Shum v Southern Migrant and Refugee Centre Inc (No 3)
[2025] FedCFamC2G 393
•8 May 2025
FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA
(DIVISION 2)
Shum v Southern Migrant and Refugee Centre Inc (No 3) [2025] FedCFamC2G 393
File number(s): MLG 995 of 2022 Judgment of: JUDGE FORBES Date of judgment: 8 May 2025 Catchwords: FAIR WORK – general protections – where applicant alleges dismissal for a prohibited reason or reasons – complex background narrative – whether applicant possessed or exercised workplace rights – consideration of complaints applicant is able to make – where purported reason for dismissal was redundancy following organisational restructure – where corporate respondent identifies a single decision-maker – consideration of the scope of the corporation’s state of mind - whether other persons contributed to decision-making in a material, substantial or essential manner – whether states of mind of decision-maker or those who contributed infected by prohibited reasons – statutory presumption in favour of prohibited reasons alleged by applicant – whether respondent discharged the statutory onus – lanunae and inconsistencies in the evidence of decision-making processes and reasoning – where court not persuaded that applicant’s exercises of workplace rights did not actuate or influence decision to restructure and terminate – statutory onus to “prove otherwise” not discharged – whether second and third respondents involved in the corporate respondent’s contravention Legislation: Fair Work Act 2009 (Cth) ss 117, 340, 341, 342, 360, 361, 550, 793 Cases cited: Alam v National Australia Bank (2021) 288 FCR 301; [2021] FCAFC 178
Australian Building and Construction Commissioner v Hall [2018] FCAFC 83; (2018) 261 FCR 347
Australian Red Cross Society v Queensland Nurses’ Union of Employees (2019) 273 FCR 332
Board of Bendigo Institute of Technical and Further Education v Barclay (2012) 248 CLR 500; [2012] HCA 32
Brambles Holdings Ltd v Carey (1976) 12 SASR 270
Cigarette & Gift Warehouse Pty Ltd v Whelan [2019] FCAFC 16; (2019) 268 FCR 46
Construction, Forestry, Mining and Energy Union v Anglo Coal (Dawson Services) Pty Ltd [2015] FCAFC 157; (2015) 238 FCR 273
Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [2014] HCA 41, (2014) 253 CLR 243
Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [2017] FCAFC 50
Construction, Forestry, Mining and Energy Union v Claremont Coal Pty Ltd [2015] FCA 1014; (2015) 253 IR 166
Eckel v Ballarat Community Health Ltd [2022] FedCFamC2G 890
Elliot v Kodak Australasia Pty Ltd [2001] FCAFC 1804; (2001) 129 IR 251
Ermel v Dulux Group (Australasia) Pty Ltd (No.2) [2015] FCA 17
Evans v Braddock [2015] NSWSC 249
EZY Accounting 123 Pty Ltd v Fair Work Ombudsman [2018] FCAFC 134
Fair Work Ombudsman v Devine Marine Group Ltd [2014] FCA 1365
Fair Work Ombudsman v Hu [2019] FCAFC 133
Fair Work Ombudsman v South Jin Pty Ltd [2015] FCA 1456
General Motors-Holder Pty Ltd v Bowling (1976) 12 ALR 605
Gestmin SGPS SA v Credit Suisse (UK) Limited [2013] EWHC 3560
Hill v Compass Ten Pty Ltd [2012] FCA 761; (2012) 205 FCR 94
Kaur v P&G Accounting Solutions Pty Ltd [2025] FedCFamC2G 30
Khiani v Australian Bureau of Statistics [2011] FCAFC 109
Lehrmann v Network Ten Pty Limited (Trial judgment) [2024] FCA 369
Maric v Ericsson Australia Pty Ltd 293 IR 442
Messenger v Commonwealth of Australia(Represented by the Department of Finance) [2022] FCA 677
National Tertiary Education Union v Royal Melbourne Institute of Technology (2013) 234 IR 139
PIA Mortgage Services Pty Ltd v King [2020] FCAFC 15; (2020) 274 FCR 225
Pilbrow v University of Melbourne [2024] FCA 1140
Qantas Airways Limited v Transport Workers Union of Australia (2023) 278 CLR 571
Qantas Airways Ltd v Transport Workers’ Union of Australia (2023) 412 ALR 134
Roberts v General Motors-Holden’s Employees’ Canteen Society Inc (1975) 172 CAR 1073
Shea v TRUenergy Services Pty Ltd (No 6) [2014] FCA 271
Short v Ambulance Victoria [2015] FCAFC 55; (2015) 249 IR 217
Shum v Southern Migrant and Refugee Centre Inc & Ors [2020] FCCA 21
Southern Migrant and Refugee Centre Inc v Shum (No 3) [2022] FCA 481
Tattsbet Ltd v Morrow [2015] FCAFC 62; (2015) 233 FCR 46
Transport Workers’ Union of Australia v Qantas Airways Limited (2021) 308 IR 244
Voigtsberger v Pine Rivers Shire Council (1981) 1 IR 198
Whelan v Cigarette & Gift Warehouse Pty Ltd [2017] FCA 1534; (2017) 275 IR 285
Wong v National Australia Bank (2022) 318 IR 148; [2022] FCAFC 155
Wong v National Australia Bank Limited [2021] FCA 671
Wood v City of Melbourne Corporation [1979] 26 ALR 430
Zhang v Royal Australian Chemical Institute Inc [2005] FCAFC 99, (2005) 144 FCR 347
Division: Division 2 General Federal Law Number of paragraphs: 547 Dates of hearing: 23-26 May 2023; 22-23 June 2023; 24 October 2023; 13 November 2023; 1 December 2023 Place: Melbourne The Applicant: In person Counsel for the Respondents: Mr N Harrington Solicitor for the Respondents: Lander & Rogers ORDERS
MLG 995 of 2022 FEDERAL CIRCUIT AND FAMILY COURT OF AUSTRALIA (DIVISION 2)
BETWEEN: LAI SHUM
Applicant
AND: SOUTHERN MIGRANT AND REFUGEE CENTRE INC
First Respondent
TRAVIS SCOTT HEENEY
Second Respondent
BRIAN HERBERT OATES
Third Respondent
ORDER MADE BY:
JUDGE FORBES
DATE OF ORDER:
8 MAY 2025
THE COURT DECLARES:
1.That by terminating the employment of the Applicant on 19 June 2017 the First Respondent took adverse action against the Applicant in contravention of section 340(1) of the Fair Work Act 2009 (Cth).
2.That the Second Respondent and the Third Respondent were involved in the First Respondent’s contravention within the meaning of section 550 of the Fair Work Act2009 (Cth) and are taken to have contravened section 340(1) of the Act.
AND THE COURT ORDERS THAT:
3.This proceeding will be listed for a case management conference before Judge Forbes on 10 June 2025 at 9.30am for the purpose of making orders with respect to:
(a)the filing of evidence and written submissions in relation to the relief sought by the Applicant;
(b)the filing of evidence and submissions in relation to the Applicant’s claim for relief in relation to s 117 of the Fair Work Act 2009 (Cth);
(c)listing the matter for the hearing of evidence and oral submissions; and
(d)such other matters as may be necessary to facilitate the orderly determination of all remaining outstanding issues
4.The parties are at liberty to propose case management orders by consent and, if approved by the Court, the case management hearing will be vacated.
Note: The form of the order is subject to the entry in the Court’s records.
Note: The Court may vary or set aside a judgment or order 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).
TABLE OF CONTENTS
SYNOPSIS
[1]
CONTEXT OF THESE PROCEEDINGS
[34]
THE STATUTORY FRAMEWORK
[39]
ISSUES TO BE DETERMINED
[53]
PRE-TRIAL CASE MANAGEMENT
[57]
THE REMITTAL HEARING
[70]
Witnesses
[76]
Applicant
[77]
Respondents
[77]
Dramatis Personae
[77]
Some comments about credit
[78]
BACKGROUND FACTS
[89]
An aside - Board minutes and other “contemporaneous” documents
[146]
Return to the narrative
[170]
The “crisis accountant” Ms Pollard
[180]
23 March 2017 Urgent board meeting
[188]
30 March 2017 Board meeting
[199]
11 April 2017 Special Board meeting
[213]
Another aside - The Pollard reports
[219]
Returning again to the narrative
[227]
20 April 2017 Board meeting
[239]
The recruitment of Mr Heeney
[242]
Mr Heeney commences employment
[258]
10 May 2017 Special Board meeting
[264]
18 May 2017 Board meeting
[275]
The proposed organisational restructure
[291]
Ms Shum is informed about the proposed restructure
[296]
8 June 2017 Special Board meeting
[309]
The redundancy
[315]
Post-dismissal events
[322]
22 June 2017 Board meeting
[323]
RETURNING TO THE STATUTE
[333]
Adverse action
[334]
Workplace rights
[337]
ADMITTED WORKPLACE RIGHTS
[343]
Contested workplace rights
[345]
Post-dismissal conduct
[346]
Election-related conduct
[347]
Not complaints or inquiries Ms Shum was “able to make”
[350]
9 November 2016 meeting
[365]
15 February 2017 Letter to the Board
[367]
2 March 2017 email
[369]
Invitation to meeting
[370]
Group stop-bullying application to the FWC
[372]
Complaints to Mr Brooking
[374]
WHY WAS MS SHUM TERMINATED FROM HER EMPLOYMENT?
[380]
The competing hypotheses
[381]
Ms Shum
[381]
Respondents
[387]
The onus of “proving otherwise”
[390]
The corporate mind and scope of the Court’s inquiry
[399]
THE FACTS AND CIRCUMSTANCES LEADING TO DISMISSAL
[413]
The pre-Heeney days
[417]
The engagement of Mr Heeney and the Board’s instructions
[432]
Formulation of the restructure proposal
[449]
Basis of the opinion/belief regarding the financial state of the organisation
[457]
Other sources of information for the decision to make Ms Shum’s position redundant
[476]
Ms Haralambopoulos
[476]
Ms Bindra
[478]
Ms Pollard
[490]
Board members
[494]
Implementation of the restructure and termination of Ms Shum
[496]
The other redundant positions
[499]
Involvement of external lawyers
[500]
DID THE REASONS FOR TERMINATION INCLUDE PROHIBITED REASONS?
[503]
CONCLUSION
[523]
ACCESSORIAL LIABILITY
[535]
Mr Oates
[540]
Mr Heeney
[544]
DISPOSITION
[546]
REASONS FOR JUDGMENT
JUDGE FORBES
SYNOPSIS
The applicant, Ms Lai “Genie” Shum, was employed by Southern Migration Refugee Centre (SMRC) in the position of Team Leader - Finance on a 2-year contract from 21 June 2016. The contract allowed for termination on notice within the two-year period.
The first respondent, SMRC, is a not-for-profit community organisation established in 1993. It is an association incorporated under Victorian law. SMRC provides support services to refugee clients in the southern area of metropolitan Melbourne and is largely government funded. It is governed by a board of volunteers.
The second respondent, Mr Travis Heeney was appointed by the board as the interim managing director of SMRC between 1 May 2017 and 13 October 2017. The third respondent, Mr Brian Oates, is a board member and longstanding chairman of SMRC.
On 30 May 2017 Ms Shum was informed the “Management of SMRC” had decided there would be slight changes to the organisational restructure of SMRC which would potentially result in the redundancy of three positions, one being the Team Leader – Finance position.
On 31 May 2017 the proposed restructure was announced to all staff. The stated reasons for the restructure included enabling the organisation to ensure corporate systems are rigorous and able to respond to challenging needs and to create efficiencies and effectiveness in the organisation and for external service delivery. The decision to restructure was said to have been brought about by “recent events”, the need to build rigour and transparency in critical support areas, the need to channel resources sustainably, to focus on business improvement, to support service delivery in a contemporary manner, to support the long-term viability of the organisation and to position it for any future composition. The reasons were expressed as being in no way a reflection on the quality of work or the commitment of the few affected employees.
Mr Heeney sought to carry out a consultation process with Ms Shum regarding the redundancy of her position, but she refused to engage because she was at that time on personal leave due to stress.
On 19 June 2017 Ms Shum’s employment was terminated. The reason given to Ms Shum was that following the organisational restructure her position was redundant and, as she had not expressed interest in available positions, there were no suitable redeployment opportunities for her.
It would be naïve not to acknowledge the environment in which the present controversy unfolded. I accept the almost universally-held view that SMRC was in a state of turmoil and that its corporate culture was thoroughly toxic in the months prior to Ms Shum’s dismissal. However, as much as Ms Shum would like me to do so, it is beyond this Court’s remit to attribute responsibility for that scenario. These proceedings are not and have never been an occasion for a general investigation or Royal Commission into SMRC.
The evidence revealed that during her relatively short period of employment with SMRC Ms Shum doggedly pursued what she claims were her workplace rights to make complaints and inquiries about her employment and other matters. In addition to more than 40 (and perhaps up to 70 or more) alleged complaints, Ms Shum also initiated proceedings in the Fair Work Commission seeking orders against various board members and managers that they stop bullying her and appeal proceedings against a refusal to accept her Workcover stress claim. Ms Shum also claims that she supported and was involved in anti-bullying actions and complaints initiated by others.
Among Ms Shum’s numerous complaints, many were aimed directly or indirectly at the Chairman of the Board. Ms Shum’s criticism of Mr Oates during her employment and throughout these proceedings was strident and included grave allegations of incompetence, dishonesty, manipulation, bullying and conspiracy to contravene workplace laws. Other targets of Ms Shum’s workplace complaints included allegations against most other members of the SMRC board, the former interim CEO Ms Haralambopoulos, her replacement the interim managing director Mr Heeney, the Human Resources manager Ms Bindra, a subordinate finance team member Ms Wattegamage and others. Prior to the termination of her employment Ms Shum repeatedly alleged that she had been bullied, underpaid, overworked, subjected to an unfair discipline process, improperly contacted whilst on sick leave and denied a range of other rights and entitlements.
Objectively, Ms Shum would have presented as a most difficult and challenging employee for even the most patient of employers. Ms Shum appeared consumed by a sense of injustice and unfair treatment. She also rallied support for the causes of others she believed were aggrieved. The evidence revealed a palpable sense of frustration on the part of her managers and co-workers. Indeed, there were some within SMRC who perceived Ms Shum to be the bully and allegations to that effect were aimed in her direction. But for her dismissal, Ms Shum’s conduct was to have been the subject of a workplace investigation, which may have led to a disciplinary outcome. However, that investigation stalled after Ms Shum complained and decided not to cooperate.
The evidence satisfies me that the finance department in which Ms Shum worked under her manager Mr Lee was dysfunctional, unstable and that the accounts of the organisation were shambolic. There was evidence to support the view that the finance team was inefficient and that Ms Shum and Mr Lee had not provided the board with timely or accurate financial information for months. It is unsurprising that Mr Heeney was drawn to scrutinise the finance department when assessing whether savings could be made and organisational stability restored.
At the time of her dismissal Ms Shum had been absent from work on stress leave for several months. For much of that time she had refused to engage in correspondence or emails with her employer, alleging that communications from management aggravated the bullying behaviours to which she had been subjected and/or compounded her stress symptoms. She claimed not to have received important emails and said they went to her “spam” – evidence I do not accept. Her conduct was in my view belligerent, defiant, provocative and lacked insight into her obligations as an employee. On my assessment of the evidence, by May 2017 Ms Shum had seriously imperilled her employment by creating an unreasonable and unworkable stand-off with management which at some point was bound to come to a head.
Ms Shum has always maintained that she was terminated as retribution for having made complaints and inquiries in relation to her employment. She alleges that the termination of her employment was based on a contrived and carefully orchestrated restructure and a “sham” redundancy process which had as its purpose removing her from the organisation.
In these proceedings Ms Shum advanced, quite literally, a “conspiracy theory” as to why she believes she was dismissed. Ms Shum alleges that the chairman of the board, Mr Oates, and the recently appointed interim managing director, Mr Heeney, acted in concert in making decisions which lead to the termination of her employment. She alleges that they acted with a proscribed purpose which should be imputed to SMRC.
Ms Shum alleges that SMRC contravened the general protections provisions in Part 3-1 of the Fair Work Act 2009 (Cth) (FW Act) by dismissing her for reasons which included her having exercised workplace rights during employment.[1] Ms Shum also alleged that Mr Oates and Mr Heeney were relevantly involved in that contravention within the meaning of s 550 of the FW Act.
[1] Fair Work Act 2009 (Cth) (FW Act) s 340
The question for this court is not whether the respondents terminated Ms Shum vindictively, unfairly or solely as retribution for her complaints. Nor is it necessary to determine whether the organisational restructure was the “sham” Ms Shum alleges or that a conspiracy lay behind it.
In a proceeding under Part 3-1 of the FW Act the determinative question is whether Ms Shum’s dismissal was effected for a prohibited reason or for reasons which included a prohibited reason. In answering this question, it falls to the Court to determine “the actual reason of the decision-maker, in his or her own mind”. The inquiry into the actual reason or reasons of the employer is to be made in the light of all the circumstances established by the evidence.
The legislative scheme affords Ms Shum the benefit of what is commonly referred to as the “reverse onus”. As I explain in more detail later, by operation of ss 360 and 361 of the FW Act, the court must presume that the adverse action was taken for the prohibited reason(s) alleged by Ms Shum unless SMRC “proves otherwise”.
Rebutting the statutory presumption requires the corporate respondent to lead, and for the court to accept, evidence as to why the adverse action was taken. The onus rests with SMRC to persuade the court to the requisite civil standard that the proscribed reasons or circumstances that are alleged by Ms Shum did not factor in any substantial or operative way as a reason for the conduct that she seeks to impugn.
It is often said that proving what did not actuate the action in question, is a task most often discharged by proving what did. The respondents are responsible for constructing the thesis which explains the non-prohibited reasons for their conduct and for leading the evidence necessary to establish it. The task of the court is to consider the plausibility of the presented thesis in light of the evidence as a whole and to decide whether it displaces the statutory presumption.
Here, SMRC says that Ms Shum was terminated as a consequence of a commercially justified organisational restructure, and for no other reason. The respondents identify Mr Heeney as the sole decision maker and say that he alone conceived of the restructure after investigating and assessing SMRC’s organisational structure, business costs and future financial needs. Mr Heeney said that he saw an opportunity to “flatten” the organisational structure and that he identified the role of Team Leader – Finance as unnecessary and inefficient within such a small organisation. The respondents deny that the decision to make the Team Leader – Finance position redundant was influenced by the identity or conduct of its incumbent. The respondents eschew Ms Shum’s conduct or her performance as reasons for the dismissal. Each of the respondents deny that Mr Heeney terminated Ms Shum’s employment because of or for reasons which included her exercise of workplace rights.
The legislation does not require me to reach a state of actual persuasion or reasonable satisfaction that a substantial and operative reason for Ms Shum’s employment was in fact a prohibited reason. That is not the relevant question. The issue for determination in these proceedings is whether SMRC has proved on the balance of probabilities that the reasons for the decision to terminate Ms Shum did not include a prohibited reason.
Based on the evidence adduced at the hearing and for the reasons I develop in this judgment, I am not persuaded that SMRC has discharged that burden. As was the case for the trial judge (Lee J) in Transport Workers’ Union of Australia v Qantas Airways Limited (2021) 308 IR 244 at 325 (TWU v Qantas) this conclusion reflects my unease about the state of the evidence on the critical facts in issue.
Lacunae and inconsistencies in the respondents’ evidence inclines me to the view that Mr Heeney’s decision-making was materially informed, influenced and framed by the views and opinions of others, including Mr Oates, who were actuated by prohibited reasons, namely the history of complaints made and workplace rights exercised by Ms Shum.
The decision-making process produced little documentation and there is little insight, save for his own evidence, into Mr Heeney’s internal machinations. Communications between Mr Heeney and others about the organisational restructure were verbal, to the extent there were any. The corporate decision-making process was opaque and there are few surfaces on which fingerprints can be found.
Mr Oates, as I outline in the judgment, was very well acquainted with Ms Shum’s complaints about him and the board and about his leadership of the organisation. Mr Oates gave evidence that he had been told by Ms Haralambopoulos, the CEO who immediately preceded Mr Heeney, that Ms Shum was “a bit of a problem”. He said he understood why she might have formed that view, and I have no doubt he shared it. Well prior to Mr Heeney’s commencement Ms Bindra was also the subject of complaints and was at the end of her rope with Ms Shum. As was Ms Wattemagame, Ms Shum’s subordinate.
Mr Heeney is an astute and experienced businessman who has been involved in restructuring and redundancy processes in the past. Mr Heeney struck me as an intelligent senior executive who can read a room and intuitively sense the priorities of those to whom he reports. For a man of his experience and acumen, an instruction from the chairman Mr Oates to, among other things, “settle the staff down”, did not require detailed explanation. Once acquainted with historical accounts of recent turbulent events from Mr Oates, other Board members, and Ms Bindra, together with the targeted observations of the “crisis accountant” Ms Pollard and Mr Heeney’s own direct experience of Ms Shum’s complaints and behaviours, the needle of his compass would have instinctively pointed toward Ms Shum and the Finance Team as a (if not the) source of disharmony and conflict within the organisation. These sources of information, almost certainly laden with anecdotes about Ms Shum’s complaints, threats and her problematic behaviour, influenced and infected Mr Heeney’s decision-making with the prohibited reasons of others.
I accept that Mr Heeney had the authority of the board to make decisions in relation to staffing matters. Ms Shum’s attack on that delegated authority has no basis. I also accept that the restructure can be superficially justified as being consistent with the corporate objectives of streamlining, cost-reduction and diverting savings to capital items. However, I am not satisfied that Mr Heeney’s decision-making was (or could ever have realistically been) materially detached from Ms Shum’s reputation and conduct as a persistent and serial complainer and agitator.
In my view, the organisational restructure was developed knowing that Ms Shum was not suitable for or would refuse to express interest in any alternative position – her dismissal was a fait accompli from its conception. For the respondent, the attraction of Mr Heeney’s organisational restructure was the collateral benefit of bringing an end to Ms Shum’s disruptive and challenging conduct. The quiet acquiescence of the board to Mr Heeney’s restructuring proposal spoke loudly.
For the reasons I explain in the judgment, I am not persuaded that Ms Shum’s exercise of workplace rights was not a substantial and operative factor which played into SMRC’s reasons for the decision to make her position redundant. It is by reason of the operation of the statutory scheme that Ms Shum’s application must therefore succeed.
I also find that the second and third respondents were relevantly involved in the first respondent’s contravention within the meaning of s 550 of the FW Act. However, the evidence falls well short of there being a conspiracy between the second and third respondents to inflict harm on Ms Shum as she alleges.
There will be a separate hearing to determine the relief to which Ms Shum should be entitled.
CONTEXT OF THESE PROCEEDINGS
This litigation has a regrettably long and complex history, commencing in this court in 2018. The proceedings have involved multiple parties and an array of alleged contraventions of the FW Act. The respondents have been legally represented by solicitors and counsel and the applicant has represented herself throughout.
The first instance proceeding was heard in the (then) Federal Circuit Court of Australia over eight days during 2019. A significant body of evidence was received by the Court in the form of affidavits, documents and oral testimony. The primary judgment was delivered in February 2020. Ms Shum was partially successful.[2]
[2] Shum v Southern Migrant and Refugee Centre Inc & Ors [2020] FCCA 21
The respondents appealed and the applicant cross-appealed. The appeal also appears to have been a complex and difficult exercise, conducted over two days before Snaden J during 2021. It is not presently necessary to traverse the grounds, suffice to say the respondents were substantially successful and Ms Shum’s cross-appeal was allowed in part.
For the reasons given in Southern Migrant and Refugee Centre Inc v Shum (No 3) [2022] FCA 481, Snaden J set aside the orders of the primary judge and ordered that a new trial be remitted to this Court, on the following confined issues:
(a)whether Southern Migrant and Refugee Centre Inc (SMRC) terminated its employment of Ms Shum in contravention of s 340(1) of the FW Act;
(b)if it did, whether either of Mr Brian Oates or Mr Travis Heeney was (or both of them were), for the purposes of s 550 of the FW Act, involved in that contravention such that he or they might be taken also to have engaged in or committed it;
(c)to the extent that any such contraventions are established, what, if any, relief should be granted in consequence; and
(d)what, if any, relief should be granted in consequence of SMRC having dismissed Ms Shum contrary to the requirements of s 117(2) of the FW Act.
Given the complex issues in this case, the questions of liability and relief have been bifurcated. These reasons deal with remittal issues (a) and (b) only.
THE STATUTORY FRAMEWORK
Issues (a) and (b) of the remittal are to be determined within the “General Protections” framework prescribed in Part 3-1 of chapter 3 of the FW Act.
Section 340(1) of the FW Act precludes “adverse action” being taken by a person against another because, amongst other things, that other person has exercised, or purported to exercise, a workplace right. It provides (relevantly):
340 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.
Section 341(1) defines the circumstances in which a person has a workplace right, including that:
(1) A person has a workplace right if the person:
(a) is entitled to the benefit of, or has a role or responsibility under, a workplace law, workplace instrument or order made by an industrial body; or
(b)is able to initiate, or participate in, a process or proceedings under a workplace law or workplace instrument; or
(c) is able to make a complaint or inquiry:
(i)to a person or body having the capacity under a workplace law to seek compliance with that law or a workplace instrument; or
(ii) if the person is an employee—in relation to his or her employment.
Section 342(1) sets out a table which defines “the circumstances in which a person takes adverse action against another person” (original emphasis). Item 1 in that table provides that adverse action is taken by an employer against an employee if the employer dismissed him or her, injured him or her in his or her employment, altered his or her position to his or her prejudice or discriminated between him or her and other employees.
Sections 360 and 361 facilitates proof by an applicant of a claim of adverse action in two ways.
First, section 360 recognises that some adverse action might be taken for a variety of reasons, including some unrelated to the reasons which Part 3-1 proscribes. Section 360 provides that, for the purposes of Pt 3-1 of the FW Act, “a person takes actions for a particular reason if the reasons for the action include that reason”. Accordingly, an applicant who alleges adverse action will succeed if it is found that a prohibited reason was a substantial and operative reason for the other’s conduct, even if there were also other non-prohibited reasons.
Secondly, section 361(1) creates a rebuttable presumption, expressed as follows:
361 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.
It would be rare if ever possible for an employee to be able to prove the reason or reasons which actuated an employer to do what it did. The purpose of the rebuttable presumption is to throw onto respondents the onus of proving that which is peculiarly within their knowledge.
As applicant, Ms Shum must prove each of the workplace rights, the possession or exercise of which she claims was a reason for the employer’s conduct. She must also prove the “adverse action” relied on – which here is not denied by the respondents. The onus otherwise rests with the respondents.
At the risk of repeating myself, by operation of ss 360 and 361 the court must presume that the adverse action was taken for the prohibited reason(s) alleged by Ms Shum unless the SMRC positively establishes that the action was actuated by a non-prohibited purpose or purposes. In order to “prove otherwise”, SMRC must persuade the court to the requisite civil standard that the exercise of workplace rights by Ms Shum did not factor in any substantial or operative way as a reason for its decision to terminate her employment.
In this case, the first respondent, SMRC is a body corporate. The allegation of unlawful adverse action (the termination of Ms Shum’s employment for a prohibited reason) is directed to it. A corporation has no conscience which is separate from that of its human actors. Because of the presumption in s 361 it is not necessary for Ms Shum to plead the identity of the persons whose states of mind are to be attributed to SMRC.
Where, for the purposes of the Act, it is necessary to establish the state of mind of a body corporate, including a person’s knowledge, intention, opinion, belief or purpose and the reasons for any such intention, opinion, belief or purpose, it is enough to show that, first, the conduct was engaged in by an employee of the body corporate within the scope of his or her actual or apparent authority and, secondly, that the employee had the relevant state of mind: s 793(2).
The statutory presumption and the onus on the employer to discharge it are central to the determination of Ms Shum’s claims. Ms Shum’s allegations against SMRC necessarily involves an exploration of the body corporate’s knowledge, intent and purpose through the state of mind of its human actors including, but not necessarily limited to, the second and third respondents, Mr Heeney and Mr Oates.
Section 550 of the FW Act concerns accessorial liability. It establishes that a person will be taken to have contravened a civil remedy provision if he or she is “involved in” another person’s contravention. A person is “involved in” another’s contravention of a civil remedy provision if (amongst other possibilities) he or she “… has been in any way, by act or omission, directly or indirectly, knowingly concerned in or party to…” the other persons contravention.
ISSUES TO BE DETERMINED
In this remitted proceeding Ms Shum, again presses her allegations that SMRC contravened s 340(1) of the FW Act by taking adverse action against her because of or for reasons which included her possession or exercise of one or more workplace rights. Ms Shum also seeks relief in relation to an unpaid entitlement to notice under s 117 of the FW Act.
Ms Shum seeks compensation for economic and non-economic loss suffered by reason of her dismissal. She also seeks a declaration that SMRC contravened the FW Act and orders for civil penalties to be imposed in respect of the contravention. Ms Shum also seeks relief against Mr Oates and Mr Heeney for their involvement in the prohibited conduct.
After hearing the parties in case management hearings, the issues to be determined emerged fairly clearly. It was not necessary for the rehearing to proceed upon any earlier or amended pleadings. To assist the parties and to provide a “relevance framework”, I fashioned five questions to which evidence and submissions would be directed at the rehearing:
(e)Did the Applicant, during her employment, possess or exercise or propose to exercise any and if so what workplace right/s within the meaning of s 341(1) of the FW Act?
(f)By reference to the workplace rights identified above, what does the Applicant contend were the prohibited reason or reasons for the First Respondent’s termination of her employment? (i.e., what is the Applicant’s hypothesis as to the reason/s for her dismissal?)
(g)Assuming the First Respondent denies that any of those prohibited reasons were reasons for its termination of the Applicant’s employment, what does the First Respondent contend were the reason/s for the Applicant’s dismissal? (ie how does the First Respondent meet the Applicant’s hypothesis?)
(h)If the termination of the Applicant’s employment by the First Respondent was for a prohibited reason or reasons which included a prohibited reason, were Mr Heeney and/or Mr Oates involved in that contravention within the meaning of section 550 of the FW Act?
(i)If the termination of the Applicant’s employment was for a prohibited reason or reasons, what relief does the Applicant seek from the Court?
Each of the parties was invited to file Points of Contention directed to those five questions. They each did so and the competing Points of Contention thereafter acted as a practical form of pleading.
PRE-TRIAL CASE MANAGEMENT
This matter required extensive case management, numerous directions hearings and many interlocutory rulings. Case management was particularly challenging, with frequent disagreements between the parties about substantive and procedural issues.
The hearing was to proceed de novo on the remittal questions and orders were made for the parties to file their evidence-in-chief on affidavit. At their suggestion and in the hope of finding some economy, I permitted the parties to identify and adopt relevant evidence from affidavits read at the first trial. Given the very substantial body of evidence which had been advanced before the primary judge, it seemed to me at the time, but perhaps not now in retrospect, that the adoption of previous affidavits would be an efficient and cost-effective way of bringing the matter to trial. I had anticipated that the parties would file further affidavits only to supplement the evidence previously filed.
Unfortunately, it proved to be otherwise. Much of the evidence in the first proceeding dealt with claims and issues which were not relevant to the remitted case. There were also findings made by the first trial judge about certain purported workplace rights which were adverse to the applicant and not disturbed on appeal. This meant that any reliance on previously filed affidavits had to be screened for relevance.
Arguments about relevance dogged these proceedings from beginning to end. Hundreds of objections were raised by the parties challenging the admissibility of the others’ old and new evidence. The parties were invited to make submissions in support of their respective objections and the court was put to the massive task of ruling upon them. It was a significant and onerous burden, made all the more difficult by Ms Shum’s reticence to work within the confined parameters of the remittal and the respondents’ zealous attempts to keep the case within the narrowest possible guardrails.
There were also contested applications for discovery and for the serving of subpoenas. Again, the area of contest was relevance, with the applicant unprepared to let go of any allegation or argument she believed was of even peripheral relevance to the remittal questions and the respondents giving no ground on what they considered to be the court’s confined role.
Relevantly, on 31 January 2021, I acceded to Ms Shum’s application for the respondents to make discovery on affidavit of, inter alia:
“any documents in their custody, possession or control relating to the Applicant’s dismissal/redundancy on 19 June 2017, including but not limited to the relevant strategies/budgets, confirmed board minutes with relevant attachments and communications between any of Mr Oates/Ms Haralambopoulos/Mr Heeney/Ms Bindra/the Board.”
A number of documents were discovered in response to this order, but not all the documents upon which the respondents ultimately sought to rely. I will deal with this in more detail in due course.
On 6 April 2023 I ordered the parties to file and serve outlines of argument which addressed the remittal questions only. After hearing argument from the parties, I also ordered the respondents to prepare the Court Book for trial, noting that their solicitors had the skills and resources to do so. I considered that a court book prepared by experienced solicitors would facilitate the just disposal of the matter in a timely and efficient manner.
On 18 April 2023, after yet another hotly contested interlocutory hearing, I granted the applicant leave to issue subpoenas to the following persons:
(a)Jacob Lee, a former co-worker of the applicant;
(b)Lynette Keleher (aka Periera), member of the SMRC board and officeholder;
(c)Helen Horvath, member of the SMRC board and officeholder;
(d)Hafez Abdul Wahab, SMRC board member; and
(e)Kelly Pollard, an accountant who provided contract services to SMRC.
Notations to the orders made that day recorded that leave had been granted to issue the subpoenas to Ms Keleher, Mr Wahab and Ms Horvath on the basis that they may be called to give evidence at trial as to the deliberations and decisions of the SMRC board in relation to the termination of Ms Shum’s employment.
The respondents had been ordered to file their evidence by no later than 14 February 2023. However, on 2 May 2023 and relying on the decisions of Alam v National Australia Bank (2021) 288 FCR 301 at [14] (White, O’Callaghan & Colvin JJ); Wong v National Australia Bank (2022) 318 IR 148 at [18]-[26] (Katzman, Charlesworth & O’Sullivan JJ); and Eckel v Ballarat Community Health Ltd [2022] FedCFamC2G 890 at [124]-[143] (Judge Symons) which are referenced and discussed elsewhere in these reasons, the respondents sought leave to file affidavits from the following members of the SMRC board:
(a)Lynette May Pereira affirmed on 28 April 2023;
(b)Ilona Bridget Horvath affirmed on 1 May 2023;
(c)Hafez Abdul Wahab affirmed on 1 May 2023;
(d)Alice Tan affirmed on 1 May 2023;
(e)Ismail Dermiri affirmed on 1 May 2023;
(f)Malik Atif Mahmood affirmed on 1 May 2023; and
(g)Pravin Ramdany affirmed on 1 May 2023.
On 9 May 2023, I granted leave to the respondents to file those affidavits. I asked Ms Shum to inform the respondents’ solicitors of the names of the witnesses the applicant intended to cross-examine. Unsurprisingly, it was all of them.
Document management in this proceeding also proved to be a significant and at times almost overwhelming challenge. A court book and supplementary court book (redacted for evidentiary objections) were produced by the respondent by early May 2023. However, both before and during the proceedings, the applicant sent large volumes of material to my chambers by email, often without clear explanation or leave having been granted. Due to the swirling presence of documents, I instructed the parties to prepare an electronic bundle (tender bundle) of any further documents which were not in the court book but which a party intended to tender in evidence at trial.
THE REMITTAL HEARING
The remittal hearing commenced on 22 May 2023 and initially proceeded over 9 days of evidence. Mr Harrington of counsel appeared for the respondents.
Ms Shum was self-represented in these proceedings as she was at the primary trial and the appeal. Considerable accommodation was made for her inexperience although it must be noted that by the trial she had completed legal studies and had qualified as a solicitor. Ms Shum was more than a mere novice and I expected more discipline from her in the way she ran her case.
Throughout these proceedings the applicant agitated a broad range of allegations and sought to engage with issues which went beyond the remittal questions. Ms Shum sought to re-agitate matters which were found against her in the primary judgment and which had not been disturbed on appeal. She pressed for findings in relation to allegations of adverse action, other than her dismissal from employment. She sought findings and remedies against people who are not parties to the proceeding.
The transcript will reveal the constant objections raised by SMRC’s counsel about the relevance of Ms Shum’s evidence, her meandering cross-examination and her submissions to the Court. Most of these objections had a sound basis. The transcript also records the numerous occasions where the court stepped in to remind the applicant about the nature of the proceedings and the need to refocus her attention on the relevant legal and factual issues to be determined. Judicial intervention in this proceeding was unusually high but unavoidable.
By the conclusion of the trial, the parties agreed that the evidence would comprise:
(a)all affidavits affirmed by a witness at trial;
(b)any documents formally tendered into evidence and marked as an exhibit during trial;
(c)the documents contained in the “Board Minutes folder” which had been produced by the respondents and tendered by consent; and
(d)any other documents which formed part of an agreed “tender bundle”, subject to any objections upon which the court would rule.
After final written submissions were filed in August and September 2023, the respondent was granted leave to reopen their case to adduce further evidence in relation to a discrete matter which had arisen for the first time in the applicant’s reply. This resulted in further hearing days. Final oral submissions were completed in December 2023.
Witnesses
The respective parties filed and, subject to evidentiary rulings, sought to rely on the following affidavits:
Applicant
Deponent Role/position Sworn/affirmed Jacob Lee Former Corporate Services Manager, SMRC 1 Dec 2017 Jacob Lee 8 Aug 2018 Lai Shum Former Team Leader – Finance, SMRC 17 Aug 2018 Lai Shum 12 Oct 2018 Lai Shum 28 Feb 2019 Jacob Lee 6 March 2019 Lai Shum 20 March 2019 Lai Shum 29 April 2019 Jacob Lee 27 May 2019 Jacob Lee 23 Feb 2023 Lai Shum 28 Feb 2023 Lai Shum 5 April 2023 Respondents
Travis Scott Heeney Interim Managing Director, SMRC 21 Sep 2018 Brian Herbert Oates Chairman of the Board, SMRC 21 Sept 2018 Amandeep Bindra Human Resources Advisor, SMRC 21 Sept 2018 Kelly Pollard Contract accountant 20 Sept 2018 Ramesh Kumar Former Chief Executive Officer, SMRC 21 Sept 2018 Ramesh Kumar 14 Feb 2023 Brian Oates 17 Mar 2023 Amandeep Bindra 20 Mar 2023 Travis Heeney 21 Mar 2023 Ramesh Sharma 5 April 2023 Lynette May Pereira Board member, SMRC 28 April 2023 Hafez Abdul Wahab Board member, SMRC 1 May 2023 Ilona Bridget Horvath Board Member, SMRC 1 May 2023 Ismail Demiri Board Member, SMRC 1 May 2023 Malik Atif Mahmood Board Member, SMRC 1 May 2023 Pravin Ramdany Board Member, SMRC 1 May 2023 Alice Tan Board Member, SMRC 1 May 2023 Travis Heeney 27 Oct 2023 Rakesh Sharma 27 Oct 2023 Dramatis Personae
These reasons will be better understood if I clarify, by name and role, the many individuals who gave evidence or were otherwise mentioned in the parties’ affidavits. Explaining the relationships between these individuals assists to understand the context in which the dispute arose and how the evidence is to be assessed.
·Ms Lai “Genie” Shum, the applicant. Former Team Leader – Finance from 21 June 2016 until her termination on 19 June 2017
·Mr Travis Heeney, the second respondent. Interim managing director of SMRC between 1 May 2017 and 13 October 2017
·Mr Brian Oates, the third respondent. Chairman of SMRC since November 2010, most recently re-elected December 2016
·Ms Jenny Semple, long serving CEO for approximately 20 years until she took leave in 2016 from which she never returned
·Ms Despina Haralambopoulos, acting CEO after Ms Semple took leave in 2016 until Mr Heeney’s appointment as interim managing director in May 2017
·Ms Lynette Periera (aka Keleher), elected board member and Secretary of SMRC
·Ms Ilona (Helen) Horvath, elected board member and Treasurer of SMRC
·Mr Pravin Ramdany, appointed board member at December 2016 AGM and assistant treasurer
·Ms Alice Tan (Lau), appointed board member in March 2017
·Mr Hafez Wahab, elected board member
·Mr Ismail Demiri, elected board member
·Mr Malik Mahmood, elected board member
·Mr Ramesh Kumar, CEO from 2018 to 2022
·Mr Rakesh Sharma, Director Corporate Services from October 2017, then CEO from November 2022
·Ms Amandeep Bindra, SMRC Human Resources Advisor from about June 2015 until November 2017
·Mr Jacob Lee, Corporate Services Manager and Ms Shum’s immediate manager. Resigned August 2017
·Ms Kate Lord, former Quality & Risk Adviser and Acting Programs Manager. Redundant 19 June 2017
·Ms Kerry Pollard, contracted “crisis accountant” engaged by SMRC board in March 2017
·Ms Champa Wattegamage, Assistant Finance Officer reporting to team leader Ms Shum
·Ms Perla Mazie, Bookkeeper reporting to team leader Ms Shum
·Mr Christopher Brooking, former Business Development manager. Redundant 19 June 2017
·Mr Bill Collopy, Manager Diverse Care
·Ms Sandra D’Souza, Executive Assistant to the CEO
Some comments about credit
In final submissions, both parties made general observations disparaging of the credit of the others’ witnesses. Some of the criticisms have substance, but in this case I must make allowance for the fact that the impugned events occurred many years ago and not all witnesses were as close to the action as others.
It is well to remember that a court should be cautious before making adverse credit findings which rely to any significant extent on demeanour. The witness box is not the most natural environment, particularly for those who are reluctant participants in what they perceive to be someone else’s dispute. The hurly-burly of cross examination and attacks on one’s recollection or motives is prone to cause even the most calm individual to rankle. Conversely, with enough preparation and confidence, even the most disingenuous can present as calm and creditworthy.
The evidence in chief was given on affidavit. Both parties relied on affidavits which had been produced for the initial proceeding in this court which, by the time of the remittal proceeding, were several years old. More recent affidavits were prepared on memories which had faded or had been refreshed by reference to selective documentation. The affidavit evidence of the respondent’s principal witnesses spoke at a high level of generality and did not give any real insight into the decision-making processes or the deponents’ states of mind.
The affidavits filed on behalf of directors shortly prior to trial and their subsequent cross-examination were particularly illuminating. The affidavits were prepared in a common format with each witness denying any substantive involvement in the decision-making. The affidavits simply adopted the minutes of board meetings as being an accurate record of events, but none of the witnesses persuaded me that they had a true independent recollection of what occurred. Given the formulaic approach to those affidavits, I found this evidence to be fashioned to support the respondent’s preferred narrative.
The court only observed witnesses under the glare of cross-examination. The witnesses were predictably partisan to the party which called them. Ms Shum was a passionate advocate for her own cause and she embraced cross-examination as another opportunity to press her narrative. As mentioned earlier, Ms Shum seems consumed by a deep sense of injustice and she brought that demeanour to these proceedings. She was suspicious of the cross-examiner and frequently argumentative when questioned, attempting to anticipate what was coming rather than answer what was asked. Her evidence was strongly coloured by her own perspective and exaggerated for effect. Where documents exist to record Ms Shum’s interactions with others, I prefer that record to her more recent account of events.
Ms Shum’s other witness, Mr Lee, presented as an embittered fellow traveller, with his own axe to grind about his time at SMRC. I found him to be generally credible although his evidence was brief and ultimately of marginal relevance.
The respondents’ witnesses all responded to cross-examination at a high level of generality. For many of the board members, their memory of Ms Shum and the events of 2017, including the organisational restructure, was poor or even non-existent. A number of the older and longer serving board members emphasised their role as volunteers and saw their role on the board as being entirely divorced from operational matters, those being responsibilities entrusted to the CEO of the day. The common theme across the evidence given by those board members was a distinct lack of any recollection of matters relating to staff, finances, management and the like.
As the evidence emerged it became apparent that some board members were far more actively involved and engaged with the operational arm of the business than others. The Chairman Mr Oates, the Secretary, Ms Periera and the Treasurer, Ms Horvath were all identified as being the board members who regularly engaged with the CEO’s of the day. In a sense these persons were regarded as the professional directors and they were entrusted by other board members to oversee the CEO’s management of the business.
There was a distinct contrast between what I describe as the non-active board members and those who occupied executive office. The Chairman, Treasurer and Secretary proved to be close associates and well known to each other through, for example, their involvement in a local Residents Association, of which Mr Oates was the president. These key members of the executive board seemed much more invested in the proceedings. Each of them, to a greater or lesser degree, were reluctant witnesses, abrupt in the witness box and seemed particularly affronted by Ms Shum’s allegations of bullying and dismissive of this litigation more generally.
That said, the length and breadth of cross examination and the manner in which the trial was conducted by Ms Shum often caused tensions to escalate. I make allowance for the fact that witnesses for the respondents were probably not at their best when confronted with meandering and unstructured questioning which had the natural effect of causing defensiveness and self-justification. More targeted and effective cross-examination on relevant issues would have been of greater assistance.
Where other comments regarding the credit of individual witnesses are warranted, including Mr Heeney, I express my observations throughout the course of these reasons.
BACKGROUND FACTS
There are few agreed facts in this case. The parties give very different narratives, each representing their own perspective on the same events. There are many factual contests and inconsistencies in the evidence, compounded by fading recollections and a deficit of contemporaneous documentation.
In this judgment it is simply not possible to refer to every piece of evidence the parties have relied upon or to address every argument raised by them. The following narrative represents an amalgam of what I understand to be agreed facts, uncontroversial or uncontested evidence and my findings in relation to relevant contested matters. Where it has been necessary to resolve an inconsistency or conflict in the evidence, I will explain how I have done so.
SMRC is governed by a board of directors, each of whom is a volunteer. The majority of the Board of 11 is elected by the 200 or so members of SMRC and the constitution makes provision for appointments to the Board. The Board is responsible for the governance of the organisation and the employment of a chief executive who oversees management and operations.
In 2017 SMRC had a workforce of about 60 permanent employees and around 150 volunteers who between them spoke more than 60 languages. The organisation provided a range of services to migrants including community support, settlement assistance, aged care services and access to social enterprises and participation.
Mr Oates has been the chairman of the board for many years. He is a former trade union official and municipal councillor. Mr Oates first joined the board of SMRC in 1998, the same year he became a member. He was elected as chairman in 2010 and relevantly remained in that position throughout the period of Ms Shum’s employment.
Mr Oates gave evidence that the constitution of SMRC was amended in 2014 to introduce a new category of membership: associate member, which included SMRC volunteers and employees. He said that the distinction between financial members and associate members was introduced to ensure there was no real or perceived conflict of interest by preventing employees from being both. Mr Oates also gave evidence about another amendment in 2016 which set limitations on the period for which a person could serve on the board.
For the purposes of this judgment the story commences in June 2016, when Ms Shum accepted employment in the position of Team Leader – Finance. She had previously performed some part-time work in a locum capacity at SMRC, but her full-time appointment commenced in June. In her role as Team Leader, she reported to Mr Jacob Lee, the Corporate Services Manager, a long-time employee of SMRC. As team leader, Ms Shum supervised the Assistant Finance Officer, Ms Champa Wattegamage and the Bookkeeper, Ms Perla Mazie.
It is not disputed that late 2016 saw a period of significant instability and dysfunction within the governance of SMRC and its workplace. SMRC was riven with conflict and internecine disputes between its Board, its then CEO Ms Jenny Semple and members of executive management.
Mr Oates gave evidence that the board was concerned about the financial performance of SMRC as it had lost almost $400,000 over four years and was in a “precarious financial position”. He said that from 2015 a newly constituted board started to take a more active approach to addressing these longstanding financial issues.
The CEO, Ms Semple, had held her position for nearly 20 years. However, by late 2016, for reasons which need not be explored, Ms Semple had fallen out of favour with the board and had been absent from the organisation for several months. Mr Lee and others gave evidence that the workplace became stressful after staff became aware of the conflict between Mr Oates and Ms Semple. The evidence makes plain that a good number of the SMRC staff were very loyal to the long-serving Ms Semple and her absence was disconcerting to them.
In October 2016 Mr Oates sent an email to SMRC staff notifying them of a board resolution to appoint Ms Despina Haralambopoulos as Acting CEO. There then followed a series of urgent board and staff meetings to manage the operational and governance ramifications of this decision.
In this turbulent period, a cloud of chaotic and bitter internal disputation enveloped SMRC and its leadership. Employees were drawn into or involved themselves in this disputation and sought to influence a change in the leadership of SMRC. More than 25 new members joined the organisation, many of whom were employees including Ms Shum. Mr Oates sensed a coup. The issue of membership and voting rights set the board and the new members on a collision course.
Loyalties were divided between those who supported long standing management and those who sought change. Employees (in particular the SMRC Executive Management Team) and the board sat on either side of the divide, each group expressing no-confidence in the other. There was significant staff unrest. The description of the workplace as toxic was adopted by many witnesses in this proceeding.
This dysfunctional workplace was the environment from which Ms Shum claims to have exercised the first in a series of workplace rights. Ms Shum alleges that the exercise of those workplace rights or a combination of them was a substantial and operative reason for SMRC’s decision to terminate her employment in the coming months.
Mr Oates gave evidence that on 7 November 2016 he wrote to new members on behalf of the board informing them that the Constitution prevented them from voting at the forthcoming Annual General Meeting. This letter caused apparently consternation among those who had recently joined the organisation as members. Ms Shum claims that at a meeting on 9 November 2016 to discuss the board’s letter, she inquired of Mr Oates whether there was evidence to support the board’s investigation into Ms Semple’s remuneration. Ms Shum contends that this enquiry by her constituted the exercise of a workplace right pursuant to s 341(1)(c)(ii).
Mr Oates gave evidence that in early November 2016, when the board was preparing correspondence to SMRC members about the forthcoming AGM, he noticed that Ms Shum’s name was on the mailing list of members. Mr Oates says he recognised the applicant’s name because she had previously emailed him regarding online banking in her capacity as Team Leader-Finance. He said the thought occurred to him at that time that Ms Shum must be simultaneously both an employee of SMRC and a financial member of the organisation. However, he denies having any direct contact with her or any other knowledge about her.
On 24 November 2016 Mr Oates met with the SMRC Management Executive to discuss their concerns about the board’s correspondence with the 26 new members. It appears that this meeting had been requested by management to express concerns about ongoing staff unrest and to seek clarification regarding voting rights prior to the forthcoming AGM.
In a letter sent later that day under the hand of “Acting CEO and the Managers of SMRC” the authors claim that the board had circulated misleading information, that there was a disconnect between the board’s communication and its interpretation by staff and that the content of the board’s letter might be considered defamatory. Mr Oates understood that letter to have come from the acting CEO Ms Haralambopoulos and her management team.
On 1 December 2016, the day of the AGM, a document headed “An open letter to the Members of the SMRC from concerned Staff” was produced and circulated amongst those who attended the AGM. The document, which was not signed and has no identifiable author, purported to be written on behalf of “24 staff and associate members of the SMRC”. The document asserted that the chairperson, Mr Oates, had lost the respect and support of those behind the letter, who also expressed a lack of confidence in him and a fear that under his leadership the future of SMRC was threatened. The so-called open letter encouraged recipients to use their vote wisely “to put the right people, people with integrity on the board, we have confidence in”. Ms Shum claims to have voted to support this letter, which she also claims to be an exercise of her workplace rights pursuant to s 341(1)(c)(ii).
The AGM itself was a rowdy affair, given the testy internal politics. The band of supporters loyal to the long serving CEO Ms Semple voiced their opposition. Mr Oates said the meeting descended into farce.
Relevantly, Mr Oates gave evidence that he recalls Ms Shum placing her vote for the election of the board in the ballot box at the AGM. In cross-examination Mr Oates recalled that, “Ms Shum came up and in front of me, made sure that I saw that she put her vote in the box”. Mr Oates gave evidence that this was the first time he had any direct or personal involvement with Ms Shum – although he conceded that he had dealt with her in relation to cheque signing previously.
At the AGM, Mr Oates was re-elected to the board as were others on his “Migrant Team” ticket. After the election the new board established an executive committee consisting of:
(a)Brian Oates - Chairperson
(b)Hafez Abdul Wahab - Deputy chairperson
(c)Helen Horvath - Treasurer
(d)Nazer Nazir - Assistant Treasurer
(e)Lynette Keleher - Secretary
(f)Malik Atif Mahmood – Assistant Secretary
A few days after the AGM, on 5 December 2016, the acting CEO Ms Haralambopoulos asked Ms Shum to a meeting in her office. Ms Shum described this as a “non-work” meeting at which Mr Oates and another board member Mr Abdul Wahab were present. Ms Shum alleges and Mr Oates admits that he told her that she should not have voted at the AGM on 1 December 2016 because she had a conflict of interest as a current employee of SMRC. Ms Shum alleges that she objected to that allegation and by doing so exercised a workplace right pursuant to s 341(1)(c)(ii).
Mr Oates gave a different version of the meeting. He said he needed to take another person with him because the board was concerned that some members of the staff might be violent to him if he walked in on his own. Ms Shum was brought into the meeting and Mr Oates said that Ms Shum’s involvement “was a setup”. Mr Oates agrees he challenged Ms Shum about her associate membership and a conflict-of-interest. Mr Oates gave evidence that Ms Shum was very very aggressive to him and that she made it quite plain that she opposed him and his board.
Ms Shum alleges that immediately after the meeting with Ms Haralambopoulos, Mr Oates and Mr Wahab on 5 December 2016, she complained to her manager, Mr Jacob Lee about being intimidated in the workplace during office hours in relation to her private business, namely her voting rights as a member of SMRC. Again, Ms Shum alleges that in making that complaint to Mr Lee, she exercised a workplace right.
There is evidence that in mid and late December 2016, Ms Haralambopoulos sent broadcast emails to “[email protected]” inviting them to informal morning tea get-togethers to touch base about the recent challenging times. Ms Shum asserts that she attended a few of these sessions where she enquired about staff voting rights and whether there was a code of conduct for Mr Oates and the board. Ms Shum alleges that her participation in these informal get-togethers constituted the exercise of a workplace right.
On 7 January 2017, Mr Oates emailed casual members of SMRC noting that some had requested a Special General Meeting. The proposed motion for the SGM was that current board members be expelled. In his correspondence, Mr Oates informed financial members that those who were paid staff members would not be able to vote at the meeting and should not take any part in any campaigning.
On 8 January 2017, Ms Shum forwarded Mr Oates’ email to her colleague and manager Mr Lee with the message “FYI”. Ms Shum alleges that by sending this email to Mr Lee she exercised a workplace right.
On 9 January 2017 the interim CEO, Ms Haralambopoulos, emailed Ms Shum informing her that she would be happy to meet to discuss Ms Shum’s concerns about Mr Oates’ correspondence of 7 January 2017. Ms Shum alleges that in a meeting later that day, Ms Haralambopoulos tried to cancel her financial membership and provide a refund. Ms Shum claims to have objected to this and asserts, by doing so, she exercised a workplace right pursuant to s 341(1)(c)(ii).
The tensions between staff and the board continued throughout January 2017 and beyond.
On 25 January 2017 the board and members of staff attended a mediation which was facilitated by an external agency. Ms Shum attended that meeting as a Team Leader, as did various other SMRC managers and the acting CEO. Ms Shum says that she complained about Mr Oates conduct during that meeting, although the formal record of the discussion does not attribute any particular complaint to her.
On 27 January 2017 the Special General Meeting took place to consider a motion to expel five board members, namely Mr Oates, Ms Horvath, Mr Demiri, Mr Wahab and Mr Wickiramasingham. Ms Shum says that she participated in staff discussions with a manager, Mr Brooking, who spoke on behalf of staff at the meeting. Ms Shum contends that her participation in these background staff discussions should be regarded as an exercise by her of a workplace right within the meaning of the FW Act.
The staff push to roll Mr Oates and other members of the newly elected board was unsuccessful. Mr Oates remained as chairperson and the board remained intact.
On 2 February 2017 Ms Shum took leave to visit a GP and a psychologist. Upon her return from leave, Ms Shum claims to have told her immediate finance team members, Mr Lee, Ms Maisie and Ms Wattegamage that her absence was due to work stress.
On 15 February 2017 a group of eight members of the SMRC management team sent a jointly signed letter to the board expressing various grievances and seeking a response. In its terms, the letter commenced as follows:
“On behalf of the majority of SMRC staff, we as members of the Management Team wish to express grave concerns about (i) the conduct of our current Chairperson (ii) his handling of recent events and (iii) the impact of his actions on the future of this organisation. We present this letter on behalf of staff who are not named, to protect them from further intimidation.”
The letter goes on to catalogue a series of allegations against Mr Oates under the headings “Distributing misleading and false information”, “Damage to the reputation of the SMRC and its CEO, Jenny Semple” and “Bullying and intimidating behaviour towards some staff”. The letter then concludes:
“Accordingly, we believe Brian Oates is unfit to be Chairperson of SMRC. The majority of our staff feel at risk of being bullied and intimidated by his actions and statements. We believe the Board should take immediate steps to address these concerns, in accordance with the Fair Work Act 2009. We the signatories are exercising our rights to raise concerns about unprofessional and potentially unlawful conduct by the Chairperson. We are protected against adverse action or threats of further intimidation, in accordance with the Fair Work Act 2009.
We request a meeting within 5 business days of the date of this letter, with a view to the Board seeking the immediate removal of Brian Oates as Chairperson and as a member of the SMRC Board”
The letter, which was also copied to the acting CEO, was signed by Kate Lord, Chris Brooking, Jacob Lee, Bill Collopy, Aman Bindra, Peter Jarrett, Sylvia Wan and Wendy Fox, all of whom held management positions. Ms Shum was not mentioned in the letter, nor was she a signatory. Nonetheless, she claims to have been “supportive” of the letter and to have provided input. Ms Shum claims that this support and input should be construed as an exercise by her of workplace rights.
Two days later, on 17 February 2017, Ms Shum’s manager, Mr Jacob Lee, commenced a period of sick leave but he maintained contact with Ms Shum and Ms Wattegamage for a period whilst he was on leave. Some months after commencing this sick leave Mr Lee informed the then interim managing director that he could not return to the organisation while Mr Oates remained the chairperson. Mr Lee never returned to the office.
After Mr Lee commenced sick leave on 17 February 2017 Ms Shum, as Team Leader, was left as the most senior person in the Finance office. She effectively reported to the acting CEO Ms Haralambopoulos from that time.
On 28 February 2017 Ms Shum held a meeting with her remaining finance team members, Ms Wattegamage and Ms Mazie. It did not go well. An email sent to Ms Wattegamage the following day (1 March 2017) reveals that Ms Shum was unhappy with Ms Wattegame’s performance and behaviour. Ms Shum was most unimpressed that Ms Wattegamage had gone over her head and elevated certain financial operations issues to the acting CEO Ms Haralambopoulos, rather than resolving them within the Finance Office. Ms Shum was also unhappy that Ms Wattegamage had failed to respect the meeting and walked off.
The email to Ms Wattegamage did not hide Ms Shum’s displeasure. According to a timeline prepared by Ms Shum, it appears that Ms Wattegamage marched off to the CEO’s office to complain about Ms Shum’s email. Ms Wattegamge then complained about chest pains and was advised by Ms Haralambopoulos to take the rest of the day off.
On 2 March 2017 there were two events of significance. First thing in the morning, Ms Shum emailed Ms Haralambopoulos to inform her that Ms Wattegamage was still sick and would not be in for the following two days. She went on to inform the Acting CEO that that both Ms Wattegamage and Ms Perla Mazie had mentioned taking sick leave. Ms Shum stated that she could not do the work of the whole team and asked for this circumstance to be considered as a risk management issue.
Secondly, later that day, Ms Shum emailed Ms Haralambopoulos to report on Ms Wattegamage’s insubordinate conduct. Ms Shum said that the Finance team was under immense stress and pressure due to Mr Lee’s absence and that she was required to do more than she had previously. In relation to the others in the Finance Office, Ms Shum said, inter alia:
“According to the PD of Champa (as well as Perla), I am their immediate supervisor. According to mine, I report directly to Jacob. The chain of command is not upheld now. I am happy for you to look after Jacob’s jobs for the Finance Team. I have no issues for you to directly supervise them without involving me. However, I do not have the duty to accept the refusal of lawful instructions from a subordinate in a rude manner.”
On 3 March 2017 the popular former CEO, Ms Jenny Semple, resigned. She had been with the organisation for approximately 20 years although the last 6 months were on sick leave.
That same day, 3 March 2017, Ms Shum took sick leave. A medical certificate tendered in evidence certifies that Ms Shum had a “medical condition” that day, however she claims that the leave was due to overwork and stress.
On 6 March 2017 Ms Haralambopoulos asked Ms Shum into a meeting at about 3:15 PM where she was handed a letter regarding a complaint Ms Wattegamage had made against her. The complaint related to Ms Shum’s conduct as team leader at the finance meeting on 28 February 2017. Ms Wattegamage alleged that Ms Shum had:
(a)acted in an angry, aggressive and intimidating manner;
(b)restricted staff from reaching out to the Acting CEO; and
(c)engaged in aggressive and intimidating communication in direct conflict with the SMRC code of conduct and the Work, Health and Safety Act.
Ms Haralambopoulos’ letter directed Ms Shum to attend a formal disciplinary meeting at 2:30 PM on 8 March 2017, a meeting which would be conducted by Ms Haralambopoulos and the human resources manager Ms Aman Bindra. The letter goes on to explain that the complaint should remain confidential, that Ms Shum was at liberty to seek advice and representation and that the outcome of the meeting might result in disciplinary action. Ms Shum alleges she exercised a workplace right when she denied the allegations on the spot and challenged the procedure which was to follow.
A short time later, Ms Shum sent two emails to Ms Haralambopoulos. The first requested a copy of the SMRC complaints handling procedure. The second requested a copy of any emails which Ms Wattegamage had attached to her complaint and details of any other evidence or witnesses to the allegations. Ms Shum relies upon each of these emails as evidence of her exercising workplace rights.
A few minutes later, at 4:26 PM, Ms Shum emailed the CEO and the human resources manager, Ms Bindra, to initiate a formal counter-complaint against Ms Wattegamage, citing her rude manners and insubordination. Ms Shum says in doing so she exercised a workplace right.
The next day, 7 March 2017, Ms Shum lodged a WorkCover claim and commenced a period of leave. In her WorkCover claim application, Ms Shum stated:
“a. The injury/condition includes head, neck, shoulder,….Headaches, neck and shoulder pain, palpitation, anxiety, depression, insomnia, anger
b. Causes of injury include:
i. Ongoing bullying from Board to many staff since Oct 2016;
ii. personally, the applicant was bullied as a financial member and staff member;
iii. the Applicant boss on stress leave for more than 2 weeks and causing an overload of work in addition to bullying;
iv. environment hazardous to health.”
After lodging her Workcover claim and commencing leave on 7 March 2017, Ms Shum did not return to the workplace or perform further work for SMRC. The disciplinary meeting which had been scheduled for 8 March 2017 did not go ahead.
On 9 March 2017, the chairman Mr Oates sent an email to the acting CEO Ms Haralambopoulos under the heading “Matters from this morning CONFIDENTIAL”. The email was copied to all members of the SMRC board. Relevantly, Mr Oates’ email commences as follows:
“Despina,
As I understand this morning we agreed that the priority is to finalise and lodge WorkCover claims.
The priority is Jacob [Lee] his claim will be rejected by SMRC on the grounds that there is a claim, from the Board, that he should be subject to discipline and that both that and a previous complaint that Jacob has made are subject to an agreed process that is underway. Further he has provided no evidence to support this latest claim.
With Genie [Shum] this claim will be rejected by the SMRC on the grounds that she was asked to attend a meeting on a discipline matter just before she went on personal leave and made the claim.
There is also, at the same time, the need to communicate with Jacob the need to access the SMRC’s financial accounts on his computer and the passwords are required to do this. If there is no response to the request for communication we will need to force access to ensure the continued viability of the organisation.”
I infer that the email recorded action items agreed in a meeting or discussion between Mr Oates and Ms Haralambopoulos earlier that morning. The email from Mr Oates goes on to deal with a number of other matters including finalising the former CEO’s (Ms Semple’s) pay and communicating with staff about a planned farewell function. Mr Oates also states that he will continue to come into the office to sign cheques and conduct online banking in the finance section area. He directs that if any staff raise questions about governance matters they should talk to him or another board member.
On 15 March 2017, Ms Haralambopoulos filed an employer’s response to Ms Shum’s WorkCover claim. In that response she states, consistent with Mr Oates’ direction, that “we are disputing the claim based on the grounds that likely reason for claim is performance management action taken on 6/3/17. There has been no prior evidence of being bullied.”
That evening, after receiving confirmation that her WorkCover complaint had been lodged, Ms Shum sent an email to the HR manager Ms Bindra, copied to Ms Haralambopoulos and Ms Shum’s manager, Jacob Lee (who it will be recalled was also absent on stress leave). In that email Ms Shum states that an employer has to pay the first 2 weeks of wages under WorkCover and will face consequences if it does not do so. Ms Shum states that all communications regarding her WorkCover should be sent to her private email address and that “any authorised representatives can communicate with me for business purposes”. Ms Shum adds that she has an outstanding request for documents regarding her complaint against Ms Wattegamage and Ms Wattegamge’s complaint against her. Ms Shum alleges that this enquiry about her WorkCover pay and the disciplinary process constituted the exercise of a workplace right.
On the morning of 16 March 2017, Ms Shum sent a further email to Ms Bindra which she again copied to Ms Haralambopoulos and Mr Lee. In that email Ms Shum asserted:
“Hi Aman,
Further to my injury since 2/3/17 (as stated on my WorkCover claim), I would like to lodge a formal complaint against SMRC in bullying me on the following grounds:
1 Ongoing bullying from the board (chaired by Brian Oates) to most staff (including myself) since Oct 2016 including numerous insulting correspondences and duress.
2 Personally, I have been bullied as a financial member and a staff by the Board under duress in retaliation to my exercising the voting rights.
3 On top of bullying, my boss was on stress leave for 2 weeks and I was forced to overwork by taking up the duties of my boss, myself and my subordinate on 2/3/17, causing my injury to blow up.
4 Subsequent to my injury on 2/3/17, upon my return to work on 6/3/17, I was bullied by the acting CEO (Despina) with a complaint (false statement) from my subordinate (Champa). Without investigating or confirming the facts with me, this been pushed a letter to me asking for disciplinary action on 8/3/17 with short notice. She ignored me. I asked for a copy of the complaints procedures, substantiating emails, witness and evidence. To date, SMRC still ignores me.
5 I lodged a formal complaint against Champa on 9/3/17 but again, I have been ignored. SMRC cannot provide any complaints procedures and handle complaints with discrimination.
I have loads of bullying evidence (which you are well aware of and should have already had copies) and I am happy to send you a copy.” (Underlining in original)
On 16 March 2017 at 5.30 PM there was a board meeting. At this point I briefly digress from the narrative.
An aside - Board minutes and other “contemporaneous” documents
In this remittal hearing the respondents tendered a folder of board minutes which they rely upon as a contemporaneous record of what occurred at various board meetings in 2017. In his written final submissions, counsel for the respondents said that these board minutes “told their own story”, albeit in summary form.
The board minutes were not produced as a single bundle and additional documents were added during the retrial. By the end of the trial, the tendered Board Minutes folder comprised the following documents behind numbered tabs:
(1)Minutes of Board of Directors Meeting 16 March 2017
(2)Minutes of urgent Board Meeting 23 March 2017
(3)Minutes of Board meeting 30 March 2017
(4)Minutes of Special Board meeting 11 April 2017
(5)Minutes of Board meeting 20 April 2017
(6)Draft Minutes of Board Special meeting 10 May 2017
(7)Minutes of Board meeting 10 May 2017
(8)Minutes of Board meeting 18 May 2017
(9)Managing Director Report-Board meeting 18 May 2017
(10)Draft Minutes of Special Budget Meeting 8 June 2017
(11)Minutes of Board Meeting 22 June 2017
The respondents submit that the simultaneous redundancy of Ms Lord and Mr Brooking should be seen as a complete answer to Ms Shum’s allegation that the organisational restructure was a sham process designed to remove her. The respondents submit that the redundancy of these other employees is entirely consistent with their case that there were genuine reasons for organisational restructure and that there is no substance to Ms Shum’s conspiracy theory. In relation to that submission I make the following observations:
(a) I accept that the termination of Ms Lord and Mr Brooking forms part of the matrix of facts and circumstances which must be taken into account in assessing the reasons advanced by SMRC for the termination of Ms Shum;
(b) save for the reasoning advanced in Mr Heeney’s correspondence to Ms Lord and Mr Brooking advising them of the reorganisation, there is no documentary or other probative evidence before the court as to why they were identified for redundancy ahead of others. The decision seems to have been a judgment made by Mr Heeney. In any event it is not necessary for Ms Shum to prove or for the court to find that either employee was terminated for prohibited reasons;
(c) in the context of considering all the facts and circumstances, it will be recalled that both Ms Lord and Mr Brooking were authors (together with other managers Bill Collopy, Aman Bindra, Sylvia Wan, Peter Jarrett and Wendy Fox) of an application to the Fair Work Commission on 17 March 2017 which sought to enliven the Commission’s jurisdiction to make a “Stop Bullying” order. The letter which accompanied the application expressed anxiety and distress regarding the alleged “repeated bullying and intimidation by the chairperson of the board”
(d) Mr Brooking was the ally who Ms Shum put forward to SMRC as the person to whom communications about her employment should be directed whilst she was on stress leave. Although Ms Haralambopoulos initially approved Mr Brooking to be Ms Shum’s nominated recipient, that arrangement was later challenged after Mr Heeney’s appointment;
(e) following her dismissal, Ms Lord commenced unfair dismissal proceedings against SMRC. The merit of her challenge is unknown and it resulted in a confidential settlement between those parties;
(f) even if the court accepts that Ms Lord and Mr Brooking were dismissed for entirely for non-prohibitive reasons, that finding would only lend contextual weight to the respondents’ case. Such a finding could not of itself exclude, in Ms Shum’s case, the operation of prohibitive reasons.
Involvement of external lawyers
It is an objective fact that at or about the time of the restructure and the decision to terminate Ms Shum’s employment SMRC engaged an external law firm to provide legal advice. When asked why during cross-examination, Mr Heeney said that it was to provide advice about the legal requirements of the restructure process. Ms Shum, on the other hand, would have the court draw an inference that the engagement of lawyers was, at the very least, indicative of the respondents subjective awareness that her exercise of workplace rights presented a risk factor in the decision-making. The maintenance of a claim of legal professional privilege over communications between SMRC and its legal advisers only reinforced Ms Shum’s belief.
Mr Oates gave evidence that he saw the restructure as a straightforward decision which did not draw any comment from the board. SMRC also had internal human resources expertise to draw upon. Communications to staff and Ms Shum described the restructure as a “slight change”. When viewed in that context, it does strike one as intuitively odd that a law firm, with specialist expertise in employment and industrial relations, would be engaged to shepherd the organisation through such a benign process.
Nonetheless, the Court must be careful not to make too much of the fact that an organisation seeks legal advice in relation to important employment decisions. Involuntary dismissals, such as those occasioned by redundancy, are subject to the provisions of the Fair Work Act and other industrial instruments. It is not uncommon for an organisation to turn to lawyers for expert legal advice in relation to workplace obligations and potential areas of risk and liability. A perception of risk about such a decision cannot lead to an inference, without more, that a prohibited reason is being concealed.
DID THE REASONS FOR TERMINATION INCLUDE PROHIBITED REASONS?
By reason of s 361 of the FW Act the exercise of workplace rights by Ms Shum is presumed to be a reason for the adverse action unless SMRC proves otherwise.
The respondents in this case have built their narrative around the premise that Mr Heeney and Mr Heeney alone, insulated from the board and management, deliberated upon and conceived of the restructure which resulted in Ms Shum’s dismissal. SMRC presents Mr Heeney as being entirely agnostic as to which personnel or departments would be effected by the restructure – his sole focus being to stem the financial crisis, improve efficiencies and restore stability to the organisation.
The respondents contend that Mr Heeney was the sole decision-maker and that no other person, be it the chairperson, a board member, another SMRC manager, employee or other person contributed to Mr Heeney’s decision-making in any material way. This controversy was presented by the respondents as a straightforward case of one decision made by one man which should turn simply on whether the evidence given by the decision-maker is accepted.
I am not persuaded by that narrative and I do not accept that Mr Heeney’s decision-making was as insulated as the respondents would have me believe. SMRC’s decision to terminate Ms Shum’s employment cannot be assessed in a vacuum. Mr Heeney’s evidence about the organisational restructure and the redundancy of Ms Shum’s position cannot be assessed as though the final step in decision-making can be divorced from what preceded it. The circumstances leading up to and surrounding the impugned decision are contextually important.
The background narrative which I have set out in deliberate detail invites inquiry into whether SMRC’s state of mind was that of Mr Heeney alone or in truth the expression of others.
As Snaden J recently remarked in Pilbrow v University of Melbourne [2024] FCA 1140 (and despite his Honour’s previously expressed reservations), the Courts have in recent years breathed life back into the notion that “unconscious” influences might be relevant in assessing the motivations which actuate the conduct of bodies corporate. The lack of transparency about Mr Heeney’s deliberations and the cloak of secrecy which shrouded the decision-making process serves to highlight a need for deeper inquiry.
In assessing the reasons that animated the conduct amounting to adverse action, a court must interrogate not merely the state or states of mind of the person or people who engaged in that conduct, but also that of others whose contribution to it rose beyond a threshold level. That threshold level has been variously described as “indispensable” (Elliott v Kodak Australasia Pty Ltd [2001] FCAFC 1804; (2001) 129 IR 251), “material” (Construction, Forestry, Mining and Energy Union v Clermont Coal Pty Ltd [2015] FCA 1014; (2015) 253 IR 166) and “significant”, plainly important”, “major”, “substantial” or “essential” (Wong v National Australia Bank [2022] FCAFC155 (2022) 308 IR 155).
I am left with the distinct impression that the respondents presented a superficial and less than complete explanation of the reasons for Ms Shum’s dismissal. There are significant gaps in the evidence, filled only by the most vague, general and uninformative recollections. It seems to me that the respondents have gathered around what they hope to be a defensible narrative and endeavoured to give evidence which corroborates the decision, but the whole decision-making and redundancy process has a distinct air of artificiality about it. The sole decision-maker thesis advanced by the respondents does not ring true and the evidence did not persuade me otherwise.
If I am to accept the respondents’ evidence that Mr Heeney did not know anything of the organisation prior to the commencement of his employment on 1 May 2017, it is difficult to accept that it was possible for him to make an informed commercial and strategic decision to restructure within a couple of working weeks without a material contribution from others. Logic dictates that Mr Heeney must have looked to others or been guided by others to inform his process of decision-making. Mr Heeney did not conceive of the restructure out of thin air. I do not accept that Mr Heeney’s past experience as a business executive was enough to rationally inform the decision.
Mr Heeney’s decision making must have been informed through interaction with others who knew the organisation much better than him and were in a position to provide information about finances, staffing, budgets, internal politics and corporate history. The evidence as a whole reveals almost no trace of Mr Heeney’s own investigative or deliberative processes. On the issue of the restructure, there are no emails between Mr Heeney and management staff which evidence requests for financial or staff-related information or the provision of such information.
There is evidence that Mr Heeney communicated with Mr Oates almost every day. He also received a briefing from and communicated in some form regularly with Ms Bindra about HR issues and Ms Pollard about financial matters, yet there is a complete absence of any written communications between them. One would have thought that any important business information passing between them would have been recorded in writing and that there would have been a record of requests for information and responses to those requests.
Board minutes relied upon by the respondents do little to inform the question of what actually happened at meetings. There were many meetings, often of several hours’ duration. Agendas and minutes followed a formula which record items for discussion and outcomes, but little of what transpired between the two. The fact that a proposal might be recorded as having been taken to a meeting and discussed, says nothing of what was discussed or the state of mind of those involved in the decision-making.
There is no evidence of any costings, working documents, alternative proposals, cost/benefit analyses or notes of discussions in the period prior to the proposed restructure being put to the board for comment and its subsequent announcement to the staff. The only documents which exist are a single communication to the board and one to the staff which evidence compliance with legal process. The lacuna in the evidence leaves me with a strong sense that the whole process was deliberately undertaken in a shroud of secrecy to minimise the risk of scrutiny.
One of the few concrete instructions given to Mr Heeney was to “settle the staff down”. This instruction was given by Mr Oates to Mr Heeney at their first meeting – and if they are to be believed at least two other board members were present. In my view Mr Heeney’s decision-making framework was thereafter shaped by his belief, informed and reinforced by others, that the organisation was toxic and dysfunctional, that there were governance issues between the board and staff, that the two key personnel in finance were involved in internal politics and had not been providing information to the board, were absent on questionable stress leave, had levelled allegations of bullying against the chairman, other board members and senior staff and were acting uncooperatively. Key informants regarding the internal staff situation at SMRC included Mr Oates and Ms Bindra who themselves were the subject of bullying allegations and had an intimate knowledge of Ms Shum’s internal grievances and antipathy to the board, and Ms Pollard, who had formed and shared a strong adverse opinion about the performance of Mr Lee and Ms Shum in their finance department roles.
I find it difficult to accept that the finance department so quickly emerged as a main focus of the restructure, absent any significant input from in particular Mr Oates, Ms Bindra and Ms Pollard. In my view, the evidence points to a high degree of likelihood that Mr Heeney was exposed to information, background, commentary or recommendations which influenced him to design a restructure which would remove Ms Shum, who was known to be anti-regime and agitating from without.
Based on the evidence, I am satisfied that by the time of Mr Heeney’s commencement on 1 May 2017, Mr Oates bore ill-feeling toward Ms Shum by reason of the complaints she had made against him, other board members and members of senior management. I am inclined to the view, as borne out by the evidence, that executive members of the board shared Mr Oates irritation about Ms Shum’s complaints and allegations of bullying.
For some months, Ms Shum’s incessant litany of complaints and inquiries was an inescapable, almost daily, reality for Ms Bindra, Ms Haralambopoulos and then Mr Heeney. I doubt the edict from the Chairman of the board to “settle the staff down” required any further elaboration. If not already explained to Mr Heeney prior to his commencement, what was meant by that objective would have quickly become apparent to him as he immersed himself in discussions with Mr Oates, Ms Bindra, Ms Pollard, Ms Wattegamage and others after 1 May 2017. It is implausible discussions about the staffing situation did not feature Ms Shum who, as a serial complainer, was perceived by all as a major irritant for the organisation. As a recipient of complaints from Ms Shum himself, Mr Heeney’s short experience in the managing director’s chair would have only reinforced what he was being told by others.
I consider it implausible that communications between Mr Oates and Mr Heeney were not infused with the hope that Ms Shum might never return to SMRC. In my view the information, commentary and observations which must have passed between and among Mr Oates and Mr Heeney and Ms Bindra, Ms Pollard and Mr Heeney about Ms Shum would have significantly influenced Mr Heeney’s decision-making and drawn him to formulate a restructure proposal which delivered on that hope. Mr Heeney may have had the responsibility for the operational aspects of restructuring the organisation, but in my view his decision-making was framed and guided by the unstated but obvious objective of seeing Ms Shum out of SMRC.
The restructure developed by Mr Heeney and presented to the board on 25 May 2017 proved to be a fait accompli. It did not generate any comment at all from the board. Members of the board sought to explain that situation as a governance decision to be “hands-off” and not to interfere in “operational matters”. An alternative, and in my mind equally plausible, explanation for the board’s acquiescence and non-interference was that there was nothing about Mr Heeney’s decision that came as any surprise to them and they were content to keep some distance from it.
The reasoning for the decision to restructure was expressed in broad aspirational language. The formal memorandum to the board which accompanied Mr Heeney’s restructuring proposal was an exemplar in corporate speak and showed the hallmarks of careful curation by legal advisers experienced in employment law. The memorandum to the board and the near identical communication which was sent to staff a few days later said all the right things and appeared tailored to pass muster if the redundancies were subsequently challenged in unfair dismissal proceedings.
CONCLUSION
Ms Shum was subjected to adverse action in her employment, that being the termination of her employment on 19 May 2017.
I have found that prior to her dismissal and during the course of her appointment, Ms Shum exercised workplace rights by making complaints and inquiries in relation to her employment and by initiating proceedings in relation to her WorkCover claim and claims of having been bullied (Fair Work Commission proceeding). The respondents admit the majority of (but not all) instances alleged by the Shum to constitute the exercise of workplace rights.
It is not necessary for Ms Shum to demonstrate that exercises of workplace rights were the reason for her dismissal. It is enough if they were a substantial and operative reason, even if there were other non-prohibited reasons.
I am not satisfied and do not feel a sense of actual persuasion that SMRC has proved on the balance of probabilities that Mr Heeney effected the restructure and dismissal of Ms Shum solely for the reasons claimed. This conclusion reflects my unease as to the state of the evidence which, as I have said, leaves me with a sense that the court has not been presented with the full picture of how and why the decision was made.
In TWU v Qantas at first instance, Lee J observed that the evidence exposed a “huge degree of artificiality” about how the decision came about and that the evidence revealed that it was “all reverse engineered”. As I do in this judgment, Justice Lee expressed concern about the absence of contemporaneous records and the absence of evidence which disclosed who said what to whom about the impugned decision. He said the state of the evidence left him with a sense of disquiet such that he did not fully understand the true extent and nature of the dealings between certain people and what was said and to whom and when. I am left with a similar sense of disquiet in this case.
After hearing all the evidence I am skeptical about Mr Heeney’s claimed independence from the board and other influential executives within the organisation. I do not accept that he had the knowledge or necessary factual foundation to make a sensibly informed decision about the structure of the organisation without exposing himself to the significant influence and views of others. I find it difficult to accept that he operated as a self-guided executive quarantined from the views of those in his orbit. As to whether others made a significant, material, essential or influential contribution to the decision, I am satisfied they did so by shaping Mr Heeney’s thinking about the form and impact of his restructuring decision.
I do not find that Mr Heeney was given a direct instruction to remove Ms Shum. It would have been remarkable for such an instruction to have been given in such blunt terms. However, it is easy enough for close colleagues to convey a preferred outcome implicitly using loaded anecdotes, suggestive language and tone, expressions of frustration or dismay. I doubt Mr Oates, other senior board members and Ms Bindra hid their views.
Further, based on his communications with those who were able to give him information about SMRC and what he learned from documents and emails produced by Ms Shum, it would have been plain enough to Mr Heeney that including the finance department as part of his restructure would meet the approval of Mr Oates and others who had been on the receiving end of Ms Shum’s complaints.
I accept Mr Heeney’s evidence that there were efficiencies and commercial benefits in a flattened organisational structure. There were of course savings to be made from removing three positions, opening up the possibility of rebuilding capital reserves. But when assessing alternatives (if indeed he did so), I am inclined to the view that Mr Heeney was drawn to the option which he knew implicitly would receive the endorsement of the board’s more influential members.
The reasons given by Mr Heeney are at first glance commercially cogent and plausible. But those reasons are expressed at a high level of generality and are not readily supported by any objective contemporaneous evidence. In any event, making a decision to further stated commercial imperatives is not inconsistent with another, complimentary prohibited reason. Crudely, it is possible to kill two birds with the one stone, and when confronted with the need to improve the finances of SMRC and settle the staff down, there was a pathway which served to meet those commercial objectives and simultaneously remove a thorn in the organisation’s side.
Mr Heeney was not insulated from the significant material influence of others, in particular Mr Oates, who I believe (despite their denials) were actuated by prohibited reasons and motivated to see Ms Shum out of the organisation. Mr Heeney’s decision to restructure the organisation was shaped by that influence.
Considering the whole of the evidence, I am not persuaded that SMRC has, on the balance of probabilities, discharged the onus imposed by section 361 of the FW Act. Accordingly, I find that SMRC has contravened s 340(1) of the Fair Work Act.
ACCESSORIAL LIABILITY
Section 550 of the FW Act establishes a form of accessorial liability whereby those who are “involved in” the conduct in which others engage in contravention of civil remedy provisions (including s 340(1) of the FW Act) are taken also to have committed those same contraventions. Section 550 states as follows (headings included):
550 Involvement in contravention treated in the same way as actual contravention
(1)A person who is involved in a contravention of a civil remedy provision is taken to have contravened that provision.
(2)A person is involved in a contravention of a civil remedy provision if, and only if, the person:
(a) has aided abetted, counselled or procured the contravention;
(b)has induced the contravention whether by threats or promises or otherwise;
(c)has been in any way, by act or mission, directly or indirectly, knowingly concerned in or party to the contravention; or
(d)has conspired with others to effect the contravention.
The relevant principles as to “involvement” and accessorial liability were discussed by White J in Fair Work Ombudsman v South Jin Pty Ltd [2015] FCA 1456 at [227]-[234]. In sum, the central principles are:
(1)to be knowingly concerned in a statutory contravention, the person must have been an intentional participant with knowledge, at the time of contravention, of the essential elements constituting it[4];
(2)constructive or imputed knowledge is not enough; actual knowledge is required. But actual knowledge may be inferred from “exposure to the obvious”. It is not necessary that the person also knows that the elements amount to a contravention. Put another way, a person may be an accessory without knowing that the conduct in which he or she is involved is unlawful[5]; and
(3)the person must have engaged in conduct which implicates or involves her or him in the contravention, so that there is a “practical connection” between the person and the contravention[6].
[4] Fair Work Ombudsman v South Jin Pty Ltd [2015] FCA 1456 at [229]
[5] Fair Work Ombudsman v South Jin Pty Ltd [2015] FCA 1456 at [233]
[6] Fair Work Ombudsman v South Jin Pty Ltd [2015] FCA 1456 at [227]
Subsequently, the relevant principles were discussed by the Full Court in Fair Work Ombudsman v Hu [2019] FCAFC 133 (Hu), including the decisions regarding the requirement that the accessory have actual knowledge of the essential elements of the contravention as discussed in Fair Work Ombudsman v Devine Marine Group Ltd [2014] FCA 1365 (Devine Marine) and EZY Accounting 123 Pty Ltd v Fair Work Ombudsman [2018] FCAFC 134.
It is therefore settled law (as per the Full Court in Hu, applying Devine Marine) that accessorial liability:
(1)requires actual knowledge of the essential elements of the contravention and not imputed knowledge; and
(2)does not require knowledge that the essential elements constitute a contravention.
The statutory presumption for which s 361 of the FW Act provides does not apply in relation to an allegation that a person has been “involved in” the contravention of a civil remedy provision contained within Pt 3‑1 of the FW Act: Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [2017] FCAFC 50, [59] (Greenwood, Flick and Rangiah JJ). In order to implicate Mr Oates or Mr Heeney as an accessory to SMRC’s contravention of s 340(1) of the FW Act, the evidence must establish that one or both of them knew at least one of the reasons for which SMRC acted was that Ms Shum made any or more of the complaints or inquiries on which she relies.
Mr Oates
The evidence satisfies me that the board was the guiding mind of SMRC and that the power of the board was concentrated in its very influential chairman Mr Oates. Not only was Mr Oates the chairman, but he was closely aligned with and supported by an executive of Ms Horvath, Ms Periera and Mr Ramdany who were more closely involved with the governance and operations of SMRC than other board members. Mr Oates in particular worked closely with the various CEO’s, including Mr Heeney, attended the offices regularly and was aware of issues, including staffing issues.
Mr Oates, for reasons I have detailed earlier was well aware of Ms Shum and her complaints. Mr Oates was also well aware of the legal processes Ms Shum initiated. Mr Oates himself was the subject of many of those complaints, including to the Fair Work Commission. He contested the complaints and rejected Ms Shum’s allegations of bullying behaviour. He was involved in instructing management to reject the Workcover claim.
Mr Oates was responsible for engaging Mr Heeney and providing instructions and direction to him as interim managing director. Given his extensive discussions with Mr Heeney about the business, I infer Mr Oates would have had actual knowledge of the decision to restructure the organisation and knowledge about its consequences, including the redundancy of Ms Shum. As a board member he had the opportunity to comment on and approve or reject the proposal.
As a long-time leader of the business and former union official, Mr Oates can be taken to have more than a passing knowledge of the legislative protections available to employees and their right to exercise workplace rights free from retribution or adverse action. Mr Oates was aware that Ms Shum had made various threats of legal action and would have been aware that the termination of Ms Shum would expose SMRC to the risk of litigation, including an unfair dismissal claim or a general protections claim. I infer that Mr Oates would have been privy to legal advice obtained by Mr Heeney in relation to the organisational restructure or would have at least been made aware of its substance.
Mr Heeney
Mr Heeney, as a decisionmaker must be taken to have been involved in the contravention. He is an experienced seasoned business executive. He gave evidence that he has been involved in business restructures and redundancies before. Mr Heeney can be taken to have knowledge of workplace laws, including the protections afforded to employees under the Fair Work Act. He sought and obtained legal advice in relation to the redundancy decision and it can be assumed that he was on notice as to the legal risks of that decision.
Mr Heeney concedes and I find that he was aware of the various complaints Ms Shum made about her employment and the exercise of her workplace rights to initiate Workcover and Fair Work Commission proceedings. These complaints were made known to Mr Heeney by Ms Bindra and Ms Haralambopoulos in his initial briefing, and I expect from Mr Oates in their many daily discussions. Mr Heeney was also aware as he was briefed on and represented SMRC’s interests in conciliation at the Fair Work Commission where Ms Shum’s complaints of bullying were ventilated. Mr Heeney was aware of these matters before he announced the organisational restructure and his decision to terminate Ms Shum.
DISPOSITION
For the reasons set out in this judgment, Remittal questions (a) and (b) are answered as follows:
(a)whether Southern Migrant and Refugee Centre Inc (SMRC) terminated its employment of Ms Shum in contravention of s 340(1) of the FW Act; YES
(b)if it did, whether either of Mr Brian Oates or Mr Travis Heeney was (or both of them were), for the purposes of s 550 of the FW Act, involved in that contravention such that he or they might be taken also to have engaged in or committed it: YES
The nature of relief sought in relation to those findings will be the subject of separate proceedings. The court will give the parties an opportunity to digest these reasons and then will list the proceeding for a case management conference at which time orders will be made for the filing of evidence and submissions on the remaining remittal questions.
I certify that the preceding five hundred and forty-seven (547) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Forbes. Associate:
Dated: 8 May 2025
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