GERSBACH -V- SOUTH BLACKWATER COAL LIMITED [1997] IRCA 116

DECISION NO:116/97 CATCHWORDS INDUSTRIAL LAW - TERMINATION OF EMPLOYMENT - ALLEGED UNLAWFUL TERMINATION - WHETHER PROOF OF VALID REASON - REMEDY WORKPLACE RELATIONS ACT 1996, s170EA, ss170DE (1) KIM MARIE GERSBACH -V- SOUTH BLACKWATER COAL LIMITED QI96/1150 BEFORE: BOULTON JR PLACE: BRISBANE DATE: 4 APRIL 1997 IN THE INDUSTRIAL RELATIONS ) COURT OF AUSTRALIA ) No. QI96/1150 QUEENSLAND DISTRICT REGISTRY BETWEEN: KIM MARIE GERSBACH Applicant AND: SOUTH BLACKWATER COAL LIMITED Respondent BEFORE: BOULTON JR PLACE: BRISBANE DATE: 4 APRIL 1997 MINUTES OF ORDERS THE COURT ORDERS THAT: 1. The application be allowed. 2. The respondent pay to the applicant the sum of $23,078 within 14 days of this order. NOTE: Settlement and entry of orders are dealt with in Order 36 of the Industrial Relations Court Rules. IN THE INDUSTRIAL RELATIONS ) COURT OF AUSTRALIA ) No. QI96/1150 QUEENSLAND DISTRICT REGISTRY BETWEEN: KIM MARIE GERSBACH Applicant AND: SOUTH BLACKWATER COAL LIMITED Respondent BEFORE: BOULTON JR PLACE: BRISBANE DATE: 4 APRIL 1997 REASONS FOR JUDGMENT Background At all material times, the applicant was employed by the respondent as a miner at the respondent's Kenmare mine outside Blackwater in Central Queensland. The applicant is now aged 29, having been born on 18 December 1967. She commenced employment with the respondent on 5 June 1995. Kenmare is an underground coal mine. The applicant had had previous experience as an underground miner for several years with Mt. Isa Mines Limited. She had also gained a TAFE Certificate in Underground Coal Mining. The applicant last worked for the respondent on 27 June 1996. After that date, she was in receipt of paid sick leave from the respondent. The applicant's employment with the respondent was terminated by it on 13 September 1996. The respondent claimed in effect that the applicant's absence from work since 1 September 1996 was unauthorised. I now turn to an examination of the evidence. I do not purport to traverse all of the evidence in what follows below. Evidence Much of the evidence which I consider to be material in the resolution of this matter was uncontested. It is necessary, first, to make reference to relevant Award provisions. The parties agreed that what was known as the Clause 20 Agreement (deemed to be an Award of the Australian Industrial Relations Commission) governed the employment relationship between applicant and respondent. This agreement made provision for, inter alia, employees' sick leave entitlement. Clause 11.5 relevantly provides: (i) Should an employee be absent from work due to personal illness....., the employer shall continue to make fortnightly salary payments to the absent employee for up to six consecutive calendar months from the date of incapacity. Fortnightly salary instalments will reduce to base salary level after the employee has been absent from work longer than six consecutive calendar months. Payment of salary instalments shall cease when the period of absence extends beyond twelve consecutive calendar months. (ii) For all absences for one shift or longer, because of personal illness....., an employee will be required to provide the team leader with documentation completed by the medical..... practitioner which states the medical practitioner's diagnosis of the illness....., date of consultation and duration of incapacity. Failure to provide this evidence of personal illness.....without good and sufficient reason will result in the absence being declared unauthorised. It was common ground at trial that the applicant had provided the respondent with medical certificates which the respondent accepted as authorising her absence from work until 30 August 1996. Prior to that date, there had been contact between the applicant and the respondent with a view to the applicant returning to work on 7 August 1996 pursuant to a proposed rehabilitation program. The applicant had during the course of her illness engaged solicitors to represent her interests. By facsimile transmission of 6 August 1996, those solicitors had contacted the respondent. That transmission expressed concern that the applicant might suffer a detriment if she returned to the workplace prior to some resolution of what was said to be issues at hand. Briefly, these issues related to the solicitors' proposal to file a complaint on the applicant's behalf with the Anti-Discrimination Commission in respect of treatment allegedly meted out to the applicant by her workmates at the mine. The solicitors' transmission went on to suggest that in the circumstances it would be appropriate for the applicant to remain off work until the parties had an opportunity to confer with a view to reaching an interim agreement on the question of rehabilitation. Within 2 days of that contact, the respondent learnt of the medical certificate which certified the applicant's unfitness for work up to and including 30 August 1996. On the latter date, a Ms Brown, the respondent's rehabilitation coordinator, spoke by telephone with the applicant. She asked the applicant if she would be returning to work the following Monday (30 August 1996 being a Friday). The applicant said no, that she was seeing a psychologist and her solicitor would be making contact with the respondent's solicitors that day. Ms Brown told the applicant that she would still need to present a medical certificate to the respondent if she was not attending work on the Monday. The applicant's solicitors spoke with the respondent's solicitors on 30 August, and confirmed the content of that conversation by facsimile transmission to the respondent's solicitors on 2 September. They confirmed that the applicant had attended upon a Ms Quaife-Ryan, psychologist, who was of the view that the applicant was not fit to return to work at that point. They also advised that the psychologist was completing a report which would be provided to the respondent's solicitors on a without prejudice basis as soon as it was to hand. The applicant's solicitors also referred to the fact that the applicant would be making application for workers' compensation. What next occurred was that the respondent's human resources manager, Mr Tracy, wrote to the applicant direct by letter dated 5 September. That letter pointed out that her most recent medical certificate had expired. Mr Tacy also made reference to the proposed rehabilitation plan for the applicant's expected return to work on 7 August. The letter stated that the applicant had been absent from work since Monday 2 September without authority and without any supporting medical evidence. It required her to provide such evidence to the respondent by 3.00 pm the following day, 6 September, and pointed out that if she continued in breach (of the requirement to provide medical evidence to support her absence from work), the respondent would have to consider her ongoing employment. On 6 September, the applicant's solicitors made contact with the respondent's solicitors by facsimile transmission. That transmission made reference to Mr Tracy's letter. It informed the respondent's solicitors that the applicant's current treating practitioner, Dr Foley, had referred her to a psychiatrist for a consultation on 11 September. It further claimed that Dr Foley had drawn a medical certificate which would be provided (to the respondent) as soon as possible. The applicant's solicitors asserted that the applicant would be unable to provide the certificate by 3.00 pm that day as requested. The solicitors suggested that it would be reasonable for the respondent to authorise the applicant's absence from work. It went on that if the respondent did not wish to take this course and was proposing to terminate the applicant's employment, the respondent's solicitors should advise the applicant's solicitors immediately. Finally, it pointed out that given that there was a current complaint lodged under the Anti-Discrimination Act, the applicant's solicitors were of the view that it would be appropriate for the respondent or its solicitors to direct all concerns ,queries and correspondence to the applicant's solicitors. The applicant's solicitors sent the contents of this transmission by facsimile direct to Mr Tracy as well. Within a few days, Mr Tracy had gone on leave. A Mr Arthur, ordinarily training coordinator with the respondent, became its acting human resources manager from about 10 September. Despite what had already passed between the respondent, its solicitors and the applicant's solicitors, he wrote to the applicant direct on 12 September, advising her that her absence continued to be unauthorised from 1 September. He pointed out that she continued to be in breach of her contract of employment and called on her to show cause why the respondent should not terminate her employment at 3.00 pm that day. The letter required that she produce a medical certificate in support of your application to maintain your employment. Mr Arthur arranged for that letter to be delivered by courier to the applicant and she apparently received it at 11.23 am the same day. Before the 3.00 pm deadline, the applicant's solicitors forwarded by facsimile a letter to Mr Arthur. That letter pointed out that the solicitors had previously advised that the applicant's psychologist had advised that the applicant was not fit to return to work at this stage. The psychologist's report having been received by the applicant's solicitors that day, they enclosed a copy of it for Mr Arthur's information. The letter made reference also to the fact that the applicant had attended upon a general practitioner, Dr Foley, who saw fit to refer the applicant to a psychiatrist on appointment on 11 September. A letter from Dr Foley dated 6 September accompanied the applicant's solicitors' letter. The applicant's solicitors' letter also informed Mr Arthur that due to the illness of the applicant and her husband with influenza on 11 September, the applicant was unable to get to Mackay to keep the psychiatrist's appointment. The applicant's solicitors' letter also took up with Mr Arthur the question of whether or not the applicant was in truth in breach of her contract of employment. It drew Mr Arthur's attention to para 11.5(ii) of the Clause 20 Agreement, and asserted that if there were a failure on the part of the applicant to provide a medical certificate, evidence of good and sufficient reason would provide an adequate excuse. It further asserted that a reference to previous correspondence and the matters raised in the present letter would reveal good and sufficient explanation for the very short delay in providing a certificate. Finally, it pointed out to Mr Arthur that there was no valid reason for the termination of the applicant's employment. The applicant's solicitors also faxed their letter to the respondent's solicitors at or about the time it was despatched to Mr Arthur. Yet again Mr Arthur wrote direct to the applicant the following day, 13 September. His letter pointed out that the applicant continued to be on unauthorised absence from your work since 1 September 1996. Despite our request for a medical certificate in support of your continuing absence, you have not complied with this request. The material supplied to us does not amount to such a medical certificate.......Your employment is hereby terminated. You will be provided with two weeks pay in lieu of notice from today's date. Mr Arthur agreed in cross-examination that there were options available to him other than termination of the applicant's employment. At that time, the applicant had not used up her existing sick leave entitlement. She could have taken annual leave, or leave without pay, to cover the period since expiry of the last medical certificate. Mr Arthur did not at any time seek advice from the respondent's solicitors. He had no reason at any time to doubt the assertions of the applicant's solicitors, in the communications I have referred to. He had the opinion of Ms Quaife-Ryan, the applicant's psychologist (who had seen her as recently as 29 August)that I would consider it a risk to Ms Gersbach's mental and physical health at this stage should she return to this work environment..... He also had available to him Ms Brown's file note of the conversation between the applicant and her on 30 August. Issues On behalf of the respondent it was asserted that the termination of the applicant's employment was for a valid reason, namely her failure to comply with the Clause 20 requirement that she produce a medical certificate which complied with para 11.5 (ii) of that Agreement. It is true that such a certificate was not produced. The document from Dr Foley which accompanied the applicant's solicitors' letter of 12 September to Mr Arthur and the respondent's solicitors stated only above named presented to me the 3 Sept 96 for the first time. She states that she is stressed by her occupation. She will be seen by another doctor 11 Sept 96 for further opinion. I am far from convinced, however, that the termination of the applicant's employment was justified in all the circumstances of this case. It seems rather precious to me for the respondent to effectively ignore the opinion of Ms Quaife-Ryan because she was not in truth a medical practitioner. When Mr Arthur decided to terminate the applicant's employment, he had evidence, the truth and accuracy of which he had no reason to doubt, that the applicant had a continuing unfitness for work. Mr Arthur took the view that only a rigid adherence to para 11.5 (ii) of the Clause 20 Agreement was sufficient. In my view, he ought to have been satisfied that the applicant had shown good and sufficient reason for her failure to provide a medical certificate of the kind contemplated by that paragraph. It is probably not strictly necessary to point out that even if Mr Arthur considered that the applicant's failure to provide the evidence was not attended by good and sufficient reason, he was not obliged even then to terminate her employment. He could have declared her absence unauthorised, and proceeded to apply the procedures detailed in the Kenmare Mine Attendance Management Agreement. Clause 5 of that Agreement provides that where an absence is declared unauthorised, the employee must undergo counselling. Not being satisfied that termination of the applicant's employment was justified in the circumstances of this case, I find that the respondent has failed to prove a valid reason within the meaning of ss 170DE(1) of the Workplace Relations Act 1996 for the termination - Westen -v- Union Des Assurances De Paris NI 2819 of 1995, Madgwick J, 17 December 1996, unreported. In the circumstances, I do not find it necessary to deal with the alternative argument based on para 170DF (1) (a) of the Act. Remedy The applicant seeks reinstatement. The respondent argues that reinstatement is impracticable. The respondent points to the evidence of a Dr Klug, consultant psychiatrist who examined the applicant at the request of her solicitors on 19 February 1997 and who gave evidence at the trial. It was Dr Klug's opinion that the applicant had developed an adjustment disorder with mixed anxiety and depressed mood as a result of various stresses which she experienced in the course of her employment at the mine. He thought the applicant was likely to recover from her remaining emotional symptoms in the near future. Despite this, she is likely to be left with an increased vulnerability to developing anxiety depressive symptoms in response to stresses similar to those she experienced at the mine. Dr Klug expressed the view in his report that the applicant may well be able to return to underground mining at some other mine, once she has recovered from her adjustment disorder. In evidence he appeared to modify this view by adding another mine, and another employer. Ms Quaife-Ryan expressed the view in evidence that it would be a really bad idea for the applicant to go back to work (at this time). On behalf of the applicant it was envisaged that upon reinstatement, she would go back onto sick leave and if still unfit for work once her sick leave entitlement was exhausted, she may have an entitlement to be certified as disabled under the respondent's superannuation scheme. I do not propose to order reinstatement in this case. Assuming for present purposes that it is practicable to reinstate a worker in respect of whom it is known that that worker will not be fit to resume duties at least in the foreseeable future, the circumstances of this case convince me that it would be inappropriate to make such an order. My impression of the applicant herself and of the medical and psychological evidence is such that I consider it not to be in the applicant's best interests health-wise for her to be reinstated. I consider that she is more likely to gain a quicker and fuller recovery by finally severing her ties of employment with the respondent. An order for reinstatement will only expose her to having to comply with the respondent's requirements for medical certificates and the prospect of perhaps undergoing rehabilitation at the instigation of the respondent. It is important, I think, as Dr Klug opines about likely recovery, that she.....no longer have to focus her mind on the events which occurred at the Kenmare Mine. In respect of compensation, I consider it appropriate in all the circumstances of the case that the respondent pay compensation to the applicant. I proceed to assess compensation on the basis that the applicant is likely to have continued in receipt of sick pay had her employment not been terminated. This pay would have reduced to base salary level after the applicant had been absent from work longer than 6 consecutive calendar months. In the period of 6 months that immediately followed the day on which the termination took effect, the amount of remuneration that would have been received by the applicant is the sum of about $23,078.00. Since termination, the applicant has had work as a casual bar attendant and according to the evidence before me has earned $4380 gross from that employment. I assess the applicant's loss, including likely future loss, as being greater than the sum produced by application of the statutory cap. Her prospects of obtaining work in the foreseeable future are not good. Consistent with this assessment, I do not propose to reduce the maximum sum which might otherwise be ordered by the applicant's earnings (including pay in lieu of notice) since termination. Orders I order that: 1. The application be allowed. 2. The respondent pay to the applicant the sum of $23,078 within 14 days of today. I certify that this and the preceding SEVEN (7) pages are a true copy of my Reasons for Judgment. Judicial Registrar: Date: 4 April 1997 Counsel for the Applicant: Ms Ronalds Solicitors for the Applicant: Nall Payne Crasswell Counsel for the Respondent: Mr Murdoch Solicitors for the Respondent: Blake Dawson Waldron Dates of hearing: 20 and 21 March 1997 Date of judgment: 4 April 1997