Todd Smythe

[2014] FWC 6924

[2014] FWC 6924

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Todd Smythe
(U2014/10027)

Daniel Massey
(U2014/10198)

v
Hansen Yuncken Pty Ltd

SENIOR DEPUTY PRESIDENT O’CALLAGHAN ADELAIDE, 9 OCTOBER 2014

Application for relief from unfair dismissal - valid reason - evidence of misconduct - unjust finding - remedy - deduction for misconduct.

[1] This decision deals with applications made by Mr Smythe 1 and Mr Massey2 pursuant to s.394 of the Fair Work Act 2009 (the FW Act) with respect to the termination of their employment by Hansen Yuncken Pty Ltd (H&Y). The applications were unable to be settled through the conciliation process and were referred to me for determination.

[2] Both applications were considered in a hearing on 22 and 23 September 2014. Mr Smythe and Mr Massey were represented in this hearing by Mr Allen, of counsel. H&Y was represented by Ms Clark, of counsel. Permission was granted in each case pursuant to s.596(2) of the FW Act.

[3] There were no issues of an initial or jurisdictional nature associated with the applications.

[4] H&Y operates in a joint venture with Leighton Contractors Pty Ltd in the construction of a hospital (the Joint Venture). Mr Smythe and Mr Massey were engaged by H&Y on the new Royal Adelaide Hospital (the NRAH) as tower crane operators. For some weeks prior to the Easter holiday period in 2014, Mr Smythe and Mr Massey were operating the tower crane known as Tower Crane 1B. Mr Smythe and Mr Massey left the NRAH site on 17 April 2014 and commenced a period of leave. The Tower Crane 1B was serviced as part of a routine service shortly after Easter by the crane owner, Select Plant Hire Pty Ltd (Select Hire). Select Hire identified serious damage to the hoist rope of the crane. This damage was then reported to the Joint Venture. The hoist rope was then the subject of an investigation. H&Y were concerned that the extent of the damage to the hoist rope was such that it should have been identified by Mr Smythe and Mr Massey during their pre-start checks on the crane and/or its operation. Mr Smythe and Mr Massey were formally interviewed on their return to work. Formal allegations were put to them. Further investigation of the matter then followed. Mr Smythe and Mr Massey were again separately interviewed before being dismissed for misconduct.

[5] Mr Smythe and Mr Massey assert that termination of their employment was a disproportionate response to this matter such that it was harsh. Further, that their conduct could not be regarded as wilful misconduct and that uncertainty about the nature, location and timing of the damage to the hoist rope meant that there was no valid reason for the termination of employment decision. Accordingly, they asserted that the termination decision was unjust. Mr Smythe and Mr Massey assert that the termination decision was unreasonable because the evidence before H&Y did not establish the allegations made against them.

[6] Mr Smythe initially sought reinstatement or, in the alternative, payment of compensation. Mr Massey sought an order for payment of compensation.

[7] H&Y asserted that the evidence confirmed that Mr Smythe and Mr Massey had not performed, or adequately performed, the necessary pre-start checks and that, given the nature of the work and the risks associated with it, this represented a valid reason for employment termination. H&Y asserted that the process it followed to terminate Mr Smythe and Mr Massey’s employment was procedurally fair such that those employment terminations were neither harsh, unjust or unreasonable. In the alternative, H&Y asserted that the progressive decommissioning of the tower cranes meant that reinstatement was not feasible, and that no other suitable alternative positions were available in South Australia and that neither Mr Smythe nor Mr Massey would have been employed beyond September 2014 in any event.

The Evidence

[8] Mr Smythe and Mr Massey gave evidence about their employment history and crane driving qualifications and experience including the operation of Tower Crane 1B. The evidence was that they conducted daily pre-start checks and that these did not disclose deterioration of the hoist rope. Their evidence went to the use of the logbook checklist for the daily pre-start checks. Both Mr Smythe and Mr Massey gave evidence about how they became aware of the damage to the hoist rope on their return from leave after Easter and the steps they then took to access and consider the damaged rope.

[9] Mr Smythe and Mr Massey gave evidence about the first investigation interviews, which involved a CFMEU representative. Both Mr Smythe and Mr Massey were subsequently given notice of formal allegations relative to the matter. These allegations were that: 3

“ over the period leading up to and including Thursday 17 April 2014, you have signed off as to having performed the pre-start checks on TC-1B on a number of occasions where you haven’t identified and/or reported (including making such note in the Tower Crane Daily/Weekly Safety and Service Log) that the rope was not properly lubricated;

• over the period leading up to and including Thursday 17 April 2014, you have signed off as to having performed the pre-start checks on TC-1B on a number of occasions where you haven’t identified and/or reported (including making such note in the Tower Crane Daily/Weekly Safety and Service Log) that the rope was showing signs of birdcaging or that it had birdcaged;



• over the period leading up to and including Thursday 17 April 2014, you operated TC-1B with the wire rope in a clearly deteriorated state (i.e. the birdcaging of the wire rope was or should have been clearly obvious by visual inspection, and the operational response of the crane as the birdcaging section of the wire rope passed through the sheave groove(s)).”

[10] I note that the term “birdcaging” refers to obvious damage to the wire rope whereby the wire strands have unravelled so as to leave a hollow centre thereby resembling a birdcage.

[11] Mr Smythe and Mr Massey worked as a dogman rather than crane drivers whilst the matter was being investigated.

[12] Mr Smythe’s evidence went to his attendance at a second disciplinary meeting on 23 May 2014 with various H&Y personnel and a site Health and Safety Representative as his support person. His evidence was that he was shown photos of the rope and that reference was made to expert reports not provided to him. After discussions about the damage and his pre-start inspection obligations, the meeting was suspended. Shortly after it was reconvened, Mr Smythe was advised of the termination of his employment. He subsequently received written advice about this. 4

[13] Mr Massey's evidence went to his attendance at a similar disciplinary meeting with the same outcome on 30 May 2014 after he returned from a period of annual leave.

[14] Mr Smythe's evidence also addressed his subsequent investigation of the condition of the hoist rope which was located at a specialist contractor facility (Nobles) and the photographs and film he took of the rope.

[15] Mr Friday is a Tower Crane driver and a qualified trainer and assessor in the building and construction industry. His evidence went to his experience and his observations of the videos of the rope taken by Mr Smythe. Mr Friday also gave evidence about his observations of the photographs taken by the Select Plant service operator. This evidence went to his assessment of the extent to where damage to the hoist rope would have been visible to a crane operator in the course of normal inspections. Mr Friday was shown photographs of the damaged hoist rope. Whilst his evidence confirmed the obvious damage, he was not able to confirm other, less obvious damage on the basis of those photographs.

[16] Mr Spyro is a Crane Driver/Rigger who had previously worked with Mr Smythe and Mr Massey. His evidence went to his experience of working with them and their commitment to safety.

[17] Mr Kerpiniotis is the Joint Venture Operations Manager for the NRAH. His evidence went to the process followed by the Joint Venture to investigate the damage to the hoist rope and the concerns on the part of the Joint Venture that signs of deterioration to that rope should have been identified by the crane operators. Mr Kerpiniotis’ evidence went to the investigations in which he was involved and his conclusion that damage to the rope would have been noticeable over some weeks. Mr Kerpiniotis gave evidence about the disciplinary process he initiated, including his participation in the first disciplinary meetings with both Mr Smythe and Mr Massey and other Joint Venture personnel. His evidence extended to the further investigations undertaken by the Joint Venture and, particularly his consideration of a report prepared by Mr Nunweek. 5

[18] Mr Kerpiniotis then gave evidence about the separate meetings with Mr Smythe and Mr Massey before his decision to terminate their employment was made.

[19] Mr Jarman is a Human Resources Manager with H&Y. His evidence went to the progressive demobilisation of the tower cranes with particular reference to Tower Crane 1B which was demobilised and removed from the NRAH site on 12 September 2014. Mr Jarman also gave evidence about his enquiries within H&Y which led him to conclude that there were no alternative available positions for tower crane operators and no other labouring positions within H&Y in South Australia.

[20] Mr Hennessey is an electrician engaged by Select Plant and is currently based at the NRAH site. His evidence was that: 6

“I was not the person who first identified the damage, though I did report it to the Select Plant Hire office. I recall that on about the day before the Easter break I was told by a stand-in crane operator about some problems with the hoist rope on Tower Crane 1-B. I recall that the operator’s name was Gavin but I do not know his surname. I can’t remember the exact words we exchanged, it was too long ago.

After Gavin told me about the problem with the hoist rope, I reported the issue to my Manager, Vicky, at Select Plant Hire. I did this because I knew that the Crane was to be serviced the following week and I would be on leave. I wanted the technicians who would be servicing the crane to know about the issue so they could check the rope.

This was my only knowledge and involvement in relation to checking the state of the hoist rope. I did not actually go up the Crane and inspect the rope myself after speaking with Gavin, nor was I involved with the service which took place 22 - 24 April 2014.”

[21] Mr Sell is a Tower Crane operator with H&Y. His evidence was that he worked on Tower Crane 1B on one occasion about two weeks before Easter. Whilst working on that crane he noticed signs of deterioration on the hoist rope during his pre-start checks. He particularly noticed that the hoist rope was quite dry and that some strands on the rope were starting to unravel on the rope between the tower crane cabin and the winch. 7 Mr Sell reported this to Mr Hennessey and suggested that he should look at it. Mr Sell did not fill in the crane logbook that day and explained that this was a consequence of his reservations about whether the hoist rope damage was sufficiently serious to stop operation of the crane. He advised that, whilst operating that crane, he ensured that it did not lift quantities near to its maximum load capacity. Mr Sell’s evidence was that he did not discuss his concerns with Mr Massey or Mr Smythe but that he assumed they would also notice the condition of the hoist rope. Mr Sell advised that he only spoke with H&Y management about the matter shortly before the hearing and understood that H&Y became aware of his involvement because Mr Hennessey had referred to him. Mr Sell advised that he was now aware that he would be subject to a disciplinary investigation relative to his conduct.

[22] Mr Nunweek is the Joint Venture Crane and Logistics Manager on the NRAH site. His evidence went to his experience in relation to crane operation and his role in the project. Mr Nunweek’s evidence went to the duties undertaken by Mr Massey and Mr Smythe and the advice provided to him on his return from leave on 28 April 2014 in relation to the damage to the hoist rope on Tower Crane 1B. Mr Nunweek was shown photographs provided by Select Plant of the damage. He subsequently inspected the damage to rope which had, at that time, been removed from the crane. He participated in the discussions with Mr Smythe on 30 April 2014, together with Mr Kerpiniotis and other Joint Venture personnel. His evidence went to the matters discussed in this meeting. Mr Nunweek’s evidence also went to the discussion with Mr Massey on the same day. He gave evidence about the steps he then took to investigate the issue which included measurement of the rope to ascertain the position of the damage. Mr Nunweek considered a report provided to Select Hire by the supplier of the hoist rope, A Noble & Son Ltd. He concluded that the damage to the hoist rope should have been identified during a pre-start check or during use of the crane and provided a report 8 to this effect. Mr Nunweek’s evidence was that his primary concern related to the less severe damage to the rope and that he accepted that the severe damage most likely became apparent just prior to the crane ceasing to be used. In this respect he assessed this major damage as being so obvious that it would have been obvious to both the crane operator and other site personnel. In terms of the less obvious damage, Mr Nunweek concluded that this would have been apparent to the crane operators in the course of the pre-check activities at least a week before Easter. Mr Nunweek’s evidence went to his participation in the discussions on 23 May 2014 that led to the termination of Mr Smythe’s employment and his subsequent participation in the meeting on 13 May 2014 that led to Mr Massey’s dismissal.

[23] Mr Balfour is a Testing and Inspection Coordinator with A Noble & Son Ltd. His evidence went to a report into the hoist rope which was undertaken by A Noble & Son Ltd for Select Plant. He detailed the process followed and the impact of changes in tension on the rope in terms of both a cause of the damage and the capacity to observe the damage. Mr Balfour was not able to assess when the damage to the hoist rope actually occurred.

[24] Mr Seymour is a Rigger for Select Plant. He was one of the team of three Select Plant personnel who conducted the service on Tower Crane 1B where the damage to the hoist rope was identified. His evidence went to the inspection process and the extent to which, before the crane was operated, he identified that the rope was damaged and took a series of photographs of that damage. He subsequently contacted his manager and then sent him those photographs. Those photographs 9 formed the basis for the subsequent discussions with Mr Smythe and Mr Massey. Mr Seymour’s evidence was that the inspection team were then instructed to remove the rope ready for a replacement.

[25] In considering the evidence before me I have also had regard to the numerous photographs and documents provided. In terms of these photographs, I have noted that they include the photographs taken by Mr Seymour when he discovered the damage to the hoist rope.

Findings

[26] Section 387 of the FW Act sets out the factors to which I must have regard in considering these applications. Before considering those factors I have set out below my conclusions about the key disputed issues of fact relevant to the matter.

[27] A substantial matter in dispute between the parties related to the extent of the damage to the hoist rope and the actual location of that damage. In this respect I have differentiated between the obvious damage to the hoist rope which is accepted by all of the parties and which H&Y acknowledged in the hearing is likely to have occurred only shortly before the crane ceased operating for the Easter break. The less obvious damage was identified by Mr Nunweek from his observations of the rope and from the photographs taken by Mr Seymour. This, less obvious damage consists of lifting and separation of the wire strands. The extent to which the photographs show this damage is disputed. Mr Nunweek asserts that damage can be seen from the photographs and that it extends over such a significant length of the rope that it had to be apparent to Mr Massey and Mr Smythe in the course of the daily pre-start checks. Mr Massey and Mr Smythe, and for that matter, Mr Friday, disputed the extent to which that less obvious damage is shown in the photographs.

[28] Two other factors complicate the issue of the extent and location of damage to the hoist rope. Firstly, the evidence indicates that the rope itself was the subject of rough handling in the course of being prepared for removal from the site and that it was potentially further damaged when left exposed in a traffic area at the A Noble & Son Ltd premises. Consequently, whilst I have been shown photographs and film taken by Mr Smythe at those premises, I am not prepared to base conclusions about where the location and extent of the relevant damage to the hoist rope on the basis of that material.

[29] Secondly, the evidence of Mr Massey, Mr Smythe, and Mr Friday and, to some extent, Mr Seymour, indicated that the appearance of damage to the rope could be impacted by the extent to which it was under load at the time.

[30] These matters are particularly significant because it is common ground between the parties that Mr Massey and Mr Smythe could only be held responsible for conducting pre-start checks on those parts of the hoist rope which were visible to them at that time. Consequently, if there was damage to a part of the hoist rope which was either completely hidden by other rope on the winch drum or that was inaccessible to them because it was, for example, out on the crane jib, their failure to identify and report on this damage was acknowledged as reasonable.

[31] The evidence of Mr Sell in this respect is significant. Mr Sell stated: 10

“Inspection of the hoist rope is carried out on the counter-jib section of the crane. In that section, the hoist rope is more or less at eye level between the trolley system and the drum, which makes inspection in that section quite easy. I normally run my gloved hand along that section of the rope to detect any broken strands. I also look at the sections of the hoist rope that are visible on the winch.

On the day when I was filling in for Todd or Daniel, I noticed that the hoist rope was quite dry and some strands on the rope were starting to unravel. I noticed these signs all the way along from the cab to the winch.”

[32] Whilst I accept there are some inconsistencies between Mr Sell’s evidence and that of Mr Balfour relative to the lubrication of the rope, I have accepted Mr Sell’s evidence that damage to the rope was visible two weeks before Easter and that this damage was apparent in a part of the rope which was subject to a normal pre-start check. In that context, I do not consider it necessary that I make findings about the exact length of the damage to the hoist rope or that I make an assessment of the exact nature of that damage. It is enough that I conclude that damage, as distinct from birdcaging, was discernible in a pre-start check and that, given the safety significance of the hoist rope, it should have been identified in subsequent checks in the two weeks before Easter.

[33] A further significant difference between the parties goes to how the damage to the hoist rope was described and characterised to Mr Massey and to Mr Smythe. In the material before me the witnesses generally referred to damage to the hoist rope. Mr Seymour’s photographs focus particularly on the obvious damage to the rope which has been described in various ways including “birdcaging”. I am not satisfied that the information provided to H&Y by Select Plant, or the report undertaken by Mr Balfour, specifically addressed the less obvious damage. I have accepted the evidence of Mr Nunweek to the effect that this obvious damage or birdcaging may well have become apparent in that form only just before the crane stopped operating before the Easter break. That evidence appears to be consistent with that of a number of other witnesses in terms of the degree of vibration and noise associated with operation of the hoist rope in that condition such that it would have been obvious.

[34] I have concluded that the only evidence directly put to Mr Massey and to Mr Smythe about damage to the rope were the photographs taken by Mr Hennessey. I am not satisfied that the reports into the rope and Mr Nunweek’s investigation report were provided to Mr Massey or to Mr Smythe. It is clear that Mr Massey and Mr Smythe, and, for that matter various H&Y personnel, looked at the rope after it had been removed from the crane, but I am unable to determine what parts of the rope they looked at and there is clearly no consensus about damage other than the obvious damage or “birdcaging” area. Mr Nunweek’s evidence referred to the “damaged section of the hoist rope”. 11 I am not persuaded that Mr Massey and Mr Smythe conceded that the photographs taken by Mr Hennessey showed damage beyond the obvious or “birdcaging” area. In this respect I have noted that neither Mr Friday, Mr Hennessey nor Mr Balfour identified defects in the rope other than that obvious area shown in the photographs. I have concluded that, whilst H&Y personnel, including Mr Kerpiniotis and Mr Nunweek may have adopted the position that the damage to the rope was over an extensive length, I am not certain that this was established to Mr Massey or Mr Smythe in the course of the various discussions about the matter. Further, it is now clear that at least one of the photographs preceded operation of the crane. I am not persuaded that this was made clear to Mr Massey and Mr Smythe in the course of these discussions. That issue becomes relevant given the evidence now before me about the potential effect of the removal of tension from the rope on its appearance. I have particularly noted the letters of allegations provided to Mr Massey and Mr Smythe which are substantially directed at the obvious or “birdcaging” areas. I have concluded that uncertainty about the nature of the damage that was the subject of the discussions involving Mr Massey and Mr Smythe impacted on the discussions and consideration of the incident.

[35] Mr Smythe had received a formal warning in December 2013. I have concluded that, whilst H&Y personnel were aware of this warning, it did not represent a contributing factor in the decision to terminate his employment. That is clear from the evidence of Mr Kerpiniotis.

[36] Section 387 states:

“387 Criteria for considering harshness etc.

In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:

(a) whether there was a valid reason for the dismissal related to the person’s capacity or conduct (including its effect on the safety and welfare of other employees); and

(b) whether the person was notified of that reason; and

(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and

(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and

(e) if the dismissal related to unsatisfactory performance by the person—whether the person had been warned about that unsatisfactory performance before the dismissal; and

(f) the degree to which the size of the employer’s enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(h) any other matters that the FWC considers relevant.”

[37] I have considered each of these factors in the circumstances of these applications.

Valid Reason

[38] Notwithstanding subsequent changes to the legislation which mean that various elements of the concept of a valid reason are now separately identified, I have adopted the general approach set out by Northrop J in Selvachandran v Peterson Plastics Pty Ltd. 12

[39] The evidence of Mr Sell establishes that damage to the hoist rope was visible two weeks prior to the Easter break. I have concluded that damage should have also been apparent to Mr Massey and Mr Smythe prior to Easter and their failure to identify this and report on it, as part of the pre-start checks is properly described as misconduct and represents a valid reason for the termination of their employment. This was a substantial omission which could have had catastrophic safety implications. In reaching this conclusion I have noted that Mr Massey and Mr Smythe are both experienced crane operators and I am satisfied that tower crane operators have significant responsibilities so as to ensure that necessary safety checks are carried out. Notwithstanding this, had it not been for the evidence of Mr Sell relative to the visibility of the hoist rope damage, I may well have arrived at a different conclusion because of the somewhat surprising uncertainty about the nature of the hoist rope checking obligations which are expected of tower crane operators. However, the evidence of Mr Sell confirms that there was a valid reason for the termination of Mr Massey and Mr Smythe’s employment.

Notification of the Reason

[40] Mr Massey and Mr Smythe were advised that the termination of their employment reflected the investigation into the allegations made against them. This particularly included the allegation that they had not completed the required necessary pre-start checks that they had certified were undertaken and that they had operated the crane with the wire rope in a clearly deteriorated state. 13 Whilst I am satisfied that this advice confirms the reason for the termination of Mr Massey and Mr Smythe’s employment, it does not address the extent to which it was the less obvious hoist rope which was relied on by H&Y as the basis for the employment terminations. The allegations formally put to Mr Massey and Mr Smythe and the letters of termination did not make the significance of this less obvious damage clear.

Opportunity to respond

[41] I am satisfied that both Mr Massey and Mr Smythe had an opportunity to respond to the allegations against them. However, that opportunity to respond was inherently limited by uncertainty about the nature and extent of the damage to the rope and the allegations in the correspondence of 30 April 2014 which made specific reference to the obvious or “birdcaging” damage. The opportunity to respond was also inherently limited by the reliance on the photographs, uncertainties about when they were taken and, even in the hearing before me, about what they actually depicted in terms of damage to the hoist rope. It was also limited by lack of access to the reports prepared relative to the rope and to the incident.

Unreasonable refusal to allow a support person

[42] Mr Massey and Mr Smythe had access to a support person throughout the disciplinary investigation process. This factor is not indicative of any unfairness in the termination decisions.

Warnings about unsatisfactory performance

[43] Mr Smythe had previously received a warning relative to his conduct as a tower crane operator. I am satisfied that, whilst this warning may well have been appropriate, it was not taken into account in the termination of employment decision. Notwithstanding this, in reaching a conclusion about whether the termination of Mr Smythe’s employment was harsh, unjust or unreasonable, I have taken that warning into account.

Size of the H&Y enterprise - impact on procedures

[44] I am satisfied that H&Y is a substantial employer and has sophisticated procedures for dealing with issues such as this. Consistent with my earlier comments, I would have expected those procedures to have remedied the deficiencies in the nature of the allegations put to and discussed with the applicants.

Absence of dedicated human resource management expertise

[45] H&Y has dedicated human resource management expertise which was available to assist it in dealing with this matter.

Any other matters considered relevant

[46] I have noted that, had Mr Sell properly completed the logbook entry when he observed damage to the hoist rope some two weeks prior to the Easter break, or, had Mr Hennessey acted immediately on being told, by Mr Sell, of the rope damage, that damage could have been addressed and hence the potential for catastrophic consequences or, even the termination decisions, could have been avoided.

Conclusion - harsh, unjust or unreasonable

[47] I have concluded that the termination of Mr Massey and Mr Smythe’s employment was not harsh in that they did not satisfactorily complete a critical inherent part of the job function so as to avoid potential catastrophic safety consequences. Notwithstanding this, I have concluded that these employment terminations were unjust in terms of the investigation process and the uncertainties about the nature and the location of the damage to the hoist rope which affected Mr Massey and Mr Smythe’s capacity to properly respond to the allegations put to them. Had those allegations been more specific, had the damage to the rope been established or agreed in terms of what they should have seen and its location, I may well have arrived at a different position. I do not consider that the termination of Mr Massey and Mr Smythe’s employment was unreasonable given their role and responsibilities and the substantial experience that both persons had in this occupation. Leaving aside issues associated with how the damage was characterised and where it was located, the process followed by H&Y appears consistent with the concept of a “fair go all-round”.

[48] Consequently, because of my finding that the termination of Mr Massey and Mr Smythe’s employment was unjust, I have concluded that their employment terminations were unfair.

Remedy

[49] In these circumstances s.390 establishes the approach which must be applied to consider an appropriate remedy. The primary remedy prescribed is that of reinstatement. In these matters this is conceded as impractical because the NRAH has progressed to the point where tower cranes have, or are in the process of being demobilised. Specifically, the advice provided to me is that Tower Crane 1B was demobilised and removed from the site on 12 September 2014. 14 Accordingly, I have considered an award of compensation in lieu of reinstatement. Such an award is appropriate given my finding of injustice.

[50] Section 392 specifies the criteria to which I am required to have regard in determining an amount of compensation. I have considered each of these factors.

[51] I am satisfied that an order of the magnitude being considered would not impact on the viability of the H&Y enterprise. Mr Massey was employed from September 2011 until 30 April 2014. I consider that to be a reasonable period of employment in the building and construction industry. Mr Smythe was employed from January 2012 to 23 May 2014. Again, I consider that to be a reasonable period of employment in this industry.

[52] Had Mr Massey and Mr Smythe not been dismissed I have concluded that their employment would have ended on or around 12 September 2014 when the Tower Crane 1B was demobilised. I accept the evidence of Mr Jarman to the effect that other suitable positions are not available within H&Y.

[53] The efforts made by Mr Massey and Mr Smythe to mitigate their losses since the termination of their employment have not been challenged by H&Y with the exception that H&Y asserted that I should take into account income earned by Mr Massey since he established his own business undertaking house inspections. Mr Massey’s evidence was that he borrowed heavily to establish this business and has earned minimal income since establishing it. I have determined that, taking into account substantial business establishment costs and the evidence of little current income from this business, it does not involve a significant amount. Consequently, I have not deducted any amount for income earned over this period and do not consider that any income could reasonably be expected to be earned until the actual payment of the compensation being considered.

[54] The only other matter I consider relevant to the amount of compensation relates to s.392(3) and the extent to which Mr Massey and Mr Smythe’s misconduct contributed to the decision to dismiss them. In considering this issue, I have already noted that, had Mr Sell or Mr Hennessey acted earlier, this matter may well have been addressed earlier and, possibly, in a different manner. Notwithstanding this, and taking this misconduct into account, I consider that a one half deduction in the amount which would otherwise be payable is appropriate.

[55] I have applied the approach adopted in Sprigg v Paul’s Licensed Festival Supermarkets 15 on the basis of my findings above. I have deducted, from the total that I would otherwise have arrived at, an amount of 15% for contingencies. On this basis I have determined that the amount of compensation payable to Mr Massey should be 6.5 weeks pay at his ordinary time rate of pay. The amount of compensation payable to Mr Smythe should be 7 weeks pay at his ordinary time rate of pay.

[56] An Order (PR556149) giving effect to this decision will be issued.

SENIOR DEPUTY PRESIDENT

Appearances:

A Allen counsel for the Applicants.

K Clark counsel for the Respondent.

Hearing details:

2014.

Adelaide:

September, 22 and 23

 1   U2014/10027

 2   U2014/10198

 3   Exhibit A1, letter to applicants dated 30 April 2014

 4   Exhibit A1, termination of employment letter of 23 May 2014

 5   Exhibit R2, Attachment CK3

 6   Exhibit R7, paras 7 - 9

 7   Exhibit R8, paras 7 - 10

 8   Exhibit R10, Attachment MN11

 9   Exhibit R6

 10   Exhibit R8, paras 9 and 10

 11   Exhibit R10, paras 31 and 40

 12 (1995) 62 IR 371 at 373

 13   Exhibit A1, Termination of employment letter of 23 May 2014

 14   Exhibit R3, para 9

 15   AIRC, Print R0235, (24 December 1998)

Printed by authority of the Commonwealth Government Printer

<Price code C, PR556148>