Vincent Fry v Queensland Rail

[2018] FWC 7449

[2018] FWC 7449

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.394—Unfair dismissal

Vincent Fry
v
Queensland Rail
(U2018/8429)

DEPUTY PRESIDENT CLANCY MELBOURNE, 7 DECEMBER 2018

Application for an unfair dismissal remedy – application dismissed.

[1] On 14 August 2018, Mr Vincent Fry made an application to the Fair Work Commission (the Commission) for unfair dismissal remedy under s.394 of the Fair Work Act 2009 (the Act).

[2] In his Form F2 – Unfair Dismissal Application (Form F2), Mr Fry stated that his employment had been terminated by Queensland Rail on 3 August 2018, with the dismissal also taking effect the same day.

[3] In responding to Mr Fry’s contentions that his dismissal was unfair in the Form F3 – Employer Response to Unfair Dismissal Application (Form F3), Queensland Rail outlined its position that:

a) Mr Fry had a pattern of inappropriate conduct in the workplace;

b) Mr Fry had been given a final warning in June 2017;

c) Allegations that Mr Fry acted in an aggressive and disrespectful manner on 12 and 14 July 2017 were substantiated through a workplace investigation; and

d) Mr Fry admitted on 12 July 2017 that he had painted over a “Keep Clear” floor sign in his work area without authorisation.

[4] Further, Queensland Rail relied on the information outlined in the termination letter to Mr Fry, which included the statement that it had lost trust and confidence in his ability to adhere to its Code of Conduct and Values and specifically, the expectation that all employees treat each other with respect at all times.

Conciliation

[5] At the telephone conciliation before a Commission conciliator on 11 September 2018, the parties appeared to reach a settlement agreement. This was confirmed in correspondence the conciliator sent to the parties the following day on 12 September 2018, which stated:

“Thank you for your participation in today’s [sic] conciliation in the above matter. I confirm that you reached a settlement agreement and I confirm that the terms of settlement are to be sent out by the Respondent.”

[6] On 17 September 2018, Mr Fry attempted to contact the Commission conciliator by telephone. He left a voicemail message seeking the conciliator’s return call. Following this, Mr Fry emailed the Commission conciliator advising that he was “not happy with” the terms of settlement sent to him by Queensland Rail, and querying whether he could send a copy of the terms of settlement and his proposed terms for consideration.

[7] Later the same day, the Commission conciliator replied to Mr Fry’s email stating that advice could not be given on the terms of settlement. However, the Commission conciliator offered to indicate whether the terms were a “standard document” and offered to speak to Queensland Rail about his concerns. In response to this, Mr Fry sent an email to the Commission conciliator attaching Queensland Rail’s terms of settlement and his proposed variations. These included that Queensland Rail would recognise he had retired effective 3 August 2018 “with all entitlements” and would not pursue an alleged overpayment of approximately $4000.00. According to the Commission’s records, it does not appear that the Commission conciliator responded to this email of Mr Fry.

[8] On 19 October 2018, Mr Fry telephoned the Commission and advised that he wished to proceed to a further conciliation. Upon being informed by the Commission staff member that this was unlikely to occur, Mr Fry then advised that he wished for his matter to proceed to a hearing.

[9] On 23 October 2018, the Commission telephoned Mr Fry to advise that his matter was closed and that if he wished to reopen his matter, he was required to send a request via email. The Commission subsequently received an email from Mr Fry later the same day, which stated:

“Agreement with Queensland Rail has broken down, they offered to change the Termination to a RECOGNIZED RETIREMENT, but will not pay the retirement allowance or the gold watch.”

[10] Following this, a further email was received from Mr Fry stating:

“I would prefer to go back to conciliation, but have no problems allowing the tribunal to make a ruling”

[11] On 1 November 2018, the Commission telephoned Mr Fry and confirmed that he had not signed the terms of settlement.

[12] On 2 November 2018, the Commission emailed correspondence dated 1 November 2018 to the parties to advise that the matter had been referred to me in my capacity as Panel Head – Termination of Employment. This correspondence stated:

“We understand the Applicant wishes to have his unfair dismissal application heard and determined. Our records show that this matter was settled at a conciliation conducted by the Commission on Tuesday, 11 September 2018 and correspondence to that effect was provided to the parties on Wednesday, 12 September 2018.

In light of this, the Deputy President is considering whether he should, of his own motion, dismiss Mr Fry’s application under s.587 of the Fair Work Act 2009 because it has no reasonable prospects of success.

He refers the parties to the decision of the Full Bench in Curtis v Darwin City Council [2012] FWAFB 9021 which referred to the decision of the Federal Court in Australian Postal Corporation v Gorman [2001] FCA 975 which is authority for the proposition that if there is a binding agreement between parties to an unfair dismissal application then the application has no reasonable prospects of success and may be dismissed.

Prior to deciding whether he should dismiss this application the following directions are made.

The Applicant is to file and serve by close of business on Thursday, 8 November 2018 submissions and evidence as to whether a binding settlement agreement was reached between the parties and whether the application should or should not be dismissed on the basis that it has no reasonable prospects of success.

The Respondent is to file and serve by close of business on Thursday, 15 November 2018 submissions and evidence as to whether a binding settlement agreement was reached between the parties and whether the application should or should not be dismissed on the basis that it has no reasonable prospects of success.”

Submissions of Mr Fry

[13] On 7 November 2018, Mr Fry sent email correspondence to the Commission attaching a six page letter addressed to me, which outlined his understanding of the settlement reached at conciliation as well as the background to his alleged unfair dismissal. On 8 November 2018, additional documents were received from Mr Fry via express post including two documents titled “Unfair DISSMISSAL [sic]” and “Calendar of Events”, as well as various excerpts from Queensland Rail policies, letters and investigation summaries.

[14] In his material, Mr Fry submits he agreed to a settlement on 12 September 2018 after the conciliation on 11 September 2018 and it consisted of:

“1. A recognised retirement taking effect on the 03/08/2018.

2. A 25year ex- employee rail pass.”

[15] Mr Fry submits that he had issues with the initial terms of settlement drafted by Queensland Rail dated 13 September 2018 and that another terms of settlement document dated 24 September 2018 was drafted, which he was satisfied with until he enquired about the retirement benefits. He claims that if the termination of his employment is a “Recognised Retirement”, it comes with a retirement allowance and a gold watch.

[16] Mr Fry submits that if Queensland Rail agreed to the “full recognised retirement”, the matter would come to an end.

Submissions of Queensland Rail

[17] On 15 November 2018, Queensland Rail filed its submissions in response to Mr Fry’s application. The documents filed included an Outline of Submissions plus ten attachments.

Sequence of events

[18] Queensland Rail says that at the conciliation on 11 September 2018, Mr Fry sought financial compensation and the ability to change his dismissal to a retirement. It asserts that the offers made to Mr Fry consisted of either financial compensation or a resignation, but not both. It asserts that it agreed to allow the record to reflect a “resignation/retirement” on the basis that Mr Fry’s primary concern was the “appearance” of dismissal after so many years of service.

[19] Queensland Rail asserts that the final offer put forward to Mr Fry to settle the matter consisted of the following:

“(a) Ability for the Applicant’s record to reflect “resign” (“retire” given the Applicant’s age);

(b) Statement of Service;

(c) Provision of a 25 Year Service Ex-Employee Pass;

(d) Commitment that the Respondent would not seek to recover an overpayment of wages totalling approximately $4,500;

(e) Requirement for the Applicant to return any property of the Respondent he had in his possession;

(f) Documented in the Respondent’s standard Terms of Settlement template which includes clauses regarding:

i. Release by both the Applicant and the Respondent;

ii. Confidentiality; and

iii. Non-Disparagement.”

[20] Queensland Rail contends that Mr Fry requested 24 hours to consider its final offer and that on the next day, 12 September 2018, Mr Fry confirmed via email that he accepted the offer. 1

[21] Consistent with Mr Fry’s account, Queensland Rail says the first draft terms of settlement were sent to Mr Fry on 13 September 2018. It says that Mr Fry contacted it by telephone on 18 September 2018 to request some variations to the terms of settlement as follows:

a) Inclusion of “and will be treated as such” in subclause 3.1.

b) Removal of subclause 3.2, as he did not require a statement of service.

c) Removal of reference to “Ipswich workshop keys” in subclause 3.3, as he did not believe he had these in his possession.

d) Removal of the timeframe for him to return his home and duty pass in subclause 3.3, because he would return this when he collected his toolbox;

e) Removal of subclause 3.4 as he still had in his possession a 25 year Service Ex-Employee Rail Pass and this entitlement would be recorded in Queensland Rail’s payroll system.

f) Removal of subclauses 3.5, 3.6 and 3.7 regarding releases, to enable him to make a formal unpaid wages claim and Queensland Rail to seek to recover any overpayments.

[22] As can be seen, one of the variations Mr Fry sought was that Queensland Rail recognise he has retired “and will be treated as such”. Queensland Rail says it did not agree to this because it held the view that the subclause 3.1 it had drafted recognised that Mr Fry had retired. As to the other variations sought, Queensland Rail was prepared to agree to those outlined in paragraph [21](b)-(e) above and stated it was willing to include an exception to the release clauses to enable both it and Mr Fry to seek to recover any alleged underpaid/overpaid wages (in response to the requested amendment outlined in paragraph [21](f) above).

[23] Terms of settlement signed by Queensland Rail with these variations were sent to Mr Fry on 24 September 2018 with a request that Mr Fry sign and return them if he agreed with them. 2 Mr Fry did not.

[24] Queensland Rail says that Mr Fry contacted it via email on 26 September 2018, querying whether a “retirement allowance” was included in the agreement. It responded the following day, advising Mr Fry that he would not be entitled to a retirement allowance and asserted this had not been discussed as part of the settlement negotiations.

[25] Subsequent emails were exchanged between Queensland Rail and Mr Fry between 27 September 2018 and 5 October 2018, whereby Mr Fry claimed that the settlement position consisted of a 25 year rail pass, a gold watch and a retirement allowance, while Queensland Rail asserted that the settlement position did not include the payment of a retirement allowance or a gold watch.

Binding settlement

[26] Queensland Rail submits that the Commission should dismiss Mr Fry’s application on the basis that parties have reached a binding settlement agreement of a kind described in Masters v Cameron. 3

[27] Queensland Rail submits that the agreement falls into either the Masters v Cameron category two or, in the alternative, category one. It submits that during the conciliation, there was a clear desire of the parties to cover all of the inclusions meant for the formation of a binding contract and that this was only subject to a 24 hour “cooling off” period, during which Mr Fry confirmed his acceptance of the offer. It further submits that there was no intention for additional material to be added to the accepted offer.

[28] Queensland Rail also relies on Curtis v Darwin City Council 4 in support of its contention that Mr Fry remains bound by the agreement that has been made, even if there are no signed terms of settlement. It submits that Mr Fry is attempting to imply terms into a settlement agreement, of which the terms were expressly discussed at conciliation and subsequently agreed to, in writing, on 12 September 2018.

Consideration

[29] While Mr Fry has made various assertions with regard to his alleged unfair dismissal in the material he filed, the issue for me to determine in deciding whether this matter should be reopened is whether a binding settlement agreement has been reached between Mr Fry and Queensland Rail.

[30] In Masters v Cameron, the High Court held that a binding agreement could come about in the following manner:

“Where parties who have been in negotiation reach agreement upon terms of a contractual nature and also agree that the matter of their negotiation shall be dealt with by a formal contract, the case may belong to any of three classes. It may be one in which the parties have reached finality in arranging all the terms of their bargain and intend to be immediately bound to the performance of those terms, but at the same time propose to have the terms restated in a form which will be fuller or more precise but not different in effect. Or, secondly, it may be a case in which the parties have completely agreed upon all the terms of their bargain and intend no departure from or addition to that which their agreed terms express or imply, but nevertheless have made performance of one or more of the terms conditional upon the execution of a formal document. Or, thirdly, the case may be one in which the intention of the parties is not to make a concluded bargain at all, unless and until they execute a formal contract.

In each of the first two cases there is a binding contract: in the first case a contract binding the parties at once to perform the agreed terms whether the contemplated formal document comes into existence or not, and to join (if they have so agreed) in settling and executing the formal document; and in the second case a contract binding the parties to join in bringing the formal contract into existence and then to carry it into execution.” 5

[31] There are three matters in particular that persuade me that a binding settlement was agreed during the conciliation on 11 September 2018 in the terms asserted by Queensland Rail.

[32] Firstly, Mr Fry’s email to the Commission conciliator and Queensland Rail at 1:14PM on 12 September 2018 6 stating “it is with regret that I ACCEPT Queensland Rails [sic] offer of the 12/09/2018 for the unfair dismissal case started by me” suggests that Mr Fry had accepted, albeit with a seemingly heavy heart, Queensland Rail’s settlement offer in terms of a resignation/retirement without compensation, and that he had accepted he would not be able to have both elements.

[33] Secondly, while there have been no findings of fact made in relation to the merits of Mr Fry’s application for unfair dismissal remedy under s.394 of the Act, the tenor of Queensland Rail’s position, as outlined in the Form F3 and termination letter persuades me its proposition, that what was agreed at conciliation was that Mr Fry’s termination be characterised as a resignation/retirement without payment of compensation, is more plausible than the proposition Mr Fry seeks to persuade me to accept (i.e. that the agreement to describe the termination as a retirement included the associated benefits of the payment of a retirement allowance and provision of a gold watch).

[34] Thirdly, that Mr Fry posed the question to Queensland Rail on 26 September 2018, “is the retirement allowance included with the agreement?” 7 suggests, as Queensland Rail asserted in a reply email the next day,8 the payment of a retirement allowance had not been discussed before then, let alone agreed.

[35] I have considered what Mr Fry stated in his emails to the Commission dated 17 September 2018. My interpretation of them is that by this time he had decided he was not happy with the terms previously agreed, his position had changed to one of wanting Queensland Rail to recognise him as having retired with all retirement entitlements and he wanted the Commission conciliator to consider this proposal.

[36] I am therefore satisfied that Mr Fry and Queensland Rail reached agreement at the conciliation on 11 September 2018 and that the settlement position was reflected in the terms of settlement document drafted by Queensland Rail and provided to Mr Fry on 13 September 2018. I am satisfied the agreement fell within either the first or second category described in Masters v Cameron and in either case, that there was a binding contract.

[37] Following the discussion on 18 September 2018, there were negotiations about possible variations to the settlement agreement in the manner outlined in the email from Queensland Rail to Mr Fry dated 24 September 2018 and its attached terms of settlement document. Agreement on these variations was not reached because Mr Fry did not sign the terms of settlement document sent on 24 September 2018 and nor did he advise he agreed. In these circumstances, the agreement reached at the conciliation on 11 September 2018 stands.

[38] In Australia Postal Corporation v Gorman 9, Besanko J held that the existence of a binding settlement or “accord and satisfaction” extinguishes the existing cause of action and replaces it with a new cause of action based on the agreement.10

[39] His Honour stated:

“[33] There is nothing in the Act which suggests that an accord and satisfaction should not be recognised. At a general level the object of Chapter 3 Part 3-2 and the general statements of the manner in which FWA is to perform its functions and the matters to which it is to have regard are consistent with the recognition of an accord and satisfaction. Furthermore, the words of subsection 587(1) are wide enough to include the recognition of an accord and satisfaction. As I have said, a valid and effective accord and satisfaction extinguishes the pre-existing cause of action and continued pursuit of an application based on such cause of action is clearly capable of being considered to be frivolous or vexatious or without reasonable prospects of success.” 11

[40] As can be seen from Australia Postal Corporation v Gorman, if there is a binding agreement between the parties, the Commission has the power under s.587(1) of the Act to dismiss an application on the basis that it has no reasonable prospects of success.

[41] Section 587(1) of the Act provides as follows:

“587 Dismissing applications

(1) Without limiting when the FWC may dismiss an application, the FWC may dismiss an application if:

(a) the application is not made in accordance with this Act; or

(b) the application is frivolous or vexatious; or

(c) the application has no reasonable prospects of success.”

[42] As I have found that the parties reached agreement at the conciliation on 11 September 2018 and I am satisfied that the agreement was of the first or second type discussed in Masters v Cameron,I am persuaded that I should exercise my power under s.587(1)(c) of the Act to dismiss the application on the basis that it has no reasonable prospects of success. The settlement agreement that was made is a complete answer to Mr Fry’s claim that he was unfairly dismissed.

[43] For the reasons outlined above, I find that Mr Fry entered into a binding settlement of his claim and therefore, his application for unfair dismissal remedy is dismissed. An Order to this effect will be issued in conjunction with this Decision.

DEPUTY PRESIDENT

Printed by authority of the Commonwealth Government Printer

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 1   Attachment 1 to the Outline of Submissions of Queensland Rail.

 2   Attachment 4 to the Outline of Submissions of Queensland Rail.

 3 [1954] 91 CLR 353.

 4   [2012] FWAFB 8021.

 5   Masters v Cameron [1954] 91 CLR 353.at 360.

 6   Attachment 1 to the Outline of Submissions of Queensland Rail.

 7   Attachment 5 to the Outline of Submissions of Queensland Rail.

 8   Attachment 6 to the Outline of Submissions of Queensland Rail.

 9 [2011] FCA 975.

 10 Ibid at [31].

 11 Ibid at [33].