Vong v Sika Australia Pty Ltd
[2011] FMCA 276
•18 April 2011
FEDERAL MAGISTRATES COURT OF AUSTRALIA
| VONG v SIKA AUSTRALIA PTY LTD | [2011] FMCA 276 |
| INDUSTRIAL LAW – Application under ss.807 and 841 of the Workplace Relations Act 1996 (Cth) for alleged contraventions of s.792 – termination for reasons that included a prohibited reason – contravention established. REINSTATEMENT, COMPENSATION & PENALTY – The parties were directed to file written submissions addressing these issues – agreement on reinstatement of the applicant together with all of his accumulated employment benefits – quantum of penalty agreed – this Court directs penalty to be paid to the National Union of Workers to cover costs of proceedings. |
| Workplace Relations Act 1996 (Cth), ss.792, 807(1)(a), 807(1)(b), 807(1)(c), 807(3)(b), 841(b) |
| Australian Municipal Administrative Clerical Services Union v Greater Dandenong City Council(No.2) [2001] FCA 1076 Lexis Nexis, Workplace Relations Australia, Vol 1, s.807.95 |
| Applicant: | PAULO VONG |
| Respondent: | SIKA AUSTRALIA PTY LTD (ACN 001 342 329) |
| File Number: | SYG 2401 of 2009 |
| Judgment of: | Lloyd-Jones FM |
| Hearing date: | 18 April 2011 |
| Delivered at: | Sydney |
| Delivered on: | 18 April 2011 |
REPRESENTATION
| Counsel for the Applicant: | Mr Joseph |
| Solicitors for the Applicant: | Slater & Gordon |
| Counsel for the Respondent: | Mr Warren |
| Solicitors for the Respondent: | Carroll & O’Dea Lawyers |
ORDERS
Pursuant to s.807(1)(c) of the Workplace Relations Act 1996 (Cth) that the applicant be reinstated in his former position with the respondent, effective 18 April 2011.
Pursuant to s.807(1)(c) of the Workplace Relations Act 1996 (Cth) that the applicant’s employment with the respondent be treated as continuous and not be taken as broken by the dismissal on 1 June 2009.
Pursuant to s.807(1)(b) of the Workplace Relations Act 1996 (Cth) that the respondent pay to the applicant an amount of $15,810.73 (minus appropriate tax) as compensation for lost wages.
Pursuant to s.807(1)(c) of the Workplace Relations Act 1996 (Cth) that the respondent re-credit the applicant with all leave entitlements held by the applicant in his employment immediately prior to his dismissal on 1 June 2009.
Pursuant to s.807(1)(a) that the respondent pay a penalty of penalty of $11,000 for contravening s.792 of the Workplace Relations Act 1996 (Cth).
Pursuant to s.841(b) that the penalty be paid to the National Union of Workers, New South Wales Branch.
| FEDERAL MAGISTRATES COURT OF AUSTRALIA AT SYDNEY |
SYG 2401 of 2009
| PAULO VONG |
Applicant
And
| SIKA AUSTRALIA PTY LTD (ACN 001 342 329) |
Respondent
REASONS FOR JUDGMENT
On 24 December 2010, I gave judgment in favour of the applicant in the decision Vong v Sika Australia Pty Ltd [2010] FMCA 1021. At that time I made the following declaration:
(1) The respondent contravene s.792 of the Workplace Relations Act 1996 (Cth) by dismissing the applicant from his employment with the respondent for a reason that included a prohibited reason under the Act.
At that time I also made the following orders:
(1) In relation to the issue of compensation and reinstatement, the parties are directed to confer in an attempt to reach agreement on these issues.
(2) If that conference fails to reach agreement, the parties are ordered to provide written submissions in respect to reinstatement, compensation and penalty. The applicant is to file and serve submissions by 14 February 2011, and the respondent to file written submissions in reply by 28 February 2011.
Detailed written submissions were filed by both parties in relation to the proposed orders.
On 15 April 2011, supplementary submissions were filed on behalf of the applicant, which indicated that following the filing of the written submissions referred to above the parties engaged in further discussions and managed to reach agreement in relation to most of the orders sought by the applicant in these proceedings.
Reinstatement
Mr Joseph, in his written submissions, sought reinstatement of Mr Vong to his former position with Sika Australia Pty Ltd. Sections 807(1)(c) and 807(3) of the Workplace Relations Act 1996 (“WR Act”) provide the basis for a reinstatement order. Despite there being no explicit reinstatement provision in s.807 (contrast s.298U(b) of the pre-2006 WR Act), the words of s.807(1)(c) and s.807(3) are wide and this supports the proposition that they are (at least) as broad as the repealed provisions: Workplace Relations Australia, Volume 1, published by Lexis Nexus Butterworths at s.807.95; Australian Municipal Administrative Clerical Services Union v Greater Dandenong City Council (No 2) [2001] FCA 1076 at [10].
Mr Joseph submits that the policy underlying the legislation is to protect freedom of association, including those persons who wish to be members of a union and avail themselves of the services provided by their union. This can only be properly done if unlawful actions (such as terminating a person’s employment because they were a union member) can be reversed. Section 807(3)(b) states:
(3) The orders that may be made under paragraph (1)(c) include:
(b) any other orders that the Court considers necessary to stop the conduct or remedy its effects.
In Rojas v Esselte Australia Pty Ltd (No 2) [2008] FCA 1585, the parties agreed that reinstatement was an order that could be made by the Court utilising the provisions in question. His Honour Moore J made such an order without further comment.
The conduct complained of in these proceedings is a contravention of s.792 and the effect of that conduct was the dismissal of Mr Vong. Up until the contravention of the Act, Mr Vong had been employed by Sika Australia for some 15 years. Mr Vong was rewarded for his diligence by promotion, and had no disciplinary record against him: [2010] FMCA 1021 at [88]. Mr Vong sought reinstatement in his application and maintained that desire at the time of the filing of written submissions in respect of this issue.
The contravention in this matter took place in circumstances where the management of Sika Australia was intending to investigate an alleged failure by Mr Vong to follow correct procedures in relation to the allocation of overtime. The process surrounding dismissal is relevant in showing this was a real and substantial rather than technical or trivial breach of the WR Act. Ms Litsis who was retained as the Human Resources Manager, with the support of senior management of Sika Australia, set out to impose a policy that had the effect of denying employees (including Mr Vong) the basic right of union representation in disciplinary hearings:[2010] FMCA 1021 at [91]-[95]. Mr Vong (for whom English was a second language) clearly told Ms Litsis and other members of senior staff at Sika that he did not have the knowledge or experience to represent himself and that is why he wanted his union organiser Mr Bruno Mendonca from the National Union of Workers to advise and assist him during an investigation hearing: [2010] FMCA 1021 at [89]-[90].
Mr Joseph, in his written submissions, indicates that the judgment at [95] infers that Ms Litsis may have been somewhat ignorant of the relevant provisions of the Act. Mr Joseph makes the submission that even if the contravention is seen as a result of ignorance rather than a deliberate act, a substantial penalty may still be appropriate. In Finance Sector Union v Australian & New Zealand Banking Group Ltd [2002] FCA 1035 it was argued by the respondent that the contravention there had arisen not because of some deliberate act but due to the inexperience of the junior manager (at [5]). His Honour Wilcox J found that simply because the person acting on behalf of the bank may not have known that they were breaching the act they should have known (at [12]).
Mr Joseph contends that Ms Litsis was clearly acting with the informed consent of senior management. Mr Peter Scott (who filed an affidavit in the proceedings but was not available for cross examination) is Sika Australia’s General Manager and he signed the dismissal letter to Mr Vong: [2010] FMCA 1021 at [30]. That correspondence set out all the material elements proved in the proceedings some of which speak of unlawful conduct. The involvement of senior management was seen as an aggravating factor by Her Honour Branson J in Construction, Forestry, Mining & Energy Union v Coal & Allied Operations (No.2) (1999) 94 IR 231 at [11]-[12]. I fully agree with the written submissions made by Mr Joseph that the consequences of the conduct of senior management are also relevant. Here the consequences for Mr Vong were dire. He was terminated from his employment simply for asking for representation at an important meeting. Mr Vong who was clearly a valued and respected employee with no previous disciplinary proceedings or warnings against him became the victim of an irrational and pointless dispute between the Human Resources Manager, Ms Martina Litsis and the National Workers Union and particularly its organiser Mr Bruno Mendonca.
It would be assumed that whatever educational background, technical or tertiary that Ms Litsis has undertaken in order to hold down her position as a Human Resources Manager would have a primary focus into how the relationship between the organisation that she represents and the union movement that represents a substantial part of the workforce retained by her employer would be focused on the mature and harmonious relationship between these parties. Further without turning a page of the new act, a person in her role would be expected to handle the set of circumstances of which she was faced with for this brief period of the dispute. This Court unfortunately sees too many instances similar to the matters in this case are inappropriately and incompetently approached by persons who parade under the banner of Human Resources specialists.
I am comforted by the written submissions submitted by Mr Warren, Counsel representing Sika Australia indicating that the organisation has implemented a number of changes to its management structure, policies and procedures since the termination of Mr Vong’s employment in June 2008. Specifically, Ms Martina Litsis held the position of Human Resources Manager for Sika during the time of the relevant events in this case in 2009 but resigned effectively 4 April 2010. Ms Litsis has not been replaced and the Human Resources matters within Sika at the Wetherill Park premises are now handled by Mr Alexandre Buckoski De Souza who is the Operations Manager.
Mr De Souza, in his affidavit sworn 2 March 2011 and filed in conjunction with the written submissions, indicates that there has been a marked change in the attitude of Sika Australia to trade union representation of its members in the workplace. Mr De Souza refers to two disciplinary meetings held at the company’s premises in August and November 2009 where Mr Mendonca, the organiser from the NUW, represented and spoke on behalf of his employee members at disciplinary hearings. A further indication of the improved relationship between Sika Australia and NUW is represented by a recently negotiated enterprise agreement with the NUW. Annexed to Mr De Souza’s affidavit is a copy of that agreement which recognises the validity of union representation in dispute settlement procedures, particularly the contents of cl.45 of that agreement.
Mr Warren, in his written submissions, also indicates that on 1 March 2011, Sika Australia formalised an offer of reinstatement for the employment to Mr Vong in his former position as team leader. Further details of the offer and reinstatement, including continuity of employment from the date of termination were contained in that offer. During the hearing on these matters now before the Court, Mr Joseph advised that Mr Vong had recommenced his employment that morning.
In these circumstances, I congratulate the parties on the resolution of the dispute by the reinstatement of Mr Vong to his previously held position of team leader for the admixture area at the Wetherill Park plant and the reinstatement of all of his employment entitlements.
Penalty
The parties have advised that they have agreed between themselves to recommend to the Court that the quantum should be fixed in the amount of $11,000 for the contravention of s.792 of the WR Act. In adopting this position, they have taken into account the relevant principles that the Court should adopt when considering appropriate penalty. The submissions refer the Court to a recent statement by Her Honour Kenny J in White v Construction, Forestry, Mining & Energy Union [2011] FCA 192 at [5]-[6] where Her Honour states:
[5] The parties agreed, and I accept, that the proper approach of the court in respect of an agreed submission as to the quantum of the penalty is that described in Minister for Industry, Tourism & Resources v Mobil Oil Australia Pty Ltd [2004] FCAFC 72 (Mobil). In summary in Mobil the Full Court (constituted by Branson, Sackville and Gyles JJ) said (at [51]):
(a) it is the responsibility of the court to determine the appropriate penalty;
(b) determining the amount of penalty is not an exact science;
(c) within a permissible range, the courts have acknowledged that a particular figure cannot necessarily be said to be more appropriate than another;
(d) there is public interest in promoting settlement of litigation, particularly where it is likely to be lengthy;
(e) the view of the regulator, as a specialist body, is a relevant, but not determinative, consideration;
(f) in determining whether the proposed penalty is appropriate, the court examines all of the circumstances of the case; and
(g) where the parties have jointly proposed a penalty, it will not be useful to investigate whether the court would have arrived at that precise figure in the absence of agreement. The question is whether that figure, in the court’s view, is appropriate in the circumstances of the case. In answering that question, the court will not reject the agreed figure simply because it would have been disposed to select some other figure. It will be appropriate if it is within the permissible range.
[6] Courts exercising a jurisdiction of the present kind have identified a range of factors that may be relevant in assessing the appropriate penalty in the circumstances of the particular case. However, as Buchanan J noted in Australian Opthalmic Supplies Pty Ltd v McAlary-Smith (2008) 165 FCR 560 at 580, “[a]t the end of the day the task of the Court is to fix a penalty which pays appropriate regard to the circumstances in which the contraventions have occurred and the need to sustain public confidence in the statutory regime which imposes the obligations”.
Payment of Penalty
Mr Joseph, in his written submissions, sought an order for the payment of a penalty to the National Union of Workers, NSW Branch. In support of this submission, Mr Joseph indicated that the costs these proceedings have been borne by the National Union of Workers, NSW branch for Mr Vong’s and requests that any order in respect of penalty imposed on Sika Australia be paid to the NUW in accordance with s.841(b) of the Act.
Mr Joseph brings to the Court’s attention that unions cannot bring these proceedings as applicants unless the union alleges some detriment to itself. It is recognised that representative bodies have an important role to play in ensuring compliance with the WP Act, particularly where individuals would generally be unable to fund such litigation: CPSU v Telstra Corporation Ltd (2001) 108 IR 228 per Finkelstein J at [22]-[28]; CPSU v Commonwealth of Australia [2007] FCA 1634 per Branson J at [22]-[24]; Financial Sector Union v Commonwealth Bank of Australia (2005) 147 IR 462 per Merkel J at [15]-[17].
Mr Joseph acknowledges that these proceedings are undertaken in an environment where costs orders are generally not available (s.84 of the WP Act). Nevertheless once a decision is made to impose a penalty, there is no reason why the penalty ought not to be paid to the organisation that brought the unlawful conduct to the Court’s attention. Section 841 provides an express power in the Court to do so: Rojas v Esselte Australia Pty Ltd (supra) at [68]-[69]. Further, I am satisfied that there is no suggestion that such an order would provide a windfall for the NUW. Mr Warren indicated that Sika Australia did not consent to the payment to be made to the NUW but preferred to leave it in the Court’s hands.
In the circumstances it is appropriate that the NUW who retained independent solicitors and counsel to represent Mr Vong should be compensated for this undertaking for the reason that a two day contested hearing was required where Mr Vong had been terminated in breach of the WR Act.
I certify that the preceding eighteen (18) paragraphs are a true copy of the reasons for judgment of Lloyd-Jones FM
Date: 28 April 2011
0
10
1