C2001/3503, Transcript of Proceedings [2002] AIRCTrans 1225 (10 April 2002)

AUSCRIPT PTY LTD
ABN 76 082 664 220

Level 4, 60-70 Elizabeth St SYDNEY NSW 2000
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TRANSCRIPT OF PROCEEDINGS

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

JUSTICE GIUDICE, PRESIDENT
SENIOR DEPUTY PRESIDENT MARSH
COMMISSIONER REDMOND

C2002/1394
C2001/3503

APPEAL UNDER SECTION 45 OF THE ACT
BY COAL AND ALLIED OPERATIONS PTY
LIMITED AND MT THORLEY OPERATIONS
PTY LIMITED AGAINST A DECISION
(PR909053 AND PR914896) AND ORDERS
(PR914897 - 914901) OF DEPUTY PRESIDENT
LEARY AT HOBART ON 17 SEPTEMBER 2001
AND 4 MARCH 2002 IN U NUMBERS 21157,
21173, 21174, 21181 AND 21182 OF 1999
RE TERMINATION OF EMPLOYMENT

APPEAL UNDER SECTION 45 OF THE ACT
BY COAL AND ALLIED OPERATIONS PTY
LIMITED AGAINST A DECISION MADE BY
DEPUTY PRESIDENT LEARY AT HOBART ON
17 SEPTEMBER 2001 IN U NUMBERS 21108
OF 1999 TO 21189 OF 1999 (PR909053)
RE TERMINATION OF EMPLOYMENT

SYDNEY

10.14 AM, TUESDAY, 26 MARCH 2002

Continued from 8.3.02 in Melbourne

PN501

JUSTICE GIUDICE: I will take the appearances again.

PN502

MR R. BUCHANAN: I seek leave to appear for the appellants with my learned friend, MR CROSS.

PN503

MR S. CRAWSHAW: I seek leave to appear with my learned friend, MR DOCKING, for the respondents.

PN504

JUSTICE GIUDICE: Mr Crawshaw, these two matters have been called on together based I think on some submissions made on this, the mention of these matters or at least of the original appeal a week or so ago. Is there any agreement about how they should be dealt with?

PN505

MR BUCHANAN: I must say we haven't spoken about it but I think it would be sufficient to deal with the second appeal, your Honour, on the basis that the submissions on the first appeal so far as relevant are incorporated in the material on the second.

PN506

JUSTICE GIUDICE: Yes, your view about that, Mr Crawshaw?

PN507

MR CRAWSHAW: My learned friend's clients appeals, if he is only prosecuting the second appeal, he should ask you to do something with the first appeal, either hear it or have it dismissed. It can't be just left hanging there.

PN508

MR BUCHANAN: It could be stood over, your Honour, I can't think of a reason why the second appeal wouldn't provide a full and adequate vehicle of dealing with all the issues but my experience of life to date has taught me never to take things completely for granted. If that - - -

PN509

JUSTICE GIUDICE: Anything in particular, Mr Buchanan?

PN510

MR BUCHANAN: No, your Honour, just the usual respect for canny opponents.

PN511

JUSTICE GIUDICE: Well, in the circumstances I think we will simply permit you to make your submissions in the manner you intend to and if it becomes necessary to deal with the issue of how the first appeal is to be disposed of, then we will in due course.

PN512

MR BUCHANAN: Yes. It is not going to change anything that I will say on the appeals. It won't be necessary to deal with some jurisdictional issues that are addressed in the initial submissions.

PN513

JUSTICE GIUDICE: Yes, but we will need to have regard to the submissions filed in the first appeal?

PN514

MR BUCHANAN: Yes, and we incorporated them by reference as it were in the submissions we filed in the second appeal.

PN515

JUSTICE GIUDICE: Yes, are there any other preliminary issues?

PN516

MR BUCHANAN: There's just a couple of short matters. Your Honour, we have provided two folders of cases. They are the cases that are referred to in the written submission. There will be a handful of others that I will hand up in the course of the submissions. The other thing was, your Honour, that there were no formal directions for written replies but when we read out appellant submissions, we quickly came to the view that there were very many areas in them where we did not accept either the factual accuracy of the submissions nor the statement of principles to be derived from the cases that are referred to.

PN517

We prepared a written reply because we thought that was the most efficient way to deal with what turned out to be quite a number of areas in which we took issue with them. May I hand it up as it goes into such a level of detail that it would be most inefficient for me to try and deal with these issues orally?

PN518

JUSTICE GIUDICE: Yes, thank you, Mr Buchanan.

PN519

MR BUCHANAN: It has probably struck the bench already that there is a significant difference in the way the parties were approaching this appeal. We think we are approaching it on rather broader lines than the respondents. They appear to us to be wishing to deal with a myriad of factual circumstances, most of them which we regard as frankly irrelevant for reasons that we will come to but we've said in paragraph 2 of this reply on the basis that we are attempting to give some balance in the factual area. It would be necessary if one had to go to the facts and detail to go to the sorts of material rather than being content with a summary given by one of the parties.

PN520

MR CRAWSHAW: Can I just say, I can understand the logic of putting things in writing that it creates the difficulty for us in dealing with this material that we have got sit in Court today absorbed what my friend says orally, deal with that and then at some time out of Court also try to come to grips with this.

PN521

JUSTICE GIUDICE: Well, we have got some sympathy for that.

PN522

MR CRAWSHAW: We haven't looked at it yet but it may require for us to do something in writing after the hearing has finished or something of that nature.

PN523

JUSTICE GIUDICE: Yes, by all means.

PN524

MR CRAWSHAW: The other thing, while we are talking about preliminary matters, the thought occurs to me that the stay in this matter was listed before her Honour, Senior Deputy President Marsh, last week. It was rather unusual I think given that the appeal was coming on this week.

PN525

JUSTICE GIUDICE: Yes.

PN526

MR CRAWSHAW: It is again listed before her Honour today, the orders having been stayed until this afternoon. We would have thought given that the Full Bench is actually hearing the matter that it would be a convenient course for the Full Bench to deal with any stay having regard to the written submissions that have already been put in which really more than normal deal with the question or arguable case. So it would be a matter of what the Full Bench was minded to deal with it rather than have her Honour deal with it, it would be a matter of whether on the written material at this stage the arguable case test is satisfied and secondly what flows from that.

PN527

We say our position will be that the same thing should happen as in the Hunter Valley case which your Honour, the President, will recall had a torturous series of hearings in relation to the stay which partially due to the fact that a single member dealt with the matter and then it was then appealed and your Honour sat on the appeal bench and we don't want to see anything like that happening in this case when the appeal is already being heard this week in any event.

PN528

JUSTICE GIUDICE: I think you should reinforce Senior Deputy Marsh.

PN529

MR CRAWSHAW: Well, it just seems an unusual course for the matter to before her Honour as a single member when the appeal is already on. I can understand the logic of doing that when the appeal is weeks or months off.

PN530

JUSTICE GIUDICE: No. Yes, Mr Buchanan?

PN531

MR BUCHANAN: Just on the question of stay, your Honour, I don't want to get drawn too far into this at the moment, but one of the reasons why the stay had to be dealt with was the time limit imposed by Deputy President Leary on satisfaction of the orders. On one view of it, the best thing to do might be - although perhaps we should address this to your Honour this afternoon - might be to extend the interim stay until the end of the appeal, and then the full gamut of the arguments can be appreciated.

PN532

JUSTICE GIUDICE: I can't say much on that because I wasn't on the - involved in the stay hearing earlier in the week.

PN533

SENIOR DEPUTY PRESIDENT MARSH: Can I just say that when the matter was brought on last Thursday that proposition was, in fact, put by the appellant, and there was no support whatsoever from the union with respect to that proposition, that there be an interim stay issued for 10 days to allow the matter to be heard by the Bench this week, and then allowing the parties to rely on those submissions, and the Commission to rely on those submissions before deciding the stay order.

PN534

MR BUCHANAN: Yes, it would have been much easier if there had been consent. Perhaps, it will occur to somebody that the difference between this afternoon and Thursday afternoon is not of earth-shattering importance. Let us hope so, but could I mention one thing in connection with the folder of cases. It has been brought to my attention that, in fact, volume 2 commences earlier than the index would suggest. I hope that does not cause any inconvenience but if a case is not actually found in volume 1, commencing from Cosco Holdings, it will be found in volume 2.

PN535

The circumstances of the present appeal, and the case that was before Deputy President Leary, while not unique and not even, perhaps, unusual, they are important for the reason that the case involved, a consideration of large numbers of redundancies, and it will be apparent from our written submissions that we contend this puts the case, and cases of this kind, into quite a different circumstance than cases of individual dismissals for cause. That is a fact that permeates, in one sense, the whole of the appeal and the way in which the statute is to be construed, the way in which various factors, if they are operative, are to be given weight.

PN536

In our written submissions, we - I can refer to them briefly, and I should tell the Commission that I propose to assume, unless rapidly disabused, I propose to assume that the submissions have been read and that it would be both unnecessary and inconvenient to go through them in detail. At paragraph 49 of the submission, when we are dealing with some questions of construction, we suggest that the provisions of section 170CG(3)(a) pose two questions. Sometimes we have noted in the cases it is suggested that, in fact, it poses three questions but we think the better approach is to regard it as posing two questions, one of which concentrates on the operational requirements of the employer, the other of which concentrates on the conduct or capacity of the individual employees.

PN537

You see it in paragraph 50, that they were two alternatives and did not overlap, although we would later give attention to the possibility of concurrent application of both questions. We mentioned in paragraph 53 that we accepted that there were cases in the Commission that had taken a different view. Until very recently, there didn't appear to be a case in the Commission that squarely addressed this issue.

PN538

JUSTICE GIUDICE: Mr Buchanan?

PN539

MR BUCHANAN: Yes?

PN540

JUSTICE GIUDICE: I'm having great difficulty locating your submissions.

PN541

SENIOR DEPUTY PRESIDENT MARSH: I think I am too.

PN542

MR BUCHANAN: Your Honour, there were - they ended up at the front of one of two folders. There are two folders because there were a number of appendices attached.

PN543

JUSTICE GIUDICE: Yes. I've read them but I just don't know where they are. Somewhere between Melbourne and here - - -

PN544

MR BUCHANAN: I see.

PN545

JUSTICE GIUDICE: - - - they've transmogrified. What is the heading on them?

PN546

SENIOR DEPUTY PRESIDENT MARSH: Yes, the file has appendices but, in fact, the submissions are contained in them.

PN547

MR BUCHANAN: Yes, it does, and the appendices take up the bulk of the folders. What is the heading? The spine has "Appendices Volume 1" and "Appendices Volume 2", but at the front of volume 1, there should be a written submission.

PN548

JUSTICE GIUDICE: Thank you.

PN549

SENIOR DEPUTY PRESIDENT MARSH: That is fine.

PN550

MR BUCHANAN: I'm sorry about that, your Honour.

PN551

JUSTICE GIUDICE: That is all right. There are a number of documents with "submission" written on them.

PN552

MR BUCHANAN: I see.

PN553

JUSTICE GIUDICE: A very large number.

PN554

MR BUCHANAN: It might be worth taking a large red pen and marking them with an asterisk or a diamond or something.

PN555

JUSTICE GIUDICE: Thank you.

PN556

MR BUCHANAN: Your Honour, I've mentioned the argument that we put, commencing at paragraph 49, to the effect that there are two alternatives in section 170CG(3)(a) and that they don't overlap. The reason I've mentioned it is because there's a very recent Full Bench decision that deals directly with this proposition and it is against the argument. We did go on in the submissions to deal with the alternative construction, namely, that there may be some degree of overlap at least, and we've mentioned a number of times the Full Bench decision in Windsor Smith where your Honour, as President, presided.

PN557

The recent decision, and I will hand up a copy, is a decision of the Full Bench delivered less than a week ago on 21 March in Bay, Smith and Others v Moore Paragon Australia Limited, print 915674. The case turns on some critical findings which I might identify for the Commission at the outset, some critical factual findings. Firstly, in paragraph - I should just say by way of background that there were a number of persons compulsorily retrenched and there was an allegation, rejected at first instance, that the selections had been affected by the fact that many people were absent from work on injury or something of that kind.

PN558

On appeal, that contention was accepted and at paragraph 66, the Full Bench said, this is at page 23:

PN559

It was satisfied that on a full reading of the evidence in its entirety, it was reasonable to infer that the respondent did have regard to the WorkCover and injury status of the appellants, and that it played an operative part in selecting them for retrenchment.

PN560

That finding, after further discussion, is reflected in paragraph 91 where the Commission said:

PN561

In the circumstances of this case where the appellants were selected to be made redundant on the basis of their WorkCover history of injury status, we were not satisfied that their employment was terminated for a reason that was sound, defensible or well-founded. In our view, there was no valid reason for the termination of the appellants' employment within the meaning of section of 170CG(3)(a).

PN562

On the way to that final conclusion, there is a discussion which occurs from about paragraph 70, about the operation of section 170CG(3)(a). There are references to two Full Bench decisions, both of which we've mentioned in our written submissions. The first one is Windsor Smith v Liu and Others, print Q3462, and the second was Lockwood Security Products Proprietary Limited v Sulocki, print 908053. Starting from those cases, and having distilled the principles for which they are said to stand, there was consideration of an argument that the Commission will see set out in paragraph 81.

PN563

It is argued that section 170CG(3)(a) provides two distinct mutually-exclusive options, and that argument was rejected for the four reasons that were set out in the paragraphs that followed which, with the greatest of respect to those that constituted the Full Bench, we do not accept for the purposes of the present appeal. I want to make it clear that we maintain the primary position that we argued in the written submissions although, of course, the case does not ultimately turn on that because we have addressed, with fairly full measure, the other possibilities.

PN564

We mention the Sulocki case in paragraph 94 of our written submission, and we point out that the decision in that case apparently relied - that is the decision by the employer, apparently, relied upon unsatisfactory aspects of capacity or performance of certain employees. Now, I don't want to spend too much time on this beyond bringing the Commission's attention to the fact that this decision exists and is against one of the things that we've argued. One feature of it is that although Senior Deputy President Lacy was on the Full Bench, there's no mention of a decision that we refer to in our written submissions at paragraph 59, Colm v Clariant Australia Proprietary Limited.

PN565

That was a case where Senior Deputy President Lacy found, as had Commissioner Hingley, at first instance, in the Moore Paragon case, that the selection of employees for retrenchment had not been for reasons related to capacity or conduct, and that section 170CG(3)(c), accordingly, had no room to operate. There's also no mention of something that we referred to - I'm sorry, I said 59, I should have - it is mentioned in 59 but the particular paragraph, in that respect, was at paragraph 69. There's also no mention of something that we went about, with respect to the decision in Kenefick, at paragraph 68, which is that although in Kenefick, under the earlier statutory scheme there is discussion of the importance of selection of individual employees, both of the reasons in Kenefick in relation to the provision that is the most similar to 170CG(3)(a), was said to be based upon the operational requirements of the employer. Now, we - - -

PN566

JUSTICE GIUDICE: Mr Buchanan, there's a matter that has been bobbing around in my memory that I've not mentioned to you and to Mr Crawshaw, there was a case, I think, in the Federal Court about 10 years ago involving redundancies in the mining industry in Western Australia where there was a process of evaluation of performance prior to termination, selection for termination. I can't find the case nor can I remember the name of it but if anybody else does, I would be very grateful.

PN567

MR BUCHANAN: It does not ring any bells.

PN568

JUSTICE GIUDICE: Yes, with the work that has been done in this case, I assumed somebody else would have come across it but it did seem to have some factual parallels. That is why it rang a bell with me. I've made some effort to find it myself but without success.

PN569

MR BUCHANAN: We will have some further searches made, your Honour. It is certainly not something that we came across - - -

PN570

JUSTICE GIUDICE: No.

PN571

MR BUCHANAN: - - - in the course of preparation. If we are wrong about the primary contention, perhaps even if the Full Bench decides it is unnecessary to deal with it again, that will nevertheless leave the position squarely in the territory marked out by the decision in Windsor Smith, namely, whether there is a second reason for the termination of employees in redundancy cases is simply a question of fact in each case. If it cannot be said that the two things are, as a matter of statutory construction, mutually exclusive, neither can it be said that they are necessarily present in cases of redundancy where aspects of relative merit are taken into account.

PN572

The next thing I want to mention arises also from the Moore Paragon decision. It is at paragraph 92. It bears directly on the next issue that we want to deal with in the oral submissions. Now, this appears, of course, to be completely consistent with the other authorities to which we have referred in our submissions. The Full Bench says:

PN573

As we have already noted, in determining whether or not a termination of employment is harsh, unjust or unreasonable, the Commission must consider ...(reads)... related to the capacity or conduct of the employee. In the context of section 170CG(3), these references are clearly to the valid reason referred to in section 170CG(3)(a).

PN574

Now, with that in mind, which reflects something that we put in the written submissions, could I draw attention to some features arising from what I will describe as the first decision, the decision of 17 September 2001.

PN575

JUSTICE GIUDICE: Mr Buchanan, forgive me for interrupting the flow of your submissions, but we have read these submissions so, obviously, we are familiar with a lot of the matters you are putting.

PN576

MR BUCHANAN: Yes.

PN577

JUSTICE GIUDICE: But does it follow from your case that, at least on one alternative construction of the CG(3), that this proceeding found it from the start because it only involved 5 of the 80 or so?

PN578

MR BUCHANAN: Yes, it does, your Honour. Certainly, when one - it may not have founded on the question of whether the determination of the harsh and unjust are unreasonable. I would certainly encounter considerable difficulties. Certainly, on our submission, it could not have proceeded to the next stage.

PN579

JUSTICE GIUDICE: But - - -

PN580

MR BUCHANAN: I'm tempted to say, yes, but it really requires a bit more detailed explanation.

PN581

JUSTICE GIUDICE: Yes, I understand that and we have read the submissions, but it seemed to me that your case involved the proposition that if there were some issue about selection - - -

PN582

MR BUCHANAN: Yes.

PN583

JUSTICE GIUDICE: - - - for retention in each - in the case of each individual, that necessarily involves some sort of comparative exercise.

PN584

MR BUCHANAN: Yes, it does.

PN585

JUSTICE GIUDICE: That you couldn't take 5 in isolation.

PN586

MR BUCHANAN: No, that is right. They were said to be - the premise was that they were representative, but a first reading of the decision will show that that certainly was not the way in which the conclusion was reached. They appear to have been evaluated for reasons which were highly particular to each of them, but then you get - just jumping ahead a bit, your Honour, you run into these sorts of problems. There was not the slightest indication that the way in which they were evaluated, for example, was inconsistent or weighted - was inconsistent with the way in which weightings were assigned to other people in the workforce, so there's no basis for thinking, whether by reference to other people who were retrenched, or by reference to people who were retained, that they were treated differently so that there would have been any change in the ultimate result.

PN587

Nor is there any reason to think that whatever might have been said about the particular circumstances, assuming they were relevant, and your Honour understands me arguing that, in large part, they were not.

PN588

JUSTICE GIUDICE: Yes, this is an alternative, yes.

PN589

MR BUCHANAN: Assuming for the moment they were relevant, there's no basis for thinking that it would have altered the selections that were made of those who were to be retained in the workforce. In that sense, the case just never got there. That, in large measure, is because the applicants below chose to run their cases on a particular footing, namely, to take issue, chapter and verse, with a series of assessments of their work which were earlier in time than the actual selections, and then to argue, as it were, that that so infected the process that the outcome was unfair.

PN590

All of that, as the Commission will see from our submissions, falls well short of making out a case under the relevant sections. Particularly is that so insofar as the decision turned upon the application of section 170CG(3)(c) as it appeared to do, virtually in its entirety, because that section is not directed to outcomes. It is directed to opportunities. No doubt, there could be a case where a supposed opportunity was so illusory that you would say comfortably that it wasn't a real opportunity, but that wasn't the case here.

PN591

JUSTICE GIUDICE: Yes. Anyway, I think I've probably distracted you from your submissions. I was really interested in the matter that I asked you about. Anyway, there's a long way to go.

PN592

MR BUCHANAN: Well, we have. I'm afraid we are going to go down through all the descending - - -

PN593

JUSTICE GIUDICE: Yes.

PN594

MR BUCHANAN: - - - levels but it is a feature of the case that this preliminary selection saw the case go forward on what proved to be, on Deputy President Leary's reasoning, a completely false premise, namely, that defined who was selected by the CFMEU, three of whom were tradesmen in a relatively-speaking smaller group than the other two. In any event, that they could be fairly regarded as representative more than anything concluded with respect to their circumstances would vary in some useful way upon the position of the others. After that point, the case descended into minute detail about their personal circumstances and was, ultimately, decided by reference to those sorts of factors.

PN595

JUSTICE GIUDICE: What is your clients position or expectation in relation to the other 77.

PN596

MR BUCHANAN: The applications are pending, your Honour, and I think the position is - I can get instructions on that insofar as anybody is aware, it is intended that they should proceed.

PN597

JUSTICE GIUDICE: Yes, in due course.

PN598

MR BUCHANAN: In due course. One of the complaints we've got about this case is that one faces the really appalling prospect that this will go on and on for months and years with the levels of back pay increasing, ultimately to face a circumstance where some unknown number of persons, for all we know - and with the approach so far taken it might be all of them - are back in competition with all the existing employees, not having worked for this employer for years, all of whom haven't received, of course, the severance pay, the retrenchment pay contained in the certified agreement and maintained in operation when the certified agreement was set aside by the Commissioner.

PN599

So there's a full measure of compensation on any ordinary principle relating to redundancy well above the Commission's normal arbitrative standards, and all of that has gone, as it were, for nothing.

PN600

JUSTICE GIUDICE: Yes, which reminds me, in due course could somebody tell me where we can find the amounts of redundancy or severance payments that particular employees received.

PN601

MR BUCHANAN: I will have to get that. We will get some references taken out about that.

PN602

JUSTICE GIUDICE: The applicants in this case, the five applicants.

PN603

MR BUCHANAN: The five applicants.

PN604

JUSTICE GIUDICE: Yes.

PN605

MR BUCHANAN: We will get some references taken out of that, your Honour. I was going to go to her Honour's decision where under the heading "Findings", paragraph 114, and following, she appears to accept that the reasons for termination were the reduction of the workforce due to operational requirements and the retention on merit, in the perception of the employer, of those employees who remained with the business. In paragraph 114, she says:

PN606

The evidence of MTO is that there was a need to reduce employee numbers due to a downturn in the coal industry. Accordingly, a program of retrenchment was introduced based on a system of merit-based performance assessment. MTO submitted that the proper test the Commission should apply to satisfy the requirements of section 170CG(3)(a) is whether there was a valid reason for the terminations, and that the valid reason was due to operational requirements. I agree with that submission and find accordingly.

PN607

Then she goes on to deal with notification of the reason, paragraph 117. She says:

PN608

I am satisfied the employees were advised at a number of presentations that were done this was due to the operational requirements of MTO would ...(reads)... have been understood by all employees as being to reduce employee numbers. It was the process or selection about which they complain.

PN609

Now, can I emphasis that distinction at once. The distinction between the reason on the one hand, and the process and selection on the other hand because on this analysis, on this approach, it seems clear that Deputy President Leary herself did not regard these as being reasons in the section 170CG(3)(a) sense. Down at paragraph 120, she says:

PN610

I deal with the requirements of section 170CG(3)(c) and (d) together...

PN611

as though they were independently imposed requirements, like the old section 170DC regime where a failure to accord some sort of procedural fairness would independently make a termination unlawful and attract a remedy under the earlier provisions of the Act. Now, in the written submissions, we've argued that on the facts of the present case, sections 170CG(3)(c) and (d) were irrelevant for various reasons. The written argument is fairly detailed and I don't propose to repeat it again, but one reason that we assign to that that I want to draw attention to again is that no finding was made that the issues dealt with under those provisions were, in fact, in point of fact, operative reasons to be examined for validity.

PN612

We point that out, particular at paragraphs 57 and 58 of the written submission. In response to that, our opponents make the submissions - I think this is the only time I will need to refer to their submissions - make the submissions to be found at paragraphs 247 and 248, and 257 and 258 of their submissions. Say, for example, in 248 - this is at page 88:

PN613

The primary submission of the employees is that it can be clearly inferred from the paragraphs of the decision set out ...(reads)... considerations in section 170CG(3)(a).

PN614

At 258 they say - at 257 they say:

PN615

The employees were terminated by the employer for two kinds of reasons.

PN616

Then a fair reading of the whole of the decision shows that her Honour determined that the employees were terminated by the employer for two kinds of reasons. Now, the problem with that line of argument is that Deputy President Leary didn't say anything like that in the decision. She never identifies, as an operative reason for termination, matters relating to capacity or conduct. She was concerned with issues of process. If conduct or capacity had been a reason, it would need to be examined for validity, but it wasn't. It was issues of process that were at the heart of her analysis.

PN617

JUSTICE GIUDICE: You say she adopted the right approach in relation to CG(3)(a).

PN618

MR BUCHANAN: Yes, we do, your Honour, but the wrong approach in relation to (c) and (d). There are a number of places in the decision where the emphasis on process appears. May we pick them out. Paragraph 112 - the applicants relied on a number of allegations about the unfairness of the process. Then she refers to allegations about performance issues. I have referred already to paragraph 117, process and selection, about which they complained. Paragraph 127:

PN619

The evidence of the applicant, however, does not support the MTO submissions as to how the process was undertaken. The applicants complained that they were not given the information sought and the process was not applied in accordance with MTOs own guidelines.

PN620

129, in the last sentence which appears on page 27:

PN621

In these applications, however, the claim is that the process has not been applied fairly or objectively.

PN622

She goes on immediately to make a distinction between the system utilised, which she says was not a matter for her, and the application of the system which is the area in which she seems to find some fault. Now, just by way of illustration because it helps to demonstrate the approach that Deputy President Leary was taking to be the way in which the Act operating. Then we draw attention to the fact that she adopted the same approach in the Hunter Valley number 1 case, which is under appeal independently. But there is a consistency which is useful to point out. It is a very long decision. I am only going to refer to one page of it, I think.

PN623

JUSTICE GIUDICE: Perhaps if you just read it out.

PN624

MR BUCHANAN: Could I read it out, your Honour, and then just hand up the copies?

PN625

JUSTICE GIUDICE: Yes.

PN626

MR BUCHANAN: The paragraphs I'm going to read are paragraphs 237 to 240.

PN627

JUSTICE GIUDICE: I think we might have those incorporated in the transcript.

PN628

MR BUCHANAN: Thank you, your Honour. Where her Honour says:

PN629

I deal with the requirements of section 170CG(3)(c) and (d) together. The terminations were due to redundancy and not for reasons of unsatisfactory work performance. However, the company implemented a system of performance assessment to select employees for attention/redundancy which did require an assessment of work performance. For the purpose of considering the requirements of the Act it is the application and implementation of that performance assessment system which is addressed.

PN630

238:

PN631

I have discussed earlier in this decision the 1997 WPR and the 1998 PA, being the systems of merit assessment used by company. I now look at those processes and their compliance with the requirements of the Act.

PN632

239:

PN633

The Act requires that if an employee is terminated due to his/her capacity or conduct, that he/she be provided an opportunity to defend that capacity or conduct (section 170CG(3)(c)) and if the termination relates to unsatisfactory performance, whether the employee had been given any warning about that alleged unsatisfactory performance prior to the termination.

PN634

240:

PN635

To deal with those requirements of the Act it is necessary to look at the process implemented for the purpose of selecting employees for redundancy and whether such process was a fair process and the manner in which that process was implemented for the assessment of the employees.

PN636

Now, the result in that case is under appeal elsewhere, but the approach to the Act seems tolerably clear and, with respect, it is not one which accords with the statutory scheme. One has to go beyond notions of process and assign reasons. One then has to examine the reasons for validity and notification and if, but only if, the operative reasons relate to capacity or conduct they have to be examined for opportunity. Not for outcome but for opportunity.

PN637

It seems that Deputy President Leary thought that she was obliged to look at questions of the application of section 170CG(3)(c), even in areas not regarded by her as constituting reasons for dismissal. In that, in our respectful submission, she was clearly wrong. If that is right, as we submit it is, then even on her own analysis, applying the statute correctly, section 170CG(3)(c) and (d) were irrelevant. To the extent that the case depends upon their application, as it does virtually in its entirety, the case is miscarried and the decision must be put aside.

PN638

JUSTICE GIUDICE: Mr Buchanan, it seems to me that to some extent submissions of both of the parties, all of the parties, take a view of the operation of section 170CG(3) which is similarly rigid and might lead to practical difficulties. It involves an analysis of the operation of the paragraphs which really, I would have thought, could lead to some very practical problems in these cases being resolved.

PN639

MR BUCHANAN: Your Honour, I accept that without hesitation.

PN640

JUSTICE GIUDICE: We get thousands of them a year and they have to be dealt with in a practical way.

PN641

MR BUCHANAN: The problem we face is that this is the way that the decision was reasoned. Your Honour, may I make it clear: we accept without reservation the observations in Windsor Smith to the effect that there is, at the end of the day, only one question for resolution. I think what was called the primary or the central issue: was the termination harsh, unjust or unreasonable. Now, all of these other things are matters to which of course regard is directed but none of them, individually or perhaps even in the extreme case collectively, without more could determine the outcome and without attention being given to the one question for resolution.

PN642

I am going to take the Commission, I regret, in some little detail to the series of cases in Burn v Australian Airlines, which have their origins I think earlier than the distraction which is now represented by the earlier statutory scheme, to show that that is at the heart of the common law position also.

PN643

JUSTICE GIUDICE: Yes, but I wanted to just draw you back to the question I'm asking. Isn't it possible that issues that are taken into account - factual issues, circumstances of the dismissal - under one paragraph, if they equally could have been taken into account under another paragraph, at the end of the day does it matter greatly?

PN644

MR BUCHANAN: Well, it does matter. We have accepted in the written submission that these sorts of factors may have been examinable under paragraph (e) if one needed to find a particular provision. But the fact that they weren't matters to which specific attention was directed by the statute, whilst not making them irrelevant might mean that the weight to be assigned to them was rather less.

PN645

If for example one were examining questions of process not in relation to the validity of a reason, not in relation to unnecessary opportunity to make a legitimate representation but as some part of the background, then it is a fairly short step to say that in most cases those sorts of issues whilst not irrelevant may not be terribly important at the end of the day. They may be but in most cases they won't be. What is important at the end of the day is whether the termination was justified or not, not whether there was some procedural slip, but whether it has been shown that in effect it shouldn't have happened at all.

PN646

JUSTICE GIUDICE: Yes.

PN647

MR BUCHANAN: Now, I don't mean to give undue emphasis to the fact that the Commission has recognised that the present statutory scheme is very different to the earlier one and it does not operate upon notions of unlawfulness which are constituted by procedural neglect. It goes, as it were, rather more directly to the heart of the matter even though there are some statutory directions to be complied with on the way. But these are not conditions, these are not requirements as her Honour seems to think they are.

PN648

JUSTICE GIUDICE: Yes, that is the point you make about the two paragraphs you are dealing with at the moment, yes.

PN649

MR BUCHANAN: Yes, but we haven't said, your Honour, that you couldn't take them into account under (e). The problem here is that that is not the way that Deputy President Leary approaches it. She says there has in fact been a breach of paragraph (c) and as a result she finds the dismissals were harsh, unjust and unreasonable. As a result in the second decision there must be a remedy and that remedy is reinstatement. One moves very quickly from a failure to apply the statutory scheme or appreciate its proper significance to a formal order for reinstatement - in factual and practical circumstances where such an outcome raises questions which are almost alarming for practical operation of these provisions. The Commission knows this is not the only case where such problems are arising; where a small number of people are the beneficiaries of formal orders for reinstatement following conclusions of failure and process for the large number of people waiting in the wings.

PN650

Before I go a bit more deeply into the factual issues, can I mention some other issues of principle. The first thing we want to come back to that we dealt with in the written submissions is this:

PN651

A conclusion that a termination is harsh, unjust or unreasonable is not discretionary.

PN652

It is either right or wrong. It is not a discretionary decision as that term is usually understood. I'm not going to go back into the argument about Coal and Allied and Miller and those sorts of things, but I do want to draw the Commission's attention to the judgment of the High Court in House v King from which usually stems the proposition that discretionary decisions are dealt with by looking at the process by which the decision is arrived at rather than the correctness of the decision itself. It is in our folders of volume 2. I'm afraid there aren't any tabs but I'm told it is the seventh case in volume 2. The reference is 55 Commonwealth Law Reports page 499.

PN653

JUSTICE GIUDICE: They were the days when librarians noted up the volumes for you.

PN654

MR BUCHANAN: It is not taken from one of mine unfortunately, your Honour. I wanted to start at page 504 at the beginning of the majority judgment because it is important, with respect - sometimes overlooked the way in which the principles in this case came to be stated. Your Honour said:

PN655

The appellant is a bankrupt. His estate was sequestrated on 19 February 1935 ...(reads)... and was fixed without taking account of material considerations.

PN656

So it is a sentence of imprisonment following upon, in effect, a plea of guilty. Down towards the bottom of that page, the third last line, there commences the passage which is normally cited:

PN657

The manner in which an appeal against an exercise of discretion should be determined.

PN658

Etcetera. It is well known and I won't read it to the Commission. It goes to about the middle of the next page, the line that contains: "substantial wrong has in fact occurred". Then the judgment goes on:

PN659

Unlike courts of criminal appeal, this court has not been given a special or particular power to review ...(reads)... if we apply the principles we stated.

PN660

Then at 507 in the last paragraph, about .7 on the page, having set out the facts their Honours say:

PN661

In the circumstances we've stated we do not think that we can say the sentence, although severe ...(reads)... or from giving undue weight to any circumstance or matter.

PN662

With respect to those who contend otherwise, whether a termination is harsh, unjust or unreasonable does not involve consideration of a range or a penalty. It does not involve consideration of the question about whether one has gone, as it were, outside the permissible parameters or limits which are set having regard to the application of proper principle and correct appreciation of the law and correct fact findings.

PN663

It is not discretionary, it is just right or wrong. We have argued elsewhere that it won't make much difference in this case because whether one contemplates on the correctness of the decision, or the correctness of the process which includes the correctness of the reasoning, error is sufficiently demonstrated. But we couldn't leave un-answered the rather odd submission which we saw in our learned friend's written submissions to the effect that: we must now be accepting that this is an appeal against a discretionary decision. So far as the primary conclusion is concerned, we do not accept it and it is not. Of course, it is quite different so far as remedy is concerned. Remedy obviously does involve sequential exercise of a number of discretions and different tests apply to appeals in that regard.

PN664

JUSTICE GIUDICE: Does that mean that there can only ever be one right answer to the question: whether the termination was harsh, unjust, or unreasonable.

PN665

MR BUCHANAN: Yes, your Honour, because it is a jurisdictional precondition to the grant of a remedy, as there can only be one right answer to the question of whether somebody is guilty of an offence. We are not in - we have argued in the written submissions. One is not here in the reasonably open territory. Conclusions about things of this client do not survive because they are reasonably open, they are either right or wrong, and neither accept in the most generous sense to conclusions about penalties survive, because they are reasonably open. They are either proper exercises of discretion, or assume to be, or not.

PN666

JUSTICE GIUDICE: The exercise of a judgment is whether something is fair. You say it does not involve the exercise of a discretion.

PN667

MR BUCHANAN: We do say that, your Honour, it does not. It certainly involves a value judgment, but it does not involve the exercise of a discretion. A discretion is a concept that attaches to the doing of an Act. Not the formation of a conclusion, so that you have a discretion when you impose a sentence, for example, that is the exercise of discretion. The imposition of the sentence. The formation of a conclusion is not the exercise of a discretion, and in the present case deciding that a termination was harsh, unjust, or unreasonable is not discretionary, it is a conclusion which is either correct, or incorrect.

PN668

Now, I have mentioned the difficulty about the so-called representative character of the cases and I've also mentioned earlier that there is no finding that the five applicants below were the wrong ones to retrench, and there is no basis to think that they won't be retrenched again. Deputy President Leary - we need to come back to this - but Deputy President Leary seems to think that her orders will be short lived. They were each paid severance pay. The result of the orders ultimately is to give them a substantial extra payment in the absence of any work being performed and, presumably, if there are further reinstatement orders, then the extra payments would be even higher in amount, because longer periods of time would be involved.

PN669

All of this in circumstances where there does not appear, with respect, to have been anything but formal recognition of the fact that there aren't enough jobs to go around. There just aren't enough jobs for everybody. Now, could I go forward just for a moment to the second decision, to paragraph 40, where her Honour says:

PN670

I have considered the evidence of both parties in respect to the effect of any order ...(reads)... for the assessment process to be re-applied.

PN671

So the assumption appears to be that you repeat the process, but it is not a guarantee of long term employment and the orders may be short lived. One might ask rhetorically: how could the process satisfactorily be repeated? And how could it be repeated in circumstances where only 5 of the 82 are there to be considered? How could it be done in a manner that was fair to everybody? What about the other 77, for example? What is their position? What material would be used to make the assessment now in circumstances where none of the employees retrenched have worked for this employer since November 1999?

PN672

In any event, what does one do if anything, with the findings at first instance, even supposing that some intelligible effort could be made? How are they supposed to be used? There is no discussion of their significance for the process, or more importantly for the outcome of the process. There is no suggestion anywhere that the result must necessarily be different. There is no basis to think that the ratings which were assigned, were assigned in a manner which was inconsistent with the assignment of ratings to everybody else, both the employees who were retained in the business and those who were not.

PN673

It does seem to be contemplated that after the formal repetition of the process, the result won't be any different but, with respect, such an outcome is entirely artificial. It does not provide a basis to conclude that the termination should not have occurred and, our submission is, that that is the real test for reinstatement, and it is also the real test for a conclusion that the termination was harsh, unjust, or unreasonable - that it should not have happened. There will of course after that be some circumstances in which it is not appropriate to reinstate and for such circumstances the legislature has provided a facility of awarded compensation. But unless a satisfactory conclusion is available that the termination is taking account of the whole of the circumstances should not have occurred, then in our submission there is no satisfactory basis to move to the next step, and even if one did there would be no reason at all to make orders of reinstatement.

PN674

SENIOR DEPUTY PRESIDENT MARSH: Mr Buchanan, in practical terms would a different outcome be that the employees made redundant, once the process has gone through again, they would be in receipt of the income that they had lost over the period since they were first made redundant?

PN675

MR BUCHANAN: Indeed.

PN676

SENIOR DEPUTY PRESIDENT MARSH: And that the redundancy would be calculated on a higher level of income?

PN677

MR BUCHANAN: It would.

PN678

SENIOR DEPUTY PRESIDENT MARSH: That would be the practical effect.

PN679

MR BUCHANAN: So would the years of service.

PN680

SENIOR DEPUTY PRESIDENT MARSH: Yes, yes, because continuity of service has been restored.

PN681

MR BUCHANAN: There would be a compounding effect at various levels, but the problem with all of that is that, that does not appear to accord satisfactorily with the statutory scheme. If reinstatement is not appropriate, that is reinstatement upon the footing that the employment will, in normal circumstances be ongoing, then the legislation provides compensation, but it provides limits to the compensation and those limits have just been side-stepped, and they have been side-stepped in circumstances where Deputy President Leary says on the one hand: well, I will give credit for a redundancy pay, but immediately upon retrenchment again, the redundancy pay becomes payable again and, as your Honour has pointed out, it becomes payable at higher levels.

PN682

Now, none of that in our respectful submission is what the legislature has in mind and it certainly does not have it in mind that this might be repeated a further 77 times. In circumstances where, ultimately, the only difference to the outcome is that the employer has had to pay very substantial extra sums of money - not for work - not for work performed - but for some procedural failure which ultimately has not made any difference to the practical outcome. Such an outcome in our respectful submission is so out of harmony with the legislative scheme that it is in point of principle quite unacceptable.

PN683

Now, we mentioned in our written submissions just by way of example two decisions of Commissioner Wilkes, where he had taken into account on the question of whether a termination was harsh, unjust, or unreasonable, the levels of severance pay which were payable to those employees. Something that Deputy President Leary did not do, we say, at either point in the proceedings. May we give a reference - hand up a copy of a case, admittedly under the earlier statutory regime, which shows how that can work in the opposite way.

PN684

It is a decision of the then Industrial Relations Court of Australia in a case called Fryar v System Services Proprietary Limited, which is reported at [1996] IRCA 209; 137 ALR 321. The references to Commissioner Wilkes' decisions will be found, if they are needed, at paragraphs 124 to 126 of our written submission. Fryar was a case in which reinstatement, in fact, was not sought. I will come in a moment to a case in which it was. At page 324, at the bottom of the page at about line 42, von Doussa J said:

PN685

The applicants contended before the Judicial Registrar that the notice periods given to each applicant ...(reads)... as no severance payment was made.

PN686

Just going into the extract:

PN687

Because the applicants' employment was taken from them without any fault on their part ...(reads)... harsh, unjust and unreasonable.

PN688

Down at about line 46, his Honour points out:

PN689

In the present case the applicants now concede the correctness of a finding that there was a valid reason ...(reads)... of the reason for the termination is absent.

PN690

And so on. His Honour says at about line 20:

PN691

The interpretation contended for is a narrow one.

PN692

And he refers to some cases which appear to go the other way, concluding at about line 45, with a reference to Kenefick, where Wilcox CJ observed:

PN693

There may be redundancy cases where the termination decision is affected by procedural unfairness making it harsh, unjust, or unreasonable.

PN694

Now, this is all before the present Act and even before the decision of the High Court in Victoria, or in the Commonwealth. At 329, his Honour objects to the argument that was being put at about line 15:

PN695

In my opinion, the contention of the respondent on the interpretation of section 170DE should not be accepted ...(reads)... harsh, unjust, or unreasonable.

PN696

As I mentioned a moment ago that is before - that provision was found to be invalid. Then at 331 at line 30:

PN697

In the present case and the events which happened the applicants ...(reads)... harsh, unjust, or unreasonable.

PN698

Could I, before coming to the next case, give a reference to the case in the Commission where it is recorded that the severance payments payable under the certified agreement applying at Mt Thorley were to be reserved, the reference is 94 IR, page 57 - at page 65 - and I hand up copies. Incidentally, we have the overall redundancy payment figures, but rather than read them out in Court, perhaps we will reduce them to a table and break them up and hand them up.

PN699

JUSTICE GIUDICE: That would be useful, thank you.

PN700

MR BUCHANAN: In this decision Boulton J, on his way to concluding that there was no public interest reason not to set aside the certified agreement which was beyond its nominal date, refers at paragraph 28 on page 64, going on to page 65, to certain arrangements conveyed by a letter from the company. One of which was that:

PN701

In the event that the agreement was terminated, the redundancy packages would be in accordance with the current agreement.

PN702

That amounted to an effective preservation of something which had been agreed between the parties and certified in the Commission for the very circumstances which here occur. But beyond acceptance that there might be some temporary discounting of redundancy payments, that very important circumstance does not appear to have received real attention at any level. Next, may we refer to a case where unfairness was found because of a procedural defect, but reinstatement was found not to be appropriate. It is in our written submission and it is in our folder, it is Manuel v Pasminco Cockle Creek Smelter (1998) 83 IR - it is in volume 2 - it should be the fourth case in volume 2. The case commences at page 135.

PN703

I want to start the extract at 136, at about point 7, where the background is mentioned:

PN704

In April 1996, Pasminco undertook a review of its Broken Hill mining operations. The review concluded that its mining operations were to continue at Broken Hill ...(reads)... retrenched was achieved by first accepting 84 voluntary redundancies and then selecting 46 people for involuntary retrenchment.

PN705

The case was mounted in part upon reliance on section 170DC as it then appeared in the Act and his Honour's treatment of those claims commences at page 146. I want to identify, apart from the overall similarity of that case with this case, I want to identify some important differences with the present case. Firstly, at page 150, when his Honour is dealing with the matter, with the issues concerning Mr Carroll - about 10 lines from the bottom, his Honour says:

PN706

A note prepared by Mr Borlace at the time of the selection records that he did not have current loader or dump truck tickets but - did not have certain bricklaying skills, that his performance was not equal or better in development to ones that were retained, that his uphold giving performance was considered low with respect to Mr Carroll's ability to work flexibly, Mr Borlace recorded: Rob was very selective in the type of work he wanted to perform.

PN707

None of these matters was put to Mr Carroll. In his evidence he sought to challenge their accuracy. He claimed to have skills in many of the areas where Mr Borlace thought they were lacking. A little later in these submissions we are going to come quite directly to the fact that relevant matters were dealt with with the employees concerned and I want to emphasise the distinction between the present case and the manual case. Another Mr Carroll, at page 151, about 5 lines down:

PN708

Mr Hannigan considered Mr Carroll had failed to carry out his duties as a plant man and in a safe and reliable manner in 1995 and for that reason he held the view that Mr Carroll should not again be allowed to perform plant duties.

PN709

This was a factor which worked against Mr Carroll in the selection process as it restricted his flexibility. Mr Hannigan could also consider that employees who were chosen to fill the available positions worked better in a team situation than Mr Carroll. The events of 1995 were discussed with Mr Carroll at the time. I doubt that he was denied procedural fairness in respect of the conclusion by Mr Hannigan that he should work again on the plant. However, the value judgment with others, worked better in a team situation than Mr Carroll is one which raised a question about Mr Carroll's past performance or conduct. Mr Dennis, about 5 lines down:

PN710

Mr Burn was involved in the selection for Fletcher. Mr Burns took into account his observation that Mr Dennis whom he had supervised during concentrated ...(reads)... regularly, a number of relevant skills, that he was less suitable for attention than other available employees.

PN711

In my opinion, these considerations concerned past performance or conduct of Mr Dennis and could have been put to him for his response. The next page, Diamantis - about 5 lines into the extract: Mr Fletcher gain evidence, etcetera - and there is a reference to Mr Diamantis being able to correct a misconception and enlighten him. Toward the bottom of the page - Mr Manuel, about 5 lines from the bottom of the page:

PN712

Had Mr Manuel known of a particular factor he would have made Pasminco aware of the favourable aspects of his medical prognosis...

PN713

etcetera. Mr Napier, at about point 4:

PN714

These are matters concerning the conduct towards Mr Napier which were not put to him.

PN715

Last line:

PN716

He could have corrected the position.

PN717

Mr Parker:

PN718

He could have explained certain things.

PN719

Mr Symons:

PN720

Certain things should have been put to him.

PN721

by Mr McDonald, page 152. Then at 154, his Honour says, top of the page:

PN722

For the reasons given I consider that section 170DC was contravened in respect of each of the affidavits other than Mr Borlace -

PN723

and about point 3:

PN724

I consider the evidence establishes but for the failure to extend procedural fairness in the selection processes required by section 170DC, the termination of the employment of the applicants was relevantly based on the operational requirements of Pasminco's undertaking.

PN725

That is a mighty relevant observation, "but for the procedural fairness", it is based on the "operational requirements". Consistent with Kenefick, and consistent with Senior Deputy President Lacy and Cole and consistent to our submission we would be - for better approach to the issues of construction under paragraph (a).

PN726

Now, those findings were made because there was relevantly no opportunity to deal with matters that his Honour felt should have been squarely raised with the employees. The present case is manifestly different to that for reasons which I will come to. We want to draw attention, however, to how his Honour applied these findings to the question of remedy with which he deals from the bottom of page 156. He says:

PN727

Reinstatement orders are made by the Judicial Registrar in respect of Messrs R Carroll, P Carroll, Napier and Manuel. Each of these applicants at the time of the ...(reads)... in section 170EE(2), which empowers the Court to award compensation if the Court thinks that the reinstatement of the employee is impracticable.

PN728

The decision of Anthony Smith must be understood in the context of the particular facts of that case. In my view, the facts are quite unlike those presently before the Court. In particular, by the time the reinstatement order was made in that case there had been an unexpected upturn in the fortunes of the company's business.

PN729

And then, going to the - his Honour then deals with a long established history of declining fortunes. Then he deals with reliance that was made upon the facts that deal with Contractors - about point 7, his Honour says:

PN730

However, the engagement of contractors in construction and maintenance and the use of contractors and overtime to cover fluctuations in work demands will establish practices before the restructure and irrational management techniques that do not invalid the rationale will of necessity to a restructure.

PN731

Then his Honour says:

PN732

Once it is accepted that the operational requirements of Pasminco's undertaking required after allowing for voluntary redundancies - a further 46 involuntary retrenchments ...(reads)... entitlement for reinstatement must be assessed according to the provisions of the Act as a consideration of whether reinstatement is in all the circumstances, impracticable.

PN733

Pausing there the tests now are whether it is appropriate than impracticable but that is a matter which his Honour addressed. It is still required to be decided in all the circumstances of the case.

PN734

JUSTICE GIUDICE: Was impracticable the word used in the statute?

PN735

MR BUCHANAN: Yes. It was, your Honour. Terminations are now not unlawful in the absence of procedural fairness. That is an important difference as pointed out in Windsor Smith. That is just one circumstance and not decisive. At its worst for us and I don't mean to suggest in any sense that I am attempting to pitch these submissions in some alternative way but at its worst for us in this case just as in the Manuel case it should have been concluded that re-instatement was not appropriate. Whereas in that case and here the terminations are for valid operational reasons and jobs are limited.

PN736

Deputy President Leary does not mention this case in either decision notwithstanding that it was relied upon and that it is making allowance for the change in the statutory scheme it is, in our submission, of direct relevance upon an appropriate point of principle. We also gave a reference in the written submissions, I won't go to it again now, to a judgment of Ryan J in Diprose v Simplot in 94 IR 330 at 346 where the same approach was taken by the question of practicability.

PN737

I want to come more directly now to the very important difference between procedure and substance. There was an important clarification of the law in a judgment of the High Court in Burn v Australian Airlines but to appreciate its whole significance for the purpose of the present case it is necessary to trace the course of the litigation and go through each of the preceding decisions on the way to the High Court judgment. The first of them was a judgment of Hill J in the Federal Court of Australia reported in 45 IR page 178, I hand up copies.

PN738

May I remind the Commission that the cause of action was an action for breach of award under what was then section 178 of the Industrial Relations Act 1988. In circumstances where the award itself contained the provision prohibiting terminations of employment by an employer which were harsh, unjust or unreasonable. That is exactly the same words as are used in the present legislation and exactly the same words as appeared in the earlier legislation prior to the decision of the High Court in Victoria and the Commonwealth.

PN739

Commencing at page 195 under the heading: The Applicant's Submission, his Honour said:

PN740

The starting point of the applicant's submissions on what, in effect was their real case, mainly the claim for damages against the airline -

PN741

I should have mentioned, of course, that there was a claim in the accrued jurisdiction which was where the money was to come from based on the principles said to come from Gregory v Phillip Morrison, Wheeler v Phillip Morrison. His Honour goes on:

PN742

...was that the provision of clause 11(a) of the award were incorporated into the contract of service between the airline and each of the applicants. It was then said that the requirement of the termination be not harsh, unjust or unreasonable carried with it a number of obligations which had to be observed by the airline in terminating the services of an employee. Failure to observe any of them led, it was submitted, to the result that the termination would be harsh, unjust or unreasonable and in consequence a dismissal would be wrongful thus entitling the applicant's to damages.

PN743

At page 197, at about point 9, the last paragraph, his Honour said:

PN744

It is, in my view, undesirable to attempt a definition of each of the words harsh, unjust and unreasonable. These words are ordinary non-technical words which are intended to apply to an infinite variety of situations where employment is terminated.

PN745

Bostick:

PN746

There significance lies in their flexibility, their capacity to be applied to a multitude of situations. What is harsh, unjust or reasonable would depend among the circumstances of each case. There are no doubt perceptible differences of the meaning in each word although there is considerable overlap.

PN747

In Thompson:

PN748

In the end what is required is the majority.

PN749

Gregory observed:

PN750

...is a process of judicial evaluation of proved facts.

PN751

Then at page 199, his Honour said at about point 2 or 3:

PN752

Reliance is placed by counsel for the applicants on what was said by Gray J in Wheeler on the significance of events occurring after the dismissal.

PN753

His Honour said:

PN754

Under the earlier law relating to wrongful dismissal it was open to an employer to justify dismissal retrospectively by reference to facts not known to the employer ...(reads)... conclusion that there had been a breach of clause 6B(6) even if the facts do turn out favourably to the employer upon later investigation.

PN755

End quote. With respect to his Honour if it be true that no regard may had inter alia to a subsequent correct analysis of the facts that is not a result that stems from Gregory. All the majority in Gregory said which bears upon the matter is contained in the passage sighted earlier their Honours were looking at the converse of the situation involved in Wheeler namely whether a dismissal contravened the award provision if later it should turn out that the true facts were different from those which appeared at the date of the dismissal.

PN756

In the circumstances of Gregory a comment was made in the context that the fact that the expulsion turned out later to be invalid did not make the dismissal which took into account the expulsion unfair. Then his Honour refers to passages in a judgment of von Doussa J in Lane v Arrow Crest Group Proprietary Limited where his Honour gave some examples of circumstances in which it would be permissible to look at subsequently acquired knowledge. Then at page 200, at about point 3, his Honour said:

PN757

While it may be accepted that there is a need in the interest of fairness for the employer to investigate the facts when misconduct is alleged against an employee ...(reads)... the applicants in absolute terms necessarily required to carry out a full inquiry which would duplicate that carried out by the police.

PN758

Next paragraph:

PN759

The true position is that a termination will be in contravention of the award where the circumstances are such that the facts cited as justifying it are either not ...(reads)... there are reasonable grounds to conclude them to be true. The extent of the investigation required, if any, will depend upon all the circumstances.

PN760

Now, his Honour went on to say that he wasn't satisfied there had been a breach of the award and there wouldn't be any damages. An appeal was brought to the Full Court of the Federal Court and presumably because of the need to deal with and reconsider earlier Full Court decisions a five member bench was constituted. We hand up copies of the Full Court judgment which is reported in 47 Federal Court reports page 300.

PN761

This case dealt with a large number of issues most of which are not important in the present - - -

PN762

JUSTICE GIUDICE: Not important to this case.

PN763

MR BUCHANAN: I am sorry, your Honour.

PN764

JUSTICE GIUDICE: Not important to this case.

PN765

MR BUCHANAN: Not important to the present case. There is one issue that is and the Commission will see that the judges of the Federal Court where in substantial accord. This is not open of the areas in which there was a major dissent. Black CJ at page 303 between letters (d) and (e) said:

PN766

Hill J considered that in connection with a contemplated termination of employment clause 11A imposed on an employer an obligation to give procedural ...(reads)... combination of circumstances to which Gray J has referred the termination of the employment of each appellant was unjust and unreasonable.

PN767

Keely J at page 313 at about letter (f) said:

PN768

I agree with the conclusion of Beaumont J and Heerey J that the respondent's termination of the employment of the two appellants was unreasonable at least in a procedural sense and accordingly was in breach of clause 11A of the Transport Workers Airlines Award 1998 and I agree generally with their reasons for that conclusion.

PN769

His Honour's concurrence makes what Beaumont J and Heerey J said the ratio of the case on this point but I will refer also to what Gray J said. At page 329 Beaumont J and Heerey J say about letter (d):

PN770

As has been seen the appellant has contended his Honour did not address the correct question and it should have been held that the termination of their employment lacked both substantive and procedural fairness. These contentions raise a number of questions of mixed factum law which we propose to take in stages.

PN771

Then down at the bottom of the page under letter (g) having agreed with the passage that I read about the meaning of the words they say:

PN772

However, we are unable, with respect, to agree with the approach taken by the primary judge for the application of the provisions of clause 11A in the circumstances of the present case. In our opinion, the way in which the respondent went about terminating the employment of the appellants should have led his Honour to conclude that in each case the termination of the employment was at least unreasonable. It may also have been harsh or unjust but we need not express an opinion on this.

PN773

Then going down to below letter (f) their Honours say just to introduce the finding they make:

PN774

In failing to pursue this potential source of information in a context where serious doubts had been raised about what had actually happened on the day in question the respondent, in our view, acted in a manner that was not in the circumstances which was to be expected of a reasonable employer. It is one thing for an employer to decline to pursue a line of inquiry where there exists other sources of reliable information it is another thing as here fail to speak to a witness present on the occasion especially when any wrong-doing has been denied by others. On this ground alone we think that the respondent was in breach of clause 11A.

PN775

Then on the next page, 331, letter (c):

PN776

The failure of the respondent to interview Mr Harvey is not of course to be looked at in isolation but when the whole of the surrounding circumstances are looked at they tend to confirm the conclusion that the respondent acted unreasonably. Further on any view of the time taken by the respondent to bring the video to the attention of the appellants more than five months was extremely long.

PN777

So just going back I should have read a very short passage at the top of 330:

PN778

In the first place we think it was unreasonable of the respondent not to interview Mr Harvey.

PN779

That was the first ground for their Honours' conclusion. The second was the one I have just mentioned on 331 just above letter (d) the time taken to bring the video to the attention of the appellants and the third appears just below letter (e):

PN780

Another unsatisfactory aspect of the matter, in our opinion, was the failure of the respondent to convey to the appellants the view that the respondent held of their conduct was evidenced by the proceedings recorded on the video.

PN781

Further, it is about at the bottom of 331:

PN782

In our opinion the conduct of the respondent in attempting to bring to the attention of the appellants exactly what it was that the respondent was complaining about so far as they were concerned fell short of the standards that are reasonably expected of a reasonable employer.

PN783

Then at 332, letter (d):

PN784

For these reasons we are of the view that a breach of clause 11A has been established because in a procedural sense the respondent acted unreasonably. As has been noted the appellants further submitted that the respondent also acted unreasonably in a substantive sense. That is to say they contended that on the evidence before his Honour there should have been a finding that, in fact, the appellants had not been guilty of any wrong-doing in relation to the loading of the aircraft or at any rate that the employer had not established this to be the case. It is not necessary that we deal with this alternative argument and we express no opinion on this aspect of the matter.

PN785

So there were three particular matters. They were all in the area of procedural shortcomings. There was no attention to substance. Gray J at 356 deals - I am not going to read all this but from just above letter (c) his Honour deals with obligations to afford natural justice and he concludes at about letter (g):

PN786

That a clause such as 11A requires that an employer contemplating terminating the employment of an employee is obliged to afford procedural fairness employee. Not to do so -

PN787

his Honour says -

PN788

was just unjust.

PN789

JUSTICE GIUDICE: Sorry, where is that, Mr Buchanan?

PN790

MR BUCHANAN: It is 356, your Honour, around about letter (g).

PN791

JUSTICE GIUDICE: Yes, thank you.

PN792

MR BUCHANAN: After a longer discussion of the general principle.

PN793

JUSTICE GIUDICE: Yes.

PN794

MR BUCHANAN: That is further emphasis, of course, that it was the denial of the procedural fairness that constituted the breach of the award regardless of the substance of the matter, regardless of the reality, regardless of whether the conduct had existed or not and it was for the denial of procedural fairness that a remedy was granted or was to be granted as it was in this case. Before I go to the High Court decision may I go again to the two decisions here under appeal.

PN795

In order to emphasis the apparent automaticity of the reasoning process in the first decision, in paragraph 117, her Honour had drawn attention to the complaint being about processing and selection, rather than the reason for terminations. In paragraph 127, as I pointed out earlier in these submissions, there's further reference to process, as there is in paragraph 129. Then in paragraphs 130 and 131 her Honour deals with, what she describes as "a fairness test" and identifies the area in which she was applying it, that is, not on the question of whether the system was an appropriate system, but on the question of whether it had been applied fairly consistently and objectively. In circumstances where she said: there were serious allegations about the fairness of the system and the allegations had not been counted with sworn evidence.

PN796

Immediately upon a statement of those conclusions her Honour, in paragraph 132 said accordingly: I find the provisions, as I said, have not been satisfied. In the second decision, at paragraph 30, her Honour again used the notion of process. For example, in the last four lines in paragraph 30 at page 9, her Honour says:

PN797

MTO is the right destructor ..... work-force however it sees fit with contractor employees or permanent employees, providing that any process to reduce current numbers to meet that objective is undertaken fairly.

PN798

In paragraph 40 she refers, in the passage that I read earlier, to there being an opportunity for the process to be repeated and for the assessment process to be reapplied. So the outcome revolves entirely around conclusions about the process, there's no finding that in substance the terminations were justified in the sense that other people should have been retrenched. There was finding of any substantive, as opposed to procedural breach of any supposedly obligation, and one finds in this case, therefore, a parallel with the Byrne v Australian Airlines circumstance as one, with respect, would find a parallel with the Manual case that I referred to earlier.

PN799

JUSTICE GIUDICE: Mr Buchanan, there are some factual - of course, when I say factual differences, it is not the right expression, but Deputy President Leary does go through some of the complaints that were raised, as to whether a particular comment on an appraisal form was justified, I'm speaking generally now but you are aware of that sort of evidence.

PN800

MR BUCHANAN: Yes, I'm going to come to them, I'm going to - - -

PN801

JUSTICE GIUDICE: Yes, but that does provide some basis for a conclusion, does it not, that there was unfairness?

PN802

MR BUCHANAN: It provides a context, your Honour, in the same way that in the Byrne v Australian Airlines case the video and the other allegations provided a context, but it is a context which leads ultimately to conclusions about process, because - - -

PN803

JUSTICE GIUDICE: You can't dismiss, I don't think, evidence which might indicate that decisions were based on a false assessment of the capability of a particular employee or their performance record, is you like. You can't simply say: well, that is just procedural, can you? I mean, looked at from the Deputy President's point of view, she has evidence which suggests that the company may have simply acted on a wrong assessment because of factual errors.

PN804

MR BUCHANAN: Let me accept that for the moment, although we are going to challenge the finding.

PN805

JUSTICE GIUDICE: Yes.

PN806

MR BUCHANAN: The significance of that is never explained, except perhaps that it is regarded as a failure of the process. The way in which this is ultimately all drawn together is in paragraph 132 where her Honour says:

PN807

As the applicants have not been given an opportunity to respond to the reasons for their selection, or if they have provided a response it has been disregarded.

PN808

Now, leaving aside for the moment the fact that those two ideas are directly contradictory. The factual findings that she makes don't seem to find their way into any findings on issues of substance.

PN809

JUSTICE GIUDICE: Yes, but I suppose that it might at the end of the day of characterisation. If she is right about the evidence - - -

PN810

MR BUCHANAN: She would have needed to have gone a lot further, your Honour, she would need to have said: I'm satisfied that there was some erroneous evaluations made earlier in time than the selections for retention.

PN811

JUSTICE GIUDICE: Yes, well, I agree with you, she does ..... with terms of procedure.

PN812

MR BUCHANAN: And that something would have flowed from that. The conclusions stop well short of that point. She gets to the point where she says:

PN813

I'm satisfied that there's not been an opportunity, therefore -

PN814

and she says expressly:

PN815

I find, therefore, that the termination was harsh, unjust or unreasonable.

PN816

JUSTICE GIUDICE: Yes.

PN817

MR BUCHANAN: That leads, as we put, to the - virtually automatically to the reinstatement. Your Honour, it is in that sense that we say that there is a very close parallel with the way in which the Federal Court approached the decision in Byrne v Australian Airlines. Not necessarily, to deal with the substance.

PN818

JUSTICE GIUDICE: If we were persuaded by your submission that the Deputy President had wrongly characterised the effect of 170CG(3)(c) and (d) to be, as it were, an inflexible rule of governing the procedure for termination - - -

PN819

MR BUCHANAN: Yes.

PN820

JUSTICE GIUDICE: - - - and that she had simply said: well, they weren't properly observed, therefore the rest follows: it is harsh, unjust or unreasonable. If we were to accept that submission - - -

PN821

MR BUCHANAN: Yes.

PN822

JUSTICE GIUDICE: - - - wouldn't we, nevertheless, be faced in the resolution of the appeal with the factual findings which cast - when I say "findings," again, perhaps that is putting it too high, but the evidentiary material, which suggests that the assessments may not have been properly carried out?

PN823

MR BUCHANAN: It would be open to say: if her Honour was permitted to take this material into account at all it would have been under paragraph (e) or generally it was, with respect, to her conclusion about the central question.

PN824

JUSTICE GIUDICE: Yes.

PN825

MR BUCHANAN: Such findings could not result in the conclusion that the terminations themselves, taking all circumstances into account, were harsh, unjust or unreasonable. In the absence of some greater degree of connection with the matter of substances, because the findings - your Honour, the findings, which I've yet to come to, don't go anywhere.

PN826

JUSTICE GIUDICE: Yes, well, we have yet to hear your submission.

PN827

MR BUCHANAN: They are really illustrative, apparently, of defects in the process.

PN828

JUSTICE GIUDICE: Yes, thank you.

PN829

MR BUCHANAN: Can I come to the High Court judgment? This case is in our folder. It is in volume 1 of tab 10. It is reported at 185 CLR 410 and like the Federal Court, the High Court on this issue was unanimous but directly contrary at - I'm sorry, it is 185 CLR 410. Now, this case was decided before Victoria v The Commonwealth and in circumstances where there was no real issue being raised about the application of a test like this. At 411, head-note 6:

PN830

It could not be concluded that the award had been breached by reason of the procedural pleading making the dismissals without considering whether there was sufficient evidence to establish that the employees were involved in alleged misconduct in any event.

PN831

Going to the discussion at page 430 in the majority judgment at about point 2.

PN832

SENIOR DEPUTY PRESIDENT MARSH: I'm sorry, what page was that, Mr Buchanan?

PN833

MR BUCHANAN: 430.

PN834

SENIOR DEPUTY PRESIDENT MARSH: Thank you.

PN835

MR BUCHANAN: It is the last section of the majority judgment at about point 2 where their Honour's say that:

PN836

The respondent seeks special leave to cross appeal against the finding of the Full Court the dismissal of the appellants was unreasonable.

PN837

The ground advanced by the respondent is that whilst the adoption of an unfair procedure may render a dismissal harsh, unjust or unreasonable, whether it does so or not must depend upon the whole of the circumstances:

PN838

The respondent contends that having failed to consider whether the evidence established that the appellants had been involved in pilfering, the majority in the Full Court were in no position to determine whether the procedure adopted resulted in their dismissal being unreasonable.

PN839

In our view, that contention is plainly correct save for the prescription of periods of notice clause 11 does not require the adoption of any particular procedure for the dismissal of an employee. In other words, clear that the use of an unfair procedure may result in the dismissal being harsh, unjust or unreasonable. For example, failure to afford an employee the opportunity to explain apparent misconduct where there is an innocent explanation available would result of the dismissal of an employee being in breach of clause 11(a). On the other hand, if an employer would observe the actual misconduct of the employee in circumstances which allowed no innocent explanation, a summary dismissal might not be in breach of clause 11(a).

PN840

The facts which existed at the time of the dismissal but which came to light only subsequently might justify the dismissal when otherwise it would be harsh, unjust or unreasonable. It was not therefore a permissible approach for the Full Court to reach a conclusion adverse to the respondent based upon the procedure employed in dismissing the appellants without considering whether the Trial Judge was correct in reaching the conclusion that there was sufficient evidence to establish the appellants were involved in the misconduct alleged against them.

PN841

Applying those observations here, they being in our respectful submission on all fours in point of principle, you cannot determine that a dismissal is harsh, unjust or unreasonable unless consideration is given to whether it was unjustified in all the circumstances. The High Court was dealing here with precisely the same language that arises for consideration on this appeal and if viewed with respect as plainly correct, a proposition that accords with the way in which the Commission has applied the current provisions, particularly as exemplified by the Full Court decision in Windsor Smith.

PN842

You simply cannot get satisfactorily to a conclusion on the principle question without coming to deal with questions of substance and in particular whether in all the circumstances the terminations were unjustified. In the other judgment at page 435, your Honour will see it at about point 4, Hill J held that each appellant had been given the opportunity to put his side of the story and that their failure to provide an innocent explanation resulted in there being reasonable grounds for the respondent to conclude that each appellant had been participating in criminal acts, a belief reasonably held that the appellants were involved in the pilfering of baggage, justified their peremptory dismissal. Then there's a quotation from his Honour. Your Honours go on:

PN843

In this Court the contentions of the appellants before the Full Court were re-agitated in some instances with embellishments and additions. The respondent contests the holding by the Full Court that the dismissal procedure had been unreasonable and seek special leave in each proceeding, the cross appeal, that leave should be granted.

PN844

The respondent also submits that the Full Court erred in not considering whether in all the circumstances of the case including the findings by Hill J is to the complicity of the appellants in pilfering, the termination was in breach of the award. The submission is that the Full Court did not deal adequately with the question of breach of the award because it dealt only with the procedural aspect of the dismissal of the appellants and had not given weight to the substantive of the matter the dismissal for involvement in the pilfering of luggage.

PN845

Here of course in the present case, the substantive aspect is whether the employer was justified in preferring other employees for retention. That involved questions of judgment which ultimately work for the employer to make unless it could be shown that it had acted inconsistently or in some discriminatory way or something of that kind. There's no finding of inconsistency here and no finding of discrimination, such allegations being rejected by her Honour. At 462, their Honours say at the bottom of the page:

PN846

The issue here is whether the termination of employment of the appellants were in breach of the award. Hill J found that there had been no breach and the Full Federal Court on this issue, Kelly J agreed with the reasons of Beaumont and Heerey JJ.

PN847

Your Honours commenced their treatment of the matter by noting three main arguments advanced on behalf of the appellants. One was that the dismissal procedure was unfair, earlier in these reasons we've summarised the findings by Hill J of the facts that led up to the dismissal of the employees. In the middle of the page, your Honour is saying that joint judgment, Beaumont and Heerey JJ went on to refer to two further arguments advanced on behalf of the appellants. Then going to the bottom of the page, Beaumont and Heerey JJ concluded that for those reasons a breach of clause 11 had been established. This is because in a procedural sense the respondent had acted unreasonably. Then going to the middle of the page on 464:

PN848

It is also apparent that the majority had proceeded on the footing that termination of employment might be unreasonable within the meaning of clause 11(a) by reason of procedural deficiencies without the need to go further into substantive aspects of the matter.

PN849

Unless that construction of the award is to be upheld, there is substance in the cross appeals by the respondents that the Full Court reverse the finding in its favour that there had been no breach of the award without determining the necessary question, whether the primary judge had erred in finding that there had been dishonest conduct in the handling of the baggage. Now, going across to page 465, about the middle of the page, there's a reference to a ground of race colour, sex and marital status and then reading on from there, your Honours say:

PN850

It may be that the termination is harsh but not unjust or unreasonable, unjust but not harsh or unreasonable, or unreasonable but not harsh or unjust ...(reads)... economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted.

PN851

I just pause there to make this very brief submission but where all three are found, one would expect some explanation to be given. Her Honour for reasons are nowhere explained found each of the terminations to be harsh, unjust and unreasonable. Such a finding really called for some discussion of why it was that each of those epithets might clearly have been applied. Their Honours go on:

PN852

The distinction between procedure and substance is elusive. This is so even in those few of the private and the national law, the statute law dealing with the limitation of action to the effect upon accrued rights, the statute of fraud where it hasn't infringed operation in our view, it is unhelpful and contrary to the tenor of the award to introduce it into clause 11(a).

PN853

That is not to say that the steps taken are not taken before termination may not in a given case be relevant to consideration of whether the state of affairs that was produced was harsh, unjust or unreasonable, thus it has been said that a decision which is a product to unfair procedures may be arbitrary, irrational or unreasonable. The question under clause 11(a) is whether in all the circumstances the termination of employment disobeyed the injunction that it not be harsh, unjust or unreasonable. That is not answered by imposing a disjunction between procedure and substance.

PN854

It is important that matters not be decided simply by looking by looking to the first issue before there is seen to be any need to enter upon the second. Then their Honours pointed out that those conclusions were consistent with cases decided elsewhere and earlier so they were referred for example at the bottom of that page to Hocking v The Public Service Association of South Australia. It indicates that:

PN855

The task of Industrial Court under the South Australian legislation was to determine whether in all the circumstances of the case the employee had demonstrated that the dismissal was harsh, unjust or unreasonable.

PN856

So that whilst the method of adopting and carrying out the dismissal as distinct from the dismissal itself might be said to be unjust or unreasonable, that would not be the end of the matter. There was a reference to Lane v Arrow Quest and then at 468, their Honours say:

PN857

The propositions we have set out support the submissions for the respondent as it was necessary for the Full Court to look at the whole of the relevant circumstances which were taken into account by the primary judge in determining whether there had been no breach of the award and in particular that it was an error to reverse that ultimate holding purely for reasons associated with what are identified as procedural defects in the steps taken by the respondent to dismiss the appellants.

PN858

The procedures adopted in carrying out the termination might properly be taken into account in determining whether the termination thus produced was harsh, unjust or unreasonable. The submissions for the respondent in the present appeals appeared to concede this but the burden of the respondent's submissions is that there was error in determining the issue without regard to the very material circumstances of finding of the primary judge as to the complicity of the appellants in pilfering.

PN859

Those submissions should be accepted. This means that the primary judge was bound to consider whether on the evidence given at the trial, the respondent could resist the allegation of breach of clause 11(a) provided that the evidence of certain circumstances in existence when the decision to terminate employment was made. A further consequence is that it remains for the Full Court to determine whether Hill J erred in his finding of fact as to complicity and pilfering and if both findings are upheld, it would be very difficult to see how the dismissal of the appellants would be regarded as harsh, unjust or unreasonable.

PN860

In the present case of our submission unless it could be said that the applicants should not have been retrenched because somebody else should have been, it could not have been concluded that in substance the terminations were harsh, unjust or unreasonable, particularly in circumstances where there have been the payment of appropriate amounts of severance pay. There was no attention to that issue at all. The case turned entirely on issues of procedure. Having said that and submitting again at this level the case miscarried, we want to come to deal more directly here the criticisms about the procedure that was followed because, with respect your Honour, those criticisms are neither fair nor appropriate.

PN861

We've argued why in the written submissions and again in section 170CG(3)(c) and (d) have no applications. We maintain those submissions which we say are correct in law but let me come to confront the issue head on as those provisions have a role to play. Of course what I say, your Honours and Mr Commissioner, will be equally relevant to the possibility that these were matters that could have been taken into account, for example in the paragraph (c). Nobody was retrenched for unsatisfactory service as such. Section 170CG(3)(d) is plainly not relevant.

PN862

In any event, it can't arise above matters going to section 170CG(3)(c), so let me concentrate on that. Paragraph (c) is about opportunities. It is not about outcomes. It says the Commission must have regard to whether the employee was given an opportunity to respond to any reason related to the capacity of conduct to the employee. An opportunity to respond, this does not open the door nor provide a reason for the Commission to embark upon an adjudication of the way in which arguments at the work place about performance have been ultimately resolved.

PN863

Providing an opportunity is given and providing there is a reasonable level of consideration to what an employee says on his own behalf, it is with the greatest respect not the Commission's general task to make decisions which it could not possibly in a practical sense ever adequately make being denied the work place perspective which is involved. Litigation about disputed issues of fact is sufficiently difficult without the temptation to make what really are value judgments in the absence of all the relevant material including the opportunity to observe employees work performance under extended periods of time.

PN864

The applicants, as we pointed out in our written submissions concentrated their case virtually entirely on the performance reviews which took place in the 12 months leading up to the termination of employment. They seem to avoid altogether the selection process itself, preferring to take issue with this rating or that rating, this comment or that comment which had occurred in the earlier exercises. The performance reviews were just a starting point. They were obviously influential. They provided data but it was the interview process as a whole that selected employees for attention.

PN865

The ratings in the performance reviews were clearly notified to employees. They were provided with copies of the appraisals as were the accompanying comments. There was a right to respond immediately, that is upon receipt of the performance appraisals and that right was used. There were appeals which were known as resolution of disagreements or RDFs. They were dealt with. In the first decision at paragraph 127, her Honour says, in the second line of 127:

PN866

The applicants complained that they were not given the information sought and that the process was not applied in accordance with MTOs own guidelines.

PN867

That evidence remains largely unchallenged. Certainly a number of assessments were increased or improved following review. However, any change was not sufficient to allow the applicants to be maintained in employment. It cannot be found in this case that the system was wholly and blindly unresponsive, that it responded in a way that was in effect complete and absolute disregard of anything the employees had to say. The evidence is completely against that. There were letters written to each of the applicants and they had each exercised their rights of appeal, four of them I think twice, one of them once.

PN868

There were letters written to each of the applicants conveying the outcomes of the appeals and I will go to some of them shortly but those very basic and bare facts represent the fact that an opportunity was available, the opportunity was taken and progress was made. Three of the applicants had ratings increased for either the first performance appraisal or the second one as a result of the representations which they made and which were considered.

PN869

It must be remembered also that there were large numbers of appeals. These were not one-off cases. About a third of the work force actually used the opportunity. No conclusion is available with respect that any of the applicants were treated unfairly either in isolation or in relative terms. Now, although that material was influential and although it had been made clear for reasons that we explained in the submissions that such information would be used in a redundancy process if that occurred, they were not the things ultimately or the only things certainly upon which the decisions turned.

PN870

When the process of selection had been determined again as with the performance appraisals with the benefit of advice from external consultants, when the process of selection had been determined, that is if there were to be an interview process, employees were told what was involved and how it would work. They received training in the process. The purpose of the interviews was explicit. The material to be used was disclosed and ratings resulting from the performance reviews as adjusted were known to them. Each applicant was asked whether he wanted to say anything more about his work performance after the second performance review or about either of the performance reviews.

PN871

We've set out their responses in the written submissions. That there could reasonably be an allegation of lack of opportunity to respond, much less a finding to that effect begs belief. It is only if one ignores completely the language of the legislation that one gets from that factual circumstance to a finding that any supposed requirement had been ignored or breached. Nevertheless we want to come to the particular findings that were made. Deputy President Leary referred in paragraph 152 to a decision referred to by the applicant's below in which he set out an extract in these terms:

PN872

When a reason for termination is based on the conduct of the employee the Commission must if it is in issue in the proceedings challenging the termination ...(reads)... what it involved.

PN873

Now, where a dismissal is for misconduct it may be accepted that the Commission can look at the underlying facts to see whether in substance the dismissal is unjustified. In other words it may be accepted that the Commission can look to the question of whether the reason is a valid reason which is what the extract that her Honour sets out goes to. But here the attempt to resolve particular grievances stretching back into the past involving disagreements with this supervisor or that supervisor was with respect misplaced and much too remote from the circumstances of the terminations.

PN874

I will take them in the order in which her Honour deals with them in the decision. The worst one is, on one view of it is first that of Mr Shannon. Her Honour says at paragraphs 82 to 3 and at 87:

PN875

Mr Shannon lodged a PR1 RDF which was reviewed by Mr Davies and resulted in two ratings being increased. Mr Shannon pursued ...(reads)... no ratings were increased.

PN876

Going to paragraph 87, because this - - -

PN877

JUSTICE GIUDICE: Just before you do that, Mr Buchanan, paragraph 82, I don't quite follow the second sentence. There was an RDF which is a resolution of dispute form in relation to PR1. It is then said Mr Davies reviewed it, reviewed the appraisal, the performance review and then it says Mr Shannon pursued his RDF. Was there an opportunity to appeal to a higher level was there?

PN878

MR BUCHANAN: No, no. Mr Shannon purported to file a notice of a dispute under the certified agreement.

PN879

JUSTICE GIUDICE: In relation to - I see.

PN880

MR BUCHANAN: In relation to both of his appraisals and it was met with the response that so far as the review process was concerned it had been finalised. It was the existence of the second one that apparently caused Deputy President Leary to observe that there were outstanding reviews, I don't know whether she used the word "reviews" or appeals but outstanding challenges at the time the dismissals were in fact accomplished and that was a reference to this notice of dispute procedure that he had attempted to invoke but it was outside the system which had been established for dealing with these matters.

PN881

JUSTICE GIUDICE: Yes, I see.

PN882

MR BUCHANAN: Paragraph 87 her Honour deals with what appears to be the gravamen of the matter so far as Mr Shannon is concerned. She said:

PN883

Mr Shannon had received an unfavourable assessment of his PR2 where it was alleged that he had misrepresented a clothing issue by claiming not to have received his entitlement when in fact he had ...(reads)... refute the evidence of Mr Shannon.

PN884

Now, just pausing there for a moment, neither was he called by Mr Shannon. Hearsay evidence from Mr Shannon or any of the other applicants does not cease to be hearsay if technical hearsay is to be regarded as important just because it comes from an applicant, not a respondent and at the end of the day the real test is whether the evidence is relevant, not whether it is hearsay. Her Honour goes on:

PN885

Taking the evidence on face value and in the absence of any rebuttal the alleged reasons for Mr Shannon receiving a low assessment seem at best heady ...(reads)... retrench people.

PN886

Now, at the end of 91 her Honour says:

PN887

Mr Shannon received an unfavourable assessment based on two incidents about which he puts an entirely different focus than MTO. I prefer Mr Shannon's evidence.

PN888

In one sense this whole exercise was misplaced. He wasn't dismissed for any of this. He was dismissed upon an overall assessment which left him not selected for retention rather than being dismissed for any particular conduct. Some of it didn't appear to bear directly upon his performance review in any event and I come to show why that is so in a moment. There was ultimately no finding that Mr Shannon had been targeted in some sense or discriminated against or selected for retrenchment despite his merits to remain in employment.

PN889

The issue really went nowhere at the end of the day and it certainly is not a sufficient foundation to conclude that he didn't have an opportunity to raise these issues because as I will show in a moment he raised precisely these issues in his appeal in relation to his second assessment. Now, I then need to take the Commission to some of the material and the easiest way, the most efficient way to do it will be to go to the folders of appendices which were provided with our written submission where each of the documents that I want to refer to can be found. The first one is at volume 2 tab 4 which is the first tab and then it is going to be necessary for the Commission to go into this material a little bit further to find RD20 which was an annexure to exhibit MTO8.

PN890

In this appendix which is appendix 3 are contained the various documents relating to the appeals of each of the applicants.

PN891

SENIOR DEPUTY PRESIDENT MARSH: Is this the resolution of disagreement form?

PN892

MR BUCHANAN: Yes, it is, your Honour.

PN893

SENIOR DEPUTY PRESIDENT MARSH: Good.

PN894

MR BUCHANAN: You will see at the bottom of the first page - I'm not going to go to great detail about this document but at the bottom of the first page you will see that he - it might be easier to work back from tab 5. If you look at the bottom of the first page of this form you will see that he challenged 10 matters and then just very quickly flipping through them, I'm not going to dwell on this for the moment. You will see that whether he was rated as "meets expectations," which is the first two, or "unacceptable," which is the third one, fourth one, he said that in his view he should have been - could have been rated excellent. There was one where he said he should have been rated "exceeds expectations." So there were a number of those.

PN895

JUSTICE GIUDICE: This is in relation to the second performance review?

PN896

MR BUCHANAN: The second one.

PN897

JUSTICE GIUDICE: Yes.

PN898

MR BUCHANAN: Now, if the members of the bench can find the ratings in relation to 2.1 and 2.2 you will see that he thought that rather than being rated unacceptable he should have been rated excellent. The first one related to a suggestion that he was rude and abrupt and the second one raised directly the question of the clothing issue and the first-aid training. Now, I want to come then to the next annexure which was marked RDF21. It is a letter to him dated 21 September 1999 from Mr Davies who gave direct sworn evidence in the case.

PN899

JUSTICE GIUDICE: Yes, where are we now, Mr Buchanan?

PN900

MR BUCHANAN: RDF21, your Honour. It is a letter of 21 September 1999 addressed to Mr Shannon.

PN901

JUSTICE GIUDICE: Dear Justin.

PN902

MR BUCHANAN: Dear Justin.

PN903

JUSTICE GIUDICE: Thank you.

PN904

MR BUCHANAN: In the third paragraph it is pointed out that he sought a rating of excellent or exceeds expectations against each dimension and there's then some discussion of the standards which are used for the appraisal. Relevantly for the present purposes I'm going to pass over the rude and abrupt thing but the discussion of that is on page 3. Perhaps I should just draw attention without going through this in detail to the paragraph in the middle of page 3 where Mr Davies refers to conversations that he has had with various people, three of them, about Mr Shannon's allegations.

PN905

In the proceedings before Deputy President Leary that sort of information was again. Again it certainly couldn't be regarded as inappropriate procedure at the level of these performance reviews. The clothing issue is dealt with at page 4. Should I assume that the Commission will sit on till 1 o'clock, your Honours, or is it better to leave the detail - - -

PN906

JUSTICE GIUDICE: How long will you be with these documents?

PN907

MR BUCHANAN: With this particular one I will probably be finished by 1 o'clock, your Honour. There are a number more to go to.

PN908

JUSTICE GIUDICE: Yes. Well, I think we might adjourn now till 2.15.

LUNCHEON ADJOURNMENT [12.51pm]

RESUMED [2.19pm]

PN909

JUSTICE GIUDICE: Thanks, Mr Buchanan.

PN910

MR BUCHANAN: Thank you, your Honour. I've asked the Commission to go to the document which was annexure RD21 to exhibit MTO8. I had referred very briefly to page 3 of that letter. May I just remind the Commission that this was another area in which Mr Shannon had received an unacceptable rating. It does not appear to be the subject of particular findings by her Honour. She concentrated on the issues which are identified in paragraphs 87 and 88 of the decision. Those matters are dealt with at page 4 and this is what Mr Davies said to Mr Shannon about them:

PN911

I note that you agree that you did state that you had not received your clothing issue for 2 years. This issue arose in the context of a presentation I gave to the crew about the enterprise agreement ...(reads)... This has not occurred during this review and accordingly there is no justification for any increase to your rating for this dimension.

PN912

Now this covers the very sort of things about which evidence was given but it is as clear as crystal that Mr Shannon had an opportunity, prior to the selection for retention interviews to deal with these sorts of issues and that he did so and that there was a considered response to his representations about it. It simply cannot be said that there was lacking any opportunity to deal with the matter and with respect to Her Honour, her finding at paragraph 91, that she prefers his evidence, is not relevant to any matter that she had to decide. There may well be differing views about the issues. Mr Shannon may have felt, notwithstanding the response to him, that his position should be accepted and not that of Mr Davies, but that is not the point. It wasn't necessary to resolve this issue for the purpose of the case, it was well removed from the substance of the issues.

PN913

It is quite impossible to conclude that favouring Mr Shannon's view on this one limited matter, had any bearing on whether overall, he should have been preferred for retention in employment. It will be remembered for the balance of his assessment, he had argued that he should receive higher ratings than, in fact, he had received and notwithstanding his representations, none of those ratings were changed. There is no reason to think that the assessment of those matters was made in a way which was different to the assessment of rating for any other employee.

PN914

The finding that was made, and this is the very worst example. The finding that is made at paragraph 91 of the first decision is a response, of course, to the way in which the applicant's case was run but it is a complete red herring. It really doesn't come to grips with the issues which, if there were any available, were available in the settings of this kind. The next one was Mr Taylor in paragraph 92. Her Honour says: "Mr Davies reviewed - - -

PN915

JUSTICE GIUDICE: Mr Buchanan, in '91 presumably Mr Davies gave evidence about this document you have been taking us to.

PN916

MR BUCHANAN: Yes.

PN917

JUSTICE GIUDICE: Ninety-one seems to involve a finding as to - or as between the evidence of the two, Mr Shannon and Mr Davies.

PN918

MR BUCHANAN: Your Honour, it would appear upon Her Honour's conclusions in paragraph 88, where Her Honour seems to think there is no rebuttal but, of course, that is not right.

PN919

JUSTICE GIUDICE: She doesn't in terms, deal with Mr Davies's evidence at all, does she?

PN920

MR BUCHANAN: No.

PN921

JUSTICE GIUDICE: No. I see.

PN922

MR BUCHANAN: No, but suggesting there is no rebuttal, she says:

PN923

The alleged reasons, taking the evidence on face value ...

PN924

That is, taking Mr Shannon's version only and to be absent of any rebuttal, the alleged reasons are best petty and at worst unproven and contrived. With the greatest of respect, it is a very unsatisfactory assessment of the whole of the position with respect to this issue and it misses the point completely, if, as she was doing, she is concentrating on opportunities of response because there was an opportunity of response and the response was considered and dealt with in detail.

PN925

JUSTICE GIUDICE: But the statement there that, "in the absence of any rebuttal"; the document you have taken us to was in Mr Davies's witness statement?

PN926

MR BUCHANAN: Yes.

PN927

JUSTICE GIUDICE: And he gave oral evidence?

PN928

MR BUCHANAN: Yes.

PN929

JUSTICE GIUDICE: Was he cross-examined about this issue?

PN930

MR BUCHANAN: Yes, I believe so, your Honour. Would you like me to check that?

PN931

JUSTICE GIUDICE: Yes. So there was a rebuttal?

PN932

MR BUCHANAN: Yes. Yes, this seems to turn entirely on the fact that Mr Hammond, who was claimed by Mr Shannon to support his version of an incident which was earlier than a review period. The first-aid incident, so called, wasn't the subject of an appraisal, although it was said to be indicative of an emerging pattern of behaviour. So we go, even earlier than the review period. The fact that Mr Hammond is not called, apparently is the basis for Her Honour saying: look, there is no rebuttal of Mr Shannon's evidence.

PN933

JUSTICE GIUDICE: Yes.

PN934

SENIOR DEPUTY PRESIDENT MARSH: Well where does paragraph 90, where does that take us?

PN935

MR BUCHANAN: This is a different issue altogether.

PN936

SENIOR DEPUTY PRESIDENT MARSH: Is it?

PN937

MR BUCHANAN: Mr Lewis, who is a supervisor, is alleged to have said to Mr Shannon - and I think it was suggested that Mr Lewis had, in fact, in an earlier draft suggested a rating of "exceeds expectations" and in the end, that became "an unacceptable" and one of them - the one that I said didn't receive any particular attention, the one for "occasionally being rude and abrupt in ..... room meetings".

PN938

SENIOR DEPUTY PRESIDENT MARSH: Yes.

PN939

MR BUCHANAN: We have dealt with this to some extent in the reply. In this area, Mr Davies spoke with - it might be better if we go back to the document at page 4. I had started onto the heading: Clothing Issue; but if you go up to the heading: Dimension 2.2, there were certain things set out. "You commented in relation to the first-aid issue and clothing issue. In support of a rating of excellent, you state that you:" and there were a number of points given. I think the suggestion in the evidence was that Mr Lewis thought that in these areas Mr Shannon exceeds expectations but after discussion with two other supervisors, Mr Lewis had concurred in a lower assessment but in these areas you will see that what Mr Davies says:

PN940

If the examples you provide to illustrate that you provide appropriately timed, detailed and accurate information. This is consistent with immense expectation rating as it is a performance that is expected of every tradesman.

PN941

So to that extent, Mr Shannon's position is accepted as meeting expectations. Then it goes on:

PN942

However, there are elements of your behaviour which are clearly unacceptable and that is why you have been rated unacceptable.

PN943

The quantum leap that Her Honour refers to is actually constituted by two things. One is the statement that: accepting everything you have said, that meets expectations, but it is what we expect of everybody and so something higher is not required; and: the things that bring you down to one acceptable are these other issues, which he then goes on to deal with. It is not really a quantum leap at all, of course, it is a reasoned, responsible, considered response to Mr Shannon's position.

PN944

SENIOR DEPUTY PRESIDENT MARSH: So the evidence before Her Honour with respect to rebuttal of Mr Shannon's evidence is what you have just taken us to?

PN945

MR BUCHANAN: No, well no, that is - - -

PN946

SENIOR DEPUTY PRESIDENT MARSH: No?

PN947

MR BUCHANAN: There was more. There was sworn evidence by Mr Davies. What I've taken the Commission - - -

PN948

SENIOR DEPUTY PRESIDENT MARSH: I'm just been looking at it, Her Honour says it was unchallenged evidence. So are you not agreeing with that?

PN949

MR BUCHANAN: No, I don't, your Honour. What I have taken the Commission to, because I thought it was the most efficient way of doing it, was to go to the material that demonstrates explicitly that there was an opportunity during the performance appraisal process itself, which pre-dated the selection for retention, to deal with the very issues that Her Honour makes findings about. Because these are the things later that Her Honour gathers together and says: well, these are the reasons why paragraph C is not satisfied. But paragraph C was satisfied and it was satisfied at a point in time well before the retrenchments occurred.

PN950

Now Mr Taylor - and we have dealt with all of this in a bit more detail in the submissions in reply and it was dealt with in even more detail in the written submissions before Her Honour towards the end of them, if the Commission finds it necessary to go to that where more detailed references of the evidence are given. For Mr Taylor, Her Honour said:

PN951

Mr Davies reviewed the PR1 idea for Mr Taylor and responded by advising that Mr Taylor had not raised any specific disagreement about his assessment, so no ...(reads)... selection process and they had not been successful. No evidence was presented to challenge Mr Taylor's testimony.

PN952

Now the document for Mr Taylor - this is going back to the appraisal process again, which was in evidence before Her Honour, is in RD42 behind tab 5 and again it is towards the end of the bundle. Sorry, RD41 is actually Mr Taylor's document. RD42 is the team leader's response and you will see, for example, with respect to rating 3.1, that the team leader agrees that there should be an increase from "does not meet" to "meets expectations". And the changes resisted in the other respects which were to go from "meets expectations" to "exceeds expectations".

PN953

The letter to Mr Taylor is RD44, it is dated 21 September 1999 and in accordance with the team leader's response, the one "does not meet expectations" goes up to "meets expectations" and so that was the overall result. Now there is no lack of opportunity here, there is no disregard of his position, there is no disregard of his representations. On the contrary, in this case, as it happens, there was an acceptance, certainly of the one area in which he fell below the standard of "meets expectations".

PN954

Mr McKechnie was dealt with by Her Honour from paragraph 94. She says:

PN955

Mr McKechnie argued that his assessment was unfair as the person doing his assessment would not be familiar with his work and was unable to provide any indication ...(reads)... refused, he challenged his assessments in a number of areas. No evidence was brought by MTO to refute his claims. Once again I prefer the evidence of the applicant.

PN956

The letters that deal with this are in volume 1 of the indices, MTO 8 annexure RD82. Volume 1 behind tab 2, RD62 which is towards the end of the document it is also a letter dated 21 September 1999. It is seven-and-a-half pages long. Mr McKechnie challenged each of his assessments, each of his ratings and Mr Davies says to him - sorry, have the Members of the Commission managed to find this?

PN957

SENIOR DEPUTY PRESIDENT MARSH: No, I haven't.

PN958

MR BUCHANAN: Sorry, your Honour. It is in volume 1 of the - - -

PN959

JUSTICE GIUDICE: It is the last document, I think, before tab 3.

PN960

SENIOR DEPUTY PRESIDENT MARSH: Yes, I've found it.

PN961

MR BUCHANAN: Yes, I think that is right, your Honour. Shortly before tab 3. It is an entirely typewritten document. Mr Davies says:

PN962

Dear Ross, You have recently lodged a resolution of disagreement form after your performance ...(reads)... A copy of your form is enclosed. I have addressed each response separately after consultation with your team leader.

PN963

For present purposes I think it would be sufficient to go forward to page 6. This being the one that deals with the so called "one off" incident. We dealt in the submissions in reply with some of his other claims and given some more references but this is the "one- off" incident. Four point one in the middle of page 6:

PN964

This dimension looks at whether you haven't used your experience and knowledge to do the job. You received a "does not meet expectations" rating for this ...(reads)... that unusual actions or processes have on the equipment under your control. There are no established examples of such behaviour. I believe your ..... is true and accurate for this dimension.

PN965

Now it can be seen that it deals with the issue in two parts. It deals with the "does not meet expectations" rating, rather than the "meets expectations". It tells Mr McKechnie that this is not a "one-off" incident. It is reflective of a lack of consistency. It makes a specific suggestion to him about how his work could be improved in this regard, namely by doing final checks on work. And then there is separately addressed, his claim to have "an exceeds expectation" rating and an explanation of why it is that he doesn't satisfy that standard. And again, with respect to Her Honour, the conclusion that she reached was unavailable and its use in any suggestion that Mr McKechnie had no opportunity to deal with these sorts of issues is quite misplaced.

PN966

JUSTICE GIUDICE: Well, the conclusion she expresses is at the end of paragraph 94 - "Nor was he given any" -

PN967

He testified: None of the issues raised in the light of ..... assessments were brought to his attention, nor was he given any indication of what he should do to improve his work performance.

PN968

MR BUCHANAN: That might have been what he testified but on a consideration of the whole of the evidence, such a suggestion could not have been accepted.

PN969

JUSTICE GIUDICE: Yes, but the significance of it, at least for me, is that she says she preferred his evidence, which seems to suggest that she accepted what she has set out there.

PN970

MR BUCHANAN: Well beyond somebody saying this letter had never been sent and he had never received it, it is just not available and if I need to refer to a statement of the relevant principle, then one would normally go to a case like SRA v Earthline. Because you cannot prefer a version of events given by one person over another version of events without paying regard to the whole of the evidence, especially the documentary evidence. It just cannot be done. Here is a letter that was part of the process, part of the PR2 process, which was a response to his appeal - his appeal in which he had said - let me go back and find it. In which he had said in respect of 4.1:

PN971

Why do you disagree with this rating. It was a one-off event while working on brakes with no brake skills.

PN972

I mean this was a process of consideration which he had initiated and he got an answer and, with respect, a conclusion no matter how it was expressed with a preference of his evidence over evidence that wasn't called or anything else, the conclusion was not available, that the matters relied upon were not brought to his attention nor was he given any indication of what he should do to improve his work performance.

PN973

JUSTICE GIUDICE: Was there some issue before the Deputy President as to the adequacy of evidence that was produced by way of letter, rather than - looking at the end of '95, Her Honour says:

PN974

No evidence was brought by MTO to refute his claims.

PN975

MR BUCHANAN: Yes, but what her Honour is referring to here are the sorts of things that she refers to a little earlier in the paragraph. Mr Ray wasn't called to give any evidence, Mr McKechnie says: "Mr Ray wouldn't have been familiar with his work. Mr Ray was not called to give evidence". And in Mr Shannon's case, Mr Shannon claimed that Mr Lewis or Mr Hammond, as the case may be, supported his version of events - they weren't called to deny it.

PN976

JUSTICE GIUDICE: I see, so is it possible that the last sentence of 95 is simply referring to the matters dealt with earlier in 95 and not 94.

PN977

MR BUCHANAN: There is another more general paragraph which I will try and find. When Her Honour says:

PN978

No evidence was brought by MTO to refute his claims.

PN979

That can't refer to these letters because all of this was in evidence. It was attached to Mr Davies affidavit.

PN980

JUSTICE GIUDICE: Yes.

PN981

MR BUCHANAN: These are all annexures, the affidavits.

PN982

JUSTICE GIUDICE: And presumably with the subject of cross-examination.

PN983

MR BUCHANAN: Yes, I think there was quite a deal of cross-examination about many of those issues, your Honour. But there is a more general paragraph earlier in the decision. Paragraph 23 and 24, where her Honour says, we submit mistakenly, for reasons that I will try and ..... a little bit more in a moment. She says:

PN984

The evidence about which the applicant's complain relate to a number of comments and opinions found in the statement of MTO witnesses.

PN985

I should go back to 21. The applicants raised objections to some of the MTO evidence being accepted and if it was accepted what weight should be placed upon it. To that end a general submission was provided on hearsay evidence and was responded to by MTO. The applicants attached extracts and the MTO witness statements which they submitted should be rejected. Then 23, her Honour goes on:

PN986

Those comments are generally in response to claims or allegations made by the applicants and suggest the MTO witnesses in question were spoken to the person about whom an applicant has made a claim or allegation and that that person has either denied such claim or allegation or cannot recall the issue or incident.

PN987

PN988

Let me pause there, this arises in this way, one of the applicants says, so and so said such and such. That is hearsay of course. The MTO witnesses say: well, I've spoken to the same person and he denies it and the employer refrains from making a further contribution to a long and extended process of evidence backwards and forwards about matters which, in our submission, were quite beside the point and irrelevant. Now, in those circumstances her Honour goes on to say:

PN989

Unless there is any direct evidence from those MTO managers rejecting or challenging the claims or allegations of the applicants, if the sworn evidence of the applicants were irrelevant it is preferred to any hearsay.

PN990

PN991

Well, that is a terrible double standard, because the sworn evidence that her Honour is referring to is hearsay evidence. Then she goes on to refer to extract something from what was said by MTO about this and then her Honour says:

PN992

That is the approach I've adopted. I have preferred any direct evidence where there is a contradiction. MTO was able to bring any evidence it wished to rebut the allegations and claims of the applicants but did not do so. I note that none of the appraisers, those responsible for the assessments and the direct application of the PRS, provided any sworn evidence. Those MTO managers that did provide sworn evidence were not directly involved with the process or the applicant could testify that they accepted almost unchallenged the assessments made by the appraisers.

PN993

PN994

MTO called the people that dealt with the appeals the people who were responsible for making the final decision. The people that were responsible for considering the representations made by the applicants. The people whose evidence would be most directly relevant to any suggestion that there was a lack of opportunity for the applicants to ventilate their complaints or have a fair hearing in relation to them. These were the areas in which ultimately all of this evidence was used to find unfairness, namely that there had been a lack of opportunity.

PN995

SENIOR DEPUTY PRESIDENT MARSH: So would Mr McKechnie's evidence as set out by her Honour in paragraph 95, that would be an example of the hearsay evidence that you say was the nature of the employees' witnesses.

PN996

MR BUCHANAN: Yes, and what was said about Mr Shannon in paragraph 88, Mr Hammond was not called to refute the evidence of Mr Shannon.

PN997

SENIOR DEPUTY PRESIDENT MARSH: I see it, yes. So read in conjunction with paragraph 23 that is the examples of the basis upon which you say it is a double standard?

PN998

MR BUCHANAN: Yes, and her Honour returns to it a little later in paragraph 131. She is now dealing directly with the application of the system and she says in the third line:

PN999

MTO had not countered those allegations with any sworn evidence. Each of the applicants has raised concerns about the alleged unfairness of the application of the system. MTO has not been able to refute much of that evidence.

PN1000

PN1001

And we pointed out in the initial written submissions that allegations are just allegations. People can say I believe the system is unfair but that does not make it the fact. What one has to do is to have a look at objective material and of course if it in the record at a time before the proceedings have commenced then it is likely to be given or should be given an appropriate weight.

PN1002

Here there was a documented resolution of these disagreements which went in detail to the very matters that the applicant subsequently ventilated when they came before her Honour, and her ultimate conclusion was, they had no opportunity to deal with these matters whereas the most cursory reference to the relevant material undistracted by the way in which the cases were run should have satisfied her Honour that every opportunity was given. The applicants may not have liked the outcome, but that wasn't the issue.

PN1003

Now, a fuller explanation of these things is contained in the affidavits of Mr Davies and Mr Gageler, exhibits MTO8 and MTO7, in the proceedings and just to give an example so the Commission would know where to find this if it decided it should look for it. In Mr Davies affidavit, MTO8 for example, commencing at paragraph 87, he sets out his response to Mr Shannon's statement in the proceedings in considerable detail. The reason that I'm not concentrating on the exchange at the point of the proceedings is because in one sense it is not necessary to go behind what happened at the time of the performance appraisals.

PN1004

The lack of opportunity which her Honour found was constituted by the fact that there was no opportunity to deal with criticisms arising out of the performance appraisal system, but there were opportunities given at a number of points in time. One was immediately upon the appraisals being made, another one was at the time of selection for retention interviews. Nothing about this case permitted her Honour to put the history of the matter to one side and, in effect, to say: this all has to be ventilated before me and I will decide who was right and who was wrong. That is not the issue that is raised by paragraph (c) if an issue is raised by paragraph (c).

PN1005

Now, I'm going to show her Honour draws all this together in a short while. I just need to touch on the position of the remaining two applicants. Mr Selby is referred to at paragraph 96:

PN1006

Mr Selby complained that he had been on light duties and absent for some time on workers compensation during the period of the PRS and SR assessments. He said that his rating was unfair and based on a limited view of his performance generally.

PN1007

Then there is reference to Mr Keag's evidence. He agreed that neither he nor Mr Gageler were familiar with the work of Mr Selby, couldn't recall either superintendents saying they had seen Mr Selby at work. He was examined at length about the assessments. He said he was unaware that he was on a rehabilitation program and missed many days at work during the assessment period. Mr Keag's evidence of the review panel, that is at the selection process, did not investigate the RDF logs by Mr Selby in the review process.

PN1008

Mr Selby raised the fact that he has been assessed on work he had not performed in the period under review. It would seem therefore that the final assessment for Mr Selby, approved by Mr Keag and Mr Gageler, may be inaccurate and his claims inaccuracy should have been discovered in the review process. Mr Selby argued that claims that he - acceptable time keeping were incorrect, and if such was the case he had never been warned or counselled about it. The relevant document for Mr Selby was attached to MTO7, it is GG19, it is in volume 1. I need to find firstly GG14 which is the resolution of this agreement form.

PN1009

The one I need to take the Commission to is GG19 which is the second one, this is the one most recent in time or closest to the retrenchments. Now, Mr Selby was rated: not meets expectations in four areas, and ultimately the team leader supported an upgrade in one. In this form you will see on the second page:

PN1010

The rating given: does not meet expectations, a rating you think should have received: meets expectations. Why do you disagree with this rating? I have been on light duties for 3 months. I have only been back full time for 3 weeks. I believe that I have been judged harshly by my team leader and not been given a fair go.

PN1011

PN1012

Then if one goes forward to the response to him, which is GG21, the third paragraph - I'm sorry, the second paragraph sets out his complaint the one I have just read and the third paragraph says:

PN1013

I have discussed this issue with your superintendent and I have concluded that he has not rated you harshly because you were on light duties during the rating period. In completing your performance appraisal your superintendent has consulted with Steve Wiley, Warren Barry and Anthony Eccelston. During the review period the duties upon which you were assessed included the duties described in your return-to-work program and your performance during the review period when you were on normal duties.

PN1014

PN1015

Then more detailed discussion follows. In addition to the upgrade supported by the supervisor, two more rating were increased so that Mr Selby received three rating increases out of four. it is very difficult to know how this could possibly be construed as unresponsive or a lack of opportunity or a failure to take in to account that he had been on light duties or anything of the kind. The only way one gets to something like this is by completing ignoring this sort of material and being diverted in the assessment of a case simply by the allegations that were made in the case before the Commission.

PN1016

JUSTICE GIUDICE: I will just ask you about paragraph 97?

PN1017

MR BUCHANAN: Yes, your Honour.

PN1018

JUSTICE GIUDICE: Mr Keag's evidence that the review panel did not investigate the RDF lodged by Mr Selby in the review process was that - - -

PN1019

MR BUCHANAN: That is the - - -

PN1020

JUSTICE GIUDICE: - - - earlier was it?

PN1021

MR BUCHANAN: No, that is the panel that selected employees were retrenched on.

PN1022

JUSTICE GIUDICE: I see.

PN1023

MR BUCHANAN: And that appears to relate to the fact that they didn't go back and, as it were, re do it.

PN1024

JUSTICE GIUDICE: So the one that we are looking at which is GG21.

PN1025

MR BUCHANAN: Yes.

PN1026

JUSTICE GIUDICE: Was the second round of performance reviews, was it?

PN1027

MR BUCHANAN: Yes.

PN1028

JUSTICE GIUDICE: The second out of the three if you like. There were two performance reviews then a selection - - -

PN1029

MR BUCHANAN: Then the selection process.

PN1030

JUSTICE GIUDICE: - - - process.

PN1031

MR BUCHANAN: Yes. The last one was Mr Tanks and her Honour says about Mr Tanks, paragraph 99:

PN1032

Mr Tanks testified that his PRS was unfair. He said appraisers would not have been in a position to properly assess his performance. He said, "I raised ...(reads)... have access to the supervisor who had input so I could discuss the assessment." He said, "This is not possible." Mr Hendricks was not called to respond to Mr Tanks evidence.

PN1033

PN1034

Then there is another allegation about Mr Hendricks and then at paragraph 101:

PN1035

Mr Tanks said he didn't submit an RDF PR1. He said it was like a school report card.

PN1036

Paragraph 102:

PN1037

In his PR2 RDF, Mr Tanks raised a number of concerns and challenged the comments and allegations therein. He said he also asked in his interview how his appraisers were able to assess his performance when the had very limited opportunity to observe his work. He was advised that his appraisers had conferred with other supervisors though he was not told who those supervisors were so he was unable to ascertain what in fact was said about his work performance.

PN1038

Mr Gageler discussed the issues raised by Mr Tanks with his, Tanks' supervisors and superintendent, having considered the information provided Mr Gageler improved one rating as a result of Mr Tanks' PR2 RDF, and that is in MTO7, GG40, which is also in volume 1 behind tab 3 and it is reasonably close to the end of the bundle. Mr Tanks challenged five assessments. Two of them were: do not meet expectations, does not meet expectations, and three of them were: meets expectations.

PN1039

At page 1, under dimension 1.1:

PN1040

You have appealed this dimension on the basis: it does not meet expectations, is not appropriate, and you should have been rated as: exceeds expectations ...(reads)... I consider these examples clearly below expectations and as such I concur with your supervisor's rating.

PN1041

PN1042

Page 2, dimension 2.2, this was the other one: does not meet expectations:

PN1043

This dimension looks at how employees give information, ideas and feedback. You state that your rating should be increased from: does not meet ..reads... a high rating is not justified. Accordingly, your rating will be changed from: it does not need expectations, to meets expectations.

PN1044

And at the end of this, at page 4, under the heading: General comments, this was said:

PN1045

At the end of your response, you say, that the team leader ..... had put into your appraisal of not spent much time with you over the review period. Although the nature ...(reads)... made a thorough assessment of your abilities to be determined and a fair rating to be recorded on your appraisal.

PN1046

Now, again, there obviously was an opportunity to raise, in connection with the performance appraisals, the very matters that were ventilated before her Honour. The opportunity was taken, the representations were considered and they were responded to and they achieved a measure of success. Her Honour draws all this together at paragraph 112, where she says:

PN1047

The applicants relied on a number of allegations about the unfairness of the process. There was no direct evidence to refute many of those allegations.

PN1048

As well, allegations about performances she was ..... challenged and it would seem, in some instances, the first knowledge the applicants of these alleged incidents were as a result of these proceedings. Then, that does not appear to be the case with any of the matters that I've taken the Commission to. Then, in paragraph 131, she says:

PN1049

To apply a fairness test it is necessary to consider the evidence, particularly the sworn evidence, where applicants have made quite serious allegations about ...(reads)... not been given an opportunity to respond for the reasons for their selection, or if they have provided a response it has been disregarded.

PN1050

Now, if those statements are intended to refer to the matters that are her Honour dealt with earlier, that is the performance reviews, then both statements, with respect, to her Honour are quite wrong. I might point out initially that none of them were selected for retrenchment. They were part of a group of people who were not selected to be retained in the business. More importantly, for present purposes, at the time that the performance appraisals were conducted there was every opportunity to take up issues of concern or disagreement. The opportunities were used and the matters that were raised were dealt with, some times favourably to the applicants. They certainly weren't disregarded, as her Honour seems to suggest.

PN1051

There was a very different case, or very different circumstances in the case that I referred to this morning, Manuel v Pasminco Copper Creek Smelter, where no opportunity was in fact given to deal with the sorts of issues that were relied upon. Even there, of course, that didn't provide a basis for reinstatement. It is, with respect, not the Commission's function to stand in the shoes of the employer and decide whether people should be retrenched, whether there should be redundancies, and if so who it would be. It must be necessary to find, in all the circumstances, that the termination of employment was unjustified. The test is not satisfied by picking out a few grievances and thrashing them to death in proceedings before a member of the Commission, nor is an employer bound to get caught up in such an exercise and call a long line of supervisors to answer a whole string of positively irrelevant allegations just because an applicant wants to run a case along those lines.

PN1052

The criticisms in this case of the employer, the observations about heresy and the lack of quality in the employer case, for that reason were, with respect, completely unjustified and none of that was relevant to paragraph (c) or paragraph (d), which deal with opportunity and which represent the only area in which her Honour gathered together the nearly critical findings. In that context, reading the decision as one must in the context which her Honour sets, the criticisms that try a lack of appreciation of the proper focus of the case and they illustrate clearly that the case entered the wrong areas of investigation. I mentioned before lunch that there was no suggestion in this case of inconsistency. No suggestion that the applicants were treated more harshly in the assessment of their performance than were all the other employees, or that the standards which were set and which were explained in the letters that I've gone to were applied differently.

PN1053

Of course, any such suggestion would have been a little difficult for the applicants because it would have been immediately contradictory of the premise that they were somehow representative to say that they were treated differently from the balance of the employees retrenched. Now, if it is necessary to go to the material that describes the history of the development of the performance appraisal systems; the checks and balances which were incorporated; the processes for validation which were incorporated; the fact that it was all based on external advice, coupled with internal consideration, that history is set out in the affidavit of Mr Keag, K-e-a-g, in the proceedings. He also described the development of the selection for retention process. But, of course, her Honour does not make any finding that the systems were unfair.

PN1054

We included in the written submission something that I want to go back to just for a moment. From about page 55 we set out some extracts which explain what happened at the time when the selection for retrenchment interviews and decisions were being - interviews were taking place and decisions being made. This is the point of which the focus of attention should really have been placed. It is a point of a case that really seems to have been largely ignored by the applicants who preferred to run their case by reference to challenges to earlier assessments and earlier processes.

PN1055

I'm not going to read all this, but Mr Davies for example, commencing at page 55, sets out the various steps that were taken. The painstaking way in which a progressive selection was made of those to be retained in the business and the way in which it was done. Mr Gageler - this was in the maintenance area for the mechanical and electrical tradesmen - Mr Gageler deals with a similar selection process in the mining area. The progressive and narrowing selection of employees to be retained in the business - he said the process took about 3 hours - this of course is after all of the interviews have been conducted.

PN1056

It will be remembered and we point out again in the submission dealing with the selection for retrenchment interviews themselves, from paragraph 154 that employees were told how the interview would go. They were - this is at the top of page 53:

PN1057

They would be asked to talk about any significant contribution they have made since PRS2 ...(reads)... to ask any relevant questions.

PN1058

There was a specific question that was asked of them and they gave a series of responses to that question, which we have made some short submissions about. Going back to page - to Mr Harding's evidence from page 56 onwards - Mr Harding gave evidence about the way in which he responded to the recommendations made to him. For example, at the paragraph numbered 164, he said:

PN1059

After Graham Gageler finished his explanation I asked whether the panels had any concerns about the process ...(reads)... panels were comfortable with their decision.

PN1060

From 166, he deals with something that we are not concerned with in these proceedings. At 173 he comes to deal with the maintenance panels. At 176 after setting out the process he says:

PN1061

I then asked Rob.

PN1062

That is Mr Davies:

PN1063

I then asked Rob if there were any areas of concern. He said that the panels believe that the process ...(reads)... but I accepted their recommendations.

PN1064

Now, it is not possible in the circumstances of this case to suggest that there has been any conclusion which, nor was any available, that the people that stayed were the wrong people to stay, and the people that went were in any respect the wrong people to be made redundant. There is a statutory direction upon the Commission these days to ensure that there is a fair go all round. How one might ask in the circumstances of a case, such as the present, could that direction be met so far as those employees who were retained in the business are concerned. What attention is given to their circumstances and their entitlements and their expectations? Is it seriously now to be suggested that they should compete again for their own jobs and what about the other 77? Are the first five who were picked by the CFMEU going to get first crack at any available work in competition with the existing employees?

PN1065

How do you adequately and fairly deal with the circumstances of the remaining 77, who have been put to one side upon the basis of an unsustainable premise, namely, that they would somehow be represented in their endeavours, or in their cause by the first five applicants. If that was the way in which the case was going to be approached, then one might have expected there to be, not a concentration upon the particular complaints of the individual applicants, but rather an endeavour to show something rather more fundamental in error about the system. Drawing all that together, our submission is that the very foundation for the finding in this case that the terminations were in each case harsh, unjust and unreasonable, is unsustainable.

PN1066

The concentration on procedure, the failure to bring into account matters of substance, like the validity and character of the reason, the absence of any substantive basis on which to conclude that the applicants should not have been the ones to be retrenched, all act in combination to illustrate and confirm the error in the finding at paragraph 132 and the one which immediately follows it:

PN1067

I find therefore that the termination of employment by redundancy of the five applicants was harsh, unjust and unreasonable.

PN1068

This was not a discretionary decision, but it wouldn't matter if it was. Applying any test to the identification of error, our submission is, that error is clearly demonstrated with respect to that primary finding and it should be set aside and it really should be substituted instead to the conclusion that the applicants had failed to demonstrate that the termination of any of them was harsh, unjust, or unreasonable.

PN1069

Now, if we succeed to that point I suppose, strictly, it is unnecessary to deal with the question of remedy, but of course I need to go to that for the moment. If we are at this point, then, it seems to follow that we would have lost on what I have been arguing so far and that the Commission would allow to stand some conclusion, even if differently expressed, that the terminations were harsh, unjust, or unreasonable.

PN1070

JUSTICE GIUDICE: I think it is submitted by the respondents that even if your submissions are right as to alleged errors in the way in which the matter was dealt with - or the analysis, if you like, that appears in the decision.

PN1071

MR BUCHANAN: Yes.

PN1072

JUSTICE GIUDICE: That nevertheless there were other bases upon which her Honour could have found - should have found perhaps that the terminations were harsh, unjust, or unreasonable.

PN1073

MR BUCHANAN: Yes.

PN1074

JUSTICE GIUDICE: I think that submission is certainly contained there and for that reason a number of other submissions appear to be put that don't directly go - I'm not misrepresenting the position - but which don't directly go to justifying the decision as made.

PN1075

MR BUCHANAN: Yes.

PN1076

JUSTICE GIUDICE: But if you like put independent reasons, so it may be we will have to grapple with that if we - - -

PN1077

MR BUCHANAN: Perhaps. I must say the focus of our attention is on the decision and the reason for the decision.

PN1078

JUSTICE GIUDICE: Yes, yes, I understand that.

PN1079

MR BUCHANAN: There were a series of other things that her Honour rejected and we say, rightly. Ultimately, the whole focus of her attention appears to have been upon this idea of procedural fairness, or lack of opportunity. I know she makes some comments about some subsidiary matters that she says were relevant. She does not quite say how they were relevant and she deals with them after she has announced her conclusion, but none of them relate to things like bias or discrimination, or things of that kind. I don't know whether this bench will be asked to canvass all of those matters again upon some footing that as an alternative it would be open to rely upon those matters, even if the primary conclusions fell away.

PN1080

JUSTICE GIUDICE: Yes, well, I just mention it.

PN1081

MR BUCHANAN: That exercise is - - -

PN1082

JUSTICE GIUDICE: It is a submission that is I think before us.

PN1083

MR BUCHANAN: Yes, if that exercise were ever in prospect, your Honour, then we would hope that we might have an opportunity to think about that in the light of what was said about our submissions. Let me try and get that a bit more focussed. If for example the Commission said that: the reasons given were an inadequate foundation for the conclusion, but that fairness demanded that there be further consideration of alternative bases now relied upon by the respondents which have been rejected by her Honour, that would open up the prospect of some sort of a re-run. Our submission is, it is not necessary and wouldn't be appropriate, but perhaps that is getting a little bit ahead at the moment.

PN1084

JUSTICE GIUDICE: I'm not doing anything other than drawing attention to what I thought was part of the written submissions that have been filed.

PN1085

MR BUCHANAN: Yes.

PN1086

JUSTICE GIUDICE: I might be wrong in that respect.

PN1087

MR CRAWSHAW: I thought this was the re-run.

PN1088

JUSTICE GIUDICE: I don't know if there is going to be a chapter 2 on any view of it, or chapter 3, or whatever chapter we are up to.

PN1089

MR CRAWSHAW: Yes. Well, unfortunately, there is no facility for something like a cross-appeal, or formal notice of contention, or something of that kind and it is not an area in which we could be thought to bear any onus.

PN1090

JUSTICE GIUDICE: No, just the submissions are there, Mr Buchanan, that is all, I'm not doing anything other than pointing to them.

PN1091

MR BUCHANAN: Yes. Well, if it becomes necessary, no doubt, the Commission will give some attention to whether we have had - could be regarded as having a reasonable opportunity to deal with them - we haven't. We prefer to concentrate on this appeal, rather than some other case and that is what it will be, another case. Your Honour, let me assume that for one reason or another for the moment there is a finding that the terminations were harsh, unjust, or unreasonable and the Commission had to give its attention to the question of whether a remedy should be granted and, if so, what sort of a remedy.

PN1092

The position at this level becomes even more seriously compounded, we submit, with respect that it can't be regarded as appropriate to reinstate someone, knowing it will generate a further retrenchment, but indifferent to that fact, or even who it would be, and to do it without any consideration of the other 77 people. The answer appears to be that it seems assumed and accepted that it will be the applicants who are retrenched again and in pretty short order. Now, if that is right, then the order of reinstatement serves no legitimate purpose and could not in our submission be regarded as appropriate. For all her Honour knew on the approach that she had taken in this case, she would find some such procedural error in any future case that was run, and on the approach that she took, would feel obliged to reinstate such persons also.

PN1093

The reason I make that submission is because of the automatic way in which the findings appear to follow one upon the other, without any further particular consideration, so that in paragraph 132 her Honour says:

PN1094

Accordingly, I find the provisions of C and D have not been satisfied.

PN1095

In 133, she says:

PN1096

I find therefore that the termination was harsh, unjust and unreasonable.

PN1097

In the second decision in paragraph 38 she says:

PN1098

Having found that the termination of the five applicants was harsh, unjust and unreasonable, I propose to make orders to provide a remedy.

PN1099

In paragraph 50 she says:

PN1100

MTO may disagree and obviously does disagree with the findings I have made, they have that right ...(reads)... is for reinstatement to be ordered.

PN1101

So that those things appear to follow, one upon the other, almost as night follows day, and the fact that the terminations occurred pursuant to a legitimate process of work-force reduction, appears to have been treated in the case as irrelevant - as some sort of procedural inconvenience. The fact that each of the retrenched employees received a severance package which had its origins in the certified agreement, also appears effectively to have been put out of contention. May I hand to the Commission, you will see it the same time as I do, a table that sets out the payments that were made, breaking the payments up into their respective elements, notice, redundancy severance, annual leave, long service leave, sick leave. Expressed as gross amounts and based upon a standard of 3 weeks for each year of service.

PN1102

JUSTICE GIUDICE: How do we get some indication of the relevant dimension of those payments? Is there information about salaries, or earnings, or something of that kind? Perhaps I should have asked that question earlier.

PN1103

MR BUCHANAN: The calculations are made on base salary. The gross salary for at least the first three applicants at the time was $798 a week, I am instructed.

PN1104

JUSTICE GIUDICE: For each of them?

PN1105

MR BUCHANAN: That is for the first three.

PN1106

JUSTICE GIUDICE: I'm sorry, the first three, yes, Shannon, Taylor and McKechnie.

PN1107

MR BUCHANAN: The others - they were in the trade areas - I think the others were in the mining area - we haven't got that immediately to hand, your Honour.

PN1108

JUSTICE GIUDICE: Well, is the notice payment in the second line, is that based on a number of weeks?

PN1109

MR BUCHANAN: Yes. We don't know the exact number, although no doubt a calculation could be done. If you divided, for example, a figure for Mr Shannon by $798, theoretically, you get a number of weeks. I hope that all works out.

PN1110

SENIOR DEPUTY PRESIDENT MARSH: Nine.

PN1111

JUSTICE GIUDICE: Well, they are not the same for the three.

PN1112

MR BUCHANAN: No, they are not.

PN1113

JUSTICE GIUDICE: But, anyway, they are pretty close. Yes, all right, thank you.

PN1114

MR CRAWSHAW: There is information about their salaries, or the previous salaries of the five applicants in the remedy appeal books. CMFMEU65, 66, 68 - 67, 68 and 72.

PN1115

JUSTICE GIUDICE: 65 to 68, did you say?

PN1116

MR CRAWSHAW: 65 to 68 and 72.

PN1117

JUSTICE GIUDICE: Thank you.

PN1118

MR CRAWSHAW: They are statements by each of the applicants.

PN1119

JUSTICE GIUDICE: Thanks.

PN1120

MR BUCHANAN: We are not sure whether the matters my learned friend has referred to represent earnings, as opposed to rates of salary.

PN1121

JUSTICE GIUDICE: Yes, well, earnings would be relevant as well, in getting an idea of what the payments represent.

PN1122

MR BUCHANAN: Yes, yes. This was an important issue, this question of severance pay was an important issue to take into account on the question of whether the terminations were harsh, unjust, or unreasonable. If one was looking at the overall circumstances or all the circumstances and it does not appear to have received any attention at all and the attention that it received at the time of the remedy hearing is quite illusory because if the redundancies are to re-occur as it appears assumed they will then the severance payments have got to be made in fact I was reminded this morning at even higher rates of pay perhaps than those applying originally.

PN1123

JUSTICE GIUDICE: Does the material disclose the total number of employees at Mount Thorley?

PN1124

MR BUCHANAN: Does your Honour mean at the time of the event.

PN1125

JUSTICE GIUDICE: Yes, at the time the exercise was conducted.

PN1126

MR BUCHANAN: There were 82 employees retrenched. I think we set out in our written submission, your Honour, some of the figures.

PN1127

JUSTICE GIUDICE: Yes, well we can find that at some other time then perhaps.

PN1128

MR CRAWSHAW: I think you will find that is also in the remedy appeal books Mr Sanders stated at appendix 2.

PN1129

JUSTICE GIUDICE: Thank you.

PN1130

MR BUCHANAN: If our challenge on the appeal fails the situation will be that what we've attempted to characterise as procedural flaws or procedural defects will have been sufficient to underpin the conclusion of the termination for harsh, unjust or unreasonable notwithstanding that there is no finding that any of the applicants should in fact have been retained in employment. That is an exercise that on the most charitable view of it remains to be done. In circumstances such as that in our submission it is not in accordance with principle to order reinstatement and to generate perhaps quite unnecessarily and on her Honour's assumptions certainly unnecessarily a further false competition for employment more than 2 years after the event.

PN1131

The principal approach in such a circumstance is to refuse any claim for reinstatement excepting that the disadvantages of retrenchment have been dealt with so far as they can be by the payment of severance pay and for similar reasons any claim for compensation should also be refused because so far as such matters can reasonably be anticipated and were anticipated by the parties a scale of severance payments was struck which was honoured at the time that they were retrenched. Now, we in the submissions referred to as a last resort as it were the possibility of nominal compensation.

PN1132

Nominal in that sense means nominal in the same sense as a peppercorn rent or nominal damages. That is some full acknowledgment of legal correctness in a technical sense accompanied by an exercise of discretion that emphasises that other than nominal compensation would not be appropriate. Now, your Honours, and, Mr Commissioner, those submissions have necessarily been illustrative of principles that we've argued more in more detail in the written submissions and the written submissions themselves do not descend into the sort of detail with which her Honour was favoured in submissions in the case at first instance.

PN1133

Of course we rely upon the written submissions in the appeal to the extent that it would be necessary to do so in respect of any issue of the kind that your Honour the President referred to a moment ago. There are submissions of course on all aspects of the case at first instance contained in the material in the appeal books and to the extent necessary to do so we would rely upon those. We would be happy to furnish such assistance as we can about where the most relevant parts of such submissions are to be found should it become necessary to do so. We haven't yet found the Western Australian case in the mining industry but we will continue to look and if something should emerge we will take steps to bring it to the Commission's attention.

PN1134

Subject to those matters they are the submissions that we put on the appeal, thank you, your Honour.

PN1135

JUSTICE GIUDICE: Thank you, Mr Buchanan. Mr Crawshaw, it might be as well to ask how long you think the stay proceeding might take.

PN1136

MR CRAWSHAW: I think I've already declared our hand. In terms of the arguable case aspect we have both put in written submissions and now my friend has actually finished his oral submissions we would be content to rely on our written submissions for the purpose of the stay on that aspect. On the other aspect in relation to evidence we would be referring you to those five statements that I just mentioned in the remedy proceedings that reveal the income. They also show the employment status of the applicants as at December which I'm instructed has not changed and apart from that we would be just asking that the same order be made as was made in the Hunter Valley proceedings by - - -

PN1137

JUSTICE GIUDICE: Which I think was payment of the amounts calculated between the time of termination and date of the order with some sort of surety or some kind of provision for repayment was it?

PN1138

MR CRAWSHAW: I think the back-pay was to go into an interest bearing deposit.

PN1139

JUSTICE GIUDICE: Was it? I see, I see.

PN1140

MR CRAWSHAW: And the employees were to get their pay from the date of the order onwards subject to giving undertakings and there were deductions for various matters including any money that they were earning in present jobs.

PN1141

JUSTICE GIUDICE: Yes. Well, in any event it might take - - -

PN1142

MR CRAWSHAW: But my learned friend is the applicant so - - -

PN1143

JUSTICE GIUDICE: Well, it may take more than a little while to deal with. I can indicate that we will sit as a Full Bench to deal with that.

PN1144

MR CRAWSHAW: Well, it might be convenient if that is done now.

PN1145

JUSTICE GIUDICE: Yes. Well, I could mark that - - -

PN1146

MR CRAWSHAW: The only other thing I was going to ask you to do was reconsider the leave question being decided first, having now heard the oral submissions.

PN1147

JUSTICE GIUDICE: Yes, yes. Well, we wouldn't do that tonight I don't think.

PN1148

MR CRAWSHAW: No, I just ask you to do - well - - -

PN1149

JUSTICE GIUDICE: Yes.

PN1150

MR CRAWSHAW: To consider it overnight as it were.

PN1151

JUSTICE GIUDICE: Yes. Well, we might then adjourn just for 5 minutes or so and then we will resume and hear your application in relation to the extension of this order staying Commissioner Leary's order.

ADJOURNED ACCORDINGLY