Thomas v Westpac Banking Corporation
[1995] IRCA 339
•28 June 1995
C A T C H W O R D S
INDUSTRIAL LAW - TERMINATION OF EMPLOYMENT - Alleged unjust dismissal - Allegations of breach of contract, breach of award and defamation - Dismissal on account of sexual harassment of another employee - Whether applicant indecently touched a female officer - Nature of relationship between the two officers - Touching held deliberate - Open to bank to regard this as misconduct justifying dismissal - Whether bank accorded applicant procedural fairness - Dismissal not harsh, unjust or unreasonable - Claim dismissed.
Industrial Relations Act
TOM NAUNTON THOMAS v WESTPAC BANKING CORPORATION
NO. NI.1241 of 1994
CORAM: WILCOX CJ
PLACE: SYDNEY
DATE: 28 JUNE 1995
IN THE INDUSTRIAL RELATIONS COURT OF )
AUSTRALIA ) No. NI. 1241 OF 1994
NEW SOUTH WALES DISTRICT REGISTRY )
BETWEEN:TOM NAUNTON THOMAS
Applicant
AND:WESTPAC BANKING CORPORATION
Respondent
CORAM:WILCOX CJ
PLACE: SYDNEY
DATE: 28 JUNE 1995
MINUTES OF ORDER
THE COURT ORDERS THAT:
The application be dismissed.
Note:Settlement and entry of orders is dealt with in Order 36 of the Industrial Relations Court Rules.
IN THE INDUSTRIAL RELATIONS COURT OF )
AUSTRALIA ) No. NI. 1241 OF 1994
NEW SOUTH WALES DISTRICT REGISTRY )
BETWEEN:TOM NAUNTON THOMAS
Applicant
AND:WESTPAC BANKING CORPORATION
Respondent
CORAM:WILCOX CJ
PLACE: SYDNEY
DATE: 28 JUNE 1995
EXTEMPORE REASONS FOR JUDGMENT
WILCOX CJ: This is a claim for damages brought by Tom Naunton Thomas against his former employer, Westpac Banking Corporation. The amended Statement of Claim contains three separate causes of action. One of them is an allegation of breach of the contract of employment. Secondly, there is an allegation of contravention of a term of an industrial award binding the respondent, namely clause 37 of appendix C of the Bank Officials Federal (1963) Award. That clause stipulates that - "Termination of employment by the bank shall not be harsh, unjust or unreasonable". The third cause of action is a claim in defamation arising out of publication of a report by an investigator appointed by the bank, Donald Reid, to the bank officer whose duty it was to make a decision about termination, Trevor Russell. There is also a complaint of defamation arising out of publication of the fact that Mr Thomas had been dismissed for wilful and serious misconduct.
I think there are legal problems in relation to each of the three claims, they being different in each case. It is not necessary for me to go into those problems; still less to resolve them. It is clear that none of the causes of action can succeed if the proper factual finding is that the termination was not harsh, unjust or unreasonable. That would certainly be a direct answer to the first two claims; and I think it would also furnish an answer to the defamation claim because a defence of justification would then be made out. In any event, it seems to me there is an available defence of qualified privilege which would be overcome only by a finding of malice, the alleged malice being that of Mr Reid. I am not satisfied that Mr Reid was affected by malice at any stage.
Coming back to the question of whether the dismissal was harsh, unjust or unreasonable, it is appropriate to note that counsel for the applicant relies on both substantive and procedural unfairness. They are separate subjects which have to be separately addressed. It is of course possible for there to be substantive unfairness in making a decision, notwithstanding meticulous adherence to procedural requirements. It is also possible for there to be procedural unfairness, even though the ultimate decision is one that appears justifiable in substantive terms.
In relation to substantive unfairness, the central issue between the complainant (who has been identified for the purposes of these proceedings as "WP") and the respondent is what happened at a certain lunch held on 17 December 1993. The lunch took place at a restaurant at Lane Cove. It was attended by twelve people, all employees of the bank concerned with its computer services section. Each of them knew each other. The events of the lunch are the subject of dispute. I must analyse the dispute, because it is of critical importance. But it is desirable, first, to put the lunch into context by referring briefly to the prior relationship between WP and the applicant.
It is common ground that, by the time of the lunch, the applicant and WP had known each other for several years. They had worked in the same section for about three years. This section was based at St Leonards. During that time there had been numerous occasions in which, as members of the group of people working in the computer section, they had gone out to a restaurant for lunch. On two occasions, it seems, the respondent went out to lunch with WP and the only other female member of the group in which he was employed, Narelle Simpson. There is no suggestion of a one-to-one personal relationship between the applicant and WP. It seems clear enough that there was a degree of mutual friendliness in the early stages of the relationship. However, it seems also to be clear that, as time went on, WP found it more difficult to tolerate some of the things said to her by the applicant. The evidence gives some detail about these things.
It appears that the applicant was in the habit of making comments about WP's clothing and perfume. Sometimes the comments were complimentary, sometimes they were not. WP came to dislike the way the applicant looked at her. She described this as a leer; looking her up and down, rather than between the eyes. Ms Simpson makes a similar complaint.
WP is an Australian, born in Australia of Greek parents. She said the applicant frequently used the word "ethnic" in reference to her and, as time went on, she realised that he reserved that word for her alone. She said that sometimes this did not worry her; on other occasions it did.
It seems to me that "ethnic" is one of those words whose offensiveness or otherwise depends on the way in which the word is used. The fact that the applicant was in the habit of using the word "ethnic" in conversation with WP is, I think, corroborated by a message she included in a postcard she sent to him from Greece, when she was on holidays in August 1993. Apparently she sent postcards to everybody in the work unit. Her message to the applicant was this:
"Hey you'd love Greece. Ethnics everywhere, and I don't mean Greeks. We're not ethnics. The Pommies, Aussies, Germans etcetera are the wogs here. Having fun, trying to blend in with the locals but you see they call me a xeno, that means ethnic. I'm not even a Greek, so there. Hope you are missing me but I'd say it's the lunches you'd be missing. See you soon."
The reference to the lunches was explained by WP as arising from the fact that she usually took the initiative in organising the group to go out to lunch. Not much weight should be put on the post card, I suppose; but it does indicate that WP was sensitive about the use of the word "ethnic". This is consistent with her complaint that the applicant used the word in a manner calculated to put her down. It was for that same reason that she felt embarrassed by his comments about her clothing.
There was an incident in September 1993 when WP and the applicant, and perhaps other people, were in the kitchen at work. It is common ground that the applicant placed a cup against WP's bare arm. She said the cup was very hot and that it scalded her, causing a red mark that lasted for days. The applicant said the cup was only warm and this was a joke.
There was a further incident in November 1993 when the applicant and WP, with others from their unit, were at the bank's computer centre at Ryde. They were due to return to St Leonards. The applicant asked WP for a lift back to St Leonards, she having her car at Ryde. WP was not ready to leave and suggested that he go with somebody else who was leaving sooner. He did not do this. He passed up that opportunity and waited for her. She says in her evidence that she was uncomfortable about being alone with him in the car and drove very fast. WP makes no complaint of untoward behaviour on that occasion. However, if she is to be believed, the incident indicates that she was not relaxed in his company or well-disposed towards him.
I turn to the lunch itself. When the lunch was first proposed WP was disinclined to have the applicant in the lunch party. She was overborne by other people who thought he should be invited. This is what happened. In the ultimate, there were 12 people at lunch. There is no dispute about the seating pattern. The applicant was at one end of a table; to his left was a man named Ivan Kladnig. To Mr Kladnig's left was Narelle Simpson. To her left was Trevor Scarr. To his left was WP, and to her left was Don Byron. On the opposite side of the table there were six male members of the group. It is common ground that, during the course of the lunch, some awards were given to members of the group. I gather that these were of a facetious nature, judging by the symbols that were distributed; as shown in photographs taken by WP that are in evidence.
It is also common ground that, in the course of photographing Alex Beltran, who sat immediately opposite Ivan Kladnig, WP came to the back of Mr Kladnig's chair. At that time, as again is common ground, the applicant was seated, leaning slightly forward and probably with his body turned slightly towards Mr Kladnig; and certainly with his left arm along the back of Mr Kladnig's chair. He said that his hand was dangling down outside the back of the chair. It seems that WP approached the back of the chair in order to take the photograph and it is common ground that the lower part of her body came close to the applicant's hand. Indeed, it is common ground that her body and the hand came into contact. There is a dispute about how this happened.
The applicant's evidence was that he became aware of pressure against his hand as he was talking to Mr Kladnig. He felt uncomfortable about the pressure. I gather he meant physically uncomfortable. But he said he did not immediately move his hand because it was potentially embarrassing to do so. When asked about this, he explained that he realised that his hand was close to the "private parts", or external genitalia, of WP. Nonetheless, he said he did move his hand. He emphatically denied having deliberately put his hand in contact with WP's external genitalia.
WP said that she felt something pressing against her as she focused the camera; but she concentrated on taking the photograph and it was only after she had taken it that she realised something was rubbing on her body. She looked down and saw a hand. She could not believe what she was seeing. The hand seemed disembodied. With her eyes she followed the hand up the arm of the applicant and met his eyes. She said he maintained eye contact for some time, that he was smirking at her and looking "like the cat that swallowed the pigeon". WP said she felt disbelief.
It is clear that WP did not call out or draw anybody's attention to what had happened. The three men sitting opposite noticed nothing. If the action was all below the top of the chair, I would not expect they would. Their view would be blocked by Mr Kladnig's body. But, plainly, WP did not draw attention to the incident in any way. She said that she stepped back; she felt shocked and moved towards her own chair. As she did so, she spoke to Narelle Simpson; perhaps significantly, the only other woman in the party. According to WP's evidence, she said to Ms Simpson, "I don't believe what has just happened." Ms Simpson asked, "What?" WP replied, "I will talk to you later."
Ms Simpson's evidence was that she noticed nothing. I would not expect she would if she was looking forward at the time of the incident. But she does remember an exchange with WP, as WP walked back to her chair. Ms Simpson put the exchange in slightly different terms. According to her, WP said, "You'll never believe what's happened, Tom's just grabbed me." It is common ground between WP and Ms Simpson that there was no elaboration at that time, that WP resumed her chair and only later said something further.
Mr Kladnig gave evidence that he heard WP say to Ms Simpson: "When I was taking that photo of Alex, Tom was feeling me." It is not clear whether this exchange occurred as WP was returning to her chair or slightly later. Mr Kladnig said that, when WP said this to Ms Simpson, she was crouched down beside Ms Simpson's chair. The significant point, it seems to me, is that, very shortly after the photograph was taken, WP made a statement to Ms Simpson, overheard by Mr Kladnig, alleging that something unusual had happened and that it involved the conduct of the applicant.
The lunch went on and, in due course, all the participants returned to work. Mr Kladnig noted that WP was very upset. He spoke to the applicant and told him to "stop hassling the girls". During the ensuing conversation, Mr Kladnig told the applicant, "WP thinks you goosed her". Mr Kladnig said the applicant replied, "I think maybe I should apologise". It is noteworthy that the applicant did not deny the allegation of goosing.
The applicant then went to WP's work place. The parties to the event each occupied their own small space in an open plan office layout. WP's work place was directly opposite that of Ms Simpson. When the applicant came to a position close to WP's work place, he saw that she was on the telephone. While he was waiting for her to finish on the telephone, he had a conversation with Ms Simpson. Ms Simpson's account of that conversation is that the applicant asked her, "Have I upset (WP)?" and that she replied, "Look, I don't know the full story and I don't want to buy into it at this stage". Ms Simpson said that the applicant then said words to this effect, "My hand was on the back of the chair and (WP) was standing against the chair. I thought, should I or shouldn't I? Oh well, what the heck. I just wiggled my fingers". According to Ms Simpson, he then gave her a demonstration of what he said had occurred. He put his hand on the top of a chair back and moved his fingers up and down for one or two seconds.
When WP finished her telephone conversation, the applicant spoke to her; but she declined to discuss the matter with him and quickly left her position. Subsequently, he telephoned her on an external line. Apparently there was an identification system on the internal lines. She declined to discuss the matter.
Early on the following Monday, WP spoke to Don Byron, the mutual superior of herself and the applicant. Mr Byron said it would be necessary for her to put the complaint in writing, if it was to be taken further. That evening, at home, she prepared a statement. The document is in evidence. It was apparently passed through appropriate people in the bank and, on the following Thursday, 23 December, Mr Reid interviewed WP, Ms Simpson and Mr Kladnig. He took statements from each of them. On the following morning, Mr Reid interviewed the applicant. The applicant denied any deliberate touching. At the conclusion of the interview, Mr Reid suspended the applicant from further duties, I assume with pay, until the bank decided what action to take. Mr Reid prepared a report in which he made a recommendation for the applicant's dismissal. The report went to Mr Russell. He discussed it with Mr Reid and made a decision to dismiss. The applicant was dismissed on 5 January 1994.
The issue as to what happened at the lunch is within a small compass. I have to make a judgment as to which of the principal witnesses, that is to say WP and the applicant, is to be believed. The applicant says any touching was accidental. On the other hand, it is clear that, if WP is correct, the touching was deliberate.
I have no doubt that WP's account should be preferred. I was favourably impressed with the manner in which she gave her evidence, including during lengthy cross-examination. Her account of the incident rang true from beginning to end. The version she gave in the witness box did not depart in any significant respect from that set out in her statement of 20 December or the more detailed account contained in the statement taken from her by Mr Reid on 23 December.
I think WP's reference to the look on the applicant's face is particularly significant. In the absence of that factor, one might perhaps reach the conclusion that the touching was an accident and she misunderstood what was happening. But if she is accepted in her evidence about the applicant's look, there is no doubt that his action was deliberate.
There are other matters as well. First, there is the immediate complaint to Ms Simpson. If WP was making up this story, then she showed remarkable quickness of mind; leaving aside that this would be a particularly vile thing to do, and I do not think she is that sort of person. There is no doubt that there was an immediate complaint to Ms Simpson. I accept Ms Simpson's evidence entirely. The making of a complaint is also corroborated by Mr Kladnig. I accept his evidence. There is no reason for him to be untruthful about the matter. He no longer even works for Westpac.
Secondly, it is clear that WP was noticeably distressed after the lunch. There is no suggestion that she was distressed before the lunch, or of any other cause for her post-prandial distress.
Thirdly, the incident is consistent with the prior conduct of the applicant. I doubt that his act had a directly sexual connotation. It seems to me that his attitude towards WP was one that failed to acknowledge her as an equal and as a person worthy of respect. A course of constant putting down and derogative remarks is essentially attempted domination. Sexual assaults often have the same motivation.
The fourth aspect of the matter that weighs heavily with me is the statement made by the applicant to Ms Simpson, according to her evidence. I have already referred to this statement. It is consistent only with a conscious decision by him to move his fingers, he knowing their proximity to WP's genitalia.
Having given the matter careful attention, I am left in no doubt whatever that the applicant did what he is alleged to have done; and did so deliberately. This was an act of serious sexual harassment. I agree with Mr Reid that it amounted to a sexual assault, which is a criminal offence. It is important that employers take a strong attitude about sexual harassment of employees. The bank apparently has policies designed to protect its employees from sexual harassment. In my view, the bank is justified in treating offences, when established, as matters of serious concern.
The bank's sexual harassment guidelines mention several possible disciplinary measures. They range from warning the employee, in a counselling session, upwards through closer supervision and transfer to another position or workplace to dismissal. Mr Russell thought dismissal was the only appropriate remedy in this case. That view was open to him. I doubt whether a warning or closer supervision would have sufficed; particularly if the applicant and WP were left working together in day-to-day proximity, as members of a small group. Transfer to another position is a possibility that would sometimes, perhaps often, be worthy of consideration. But the difficulty, as Mr Russell pointed out was that the applicant was a person with very specialised skills. He could not be employed by the bank elsewhere, except in a job where he was grossly under-utilising his skills. Under these circumstances, I think it was reasonable for Mr Russell to take the view that the appropriate course was dismissal. Accordingly, I do not think the dismissal was harsh, unjust or unreasonable in a substantive sense.
I turn to the question of procedural unfairness. Counsel for the applicant has raised numerous matters. I will deal with them all; in my opinion none of them has any substance.
First, it is said that Mr Reid denied the applicant procedural fairness because he failed to interview all the relevant witnesses. Counsel refers to the decision of the full Federal Court in Byrne v Australian Airlines Limited (1994) 47 FCR 300 and especially to the judgment of Beaumont and Heerey JJ at 330 where their Honours referred to the failure of the investigator in that case to interview the fourth member of the team of porters who worked on the job during which the two appellants were alleged to have engaged in pilfering, in conjunction with a third member. I can understand why their Honours thought deficient an investigation that omitted any attempt to interview the fourth porter. I have no doubt that a failure to interview a person likely to be able to throw light on an incident may amount to a denial of procedural unfairness. In this case counsel says Mr Reid should have interviewed the three men, who were sitting opposite Mr Klandig. It is clear that Mr Reid did not interview these men but I do not think that this amounts to a denial of procedural fairness. Mr Reid was concerned to carry out the investigation as discreetly as possible, in order to avoid disturbing the relationships within a small group of people. This would not be a sufficient reason for failing to interview the men if they were in such a position that Mr Reid had reason to believe they could have helped his inquiries. But I see no reason to think they could have helped. I have already mentioned that their view must have been obscured by Mr Klandig's body.
Next, it is said that Mr Reid denied procedural fairness because he failed to inspect the premises and, in particular, the chair. When taxed with this, Mr Reid did not think a visit would have achieved anything. I agree.
Then it is said that Mr Reid failed accurately to inform the applicant of the nature of the charge made against him; and, as a variant on this, it is said that he deliberately procured WP to make a false statement. The two matters are linked. It appears that, when she was interviewed by Mr Reid, WP described the place where she was touched as her "groin". Mr Reid was of the view, as he explained in his evidence, that the groin extended from the lower part of the abdomen under the body, and including the inner thighs, right round to the back passage. He thought that greater specificity was desirable and, in the course of questioning WP, he asked her whether she was talking about the vagina. She assented to this. It seems to be clear that she was not suggesting penetration of what is strictly called the vagina, but rather touching of the external genitalia or vulva. Mr Reid apparently believed that the word "vagina" included the vulva. That is the reason why he used the word "vagina" in the statement that he prepared for WP and why, when he outlined the nature of the allegation to the applicant, he said: "She claims that you touched her through her dress on her vagina". It is unfortunate that Mr Reid used inaccurate terminology, but there is no doubt that the applicant knew what part of WP's anatomy was under discussion. I do not think Mr Reid failed to inform the applicant of the nature of the accusation. I certainly reject the suggestion that Mr Reid set out to procure WP to make a false accusation. I am favourably impressed with the way in which Mr Reid undertook this particular investigation.
It is then said, by way of complaint of denial of procedural fairness, that Mr Reid should have provided with a copy of WP's full statement. This is one way of conveying to a person, the subject of investigation, the nature of an accusation. But it would be a mistake to elevate that method into a rule applicable to all occasions. Many people find it difficult to cope with a lengthy statement. They become confused, and perhaps miss the point. Although it is more difficult for the interrogator to do this in an accurate way, in the majority of cases, it is probably better to do what Mr Reid did here; namely, to summarise the gist of the accusation. In the course of any interrogation, further details will become relevant. These should be supplied, as needed to enable the interrogated person to respond. It appears this happened in this case. There was a preliminary discussion before the formal record of interview in which Mr Reid travelled broadly over the allegations. I have no doubt that the applicant knew what he was being accused of doing and I do not think Mr Reid's failure to provide him with a copy of the statement constituted a denial of procedural fairness.
It was said, although not elaborated in argument, that there was a denial of procedural fairness because Mr Reid failed to re-interview WP after interviewing the applicant. I see no substance in that matter.
Then it is said that the interview was conducted under duress. This has two aspects: first, that the applicant was not informed that he need not submit to the interview; and, second, that a police style interrogation was inappropriate.
As to the first matter, it is clear that the applicant realised he was free to refuse to attend the interview or to walk out at any time. It is obvious why he would be reluctant to do this; such a course would almost certainly result in a decision of dismissal. In a sense, he was not free to refuse to participate, if he wanted to keep his job. The applicant realised this. Question 126 at the interview was in the following form: "Was any covert threat, inducement or promise held out to you to take part in this recorded interview?" He replied: "I did not feel that I could decline". I note that he did not say that he was unable to refuse but that he did not feel that he could; obviously, having regard to his wish to retain his position.
As to the police style interrogation, I do not think that a question and answer form is necessarily bad. Indeed, it is probably the best way of ensuring that an answer is not taken out of context. If, by "police style interrogation" counsel refers to pressure on the interrogated person or hassling him (either in relation to the speed with which answers have to be given or the manner or form of the answers), then I would certainly agree this would be inappropriate. But there is no evidence of this having occurred on this occasion. Mr Byron was present throughout the interview, which extended over two and a half hours. Mr Byron gave evidence and made no suggestion of untoward pressure being put upon the applicant.
It is suggested that there was a denial of procedural fairness because the applicant did not have the opportunity of having present his own selected representative. There is some discrepancy in the evidence on this point. Mr Reid said that he asked the applicant whether he wished Mr Byron, who had brought the applicant into the office for the interview, to remain or whether he wished some other person to be present and that the applicant indicated that Mr Byron should remain. Mr Byron did not recall a reference being made to any other person. I do not think anything turns on this. It was certainly desirable that there be a third person present during the interview. It is clear that the applicant did not ask for anybody else to be present and there is no reason for believing that Mr Byron's presence was other than a useful safeguard to him.
Finally, it is said that procedural fairness was denied because Mr Reid did not follow Westpac's own sexual harassment complaint guidelines. Counsel referred to a page in the guidelines that deals with the role of human resource managers. He pointed out, quite correctly, that the course taken by Mr Reid did not coincide in detail with that stated on the page. He put the same suggestion to Mr Reid in cross-examination. Mr Reid's response was that he was not a human resource manager, he was an investigator; the bank had asked for the complaint to be investigated by a trained investigator rather than having it dealt with by a human resource manager. He said that in this situation he felt he should follow investigation procedures; namely, to interview the people who appeared to be able to assist as witnesses and take statements from them and then put the allegations to the person under accusation under circumstances where he had the opportunity of dealing with them and where his responses were recorded. This reply summarises the relevant essentials of procedural fairness. It is not appropriate to condemn the course taken by comparing it to the detail of what would have been done by a human resource manager. It seems that the intendment of the manual is that human resource managers will sometimes deal with cases, perhaps where an allegation is of a less serious nature. But the manual clearly envisages the possibility of the human resource manager calling in the investigations department where necessary. This is what happened in the present case.
I think Mr Thomas was treated fairly. I do not see any basis for suggesting that the dismissal was harsh, unjust or unreasonable on procedural grounds. There is no substance in the complaint that the dismissal was of that nature, whether on substantive or procedural grounds.
As I said at the beginning of these reasons, a finding to the contrary of that statement is essential for the applicant to succeed on any of his causes of action. Having regard to my finding, there is no point in my embarking on the difficult question whether any or all of those causes of actions would be available, if there was a different factual finding. The application cannot succeed. It should be dismissed. I so order.
I certify that this and the preceding twenty (20) pages
are a true copy of the Reasons for Judgment
of the Honourable Chief Justice Wilcox.
Associate:
Dated: 28 June 1995
APPEARANCES
Counsel for the Applicant: M Christie
Solicitors for the Applicant: Champion & Partners
Counsel for the Respondent: C Ronalds
Solicitors for the Respondent: Freehill Hollingdale & Page
Date of hearing: 28 June 1995
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