Zlatko Dudic and Secretary, Department of Education, Employment and Workplace Relations
[2012] AATA 425
•6 July 2012
[2012] AATA 425
Division GENERAL ADMINISTRATIVE DIVISION File Number
2012/0568
Re
Zlatko Dudic
APPLICANT
And
Secretary, Department of Education, Employment and Workplace Relations
RESPONDENT
DECISION
Tribunal Deputy President R P Handley
Date 6 July 2012 Place Sydney Decision Summary
The decision under review is affirmed
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Deputy President R P Handley
CATCHWORDS
FAMILY ASSISTANCE AND SOCIAL SECURITY – eight week non-payment period – newstart allowance – participation payment – cessation of employment – whether voluntary act of employee – whether employee was dismissed – decision affirmed
LEGISLATION
Social Security Act 1991
Social Security (Administration) Act 1999
Social Security (Administration) (Ending Unemployment Non-payment Periods — Classes of Persons) (FaHCSIA) Specification 2009 (No. 1)
REASONS FOR DECISION
Deputy President R P Handley
Mr Dudic has applied for the review of a decision to impose an eight-week non-payment period in respect of the payment of Newstart Allowance (NSA).
BACKGROUND
Mr Dudic was born in 1965 and is aged 46. He has been intermittently in receipt of NSA since April 2007. On 19 September 2011, Mr Dudic’s Employment Service Provider (ESP), Mission Australia, placed Mr Dudic in employment with Drake International (‘Drake’) as a labourer. Drake then sub-contracted Mr Dudic to the company True Energy.
On 6 October 2011, Mission Australia advised Centrelink that Mr Dudic had ceased employment with Drake. Ms Elle Rushworth from Mission Australia said to Centrelink she was told by a representative of Drake that Mr Dudic had written the word ‘sux’ under the name Drake on his work issue hard hat, had been “caught reading private and confidential information in the Administration Office on a workers (sic) desk”, and had failed to attend work on 30 September 2011. Ms Rushworth said she was also informed that Mr Dudic had been spoken to on earlier occasion when he appeared to be under the influence of alcohol or extremely hung over while at work, and was spending too much time talking with other employees. He was to be breath tested prior to each work shift commencing on Monday 3 October 2011.
A Centrelink delegate spoke to a representative from True Energy, Mr Robyn Berkeley, about the circumstances leading to the cessation of Mr Dudic’s employment. Mr Berkeley said he had spoken to Mr Dudic on Thursday 29 September 2011 about his behaviour at work, including Mr Dudic’s writing the word “sux” under the name Drake on his hard hat, and his being caught reading private and confidential information on a worker’s desk in the Administration office. Mr Berkeley said he did not dismiss Mr Dudic or even give him a formal warning. Because Mr Dudic was employed by Drake and not by True Energy, Mr Berkeley said he was, in any event, not authorised to dismiss him.
The Centrelink delegate also spoke with Mr Dudic, who acknowledged he had written “sux” on his hard hat and that he had lent over the reception desk while waiting in the office and had read some brochures on the desk. However, Mr Dudic denied reading any private or confidential material. He said that after receiving a warning from Mr Berkeley, he had considered himself effectively dismissed and therefore did not attend for work the next day (30 September 2011).
Due to the above evidence, the Centrelink delegate formed the view that Mr Dudic had left the employment with Drake voluntarily without sufficient reason and, on 10 October 2011, decided to impose an eight-week non-payment period in respect of the payment of NSA to Mr Dudic. However, the commencement of the non-payment period was stayed pending the outcome of a review of the decision requested by Mr Dudic.
On 29 November 2011, the decision was affirmed by an Authorised Review Officer and, on 5 January 2012, by the Social Security Appeals Tribunal (SSAT). On 14 February 2012, Mr Dudic applied to the Administrative Appeals Tribunal for a review of the SSAT decision and also for a ‘Stay’ of that decision. Mr Dudic’s application for a Stay was not opposed by the Secretary of the Department of Education, Employment and Workplace Relations (the Department) and, on 2 March 2012, the Tribunal granted the Stay.
THE RELEVANT LEGISLATION AND ISSUES
Section 42S of the Social Security (Administration) Act 1999 (the Administration Act) states:
Unemployment resulting from a voluntary act or misconduct
(1) A participation payment is not payable to a person for the period mentioned in subsection (3) if the Secretary determines that:
(a) the person is unemployed as a result (whether direct or indirect) of a voluntary act of the person; or
(b) the person is unemployed as a result of the person's misconduct as an employee.
Note: The Secretary may continue the participation payment pending the outcome of an application for review (see sections 131 and 145 of the Administration Act).
Limitations on determination
(2) Despite paragraph (1)(a), the Secretary must not make a determination under that paragraph if the Secretary is satisfied that the voluntary act was reasonable.
Period of non-payment
(3) The participation payment is not payable to the person for the period (the unemployment non-payment period) of:
(a) 8 weeks beginning on the initial day; or
(b) 12 weeks beginning on the initial day if, during the 6 months ending on the day immediately before the person becomes unemployed, the person has been paid relocation assistance in relation to the employment to which the voluntary act or misconduct related.
Note: The Secretary may end an unemployment non-payment period under subsection (4).
(3A) For the purposes of subsection (3), the initial day is:
(a) the day that the person becomes unemployed as a result of the person's voluntary act or misconduct; or
(b) …
(3B) …
Ending unemployment non-payment periods
(4) The Secretary may end a person's unemployment non-payment period if:
(a) the Secretary determines that serving the unemployment non-payment period would cause the person to be in severe financial hardship; and
(b) the person is in a class of persons specified by legislative instrument under subsection (5).
Note: For in severe financial hardship see subsection 14A(7) of the 1991 Act.
(5) For the purposes of subsection (4), the Secretary may, by legislative instrument, specify a class of persons.
The legislative instrument referred to in s 42S(4)(b) and (5) of the Administration Act is the Social Security (Administration) (Ending Unemployment Non-payment Periods — Classes of Persons) (FaHCSIA) Specification 2009 (No. 1) (the 2009 Legislative Instrument). Clause 4 states:
4 Specification of classes of persons
(1) For paragraph 42S(4)(b) of the Administration Act, the following classes of persons are specified:
(a) persons who have significant family and caring responsibilities, including persons with a dependent child;
(b) persons who have an illness, impairment or condition that requires treatment, and who cannot afford the treatment after meeting their essential expenses;
(c) persons who have a cognitive, neurological, psychiatric or psychological impairment or mental illness;
(d) persons who do not have access to safe, secure and adequate housing, or are using emergency accommodation or a refuge.
(2) Without limiting paragraph (1)(d), a person is taken not to have access to safe, secure and adequate housing if:
(a) the housing to which the person has access:
(i) damages, or is likely to damage, the person’s health; or
(ii) threatens or is likely to threaten the person’s safety; or
(iii) does not provide the person with access to a reasonable level of personal amenities or the economic and social support that housing normally affords; or
(b) in the circumstances, the adequacy, safety, security or affordability of the housing to which the person has access is adversely affected or may be adversely affected; or
(c) the person does not have a right to remain, or a reasonable expectation of being able to remain, in the housing to which the person has access.
Section 42A of the Administration Act states that ‘participation payments’ include NSA.
Section 14A(7) of the Social Security Act 1991 (the 1991 Act) states that “a person is in severe financial hardship if the value of the person's liquid assets does not exceed the person's maximum reserve”. The person’s ‘maximum reserve’ in relation to a person is defined in s 14A(1) of the 1991 Act as:
(a) if the person is not a member of a couple and does not have a dependent child--$2,500; or
(b) in any other case--$5,000.
ISSUES FOR THE TRIBUNAL
The issues for the Tribunal in determining whether Mr Dudic is subject to a non-payment period are:
(a)whether Mr Dudic’s leaving his employment was a voluntary act; and
(b)whether that voluntary act was reasonable.
If Mr Dudic is subject to an eight-week non-payment period in respect of his NSA, the Tribunal must also determine whether the Secretary has discretion to end that period. This depends on:
(i)whether serving the non-payment period would cause Mr Dudic “severe financial hardship”; and
(ii)whether he is in a class of persons specified by legislation pursuant to s 42S(5) of the Administration Act.
APPLICANT’S EVIDENCE
Mr Dudic said he was recruited as a confined spaces labourer for which he has the necessary ticket. However, when he attended the plant at Tallawarra True Energy did not have any confined space work for him to do and instead asked him to work as a cleaner and water boy. Mr Dudic admitted that he wrote “sux” on his hard hat. He said this was a stupid thing to do and regrets doing this. However, he denies reading private and confidential information on a worker’s desk in True Energy’s Administration office. He said he went into the office to see if they wanted milk and as he was waiting at the reception counter, he leant over the counter to read some brochures there. He did not read any private of confidential documents.
Mr Dudic also denied ever having been affected by alcohol or hung over at work. He knows better than to turn up for work so affected having worked on many jobs where he has been breath tested. At the Tallawarra plant, he was also breath tested by security guards at the entry gate on most days and would not have been allowed access if he had been affected by alcohol.
Mr Dudic said on the afternoon of Thursday 29 September 2011, he was spoken to by Mr Berkeley who, in addition to telling him he should not have written the word “sux” on his hard hat, accused him of reading private and confidential information in the Administration office. Mr Berkeley told Mr Dudic to lift his game, said “you’ve been warned”, and walked off. This probably lasted about five minutes. Mr Dudic said that after being spoken to like this, he did not feel like returning to work. He felt victimised, and that Mr Berkeley would watch him and pick on him. As a result, he decided not to return to work on Friday 30 September 2011.
Mr Dudic said he realises now that he should have gone to see Drake or Mission Australia the next day to tell them what had happened. Instead, he left it to the following Tuesday morning, the Monday being a public holiday. On the Tuesday morning, he went to Mission Australia’s office at 9.30 am to speak to Ms Rushworth. She was busy at the time and asked him to come back an hour, which he did.
Mr Dudic said he has never been dismissed from any employment and has never been in trouble like this before. He worked for BHP doing shift work for about five years until they outsourced the work he was doing to a labour hire firm. He has also worked on and off on the railways for about 14 years, working with labour hire companies like Drake. He had an interview for a job about three weeks ago and hopes to start work on 16 July 2012. If he gets this job, he may have work until 2014.
Mr Dudic lives with his mother in a house she owns and pays her rent of $200 per fortnight and contributes a share of the utilities bills when he can. He has a driver’s licence but does not own a car. He has substantial debts: he owes MasterCard about $4,500, the State Debt Recovery Office about $7,600 (which he has reduced from $13,500 and which he continues to repay in order to keep his driver’s licence), and a few personal debts to family members.
Mr Dudic said his mother’s health is not good – she had surgery to remove a kidney in late 2010, but she is mobile and there is nothing special he needs to do for her. Mr Dudic’s health is reasonable but he needs some teeth removed.
RESPONDENT’S SUBMISSIONS
Mr Slattery, for the Department, said the Department contends that Mr Dudic was not dismissed but chose to leave his employment voluntarily without reasonable cause. Mr Slattery said it is normal for there to be some friction in most workplaces and Mr Dudic should have given his employment with Drake a chance. He acknowledged that Drake’s contract with True Energy was short term only and ended the following week. However, this was nothing to do with Mr Dudic’s placement and is not relevant for present purposes.
Mr Slattery submitted that the test to be applied in determining whether Mr Dudic’s conduct was reasonable is an objective one. While Mr Dudic disputes having read private and confidential material, he acknowledges that he was stupid to write “sux” on the hard hat. In such circumstances, the Manager was entitled to speak to Mr Dudic about his conduct and there is no evidence that Mr Dudic was harassed or treated unfairly.
Mr Slattery submitted that Mr Dudic does not fall within the classes of persons listed in the 2009 Legislative Instrument and the severe financial hardship discretion does not therefore apply. Mr Dudic hopes to start work in about two weeks time, which may last until 2014. If so, any financial hardship to Mr Dudic as a result of the application of the non-payment period may be brief.
DISCUSSION
Mr Dudic acknowledges that his conduct in writing “sux” on his hard hat was stupid and he should not have done this. However, he disputes that he read any private or confidential material in True Energy’s Administration office, contending that he only read some brochures on the reception desk while he was waiting. He also denies ever been affected by alcohol while at work. There being no probative evidence to establish that Mr Dudic read any confidential material or was ever under the influence of alcohol at work, I accept Mr Dudic’s explanation for what occurred.
Mr Dudic told me he believed that if he turned up for work on 30 September 2011, after the warning he received from Mr Berkeley on the previous afternoon, he would be picked on. I accept that he may have found Mr Berkeley’s warning confronting, but in the light of his admitted misconduct in writing “sux” on his hard hat, in my view it was not unreasonable for Mr Berkeley to have warned him about such conduct. Mr Dudic said that he feared that if he turned up for work next day he would be watched “like a hawk” and picked on. However, when I asked Mr Dudic if he thought it reasonable for a manager who had identified misconduct by a worker to keep an eye on him in the immediate period, he acknowledged that it was.
I am not satisfied that Mr Dudic’s conduct in voluntarily terminating his employment by not attending work on the day after receiving a warning was reasonable. Viewed objectively, it was not unreasonable for a manager to reprimand Mr Dudic for writing “sux” on his hard hat and, while the manager may have unjustly accused Mr Dudic of reading private and confidential material, I am not satisfied that this in itself was sufficient to justify Mr Dudic in treating his employment as effectively at an end. Thus, the decision to impose a non-payment period of eight weeks in respect of the payment of NSA to Mr Dudic was in accordance with s 42S of the Administration Act.
Mr Dudic’s evidence indicates that he does not fall into the specified classes of persons set out in clause of the 2009 Legislative Instrument referred to above. He does not have significant family and caring responsibilities (subclause (1)(a)), does not have an illness, impairment or condition that brings him within subclause (1)(b), does not have an impairment or mental illness that brings him within subclause (1)(c), and has safe, secure and adequate housing by reason of his living with his mother so that he does not fall within subclause (1)(d). Thus, there is no discretion in s 42S(4) to end the non-payment payment period. Certainly, Mr Dudic’s financial position is strained and he owes substantial debts. However, this by itself does not enliven the exercise of the discretion in s 42S(4) if he does not fall within one of the classes of persons set out in the 2009 Legislative Instrument.
In conclusion, the decision under review to impose an eight-week non-payment period on Mr Dudic must be affirmed. While the significant financial difficulties this is likely to cause him should be acknowledged, I note, nevertheless, that he hopes to secure suitable employment in about two weeks time.
DECISION
The decision under review is affirmed.
I certify that the preceding 28 (twenty three) paragraphs are a true copy of the reasons for the decision herein of Deputy President R P Handley.
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Associate
Dated 6 July 2012
Date of hearing 29 June 2012 Date final submissions received 29 June 2012 Applicant In person Advocate for the Respondent B Slattery
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