DECISION NO:200/97 CATCHWORDS INDUSTRIAL LAW - Termination of Employment - Review of Decision of Judicial Registrar - Whether employment terminated for valid reason Industrial Relations Act (1988) Victoria v Commonwealth (1996) 138 ALR 129 Jones v Dunkel (1959) 101 CLR 298 Lek v Minister for Immigration (1993) 43 FCR 100 Hurskin v Australian Jewish Press Pty Ltd (1996) 69 IR 123 Brooks v Panalpina World Transport Pty Ltd (unreported, Industrial Relations Court of Australia, 25 March 1997, Patch JR) Patterson v Newcrest Mining Limited (unreported, Industrial Relations Court of Australia, 6 June 1996, Wilcox CJ) Nicolson v Heaven and Earth Gallery Pty Ltd (1994) 1 IRCR 199 Anthony Smith & Assoicates Pty Ltd (1996) 67 IR 240 May v Lilyvale Hotels (1995) 68 IR 112 Davis v Portseal Pty Ltd (unreported, Industrial Relations Court of Australia, 10 April 1997, Full Court) Ware v O'Donnell Griffin (Television Services) Pty Ltd [1971] AR(NSW) 18 San Remo (Southland) Pty Ltd v Farrell (1987) 22 IR 291 Otto Waste Industries Pty Ltd v Klajman (1985) 34 IR 361 Robinson v Roxburgh & Alexander Pty Ltd t/as Power Price (1988) 25 IR 1 Comdox (No. 272) Pty Ltd t/as Ronald Stead Golf v Dawson (1993) 49 IR 458 N E I Pacific Ltd v Nicholl (1994) 53 IR 355 Prichard v Krantz (1983) 5 IR 437 Cliffs Road River Iron v Seamen's Union of Australia [1974] LBC Current Review 200 Merchant Service Guild of Australia v J Fenwick & Co Pty Ltd (1993) LBC Current Review 5 Byrne v Frew Australian Airlines Ltd (1995) 185 CLR 410 Ray v Radano [1967] AR(NSW) 471 Poletti v Ecob (No. 2) (1989) 31 IR 321 Electrical Trades Union of Australia, Nsw Branch v Boral Hardies Pty Ltd (1993) 51 IR 412 Hyslop v Liverpool Hospital (1987) 21 IR 192 Richards v Vinlon Pty Ltd (1971) 18 FLR 422 Con-stan Industries of Australia v Norwich Winterthur Insutance (Australia) Ltd (1986) 160 CLR 226 Hackshalls Ltd v McDowell [1930] AR(NSW) 620 Furnace Demolishers Case [1960] AR(NSW) 670 Metropolitan Meat Industry Board re Collective Responsibility [1972] AR(NSW) 80 Re Federated Ironworkers' Association of Australia NSW Division and Australian Fetilizers Ltd Re Overtime [1977] AR(NSW) 17 Sullivan v Comalco Aluminium Ltd (1985) 10 IR 237 No. NI 1279R of 1995 LOGAN v OTIS ELEVATOR COMPANY PTY LTD MOORE J SYDNEY 20 JUNE 1997 IN THE INDUSTRIAL RELATIONS ) ) COURT OF AUSTRALIA ) No. NI 1279R of 1995 ) NEW SOUTH WALES DISTRICT REGISTRY) BETWEEN: Peter LOGAN Applicant AND: OTIS ELEVATOR COMPANY PTY LTD Respondent JUDGE: Moore J PLACE: Sydney DATE: 20 June 1997 ORDER OF THE COURT THE COURT ORDERS THAT: 1. The matter be adjourned to enable the applicant to bring in short minutes to give effect to these reasons for judgment. 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. NI 1279R of 1995 ) NEW SOUTH WALES DISTRICT REGISTRY) BETWEEN: Peter LOGAN Applicant AND: OTIS ELEVATOR COMPANY PTY LTD Respondent JUDGE: Moore J PLACE: Sydney DATE: 20 June 1997 REASONS FOR JUDGMENT Introduction On 16 February 1995 Mr Peter Logan filed an application under s 170EA of what was then entitled the Industrial Relations Act 1988 ("the Act"). Mr Logan alleged that his employment with Otis Elevator Company Pty Ltd ("Otis") had been terminated on 8 February 1995 in contravention of provisions of the Act. That application was ultimately heard and determined by a Judicial Registrar who concluded, in reasons for judgment published on 30 October 1995, that the termination of Mr Logan's employment was not for a valid reason of the type referred to in s 170DE(1) of the Act, and went on to express the view that, had it been necessary for him to determine the matter, the termination was also in contravention of s 170DE(2). This last provision is not a valid law of the Commonwealth and need not be considered further: see Victoria v Commonwealth (1996) 138 ALR 129. The Judicial Registrar did not order reinstatement but awarded compensation of $20,000. By notice of motion filed on 17 November 1995, Otis sought a review under s 377 of the Act of the determination of the Judicial Registrar. That application apparently gave rise to further claims by Mr Logan not based on the provisions of Division 3 of Part VIA of the Act. In January 1996, a statement of claim was filed on behalf of Mr Logan which, in its final amended form, alleged a failure to pay him amounts due under of one of two awards and alleged a breach of the contract of employment concerning overtime and notice. Sums aggregating more than $830,000 were particularised in the statement of claim as amounts due to Mr Logan. The amounts said to be due under the award were for overtime worked by Mr Logan and amounts payable to an employee who is liable to be called back to work and/or who is standing by. While it was, for a period, a contentious issue at the trial, it was ultimately determined that judgment should be given on all issues except the quantum of Otis's liability for breaches of any award, if liability is established. The litigation between Mr Logan and Otis has been protracted. The hearing before the Judicial Registrar took four days and the review took seven days. Issues have been ventilated fully if not exhaustively. Six witnesses gave evidence before the Judicial Registrar. Four of them gave further evidence in the review and an additional three witnesses gave evidence in the review. The review proceeded on the basis that the evidence given in the proceedings before the Judicial Registrar, including documentary evidence, would be evidence in the review. This evidence was supplemented by not only further oral evidence but further documentary evidence as well. The Evidence The following narrative describes events leading to the termination of Mr Logan's employment in February 1995. Insofar as Otis contends that a valid reason for the termination existed having regard to Mr Logan's capacity or conduct and its operational requirement, the important years are 1990 onwards. The award and contractual claims made by Mr Logan require consideration of earlier events. Much of the narrative reflects evidence that was not contentious or where the scope of the controversy attending it was limited. If there was conflicting evidence about matters which I viewed as material then I have made findings and generally endeavoured to explain why I have made them. The narrative otherwise reflects findings I have made. (a) Logan's personal circumstances and employment history Mr Logan first worked for Otis in 1968. He commenced an apprenticeship in early 1969 as an electrical mechanic. He obtained good grades and in December 1971 gained a certificate stating that he had completed the electrical mechanics course in the honours grade. Indeed, he was nominated for the apprentice of the year in NSW as an electrical mechanic. He continued working for Otis until mid 1975 when he left to help his father in a trucking business. He did this for approximately two years and then took up employment with Otis again in October 1978. However he left in 1979, because his father had became ill, to work again in the trucking business with a view to winding it up. He recommenced at Otis in February 1980 and worked continuously with Otis until his employment was terminated in February 1995. In 1984 Mr Logan first commenced doing work as a local representative of Otis in the Orange area. I will describe shortly and in more detail what the job of local representative entailed in the Orange area. He initially worked as a local representative on an informal or acting basis relieving the local representative, Mr Sarchfield, who was spending a lot of time on sick leave. Mr Logan worked in the Orange area while still generally based in Sydney and would go to Orange for periods of two or three weeks, and up to six weeks, at a frequency of every one or two months. For the purposes of doing that work he was given an expense account and a car to travel to and around the Orange area. He was then paid a wage and additional payments for overtime worked and for callouts though Mr Logan did not make any claim for overtime except for after hours calls. During this period, when not in the Orange area, he would perform his normal duties in Sydney. To that end, he would commute to Sydney from his home at Morisset by car and train. It would take three hours in travel each way. He was doing this on a daily basis for nine or ten months. Mr Logan was permanently appointed to the position of local representative in July 1985 and he relocated there with his family. He was then paid an annual salary. He said that in approximately 1990 he separated from his wife and two of his three children. They were reconciled in 1991. One of the considerations, as he described it, in the separation was the demands arising from being on call 24 hours a day seven days a week. When reconciliation was effected he gave his family an assurance that he would give them as much attention as he could "taking into account his work position". Mr Logan acknowledged in evidence that the separation affected his work performance and in early 1990 he explained to Otis' service manager for the state the difficulties he was experiencing. As local representative at Orange, the most distant places Mr Logan had to work were Nyngan, Coonamble or Coonabarabran. It would take approximately four hours, from the time a call was received, for Mr Logan to get from his home base at Millthorpe to Coonamble. Millthorpe is 20 to 25 minutes drive to the south-east of Orange. It would also take approximately four hours to get to Nyngan and Coonabarabran. Mr Logan estimated that he spent 35 to 40 percent of his work time travelling to and from units being serviced. Travelling time assumes some significance in Mr Logan's claim for overtime and I discuss the evidence in more detail later in this judgment. The property at Millthorpe he owned was a farm of 58 acres. He bought the property in 1987. Mr Logan said in evidence before the Judicial Registrar that he derived income from it though it ran at a loss. He denied spending a lot of time working on the farm. He also said in February 1995 he had 130 sheep and 10 or 12 cattle on the property and that a farm needed to be 100 acres or more to be viable. Mr Logan said that from his point of view it was purely a hobby farm and a space for his children to enjoy the benefits of a country lifestyle. The extent of Mr Logan's involvement in farming was put in issue in the review. It is a matter I return to later. His office on the farm was in an old railway carriage located away from his home. He had located his office there in order to try and have a break from company business. After his employment with Otis was terminated, Mr Logan set up as an electrical contractor and was competing with companies including Otis providing lift service and maintenance. He decided to do so soon after his employment had been terminated. He had tendered for and won work to maintain lifts at the Cowra District Hospital which were formerly maintained by him when he worked for Otis. That contract was one in respect of which he had prepared a quotation on behalf of Otis when still working for it. When he prepared a quotation on his own behalf he was aware of the contract price he had earlier prepared for Otis. He indicated it was his intention to quote for any maintenance contract including any arising from the expiry of an Otis contract. At the time he gave evidence in the review in October 1996, Mr Logan had formed a company called Logan Lifts Pty Ltd. He was doing sub-contract work for a competitor of Otis, Schindlers Elevators Pty Ltd. It involved doing emergency or callout repair work in the Bathurst/Orange area. He had, by then, secured work with Cowra District Hospital, Coonamble RSL, Central West County Council and the Canobolas Hotel. Three of these were Otis customers. (b) Basis of his engagement The circumstances in which Mr Logan was offered and accepted the position of local representative at Orange was the subject of evidence from Mr Logan, Mr Raymond White and Mr John Bull. In 1985 Mr White was state manager, NSW and ACT and Mr Bull then held a position described as field operations manager, NSW. In an affidavit, Mr White gave evidence that he offered Mr Logan the position of local representative though he could not recall the words of the conversation with Mr Logan. He said that what he could recall is that he put the same conditions to each appointee in the same way. This was done in accordance with procedures in place at the time. He essentially denied saying to Mr Logan, as Mr Logan contended, that he had the job as local representative for as long as he wanted it. Even if this had been said, which it may well have been, it could not reasonably have been understood by Mr Logan as an indication that the job was his for as long as he wanted it irrespective of how he performed it. It is highly improbable that a statement was made that would have been understood in this way in the circumstances. However, I accept that, at the time, Mr Logan may have believed that the position was, subject to satisfactory performance, one he would occupy for a lengthy period. Mr White said he gave Mr Logan a document which was an earlier version of a document in evidence entitled "Duties and Responsibilities Statement - Local Representative" dated June 1986. That document set out in detail the duties and responsibilities of a local representative. In his oral evidence Mr White said the effect of what he told Mr Logan constituted an explanation of the requirements of the position. He said his present belief was that he would have referred to the "salient issues" and the duties and responsibilities statement. He would have clearly spelt out the structure of his salary package. He believed he would have said that Mr Logan was to be a salaried employee and, as such, would not be paid overtime. Mr White said that for the following three or four years while he was state manager NSW and ACT, Mr Logan did not query his status as a salaried employee. In cross-examination Mr White said that it was not expected that the local representatives' routine hours would be 40 per week although there would be call-backs outside the regular working hours, that is, at night time or at weekends. Mr White said this was reflected in the salary though he could not say what hours might be assumed to be worked for the purpose of setting the salary. He added that the payment would include an amount not only for call-backs but for overtime more generally which would include call-backs. In an affidavit, Mr Bull said that while initially relieving Mr Sarchfield, Mr Logan was paid for any callouts or overtime he worked. He said that while he could not recall the words that passed between him and Mr Logan at the time of his appointment as the local representative, the substance of what he had said was that the job required spending considerable time on his own and required a self starter. Mr Bull had earlier been a local representative in the ACT, and he said he related to Mr Logan his own experiences in that position. He said he ran through the "duties and responsibilities statement" referred to earlier. He pointed out that the salary was to compensate him for any overtime, callouts and additional work of the kind. He demonstrated to Mr Logan how to complete a document entitled "weekly report of hours worked by salaried local representative". It assumes some significance in another context. Part of it reads (relevant sections reproduced): OTIS ELEVATOR COMPANY PTY LTD WEEKLY REPORT OF HOURS WORKED BY SALARIED LOCAL REPRESENTATIVE ACTUAL HOURS WORKED (Including travelling Time) Do not include Lunch Hours, Holidays (unless actually working), absence due to Illness, Vacations or other Absence authorized by Local Manager. (Submit Leave Form ZS.671 through Branch Office.) Work 32 each week MON TUE WED THU FRI SAT SUN TOTAL MULT- TOTAL PLE HOURS 1. REGULAR PRODUCTIVE TIME 8 8 8 8 32 x 1 TIME SHEETS (Time tickets prev. submitted) 2. TOTAL NON-PRODUCTIVE TIME x1 (Details below) 3. TOTAL REGULAR TIME 8 8 8 8 x1 4. TRAVELLING OVERTIME TRAVELLING OUTSIDE NORMALL WORKING HOURS 5. PRODUCTIVE OVERTIME ] Time Tickets 2 SUBMIT TIME SHEETS x 1˝ 6. PRODUCTIVE OVERTIME] priviously 2 x 2 submitted 7. GRAND TOTAL HOURS WORKED Lines 3, 4, 5 and 6 DETAIL OF NON-PRODUCTIVE HOURS (Work Identification - New Sales - Service Sales - Construction - Office Routine 0 Collections, ect.) REMARKS OFFICE ROUTINE 8 8 8 hrs/week NEW SALES The italicised parts were completed in pencil by Mr Bull. He said that the purpose of having the local representative fill out "2" in the line relating to "productive overtime" was to ascertain the local representative's work load. He also explained that the line "travelling overtime" was for travel undertaken outside the normal eight hours of regular time. Mr Bull said the purpose of requiring the travelling overtime to be specified was also, it appears, to monitor the workload and to have records of travelling times in case of an accident. Mr Logan denied having been shown a document similar to the "duties and responsibilities statement" or an "earlier version" of it. Whether he was or not is, in a sense, immaterial. I am satisfied that Mr Logan would have known what those duties were. The document contains a detailed description of the duties in a style and format typical of duty statements. Nothing was pointed to in the document as an aspect of the work that Mr Logan did not do, either prior to or after his permanent appointment or as an aspect of the work that he did not understand to be part of the duties of a local representative. Mr Logan denied being told by either Mr White or Mr Bull that overtime was built into his remuneration. However at one point in his cross examination Mr Logan agreed that at the time of his appointment he knew there was no payment for overtime and no payments for callouts. Having made that concession he then sought to resile from it. However while I am not affirmatively satisfied that he was specifically told those matters by Mr White or Mr Bull, given that the conversations took place over a decade before evidence was given about them, I am satisfied that at the time Mr Logan accepted the appointment as local representative he was aware that the salary included an amount intended to compensate for all overtime including callouts. I am also satisfied that those with whom he discussed his appointment and who appointed him had a similar understanding. At one point in his evidence Mr Logan said he did not know, at the time of his appointment, the salary he would be getting though he knew it was more than he had been getting, and $3,000 - $4,000 more. I find it difficult to accept, and inherently unplausible, that he was not aware of what his actual salary was to be. It is probable he was told, and thus knew, what his salary was going to be. (c) The nature of Mr Logan's job as local representative - an overview Mr Logan described the duties of a local representative as servicing and maintaining lifts, elevators and escalators for Otis and as being on 24 hour call to do repair work to deal with emergency breakdowns. A small portion of the work he did involved the installation and assembly of lifts and escalators. Mr Logan estimated that 90-95 per cent of his work was maintenance and repair. There was no real issue about what, generally, were the duties of a local representative. From Mr Logan's description of his job, and the evidence more generally, the following emerges as the work he had to do. A local representative was, generally, solely responsible for the repair and maintenance of units in his area which Otis had contracted to repair and maintain. The local representative was required to establish a personal and working relationship with a customer to help maintain the custom. An amount of administrative work had to be undertaken to account in a written form for work done and for expenses incurred, including purchases made. A local representative would engage sub-contractors and negotiate a price for work they would undertake. The local representative was also required to identify and pursue business opportunities for Otis. Again this required the processing of documents by a local representative. In NSW, there was not only a local representative based in Orange but also one based at Coffs Harbour, Port Macquaire, Wollongong and Wagga. There are three documents in evidence that further illustrated the nature of the work of a local representative. The first was the June 1986 duties and responsibilities statement referred to earlier. The second was a document of indeterminate date which has the appearance of a marketing brochure describing Mr Logan's job. It was created when Mr Ross Gardiner was manager, Newcastle and Northern NSW, and Mr Logan's supervisor, which was December 1991 to October 1994. The third was a draft statement of duties created in July 1994 by Mr Gardiner based on a job description prepared in April 1994 for a local representative in Rockhampton. They generally accord with Mr Logan's description of his job. During periods of annual leave, a mechanic was assigned to Mr Logan's area to relieve him. On one occasion, in either 1992 or 1993, Mr Logan had to assist the relieving mechanic doing repair work at the Nyngan RSL. He also used to receive calls about work during periods of annual leave. There was a slight divergence in the evidence about the number of units Mr Logan was responsible for in the Orange area. I am inclined to accept Mr Logan's evidence, I have no reason to doubt it, that in 1985 there were approximately 54 and the number had climbed to 59 or 64 during 1994. However even on Mr Logan's account, the number of units in his area was comparatively constant during the period he worked there from 1985 onwards. A unit could be an escalator, elevator or a small service lift, such as a dumbwaiter. Mr Logan said there had been an increase in the pressure from Otis in the way the local representatives had to deal with the company's business. He said his workload had increased partly, though a very small part, as a result of the increase in the units he was responsible for from 54 in 1985. Those units in the Orange area were located in 13 places. Apart from Coonamble, Nyngan and Coonabarabran, which I mentioned earlier, they were located at Orange, Bathurst, Lithgow, Dubbo, Cowra, Parkes, Jenolan Caves and Young. The preponderance were in the first three towns just mentioned. The routine maintenance required would vary from a fortnightly, to a monthly, to a quarterly service. Mr Logan said that timesheets he prepared recording time he worked were false and that was expected by Otis. He had been told by his immediate superior to put 40 hours on the timesheet even if he had worked 80 hours. Mr Logan gave evidence about the frequency with which he was called out after hours. Apart from one site at Blaney where Mr Logan had, he said, been called out every night for a period, he said he would be called out after working hours half a dozen or a dozen times a year. The time Mr Logan worked is a matter I return to later in these reasons for judgment. Mr Logan accepted that between 1990 and February 1995 he had been spoken to by various members of management on a number of occasions about his performance. I discuss this matter in more detail shortly. Mr Logan said he was not aware of any complaints about his work for his first five years in Orange from September 1985. In these proceedings Otis did not suggest any basis for complaint existed before 1990. Mr Logan said that except for one or two occasions when audits of his work were not particularly good, general satisfaction was expressed about his technical ability. Generally Otis did not suggest otherwise about his technical ability in the review proceedings. Mr Logan also agreed that at meetings with members of management, they had criticised his administrative ability. Mr Logan said he believed the main complaint was the level of his T sales, a type of sale effected by local representatives which I discuss shortly, and that the sales were, on several occasions, below the budget target that had been set for the year. (d) Evidence about work performance - 1990 At this time and until 1 December 1991, local representatives in NSW reported directly to the service manager, NSW and the ACT. In 1990 it was Mr Bob Nott. The work performed by a local representative was the subject of periodic review or assessment. Documents concerning two systems of review were in evidence. The first was a system of annual performance appraisal. I discuss that form of review in relation to Mr Logan's work performance in 1991. The second was a periodic quality audit of a limited number of units undertaken by an Otis employee described as a field quality auditor. The process of audit involved the random selection of units, their inspection and evaluation and a score being determined for matters such as cleanliness or the mechanical or functional operation of the lift. The audits were conducted annually and had been conducted in Mr Logan's area since 1986. An audit was undertaken in the Orange area on 26 March 1990. Six units were audited. The report, to Mr Bayliss, then the state manager, NSW and ACT, contained the following: "The results were - Service Routines Adjustments 86.4 86.3 Average 86.4 Construction Installation Adjustments 100 97.2 Average 98.6 Observations - Service The majority of sites visited were of excellent standard with the exception of the Post Office at Orange which was slightly lacking in routines. This observation is prompted due to the high standard achieved for this and previous audits. Observations - Construction The installation visited at Government Offices, Orange was excellent with only some minor adjustments lacking. All concerned with the job should be congratulated." and later: "Conclusion It is obvious that Otis is well represented in the areas visited this trip. The quality of service offered to our customers is high and commitment shown by all personnel, very encouraging." It is not entirely clear to me from the evidence what is comprehended by the headings "Routine" and "Adjustments" though the former is generally a reference to routine maintenance and the latter a reference to adjustments made to units by the local representative. To place in context the results of the March 1990 audit I should refer to audits done in the Orange area in the period 1987 - 1989. The results in a tabular form were: Routines Adjustments Total (Area average) (Area average) September 1987 85.2 82.8 84 July 1988 84.2 90.4 87.4 March 1989 82.8 83.0 82.9 The results of the 1989 survey were sent to Mr Logan with a note: "This is a bit down on last years report, I guess it is only one job. Anyway, still a very good result..." While the 1990 audit report did not contain the following note it appeared in the 1987, 1988 and 1989 audit reports: "Standard Ratings: 0-50 POOR 50-69 FAIR 70-84 AVERAGE 85-94EXCELLENT 95-100 OUTSTANDING" With two qualifications, evidence was not led to establish that between 1985 and 1990 inclusive, the work done by Mr Logan was deficient either in relation to his technical performance, his co-ordination and time management of his work or the administrative work he was required to do. The first qualification concerns evidence given before the Judicial Registrar by Mr Christopher Manion, who was the administration and personnel manager of Otis between 14 May 1990 and 1 August 1992. He gave evidence that he first became aware of problems with Mr Logan's performance probably around August 1990. He indicated this arose from discussion with the service manager, NSW and ACT and the state manager. He added that he thought there had been a visit from the service manager, NSW and ACT to the Orange area and that "also we had had some administration paper work type problems". This is generally consistent with evidence given by Mr Logan that his separation from his wife affected his work performance and that in early 1990 (he could not recall the date) he spoke to the service manager, NSW and ACT about his difficulties so that if there was any correspondence about it, the service manager, NSW and ACT would have been aware of Mr Logan's position. The second qualification concerns evidence given by Mr Logan concerning T sales. T sales were contracts for repairs, necessitated by change to the code regulating the operation of lifts, to make cosmetic changes to a unit or minor refurbishment to update technology. Such sales involve additional work outside the contractual obligation of Otis to maintain a particular unit. In 1985 the T sales budget was about $6,000 and progressively increased thereafter to $37,000. Between 1986 and 1989 inclusive Mr Logan had been well over budget in the T sales he made but in 1990 slightly under. However there had been a dispute about whether certain business done by Otis should be attributed to the T sales of Mr Logan at about this time. It concerned an upgrading of lifts at the Wallewerang Power Station. It was a job valued in the vicinity of $56,000. Mr Logan expected it to be attributed to his T sales though he was not sure whether it would be for 1990 or 1991. It was a sale ultimately attributed to the "Sydney budget", though this was contested by Mr Logan. It was characterised as an S-sale which is a sale involving a major modification. It is unnecessary to resolve this issue of detail as the material evidence, in relation to T sales, is Mr Logan's performance in 1993 and 1994 and immediately preceding his termination. (e) Evidence about work performance - 1991 In December 1991, as a result of a management restructure, Mr Logan began reporting to the manager, Newcastle and Northern NSW, Mr Gardiner who was based in Newcastle. Before dealing with specific matters concerning Mr Logan's performance during 1991, I should refer to one document, and related material, concerning his work generally. I earlier referred to two methods of periodic review or assessment of a local representative. The first mentioned was an annual performance appraisal. In 1991 there was such an appraisal of Mr Logan's work undertaken by Mr Nott who was then Mr Logan's immediate superior. This was, it appears, the first year they were undertaken. I will set out the completed form in full as I will later refer to entries in similar surveys made in 1992, 1993 and 1994. The italicised section reproduces the typed entries made on a standard form: Staff / Specialist Performance Appraisal Name: PETER LOGAN DIRECTIONS: Indicate present performance in the context of the skill requirements of the position, achievement of key objectives and execution of other duties and responsibilities, assuming that yourevaluation is based Title: LOCAL REPRESENTATIVE only on job-related aspects ofperformance. See sheet 3 for rating information Unit: ORANGE SKILL Out Exc Good Satis Marg COMMENTS IN SUPPORT OF ASSESSMENT PLANNING X Peter in 1992 is going to set the planning procedures in place so that paperwork arrives for processing in time. Job procedures, route schedule etc. Ability to set objectives and creatively adapt strategies, policies and procedures for achieving them. DECISION MAKING X As a Local representative most Ability to define problems, decisions are made without develop and assess alternative assistance & Peter is more than capable in this area. solutions and select the best alternative. CONTROLLING X Actions will be taken in 1992 to Ability to measure against planned performance standards and to take corrective action to ensure that events coincide with plans. ensure planned performance standards are met, and corrective procedures are in place. COMMUNICATING X Needs to keep customers better informed in written form, requests internally for assistance/advice are satisfactory Ability to inform and influence others by clear and concise exp- ression of ides and information in verbal and written form. WORK COMMITMENT X Peter's ability, experience, Ability to affirm and demonstrate a knowledge of the equipment is dedication of resources and time excellent, needs to manage his on the job. time a little better. WORKING WITH OTHERS X No real problems in this area on the rare occasions he has to communicate with his peers. Well respected for his practical ability Ability to motivate, to develop a rapport and to earn the respect and trust of others Summary Appraisal: ¨Outstanding ¨Excellent ¨ Good ý Satisfactory ¨ Marginal Comments: With an unsettled year behind him, we hope that 1992 will see a marked improvement in the area. Recommended by Date Employee Review Date Approved by Date INTERVIEW WITH EMPLOYEE l EMPLOYEE RESPONSE: (The manager should write in this space a summary of the principal points of the employee's response to the appraisal.) Need more assistance: 1. In developing Sales techniques 2. Upgrading knowledge of current products ll EMPLOYEE CAREER OBJECTIVES: (To be completed based on discussions with the employee in connection with the performance appraisal. These should reflect the employee's stated goals without any judgment by the manager as to the likelihood of their being achieved) Employee's Employee's Near Term Goals (1-2 years) Longer Term Goals (3-5 years) Increase Service units Best L.R. Area in State lll RECOMMENDED DEVELOPMENT STEPS: (These recommendations should be the manager's suggestions for specific steps the employee should take to acquire additional skills as the basis for possible advancement.) 1. Time management course. 2. Sales power negotiating. EMPLOYEE ACKNOWLEDGMENT: I have reviewed and had the opportunity to discuss the contents of this appraisal with my manager. My signature indicates that I have been advised of my performance status and does not signify my agreement of disagreement with the judgments made by my manager. Employee Signature Date It can be seen that in two areas, Planning and Controlling, an assessment was made that, it seems, Mr Logan's "skill" was marginal. His overall evaluation was satisfactory. It appears from the terms of a quality audit undertaken in 1992, and oral evidence of Mr Logan, that a quality audit was not undertaken in 1991. Mr Logan said in evidence he had a discussion with Mr Nott in August 1991 about him relocating "due to personal performance related issues". This accords with a file note made by Mr Nott about a meeting on 4 August 1991 at Orange with Mr Logan. There had been a phone conversation, about nine months earlier, initiated by Mr Logan, as to whether there were other jobs available similar to the job he then had. Mr Logan said he was then separated from his wife. Mr Nott had told him no jobs were available. Mr Logan was suprised when the issue was raised again in August 1991. He indicated he would not take up the offer of relocation because he was in the process of reconciliation with his family. Mr Logan accepted he received complaints by phone about his paperwork. While he did not accept there were complaints about certain specific classes of document he did accept there was a complaint that his time-sheets were late. The evidence points to these complaints being been made in 1990 and 1991. In October 1991 Mr Logan met with Mr Manion regarding his performance. Reference was made to events at the Anglo Australian Observatory ("AAO") at Coonabarabran, which I discuss shortly, and the possibility of Mr Logan working elsewhere for Otis. It was being suggested that he be transferred from Orange. Mr Logan restated his position that it was an inappropriate time for him to be considering relocating. He also said he had personal problems he was trying to sort out. The meeting was touched upon by Mr Logan in his oral evidence before the Judicial Registrar. More detailed evidence was given by Mr Manion in the proceedings before the Judicial Registrar. It was not challenged in the review and I accept it. Mr Manion said Mr Logan was constantly running late in submitting monthly expense reports. At best, they should have been submitted at the end of the month and they were expected within five working days from the end of the month. While it was not entirely clear, Mr Manion's evidence was also that invoices for goods or services obtained on Otis's behalf by a local representative had to be forwarded with the monthly expense report. These documents provided the basis for payment to suppliers and the reimbursement of the local representative of expenses incurred such as lunch with a client or prospective client or petrol. Mr Manion said the documentation was submitted late eighty percent of the time and up to eight weeks late. Mr Logan had a float of $700 to pay business related expenses. He would occasionally ring and request funds to reinstate or top up the float to $700 without having submitted the paperwork to enable that to be done. These matters were raised by Mr Manion in his meeting with Mr Logan. Mr Logan said he would try and be more timely with his paperwork and get things to Mr Manion on time. It appears he also said he was busy and he would get to it when he could. Mr Manion acknowledged that things did improve though he rather suggested that it was a temporary improvement and some problems persisted in relation to being provided in a timely way with invoices so as to be able to pay suppliers. Mr Manion also gave evidence that he discussed his performance more generally with Mr Logan. He raised with Mr Logan a call he had received from a disgruntled customer, Grace Bros. They discussed his family problems and Mr Logan agreed that he had been distracted through the earlier part of the year. Mr Logan indicated he was doing the best he felt he could in the circumstances. He agreed that he had been going through the motions through the earlier part of the year. Mr Logan agreed that he would make every effort to improve his performance. At that meeting Mr Logan raised the question of annual leave and that he was not able to go on annual leave when he wanted to and when he did he was always called up. Mr Manion said he attended to this problem when he returned to Sydney. A meeting was arranged in Sydney that Mr Logan would attend. It was a meeting to talk to the state manager, Mr Bayliss, and the service manager, Mr Nott, to discuss some of these issues, but more to look at the future and plan some objectives and some tasks for him to achieve. Such a meeting did take place on 21 or 25 October 1991. Mr Manion attended the meeting and recounted what had occured at the earlier meeting with Mr Logan at Orange. Mr Logan explained that he had been through some marital problems earlier that year and, as a result of the service manager and Mr Manion visiting him at Orange, he was aware of how seriousthey were about him improving his performance. The Grace Bros matter was again mentioned, the AAO was discussed and there were other discussions about other customers. Mr Manion gave evidence that Mr Logan said he was aware that he had "dropped the ball". It was put to Mr Manion in cross examination that Mr Logan never said he "dropped the ball" but this was not accepted by Mr Manion. During Mr Logan's cross examination before the Judicial Registrar, it was put to him that he said at the first meeting with Mr Manion that he said "I have dropped the ball" and he was "going through the motions". Mr Logan did not accept he said those words. It was not Mr Manion's evidence that he said both these things at the first meeting though, on one view, that is the import of the evidence. It is likely, however, that Mr Logan would have said such things in the circumstances. I accept Mr Manion's account of these meetings. Mr Logan remembered the meeting on 25 October 1991 with Messrs Nott, Manion and Bayliss. His recollection was the main topics of conversation were a customer report in relation to AAO and T sales and, in that context, his performance was discussed. He accepted there was some criticism of his administration of the Orange office but said it was not the major criticism. Mr Logan's duties under the agreement between Otis and AAO involved travelling to the observatory on a quarterly basis to inspect the two lifts at the observatory in conjunction with AAO's mechanic on site and to help him with any difficulties he was having with servicing them. Mr Logan said there was one unit that required more maintenance than the other units under his control. It increased the likelihood of a lift malfunctioning resulting in a breakdown visit. He said that on such visits he would not only repair the particular problem but would also rectify problems that the mechanic on site was having. He would do what he could of the routine service. Mr Logan said AAO's mechanic had primary responsibility for routine maintenance. Mr Logan said he had concerns about the level of maintenance by the site mechanic, a view he conveyed to his superiors at head office, in particular Mr Bob Nott, in an annual survey report. These matters arose in 1991. Mr Logan suggested to the mechanic on site that Otis could service the units on a monthly basis and assume more responsibility for the job. It appears Mr Logan told the mechanic that the reasons for making the suggestion was that the maintenance work was not being carried out to Otis's standards. When Mr Logan left Otis's employment in February 1995 the arrangements for servicing AAO's lifts were as they had been in September 1991. Documents were tendered concerning the problem with the lifts at AAO. The problems appear to have first been ventilated in a customer service survey dated 13 September 1991 completed by Mr Jonathan Pogson, the principal technical officer of AAO. It was received by Otis on 20 September 1991. Also sent was a letter of complaint dated 20 September 1991 from the executive officer of AAO, Mr Cunliffe. In so far as it might be thought to be critical of Mr Logan, it rates "responsiveness to (AAO's) needs" as "poor" and "prov(ision) (of) quality maintenance work" as "fair". The completed form notes that there were unscheduled repairs or breakdown call-backs and there is a comment "we can't even get him to do his scheduled visits!" The following appears in the comments section: "Our contract has 4 services per year, 1 per quarter. We seem to average 3 only per year. Some longstanding faults are never attended to, some repairs are requested before next service yet when the mechanic arrives he is unprepared and cannot make the repairs. We consider that we pay far too much for the service received. P.S. While our usual mechanic was on holidays (early 1991) another OTIS mechanic visited us - - - he was EXCELLENT in all respects!" By a letter dated 18 September 1991, Mr Pogson wrote directly to Mr Logan telling him that the critical survey had been sent and particularising some of the matters of complaint. By memo dated 2 October 1991 to Mr Bayliss, Mr Logan sought to answer the criticisms that had been made. As to the frequency of visits, Mr Logan said he had visited in late December 1989, early January 1990, mid May 1990, early June 1990, early December 1990, mid March 1991 and mid August 1991 and 27 September 1991. This, in my opinion, provides some support to the complaint made as to the frequency of Mr Logan's quarterly visits. In particular there was a period in the second half of 1990 when there was one visit when two might have been expected. Mr Logan, in his memorandum of 2 October 1991, took issue, it appears, with what was being said in relation to certain technical matters. On 5 November 1991, Mr Bayliss met with Mr Cunliffe where agreement was reached about a number of matters. One was that a new ten year contract would commence on 1 January 1992. On 11 February 1992, Mr Gardiner inspected the AAO site and wrote, on 20 March 1992, to AAO. He said, in part: "The condition of the elevators in far from satisfactory, however I feel this is due to lack of communication between both parties." He went on to explain why. It is difficult to assess whether the criticisms made by AAO had any substance in so far as they are intended to suggest Mr Logan was not performing his duties properly. As to the frequency of his visits, I have already indicated that, in my opinion, they do. As to the level of technical performance, it is to be remembered that at this time, as evident from the 1992 quality audit which I discuss shortly, Mr Logan's work performance had deteriorated in the period between March 1990 and August 1992. Even if it be accepted that it is probable that Mr Logan was not generally properly performing his duties to maintain units for which he was responsible, the significance of any such failure in 1990 and 1991 in relation to AAO should not be overstated. A survey completed on behalf of AAO in December 1992 is, on balance, a favourable one. In a note from Mr Gardiner to Mr Bayliss, dated 18 January 1993, enclosing the survey, Mr Gardiner said: "we now have a much better working relationship with this client". Mr Gardiner's evidence was to the effect that, since the events of late 1991 and early 1992, there had been no further complaints from AAO. f. Evidence about work performance - 1992 In 1992 there was both a quality audit and an annual performance appraisal of the work of Mr Logan. The quality audit, undertaken by the person who undertook the 1990 audit, was critical of Mr Logan's performance. It was undertaken on 5 August 1992. The following appeared in the report, though I have omitted some of the more detailed technical commentary: "In total, 5 Service Quality Audits were carried out covering 5 units; 2 units or 40% rated below 75%. The results are: Routines Adjustments 72.6 78.9 Average 75.8 Also, 1 Construction Quality Audit was carried out on 2 Concepts at the Department of Agriculture, Orange. The results are; Adjustments Installation 78.4 96.5 Average 87.5 OBSERVATIONS The rating of 75.8 is extremely disappointing when compared with the previous audit rating of 86.4 in March, 1990. Basic routine maintenance procedures were lacking on most sites; several did not display a maintenance check list. Controllers require attention (see defects graph), with some penalised for not testing and date tagging N301 type overloads; refer to correspondence FOD:ASD:357 dated 5/7/97. Well work is required on all units inspected, both in routines and adjustments. The generator commutator at Caves House is extensively scarred and needs attention. The governor at Bathurst Hospital continues to emit noise which can be heard in the hotel. Customer comments were generally positive with no major complaints. The major areas where improvement may be obtained are listed below: There then appears a list of tasks that the auditor indicates, expressly or impliedly, should be undertaken. The report continued: "The Construction result was very disappointing. Although the NIS period has almost expired, in my opinion many items reflect on the original installations and adjustment procedures. Most noticeable was the rough deceleration and general ride quality on both lifts but especially No.2. Ross Gardiner stated that with the replacement of the rifled sheave on No.2, both lifts would be readjusted. CONCLUSION With the obvious problem being routine maintenance, the CRM System or equivalent must be implemented to improve this area of service. Although the call-back MATs at this time are satisfactory, it must be emphasised that without the application of good housekeeping procedures, call-backs will increase. On completion of the items listed, or within 3 months, would you please ensure copies of the completed report, or a plan of action, is returned to the writer. Finally, may I express my appreciation to Peter for the assistance received during this visit." This report constitutes an evaluation of the work of Mr Logan disclosing that there had been a fall in the quality of the work he was doing. Indeed, that was the view of his immediate superior who, on 28 August 1882, sent him a facsimile letter in the following terms: "Further to our meeting on 13th August, during my visit to Orange, and our subsequent telephone conversation today, this letter serves to confirm the requirements that will be expected from you in the next month. I regret not been able to meet you in person over these issues but the urgency of the situation required urgent action. As was explained your maintenance routines are not up to the required Otis standard. It is expected that Local Representatives will meet the following standards 1. No Quality Audit scores below 80. 2. All technical Article Must Changes are to be completed as issued. 3. Routines should never score below the level of adjustments, in particular, motor room and shaft housekeeping, ie. the equipment adjustments need to be in keeping with the age of the machinery. 4. Controlled routine maintenance cards should be placed in every motor room and completed during every visit. 5. All weekly reports need to be received by the Branch office as per the issued schedule, ie. timesheets to be received by each Tuesday. I acknowledge that prior to my taking over the management of the area you felt that you were not receiving the necessary support. However, you agree, that has not been the case this year and your performance has not improved over the last nine months, despite your discussions with Bob Nott (then NSW Service Manager), Rod Bayliss (State Manager) and Chris Manion (Personnel Manager), and the subsequent Appraisal which clearly outline outstanding issues that needed to be resolved. The recent Audit scores have been very poor and have evidenced lack of improvement and have left me with no alternative but to issue you a final warning. I urge you to contact me if you require assistance, or wish to discuss any of these issues further. Please remember that unless your urgent attention is directed to these issues, I may be left with n option but to terminate your employment with the company. I will review your area again on 23 September and expect that these requirements will have been met." (emphasis added) I will refer shortly to specific events earlier that year that are likely to have contributed to the writing of this letter. Of some significance, in my opinion, is that Mr Logan did not respond to this letter putting in issue what was asserted about his poor performance. A month or so later, on 23 September 1992, an annual performance appraisal was undertaken by Mr Gardiner. It was completed on the standard form used for the 1991 performance appraisal set out earlier in this judgment. It is unnecessary to repeat the contents of the standard form. The comments by Mr Gardiner were as follows: "PLANNING (Satisfactory) Peter has to further improve his planning procedures, to a level required of a Local Rep. Firm instructions have been laid down on what is required for 1993. DECISION MAKING (Good) His knowledge and experience assists in this field. Peter has been encouraged to utilise the Branches resources to allow even greater achievements. CONTROLLING (Satisfactory) Increased efforts are required to ensure planned performance standards are met. COMMUNICATING (Good-Satisfactory) Has good rapport with majority of external clients. Further concentrated efforts towards select clients would improve his alround ability. Internal reporting has improved. WORK COMMITMENT (Good) With a little more time spent on house-keeping, Peter's overall performance would improve sharply. Time Management still requires addressing. WORKING WITH OTHERS (Good) Peter is well respected by his peers. His isolation doesn't allow for a great deal of communication with others. Summary Appraisal: (Good - Satisfactory) Comments: Peter needs to continue his progress in planning and controlling his areas requirements. By utilising Company standard procedures together with his knowledge and experience 1993 should show further improvements. EMPLOYEE RESPONSE: With support from Branch Office, more time can be spent on service routines, customer sales enquiries and increasing the number of service unit contracts. EMPLOYEE CAREER OBJECTIVES: Near Term Goals: Continue to make use of in-house training facilities Longer Term Goals: Local Manager in a large area on or/off shore. RECOMMENDED DEVELOPMENT STEPS: 1. Time Management Skills 2. Sales Negotiating Techniques" In some senses it is difficult to reconcile Mr Gardiner's letter of 28 August 1992 threatening termination and the evaluation made in late September 1992 that, in summary, his performance was assessed as between good and satisfactory. The answer may well lie in a meeting held in September 1992 in Orange. In attendance were Mr Logan, Mr Gardiner and Ms Patricia Pithers who was the NSW human resources manager. Mr Gardiner said that it was a meeting following up the letter and intended to press upon Mr Logan that his performance was not viewed as up to standard. Asked about Mr Logan's response, Mr Gardiner said: "Peter is a very friendly, easy-going sort of person and I think during my time as manager with Peter that we had a good relationship and we could talk openly to each other. Peter accepted in his manner that, yes, the audit scores were not up to standard and, yes, he would give me the obligation/undertaking that he would set out to improve that." Mr Logan's continuing personal family problems were discussed in the context of his performance. Mr Logan said, and I accept, that he indicated his position was a lot clearer and things were improving. Mr Logan did not recall a customer complaint about failure to keep customer appointments being raised. Mr Logan accepted in evidence that Mr Gardiner may have said he was the last local representative to submit timesheets and the last to submit reports. There was also a complaint made to Mr Logan that he failed to meet his T sales. It is probable that the stern terms of the letter of 28 August 1992 were to prompt Mr Logan to improve. It is also probable that the annual appraisal was in the terms it was because, in part, of the good personal relationship Mr Gardiner perceived he had with Mr Logan, and the latter's undertaking to improve. Mr Gardiner wanted to be as positive as he could be in the circumstances. That this was Mr Gardiner's approach at the time was evident in a note he wrote to Mr Bayliss dated 17 August 1992. It was written after Mr Gardiner had visited several sites serviced by Otis in the Orange area. He had concluded that several sites disclosed deficiencies in the servicing. Mr Gardiner summarised his impressions in the following terms: "Peter has a great deal of experience and a lot to offer Otis. His audit scores are still showing the effects of his previous 12 mths traumas. His audit level in 1990 was 86.4 which shows that his previous 5 years work must have been of an acceptable standard. I personally have enough reason to believe that the previous support and follow-up to the Orange Local rep was not that of an acceptable level. I also spoke to nine clients and customer contacts during my two days in Orange/Dubbo who appear to have no adverse feelings towards either Peter or Otis." Mr Gardiner then recommended several courses Otis might take including the termination of Mr Logan's employment. The letter of 28 August 1992 appears to have been a compromise of sorts. However it is plain that Mr Logan's performance was viewed in late 1992 as falling short of what was expected of him and the objective evidence points to that being so. Mr Logan agreed that in February 1992 he met with Mr Gardiner at AAO to deal with the complaint from them though I discussed earlier the nature of the complaints that had been made in late 1991. In February 1992 a complaint was made by the Australian Workers Union ("AWU") concerning the maintenance of a lift in a building in Dubbo. On 18 February 1992, the Senior Vice President of the AWU had written to the "Service manager" of Otis at an address in Sydney. It contained a complaint in the following terms: "I must say we are totally dissatisfied with the attendance of your maintenance personal (sic). Over the last two years visits have fell (sic) to an unacceptable level. Last year we had several visits from a relieving persons (sic) who we believe was based in Canberra, his visits for the short period were most regular. Apart from this period we saw your district maintenance employee one." In evidence Mr Logan, after proffering an explanation based on the main office being unattended and there being no one there to receive or sign his paper work, did admit to missing some maintenance visits. Mr Gardiner said, and I accept, that Mr Logan had said, when this complaint and the complaint concerning the AAO was raised, that he had a high workload in the area and it may be, from time to time, that he would miss certain visits. In these proceedings, counsel for Mr Logan points to the concession by Mr Gardiner that after he spoke to Mr Logan he had no further complaints in relation to the maintenance of the lift at the AWU's building. Mr Logan gave evidence that at some point prior to August 1992, he had raised with Mr Gardiner that he felt he was not getting enough support. This is consistent with observations made by Mr Gardiner in his letter of 28 August 1992. Mr Logan said he had to fight with head office to get someone to do repair work in his area. He was also not getting enough support at a personal level with communication being limited and, when it occurred, often critical of the work he was doing. I generally accept the evidence of Mr Logan on this issue. (g) Evidence about work performance - 1993 In 1993, Mr Logan's performance was again the subject of a quality audit and an annual performance appraisal. The audit was conducted in early July 1993 by the auditor who had conducted the 1991 and 1992 audits. The report was a combined report concerning the Canberra and Orange areas. In relation to Orange it contained the following: "Orange 6 Audits covering 6 units with zero rated below 75%. Routines Adjustment/Repairs 81.5 82.9 Average 82.2 Observations Orange The result of 82.2 is an increase of 6.4 on the 1992 audit of the area. Routine maintenance was almost 9% improved from last year with all units inspected rating well. It is obvious the area has received good support from Newcastle as many outstanding repairs have been completed. Other area where further improvement may be obtained in both areas area listed below:..." There are then listed some specific technical matters that need not be reproduced. The report went on: "CONCLUSION In contrast (to Canberra), the result in Orange is outstanding with the area 'back on track' with maintenance quality. I'm sure the area will continue to rate well in future audits. On completion of the items listed, or within 3 months, would you please ensure copies of the completed reports, or a plan of action, is returned to the writer." This report was dated 15th July 1993 though the primary documents that it was based on were prepared at the time the audit was undertaken. Seemingly by reference to those primary documents, Mr Gardiner sent Mr Logan a memorandum dated 13 July 1993 in the following terms: "Congratulations on your scores just completed. The level of scores reflects your improved effort and commitment throughout the past twelve months. Keep up the good work." Mr Gardiner had also sent the primary documents to Mr Logan with a "with compliments" slip saying: "Note the comments of Glenn Beddall. He is very impressed. Well Done." Mr Beddall had written on them comments like "Excellent" and "well done". A month or so before Mr Beddall had written to Mr Logan congratulating him as a result of an extremely favourable report received from one client, being Peppers, Jenolan Caves. The annual performance appraisal was conducted much later in the year. Again it took the standard form, dated 22 December 1993, with the following comments made by Mr Gardiner. "PLANNING (Satisfactory) Further emphasis is required in this area, specifically in the area of setting and achieving objectives. ORGANISING/STAFFING DEVELOPING (Good) This skill is not practised greatly in the Local representative areas. Assistance during Construction activity in area is well organised. DIRECTING (Good) Again, this area is not called upon during everyday activities of the Local representative. CONTROLLING (Satisfactory) Greater effort is required in achieving planned objectives. Increased liaison with Branch Office would improve performance. COMMUNICATING (Good) Continued improvement has been noted in this area during the last 12 months. This skill will continue to meet expectations. WORK COMMITMENT (Good) A continuation of positive customer reports emphasises Peter's ability in this area. WORKING WITH OTHERS (Good) Limited opportunities are available in this field. Customers respect is signified by favourable reports. DECISION MAKING(Satisfactory) Further improvement can be obtained with greater commitment. This will continue to develop as Peter reinforces recent achievements. Summary Appraisal: Good Comments: Peter's achievements over the past 12 months reflect the improved stability in his all round performance. Further emphasis is required in the understanding and achieving of set objectives. EMPLOYEE RESPONSE: Peter feels that this appraisal is fair and accurate in relation to this years performance. EMPLOYEE CAREER OBJECTIVES Near Terms Goals To maintain positive growth To obtain set goals in relations to Business Plan Longer Term Goals To obtain further experience in other areas of company business RECOMMENDED DEVELOPMENT STEPS: Attend recommended NTC courses eg. Negotiating Skills Customer Service Skills Small Business Management Course" A letter dated 7 January 1994 was sent on behalf of Mr Gardiner informing Mr Logan of a salary increase arising from an annual salary review. Mr Gardiner said "This increase reflects a good performance during 1993 ..." Mr Gardiner sought to diminish the effect of these remarks by saying in evidence that Mr Logan's salary increases in 1993 and 1994 were 1 per cent and 1.8 per cent respectively while other local representatives received increases of 4 per cent or 5 per cent. However that fact does not, in my opinion, detract from the clear intimation that Mr Logan's performance in 1993 was generally assessed as good. Evidence was led about three matters that might be thought to qualify the positive assessments made in 1993 in the audit and review. The first matter concerned the client, Grace Bros. Mr Gardiner said there was a gradual deterioration of Mr Logan's work during the middle of 1993. He made this comment by reference to "a couple of occasions" at Grace Bros in Orange when there had been no payment by the client because no one had attended to maintain the unit that month. Mr Gardiner described the responsible employee of Grace Bros as "a very demanding manager who used to keep a very good account of his maintenance visits and maintenance records." The evidence in relation to this matter is not entirely clear. Mr Gardiner gave evidence about a discussion he had with Mr Bentik, from Grace Bros, in which Mr Bentik complained about Mr Logan's irregular visits. However this conversation would have been in late 1991 or early 1992. There was evidence from Mr Gardiner that there were two or three occasions when credit notes had to issue because of Mr Logan's failure to attend the premises. One would have thought that Otis would have records of each instance. The only documents in evidence, both documents created by Mr Gardiner, show that a visit was missed in June 1993 for which a credit note issued. Mr Gardiner noted in a memorandum of 10 September 1993 that there were two service visits the next month. Somewhat curiously, a summary of visits in a memorandum of Mr Gardiner dated 20 December 1993 records a visit having occurred on 9 July 1993 and the next on 20 August 1993. It is improbable that there was a visit between 30 June 1993 and 9 July 1993. At best those documents establish that the June 1993 visit was missed. Mr Logan said he had no knowledge of a suggestion that during 1993 he had on three or four occasions missed carrying out his scheduled maintenance at Grace Bros Dubbo, or of Grace Bros refused to make payments because of lack of maintenance. The second matter concerned the client, Australian Defence Industries "(ADI)". Otis had a contract which required the monthly servicing of lifts at premises in Lithgow. A review of the maintenance of those lifts was undertaken by Australian Construction Services ("ACS") on 17 March 1993. In a report dated 30 March 1993, ACS was critical both of the standard of maintenance and the frequency and duration of the maintenance visits. The latter was by reference to visits during the period December 1992 to February 1993. It appears a copy of the report was first forwarded to Mr Gardiner by ADI several months later, by letter dated 3 August 1993. In that letter ADI sought to alter the level of maintenance so that only three of the nine lifts would be maintained as fully operating lifts. ADI sought a revised contract price. Mr Gardiner's oral evidence was that Otis entered a contract to that effect but that the contract was cancelled because, it appears Mr Gardiner contended, a monthly visit was missed. Later he suggested it was cancelled in September 1993 because Mr Logan failed to attend fortnightly as he and Mr Gardiner had agreed he should. That such an arrangement had been agreed between Mr Gardiner and Mr Logan is consistent with a facsimile from the former to the latter, dated 13 August 1993, proposing such an arrangement. However, Mr Gardiner's oral evidence is at odds with a memorandum from Mr Gardiner dated 5 September 1994 to the Support Operations, Administration Department of Otis. It took the form of a completed form entitled "Notification of Service / Maintenance Change". In it Mr Gardiner records that the ADI contract was being cancelled, effective 30 September 1994. The reason Mr Gardiner records was: "Factory down sizing, use of lifts now minimal. They are trying to reduce costs at all times. Boral have accepted to maintain units month to month at a lesser cost." Mr Gardiner said that credit notes issued in 1993 in relation to, inter alia, ADI arising from "non-attendance of programmed maintenance visits". However no documents were tendered on this matter and given the vagueness of Mr Gardiner's oral evidence, I place little weight on it. This material does not demonstrate an ongoing problem during 1993 with the performance by Mr Logan of his work and, at best, demonstrates a failure, in late 1992 and very early 1993, of Mr Logan to attend as regularly or for as long as the ADI might have expected and a failure, prior to March 1993, to maintain the lifts to an optimum level The last matter concerns T sales and a meeting in, according to Mr Gardiner, June 1993. The meeting was a general meeting of local representatives in Newcastle. When giving a presentation about his sales as against plan, Mr Logan had been a bit vague. Otis operates on a business year commencing on 1 December and concluding on 30 November. The June meeting was viewed by Mr Gardiner as a mid-year meeting. At that point Mr Logan had made no monthly submission for that year proposing T sales for which quotations could have been provided. Mr Logan accepted that in 1993 he was way under budget in the T sales he effected and he met probably approximately 20% of the budget amount. In March 1993 Mr Logan underwent training which he later used in trying to effect T sales. It appears that the late submission of timesheets was a matter of concern of Mr Gardiner. In July 1993 he sent a memorandum to, amongst others, all local representatives asking that they send in timesheets promptly. Mr Gardiner said, and I accept, that of the local representatives, Mr Logan was the only one who did not submit his timesheets on time. (h) Evidence about work performance - 1994 and 1995 Mr Logan was given his 1994 performance appraisal, dated 17 November 1994, by Mr Gardiner. It was in the same form as earlier reports and relevantly provided: "PLANNING (Marginal) Peter's efforts in achieving set goals in this area have been disappointing. DECISION MAKING (Satisfactory) Although Peter uses his Branches support, more effort could be made to utilise alternate solutions. CONTROLLING (Marginal) Further work is required in this skill, events don't always coincide with plans. COMMUNICATING (Satisfactory) Peter requires additional training in this field written communication and presentations are not always up to standard. WORK COMMITMENT (Satisfactory) Peter is prepared to work the hours to achieve results, however better time management would assist greatly. WORKING WITH OTHERS (Satisfactory) Further training is required in this field, to develop an ongoing rapport with others. QUALITY (Satisfactory) Peter is aware of company systems and maintains quality standards as required. ENVIRONMENTAL HEALTH & SAFETY (Satisfactory) Although Peter works safely more effort is required to demonstrate further awareness and commitment to E.H.& S. EMPLOYEE RESPONSE: Peter advises that since there has never been any written or formal instructions on what he should be doing, all the comments are too general. There has been no mention of specific incidents or ideas of expected improvement. EMPLOYEE CAREER OBJECTIVES: Near Term Goals To be able to get on with job. Secure contracts out of tenure and expand Otis's role in the area as the leader in lift and escalator manufacture & service Longer Term Goals Keep an open mind about advancement opportunities in the future with Otis. RECOMMENDED DEVELOPMENT STEPS Customer Service Training Time Management Course SUMMARY APPRAISALMarginal Comments: Generally Peter's performance this year has been not up to standard. 'T' Sales were non existent, with little work done on securing out of tenure contracts. Although Peter occasionally worked long hours on certain projects other more important issues were neglected. I believe a technical position within the company would be better suited to Peter than his current role." Prior to that date he had been given a partly completed performance appraisal by Mr Gardiner at a special meeting in Lithgow. The final document contained a section "employee response" which had been completed by Mr Gardiner on Mr Logan's instructions which were given approximately a week after the meeting in Lithgow. The "comments" include the suggestion that Mr Logan would be better suited to a technical position rather than his position as local representative in Orange. The question of Mr Logan transferring from the Orange area was first raised with him in a phone conversation in May 1994 with Mr Gardiner. Mr Gardiner asked him to test the water by discussing it with his family. There was, at that stage, no indication the sort of job he would move to or where. He later responded to Mr Gardener by telling him his family was not happy about it. The subject arose again in a conversation with Mr Gardiner at a conference, at Bowral in June 1994, of local representatives from throughout Australia. No specific job was mentioned but a suggestion was made that Mr Logan might take up a supervisory position which he understood would be in a major urban area such as Sydney, Newcastle or Canberra or in another state. Mr Logan indicated his family was then settled and he did not wish to upset the education of his children who were then probably 15, 12, and 7 years old. Mr Logan accepted that when he was asked to transfer from Orange he was offered employment in Sydney, Gosford or Canberra and that Otis offered to pay the reasonable costs of relocation. It also offered not to move him until it was a suitable time for his children's schooling. There was an issue as to whether, at the Bowral meeting, Mr Gardiner said to him "Orange is no longer an option". That is, whether it was then made plain that he had to move. Whether it was or not does not appear to me to be material. On 11 September 1994, Mr Logan had met in Newcastle with Mr Gardiner and Mr Glen Beddall, state manager NSW and ACT. The meeting occurred after a quarterly review or meeting of local representatives supervised from the Newcastle office of Otis. It was Mr Beddall's assessment that Mr Logan's presentation, at the local representatives meeting, of his business plan, including means of achieving T sales, was quite inadequate. It did not appear that Mr Logan took issue with this assessment. He explained in evidence that he had not had the time he needed because he had been working on submissions for 3 units at the Mt Piper Power Station. At the meeting with Mr Gardiner and Mr Beddall, Mr Logan was told his performance was not up to standard and his future employment with Otis was discussed. He was told his chances of being accepted into a management type job were minimal because of his age. Mr Logan was offered a job as a service adjuster in Sydney. Mr Logan was told they had decided to move him out of the Orange area and he would have some time to talk it over with his family and make arrangements. He gained the impression that if he did not relocate he would be "out the door". He was informed they would advertise for his position in Orange and he would stay there as long as was necessary to train a replacement. A service adjuster is a person who works on existing lift installations, particularly problem lifts, that need major readjustments. Mr Logan understood the local representative position to be a staff position and that a service adjuster was a wages employee. That is, he would be required to clock on and off and would be covered by an award. Mr Logan said that it was a devastating to be told that, having persevered with him in the hope that he would improve, Otis had formed the view that he could not continue to represent the company in Orange but that they would be prepared to transfer him. When the question of transfer was raised in September 1994 it was not a total suprise but he had been suprised about points raised about his capacity. At the time of his termination, Mr Logan's gross salary was approximately $41,000 per annum. The offer of other employment would have resulted in an income of $32,000 per annum. After the meeting with Messrs Gardiner and Beddall, Mr Logan wrote to Mr Beddall on 11 September 1994 providing him with a report concerning his performance. It referred to the successful negotiation of two service contracts and the recapture of business concerning a unit installed at Grace Bros, Dubbo. However the recapture was the result of an agreement applying throughout NSW, regulated by head office. In the report he also dealt with his T sales performance. Mr Logan accepted that he continued to have problems submitting timesheets for work done. Mr Logan said the reason why he had had difficulties with timesheets in late 1994 was partly because of the stress he was under to relocate and partly because of two jobs he had involving construction work. He became involved in testing and inspection which consumed a lot of his time. He was not aware of complaints by suppliers and subcontractors towards the end of 1994 threatening Otis with legal action for failing to pay accounts. Nor was he aware of Ms Nancy Carr, supervisor of the government offices in Orange, complaining in October 1994 that they were not receiving maintenance services. He did, in evidence, acknowledge that there was mention in a phone call that she had not seen him last week or month. Who the phone call was with, however, was not clear. The evidence on this issue of the servicing of two government offices in Orange is somewhat obscure. In a service report completed by Ms Carr in September 1994, she indicates a generally high level of service from the Otis service mechanic who provided regular maintenance service but a generally poor level of service on the part of the "Otis Local Manager/Local Representative". Mr Tull, who had succeeded Mr Gardiner as the manager, Newcastle and Northern NSW, in October 1994, spoke to Ms Carr in late January 1995. She said to him she was constantly having to ring up Mr Logan to get service done. Mr Tull's evidence was that he did not speak to Mr Logan about it. It is likely, therefore that the phone conversation Mr Logan gave evidence about was with Ms Carr. However this evidence falls short of establishing that in mid to late 1994 there was a systematic failure on Mr Logan's part to perform routine and regularmaintenance as required to meet Otis's contractual problems obligations. On or about 22 November 1994, Mr Beddall wrote to Mr Logan. The memorandum contained a review of the perceived deficiencies in Mr Logan's performance in the preceding three years. It was, in essence, a direction that Mr Logan take up employment elsewhere with Otis and relinquish the position of local representative at Orange. On 20 January 1995 there was a meeting between Mr Bull, Mr Logan and Mr Etherington, a human resources manager. Mr Logan was told he was not able to stay in Orange, he would be replaced, and he was offered a job in Sydney or Gosford or Canberra. He was told Otis would meet the reasonable costs of relocating. He was also told that he would not be required to move until it was suitable for his children's schooling, though what this meant was never explored fully. In the letter of 22 November 1994 from Mr Beddall, it had then been indicated he had to leave Orange by the end of January 1995. Mr Logan had already sought legal advice and said at the meeting he would be seeking legal advice at the meeting. Thereafter his solicitors wrote indicating that Mr Logan refused to leave. On 6 February 1995 Mr Tull visited Orange and arranged for Mr Logan to hand over to his replacement. He was asked to gather together the company records he had. Mr Logan met with Mr Tull and Mr Etherington at Parramatta on 8 February when he was paid out. He was given a company car to use for a further four weeks. In 1994 Mr Logan's T sale budget was in vicinity of $31,000 but the final T sales figures achieved by Mr Logan was only about $4,000 or $5,000. That is a reference to sales secured as a result of submissions made by Mr Logan. There is evidence to suggest that in 1994 Mr Logan submitted proposals to pursue T sales totalling $134,000 and, according to Mr Tull, he made submission totalling $54,000 between September 1994 and January 1995. Mr Logan gave evidence, that he submitted T sales orders of about $8,000 in January 1995. Mr Tull said the amount was $5,088 and both orders were placed directly by the clients. A lot of detailed evidence was given about the process of submitting T sales and the setting of the sales budgets, particularly after Mr Gardiner came to supervise Mr Logan in late 1991, as well as changes in reporting proceedings made in 1994. For reasons which become apparent shortly, they are not matters I need address in detail. (i) Hours Worked and Callouts Mr Logan's evidence was that between July 1985 and February 1995 he worked between 32 and 40 hours a week maintaining, servicing installing and/or assembling lifts and escalators. He said he spent between 15 and 25 hours per week travelling. On this evidence, the range of hours he worked on these tasks was 47 to 55 hours per week. He said that between July 1985 and late 1991 he spent a further three hours weekly on administration which increased to 10 hours per week from January 1992. Thus, on his evidence, the range of hours worked, before January 1992 were 50 to 58 hours per week and, after that, 57 to 65 hours per week. This evidence was not, however, free from ambiguity though its general tenor was clear. Otis responded to this evidence, in particular, by calling Mr Leonard Algie, who was the field operations manager of Otis. He undertook an analysis of records kept by Otis. Having regard to the way the data in the records was compiled, it was possible to make the analysis only for the year ending in November in 1986 to 1992 inclusive. There was no real issue that for purposes internal to Otis, an expression "productive time" was used to describe time in which an employee was engaged, for example, in repairing and maintaining lifts and travelling for that purpose. Nor was there an issue that an expression "non-productive time" was used to describe time spent on administration tasks. The analysis reveals that the average weekly hours of Mr Logan for productive time, for which 32 hours is notionally allocated, was: "1986 28.9 1987 28.08 1988 57.15 1989 24.25 1990 24.67 1991 28.19 1992 24.46" The relevant source documents, in relation to Mr Logan, were field activity reports submitted by him to the regional office, which I take to be the NSW office initially and later the Newcastle office. Mr Algie accepted that if the field activity reports were not accurate, then the figures I have just set out would not be accurate. Mr Logan gave evidence, that was not effectively challenged in cross-examination, that the field activity reports were completed on the same basis as his timesheets, which is a matter I discuss in more detail shortly. He also said that he did not include in the field activity reports, on which he recorded his hours of work, the time he spent in travelling to sites whether for maintenance, call-back or other visits. Considerable detailed evidence was given by Mr Logan and Mr Gardiner, in particular, concerning the manner in which Mr Logan and other local representatives completed or should have completed their timesheets. The import of Mr Logan's evidence was that irrespective of the number of hours he actually worked, he recorded on his timesheet 32 hours of productive time and eight hours non productive time. What clearly emerges, in my view, from the evidence is that Mr Logan recorded on his timesheet nominal hours worked and not actual hours worked. It is to be recalled that, when he was first appointed, Mr Logan was shown a document by Mr Bull which I set out earlier in this judgment. A similar form was annexed to a document that Mr Logan had in his possession, dated May 1964, instructing local representatives on how to fill out their weekly timesheets. Mr Logan said, and I accept, that he would have got this as part of the papers handed to him by Mr Sarchfield, his predecessor. Mr Bull's evidence was to the effect that he explained to Mr Logan that the document was used to record actual hours worked. So much is apparent from terms of the document itself. Mr Bull agreed with a proposition put to him by counsel for Mr Logan that if an employee worked 10 hours on a site he would record 8 hours in the first line as regular productive time and 2 hours on the sixth line as productive overtime. This is illustrated in the entry for Tuesday filled in by Mr Bull in the column for Tuesday. It is also apparent from the notation made by Mr Bull in line four, "travelling outside normal working hours", that the form was to be completed so as to record any travelling outside the eight hours that the employee would be expected to work. However the working day and the working week of the local representative, in terms of productive time, was not as symmetrical and ordered as the completed form used as a sample by Mr Bull would suggest. In evidence were three documents described as route schedules. They constitute a list of units that must be attended to and identify the day of the work they will be visited. Each document covers a work cycle of four weeks. One of the route schedules had been used in the Orange area before Mr Logan commenced as local representative and was inherited by him. Another he created after he arrived, and another he created in December 1991. They disclose a working pattern where productive time is spread over five days with a differing number of hours being worked on the days identified in a four week cycle. The route schedule Mr Logan inherited is broken down so as to identify travelling time and working time, both elements of productive time. The route schedule created by Mr Logan did not. Mr Logan said that while the form was explained by Mr Bull in the way just described, he was told at the conference of local representatives in November that year to simply fill out 80 per cent productive and 20 per cent non productive. I accept this evidence. It is consistent with a practice in place several years later when Mr Gardiner assumed the supervisory position at Newcastle. Mr Gardiner acknowledged in evidence that between the time he started in December 1991 and September 1993 when he wrote a memorandum I refer to shortly, he was informed by some local representatives that because they were on annual salaries they simply recorded 32 productive hours and eight hours non-productive time. The September 1993 memorandum was a direction to local representatives to record on a timesheet, which it appears was not the weekly timesheet, on-site call-back time. It also contained the direction "continue to book 32 hours productive and 8 hours office routine as before." An earlier memorandum from Mr Gardiner to local representatives dated 9 December 1992 said, in relation to Orange, "Remember when doing your weekly timesheets the break up is as follows: ... PRODUCTIVE ... 80% ... OFFICE ... 20%." I am satisfied that the hours recorded by Mr Logan do not establish the hours he worked. I accept his evidence that he simply filled in 32 hours productive and eight hours non productive because he believed that is what he was required to do and not because it reflected hours he actually worked. I am also satisfied that because the records upon which Mr Algie based his analysis were filled in so as to record notional hours and did not include travelling time, that analysis does not establish that Mr Logan's evidence about the hours he worked is wrong. Mr Algie also gave evidence of time he spent in the Orange area with the local representative who replaced Mr Logan and expressed a view about the correctness of certain assumptions concerning travelling time in Mr Logan's route schedule and the time the work required of the local representative might reasonably be expected to take. However this evidence is, in my opinion, to be given limited weight in view of the failure of Otis to call the existing local representative to give evidence. That matter I discuss in more detail shortly. There was an issue as to whether Mr Logan's administrative duties increased when Mr Gardiner assumed the role of his managerial supervisor. I am inclined to accept Mr Logan's evidence that there was an increase in the time it took him to do administrative work but the extent of the increase was probably exaggerated at least for the years 1991 and 1992. Part of this period of ten hours administrative work involved reading and related clerical work which was necessary to effect T sales, and it was Mr Logan's evidence that these administrative tasks "happened a lot" in the last 12 months, viz. in 1994. The clear implication was that it had not been a feature, or as significant a feature, of the administrative work he undertook in the early years of Mr Gardiner's supervision. A factor in accepting the general thrust of Mr Logan's evidence, though I do not wish to overstate its importance, was my impression of Mr Gardiner as a thorough and probably punctilious man. I could well imagine that his management style involved, and I do not say this critically of him, extensive communication and comprehensive reporting. That view is consistent with the commitment he gave Mr Logan to provide greater support, which was a matter Mr Logan had complained to Mr Gardiner about in relation to Mr Logan's previous management supervisors. It is also consistent with a quality accreditation system introduced by Mr Gardiner when Newcastle manager. Up until February 1993, Mr Logan took, it appears, 12 rostered days off during the year though that month he was told by Mr Gardiner to stop that practice. It was common ground that local representatives had to be available for callouts to deal with emergencies. It also appeared to be common ground that Mr Logan had to be contactable so as to attend to such callouts or, if absent from the area, notify the Newcastle office and arrange for an electrical contractor to be available to cover callouts. The system of notifying Mr Logan of an emergency that might require him to attend urgently involved, before February 1992, Mr Logan using the services of local security companies to accept calls diverted from his home if he was out. From February 1992 most calls relating to emergencies were made to a centralised answering facility called Otisline which first began operating in that month. With limited exceptions, any callout Mr Logan was required to make after February 1992 would have been through Otisline and, ordinarily, apparent from computerised records relating to its operation. However Mr Logan said, and I accept, that there were at least two instances of sites to which he was called out which were not the result of calls to Otisline. One was the Friskies Pet Food site at Blaney and the other the Mt Piper Power Station. During the proceedings it became clear that the Otisline computer records were not themselves a comprehensive record of callouts arising from contact with Otisline. A critical issue is whether the contention of Mr Logan that the hours he spent on productive time, including travelling, were considerable or whether, as contended by Otis, his energies and time were being spent disproportionally on running his farm and doing other work as an electrical contractor, and that he was exaggerating his productive time engaged on work for Otis. From Mr Logan's tax returns the following emerged. The income he derived from the farm for the year ending 30 June 1995 was $10,875 and 30 June was $8,830. Over the financial year 1994/5 there had been 334 sheep and 18 cows on the property and the financial year before that 316 sheep and 41 cows. I should add that counsel for Otis sought to use these figures to discredit evidence given by Mr Logan that in February 1995 he had 130 sheep and 10 or 12 cattle. However the tax returns also contained a figure for stock at hand at the end of the financial year. For 30 June 1995 it was 122 sheep which is entirely consistent with the evidence of Mr Logan gave about stock levels in February 1995. It may be accepted that a farm carrying stock at these levels would require some work. Mr Logan said, and I accept, his wife was actively involved, with him, in running the farm. I also accept that his level of earnings doing electrical contracting work, $950 and $745 in 1993/94 and 1992/93 respectively (the income of $2,115 for 1994/95 included the period after his employment with Otis concluded), was likely to have been for more than what Mr Logan described as "love job[s]" where what he charged was substantially to cover the costs of materials. There were no deductions of a corresponding magnitude for expenses referable to materials. The running of the farm and electrical work may well have accounted for time that Mr Logan now says he spent on work as the local representative of Otis in the Orange area. However Otis could have demonstrated the time it would take to do the work as a local representative in the Orange area comparatively simply by calling the local representative who took over from Mr Logan. There was evidence from Mr Algie that the workload did not change substantially at least until early 1996 when Otis acquired another elevator/lift business. Mr Algie gave evidence that he reached this conclusion after an examination of the present representative's workload and discussing it with that local representative. He sought to give evidence about the time the work would take but the admission of that evidence was successfully objected to by counsel for Mr Logan. The objection was ruled on on the first day of the hearing of the review on 14 October 1996 and had been foreshadowed in a list of objections filed on 8 October 1996. Notwithstanding this, the present local representative was not called, nor any explanation given as to why he was not called. In my opinion, the failure of Otis to call the local representative who took over from Mr Logan plainly brings into play the principles in Jones v Dunkel (1959) 101 CLR 298. A comparatively recent discussion of them is found in the judgment of Wilcox J in Lek v Minister for Immigration (1993) 43 FCR 100 at 123-124. While, as I discussed earlier, Mr Logan may have exaggerated the hours he spent on administrative tasks in the period 1991 to as late as early 1994, I am not satisfied that I should reject his evidence generally about the hours he worked. Mr Logan's evidence about the time it took to perform his duties as a local representative could, if wrong, readily have been contradicted by evidence from the local representative who followed him. The failure to call that person permits me to more readily accept the evidence of Mr Logan as to the time it took him to perform his work: Jones v Dunkel (supra) per Menzies J at 312. Even from the Otisline records, it emerges that Mr Logan was, from time to time, required to do a call-back well after the time he ceased working. I am also satisfied that Mr Logan regularly worked for periods in excess of 38 hours per week. Did Otis have a valid reason for terminating the employment of Mr Logan Section 170DE(1) of the Act provides that an employer must not terminate an employee's employment unless there is a valid reason or valid reasons connected with the employee's capacity or conduct or based on the operational requirements of the employer's undertaking establishment or service. Of some importance in these proceedings is that s 170EDA provides that an employer is taken to have contravened s 170DE(1), if contravention is alleged, unless the employer proves there was a valid reason or reasons of the kind referred to in s 170DE(1). The case in justification of termination of Mr Logan's employment in February 1995 (which, notwithstanding the Judicial Registrar's view to the contrary, was not a constructive dismissal) involved each characteristic found in s170DE(1). That is, Otis points to Mr Logan's capacity and conduct and its operational requirements in support of the contention that it had a valid reason for the termination. At the heart of the case is the failure of Mr Logan to meet Otis's expectations of what he could do in the time available to him, at least in a notional sense, and the standard at which it was done. I should first indicate that the evidence of Mr Logan's failure to discharge his duties at an acceptable standard in 1990 (to an extent), in 1991 and in 1992 (to an extent), must be seen in context. At that time Mr Logan was experiencing marital problems. This was known by management in Otis and, in a sense, there was an acceptance of the impact that was having on his work. They did not terminate his employment, though it was canvassed in August 1992, and were encouraging him to improve. He did improve, as is apparent from my review of the evidence of his work performance in 1993. By the end of 1993 there was, in my opinion, no reasonable basis for criticising the standard of the repair and maintenance work Mr Logan was then doing in any technical sense, nor any basis of substance for suggesting he was not doing it in a timely and diligent way. However, by the end of 1993 and throughout 1994 there was a basis for criticising some aspects of the performance of his administrative tasks including the level of T sales secured by him in the Orange area. Mr Logan accepted that, at least in late 1994, he was tardy in submitting timesheets and also acknowledged the inadequacy of the presentations of his business plan at the September 1994 local representatives meeting in Newcastle. Both matters he explained by reference to his workload. The late timesheets, at least in September and October 1994 he explained were due to the pressure arising from the proposal to relocate, and being taken on two jobs involving construction work. This explanation was given in cross-examination in the proceedings before the Judicial Registrar and not subsequently challenged in cross- examination in the review. The reason based on the pressure to relocate is scarcely tenable. However the other aspect of his explanation may be more substantial. Indeed when being cross-examined about his contention that he spent 10 hours on administration, he was asked why there were complaints about his paperwork if this time was being spent on administration. His answer was, in substance, that he had to spend a lot of time servicing lifts and doing other work and he was often too tired to do the paperwork. This explanation is a plausible one and is consistent with the view I earlier expressed that Mr Logan probably exaggerated the amount of time he said he was devoting to administration. However the general acceptance of the evidence of Mr Logan about the hours he worked on repair and maintenance and associated travelling as well as out of hours call-backs and the limited installation work he did, provides an explanation why he underperformed in relation to the punctual submission of timesheets and the generation of T sales. Underperformance can constitute a valid reason within the meaning of s 170DE(1): see Hurskin v Australian Jewish Press Pty Ltd (1996) 69 IR 123; Brooks v Panalpina World Transport Pty Ltd (unreported, Industrial Relations Court of Australia, 25 March 1997, Patch JR). However in this case I am confronting underperformance in relation to two aspects of the work of a local representative in circumstances where the employer had an expectation that these aspects, together with the remainder of the duties, could be performed within a reasonable period in a working week. Otis has not established that they could be performed within a reasonable period in a working week, as it could have by calling the existing local representative. In the result, in my opinion, it has failed to demonstrate that the conceded underperformance in some areas of Mr Logan's work constituted a valid reason for the termination of his employment. Remedy This issue is a vexed one. The view adopted by the Judicial Registrar was that, in establishing a business in competition with Otis and using confidential information gained while employed by Otis, Mr Logan had caused an irretrievable breakdown of the relationship of employer and employee. Reference was made by the Judicial Registrar to an authority concerning restrictions on the use of confidential information by an employee or former employee. Counsel for Mr Logan sought to demonstrate that no confidential information was used by Mr Logan in securing work after the termination of his employment. However whether specific information was or was not used does not appear to me to be the critical issue and involves an approach that is too narrow. What, in my opinion, is of significance is that Mr Logan has now established himself in a substantial and material way, as a competitor of Otis in the area in which he was formerly employed generally to promote the business of Otis and advance its interests. He has divorced himself from the Otis persona and is promoting himself in his own right. Indeed he is, on a subcontract basis, working for a competitor of Otis, Schindlers Elevators Pty Ltd. It is, of course, understandable that he has done so. He is settled in the area, has a family to support and his principle skills are that of an electrical lift mechanic. Section 170EE posits two considerations in determining whether an order for reinstatement should be made, namely that the Court considers it is appropriate in all the circumstances and the reinstatement of the employee is not impracticable. These matters, and particularly the latter, have been recently canvassed by a Full Court of the Industrial Relations Court of Australia in Perkins v Grace Worldwide (Aust) Pty Ltd (unreported, 7 February 1997). It is to be remembered, however, that the power upon which these considerations operate can be exercised in two ways. It can involve reappointing the employee to the position in which the employee was employed immediately before the termination: see s 170EE(1)(a)(ii), or to another position on terms and conditions no less favourable than those on which the employee was employed immediately before the termination: see s 170EE(1)(a)(ii). The former would be as local representative in the Orange area. The latter would be in a position that afforded Mr Logan the same salary and conditions as a local representative but it could be a position fashioned by Otis that need not be in the Orange area. I return to this matter shortly. In either event the Court can order the employer to pay remuneration lost by the employee because of the termination: see s 170EE(b)(ii). In Perkins (supra), the Full Court endorsed, indirectly, observations of Wilcox CJ in Patterson v Newcrest Mining Limited (unreported, Industrial Relations Court of Australia, 6 June 1996) that: "The requirement to consider the impracticability of reinstatement necessarily requires the Court to have regard to all the relevant circumstances of the case relating to the employer and the employee; as I said in Nicolson, to evaluate the practicability of a reinstatement order in a common sense way." and observations of Wilcox CJ in Nicolson v Heaven and Earth Gallery Pty Ltd (1994) 1 IRCR 199 that: "It is important to note that Parliament stopped short of requiring that, for general compensation to be available, reinstatement be impossible. The word 'impracticable' requires and permits the Court to take into account all the circumstances of the case, relating to both the employer and employee, and to evaluate the practicability of a reinstatement order is likely to impose unacceptable problems or embarrassments, or seriously affect productivity, or harmony within the employer's business, it may be 'impracticable' to order reinstatement, notwithstanding that the job remains available." I do not propose to make an order under s 170EE(1)(a)(i). In my opinion, it is not appropriate in the circumstances of the case and it is impracticable. It would, to adopt the words of Wilcox CJ in Nicolson (supra), impose, in my opinion, unacceptable problems on Otis to order that Mr Logan assume, again, the public face of Otis in the Orange area after a period of now over two years in which Mr Logan has been battling, in a commercial sense, with that company. While there is little direct evidence of how Mr Logan has secured work, he has done so, in some instances, at Otis's expense. While it is not the subject of direct evidence, it is probable, in my opinion, that Mr Logan is now viewed by the consumers of lift maintenance and repair services in the Orange area as a person who can perform lift maintenance and repairs at prices more competitive than those hitherto charged or quoted by Otis and, for that and perhaps other less concrete reasons, is, by some, to be preferred to Otis. The image or persona of a company is an ephemeral concept but nonetheless real in the world of marketing and commerce. As emphasised in Perkins (supra), the issue of practicability is to be approached in a common sense way. However the problems I have adverted to would not arise in an area other than Orange. It is open to the Court to make an order under s 170EE(1)(a)(ii). The exercise of that power was considered by a Full Court of the Industrial Relations Court of Australia in Anthony Smith & Associates Pty Ltd v Sinclair (1996)67 IR 240. The Full Court said (at 244): "We have already set out the terms of s 170EE(1)(a)(ii) of the Act. The subparagraph empowers the Court to require the employer to reinstate the employee by appointing him or her "to another position on terms and conditions no less favourable than those on which the employee was employed immediately before the termination". This might be a specific position, the availability and suitability of which is revealed by the evidence. On other occasions, the Court will not specify a particular position. Provided that the Court is satisfied that reinstatement is practicable and appropriate, it is open to the court to make an order in terms of par (a)(ii), leaving it to the employer to choose the position and to comply with the Court's order to provide terms and conditions that are no less favourable than those on which the employee was employed immediately before the termination. If this course is taken, the employer may select an existing position, or he or she may create a new position for the purpose. If the latter, contrary to the submission of counsel for the employer, it will not be to the point that, in the absence of the order, the employer might not have created the position. We appreciate that creation of a new position may occasion a cost, or other disadvantage, to the employer. Where there is evidence that this will be so, that evidence may be relevant on the issues of practicability and appropriateness. But it would be contrary to principle to treat such evidence as necessarily determinative. The occasion for the order arises because the employer has acted unlawfully in terminating the employee's employment. A reinstatement order is akin to an injunction compelling a wrongdoer to restore the position of the innocent party. In considering whether to grant an injunction, a court will always take into account the consequences of an order to the wrongdoer but the existence of adverse consequences has never been regarded as excluding the possibility of an order being made." Whether an order should be made under s 170EE(1)(a)(ii) was not canvassed in detail, though written submissions filed by Otis on the question of practicability/impracticability emphasise its opposition to "the reinstatement of the applicant at Orange". By emphasising the words "at Orange", Otis was fairly plainly raising, by implication, the prospect of Mr Logan being appointed to another position located other than at Orange. But for the evidence concerning the persistent resistance of Mr Logan (while employed with Otis), to working elsewhere I would have ordered his appointment to an unspecified position that Otis may well have to create for him. I would have done so on the basis that his terms and conditions of employment would be the same as that of 'local representative' and that an order be made under s 170EE(1)(b)(ii) concerning lost remuneration. However, as noted by Wilcox CJ in the passage from Nicolson (supra) earlier quoted, practicability involves consideration of the circumstances of the employer and the employee. Given that Mr Logan is settled in the Orange area and that the clear impression I have gained from the evidence is that he does not wish to relocate, it would be impracticable to make an order under s 170EE(1)(a)(ii). The Judicial Registrar ordered $20,000 compensation. The approach of Wilcox CJ in May v Lilyvale Hotels (1995) 68 IR 112 to the assessment of compensation which was approved by a Full Court in Davis v Portseal Pty Ltd (unreported Industrial Relations Court of Australia, 10 April 1997), requires assessment of the loss of future remuneration and other matters that bear upon compensation and quantification of the cap created by s 170EE(3). The evidence concerning Mr Logan's remuneration after the termination of his employment is limited. In evidence are tax returns for Mr Logan personally for the financial year ending 30 June 1995 and for Logan Lifts Pty Ltd for the financial year 30 June 1996. In the former, apart from income received from Otis in that year of $34,242 (plus a lump sum payment of $9,292), Mr Logan's income was, it appears, a loss of $3,203 from primary production and gross business income of $3,474. The gross income for Logan Lifts Pty Ltd in the financial year ending 30 June was $14,898. This resulted in an operating loss of $7,132.56. Expenses incurred in that operating loss included salaries and wages of $2,000 paid, I infer, to Mr Logan. Thus the evidence, as far as it goes, suggests from February 1995 to 30 June 1996 a maximum income for Mr Logan of $5,474 for work of the type formerly done in the employ of Otis for which he was remunerated by the Company. Otis did not seek to establish that Mr Logan's income, since his termination, was of a magnitude significantly greater than that which emerged from the evidence. Thus the evidence sustains an inference that remuneration lost by Mr Logan since his termination in February 1995 exceeds, and may exceed by a significant margin, the amount awarded by the Judicial Registrar. However the Court cannot order more than, effectively, Mr Logan's remuneration from Otis for the six months preceding his termination, viz approximately $21,000. I see no basis for disturbing the order of the Judicial Registrar in relation to compensation. It is probably unnecessary to address the operation of s 170DC which I understood Mr Logan alleges was contravened. However, and I do not repeat the evidence, there was extensive consultation with Mr Logan. Contravention of s 170DC is not established. Liability of Otis under an Award (a) Did an award apply to Mr Logan's employment The awards identified by counsel for Mr Logan as possibly founding Otis's liability to pay Mr Logan for overtime, call-backs or standing by are the Metal Industry Award 1984 ("the 1984 Award") or the National Metal and Engineering On-Site Construction Industry Award 1989 ("the 1989 Award"). It was not in issue that Otis was a respondent to both awards. The 1989 Award came into effect on 19 April 1989. Any claim made by Mr Logan would be for a maximum period of six years before the commencement of the action to recover: see s 179(1)of the Act. While it is not a matter I need to resolve finally now, that would appear to be six years prior to the filing of the statement of claim on 24 January 1996. Thus, for present purposes, the relevant period commenced in January 1990 when the 1989 Award applied. As it related to on-site work, the 1984 Award was displaced by the 1989 Award. Thus it is convenient to consider the operation of the 1989 Award first. The 1989 Award applies to on-site construction work in the engineering, metal working and fabricating industries. The clause dealing generally with the application of the 1989 Award provides: 2 - APPLICATION (a) This award shall apply in the States of New South Wales, Victoria, South Australia Tasmania, Queensland and in the Australian Capital Territory. (b) Subject to the exceptions and exemptions specified in this award, this award shall apply to persons employed in the classification (sic) specified in this award on "on-site construction work" (as defined) who are in the Metal and Engineering Construction Industry as defined in clause 3 - Incidence of award, of the Metal Industry Award 1984 - part I as it existed prior to the making of appendix A On-site construction work (which incidence is set out in appendix A hereto) and interpreted in accordance with subclause 2(c) of this award. The definition of "on site construction work" is an extensive one but it includes: "On-site construction work" shall mean: (i) Metal trades work (as determined in accordance with subclause 2(c) herein) performed in the work of construction, fabrication, erection and/or installation work or work incidental thereto when it is carried out at a construction site which is specifically established for the purpose of constructing, fabrication, erecting and/or installing the following: (1) ... (5) lifts and escalators as prescribed in Part II. To give meaning to the relevant part of this definition, it is necessary to consider the clauses identifying the area of operation of Part II which provide: PART II - LIFT INDUSTRY 1 - TITLE This part shall be known as Part II - Lift industry. 2 - APPLICATION (a) Subject to any exceptions and exemptions specified herein, this Part shall only apply to electrical and metal tradesmen and their assistants who perform work in connection with the installation, major modernisation, servicing, repairing and/or maintenance of lifts and escalators. (b) The terms of this Part shall not operate so as to interfere with the continuation of the Lift Industry Agreement made on 8 January 1985 and lodged with the Australian Conciliation and Arbitration Commission. While the definition of on-site construction work refers to "construction, fabrication erection and/or installation work or work incidental thereof to", it is relatively clear that, in relation to the lift industry, the reach of the award includes employees engaged in lift maintenance and repair. The words "and/or" in cl 2 of Part II signify, in my opinion, that the concluding words in cl 2(a) which identifying various activities, should be read disjunctively: see Gurney v Grimmer (1932) 44 L1LRep 189; Norris Enterprises Pty Ltd v Hearney (1989) 14 QldLawyerReps 94; Carey v R R Hill & Co Pty Ltd (1989) 29 IR 442. That is, Part II applies to employees engaged in the repair and maintenance of existing lifts. Indeed Otis made no submission to the contrary. The real issue was whether Mr Logan was employed in a classification to which the 1989 Award applied. Part II concerns electrical and metal tradesmen and their assistants. It is plain from Part II read as a whole, that they are the tradesmen identified in cl 7 of Part I which relevantly provides: 7 - WEEKLY WAGE RATES (a) (i) Other than Classification ACT ACT (* = "as defined") $ $ ... Electrician special class* 350.30 350.10 ... Electrical mechanic* 325.90 327.20 ... Employee not elsewhere classified 265.50 266.60 Clause 36 in Part I contains definitions of some of these terms. It relevantly contains the following definitions: (7) "Electrical mechanic" means a tradesman mainly engaged on electrical installation repair and maintenance work. (8) "Electrician special class" means an electrical fitter or electrical mechanic who is mainly engaged on complex or intricate circuitry or both, the performance of which work requires the use of "additional knowledge" as herein defined. For the purpose of this definition "additional knowledge" means knowledge in excess of that gained by the satisfactory completion of the appropriate technical college trade course which has been acquired by the tradesman by virtue of his: (2) ... The critical question is whether Mr Logan was, while employed as a local representative, working as an electrician special class or an electrical mechanic. To be the former it is, for present purposes, necessary for Mr Logan to be an electrical mechanic with special knowledge or upon whom cl 3(e) in Part II operates. The starting point is thus to determine whether he was an electrical mechanic. Such an approach involves what I might describe as the traditional approach in determining whether an award applied a particular employee or group of employees and was the approach advocated by counsel for Mr Logan. I will later deal with the submissions made by counsel for Otis. In determining what are the appropriate principles to ascertain whether Mr Logan worked as an electrical mechanic, a convenient starting point is the judgment of Sheldon J in Ware v O'Donnell Griffin (Television Services) Pty Ltd [1971] AR(NSW) 18. His Honour was reviewing a decision of the Chief Industrial Magistrate that a Ms Violet Ware was employed in a clerical capacity. In issue was whether Ms Ware's employment was regulated by the Shop Employees (State) Award which contained an exclusionary provision which rendered that award inapplicable to a person employed in or in connection with a shop "in any clerical capacity whatsoever". The employment of such employees was regulated by an award made by the Clerks in Retail Shops (State) Conciliation Committee. Sheldon J observed: "The finding of the Chief Industrial Magistrate raises two questions: Firstly, whether this is a case to be determined on the principle of major and substantial employment; and, secondly, if it is, whether the evidence justified his finding as to what the major and substantial employment of the complainant was. It seems to me that this is clearly a case to which this principle is applicable. This principle is almost as old as industrial arbitration and it makes a practical approach to determining the application of awards where duties are of a mixed character and contain elements which have taken alone would be covered by more than one award. This is not an appropriate occasion on which to discuss the method by which this test should be applied expect to say that it is not merely a matter of quantifying the time spent on the various elements of work performed by a complainant; the quality of the different types of work done is also a relevant consideration. " There has been a division of opinion as to whether this principle applies only when considering which of two possibly applicable awards governs particular employment. This was the view expressed by Macken J in San Remo (Southland) Pty Ltd v Farrell (1987) 22 IR 291. A similar approach was adopted by Cahill J in Otto Waste Industries Pty Ltd v Klajman (1985) 34 IR 361. A survey of some of the more recent authorities is found in Robinson v Roxburgh & Alexander Pty Ltd t/as Power Price (1988) 25 IR 1 at 5-7. However more recent decisions of the Industrial Court of New South Wales reject the notion that the principle enunciated by Sheldon J should not be applied when considering whether a particular award regulates employment of a particular character. In Comdox (No. 272) Pty Ltd t/as Ronald Stead Golf v Dawson (1993)49 IR 458, Maidment J considered whether a particular employee was a shop assistant as that expression appears in the Shop Employees (State) Award. His Honour expressed the view that the approach of Sheldon J was an appropriate one to adopt in such a situation. In N E I Pacific Ltd v Nicholl (1994) 53 IR 355, Cullen J had to consider whether the employment of an employee was regulated by both the Metal Industry Award 1984 and the Metal Industry (Long Service) Award 1994. If it was, the provision of the Long Service Act 1955 (NSW) had no application to the employee. In issue was whether the employee was employed as a principal technical officer notwithstanding that some of his work might be characterised as that of management. His Honour appears to have applied the approach of Sheldon J in Ware (supra). His Honour concluded: "It seems to me that on any fair reading of the transcript of evidence, the findings of fact of the Chief Industrial Magistrate were reasonably open to him and the reasons for his findings were adequate for his decision. The respondent's responsibilities of management were greater than his technical input. This view is supported by the fact that at Wallerawang Power Station he had authority over the site manager, in regard to the management of the project. The latter had superior technical qualifications and later became the respondent's senior officer in a position which required by professional engineering qualifications and management skills. The respondents work was of a general management and co-ordinating nature and despite Mr Murphy's efforts could not be tailored to fit within the wage group structure of the Metal Industry Award 1984 which is based upon progressive specialised engineering skills streams. Further, other provisions of the award, such as over award payments and hours of work, were clearly irrelevant to the modus operandi of his employment. The Chief Industrial Magistrate, in my opinion, correctly assessed the quality of the management component of the respondent's work as being greater than the application of the limited technical qualification which his possessed and that the Metal Industry Award 1984 did not cover such work." The approach of Sheldon J or variants of it have been applied when not only considering whether a particular award applied to identified employment but also in determining whether an employee or group of employees were engaged in a particular occupation or calling in rules of registered organisations. An example is Prichard v Krantz (1983) 5 IR 437. It has also arisen in cases concerning the scope of industrial legislation: see Cliffs Road River Iron Associates v Seamen's Union of Australia [1974] LBC Current Review 200 and in Merchant Service Guild of Australia v J Fenwick & Co Pty Ltd (1993) LBC Current Review 5. In the latter case Ludeke J considered whether certain employees were "seamen" for the purposes of s 71(1) of the Conciliation and Arbitration Act 1904. The employees, as part of their duties, performed the work of masters and engineers on tugs, launches and similar vessels though engaged in other work as well. His Honour said: There was evidence that the time spent by the masters and engineers on the tugs while actually on towage operations occupied on 25% of these employee's total time. It was argued that it was only this portion of their duties that could be taken into account in considering they were seamen in the sense required by s 71(1) of the Act. If this view were adopted, it was said, it would follow that the employees were not masters or engineers, because the time spent on their duties in these respective capacities would not sufficient to qualify them as following the calling of tug master or engineer. I am unable to accept this submission. It may well be that en employee that spends twenty-five per cent of his time fulfilling the principal purpose for which his is employed qualifies by reason of that circumstance alone to be classified in the particular calling identified with that purpose. In this case, the employees in question are wholly occupied as masters or engineers, either in actual towage operations or in duties incidental to that purpose. I'm satisfied that these employees are following a calling which falls within the required definition of seamen." In the present case it appears to me appropriate to apply the principal enunciated by Sheldon J in Ware (supra). It is thus necessary to ask what the major and substantial employment of Mr Logan was. It is unnecessary to take the matter as far as might be suggested by the observations of Ludeke J in Merchant Service Guild of Australia (supra) as it is plain on the evidence that the major and substantial employment of Mr Logan, in both a temporal sense and as the defining feature of the employment, involved him maintaining and repairing lifts or similar equipment and associated travelling. That the majority of Mr Logan's work was of this character was conceded in evidence by Mr Bull, Mr Tull and Mr Gardiner. Indeed, in the advertising brochure, to which I earlier referred, Mr Logan's role is described in the following terms: "The local representative's primary role is to ensure the safe and reliable operation of your elevator and escalator equipment while also co-ordinating any specific requirement you may need answered by other departments of Otis." It may be accepted that Mr Logan was required to perform a range of other tasks. They were principally either administrative duties associated with the performance of repair and maintenance work, or selling products or services on behalf of Otis. However the clear picture emerging from the evidence was that the preponderance of the work Mr Logan did and his principal function was to repair and maintain lifts and allied equipment. While I do not doubt that Otis viewed his sales function and his general role of representing Otis in the Orange region as an important function, that does not, in my opinion, detract from what I view as his major and substantial employment. It was as an electrical mechanic. It was submitted on behalf of Mr Logan that he could be viewed as an "electrical special class", having regard to a deeming provision in the 1989 Award. Clause 3(e) in Part II provides: "(e) after an electrical tradesman has performed work away from the workshop for an employer party to the Lift Industry Agreement referred to in clause 3 hereof in connection with the installation, major modernisation, servicing repairing and/or maintenance of lifts and escalators for a period of not less than two years shall be classified as electrician - special class." There was no evidence that Otis was a party to the Lift Industry Agreement. However, at the commencement of the review, an attempt was made by counsel for Mr Logan to obtain the Lift Industry Agreement and the relevant file was subpoenaed from the Commission. Counsel intended to demonstrate that the provisions of cl 37H of the 1984 Award would operate to render the 1984 Award applicable to metal tradesmen who, inter alia, maintained and repaired lifts away from a workshop. Arguably it was necessary to prove the Lift Industry Agreement to show the 1984 Award applied in this way. However, after an exchange between the Court and both counsel, the production of the Agreement was not pursued. No express concession or admission was made by Otis that it was a party to that agreement though I gained the impression it was. If there is a residual issue about this matter it can be addressed before judgment is entered. However, Mr Logan has not, to this point, demonstrated that cl 3(e) applies. Mr Logan does not otherwise satisfy the definition of electrician special class. Counsel for Otis submitted that the terms of the contract of employment between Mr Logan and Otis avoided the provisions of either the 1984 or the 1989 Award. I understand this submission if it implies that obligations imposed and entitlements created by an award may be met, either in whole or in part, by payments made pursuant to the contract which might exceed, in some respects, minimum entitlements established by the award. This is an issue I consider shortly. I do not understand the submission if it implies that the terms of the contract render inapplicable either award, notwithstanding that the employment of Mr Logan is comprehended by the 1989 award, properly construed. I accept that a number of the observations of Cullen J in N E I Pacific Ltd (supra) provide some support for the approach advocated by counsel for Otis. His Honour noted that provisions of the award "were clearly irrelevant to the modus operandi of his employment". What this means is another matter. It is now trite law that an award imposes obligations on an employer and does so quite apart from the contractual relations between them: see Byrne & Frew v Australian Airlines Ltd (1995) 185 CLR 410. However if the award, properly construed, applied, on the evidence, to particular employment, then its applicability cannot depend on arrangements between the parties that may, in some respects, be inconsistent with specific provisions on the award. In my opinion, the 1989 Award applied to Mr Logan's employment as local representative in the Orange area. (b) Did an entitlement arise for payment for overtime Mr Logan contended he is entitled to be paid overtime for hours he worked in excess of 38 hours per week. This is said to arise under the 1989 Award or by virtue of an implied term of his contract of employment. The award provisions dealing with overtime must be read in conjunction with those prescribing hours of work. The relevant clauses are: "11 - HOURS OF WORK Day workers (a) Subject to clause 11A - Implementation of 38 hour weeks and subject to the exceptions hereinafter provided, the ordinary hours of work shall be an average of 38 per week to be worked on one of the following bases: (i) 38 hours within a work cycle not exceeding seven consecutive days; or (ii) 76 hours within a work cycle not exceeding fourteen consecutive days; or (iii)114 hours within a work cycle not exceeding 21 consecutive days; or (iv) 152 hours within a work cycle not exceeding 28 consecutive days. (v) For the purposes of subclause 11A(i) any other work cycle during which a weekly average of 38 ordinary hours are worked as may be agreed in accordance with subclause 11A(i). (b) The ordinary hours of work prescribed herein may be worked on any day or all of the days of the week, Monday to Friday. (c) The ordinary hours of work prescribed herein shall be worked continuously, except for meal breaks, at the discretion of the employer between 6.30 am. and 6.00p.m. Provided that the spread of hours may be altered by mutual agreement between an employer and the majority of employees on the site or section or sections concerned. Provided further that work done prior to the spread of hours fixed in accordance with this subclause for which overtime rates are payable shall be deemed for the purposes of this subclause to be part of the ordinary hours of work. (d) The ordinary hours of work prescribed herein shall not exceed ten hours on any day. Provided that in any arrangement of ordinary working hours where the ordinary working hours are to exceed eight on any day, the arrangement of hours shall be subject to the agreement of the employer and the majority of employees on the site or section or sections concerned. 14 - OVERTIME Payment for working overtime (other than shift work) (a) For all work done outside ordinary hours the rates of pay shall be time and a half for the first two hours and double time thereafter, such double time to continue until the completion of the overtime work. Except as provided in this subclause or subclause (c) hereof in computing overtime each day's work shall stand alone. For the purposes of this clause ordinary hours shall mean the hours worked fixed in accordance with clause 11 of this award. The hourly rate, when computing overtime, shall be determined by dividing the appropriate weekly rate by 38, even in cases when an employee worked more than 38 ordinary hours in a week. Requirement to work reasonable overtime (b) An employer may require any employee to work reasonable overtime at overtime rates and such employee shall work overtime in accordance with such requirement. The assignment of overtime by an employer to an employee shall be based on specific work requirements and the practice of "one in, all in" overtime shall not apply. Rest period after overtime (c) ... Call-back (d) An employee recalled to work overtime after leaving the site (whether notified before or after leaving the site) shall be paid for a minimum of four hours work or where the employee has been paid for standing by in accordance with subclause (g) hereof shall be paid for a minimum of three hours work at the appropriate rate for each time he is so recalled; provided that, except in the case of unforeseen circumstances arising the employee shall not be required to work the full three or four hours as the case may be if the job he was recalled to perform is completed within a shorter period. This subclause shall not apply in cases where it is customary for an employee to return to his employer's site to perform a specific job outside his ordinary working hours, or where the overtime is continuous (subject to a reasonable meal break) with the completion or commencement of ordinary working time. Overtime worked in the circumstances specified in this subclause shall not be regarded as overtime for the purpose of subclause (c) hereof when the actual time worked is less than three hours on such recall or on each of such recalls. Crib time (e) When an employee is required to work overtime (cribtime shall be provided) Meal allowance (f) An employee required to work overtime for at least one and a half hours after working ordinary hours shall be paid (a meal allowance) Standing by (g) Subject to any custom now prevailing under which an employee is required regularly to hold himself in readiness for a call-back, an employee required to hold himself in readiness to work after ordinary hours shall until released be paid standing-by time at ordinary rates from the time which he is so to hold himself in readiness. Transport of employees (h) When an employee, after having worked overtime and/or shift for which he has not been regularly rostered, finishes work at a time when reasonable means of transport are not available the employer shall provide him with conveyance to his home or the nearest public transport." I have not reproduced cl 11A which concerns the implementation of a 38 hour week. It is sufficient to say that cl 11A contemplates various methods of working a 38 hour week that depend on either agreement at a site level or agreement otherwise. There is no evidence of any agreement concerning the manner in which Mr Logan would work the 38 hour week or indeed any other employee of Otis. Thus the hours of work prescribed by cl 11 are an average of 38 per week that may be worked in a number of ways. They are to be worked Monday to Friday between the hours of 6:30am and 6:00pm unless otherwise agreed. It can be seen that the entitlement to overtime in cl 14 is expressed in terms of a payment "for all work done outside ordinary hours". Having regard to cl 11, work might be done outside ordinary hours in a number of ways. It might be worked on days of the week other than Monday to Friday: see cl 11(b). It might be worked at times outside the spread of hours between 6:30am and 6:00pm, assuming there was no agreement to vary those spread of hours: see cl 11(c). It may, in relation to one day, be hours worked in excess of 10 hours: see cl 11(d). It also may be hours exceeding an average of 38 hours per week worked in one of the ways identified in cl 11A. As to this last matter there is plainly a difficulty in identifying what hours might be worked in excess of an average number of hours in circumstances where cl 14(a) directs that in computing overtime each days work should stand alone. However the manner in which cl 14(a) would operate in relation to Mr Logan's employment is a matter that was not addressed in submissions in any detail. As the only finding I have made is that Mr Logan regularly worked in excess of 38 hours per week it will be necessary to address the operation of cl 14(a) when detailed evidence is called, if it ever is called, dealing with the quantum of Otis' liability. I should, however, now indicate that to the extent that Mr Logan was paid a salary exceeding the wage to which he was entitled as an electrical mechanic under the 1989 Award, Otis is entitled to off-set that amount against any amount ultimately found to be due to Mr Logan as payment for overtime and also in relation to call-backs which is a matter I discuss shortly. The applicable principal is that enunciated by Sheldon J in Ray v Radano [1967] AR(NSW) 471. It was adopted by a Full Court of the Federal Court in Poletti v Ecob (No. 2) (1989) 31 IR 321 at 333. It is that the payment of an amount as wages can be relied on by an employer in satisfaction of an award obligation to pay wages whether in relation to wages for ordinary time, overtime, weekend penalty rates or any other like monetary entitlement under the award. However if a payment is made under a contract either expressly or impliedly for some purpose other than the payment of wages, such as for fares or for a uniform allowance where there is no award entitlement to fares or a uniform allowance this cannot be relied upon as a set off for monies payable under the Award. In Poletti the Full Court rejected the finding of the Chief Industrial Magistrate that cash payments made to a foreman in a horse training establishment were referrable to overtime. The Full Court took the view that a cash payment made to the employee was in addition to the amount that had been agreed as the amount to be paid for all hours worked. This is to be contrasted with Mr Logan's circumstance. I am satisfied that both Mr Logan and those representing Otis shared an understanding at the time he was appointed local representative that the salary he would be paid was for both ordinary hours and any overtime, including call-backs, that he was to work. Accordingly the entire amount paid to Mr Logan by way of salary can be relied on by Otis as satisfying, either in whole or in part, any amounts due to Mr Logan as overtime payments or payments for call-backs in addition to the wage he was entitled to as an electrical mechanic under the 1989 Award. (c) Was Mr Logan entitled to be paid for call-backs or standing by It can be seen that cl 14 contains two provisions that may have application to Mr Logan's employment. Clause 14(d) entitles an employee to a minimum payment of 4 hours when recalled to work overtime. Clause 14(g) entitles an employee to payment at ordinary rates for periods where, after ordinary hours, an employee holds himself in readiness to work. It is clear from the evidence that there were occasions on which Mr Logan was required to attend to emergency breakdowns after he had completed his normal working day or at weekends. It is also clear from the evidence that, as a broad generalisation, he had to be ready to perform work outside his ordinary hours. It might be thought that one or other of these provisions could apply but not both. This is consistent with the view expressed in the CCH Australia, Labour Law Reporter at 30-740: "The concept of call-back is to be distinguished from employees who are on 'stand by'. The latter applied where an employee has been alerted by prior arrangement with the employer that he may be required to undertake duties if notified. An employee on 'stand by' is usually required to either to remain at his home or to make himself available by means of telephone of electronic communication if required to carry out work." However there are at least two comparatively recent decisions where an award or similar industrial instrument was viewed as entitling an employee to both a payment for standing by and call-back: see Electrical Trades Union of Australia, NSW Branch v Boral Hardies Pty Ltd (1993) 51 IR 412, Hyslop v Liverpool Hospital (1987) 21 IR 192. However it is plainly necessary, for present purposes, to address, the terms of the 1989 Award. I first consider the issue of standing by. A clause in similar terms to cl 14(g) was considered by the Commonwealth Industrial Court in Richards v Vinlon Pty Ltd (1971) 18 FLR 4232. In that case a claim had been made, by reference to cl 14(e) of the Metal Trades Award 1952, in relation to a leading hand electrician special class who had been required to stand by for emergency work over a weekend. The employer operated a factory on a 24 hours a day, 7 day a week basis. Over the weekend there were no tradespeople at the plant, though it was not uncommon for mechanical and electrical faults to occur. The employer had instituted a system in which a maintenance fitter and maintenance electrician would notify management that he was available to attend to fix faults over the weekend. The relevant provision in the award was: "subject to any custom now prevailing under which an employee is required to regularly to hold himself in readiness for a call-back, an employee required to hold himself in readiness to work after ordinary hours shall until released by paid standing by time at ordinary rates for the time from which he is so to hold himself in readiness: Provided that the existence of a custom shall not operate to relieve an employer from paying a refrigeration service man the rate herein prescribed." The Court expressed the following conclusion at 425: "It is quite clear that the claimant understood that on a weekend that he had indicated he availability he was bound to remain within reach of the telephone and to come into work if called. Indeed on the terms of his engagement he could scarcely be otherwise." The Court went on to express some of its conclusions in paragraph form: "(a) Whether a man made himself available under the system in respect of any weekend was his own decision. Entry into the system was therefore voluntary - but this is irrelevant with respect to the question as to what was required of him if he did make himself available under the system in respect of a particular weekend. (b)(i) The proper inference from the evidence is that once a man notified his availability for a particular weekend he was under an obligation during all that weekend to remain within reach of the company by phone and if called to work to go to the company's works to work. (ii) The Claimant having made himself available to work for a particular weekend did not have the right, at will, to notify that he was not available for some part of the weekend." The Court concluded that the employee was entitled to payment under the clause. Of interest is that the Court noted: In respect of the claimant's employment there was no prevailing custom such as is referred to in the clause." It is at least arguable that, apart from the effect of the opening words of para (g) concerning custom, Mr Logan would be entitled to payment under that paragraph. However, in my opinion, there was plainly a custom prevailing at the time the 1989 Award was made, and during the period in which the paragraph might otherwise have applied, that Mr Logan and other local representatives were required regularly to hold themself in readiness for a call-back. It is thus unnecessary to determine whether the word "now" directs attention to the time the 1989 Award was made or the time at which the provisions were said to operate and the entitlement was said to arise. In relation to the opening words of para(g), counsel for Mr Logan made two submissions. First, that they were a qualification on an entitlement and it was incumbent upon Otis to establish that the qualification applied and, in particular, prove the existent of the custom. Second, that there needed to be evidence that the custom relied on is well known and acquiesced in, notorious and certain in the way discussed in Con-stan Industries of Australia v Norwich Winterthur Insurance (Australia) Ltd (1986) 160 CLR 226 at 236 and reference was also made to Byrne & Frew v Australian Airlines (supra). However these authorities concern the existence of custom that would justify the implication of a term in a contract. For my part I do not see why the opening words of para (g) should be approached on the same basis. There is a line of authority in NSW dealing with what is comprehended by the notion "custom". In Hackshalls Ltd v McDowell [1930] AR(NSW) 620, Cantor J reviewed a finding of a Magistrate that a custom existed in an industry which precluded a bread carter from serving any of the customers of a former employer. The issue arose because a bread carter, during a period of one week's notice, was directed to work in a particular area, he refused and was then summarily dismissed. He claimed wages for the residue for the period of notice. It appears that the alleged custom was raised as a reason why the employee refused to do as directed and a justification for taking that position. Cantor J referred to Halsbury's Laws of England which defined custom as "a particular rule which has existed actually or presumptively from time to time immemorial and has obtained the force of law in a particular locality although contrary or not consistent with the general common law of the realm" His Honour concluded that the evidence fell short of establishing that there was a custom. The nature of "custom" arose again in the Furnace Demolishers case [1960] 59 AR(NSW) 670. Employees had refused a direction to undertake particular work. Beattie J was required to consider whether they were entitled to refuse to do the work because it was an implied term of their contract that they would not be required to do that work. His Honour concluded that no such custom had been established. His Honour referred to Halsbury's Laws of England as it concerned the notion of "usage". The issue again arose in Metropolitan Meat Industry Board re Collective Responsibility [1972] 72 AR(NSW) 80. Again it arose in the context of whether there was to be implied into the contract of employment a particular term. Reference was made to the Furnace Demolishers case (supra)and to Halsbury's. The matter was most recently considered by Watson J in Re Federated Ironworkers' Association of Australia NSW Division and Australian Fertilizers Ltd Re Overtime [1977] AR(NSW) 17. It is not entirely clear whether his Honour was simply determining whether there had been a "custom" or "practice" such as to imply a term into the contract of employment or whether there had been a "custom" and "practice" such as to justify, for reasons of industrial fairness, a decision, in essence, requiring the employer to perpetuate or give effect the custom and practice. His Honour concluded that there had been a practice which amounted to a "usage", of providing taxis to employees working overtime in certain circumstances. This conclusion was reached by reviewing the practice for the preceding 20 years at least. A similar issue arose in Sullivan v Comalco Aluminium Ltd (1985) 10 IR 237. Morling J was required to construe the Clerks (Comalco Group of Companies) Award 1981. A clause in the award prescribed hours of work as 40 per week, though the clause contained the following proviso: "(d) Where at the time of making this award the custom and practice in a particular establishment is to work normal hours less than that set out in subclause (a) such custom and practice is to continue." The clerical employees at a plant of the employer worked thirty-seven and a half hours per week at the time the award was made. His Honour was called upon to determine whether it could be said that there was a custom and practice at the establishment, upon which the proviso would operate, involving some of the clerical employees who took a half a day a month off to go shopping. His Honour concluded that these arrangements were not preserved by the proviso. Of importance, however, is that his Honour appears to have proceeded on the basis that the working of the thirty-seven and a half hours by the clerks constituted custom and practice, though it may be accepted that the award spoke of custom and practice in a particular establishment. However, in the present case, in my opinion, it is only necessary that it be demonstrated that a class of employee, namely local representatives, was required regularly to hold itself in readiness for a call-back. In my opinon, the evidence clearly enables an inference to be drawn that that was feature of the employment of local representative. Mr Bull's evidence was that as a local representative between 1968 and July 1984 he was remunerated for time spent on callouts and other work undertaken outside normal hours. It was a matter that, on his evidence, he raised with Mr Logan when the latter was appointed a local representative in Orange. As earlier discussed, Mr Logan was aware of that aspect of his employment. Moreover the draft job description for local representatives, dated 13 April 1994, which I referred to earlier in this judgment, refers to a duty of a local representative as maintaining "a 24 hour service for Otis equipment". Indeed Mr Logan's evidence was that he was required to be on 24 hours callout. From this evidence I can reasonably infer that at the time Mr Logan was appointed local representative in 1985 and before and following that time local representatives were required to make themselves available to attend to emergency breakdowns and the like. It was an ongoing feature of their employment. In my view, the exception found in the opening words of cl 14 (g) applied to local representatives. That the award would operate in this was is readily comprehensible. It is intended to confer upon employees a benefit if, on specific occasions, they are required to hold themselves in readiness to work outside ordinary hours. An example is the circumstance considered in Richards v Vinlon Pty Ltd (supra). In those circumstances the employee should be compensated for putting themselves in a position where they are ready to do what might be required of them. The qualification in the opening words is intended to exempt from its operation employees who traditionally and regularly might be required to return to work by way of a call-back. As I have just discussed, local representatives were of this latter class. Insofar as Mr Logan was called back after he had ceased his day's work or at weekends, I am satisfied he is entitled to payment under cl 14(d) of the 1989 Award. It is true that the clause speaks of being recalled to work "after leaving the site" and, impliedly, applies only to circumstances when an employee leaves a particular site and is recalled to work at that site. However it is to be remembered that cl 14(d) is in Part I, which is a part of the 1989 Award dealing with on-site construction. Its application to lift maintenance and repair by operation of Part II renders inappropriate a literal application of the provisions in Part I drafted, as they were, to apply to on-site construction. The purpose of cl 14(d) is to compensate an employee who is required to return to work after leaving it and returning home. By parity of reasoning a lift mechanic who is required to return to work, albeit at a lift that he or she may not have been working on that day, after ceasing work is entitled to payment under cl 14(d). Mr Logan is entitled to such payments. If, however, he was called to an emergency breakdown during his working day and consequently worked excess hours then those excess hours, would simply attract an overtime payment and not the minimum of four hours arising under cl 14(d). Liability of Otis Under Contract (a) Overtime In view of the conclusion I have reached about the applicability of the award provisions, it is probably unnecessary to address this issue. However given the finding I earlier made that Mr Logan and those representing Otis shared an understanding that he would be paid a salary and not paid for overtime, Mr Logan has not established a factual basis for implying the terms he contends for. (b) Notice It is contended by Mr Logan that he was entitled to reasonable notice and the payment in lieu of notice he received, one month's pay, does not represent reasonable notice. The evidentiary foundation for the contention is not made out. At one stage Mr Logan conceded, in effect, that one month's notice would be adequate. Counsel for Mr Logan has not demonstrated the position was one for which a longer period of notice would, by implication, have been adopted by the parties had they turned their mind to it when formulating or considering the contractual arrangements between them. Conclusion The only order I propose to make is to adjourn these proceedings to enable short minutes to be brought in by the applicant. While it may be a vain hope I do not discount entirely the possibility that the parties, guided, assisted or otherwise by these reasons, may reach an agreement by way of settlement that may better suit the needs of both of them, rather than a result flowing from the already expensive process of fully contested litigation that will, if the matter is not settled, necessarily continue. If such an agreed settlement involved Mr Logan working again for Otis, both parties may have salvaged something of worth from this litigation. If mediation would assist, it can be ordered. I certify that this and the preceding ninety-two (92) pages are a true copy of the Reasons for Judgment herein of his Honour Justice Moore. Associate: Alexandra George Dated: 20 June 1997 APPEARANCES Counsel for the Applicant: Mr R Alkadamani Solicitor for the Applicant: Haywards Solicitors Counsel for the Respondent: Mr J de Merick Solicitor for the Respondent: Barker Gosling Dates of Hearing: 14, 15, 16, 17, 18 October, 12, 13 December 1996 Date of Judgment: 20 June 1997