FEDERAL COURT OF AUSTRALIA INDUSTRIAL LAW - complaint of UNLAWFUL TERMINATION - VALID REASON - whether employee made false declaration and failed to disclose pre-existing injury - SERIOUS MISCONDUCT - whether employee's actions constituted reasonable ground to dismiss without notice - DAMAGES - Workplace Relations Act 1996 ss170DB, 170DC, 170DE(1), 170EA, 170EE General Conditions of Employment (Interim) Award 1995 Kacar v Colorpak Packaging Pty Ltd (unreported, IRCA, Murphy JR, 15 May 1995) Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371. ABONYI -V- AUSTRALIAN POSTAL CORPORATION VI 2215 of 1996 PARKINSON JR MELBOURNE 16 JULY 1997 IN THE FEDERAL COURT OF AUSTRALIA ) ) VICTORIA DISTRICT REGISTRY ) VI 2215 of 1996 ) GENERAL DIVISION ) B E T W E E N: Leah Mary ABONYI Applicant AND: AUSTRALIAN POSTAL CORPORATION Respondent JUDICIAL REGISTRAR : PARKINSON PLACE : MELBOURNE DATED : 16 JULY 1997 MINUTES OF ORDER THE COURT ORDERS THAT: 1. Pursuant to Subsection 170EE(5) of the Workplace Relations Act, 1996, the respondent pay to the applicant the sum of $1036.64 in damages, less any amount deducted on account of PAYE taxation requirements paid to the Australian Taxation Office. 2. Time for compliance is 14 days from the date of this Order. 3. In all other respects the application made pursuant to Section 170EA of the Workplace Relations Act 1996 is dismissed. NOTE: Settlement and entry of orders is dealt with by Order 36 of the Federal Court Rules IN THE FEDERAL COURT OF AUSTRALIA ) ) VICTORIA DISTRICT REGISTRY ) VI 2215 of 1996 ) GENERAL DIVISION ) B E T W E E N: Leah Mary ABONYI Applicant AND: AUSTRALIAN POSTAL CORPORATION Respondent JUDICIAL REGISTRAR : PARKINSON PLACE : MELBOURNE DATED : 16 JULY 1997 REASONS FOR JUDGMENT This is an application made pursuant to Section 170EA of the Workplace Relations Act 1996. The respondent employed the applicant as a postal worker in 1988. In 1990 the applicant left the employment of the respondent to take up employment elsewhere. On 18 June 1990 the applicant was injured in the course of that employment and had entitlements to ongoing compensation and rehabilitation assistance. During the period June 1990 to January 1994 the applicant was receiving medical and rehabilitation assistance. In January, 1994 the applicant was engaged by the respondent to work on a casual basis at the respondent's Greensborough branch, on account of absences from that branch. She performed mainly sorting duties, although she did some driving and delivery duties as needed. The applicant worked for the respondent on a casual basis for approximately 2 months. On 17 February, 1994 the applicant applied for a permanent part time position with the respondent. That position was offered to her subject to satisfactory completion of medical fitness requirements. It was also a position offered subject to completion of a probationary period. The applicant completed the necessary medical report forms and attended for a medical examination. As a consequence of her answers in the forms and the medical examination, the applicant was eligible for permanent appointment to the respondent and she was appointed on a probationary basis to the permanent position. In about July, 1994 her appointment as a permanent employee was confirmed. The applicant remained in the position until the termination of the employment. On 4 May, 1995 the applicant, in the course of her duties delivering mail, fell and sustained an injury, including aggravation of a previous injury. The applicant reported the injury and received treatment. She was absent from work on account of the injury for a period of time. In the course of the progression of her workers compensation entitlements, the applicant was asked by the respondent's workers compensation officer to complete documentation in relation to the injury. The applicant completed the claim material and in the course of doing so, disclosed her previous injury and workers compensation claim. As a consequence of this disclosure, further investigations were made by the respondent in June, 1996, as to its liability for the injury to the extent that it was a pre-existing injury. The respondent ceased liability on the claim at that time partly as a consequence of the applicant not having disclosed the pre-existing injury at the commencement of the employment, on the medical disclosure forms and partly because it contended that the injury sustained in the course of the employment with it had resolved. The applicant's area manager was informed of her failure to disclose her pre existing injury and further information as to the reasons why ongoing workers compensation benefits had been refused. On 13 June, 1996 the respondent's manager, Mr Bill Wilson, decided that the applicant's conduct warranted review, pursuant to the respondent's disciplinary process. It was his view that the applicant was guilty of serious and wilful misconduct, on account of her failure to disclose her medical status on the employment application form. His evidence was that he formed this view because such conduct was seen as serious by the operational arm of the business and also because of the costs incurred by the respondent, as a result of the current workers compensation claim. I also understood his evidence to be that he and others in the respondent believed the applicant was wrongfully in continued receipt of workers compensation benefits, after commencing full time employment with the respondent. It is appropriate to note that there is no evidence in these proceedings to establish that there was any conduct on the part of the applicant which was wrongful or calculated to obtain or retain workers compensation benefits of any kind wrongfully and such material as was presented to the Court was inadequate to found any such allegation. I am satisfied that Mr Hose did not take this matter into account in determining to terminate the employment. On 14 June, 1996,the applicant was suspended from her employment and informed there would be an inquiry into her conduct. She was told the reason for the suspension. By letter dated 14 June, 1996, (Exhibit R4), the applicant was notified that there was to be an inquiry into her conduct, in that she provided a false declaration on her application for employment and pre-employment medical examination details and that she failed to disclose pre-existing conditions, for the purpose of obtaining employment with the respondent. The time and place for the inquiry was specified. It appears from the extract of the General Conditions of Employment (Interim) Award 1995, ('the Award'), provided to the Court, that the process of inquiry is established by way of internal procedures. There is no specific Award provision identifying an inquiry process, nor was any material provided to the Court to identify any relevant regulations in this regard. The inquiry was conducted by Mr Walters, an area manager of the respondent. At that interview the applicant's failure to disclose the pre-existing injury was raised. She explained the failure as an omission or oversight. The recommendation of the delegate was that the employment should be terminated. This recommendation was accepted by Mr Hose, the Regional Manager and by letter dated 25 June, 1996, (Exhibit R6), he advised the applicant that her employment was terminated. Mr Hose's decision was confirmed by a board of reference constituted pursuant to the Award. I shall address the question of s170DC later in this decision, however I turn first to consider the operation of ss170DE(1) of the Act. Subsection 170DE(1) It is not in dispute in these proceedings that the applicant suffered from a pre-existing injury when she commenced the employment with Australia Post. Further it is not in dispute that the applicant failed to disclose that injury at the time she filled out the application form for a permanent position. There is no evidence of the respondent as to what its response would have been in the event that the form had been accurately completed. The applicant's explanation to the Court for her failure to disclose the pre-existing injury was that she believed that she no longer suffered from the injury and that she had misread the disclosure form, understanding it to require disclosure only of current conditions. Her evidence was that it was an omission as a consequence of failing to properly read the document, rather than a deliberate attempt to mislead the respondent. On balance, after lengthy consideration of the competing factors, I am satisfied that the respondent, in the particular circumstances of this case, had valid reason to terminate the employment of the applicant. I make this finding because I do not accept that the applicant's omission was entirely as a result of failure to understand or properly read the medical report questionnaire. I accept that medical report form, (Exhibit R1), might reasonably be the subject of misunderstanding by an employee or prospective employee and may result in an unintentional, but inaccurate or even automatic negative response, in particular in relation to Part 2, questions 1 to 69. However I do not accept that such a response or mistake is likely to have occurred, in this case, in relation to Part 3 of the document. This is because the applicant did not merely tick the relevant or appropriate box, or insert a standard yes or no answer, rather she actively supplied information and entered detailed information which was incorrect and misleading to the respondent. The inaccurate and misleading information entered was of a type which could not reasonably be explained by reference to the applicant's understanding that the questions were not directed to historical incidents. At point 3 in the form the applicant was asked the question: " During the past 5 years have you ever had any medical examination, advice or treatment, attended or been admitted to hospital for treatment or had any tests such as X-Ray or electrocardiogram ? " The form then sought details of the doctors and clinics consulted. The applicant's response to that question was to tick the box marked "NO". However she then went on to inform the respondent that; "I have no Doctor". The evidence, including the applicant's own material, establishes that this is an inaccurate and misleading statement and that the applicant must have been conscious of this fact at the time the statement was made. The applicant had been receiving ongoing medical treatment and rehabilitation assistance to the point of her returning to casual employment in early 1994 and from the same treating doctor, Dr Jory. This doctor also continued to treat the applicant after she sustained the injury with the respondent. The correspondence from Dr Jory, tendered by the applicant in the proceedings, (Exhibit A2), identifies that the applicant had been a patient of the doctor for 10 years. The evidence establishes that the omission on the part of the applicant was not merely as a result of oversight or misunderstanding and it is clear having regard to the nature of the applicant's duties, that it was a significant omission in that it deprived the respondent of the opportunity to make reasonable inquiries or examination as to the applicant's fitness to perform the duties. On that basis I am satisfied that the respondent had valid reason to terminate the employment. However it is relevant to note that in my view not every circumstance where there had been an omission or inaccuracy, even of a fundamental kind, on the part of an applicant for employment, would warrant termination of employment. I did not understand the decision of Murphy JR in Kacar v Colorpak Packaging Pty Ltd, (unreported, IRCA, Murphy JR, 15 May 1995), referred to by the respondent, to stand for such a proposition. In a circumstance where there is an innocent omission or inaccuracy, it would be relevant to consider all of the circumstances, including the nature of the omission, the actual affect or impact on the respondent of the omission, the evidence of the respondent as to whether it would have employed the applicant even had it known of the matters omitted, the length of time of the employment and the circumstances in which the omission became known. In this case the applicant was already in the employment of the respondent as a casual employee prior to completing the medical questionnaire and had been for some time. The respondent's case was deficient in relation to evidence and submissions on these matters. However in view of my finding as to the nature of the omission and the circumstances in which it was made, together with the evidence as to the type of work undertaken by the applicant, I am satisfied on balance that the decision to terminate the employment was defensible and was not capricious in the sense discussed by Northrop J in Selvachandran v Peteron Plastics Pty Ltd (1995) 62 IR 371. Section 170DC I turn now to consider the operation of s170DC. In the circumstances I am satisfied that the applicant had adequate opportunity to be heard in relation to the allegations made against her. Whilst s170DC does not provide for any particular formality, the respondent adopted a process which it had been utilising for some time, that of instituting an inquiry. It is apparent from that process that the decision maker is not the person who hears the applicant's version or explanation of events. Rather he considers the materials and the recommendation of the inquirer and then decides what disciplinary action should be taken. Mr Hose was the person who decided to terminate the applicant's employment, however he did so upon the recommendation of Mr Walters and having regard to the matters inquired of by Mr Walters and the information provided by him. He did not interview the applicant personally. In response to matters raised by the Court, Mr Hose identified the information and matters which he took into account in deciding to terminate the employment and I am satisfied that this material did not go beyond the information which was received by Mr Walters and included the applicant's version of events. Mr Walters was not called to give evidence in the proceedings, as to the procedure used by him in interviewing the applicant or the matters raised by him with the applicant or taken into account by him in reaching the conclusion, that the appropriate disciplinary action to be recommended was termination of the employment. However the applicant's evidence satisfies me that, during the course of the interview with Mr Walters, she was given an opportunity to speak in response to the allegations and to put matters on her own behalf. I am on balance satisfied that the applicant was accorded an adequate opportunity to be heard in compliance with the requirements of s170DC. However it should be noted that a procedure such as that utilised by the respondent in this case, which involves a decision being made by a person not a party to the inquiry and with no direct communication with the employee concerned, is fraught with danger. In such circumstances, if the entirety of the applicant's version of events or other relevant information as to the circumstances had not been relayed to the decision maker by the inquirer, compliance with s170DC may be more difficult to establish. I have considered the issues that arise from the operation of s170DB of the Act and in the circumstances, having regard to the fact that the applicant was employed by the respondent as a casual employee for a period of time prior to any inquiries being made of her as to her medical fitness, together with the work then being performed by the applicant, and the injury having resolved, I am not satisfied that the circumstances were such that it would have been unreasonable to require the respondent to continue the employment of the applicant for the period of the notice provided by s170DB of the Act. I do not accept that issues of mail security are issues reasonably raised by the respondent in the context of this provision and nor do I accept that there was any basis to suggest that the applicant would, given her excellent previous work performance, have acted improperly in the course of any notice period. Consequently the respondent is liable for in damages to the applicant pursuant to ss170EE(5) for an amount equivalent to 2 weeks wages on account of the failure by it to make payment in lieu of notice upon termination of the employment. The amount of the damages ordered will be $1036.64, less any amount deducted on account of PAYE taxation requirements paid to the Australian Taxation Office. The application will, in all other respects, be dismissed. I certify that this and the preceding eight (8) pages are a true copy of the Reasons for Judgment of Judicial Registrar Parkinson. Associate : Dated : 16 July 1997 APPEARANCES The Applicant in person. Officer of the Respondent in person : Mr. T. Butler Date of hearing : 1 July 1997