Peter Rudolf Hemmert v Australian Paper [1996] IRCA 45

DECISION NO: 45/96 CATCHWORDS INDUSTRIAL LAW - UNLAWFUL TERMINATION - RESIGNATION - Employee resigned conditionally, on the happening of a future event. Employer had option to do nothing, and wait. When that event occurred, the resignation thereupon became effective - A resignation, although reluctant, may nonetheless be an act of free will. Industrial Relations Act 1988 ss 170EA, 430 Mohazab -v- Dick Smith Electronics Pty Limited, (unreported, IRCA No. 625/95, 28 November 1995) PETER RUDOLF HEMMERT -v- AUSTRALIAN PAPER No. NI 1746 of 1995 COURT: PATCH JR PLACE: SYDNEY DATE: 19 JANUARY 1996

INDUSTRIAL RELATIONS COURT OF AUSTRALIA NEW SOUTH WALES REGISTRY No. NI 1746 OF 1995 BETWEEN: Peter Rudolf HEMMERT Applicant AND: AUSTRALIAN PAPER Respondent REASONS FOR JUDGMENT (Delivered ex tempore - revised from transcript) 19 JANUARY 1996 PATCH JR This is an application under section 170EA of the Industrial Relations Act 1988 ("the Act"), together with a claim under section 430 of the Act, in the associated jurisdiction of the Court, for "unpaid wages and other entitlements including unpaid sick leave and holiday pay for period 1.9.94 to 30.12.94". As a preliminary issue, it is necessary to determine this question: did the applicant submit a conditional resignation which became effective when the trustees of the applicant's superannuation fund approved his claim for a total and permanent disability payment? The burden of proof is on the applicant to prove that his employment was terminated at the initiative of the respondent. The applicant suffers from epilepsy. For many years that condition was well-controlled by medication such that the effects upon him were relatively minor. However in 1994 his condition deteriorated. The medical evidence establishes that a significant factor in the deterioration of the applicant's condition was the fact that he was working shift work at the Botany mill of the respondent, working as a supervisor. The applicant suffered a severe seizure in February 1994 and from that time he no longer attended for work. There is no question that this was done in anything other than in an open way, by way of consultation with his employer. The applicant was paid sick leave, that is to say his full normal salary, up to the end of August 1994. A decision was made by the respondent to cease that sick leave at the end of June, which decision was communicated to the applicant by way of letter dated 22 June 1994. However, that decision was not put into effect, due to administrative error, namely the proper forms not being filled out, until 31 August 1994. As a consequence the applicant was paid his full salary, as sick leave, up until that date. On 4 July 1994 the applicant gave Mr Goble, the mill manager, a letter of that same date. Together with that letter the applicant enclosed a report from Dr Mariese Hely, dated 14 June 1994. The letter that the applicant gave to Mr Goble read as follows, omitting the formal parts: "Enclosed is the latest medical advice following my recent hospital admission. Providing the Trustees of our Super Fund concur with my doctor, i.e. "total and permanent incapacity" I am now resigned, most reluctantly, to act on this advice. Please place into motion for resolution my application for total and permanent incapacity." The phrase "to act on this advice" is a reference to a passage in the report of Dr Hely, which report was addressed to Mr Goble. That report, amongst other things, noted that the applicant's condition had worsened, and had worsened in spite of adjustments to medication and trials of new medication. It referred to concern regarding safety in the work place. The final paragraph of that letter reads as follows: "Because the frequency of the epilepsy has recently increased and has now occurred without warning, in spite of more aggressive attempts to manage it, he has been advised to retire from work. It is unlikely that he will be able to return to work in the future." The phrase in the applicant's letter to Mr Goble "to act on this advice" is a reference to the phrase in Dr Hely's letter "he has been advised to retire from work". Furthermore, Mr Hemmert himself gave evidence of, not only the letter which he gave to Mr Goble, but also a conversation that he had in handing over that letter. He said - and this is found on page 9 of his statement which he stated in his evidence to be true - to Mr Goble on that date, 4 July 1994: "I intend to apply for total and permanent incapacity benefits under the Superannuation scheme. I will resign if such benefits are approved by the Trustee." In his oral evidence before me the applicant gave evidence to the effect that he told Mr Goble that he would accept Dr Hely's advice and he said that both in the letter he gave him and verbally. Importantly, in my opinion, in cross-examination the applicant said this: "I considered that my employment with APM had ceased when I received approval from the Trustees for the total and permanent disability payment." In my opinion the applicant had submitted what could be characterised as a conditional resignation. In other words, he had informed his employer of his intention to revoke the contract of employment, making that revocation conditional upon a future event occurring. This left his employer with a number of options, one of them being to do nothing and wait for that event to occur. That is exactly what they did. That event having occurred, the applicant's resignation thereupon became effective. The Trustees of the Superannuation fund made their decision to approve the total and permanent disability payment on 2 December 1994. The applicant's resignation thereupon became effective and his employment was terminated, by his act, on that day. Counsel for the applicant submits that the applicant's resignation should be regarded nonetheless as a termination of employment at the initiative of the employer. He referred me to the case of Mohazab -v- Dick Smith Electronics Pty Limited, (unreported, IRCA No. 625/95, 28 November 1995). On page 15 of that judgment the Court said this: "It is necessary for present purposes to concentrate on the expression "termination at the initiative of the employer", as that expression is central to the operation of Division 3 of Part VI of the Act. Accordingly, it cannot be assumed that decisions concerning other legislative formulations or cases concerning constructive dismissal are to be applied without qualification when considering the provisions of Division 3. However, industrial tribunals and courts have long accepted that an employee who resigns from his or her employment can and should be treated as having been dismissed by the employer if the dismissal is one where the employee did not resign willingly and, in effect, was forced to do so by the conduct of the employer." The question then is: Was the applicant forced to resign by the conduct of his employer so that it could be said that he did not resign willingly? Even though the applicant was reluctant to adopt the course which he did, that does not mean that his conditional resignation was not a willing act. People in many situations will reluctantly do something, but that nonetheless is an act of free will. The matters to which counsel for the applicant pointed me as suggesting that the applicant was forced into his resignation or, as counsel put it, "railroaded", are these: Firstly, there was little or no consideration of alternatives for the applicant. That is to say alternatives in which his condition would not be worsened and his safety would not be at risk. Secondly, the applicant was notified on 22 June 1995 that his paid sick leave was to be withdrawn and that this decision was made without consultation with the applicant. No doubt the applicant was unhappy about his situation and as he expressed it "reluctant" to adopt the course that he did, but in my opinion neither of these actions (or omissions) - assuming they occurred - constituted improper pressure on the applicant to resign. Nor does the cumulative effect of those actions of the respondent on the applicant amount to a pressure such that it could reasonably be said that the applicant was forced to resign unwillingly, as a result of the conduct of the employer. It follows that the applicant has not proven that there was a termination of his employment at the initiative of the employer. The principal application under section 170EA will be dismissed. I reserve for further argument if necessary the question of the applicant's claims in the associated jurisdiction of the Court and the matter will be listed for callover, unless the parties can reach agreement in the meantime, before me at 9.30 am on 6 February 1996. Note: On 6 February 1996, the court having been informed that the remaining matters in controversy between the parties had been settled, an order was made dismissing the application. I certify that the preceding four (4) pages are a true copy of the Reasons for Judgment of Judicial Registrar Patch. Associate: Caroline Sternberg Date: 20 February 1996 APPEARANCES Counsel for Applicant: Mr Robert Reitano Solicitor for Respondent: Mr Anthony Woods, Henry Davis York Solicitors