C A T C H W O R D S INDUSTRIAL LAW - TERMINATION OF EMPLOYMENT - claim of UNLAWFUL TERMINATION - whether RESIGNATION or termination - REMEDY INDUSTRIAL RELATIONS ACT 1988 Ss 170EA, 170EE Mohazab v Dick Smith Electronics Pty Ltd (IRCA No. 221 of 1995, Wilcox CJ, unreported). MICHELLE YVONNE MARTIN -v- CITY OF BUNBURY - WI95/1308 BEFORE: R D FARRELL JR PLACE: PERTH DATE: 4 DECEMBER 1995 IN THE INDUSTRIAL RELATIONS ) COURT OF AUSTRALIA ) WESTERN AUSTRALIA ) DISTRICT REGISTRY ) No. WI 95/1308 BETWEEN: MICHELLE YVONNE MARTIN - Applicant AND: BUNBURY CITY COUNCIL - Respondent MINUTE OF ORDERS BEFORE: R D FARRELL JR PLACE: PERTH DATE: 4 DECEMBER 1995 THE COURT DECLARES THAT: 1. The termination of the employment of the applicant contravened Section 170DE of the Industrial Relations Act 1988 AND THE COURT ORDERS THAT: 2. The respondent shall pay to the applicant compensation in the sum of $13,470 within 14 days of the date of this order. NOTE: Settlement and entry of Orders is dealt with by Order 36 of the Industrial Relations Court Rules IN THE INDUSTRIAL RELATIONS ) COURT OF AUSTRALIA ) WESTERN AUSTRALIA ) DISTRICT REGISTRY ) No. WI 95/1308 BETWEEN: MICHELLE YVONNE MARTIN - Applicant AND: BUNBURY CITY COUNCIL - Respondent BEFORE: R.D. FARRELL JR PLACE: PERTH DATE: 4 DECEMBER 1995 REASONS FOR JUDGMENT This is an application under Section 170EA of the Industrial Relations Act 1988 for compensation arising from the alleged unlawful termination of the employment of the applicant, Michelle Yvonne Martin ("Mrs Martin"), by the respondent, the Bunbury City Council ("the City"). Reinstatement is not sought. Mrs Martin was an employee of the City's Recreation Centre, as a Swimming School Coordinator. The City initiated an investigatory procedure upon receiving an allegation from the parents of a young female patron that Mrs Martin had accused their daughter of having an affair with Mr Paul Olsen ("Mr Olsen"), a fellow employee of the City's Recreation Centre. This process culminated in Mrs Martin's resignation. Having considered all the evidence presented in relation to the original allegation, I am far from satisfied that it had any foundation, and accept Mrs Martin's evidence as to what it was she said which gave rise to the allegation. Even had the allegation been made out, I find it difficult to accept that it could constitute a valid reason for dismissal for the purposes of Section 170DE of the Act. The only real issue, therefore, was whether Mrs Martin's employment was brought to an end by a termination at the initiative of her employer. Whether Termination at the Initiative of the Employer Mr Kennedy, who appeared for the City, contends that Mrs Martin orally resigned of her own volition at a meeting with Mr Richard Green and Mr William Carlsen on Friday, 3 February 1995. Mr Kyle, who appeared for Mrs Martin, contends that Mrs Martin resigned her employment on Wednesday, 8 February, 1995, in the face of a threat from the City to dismiss her summarily for gross misconduct, and that this constituted a termination at the initiative of the employer. Having considered all the evidence, I am satisfied that Mrs Martin did not resign until Wednesday, 8 February, 1995, and the circumstances in which that resignation was procured were such that it constituted a dismissal at the initiative of the employer. I find that Mrs Martin had not decided to resign at the conclusion of her meeting with Mr Green and Mr Carlsen on 3 February, 1995, but that the possibility had been raised with her and she was considering it. I accept Mrs Martin's evidence that she was told she would "have to go", and I accept that they discussed the time-frame within which any resignation would take effect. The reason Mrs Martin was considering resignation was that it would permit her to negotiate a later finish date, so that she could complete her current swimming course. The alternative of summary dismissal, which she believed she faced, would have meant disruption to her students. Mrs Martin said she was told to have made a decision by Monday, so that her resignation could be announced at the following Tuesday's staff meeting. While it was not her intention to resign at the 3 February meeting, it would appear that Mr Green and Mr Carlsen formed the expectation at that meeting that she would resign the following Monday, or perhaps even formed the view that she had already resigned. It is possible she said something which was interpreted by them as a resignation. In any event, had Mrs Martin said something at that meeting which objectively conveyed an intention to resign, then I find that any such resignation would have been given under duress, and in the heat of the moment. Mrs Martin's actions on the next working day, Monday, 6 February, 1995, should have unambiguously conveyed to the City's management at the next opportunity that it was not her considered intention to resign, albeit that she did not believe she had resigned. Faced with Mrs Martin's expressed wish to remain in employment, having considered her position over the weekend, the reaction of Mr Green and Mr Carlsen was surprising. Their reaction was not to accept that she did not wish to resign, resume the investigation process and follow it to its conclusion, as one might expect given their evidence that she was a good and valued employee. Rather, they chose to adopt the position that she had already resigned and that they would not permit her to withdraw her resignation. This reaction tends to support the evidence of Mrs Martin and Mrs Anderson that Mr Green and Mr Carlsen in the earlier interviews were "driving towards 'see ya Michelle'" (as Mrs Anderson vividly put it in her notes of the first interview: Exhibit A11). The resignation was something they had wanted from the outset. I can only surmise that their motivation was a sympathy for Mr Olsen's position. Mrs Martin recalls Mr Green saying at the second meeting on 3 February that "Mr Olsen's worried about his credibility in the workplace, so you can go". It is clear that written confirmation of an oral resignation is not necessary for the resignation to have effect: Mohazab v Dick Smith Electronics Pty Ltd (IRCA No. 221 of 1995, Wilcox CJ, unreported). However, I am satisfied that Mr Green and Mr Carlsen were aware that Mrs Martin had not actually conveyed a decision to resign on Friday 3 February, or at least that the position was ambiguous. This resulted in additional pressure being placed on Mrs Martin to extract a written resignation. She was given an ultimatum to either submit a written resignation by the deadline or be dismissed. The most clear evidence that this was their agenda is the fixing of a deadline for the getting of legal advice at the meeting with Mr and Mrs Martin on 7 February, 1995. As Mr Kyle put it in cross-examination, if there was no ultimatum, and Mrs Martin had already resigned, then why did there need to be a deadline for the Martin's to obtain legal advice? No satisfactory answer was ever given to this question by the Council officers. In assessing the evidence, I found Mrs Martin to be a credible witness in all respects, subject to some shortcomings in recall, and the possible transference on occasions in recollection of the events of one meeting to another. I accept without reservation the evidence of Felicity Anderson and Mr Martin. I prefer the evidence of Mrs Martin to that of Mr Green and Mr Carlsen as to the meeting of 3 February, notwithstanding that Mr Green and Mr Carlsen collaborate each other. I do so on the basis that I am satisfied that their evidence was unreliable in connection with the earlier meeting on 2 February, where Mrs Anderson does not support their contention that Mrs Martin offered her resignation, and also unreliable as to the later meeting on 7 February, where I accept Mr Martin's evidence that the City's officers fixed a deadline of 5pm the following day by which Mrs Martin would have resigned or been dismissed. Mr Green was far from spontaneous in the manner in which he gave his evidence. He appeared to regard cross-examination as a battle of wits, rather than an opportunity to give more complete evidence. He was wary, and at times unresponsive and evasive. While Mr Carlsen's evidence was more open, and he was more ready to volunteer evidence unhelpful to the City's case, where his evidence conflicted with that of Mrs Anderson, Mr Martin or Mrs Martin, I prefer their evidence. Remedy It was common cause that reinstatement was impracticable. It was agreed between the parties that the applicant earned $13,629.28 in the period from 11 March to 21 September 1994, and that the equivalent period of the previous year was the most relevant yardstick for the Court in assessing what the Applicant would have earned in the 6 months following her dismissal, for the purposes of the limitation imposed by Section 170EE(3), given the seasonal nature of her work. I accept that the applicant earned only $159.65 after expenses from her activities following her employment with the City, so that the maximum sum I am able to award is therefore $13,470. I am satisfied that the loss to the applicant resulting from the breach of the Act exceeds that sum. Having regard to what was likely to have happened if the Act had not been breached, I am satisfied that Mrs Martin had secure employment with the City, that her work was valued and that she was very likely to have remained in employment with the City, had she not been forced to resign. I am satisfied that she had no pre-existing intention to start her own swimming courses independently of the City. Nor do I believe that any tension with Mr Olsen would have led to Mrs Martin leaving the City's employment. I note that any such tension appears to have been matched by the tension between Mr Olsen and Ms Anderson, and Ms Anderson remains employed by the City as Pool Manager. I see no basis upon which I should award less than the maximum sum. Accordingly, I award compensation in the amount of $13,470.00. I certify that this and the preceding five pages are a true copy of the Reasons for Judgment of Judicial Registrar R.D. Farrell. Associate Date: Counsel for the applicant: Mr P. Kyle Solicitors for the applicant: Kyle & Co Counsel for the respondent: Mr J. Kennedy Solicitors for the respondent: Minter Ellison Northmore Hale Hearing dates: 9, 10 & 13 October 1995 Judgment date: 4 December 1995