Grellman v Chiron Pty Limited [1996] IRCA 567

DECISION NO:567/96 IN THE INDUSTRIAL RELATIONS COURT OF AUSTRALIA AUSTRALIAN CAPITAL TERRITORY DISTRICT REGISTRY AI 1059 of 1996 MARGOT ANNE GRELLMAN Applicant CHIRON PTY LIMITED (A.C.N. 008 525 433) trading as WODEN ANIMAL HOSPITAL Respondent Coram: Judicial Registrar Linkenbagh Place: CANBERRA Date: 12 November 1996 REASONS FOR JUDGMENT (Delivered ex tempore and revised from the transcript) This is an application pursuant to the provisions of section 170EA of the Industrial Relations Act 1988, in which the applicant seeks a remedy in respect of the termination of her employment by the respondent. The employment commenced in November 1984, and concluded in May 1996. The applicant was employed as a Veterinary Surgeon and the basis of her employment was that she worked 15 hours a week on each of three days for five hours per day, and she was paid at the rate of $27.50 per hour. Exhibit A indicates that the actual hours worked by the applicant were subject to some minor variations from time to time, depending upon the need for the hours to be varied on an ad hoc basis. The evidence for both parties confirms that there was no difficulty with the work performance or conduct of the applicant at all, and relations between the parties, being the applicant and Mr McDonald, who is the principal of the respondent, were very good until March 1996. The case for the respondent is that there was no termination of the employment at its initiative, and that therefore this application should fail. The case for the applicant is that relations between the parties soured when she raised the issue of her entitlement to Long Service Leave early in 1996. The applicant's evidence is that when she made a request for such leave, Mr McDonald appeared amazed and told her, in effect, that she need not come in and that he had another vet who wanted work. On the Wednesdays between 10 April and 22 May, the applicant was not required to work and on Friday, 17 May and 24 May she was not required to work. She did in fact work on 25 May and I will return to the circumstances of that later in these reasons. The record of employment, which is exhibit A, covers the period from 12 July 1995 to 29 May 1996, and apart from a period of two weeks in December and the days to which I have referred, exhibit A indicates that the applicant worked her agreed number of hours on almost every day in that period. The applicant's submission is that the respondent reduced her available hours of work as a direct consequence of her claim for Long Service Leave, which was disputed, and is still being disputed in proceedings before the Magistrates Court. The respondent submits that the reason for the reduction in the available hours of work was that there was a reduction in the volume of work coming into the practice. The evidence in relation to that is insufficient in my view. There was an attempt to bring evidence of the diary entries and appointments for days during the period and I discouraged that evidence on the basis that, taken out of context, it would be of little weight. There was no evidence of any downturn in the income of the practice or other financial matters affecting the practice, and I am not satisfied that there was a need, based on the operational requirements of the practice, for the reduction in the availability of work to the applicant. The significance of the timing of the demand for Long Service Leave and the commencement of the alleged reduction in the availability of work certainly is a factor in my determination today. On 18 May, without prior consultation with the applicant, Mr McDonald presented her with a letter, which is exhibit D. The applicant, in her statement, which is exhibit F, and in her oral evidence, says that the letter, which outlines a new full time position for a Veterinary Surgeon in the practice, was presented to her and there was a conversation between her and Mr McDonald. Her evidence is that that conversation was to the effect that her existing job was to be replaced and that that the full time job was to take its place and that there was then some discussion about the terms of the letter. Those terms require the incumbent of the position to reside in a flat at the practice and to be available for work of 35 to 40 hours a week and provide for a salary which is, on an hourly basis, roughly half of the hourly rate which was then being paid to the applicant. The applicant told the Court that she told Mr McDonald that she had family responsibilities which would preclude her from taking up the position. Another reason was that the flat which is referred to was, on the applicant's description unsuitable. She was not cross-examined as to her description of the flat, and there was no other evidence adduced on behalf of the respondent to counter her evidence that it was very basic and hardly in keeping with the status of the position and certainly not suitable as a residence for the applicant and her husband. The applicant's evidence is that she concluded from that conversation that Mr McDonald's attitude was one of "apparent finality" and that she formed that view partly because Mr McDonald made it clear to her that he had someone else in mind who could take up a full-time position as described in the letter. She agreed in her evidence that Mr McDonald gave her about a period of six days, until 30 May, to think about the proposal. Mr McDonald's recollection of that conversation is imprecise and he admitted that he cannot remember the content of the conversation in any detail. I am inclined in relation to the credit of these two parties generally, to accept the versions of events related to the Court by the applicant. She had good reason to remember the content of conversations and the details of her contact with Mr McDonald at that time and she has given her evidence in detail, contrasted to the poor recollection of Mr McDonald. The applicant made her application to the Australian Industrial Relations Commission on 21 May and on 22 May, Mr McDonald had his receptionist telephone the applicant to inform her that there would be no work for her that day, which was a Wednesday. The respondent attempted to make something of the content of that conversation. The applicant at first could not recall the conversation with the receptionist, Miss Knight, but after Miss Knight gave evidence the applicant informed the Court that she did recollect the conversation. Miss Knight's memory of the terms of the conversation was vague. She did not give evidence of precise words used and agreed that the applicant may have said to her, not that she had been fired, but that there was no position available there for her any longer. Not a lot turns on the telephone conversation of 22 May. Its greatest significance is that it was a telephone conversation for the purpose of informing the applicant that there was no work for her that day. On 24 May the applicant telephoned Mr McDonald and she confirmed to him that the new job he had offered was unacceptable to her. Her evidence is that there was then some conversation in which Mr McDonald told her that a new vet would be taking up the position in June and that she formed the view during that conversation that Mr McDonald had already made arrangements for the position to be filled by a person other than herself. There is dispute between the applicant and Mr McDonald about other matters in that conversation, in particular about the basis on which the applicant agreed to work on 25 May. Mr McDonald informed the applicant that he had written her a letter but she had not received that letter and Mr McDonald delivered the letter later in the day and there was a further telephone conversation. The applicant's recollection of the content of the two telephone conversations is more detailed than that of Mr McDonald. The applicant says that she agreed to work on 25 May as a sign of good faith and a measure that she was willing to sort out the problems relating to her Long Service Leave and her employment generally. The applicant says that on that day Mr McDonald told her that her employment had been superseded by the new full time position. Mr McDonald denies that he confirmed to the applicant that she had been replaced by a person in the new job and says that he confined his remarks about the alternative employee to the question of that person's acting as a locum in the event that the applicant took two months leave commencing in June of 1996. Mr McDonald gave evidence that the new vet commenced duties on 1 June 1996 and that he is still in employment. The respondent argues that this application must fail because the employment was not terminated at its initiative. The Court cannot agree with that submission. The oral evidence and also the terms of Mr McDonald's letter which is exhibit D do not support that finding. On 22 May, the respondent telephoned the applicant to inform her that there was no work available. That was before the respondent had notice of the present application. The applicant worked on 25 May which is after the date of filing of the application and Mr Wilson submits that because she worked on that date then the employment could not have been terminated prior to that date. I find that this employment was terminated by a constructive dismissal which was effective on 18 May 1996 when Mr McDonald delivered exhibit D to the applicant and had the conversation with her. Exhibit D does not on its face indicate that the part time position held by the applicant was to come to an end but taken with all of the other evidence there is no doubt in my view that that was the clear intention of Mr McDonald on 18 May. The co-incidence of the disputed request for Long Service Leave and the reduction in the number of hours, along with the actions of Mr McDonald in arranging for another employee to commence on 1 June are all factors which support the finding that it was Mr McDonald's intention on 18 May to bring the applicant's employment, as it had existed up to that date, to an end. It is certainly true that there was some discussion about allowing until 30 May for the applicant to consider the matter, but the foreshadowed termination of the employment was clear enough to the applicant on 18 May and she lodged her application in this Court promptly. She gave evidence that she lodged the application with a view to attempting to gain the assistance of the Industrial Relations Commission in sorting out the difficulties. That may have been a motive of hers at the time but certainly her actions and the actions of Mr McDonald clearly indicate to this Court that the applicant's employment, as it was known at that date, was to come to an end very much sooner rather than later. The respondent elected to conduct the matter on the basis of the lack of a termination at its initiative and did not argue the question of whether or not there was a valid reason. There was evidence which tended to go to the consideration of whether there was a valid reason of the termination of the employment. There was certainly no valid reason based on the applicant's performance or conduct. The letter of 18 May uses the words "restructure the organisation". There is insufficient evidence to support any view that there was a genuine restructuring of this practice at the time. The respondent's case was put in submissions on the basis that the applicant's position was not being abolished, but there was a new full time position being created. That submission works against the evidence of Mr McDonald that there had been a downturn in business which justified a reduction in the applicant's working hours. The respondent's arguments are mutually inconsistent. If in fact the respondent had in mind at the time that there was a need for redundancy, it did not engage in the usual procedures, vis-a-vis the applicant, and if it was to be argued that this was a situation of genuine redundancy, then the respondent has failed to meet the requirements of section 170DC of the Act. Since termination of her employment the applicant has been unable to gain further employment. She is aged 58 years and in her eleven or more years of work with the respondent has engaged in a narrow range of the work which a Veterinary Surgeon can do, and she honestly told the Court that she may have some difficulty in adapting her professional role to encompass a wider range of duties. She does not seek reinstatement by this Court. However, whether an applicant wishes to be reinstated is a factor for the Court to take into account but is not a determining factor. In my view in this case reinstatement is the proper remedy. The respondent's case was that it never intended to abolish her job in the first place and that it wished to have her continue to work. The applicant has not been able to obtain further employment and she wishes to work. It is my view that reinstatement is the proper remedy in this instance, and I propose to make the following Orders: (1) that the identity of the respondent is changed to Chiron Pty Limited (A.C.N. 008 525 433) trading as Woden Animal Hospital; (2) that the respondent reinstate the applicant by appointing her to a position on terms and conditions no less favourable than those on which she was employed immediately before the termination of her employment on 18 May 1996; (3) that the applicant's employment shall be deemed to have been continuous on the basis of 15 hours per week and the respondent shall pay to the applicant all remuneration lost by her because of the termination. I certify that this and the preceding 4 pages are a true copy of the Reasons for Judgment of Judicial Registrar Linkenbagh Associate: Renee Cauchi Date: 21 November 1996 The Applicant appeared in person Solicitor for the Respondent: Mr John Wilson Barker Gosling