C2008/2732, Transcript of Proceedings [2008] AIRCTrans 605 (8 October 2008)

TRANSCRIPT OF PROCEEDINGS

---

Workplace Relations Act 1996

JUSTICE GIUDICE, PRESIDENT, SENIOR DEPUTY PRESIDENT KAUFMAN, COMMISSIONER ROBERTS

C2008/2732

s.120 - Appeal against the decision [[2008] AIRC 1127] and order [PR982528] of Commissioner Cargill in Sydney on 24 July 2008 in U2008/13. Re termination of employment
Brian Brown
and
Coles Group Supply Chain Pty Ltd
(C2008/2732)

SYDNEY

9.59AM, WEDNESDAY, 24 SEPTEMBER 2008

PN1

MR A JOSEPH: I seek leave to appear as counsel for Mr Brown and I have with me MR S MUELLER from the NUW with me at the bar table.

PN2

MR B CROSS: I appear on behalf of the respondent and I am instructed by MS J DENNIS of Corrs Chambers Westgarth Solicitors.

PN3

JUSTICE GIUDICE: I think you require leave, Mr Cross, but you're both in the same position so leave is granted in each case.

PN4

MR CROSS: Yes.

PN5

JUSTICE GIUDICE: Yes, Mr Joseph.

PN6

MR JOSEPH: Thank you, your Honour. Your Honour, might I inquire whether the Commission has had the opportunity to read the written submissions filed as well as the decision under appeal?

PN7

JUSTICE GIUDICE: Yes, we have.

PN8

MR JOSEPH: And I can at the outset the appellant would seek to rely on the written submissions of outline that's filed.

PN9

JUSTICE GIUDICE: Yes.

PN10

MR JOSEPH: Subject to something that I have to say towards the end of my address. Can I just again, although I don't expect that I'll refer to it in detail, but hand up copies of some decisions referred to and a list of authorities. If I could hand up three copies of McLauchlan, Iliadis and Ellawalla, as well as excerpts from House v The King for the Commission's benefit. Again I can say I don't intend to refer to them in any detail. One other very brief administrative thing, if the Commission pleases, if I might with leave and I spoke with Mr Cross about this before the Commission sat this morning, it would appear that the appeal books don't have Mr Brown's initial application in them.

PN11

JUSTICE GIUDICE: Yes.

PN12

MR JOSEPH: If I might just with leave hand up copies of the application for relief re termination of employment.

PN13

JUSTICE GIUDICE: Yes, that's fine

PN14

MR JOSEPH: I have provided a copy to Mr Cross. If I might begin, if the Commission pleases. The facts and circumstances of the case are set out in Commissioner Cargill's decision and the Commission would be aware that the appeal is only as to remedy and the appellant's position is that the Commission erred in not finding reinstatement to be appropriate in the circumstances of the case and consistent with her decision. In the case itself it is accepted that four people including the appellant were terminated from their employment at the respondent's Eastern Creek warehouse surrounding circumstances of complaints arising from a particular person co-worker in relation to suffering harassing and discriminatory conduct.

PN15

Now, in this particular circumstance two of those support people who were dismissed made no application and the decision that's the subject of the appeal involved an application by the two other persons being Mr Brown and
Mr Fatialofa. Now, it's clear in my submission and from the decision of the Commission that Mr Brown's behaviour, whilst not condoned, was seen in a different light, a somewhat different light to that of Fatialofa and one might say by inference from the other two persons who had been dismissed in the sense that his sins were that, and I'm looking at paragraphs 133 and 134 of the decision which is in appeal book page 27.

PN16

The matters are set out there in that Mr Brown in essence, condoned went along with the behaviour of the other employees and that his behaviour was thus viewed as harassment. He didn't attempt to stop that behaviour and took no steps to report it. Now, the decision itself, if one goes back to the beginning of Commissioner Cargill's consideration at paragraph 114 - - -

PN17

JUSTICE GIUDICE: Mr Joseph, could I just ask you about one thing, it's only a question of clarification?

PN18

MR JOSEPH: Yes.

PN19

JUSTICE GIUDICE: The paragraphs that you've just referred us to generally starting at 133, I wasn't entirely sure whether the Commissioner had indicated how many times Mr Brown's conduct had occurred and I was unsure whether I should read 133, for example, in the context of the observation of the finding in 131 that Mr Fatialofa's conduct took place over a period of six weeks or a shorter or longer period. But she said it was more than just a one off but she doesn't really quantify it. Are we to take it that Mr Brown's part in that is of the same frequency, whatever that might be?

PN20

MR JOSEPH: I can't answer that question with precision, your Honour.

PN21

JUSTICE GIUDICE: No.

PN22

MR JOSEPH: I think it may be accepted that Mr Brown's conduct was found to have occurred on more than one occasion over a period of time. But in the findings themselves there wasn't, I don't think from my reading of it, a degree of precision that would allow you to say from X date to Y date Mr Brown did the things that are complained of on three or four or five occasions, or however many.

PN23

JUSTICE GIUDICE: Yes, well, that was the sense I got from it but I wanted to make sure I wasn't missing anything.

PN24

MR JOSEPH: Can I say this, the evidence, the reason for picking out the six weeks, there was a date within which I think Mr Zuhair who is the complainant had actually gone onto the night shift, I think his evidence was that nothing happened for a couple of weeks and then something started and then there was a period when he complained and I think he left the night shift as well. So that provided the boundaries.

PN25

JUSTICE GIUDICE: Yes, I see.

PN26

MR JOSEPH: But I don't think the evidence sort of said, well you know, on 29 November I was driving down a certain aisle and they came upon me and so forth.

PN27

JUSTICE GIUDICE: No. Thank you.

PN28

MR JOSEPH: Now, just returning to where I was, in paragraph 114 the Commission notes that the primary issue that she was to determine was whether the termination of the appellant was harsh, unjust or unreasonable and in that regard she needed to consider the factors set out in section 652(3) and in that context the first thing, albeit not the only thing, that needs to be considered was whether there was a valid reason for termination. Now, it's acknowledged and I think she referred to Mr McLauchlan in this sense where there was an observation that from the time that - well, there was a predecessor to this section in the same form where more than the valid reason needed to be taken into account or considered in deciding the overall question of whether the dismissal was harsh, unjust or unreasonable.

PN29

Commissioner Cargill acknowledged that observation at paragraph 118 on page 24 in saying the valid reason for termination was only one of the issues to be considered. But it was also acknowledged when the Commission was considering the paragraphs, I think 136 in the decision and 141, where makes a finding in paragraph - sorry, I shouldn't jump around. But if you go to AB27, paragraph 135 where she finds that Mr Brown's actions amounted to misconduct but was not satisfied that they amounted to a valid reason for termination. Now, in paragraphs 136 and 141 by inference the Commissioner looks at subparagraphs (b), (c) and (d) of subsection (3), that is, whether the employee was notified of the reason, whether he was given an opportunity to respond and if the termination related to unsatisfactory performance, there's a situation - there's a recognition that those categories don't apply in the first instance in relation to being notified of the reason and give an opportunity to respond.

PN30

They're not relevant because there was no valid reason for termination in the first place and then in relation to the unsatisfactory performance criteria, again that wasn't relevant in considering, strictly speaking, in considering whether the dismissal was harsh, unjust or unreasonable. Because the dismissal arose from conduct said to amount to misconduct as distinct from unsatisfactory performance. The reason for pointing that out is this, that where the dismissal in my submission arises from such an event that's said to constitute misconduct then the finding of whether there's a valid reason for termination takes on a particular importance.

PN31

Now, in this case the Commission in coming to that critical finding in paragraph 135 had considered what the meaning of valid reason for termination meant and referred to the well known authorities, and one might infer with approval, took into account the acceptance of the complainant's evidence over that of Mr Brown to the extent that it differed in paragraphs 122 and 123. These were differences about whether Mr Brown said he laughed and was in agreeance and condoning as it were, actively condoning or participating in the conduct complained of. She acknowledged that Mr Brown in paragraph 126 said they're well aware of the code of conduct in which his conduct was said to be in breach and she made the critical findings in paragraphs 133 and 134, or the findings that I've already referred the Commission to.

PN32

I might add just before I go any further if I can again, I'll try not to do this too much, but if I could again take the Commission back to AB15, paragraphs 64 to 65, the Commission there is recounting the evidence of Mr Bennett who I think was one of the senior - or the shift manager who was in part responsible for the decision to dismiss Mr Brown and she recounts his evidence which she preferred again over Mr Brown later in her decision, that he did not appear to be concerned about the gravity of the situation, didn't express remorse, and then says recounting the reasons for the termination of employment and outlines them there, that he admitted laughing, that his conduct was harassment and a serious breach of the code of conduct, that he took no steps to try - over the page to paragraph 65, he took no steps to distance himself, he hadn't reported the behaviour to management, he was on first and final warning and he had not shown any remorse.

PN33

So all of those findings one might infer were taken into account and they were all within the Commissioner's knowledge. She knew the test she had to apply and she applied it and it's in that context that there was a finding having taken all that into account that there was no valid reason for termination. Now, she suddenly went on in subsequent paragraphs to the extent that she referred to Mr Brown in particular paragraphs 144 to take into account the disciplinary history. Now, that was I suppose, that that was being done in essence a second time because the dismissal that she's found to be not valid, one of the reasons for that dismissal was the fact that Mr Brown already had a first and final warning from about eight months before.

PN34

But following that, in paragraph 147 we have the finding that the termination of Mr Brown's employment was harsh because it was disproportionate to the gravity of his misconduct. In essence in my submission that is a restatement that there was no valid reason for termination. Thirdly, the Commissioner did pick up the words or the meaning of harsh from the decision of the High Court in Byrne and Frew, the off quoted judgment of McHugh and Gummow JJ. But if you look at the basis of the finding that it was harsh, disproportionate to the gravity of misconduct, that if you then go back and look at what was said in paragraph 135, you'll see there that -

PN35

I am not satisfied that they amount to a serious breach of the respondent's policies such as to give rise to a valid reason for the termination of his employment. It certainly would have been appropriate for there to have been some other disciplinary action but not termination.

PN36

So in her view his employment should not have been terminated. Some other action should have been taken.

PN37

SENIOR DEPUTY PRESIDENT KAUFMAN: But she is there in paragraph 147 looking at a different matter, albeit taking into account some of the same considerations. At 135 she found that there was no valid reason for the termination.

PN38

MR JOSEPH: Yes.

PN39

SENIOR DEPUTY PRESIDENT KAUFMAN: And 147 the Commissioner is having regard to the matters that she has regard to in determining what if any remedy ought to be made. So whilst there might be an overlap she is applying a different test, is she not?

PN40

MR JOSEPH: Well, no, 147 she's not looking at remedy. She's still deciding whether dismissal was harsh, unjust or unreasonable - - -

PN41

SENIOR DEPUTY PRESIDENT KAUFMAN: I'm sorry, whether it was harsh or unjust having found that there was no valid reason.

PN42

MR JOSEPH: Sorry, your Honour?

PN43

SENIOR DEPUTY PRESIDENT KAUFMAN: She first did what she's required to do and had regard to whether there was a valid reason and found that there wasn't and then goes on after having regard to all of those matters to determine whether the termination was harsh, unjust or unreasonable.

PN44

MR JOSEPH: I acknowledge that, your Honour. I only make the observation one would struggle to find the circumstance where a dismissal was found to not be for a valid reason but not be harsh. In the context if you look at the findings that the Commissioner has made, but I acknowledge it's a wider test and the other matters have to be taken into account to the extent that they're relevant. My submission was that really in these circumstances we were focusing on act or acts said to be misconduct. But the question of whether there was a valid reason really does take on a very important role in deciding the next stage.

PN45

Now, in paragraph 149 the Commissioner acknowledges the provision of section 654(2) which require the Commission not to make an order unless the Commission is satisfied having regard to all of the circumstances of the case and they're set out there under that the remedy ordered is appropriate. Now, I don't need to take the Commission to Ellawalla but it was made clear and I think this is referred to in my written outline in paragraph 25 that in order to exercise the discretion that the Commission has and yes, it's a broad one, but it must exercise judicially and it does require all of the circumstances to be taken into account, all of the circumstances, not just some of them which is one of the complaints made here.

PN46

Despite the Commission having said in paragraph 150 that she has had regard to all of the circumstances of the case, in paragraph 153 - perhaps I should go back and note that she does recite - or sorry, deal briefly with the matters dealt with in sub clauses (a), (b), 2(a), 2(b), 2(c) and 2(d) and none of those would seem to be determinative in any particular way or fashion. Certainly they couldn't be read as providing a basis on which reinstatement would be less appropriate. We then get to paragraph 153 and it's said that subsections (3) and (4) of section 654 make it clear that the remedy of reinstatement is to be considered first. Now, I might just pause there. It's clear that there's now no longer an overriding presumption in favour of reinstatement. It's not reinstatement unless it's impracticable but it's still the primary remedy. It's still the first one to be considered.

PN47

The Act isn't written in such a way that the Commission simply chooses one or the other as it were and I don't mean that in a disrespectful way. The requirement is to consider reinstatement first and only if it's inappropriate to decide on whether some other remedy should be awarded. Now, in that sense in my submission and particularly where the applicant who said I want reinstatement, I don't want compensation, and his case has been made out to the necessary extent, some very good reason in my submission would have to be found for reinstatement to not be acceptable or to not be appropriate and I will return to that in a moment. But three reasons were given and it would appear that those are the reasons for deciding that reinstatement was not reinstatement.

PN48

Firstly, that Mr Brown was guilty of misconduct. Secondly, that he didn't appreciate the gravity of his actions and another comment is made there about the degree of uncertainty about his reaction. And thirdly, his relatively short period of employment and his disciplinary history. My first observation is this, all of those matters, with the absence of his short period of employment, were relied upon by the employer to dismiss him and that's the dismissal that was not valid.

PN49

JUSTICE GIUDICE: But what's the discretion for, Mr Joseph? I mean, if it's simply the case that if there's a finding there was no valid reason for the termination then reinstatement must automatically follow, isn't that the position that you're putting the Commissioner in?

PN50

MR JOSEPH: No, not saying it must automatically follow but there would have to be in the circumstances, and I can't in the circumstances of this case, I can't see on a basis on which it wouldn't follow in my submission. It might be, for example, some other evidence that's before the Commission that - well, firstly for example, the person may not want reinstatement. That's one reason why it wouldn't be ordered. But there may be some other issue about the viability of the order on the employer's establishment, for example. It may not be practicable and I use that term in a general sense, not a legal sense, to order reinstatement.

PN51

But in the ordinary course, all other things being equal, your Honour, in a situation where you don't have a valid reason for termination, that is, the termination shouldn't have occurred in the first place, one would think there would need to be some overwhelming reason to find that reinstatement wasn't appropriate to put the person back in a position that they should not have been taken out of, because here what was relied upon - you see, if one takes one misconduct, the fact that there was a finding of misconduct out of the equation, had there been a finding that there was no misconduct, for example, and there was no valid reason for termination, as in the termination was baseless or had no good reason or no reason at all, surely those circumstances, the fact that there wasn't a valid reason for termination would count, would count very considerably.

PN52

Once that finding is made that there's no valid reason for termination that should weigh very heavily upon the discretion that exists. The discretion isn't at large. So the central point is this, how can the three reasons that are the basis - how can those three reasons be bases for not reinstating. I'm probably mixing my grounds here, I must say, between the failure to take into account relevant factors and just the more general unjust or unreasonable grounds that are pleaded. How can they be reasons to not reinstate? It's somewhat difficult to understand how they could be reasons not to reinstate where those reasons themselves didn't make out a valid reason for termination.

PN53

Now, in terms of the matters that were not taken into account, where misconduct is relied upon it seems clear in my submission that the Commission has failed to properly appreciate the effect of her finding that there wasn't a valid reason for termination. See, the finding was that there was a misconduct had occurred but it simply wasn't serious enough, or to use another phrase, wasn't serious and wilful to the extent that it justified the termination.

PN54

JUSTICE GIUDICE: There might be an issue here about what constitutes a valid reason.

PN55

MR JOSEPH: I'm sorry?

PN56

JUSTICE GIUDICE: There may be an issue here about what constitutes a valid reason. If there's a finding of misconduct, on one view that is a valid reason.

PN57

MR JOSEPH: Well, that aspect of the decision is not challenge. I mean, sorry, I should put it this way, there's no notice of contention so one would assume the parties are going forward on the basis that that finding remains as it is. I mean, it could have been open, your Honour. I accept it may have been open in the circumstances for Commissioner Cargill to so find, but she heard all the evidence, she considered the evidence and she made a decision that Mr Brown's conduct was not serious enough to support a finding of a valid reason for termination.

PN58

JUSTICE GIUDICE: Well, you seem to be putting in issue the assessment of the gravity of the misconduct finding. You seem to be saying that the misconduct was of such a character as not to justify a finding that reinstatement was inappropriate. Really what I’m testing with you is the extent to which we are bound by the Commissioner's finding that the misconduct in this case didn't constitute a valid reason. I mean if we look at her factual findings we might come to a different conclusion as to whether there was a valid reason.

PN59

MR JOSEPH: I understand that but the appeal doesn't lie simply on the basis - with respect, it doesn't lie on the basis that the Commission sitting in the appellate jurisdiction that it might come to a different view. Perhaps I have mangled my words a little bit, your Honour, bit it's acknowledged and not challenged by anybody that she made a finding that misconduct had occurred.

PN60

JUSTICE GIUDICE: Yes. Look, the point of my question was really quite a simple point. You are putting in issue the gravity, if you like, of the misconduct. You're not saying the finding of misconduct was wrong, as I take it.

PN61

MR JOSEPH: No.

PN62

JUSTICE GIUDICE: But you are saying that the Commissioner simply put too much weight on that and that she should have given it very little weight in light of the fact of her other finding that that misconduct didn't constitute a valid reason. But doesn't that force us to look at the issue of the gravity of the misconduct?

PN63

MR JOSEPH: No, because I perhaps - and again I might be doing my case a disservice with the way I've described it, because the principle point is this, it is not the fact that Commissioner Cargill took into account that misconduct had occurred, so much as the failure to take into account that she had made a finding that there was no valid reason for termination. You see, can I say this and this was the point I was trying to make before, with respect, your Honour, once there's a finding that there's no valid reason for termination the fact that there is a finding of misconduct in my submission takes on a somewhat lesser role. Once there's a finding that the person shouldn't have been terminated in the first place, that provides a very powerful basis on which to find a very powerful counterpoint to any argument that reinstatement would not be appropriate. That's the point. It's the failure to take that properly into account.

PN64

JUSTICE GIUDICE: Yes.

PN65

MR JOSEPH: And again, those other points perhaps it's to this extent, that the other points raised there as reasons were all things that were before the Commission and all things that she could take into account and did take into account in finding that there was no valid reason for termination. It does somewhat, well, curious at the very least that that could then be a basis for arguing that reinstatement was not appropriate.

PN66

SENIOR DEPUTY PRESIDENT KAUFMAN: Mr Joseph, could you remind me what his disciplinary history was? As I recollect, he had been disciplined for a similar incident, is that right?

PN67

MR JOSEPH: That's correct. He'd been disciplined for an issue, it was an issue that was said to be in breach of the same code of conduct which is a document that deals with all of the responsibilities of the employees but it was in relation to an incident with a forklift that he hadn't reported to management. That was in April 2007 I think.

PN68

SENIOR DEPUTY PRESIDENT KAUFMAN: Is it your submission that the Commissioner erred given that the nature of what he'd been disciplined for was quite different to what he was being sacked for, that she erred in taking into account that disciplinary history, is that your submission?

PN69

MR JOSEPH: That might be a secondary submission but I think the more important submission from my point of view is that she took all that into account. It was all being urged for her to take into account that disciplinary history and I took the Commission to reasons why the respondent had dismissed Mr Brown in the first place and one of the reasons was the fact that he had a first and final warning for an unrelated matter. All of those were taken into account leading up to the finding that there was no valid reason for termination.

PN70

SENIOR DEPUTY PRESIDENT KAUFMAN: Yes, but is that something that was open to the Commissioner to take into account in deciding not to reinstate, or putting weight on perhaps might be a better way to put it.

PN71

MR JOSEPH: In my respectful submission in the circumstances where there was no valid reason for termination, in my submission it should have been given very little weight, if any at all. Because what one wonders, if a decision has been made and taking all that into account that there was no valid reason for termination, why should it form a basis for not putting that person back into the position that they were taken out of. Just finally on that point, the short period of employment was said to be relevant and I've dealt with that in the written submission to a degree but again, one wonders and I do appreciate that it's a matter that has to be taken into account. It's one of the matters set out in section 654(2)(b), the length of the employee's service.

PN72

But in my submission why would, and I'm making the question rhetorically, why would short service be an argument against reinstatement if there was no valid reason for termination? The only other point I wanted to make is in relation to the second finding or the second reason, Mr Brown's appreciation of the gravity of his actions. Again, it was a matter that really was one of the bases for his dismissal in the first place and there's a finding about the degree of uncertainty of his reaction if faced with similar issues in the future and the word militates against reinstatement is used, which seems a fairly strong word to use particularly with the lack of clarity, in my submission, of that particular finding -

PN73

the degree of uncertainty about his reaction if faced with similar issues.

PN74

Now, I think I've dealt with this in the written submission but it's entirely unclear in my submission where the similar issues would arise from. There's no evidence of Mr Brown having had problems with other employees and I've already dealt with the fact that I think his behaviour towards the complainant was viewed by the Commission as being in a somewhat different light. It's probably fair to say he was a follower rather than a leader.

PN75

SENIOR DEPUTY PRESIDENT KAUFMAN: Was there some evidence that that conduct ceased after the relevant supervisor became involved?

PN76

MR JOSEPH: Yes, there was. There was. There was a finding that Mr Zuhair had reported the matter to - I'm just looking for the relevant point, your Honour. There was a shift meeting I think that got called in early December after
Mr Zuhair and I'm just looking for the - - -

PN77

COMMISSIONER ROBERTS: Para 81 refers to Mr Fatialofa.

PN78

MR JOSEPH: Yes.

PN79

COMMISSIONER ROBERTS: And it does refer to the shift meetings on 7 and 8 December.

PN80

SENIOR DEPUTY PRESIDENT KAUFMAN: Yes.

PN81

MR JOSEPH: I think what happened was - and Mr Fatialofa was the only person who put that in his case. There's no evidence of any action or any misconduct, if I can use that term, or any conduct occurring after that date and I think the respondent's view as I understand it is that prompt action was taken or action was taken shortly after those meetings by the employer. That might be a long winded way of answering your Honour's question.

PN82

SENIOR DEPUTY PRESIDENT KAUFMAN: Yes, thank you.

PN83

MR JOSEPH: I think the only other thing I would deal with is to the extent that I need to be heard on the question of leave. Well, there's two other matters. One is the question of leave and that is, in my submission if the Commission finds that there are arguable cases obviously in order to be successful, for Mr Brown to be successful in the appeal there would have to be appealable errors in the House v The King sense or in the context of jurisdictional error to be found. In order for leave to be made there needs to be an arguable case that such errors exist. So I don't know there's much more I can say on the question of leave because one inevitably - well, doesn't inevitably follow the other, but if the appeal points or any of them are good then there's a basis for leave.

PN84

I note although it wasn't dealt with in submissions, section 685(2) of the Act appears to deal with appeals from - or does deal with appeals from decisions made under Subdivision B of Division 4 and an appeal in relation to such orders may only be made on the grounds that the Commission was in error in deciding to make the order. I note on page 19 of McLauchlan dealing with the predecessor provision that leave would only be granted which generally should not be granted unless the appellant satisfies the Commission that there is an arguable case that the member at first instance has either made a legal error or has acted upon a wrong principle, given weight to irrelevant matters, failed to give sufficient weight to relevant matters or made a mistake as to the facts or that the decision was plainly unreasonable or unjust.

PN85

I don't know that that takes us great deal further from what we know House v The King in any case but that would be the appropriate test for leave in this case. To the extent that I need to add, I would simply say that it may be argued that there is at least to some degree a public interest question or a question of interest in the context of what we say is the main point or the central point of this appeal being the failure to take into account the fact that there was a valid reason for the termination in the context of deciding whether reinstatement is appropriate or not. The only other matter I think I need to deal with is there was a reference in my written submission at paragraph 31 which refers to Mr Brown seeking reinstatement to his previous position and I have to put my hand up, Mr Cross correctly pointed out that the evidence before the Commissioner and it was only a; couple of points in the transcript, was that night shift had after the terminations of these individuals, including Mr Brown, had ceased. So I acknowledge that I simply missed those particular transcript references.

PN86

Can I say just in relation to that point that Mr Brown sought and the application says that he sought reinstatement. The Act in section 654(3) says that -

PN87

If the Commission considers it appropriate, the Commission may make an order requiring the employer to reinstate the employee by:
(a) reappointing the employee to the position in which the employee was employed immediately before the termination.
(b) appointing the employee to another position on terms and conditions no less favourable.

PN88

Certainly in relation to the position it might be said that the position being sought by way reinstatement is storeman, but the issue of night shift at that particular point in time might be whether that actually formed his position or whether that was simply a particular shift that he was working on as distinct from his position being as a storeman is another matter of course. I might say this, whilst the point is slightly less sharp given the evidence that's pointed out by Mr Cross, the point that's still being made in paragraph 31 is this, that there's no reason, there could be no reasonable basis for the Commission to find if Mr Brown had been reinstated that there would be any basis to say that his conduct in the future if faced with similar issues, there being no evidence as to similar issues, as to why that would militate against reinstatement, particularly in the circumstance where the three persons who had been the main, what I might refer to as the main antagonists, they'd all had their employment terminated in any case.

PN89

JUSTICE GIUDICE: But isn't the Commissioner just making a finding or expressing a view that she is not persuaded that the applicant would not behave the same way in the future? I mean, you seem to be elevating it to some sort of evidentiary finding. It's really an assessment, isn't it, that on the basis of what she's heard and seen she's not - or she's uncertain as to how he might respond in the future?

PN90

MR JOSEPH: And I think in my submission, your Honour, I've said that that finding is unreasonable to this extent, we're dealing here with a situation where (a), we've got a finding that there was no valid reason for termination and his lack of remorse and he's failure to appreciate the gravity of his conduct were all issues for termination.

PN91

JUSTICE GIUDICE: Yes.

PN92

MR JOSEPH: And secondly, we're dealing here with an employer, not any employer but Coles Myer who are in a position where, yes, the person may transgress again. Now, it's not uncommon, your Honour, for people to act in proceedings before the Commission to have a particular view of their conduct and the decision of the Commission disabuses them of their belief by pointing out that their behaviour far from not being reprehensible is so. That in itself shouldn't be a strong factor weighing against reinstatement. Mr Brown is like any other employee and if he didn't get the message then he's going to be dealt with in the ordinary course and it couldn't be suggested that Coles Myer wouldn’t have the resources to do so.

PN93

JUSTICE GIUDICE: Yes, but if I understand your submission correctly, you're saying there's a different way to look at it and a different weight you could put on it. But my question is why isn't it simply open to the Commissioner if she is uncertain to place some weight on her uncertainty? Surely that's a matter she can take into account.

PN94

MR JOSEPH: Well, it's matter that she can take into account but not to the exclusion - not in my submission to the exclusion of the other matters that I have raised and there was also the issue that I have raised in the submissions and
Mr Cross has said something in his submission about this, about Mr Brown's level of contrition. Now, it may be or it may not be, it's a bit hard to tell whether that in itself was taken into account.

PN95

JUSTICE GIUDICE: Well, it seems to be implicit in an expression of uncertainty that she was making some evaluation of the level of contrition and what the future conduct might be.

PN96

MR JOSEPH: Again, well, I don't know that I could add a great deal more than what I have already said, but to the extent that that would be where we've got here three and they all obviously appear to be - well, they appear to be the determinant factors, whilst it might be open to the Commission to take into account, it's the weight that it's given and it's the failure to take into account the other matters where she's made findings in preceding paragraphs in her decision, as I've set out. The only other thing I think I need to say is this and my client has sent to
Mr Cross's instructing solicitors a statement. Now, if the Commission were to uphold the appeal, subject to the Commission's view as to how they're to dispose of the matter, my client would seek to tender a statement in statement form some evidence dealing with the - in essence it deals with the shift patterns that exist as of today at the relevant premises of the warehouse. A copy of that statement has been provided to my learned friend's instructing solicitor.

PN97

SENIOR DEPUTY PRESIDENT KAUFMAN: To what end would you seek to lead that evidence? Is it to say that he could work at a particular shift or something?

PN98

MR JOSEPH: It only goes to the existence of - your Honour might recall I made a concession about there not being a night shift at the time the decision was made by Commissioner Cargill. The evidence goes to the existence of particular shifts and shift patterns as at today's date.

PN99

SENIOR DEPUTY PRESIDENT KAUFMAN: Yes, I'm still not sure why, assuming we give leave, you want to lead that evidence.

PN100

MR JOSEPH: Well, it may depend on how the Commission intends to deal with the appeal, whether it intended to substitute its own decision or, if the appeal was upheld, to substitute its own decision.

PN101

JUSTICE GIUDICE: It's only if we decided that the Commissioner was wrong and we were going to reconsider what the remedy should be, is that the point?

PN102

MR JOSEPH: Yes, that is the point. I'm sorry, perhaps I wasn't making myself clear. But it only becomes relevant in that circumstance, not prior to that. And I can only say in that sense that it appears to have the - I only make the point that the non existence of the night shift doesn't appear to have loomed large. It wasn't referred to in the decision. But it would only be relevant to the question of remedy if we got that far.

PN103

JUSTICE GIUDICE: Yes, thank you Mr Joseph. Mr Cross?

PN104

MR CROSS: Your Honours and Commissioner, if I could just deal with one matter that arose in a question by the Senior Deputy President five minutes ago, before I commence my submissions here. It went to a question, as I understood it, your Honour, dealing with a possible remedial, or remedying conduct upon notification to a supervisor. That was not part of Mr Brown's case. That was part of Mr Fatialofa's case, and it is dealt with by the Commissioner in paragraph 145 at Appeal Book 38.

PN105

Essentially what was sought to be put in Mr Fatialofa's case was following the authority of Drury v BHP Refractories, an argument that the employer had gone back for a second bite of the cherry. Whereas in fact the evidence was quite clear, the evidence of Mr Graham and Mr Weilo, it was put on behalf of the applicants, that in fact the shift meetings on 7 and 8 December did not deal with any specific conduct against Mr Zuhair. There were general statements in relation to compliance with the code of conduct. It did not form part of Mr Brown's case.

PN106

JUSTICE GIUDICE: Thank you.

PN107

MR CROSS: If I may then revert to our submissions? We have of course provided that to the Commission to read that in our case. Importantly, we addressed the issue of leave to appeal at the commencement of our submissions, and we referred the Commission to the Full Bench decision in Saffries Pty Ltd. Because what is clear from the appeal, notice of appeal, the submissions on behalf of the appellant and what has been put today is that there has not been any substantive submission in relation to why leave to appeal should be granted, and we submit such is required. It is not sufficient to put, as it was put today, that if any of the appeal quotes are good it follows.

PN108

That is exactly what was counselled against in Saffries. So it is the submission of the respondents in fact on the point of leave that leave would have to be granted. We also have adopted the decision in Australia Meat Holdings v McLauchlan, and refer to page 2 of our submissions, to the relevant parts of that. And, importantly, we don't. But what has been appealed against us here is a discretionary decision of the Commission. The Commission's given broad discretion in relation to remedy, and it must consider all the circumstances of the case.

PN109

Such was also referred to in McLauchlan, and I'd simply note it's at page 17.5, where it was considering the statutory test, although not dissimilar to that that is currently before the Commission, but it urged, as in fact the words of section 654 urge, that the Commission must have regard to all the circumstances of the case. That is exactly what the Commission did at paragraphs 150 to 153 of its judgment.

PN110

What has been focused on by the appellant is the finding at paragraph 135 of the Commission's judgment at Appeal Book 27, and that is the finding that there was not a valid reason, but it followed then as to a finding of harshness. However, when one considers the other two links of the test it is quite clear that the respondent was overwhelmingly successful in proving that the dismissal was not unjust because, as the Commission found at paragraph 135, this employee was guilty of misconduct. The employer also proved that it was not unreasonable because, it is quite clear in the decision, the respondent's evidence was accepted as to the facts surrounding the conduct of Mr Brown.

PN111

The respondent's witnesses were preferred. Now, those findings of the Commission were of course telling when the Commissioner turned her mind as she was inclined to, to all the circumstances of the case. There were, until my friend's submissions, no challenges to factual findings of the Commissioner, which is a very important point in this matter. Until my friend was questioned in relation to the gravity of the misconduct there had not been any challenge to any of the findings, factual findings of the Commissioner.

PN112

Now, when one looks at those factual findings they are telling. At paragraph 133 in summary form the Commissioner notes:

PN113

I accept that Mr Brown laughed whilst derogatory remarks were being made towards Mr Zuhair ...(reads)... and were in themselves a form of harassment.

PN114

Mr Brown - and this touches upon the Senior Deputy President's question as well - did not seriously attempt to stop the behaviour or any of those employees around it. That is noted at paragraph 134 of the judgment. What arises at paragraph 134 in the second sentence is also what was an important part of the case. I will return to that on the question of contrition, but that is that:

PN115

Mr Brown's explanation for this failure and his distinction between seeing and hearing was totally without foundation.

PN116

I'll take the Full Bench to those particular parts of the transcript. There was a question of my learned friend in relation to what may have occurred. When one considers the evidence as recited by the Commissioner one gets a greater flavour of what in fact occurred. As was noted at paragraphs 122 and 123, the evidence of the respondent's witnesses was preferred where there be a question raised. Mr Zuhair's evidence is summarised at Appeal Book page 10, paragraph's 29 to 31.

PN117

There was a question of my learned friend in relation to how many times the particular conduct may have occurred. And I think my friend correctly said that one couldn't put a specific figure on the number of occasions. And I think that's a fair assessment. He said you couldn't say it was three, four or five. But what one can say is that it was an ongoing course of conduct. At paragraph 29, as the Commissioner notes:

PN118

Mr Zuhair's evidence is that when Mr Fatialofa and AJ made various comments to him Mr Brown would laugh. On one occasion when AJ made sexually movements and called him a name he understands to mean "bitch" in Arabic, Mr Brown nodded and laughed. Mr Zuhair's evidence is that he felt Mr Brown agreed with AJs comments and gestures, which was upsetting to him.

PN119

At paragraph 30:

PN120

Mr Zuhair's evidence is that Mr Brown walked like a monkey at one time when AJ was making derogatory remarks. His evidence is that on occasion when Mr Brown was with AJ he would sometimes stare at him and tilt his head. Mr Zuhair's evidence is that Mr Brown regularly whispered to and laughed with AJ when they saw him.

PN121

Now, that gives an accurate reflection of Mr Zuhair's account that was accepted by the Commission. So that over a period of six to eight weeks this is the conduct that was imposed upon Mr Zuhair, as accepted by the Commissioner. When one looks at Mr Szarafinski's evidence, that was also accepted. And that's at Appeal Book page 12. One gets a further flavour in relation to the conduct that Mr Szarafinski observed, and it was noted that it was only on a number of occasions that he - on a few occasions it's referred to that he observed - what he observed. But he also gives evidence at paragraph 44 in relation to the effect on Mr Zuhair of such behaviour by these four persons.

PN122

And in as much as it's been put this morning that Mr Brown was some lesser player, I think it can be fairly said that Mr Brown was a key player. He may not have made certain comments, but when one looks at the accepted evidence in relation to his behaviour there is little doubt or little question as to why the Commissioner found he had misconducted himself.

PN123

SENIOR DEPUTY PRESIDENT KAUFMAN: But aren't you going a little far, Mr Cross, in asserting that he was a key player in light of the Commissioner's findings and particularly her finding that there was no valid reason for the termination of his employment?

PN124

MR CROSS: What I'm putting, Senior Deputy President, is this. That there were four people whose conduct was affecting Mr Zuhair, and in as much as it's put that the conduct of Mr Brown was somehow lesser, it was clearly in breach of a code of conduct that Mr Brown conceded. And there's no question about that. He was fully aware of it, he fully understood his obligations in relation to it. Very clearly breached it. There's a very interesting explanation for that that supports some of the findings in paragraph 153 of the Commissioner.

PN125

JUSTICE GIUDICE: Mr Cross, one thing that I raised with Mr Joseph, and it's been going through my mind listening to both counsel, is the extent to which the finding that there was no valid reason is relevant to the question of remedy. And I must say I'm coming to the view that it might be totally irrelevant. Really the question is whether the - the question posed by the statute is whether the remedy is appropriate, and that when one has factual findings about what occurred, I suppose that the statue requires you to consider whether there's a valid reason at the remedy stage. I'm answering my own question on that, but a findings as to conduct presumably must also come into it somewhere. Sort of a curious mixture of a statutory finding, a statutory formula which requires a particular question to be addressed, but also a requirement to look at all the circumstances. I'm just not too sure, as you can tell from my rambling question, how these two things come together.

PN126

MR CROSS: I think in response, your Honour, it is this. Valid reason, the formulation by the Commissioner of her decision in relation to whether there was a valid reason was based on certain facts that are then reconsidered as part of the many facts that are necessarily considered in all the circumstances of the case when you're considering remedy. What has been put by the appellant is that the finding in relation to that should somehow gain predominance when deciding a different question. And we certainly do not share that view. I hope that answers your Honour's question.

PN127

JUSTICE GIUDICE: Yes.

PN128

MR CROSS: In the final excerpt of evidence, accepted evidence, that the Commission referred to there was Mr Bennett's evidence, and that is at paragraph 62. Importantly, we would draw the Commission's attention to paragraph - we'll deal with 15. Paragraph 62, 64 and 65. And particularly paragraph 64, and this was the accepted evidence of Mr Bennett, is noted at paragraph 123.

PN129

Mr Bennett's evidence is that during the meeting Mr Brown did not appear to be concerned about the gravity of the situation because he was smiling and smirking. His evidence was that Mr Brown did not express any remorse for his conduct. Mr Brown's evidence is that he denied smiling and smirking and that he was aware of the seriousness of the situation.

PN130

Now, of course, at paragraph 123 the Commissioner finds that Mr Bennett was to be accepted. Importantly, when dealing with her preference as to the evidence of the respondents, the Commissioner states in the final sentence of paragraph 123 on Appeal Book 26:

PN131

My findings should be considered against the background of these comments.

PN132

Clearly the Commissioner was referring to the comments in paragraphs 122 and 123 in relation to the acceptability of the respondent's evidence and the unacceptability of Mr Brown's where it differed. Pursuant to the statutory criteria as clearly outlined in section 654(2) the Commission had to consider all the circumstances of the case. Paragraph (e) compelled reference to any other matters the Commission considered relevant, and it compelled consideration of whether the remedy would be appropriate.

PN133

It simply cannot be doubted on the face of the Commissioner's judgment that she considered each and every paragraph of section 654(2). She says as much in her decision and gives reasons at times as to the matters that affected it, that Mr Brown was guilty of misconduct. That was a finding that has simply not been challenged. And when one considers the evidence of that misconduct that I've taken the Commission to this morning one gets a very significant flavour as to what the gravity of that misconduct was and those findings in relation to the acceptability of the respondent's evidence on what occurred and Mr Zuhair's has been found by the Commission and not challenged by the appellant.

PN134

The Full Bench can proceed with a full understanding of exactly what Mr Brown did in breach of the code of conduct. The Commissioner, at paragraph 153, found that she had significant doubts about Mr Brown's appreciation of the gravity of his actions. And there's been some question, or it's been put by my learned friend this morning that there's no basis to say anything regarding conduct in the future. With respect, when your Honour, the President, stated that the Commission was expressing a view of an assessment of what she'd seen and heard, we would submit that that would be correct.

PN135

It's quite clear for example from the evidence of Mr Bennett at paragraph 64 of the decision exactly the demeanour of Mr Brown in the termination meeting. And in considering that behaviour there should be little question as to why the Commission should express such doubts as to the conduct of Mr Brown in the future. One must also look at the important point, being what the Commission described at paragraph 134 as being:

PN136

Mr Brown's explanation for his failure and his distinction between seeing and hearing was totally without foundation.

PN137

This is another classic exhibition of exactly why it could be found by the Commission that Mr Brown would not appreciate the gravity of his actions. If I could take the Commission to Appeal Book page 65 from reference EM631.

PN138

JUSTICE GIUDICE: Is this the evidence of Mr Brown?

PN139

MR CROSS: Yes. Now, there's a question at PN631, and at 632:

PN140

So whereas you said you never heard, you agree you did hear the comment made?---I didn't say I've never heard it. I've said I've never seen it.

PN141

And there are two further answers at 633 and 634: An interesting distinction was developed by Mr Brown to explain away why he hadn't reported something, and it's returned to over the page at PN652:

PN142

Upon seeing it having an effect on Mr Zuhair, from your training you knew you were obliged to report it?---If I'd seen it, yes.
Well, you did see it?---No, I heard it.
You heard it, yes. And upon hearing it you were obliged to report it?---No.

PN143

And then the question at PN656 is put. A very interesting distinction adopted but of course entirely understandably why the Commissioner, in her decision, would find it was totally without foundation. And when one considers such disingenuous answers given on such a serious matter that the training in relation to which was simply without question. It was conceded absolutely by Mr Brown that he received a two day induction that included significant dealings in relation to equal opportunity and discrimination.

PN144

While Mr Brown's period of employment was something that by the statute the Commissioner had to consider, it was a short period of employment during which he received a final written warning. Now, your Honour, the Senior Deputy President, has referred this morning to it possibly being for a different matter. If I could just take your Honours to page 400 of the Appeal Book, and unfortunately it's in the second volume, a very little visited volume of the Appeal Books in this matter.

PN145

This document, and it starts at page 397, is the Coles Group Team Member Code of Conduct. It was without question in the proceedings that this was a document that everybody knew and understood. It had been explained in inductions either in its former incarnation as an employee behaviour document, and it had also been annexed to pay slips. At page 400 it deals with equal opportunity, and at page 402 it deals with reporting a breach and breaching the code, the consequences of breach.

PN146

Now, there was no question in relation to Mr Brown's knowledge of this code and that he understood his obligations of course, and he's even signed an acknowledgement of the code that is an exhibit in the proceedings. Now, the warning that was received by Mr Brown previously was also for breach of the code of conduct. If I could take your Honours to pages 793 of that Appeal Book, that is the prior warning of Mr Brown. And it is correct, and your Honour, the Senior Deputy President, has acknowledged, it did relate to a forklift safety incident adequately described at section 3.

PN147

But when one looks at then - and this is a standard discussion record that there were some findings in the judgment that a standard document within Coles, that prior to the discussion of section 3 is filled out so that there is a clear explanation of the two particular participants in the disciplinary meeting as to what would occur. If one goes to page 795, team members response, no comment, happy with statement. And then one looks at what is expected at section 5. There's reference to code of conduct, there's reference to consequences of breach of the code of conduct.

PN148

Over the page at 796 at the top it deals with where that might be so serious as to be treated as misconduct. And it was clearly noted at page 797 that it was a first and final discipline warning. Mr Brown was left in no question as to what the consequences of further disciplinary breaches were, and there was no question as to his understanding of his obligations under the code of conduct. But Mr Brown of course sought to distinguish between whether you saw someone discriminating or heard them.

PN149

When one considers paragraph 153 of the Commissioner's judgment it is simply unremarkable, bearing in mind the unchallenged facts of the case, that the Commissioner would have relied on those particular factors that she did to find against reinstatement. It is unremarkable that the level of misconduct would have resulted in that finding. It's unremarkable that there would have been significant doubts, as the Commissioner stated, over Mr Brown's appreciation of the gravity of his actions, bearing in mind his answers in cross-examination and his demeanour in his termination of employment interview.

PN150

And of course there was a statutory requirement to consider his short period of employment. There is, with respect, your Honours and Commissioner, nothing in the decision of Commissioner Cargill that would, with respect, attract any appellate intervention. The appeal should be dismissed.

PN151

JUSTICE GIUDICE: Thank you Mr Cross. Mr Joseph?

PN152

MR JOSEPH: Just a couple, your Honour, thank you. Firstly, to the extent that - I'm not sure if I need to say anything further on the question of leave. I have kept it fairly brief, I would hope for clear reasons, but I do rely on what's said in McLauchlan at page 19, in that it is generally understood by the Commission on appeal that it is the existence of an arguable case of legal error or discretion that will found a basis of leave. And I can't really say anything more about the arguable basis of those errors than what I've already said in relation to the failure of the Commissioner, in my respectful submission, to take into account the very relevant, or properly consider that very relevant in her own decision, there being that there was no valid termination of employment, as well as the other bases that are put in relation to about House v King, being the injustice or unreasonableness of the Commission's decision in that her discretion is carried.

PN153

Now, it's put by Mr Cross that the findings of the dismissal not being unjust or unreasonable are important. In the context that those findings were made they were findings that the conduct had occurred and findings that the policies adopted by the employer were not unreasonable. The point in response to that is that whilst a finding of misconduct is not challenged on appeal, nor is the finding that the misconduct was not bad enough to justify Mr Brown being terminated, that's not challenged by the appellant. In fact it's relied upon by the appellant, and it's not challenged by the respondent.

PN154

Can I say this? Your Honour asked my learned friend a question about the relevance of the finding. Your Honour, the President, asked a question about the relevance of the finding and there being no valid reason for termination. Can I say this? The answer to that question as to the relevance it plays to the appropriateness of reinstatement is not necessary to be found in the statute per se, because obviously it's not written in section 654 in subsections (2) or (3) that he had to take into account whether there was a valid reason for termination. But in taking into account all of the circumstances of the case, my submission, at risk of repeating myself, is that not that it's statutory finding that there be no valid reason for termination, but that in this case whilst there was misconduct, termination wasn't justified. Something short of termination should have occurred. That is the simple finding that should have been a centrepiece in the consideration of whether reinstatement was appropriate.

PN155

And in relation to the comments, my learned friend taking the Commission back through the evidence to show the nature of Mr Brown's conduct both before his termination and certainly the answers he gave in the proceedings, I'd say this. All of that was before the Commission. The Commission saw all of those things and yet it still decided that the misconduct that had occurred was not serious enough to justify dismissal. Those are the submissions in reply.

PN156

JUSTICE GIUDICE: Can I just ask a question about section 654(10) which refers to misconduct?

PN157

MR JOSEPH: Is that question directed at me, your Honour?

PN158

JUSTICE GIUDICE: It was directed at you Mr Joseph. 654(10) seems to operate on the assumption that in cases of misconduct where there's nevertheless a finding that termination was harsh, unjust or unreasonable, or a combination of those, there might be a remedy less than reinstatement. So that's the first implication of 654(10).

PN159

MR JOSEPH: It's a point of reference though to the question being considered therein, which is the level of compensation. If the legislature had have particularly wanted misconduct to be a matter taken into account in relation to the consideration of the approach of a submitted statement, then one would have thought given that point of reference it could have easily been referred to.

PN160

SENIOR DEPUTY PRESIDENT KAUFMAN: Yes, there's another reference to it in subsection (8) as well.

PN161

MR JOSEPH: Yes, thank you, your Honour, I had seen that. Again there's a reference there specifically in relation to the amount of - and that's clearly compensation because obviously the back pay is dealt with in subsection (4). So had that been a matter of particular relevance, in my submission it would have been specifically referred to.

PN162

MR CROSS: The position of the respondent, section 10 clearly does refer to a determination of the question of moneys, but it's mere presence indicates that in circumstances where the termination may have been harsh, unjust or unfair, that it is not then ordinarily a consideration of reinstatement. There may also be a consideration of compensation but that necessarily there must be a reduction when one looks at the gravity of that misconduct.

PN163

JUSTICE GIUDICE: Yes, all right. Thank you gentlemen for your submissions. It won't be possible to give a decision today so we shall obviously have to reserve our decision. Thank you for your submissions. We'll publish a decision as soon as we can. We'll now adjourn.

<ADJOURNED INDEFINITELY [11.26AM]