DECISION NO:168/97 CATCHWORDS INDUSTRIAL LAW - Review of decision of Judicial Registrar - whether termination was at the initiative of the employer - opportunity to consider implications of conduct Workplace Relations Act 1996 s170DC, 170DE, 377 Perrin v Des Taylor (1995) 58 IR 254 No. AI 1025R of 1996 MARK WAYNE POWER v SEOVIC CIVIL ENGINEERING PTY LTD MOORE J CANBERRA 23 MAY 1997 IN THE INDUSTRIAL RELATIONS ) ) COURT OF AUSTRALIA ) No. AI 1025R of 1996 ) ACT DISTRICT REGISTRY ) BETWEEN: Mark Wayne POWER Applicant AND: SEOVIC CIVIL ENGINEERING PTY LTD Respondent JUDGE: Moore J PLACE: Canberra DATE: 23 May 1997 ORDER OF THE COURT THE COURT ORDERS THAT: 1. Order 2 of the orders of the Judicial Registrar of 30 September 1996 be varied by substituting for the sum of $5,000, the sum of $750. NOTE: Settlement and entry of orders is dealt with in Order 36 of the Industrial Relations Court Rules. IN THE INDUSTRIAL RELATIONS ) ) COURT OF AUSTRALIA ) No. AI 1025R of 1996 ) ACT DISTRICT REGISTRY ) BETWEEN: Mark Wayne POWER Applicant AND: SEOVIC CIVIL ENGINEERING PTY LTD Respondent JUDGE: Moore J PLACE: Canberra DATE: 23 May 1997 REASONS FOR JUDGMENT In February 1996 an application was made by Mr Mark Power under s 170EA of what was then called the Industrial Relations Act 1988 ("the Act"). The application alleged that Mr Power's employment with Seovic Civil Engineering Pty Ltd ("the employer") had been terminated in contravention of provisions of the Act and a claim was made for compensation. The application was heard and determined by a Judicial Registrar who, on 30 September 1996, ordered the employer to pay Mr Power damages pursuant to s 170EE(5) in the sum of $1,340.00 and compensation pursuant to s 170EE(3) in the sum of $5,000.00. These amounts were awarded because the Judicial Registrar concluded that the employment of Mr Power had been terminated in contravention of s 170DE(1) and s 170DC of the Act. The employer sought a review of the determination of the Judicial Registrar under s 377 of the Act. The review is a hearing de novo. At a directions hearing on 28 February 1997, I was informed by the solicitors appearing for the parties that agreement had been reached that the transcript of the evidence-in-chief of witnesses who gave evidence before the Judicial Registrar would constitute evidence-in-chief in the review and that any witness required for cross-examination would be made available for that purpose. In addition, the employer proposed to call additional witnesses and statements would be provided of their evidence before the hearing. When the hearing of the review commenced on 24 April 1997 it was evident there was a misunderstanding on the part of counsel appearing for the employer concerning the use that might be made of the transcript. He was under the impression that the transcript of the evidence, including cross examination, would be evidence in the review. This had particular significance in relation to the evidence of a Mr Hall who was not available to give evidence afresh in the review. In the review, evidence was led from three witnesses. The employer called Mr Peter Tsenkas who was the foreman supervising the work of Mr Power on 17 February 1996. That was the day his employment concluded. The employer also called Mr Maurice Booth, who, on that day, had been working near Mr Power. Mr Tsenkas did not give evidence before the Judicial Registrar, as he was then overseas, nor did Mr Booth. There was agreement reached during the review that the evidence-in-chief and cross examination of a Mr Roberts, who was the site supervisor, would form evidence in the review as would the evidence of Mr Hall as it concerned events before and after 17 February 1996 but not as it related to that day. This aspect of the agreement is of some significance as it was on 17 February 1996 that Mr Power and Mr Tsenkas had a critical conversation in Mr Hall's presence. There was a material divergence between Mr Tsenkas' account and Mr Power's account of what was said. The review proceeded on the basis of that agreement. There was broad agreement between Mr Tsenkas and Mr Power about the events of that day and, in many respects, the evidence of both was uncontentious. From it the following emerges. Mr Hall and Mr Power had been directed to do work on a construction site on which a road was being constructed with a concrete base. It was necessary for Mr Hall and Mr Power to drive a truck towing a compressor to a point on the partially completed road to drill holes in the concrete road base. This they did. When they arrived they found the compressor was low on diesel. However the truck they were driving had on its tray a 1000 gallon tank of diesel fuel. They thought that the easiest way of transferring fuel from the tank to the compressor was, in the circumstances, to use another vessel to transfer the fuel. This was necessary because the hose in the tank could not reach the compressor while the compressor remained hooked up to the towball on the truck. Mr Power asked Mr Hall to go and speak to Mr Tsenkas, who was working some distance from them, and get from him a jerry can to use to transfer the fuel. Mr Hall went and spoke to Mr Tsenkas. He returned and informed Mr Power that Mr Tsenkas would not give him a jerry can. Mr Hall told Mr Power that he had been instructed by Mr Tsenkas to unhook the compressor from the back of the truck and move the truck alongside the compressor so that it could be refuelled directly from the tank using the hose. Mr Power decided to go and see Mr Tsenkas himself to get a jerry can. This he did. What was said by each when he asked for a jerry can was a matter of some controversy which I return to shortly. Mr Power then returned to the truck. On the way back he spoke with Mr Booth. While Mr Power could not recall having this conversation, Mr Booth gave evidence about it. That evidence was not challenged and I accept it. Mr Power said to Mr Booth as he walked past words to the effect "I'm fucking quitting" or "I fucking quit. I'm going". Mr Booth gave evidence that Mr Power returned to the truck, proceeded to get his gear out of the truck as if to leave but then apparently changed his mind and moved over to the compressor. Mr Booth described this as Mr Power having "a change of heart". The evidence is somewhat unclear as to what happened when Mr Power returned to the truck. Mr Power said in chief that he and Mr Hall started to unhook the compressor and refuel it when Mr Tsenkas arrived. There was no issue that Mr Tsenkas arrived at some point after he had had the conversation with Mr Power about providing a jerry can. Mr Power's evidence before the Judicial Registrar had been that they had unhooked the compressor, pushed it to a place where they could get the truck beside it, backed the truck up and refuelled the compressor. They had then hooked it back onto the truck and towed it back to where they were to commence working. It was then, according to Mr Power's evidence before the Judicial Registrar, that Mr Tsenkas came up to them and had the critical conversation. When giving evidence in the review, Mr Power was only prepared to say that he thought they were trying to get the compressor off the truck to refuel it when Mr Tsenkas arrived. It was common ground that the Wednesday after Saturday 17 February 1996, Mr Power returned to the site and spoke to Mr Tsenkas, in the company of Mr Roberts, about working again for the employer. Mr Power accepted in evidence that Mr Tsenkas said to him "Why did you swear at me and tell me to get fucked?" and that Mr Tsenkas also said "If you don't know you should go and see a doctor." Mr Power's account of the first conversation with Mr Tsenkas, when he sought a jerry can to transfer the fuel, was that Mr Tsenkas told him "you can't have a jerry can" and to disconnect the compressor from the back of the truck. Mr Power said that, at that time, Mr Tsenkas had three empty jerry cans in his truck. Mr Power said he responded by saying: "It's to heavy to unhook by myself as it didn't have a jockey wheel". Mr Tsenkas replied by saying he should "go up and do as you're told". Mr Power said they then had an argument though he did not detail what was said. Mr Power did say, however, that they were swearing at each other. Mr Tsenkas' account of this conversation is that Mr Power came up and said that he needed a jerry can to which Mr Tsenkas replied: "I don't have the jerry can. I have one half full of petrol". Mr Power responded by telling him to "empty the petrol can". Mr Tsenkas replied by saying: "No, you do what I say to you. Unhook the compressor and reverse the truck." Mr Power, according to Mr Tsenkas, then became cranky and started to swear at him telling him to "get fucked" and calling him a "prick". Mr Tsenkas also said Mr Power indicated he would "go home". I should at this point say that Mr Tsenkas was not fluent in English and his account of conversations was given in a fairly simple and somewhat disjointed way. Again, differing versions emerged in the evidence about the conversation Mr Power and Mr Tsenkas had sometime later. It was at the conclusion of this conversation that Mr Power left the construction site believing he had been sacked by Mr Tsenkas. He said as much to Mr Roberts later that day, as was corroborated by Mr Roberts in the evidence he gave before the Judicial Registrar. That is, Mr Power said at the truck he had been sacked by Mr Tsenkas. Mr Power's version of what occurred was that Mr Tsenkas came up and said words to the effect of: "Why didn't you do it this way in the first place, what's wrong with you, are you sick in the head?" Mr Power then said that an argument ensued between them and they both swore at each other. A point was reached when Mr Tsenkas then said: "leave the site" to which Mr Power replied: "am I sacked?". Mr Tsenkas responded by saying: "yes". At one point Mr Power gave evidence that Mr Tsenkas said: "fuck off, off the site" rather than "leave the site". Mr Tsenkas' account of this conversation was that he approached Mr Power and Mr Hall and said words to the effect that they should have done it this way in the first place. According to Mr Tsenkas this gave rise to a response from Mr Power: "Do it yourself. I'm going home. You're a fucking prick". Mr Tsenkas then said: "Stay working for the company, listen to the company". Mr Power responded by saying: "You sacked me". A variant of the last element of this conversation, emerging from the evidence of Mr Tsenkas in cross-examination, was to the effect that Mr Power said: "You sacked me", to which Mr Tsenkas replied: "I don't sack anybody. You sacked yourself". Mr Power presented as a young man who was powerfully built and likely to be assertive. Mr Tsenkas was considerably older and quite frail in appearance. He did not give his evidence in a forceful way. One significant difference between Mr Tsenkas' account and Mr Power's account of the two conversations they had was that, according to Mr Power, Mr Tsenkas swore at him. This was denied by Mr Tsenkas. Mr Booth gave evidence that Mr Tsenkas had never sworn at him and he had never heard Mr Tsenkas swear in front of him. That this is so is consistent with Mr Tsenkas' demeanour and the general impression I gained from observing him in the witness box. I think it is likely that in the conversations that they had Mr Tsenkas did not swear at Mr Power. To this extent I reject the evidence of Mr Power about what passed between them. I also think it is unlikely that Mr Tsenkas would have refused to give Mr Power a jerry can had one been available. I can conceive of situations where a foreman would doggedly insist upon a task being performed in the way the foreman wished, even though there was another and easier method of doing it. In such a case a foreman would be asserting authority for authority's sake. However Mr Tsenkas did not strike me as a person who would have conducted himself that way. I think it is probable that there was only one jerry can on Mr Tsenkas' truck and it contained petrol. I also think it is likely that Mr Power was extremely reluctant to refuel the compressor in the way suggested by Mr Tsenkas. Indeed I think it is likely that Mr Power insisted that Mr Tsenkas provide the jerry can he had by emptying the fuel that was in it. Mr Tsenkas' refusal to follow this course upset Mr Power. He was young and head strong and became upset by Mr Tsenkas' intransigence. After this first conversation he returned to the truck and compressor in a state of anger or at least acute irritation with Mr Tsenkas. That is why he said what he did to Mr Booth. What happened at the truck when Mr Tsenkas arrived later is harder to distill from the evidence. It is common ground that Mr Tsenkas said something to the effect that Mr Hall and Mr Power should have done the refuelling in the way he proposed from the outset. Mr Power's account of what happened is plausible except to the extent that he alleges Mr Tsenkas swore. It is not an account accepted by Mr Tsenkas. However Mr Tsenkas' account has aspects which I find difficult to accept. It is entirely plausible that having been told that he should have done it in the way initially proposed, Mr Power's anger, which was by then abating, flared up again. What Mr Tsenkas said was, in the circumstances, provocative. Thus it is plausible that Mr Power then said to Mr Tsenkas words to the effect that: "Do it yourself; I'm going home, you're a fucking prick". However, had this been said the probable result would have been that Mr Power would have simply gathered up his bag and left. In those circumstances Mr Tsenkas may well have said something to the effect that Mr Power should stay working with the company. However Mr Tsenkas' evidence was that at this point Mr Power said something to the effect of: "You sacked me". That, in my opinion, is a statement that is entirely disconnected with the preceding conversation as recounted by Mr Tsenkas. On Mr Tsenkas's account there could be no suggestion that anything he had said might constitute, or be reasonably viewed as, him sacking Mr Power. That being so, there would be no basis for Mr Power indicating that he then believed Mr Tsenkas had sacked him. In my opinion, it is likely that something was said by Mr Tsenkas that Mr Power understood to be words of dismissal. However I think it is unlikely that Mr Tsenkas told Mr Power to leave the site, at least in the language that Mr Power indicated was used, viz: "Fuck off, off the site". It is unlikely that the conversation evolved in the way suggested by Mr Power, namely, that having been told to leave the site, Mr Power asked: "Am I sacked" to which Mr Tsenkas replied "yes". Whatever happened is likely, in my opinion, to have been less direct and more opaque. I think it is probable that in the heat of the exchange that they doubtless had, something was said that lead Mr Power to believe that Mr Tsenkas was indicating he was sacking him. However I accept the evidence of Mr Tsenkas that at some point in this conversation, proximate to the time when Mr Power suggested he had been sacked, Mr Tsenkas said: "I don't sack anybody, you sacked yourself". While the notion of someone sacking themselves is, in a literal sense, a curious one, I accept that it is a type of statement that Mr Tsenkas might be likely to have made. It was, in my opinion, probably intended to be a reference to Mr Power's earlier conduct. That is, whatever Mr Tsenkas had said that led Mr Power to believe he was being sacked or was being asked to leave the site, was viewed by Mr Tsenkas as a direct response to the petulant conduct of Mr Power. I accept that probably one factor that ultimately influenced Mr Power to leave the site was the anger he felt towards to Mr Tsenkas for having initially insisted upon the job being done the way he had wanted it done coupled with Mr Tsenkas making what I earlier described as a provocative statement when he came up to the truck when Mr Hall and Mr Power were in the process of refuelling the compressor. However, the dominant factor influencing Mr Power's conduct was his belief that he had been dismissed. As I earlier mentioned, Mr Power gave evidence, which was corroborated by Mr Roberts, that he later said to Mr Roberts, as he was leaving the site, that he had been sacked. Thus Mr Power's belief that he had been sacked as a result of his conversation with Mr Tsenkas continued. In my opinion, it is likely to have been a belief genuinely held by Mr Power. That is, the statement to Mr Roberts was not a contrived statement for some ulterior purpose. I have concluded that there was a termination of Mr Power's employment at the initiative of the employer. Things were said to Mr Power that led him to believe he was being dismissed. He made this belief known to his immediate supervisor and the supervisor on the site. Neither, and particularly the former, insisted that he was wrong and should remain. It is true Mr Tsenkas said something about remaining at work but I think that it is probable that he was quite glad to be rid of Mr Power and was content that he acted on his belief that he had been sacked and this influenced the degree to which he tried to show that Mr Power was not being dismissed by him. If, as Mr Tsenkas asserted in evidence, he had no authority to dismiss Mr Power, then this is likely to have been known to Mr Roberts who did nothing to stop Mr Power leaving the site believing Mr Tsenkas had terminated his employment. While the matter is not free from doubt, I consider, on balance, that Mr Power has established there was a termination of his employment at the initiative of the employer. However the employer had, in my opinion, a valid reason for the termination having regard to Mr Power's conduct: see s 170DE(1). He had twice had an abusive exchange with the site foreman. That, in itself, is not an unknown occurrence on a building or construction site. However that first abusive exchange was in the context of what I believe was a dogged refusal on Mr Power's part to do a job in the way directed by the foreman. Mr Power was refusing to accept the foreman's authority. It may be accepted that, as Mr Booth described it, Mr Power had a change of heart. But that does not lessen the effect of his earlier conduct which, in my opinion, provided a valid reason for his dismissal. This leads to a consideration of whether there had been a contravention of s 170DC as contended by counsel for Mr Power. His termination occurred, or at least was initiated, in the heat of the exchange with Mr Tsenkas. There appears to have been no opportunity given to Mr Power to consider the implications of his conduct before the termination occurred. The purpose of s 170DC was described in Perrin v Des Taylor Pty Ltd(1995) 58 IR 254 at 256-7 : "Its purpose is at least twofold. It is to give the employee the opportunity to demonstrate that the allegations have no foundation in fact or they should not be viewed as reflecting on the employee's capacity... A second purpose of s 170DC is that an employee with whom an allegation has been raised may be able to persuade the employer that, while the allegation is of substance, there are factors that should persuade the employer not to terminate the employment. They may be extenuating personal circumstances or they may involve undertakings about future conduct." This opportunity was not, and should have been, given to Mr Power. Earlier counselling pointed to by the employer was not, in my opinion, sufficient to satisfy s 170DC. The question of whether compensation should be awarded now arises. Compensation should be awarded but, in my opinion, it should be nominal. Had s 170C been complied with, Mr Power may have remained in employment with the employer. However he may still have had his employment terminated on 17 February 1996. If it was not terminated then, he may have continued to conduct himself in the same way and his employment terminated later or he may have left the job himself. In any event the availability of work was diminishing and the prospect of medium-term employment with the employer was limited. I propose to award compensation under s 170EE(3) in the sum of $750 and I will vary the order of the Judicial Registrar to reflect this conclusion. I see no basis for disturbing the order for damages under s 170EE(5). I certify that this and the preceding fifteen (15) pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Moore. Associate: Alexandra George Dated: 23 May 1997 APPEARANCES Counsel for the Applicant: Ms A Tonkin Solicitor for the Applicant:Reed & Co Counsel for the Respondent: Mr R.S. Warren Solicitor for the Respondent: Goodwins Dates of Hearing: 24 April 1997 Date of Judgment: 23 May 1997