misconduct, or an improper state of affairs or circumstances, in relation to:
(a) the regulated entity; or
…
(5) Without limiting subsection (4), this subsection applies to a disclosure of information if the discloser has reasonable grounds to suspect that the information indicates that any of the following:
(a)the regulated entity, or an officer or employee of the regulated entity;
…
has engaged in conduct that:
…
(e) represents a danger to the public or the financial system; or
...
On the date of Ms Sheldon’s dismissal, being 24 June 2020, s.1317AC of the Corporations Act relevantly provided as follows:
Victimisation prohibited
Actually causing detriment to another person
(1) A person (the first person) contravenes this subsection if:
(a) the first person engages in conduct; and
(b)the first person’s conduct causes any detriment to another person (the second person); and
(c)when the first person engages in the conduct, the first person believes or suspects that the second person or any other person made, may have made, proposes to make or could make a disclosure that qualifies for protection under this Part; and
(d)the belief or suspicion referred to in paragraph (c) is the reason, or part of the reason, for the conduct.
Note 1: Failure to comply with this subsection is an offence (see subsection 1311(1)).
Note 2: This subsection is also a civil penalty provision (see section 1317E). For relief from liability to a civil penalty relating to this subsection, see section 1317S.
…
Officers and employees involved in contravention
(3)If a company contravenes subsection (1) or (2), any officer or employee of the company who is involved in that contravention contravenes this subsection.
The respondents’ position
The respondents did not dispute that Donvale was at all relevant times a regulated entity as defined in s.1317AAB of the Corporations Act. That definition includes companies. Nor did the respondents dispute that Ms Sheldon was an eligible whistleblower as defined in s.1317AAA of the Corporations Act. That definition includes employees of a regulated entity. Nor did the respondents dispute that the people to whom Ms Sheldon made the disclosures were eligible recipients as defined in s.1317AAC of the Corporations Act. That definition includes officers and senior managers of a body corporate. It would appear that the respondents accepted that Donvale’s business manager and Mr Venour were eligible recipients.
However, the respondents argued that Ms Sheldon’s disclosures did not qualify for protection, because she did not have reasonable grounds to suspect that:
(a)the information concerned misconduct, or an improper state of affairs or circumstances; or
(b)Donvale had engaged in conduct that represented a danger to the financial system.
The financial system point
The respondents argued that “the financial system”, referred to in s.1317AA(5)(e) of the Corporations Act, must have meant the national or state financial system, rather than the financial system of the regulated entity. Ms Sheldon did not make any arguments contrary to the respondents’ submission on this point.
“Financial system” is not defined in the Corporations Act. The term as used in s.1317AA(5)(e) of the Corporations Act does not appear to have been judicially considered. According to Investopedia, the financial system is:
A set of institutions, such as banks, insurance companies and stock exchanges, that permit the exchange of funds.
I accept the Investopedia definition as reasonably accurate for present purposes. Ms Sheldon did not argue or provide any evidence that any conduct of Donvale could have represented a danger to the financial system so understood. At worst, Donvale’s alleged actions could have amounted to a fraud on the Commonwealth amounting to tens of thousands of dollars. While deplorable, such frauds are not unusual, and do not represent a danger to the financial system. It follows that Ms Sheldon’s claim under s.1317AA(5)(e) of the Corporations Act must fail.
Whether Ms Sheldon had reasonable grounds to suspect
In relation to Ms Sheldon’s claim under s.1317AA(4)(a) of the Corporations Act, that Donvale had engaged in misconduct, or there was an improper state of affairs or circumstances existing at Donvale, the respondents argued that Ms Sheldon did not have reasonable grounds to suspect any of those things, so her disclosures were not protected under Part 9.4AAA of the Corporations Act.
The respondents relied on Quinlan v ERM Power Ltd (2021) 7 QR 377; (2021) 303 IR 200; [2021] QSC 35, a first instance decision of Bowskill J sitting in the Supreme Court of Queensland. The respondents relied on that case particularly in relation to the word “has” in the phrase “has reasonable grounds to suspect”. In Quinlan, Bowskill J said at [33]:
This approach gives meaning to the word “has” in the phrase “has reasonable grounds to suspect”. The discloser must, himself or herself, have – in the sense of possessing – reasonable grounds for suspecting the relevant matters before disclosure of those matters can qualify for protection. The text of the statute directs attention to the information which formed the basis of the particular discloser’s suspicion; rather than, objectively, by reference to other information not known by the discloser, or which becomes known subsequently.
(footnote omitted)
Primarily, the respondents relied on Quinlan to argue that the court should give no weight to documents from the Department of Education, Skills and Employment (exhibit 2) subpoenaed by the applicant. However, as discussed above, I consider that exhibit 2 is relevant as it tends to show that Ms Sheldon had a proper foundation for what she claimed to believe in 2020 about Donvale’s NCCD funding.
In her affidavit sworn on 11 December 2022, Ms Sheldon said the following in relation to her disclosures about NCCD funding:
133.Later the same day [11 May 2020], I spoke to Mr Price regarding the money which had been allocated to DCC through the NCCD. Given my position description confirmed I was responsible for administrating the funding received from NCCD, I thought it was pertinent to find out how such funding had been allocated. I also gave him information about my efforts to collate all the relevant data from the various departments’ spreadsheets and tables e.g. Counselling, First Aid and the Hub, into one central spreadsheet so we could run better searches and reports on the secondary school NCCD data.
134.On 11 May 2020, I attended a Professional Development program via Teams in relation to ‘NCCD Auditing Processes’. I was aware that Mr Venour and Mr Price were also going to join identical sessions covering the same topics but with different participating schools. This session highlighted to me the shortfalls in the NCCD evidence gathering and storage and diagnostic processes operating at DCC. I concluded that should we be unexpectedly audited by the Education Department, we would not be able to satisfy their accountability requirements. Shortly after my PD, Mr Venour and Mr Price attended their sessions. I then spoke to Mr Venour to compare our experiences and learnings. He expressed similar conclusions about the DCC NCCD practices, and we agreed that it would be prudent and highly beneficial to conduct a trial audit of our own at DCC. To progress the NCCD system further at DCC, I searched across my professional network and accessed a proforma NCCD Evidence Form that would help teachers record the details of their classroom adjustments for their students. I discussed this form with Mr Lyon who gave me further ideas about how we could adapt it and include it on the Schoolbox system. I gave it to a number of staff who trialled it and provided positive feedback. I did not get to finalise its implementation before my employment was terminated. Mr Venour did not speak with me any further about my NCCD auditing concerns until the day of my termination.
…
145.On 2 June 2020, I sent an email to Mr Venour attaching a draft of my responses to Mr Venour’s Probationary Notes. In my response, I advised Mr Venour that:
…
(d)DCC had not complied with the administrative requirements of the NCCD. I expressed concern regarding the DCC’ s inability to produce the required evidence for funding under the NCCD should an audit occur. I reiterated that as per my position description, I was responsible for facilitating the administration associated with the NCCD;
…
Ms Sheldon exhibited to her affidavit sworn on 11 December 2020 her response to Mr Venour’s probationary notes (exhibit MS-57) (CB217), being her response following a probation meeting on 19 May 2020. That response included the following:
Now that I have been able to access stored information related to support services at DCC and the data related to the NCCD, I have serious concerns about the school’s exposure to financial accountability for funds attracted through the NCCD system. The diagnosis, category allocation and evidence gathering systems are not consistent nor are the necessary adjustments for students with special needs appropriately implemented or evidenced by staff. The documentation for these processes is also not efficiently stored and therefore not easily accessible should an NCCD audit be conducted across the school I believe DCC will fall short.
As the only Special Education teacher in the Secondary School, I feel the responsibility for leadership during such an audit will fall to me and yet I [am] not empowered to make appropriate preparations for this process. I have started to use NCCD guidelines to inform various aspects of the support practices at DCC and I have made efforts to communicate the relevance and the usefulness of doing this but I have now been told that my priority is elsewhere so I am limited as to what I can do.
Considering the significant funds that DCC attracts for its enrolled students with disabilities, the support options and opportunities for students with special needs should not be as “lean” as they are at present. There are between 120 and 130 students with supplementary or substantial educational needs in the secondary school and whilst the team of Tutors provide an exemplary support service, a single Special Education Teacher administering and coordinating special education services in the secondary section of the school, with all that entails within the NCCD guidelines, is woefully unworkable and would be inexplicable to auditors.
Ms Sheldon sent Mr Venour an email on 2 June 2020 that contained a somewhat amended response to the probation interview. That email is contained in exhibit SV-21 to the affidavit sworn by Mr Venour on 11 March 2021 (CB734). The last paragraph set out above in the later version was as follows (with the additions underlined and the omitted parts struck through):
Considering the significant funds that DCC attracts for its enrolled students with disabilities, the support options and opportunities for students with special needs should not be as “lean” as they are at present. There are between 120 and 130 students with supplementary or substantial educational needs in the secondary school who require support.
and whilstWhilst the team of Tutors provide an exemplary support service, the provision of only onea singleSpecial Education Teacheradministering and coordinating special education services in the secondary section of the school, with all that entails within the NCCD guidelines, is woefully unworkable and would be inexplicable to auditorsto coordinate the delivery of appropriate NCCD adjustments across the whole of Secondary, is simply not enough.The respondents’ point was that Ms Sheldon, in May and June 2020, did not have reasonable grounds to suspect that there was misconduct or an improper state of affairs or circumstances at Donvale. Ms Sheldon’s response to the probationary review, as set out above, said that she had serious concerns about matters that can properly be described as misconduct or an improper state of affairs or circumstances. Her email also explained how she came to that view, namely, that she had accessed stored information.
The phrase “reasonable grounds to suspect” has been considered many times by the courts. For example, in Quinlan, Bowskill J said the following in relation to that phrase:
23.That is a familiar phrase in the context, in particular, of statutes regulating the exercise powers of arrest and to issue search warrants.
24.The phrase has been held to comprise both subjective and objective elements: the discloser must, themselves (subjectively) possess grounds to suspect the relevant things; and those grounds must, objectively, be reasonable.
25.As to the objective element, in George v Rockett (1990) 170 CLR 104 (“George v Rockett”), which was concerned with the power of a Magistrate to issue a search warrant, where he or she was satisfied there were reasonable grounds for suspecting certain things,19 the Court said that:
“When a statute prescribes that there must be ‘reasonable grounds’ for a state of mind — including suspicion and belief — it requires the existence of facts which are sufficient to induce that state of mind in a reasonable person.”20
26. As the Court in George v Rockett also said:
“In considering the sufficiency of a sworn complaint to show reasonable grounds for the suspicion and belief to which s 679 refers, it is necessary to bear in mind that suspicion and belief are different states of mind …
Suspicion, as Lord Devlin said in Hussein v Chong Fook Kam, ‘in its ordinary meaning is a state of conjecture or surmise where proof is lacking: “I suspect but I cannot prove.”’ The facts which can reasonably ground a suspicion may be quite insufficient reasonably to ground a belief, yet some factual basis for the suspicion must be shown. In Queensland Bacon Pty Ltd v Rees, a question was raised as to whether a payee had reason to suspect that the payer, a debtor, ‘was unable to pay [its] debts as they became due’ as that phrase was used in s 95(4) of the Bankruptcy Act 1924 (Cth). Kitto J said:
‘A suspicion that something exists is more than a mere idle wondering whether it exists or not; it is a positive feeling of actual apprehension or mistrust, amounting to “a slight opinion, but without sufficient evidence”, as Chambers’s Dictionary expresses it. Consequently, a reason to suspect that a fact exists is more than a reason to consider or look into the possibility of its existence. The notion which “reason to suspect” expresses in sub-s (4) is, I think, of something which in all the circumstances would create in the mind of a reasonable person in the position of the payee an actual apprehension or fear that the situation of the payer is in actual fact that which the subsection describes — a mistrust of the payer’s ability to pay his debts as they become due and of the effect which acceptance of the payment would have as between the payee and the other creditors.’
The objective circumstances sufficient to show a reason to believe something need to point more clearly to the subject matter of the belief, but that is not to say that the objective circumstances must establish on the balance of probabilities that the subject matter in fact occurred or exists: the assent of belief is given on more slender evidence than proof. Belief is an indication of the mind towards assenting to, rather than rejecting, a proposition and the grounds which can reasonably induce that inclination of the mind may, depending on the circumstances, leave something to surmise or conjecture.”21
27.As the next case makes clear, the factual basis for the suspicion, to which the test of reasonableness is applied, is that which is known to the person who suspects. It is not an objective set of circumstances. In O’Hara v Chief Constable of the Royal Ulster Constabulary [1997] AC 286 (“O’Hara”), the House of Lords considered the meaning of the phrase “has reasonable grounds for suspecting” in the context of a power to arrest without warrant. In that case, the plaintiff (the subject of an arrest) contended, as the plaintiff does here, that the test required proof that the reasonable grounds on which the police officer based his suspicion existed in fact; that the objective part of the test required proof of something more than what was in the mind of the arresting officer. That argument was unanimously rejected. As Lord Hope of Craighead (with whom the other members of the Court agreed) explained:
“… the test [that ‘a constable may arrest without warrant a person whom he has reasonable grounds for suspecting to be …’] is a simple but practical one. It relates entirely to what is in the mind of the arresting officer when the power is exercised. In part it is a subjective test, because he must have formed a genuine suspicion in his own mind that the person has been concerned in acts of terrorism. In part also it is an objective one, because there must also be reasonable grounds for the suspicion which he has formed. But the application of the objective test does not require the court to look beyond what was in the mind of the arresting officer. It is the grounds which were in his mind at the time which must be found to be reasonable grounds for the suspicion which he has formed. All that the objective test requires is that these grounds be examined objectively and that they be judged at the time when the power was exercised.
This means that the point does not depend on whether the arresting officer himself thought at that time that they were reasonable. The question is whether a reasonable man would be of that opinion, having regard to the information which was in the mind of the arresting officer. It is the arresting officer’s own account of the information which he had which matters, not what was observed by or known to anyone else. The information acted on by the arresting officer need not be based on his own observations, as he is entitled to form a suspicion based on what he has been told. His reasonable suspicion may be based on information which has been given to him anonymously or it may be based on information, perhaps in the course of an emergency, which turns out later to be wrong. As it is the information which is in his mind alone which is relevant however, it is not necessary to go on to prove what was known to his informant or that any facts on which he based his suspicion were in fact true. The question whether it provided reasonable grounds for the suspicion depends on the source of his information and its context, seen in the light of the whole surrounding circumstances.”22
28.George v Rockett and O’Hara were applied by the New South Wales Court of Appeal in Hyder v Commonwealth (2012) 217 A Crim R 571 (“Hyder”). That case, like O’Hara, concerned the meaning of a power in the Crimes Act 1914 (Cth) authorising the arrest of a person, without warrant, albeit where the constable believes (rather than suspects) on reasonable grounds that the person has committed or is committing an offence.
29.The Court of Appeal divided as to whether the primary judge had erred in their approach (McColl JA and Hoeben JA finding that they had not; Basten JA concluding otherwise). However, on the question of principle, as to the meaning of the test, there was no disagreement. McColl JA (576–577 [15]) summarised a number of propositions relevant to the test. These included:
“(7)What constitutes reasonable grounds for forming a suspicion or a belief must be judged against ‘what was known or reasonably capable of being known at the relevant time’: Ruddock v Taylor (2005) 222 CLR 612 at [40] per Gleeson CJ, Gummow, Hayne and Heydon JJ; whether the relevant person had reasonable grounds for forming a suspicion or a belief must be determined not according to the subjective beliefs of the police at the time but according to an objective criterion: Anderson v Judges of District Court (NSW) (1992) 27 NSWLR 701 at 714; 62 A Crim R 227 at 289 per Kirby P (Meagher and Sheller JJA agreeing); see also O’Hara v Chief Constable of Royal Ulster Constabulary (at 298) per Lord Hope;
(8)The information acted on by the arresting officer need not be based on his own observations; he or she is entitled to form a belief based on what they have been told. The reasonable belief may be based on information which has been given anonymously or on information which turns out to be wrong. The question whether information considered by the arresting officer provided reasonable grounds for the belief depends on the source of the information and its context, seen in the light of the whole of the surrounding circumstances and, having regard to the source of that information, drawing inferences as to what a reasonable person in the position of the independent observer would make of it: O’Hara v Chief Constable of Royal Ulster Constabulary (at 298, 301, 303) per Lord Hope …”
30. Further, her Honour said, 583 [43]:
“It is important in this, as in other fields of legal discourse, to be careful not to judge the ‘reasonable grounds’ issue with the benefit of hindsight. As I have earlier explained (see [15](8)), a reasonable belief may be based on information which turns out to be wrong. That much was accepted in the appellant’s case when the charges against him were withdrawn. However a court must be careful not to assess the question whether the arresting officer had reasonable grounds for his or her suspicion or belief prior to the arrest through the prism of ipso facto acquired knowledge.”23
31.Basten JA, likewise, confirmed that in respect of both the subjective and objective elements of the test, the inquiry must be determined by reference to matters known to the constable at the time of carrying out the arrest; and that “nothing which was not before [the constable] at the time he carried out the arrest is of any relevance to the objective assessment” (586 [59], 591 [80]).
32.George v Rockett, O’Hara and Hyder have more recently been applied by a differently constituted New South Wales Court of Appeal in State of New South Wales v Bouffler (2017) 95 NSWLR 521 (Beazley ACJ, Ward and Gleeson JJA), which reinforced the principle that the objective requirement of the “reasonablegrounds for suspecting” test does not require looking beyond what was in the mind of the officer who effected the arrest (541–542 [87]–[92]).24
33.This approach gives meaning to the word “has” in the phrase “has reasonable grounds to suspect”. The discloser must, himself or herself, have – in the sense of possessing – reasonable grounds for suspecting the relevant matters before disclosure of those matters can qualify for protection. The text of the statute directs attention to the information which formed the basis of the particular discloser’s suspicion; rather than, objectively, by reference to other information not known by the discloser, or which becomes known subsequently.25
34.There is no reason why the approach to construction of the test, where the words “has reasonable grounds to suspect” are used in s 1317AA, should be any different from the now well-settled approach where those words appear in provisions dealing with arrests or warrants. Although the context in which the test appears is different, by using, without alteration, a phrase which has been judicially considered, the Legislature is presumed to have intended the words to bear the meaning already judicially attributed to them.26 In addition, construing the phrase “has reasonable grounds to suspect” consistently with the authorities discussed above is consistent with the purpose of the provisions, as discussed in [18] above, namely, to provide a statutory inducement or incentive to encourage appropriate disclosure of suspected corporate misconduct – to facilitate early detection of such misconduct; but to balance the risk of improper invocation of the qualified protection by imposing a requirement of objective reasonableness upon the whistleblower’s grounds for suspecting. To permit or require “reasonableness” to be established by reference to material not known by the discloser is not consistent with that purpose. Nor is limiting “reasonableness” to circumstances where the suspected matters can be shown to have actually occurred. On the contrary, that would place an unnecessarily onerous burden on a potential whistleblower, which would discourage reporting.
35.Consistent with that position, in the only authority I have been able to find dealing specifically with s 1317AA, The Environmental Group Ltd v Bowd (2019) 137 ACSR 352, Steward J (then of the Federal Court) applied George v Rockett to the meaning of “reasonable grounds to suspect” (405–407 [180]). The approach his Honour took to considering whether the discloser’s grounds to suspect were reasonable accords with the authorities discussed above – that is, to consider what the discloser says he knew at the time of the disclosure and, by reference to that, form a view whether that provided reasonable grounds to suspect contraventions had occurred.
FN 19:Under s 679 Criminal Code 1899.
FN 20:George v Rockett (1990) 170 CLR 104, 112.
FN 21:George v Rockett (1990) 170 CLR 104, 115–116. Underlining added. References omitted.
FN 22:O’Hara v Chief Constable of the Royal Ulster Constabulary [1997] AC 286, 298, 301–302. Underlining added.
FN 23:See also Hyder v Commonwealth (2012) 217 A Crim R 571, 592–593 [86]–[89] (Hoeben JA).
FN 24:An application for special leave to appeal to the High Court from this decision was refused: [2017] HCASL 321.
FN 25:See, by analogy, Australian Competition and Consumer Commission v Woolworths Ltd [2019] FCA 1039, [129].
FN 26:WorkPac Pty Ltd v Skene (2018) 264 FCR 536, 561 [107].
The cases establish that “reasonable grounds to suspect” does not require proof on the balance of probabilities but does require something more than idle wondering. A suspicion is less than a belief. A suspicion is “a slight opinion, but without sufficient evidence”. A reasonable ground to suspect is material that, in the mind of a reasonable person, would lead to the relevant suspicion.
In the present case, I consider that, in May and June 2020, Ms Sheldon did have reasonable grounds for her suspicion that there was misconduct or an improper state of affairs or circumstances at Donvale. She had examined Donvale’s records and found that:
The diagnosis, category allocation and evidence gathering systems are not consistent nor are the necessary adjustments for students with special needs appropriately implemented or evidenced by staff.
This led her to have serious concerns:
about the school's exposure to financial accountability for funds attracted through the NCCD system
and led her to form the belief that Donvale would “fall short” if an audit were conducted.
The respondents were at pains to exclude exhibit 2 from the consideration of this matter. However, my conclusions above are not at all dependent on exhibit 2. Ms Sheldon had sufficient material in May and June 2020, from her examination of Donvale’s records, to form her reasonable suspicion. Exhibit 2 merely supports the conclusion that Ms Sheldon can be believed when she tells the court that she suspected misconduct or an improper state of affairs or circumstances at Donvale.
The respondents also relied on Environmental Group Ltd v Bowd (2019) 137 ACSR 352; (2019) 288 IR 396; [2019] FCA 951 where Steward J, sitting in the Federal Court, emphasised at [180] that the disclosure under s.1317AA of the Corporations Act must be made in good faith. In Bowd, Steward J found that the disclosure was not made in good faith. However, in the present case, I consider that Ms Sheldon’s disclosures were made in good faith. While her disclosure in the context of a probation interview in June 2020 might be thought to have had ulterior motives, the fact is that Ms Sheldon raised the same point on 11 May 2020. That was not in the context of a probation interview but was in the context of a professional development training session, which clearly made Ms Sheldon very concerned about Donvale’s NCCD processes.
Whether the dismissal was because of Ms Sheldon’s NCCD disclosures
However, the discussion above on the whistleblower disclosures is not the end of the matter. The question posed by s.1317AC(1) of the Corporations Act is whether the first person (Donvale) caused detriment to Ms Sheldon (dismissed her) because she made a disclosure under s.1317AA of the Corporations Act.
For the reasons discussed above in relation to the adverse action claim, I do not consider that Ms Sheldon’s disclosures about Donvale’s NCCD funding played any part in the decision to dismiss her. Consequently, the whistleblower aspect of Ms Sheldon’s claim will be dismissed.
I certify that the preceding one hundred and twenty-six (126) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Riley. Associate:
Dated: 24 November 2022
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