DECISION NO:210/97 CATCHWORDS INDUSTRIAL LAW -.TERMINATION OF EMPLOYMENT - complaint of UNLAWFUL TERMINATION - OPERATIONAL REQUIREMENTS - failure of a pilot to transfer - claim that REINSTATEMENT impracticable Workplace Relations Act 1996 (C'th) (formerly Industrial Relations Act 1988) Ss 170DE(1), DF(1)(b), (c) and (e), EA, EDA, EE(1) and (2) Civil Aviation Act (Com) 1988 Abbott-Etherington v Houghton Motors (1995) 63 IR 394 Johns v Gunns Limited (1995) 60 IR 258 Klingenberg and TWU v IR Cootes Pty Ltd (1995) 63 IR 366 Lupoi v Phillips Fox, (unreported) IRCA 485/96, Ritter JR, 3 October 1996 Nettlefold v Kym Smoker Pty Ltd (1996) 69 IR 370 Nicholson v Heaven and Earth Gallery Pty Ltd (1994) 1 IRCR 199 Perkins v Grace Worldwide (Aust) Pty Ltd, unreported, IRCA 15/97, Full Court, 7 February 1997 Thomas v Ralph Lynch, unreported, IRCA 627/96, Wilcox CJ, 20 December 1996 Tran v Callum Textiles, (unreported), IRCA 78/97, Ritter JR, 13 March 1997 ADAMS -v- ROYAL FLYING DOCTOR SERVICE OF AUSTRALIA WI 1009 of 1997 Before : RITTER JR Place : PERTH Date of Judgment : 4 July 1997 IN THE INDUSTRIAL RELATIONS COURT ) OF AUSTRALIA ) WESTERN AUSTRALIA DISTRICT REGISTRY ) WI 1009 of 1997 B E T W E E N: ANTHONY PETER ADAMS Applicant A N D: ROYAL FLYING DOCTOR SERVICE OF AUSTRALIA (WESTERN OPERATIONS) Respondent MINUTE OF ORDERS 4 July 1997 PERTH RITTER JR THE COURT DECLARES AND ORDERS THAT: 1. The termination of the employment of the applicant by the respondent contravened section 170DE(1) of the Workplace Relations Act 1996. 2. The respondent shall, within seven (7) days, reinstate the applicant by appointing him to the position of pilot at the Jandakot base of the respondent on terms and conditions no less favourable than those on which the applicant was employed immediately before the termination of his employment. 3. The employment of the applicant is deemed to have continued for all purposes from 5 September 1996 to the date of reinstatement in accordance with this order. 4. Within fourteen (14) days of the date of this order, the respondent pay to the applicant his loss of remuneration at the rate of $889.62 per week, less PAYE taxation at the appropriate rate, from 10 October 1996 to the date of reinstatement. 5. There be liberty to apply as to the terms of this order on not less than forty-eight (48) hours' notice to the other party. NOTE: Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules. IN THE INDUSTRIAL RELATIONS COURT ) OF AUSTRALIA ) WESTERN AUSTRALIA DISTRICT REGISTRY ) WI 1009 of 1997 B E T W E E N: ANTHONY PETER ADAMS Applicant A N D: ROYAL FLYING DOCTOR SERVICE OF AUSTRALIA (WESTERN OPERATIONS) Respondent REASONS FOR DECISION 4 July 1997 RITTER JR INTRODUCTION The applicant, Captain Adams, was employed as a pilot by the Royal Flying Doctor Service of Western Australia from April 1979 until his employment was terminated on 5 September 1996. This is an application under section 170EA of the Workplace Relations Act 1996 (the "Act") for a remedy in respect of the allegedly unlawful termination of employment of Captain Adams. The primary remedy sought is reinstatement of employment. The applicant contends that the termination of his employment was unlawful as it was terminated without valid reason, contrary to section 170DE(1) of the Act. The respondent disputes this. The respondent asserts that there was a valid reason for the termination of Captain Adams' employment, based on the operational requirements of the respondent. The respondent also contends that if the termination of Captain Adams' employment is found to be contrary to the Act, then it is impracticable in all of the circumstances to order reinstatement. The respondent presented its case first. It called as witnesses: 1. Mr Bruce Rathbone, the chief executive officer of The Royal Flying Doctor Service, Western Operations; and 2. Mr Stephen Lansell, the aviation and communication manager of The Royal Flying Doctor Service, Western Operations. Captain Adams gave evidence in support of his application. He also called as a witness, Captain Barry Hallett, another pilot employed by the respondent. In addition to the oral evidence, some 46 documents were tendered as exhibits. THE FACTS Generally, there was little dispute about the facts. Prior to 1 July 1995, The Royal Flying Doctor Service in Western Australia was operated by three separate proprietary limited companies. They were known as the Western Australian Section, which had air bases at Jandakot, Carnarvon, Meekatharra and Port Hedland, the Eastern Goldfields Section which had an air base at Kalgoorlie, and the Victorian Section which had an air base at Derby. Each section operated independently, although there was cooperation at many levels. Until 1 July 1996, Captain Adams was employed as a pilot by the Western Australian Section, and was based at Jandakot. After that, he was employed by the respondent until the termination of his employment on 5 September 1996. In the mid 1990s The Royal Flying Doctor Service in Western Australia was facing funding difficulties. The organisation is primarily funded by the State and Federal Governments. However, for the three years prior to 1995, government funding had decreased by three percent per annum. In addition, for two years there had been no adjustment for inflation. Mr Rathbone assessed that the funding of the organisation in the four years to 1995 had decreased in real terms by twenty percent. In addition, in the eighteen months to mid 1995, there had been an increase of seventeen percent in the number of patients that The Royal Flying Doctor Service had moved. By the end of July 1995, the Western Australian division of The Royal Flying Doctor Service had a deficit of $810,000. Mr Rathbone's appointment as chief executive officer commenced on 1 July 1995. This coincided with the commencement of operations of The Royal Flying Doctor Service of Australia, Western Operations ("Western Operations"). In general terms, Western Operations was a merger of the previously-existing three sections. The three sections were the equal owners of Western Operations. Western Operations also acquired the assets of the three sections. The aim of the formation of Western Operations was for The Royal Flying Doctor Service to operate more efficiently and economically. A letter dated 29 June 1995 was sent to Captain Adams by Mr Jorgensen, the general manager of The Royal Flying Doctor Service, WA Section. The letter dealt with the commencement of Western Operations. It explained to Captain Adams that his existing contract of employment with his parent section remained unaltered. Western Operations was to assume the administration and management of the contract for and on behalf of the parent section. The existing terms and conditions, entitlements and obligations to the parent section continued in accordance with the existing contract of employment. Around the same time, Mr Rathbone began a series of inquiries to ascertain ways in which the performance of the respondent could be improved. In doing this he was assisted by a report that he commissioned from KPMG on human resource management issues. As a result of these inquiries, Mr Rathbone said that it became apparent that there was a major inequity of service in Western Australia. This involved an inequitable distribution of resources. The main area of disadvantage was in the Gascoyne Murchison area. This area was largely serviced by the Carnarvon and Meekatharra bases. The Derby base was serviced by five operational pilots and three twin-engine turbine aircraft. The Port Hedland base was serviced by five pilots, one twin-engine turbine aircraft and one twin-engine piston aircraft. Turbine aircraft are faster than piston aircraft. The Carnarvon base was serviced by one pilot and one twin-engine piston aircraft. The Meekatharra base was serviced by two pilots, one twin-engine turbine aircraft and one twin-engine piston aircraft. The Jandakot base was serviced by eight operational pilots, two non-operational pilots, three twin-engine turbine aircraft and one twin-engine piston aircraft. The Kalgoorlie base was serviced by six operational pilots and four twin-engine turbine aircraft. To remedy the perceived deficiencies in the system, Mr Rathbone developed a plan to redistribute resources. The plan involved each base having five pilots with the Jandakot base also having a non-operational, chief pilot. The Jandakot, Kalgoorlie and Derby bases would each have three twin-engine turbine aircraft. The Port Hedland and Meekatharra bases would have two twin-engine turbine aircraft. The Carnarvon base was to be closed down. The major difference under the proposed system was that Meekatharra would become a 24-hour base and therefore provide greater coverage to the Gascoyne Murchison region. The Carnarvon base had, at best, provided 12-hour service. As there was only one pilot, he could only be on call for 12 hours at a time and fly for eight hours. At Meekatharra, the two pilots had provided a day-shift service only. The development of the new plan was a part implementation of two slogans which Mr Rathbone thought would underpin an improvement in the respondent's performance. The slogans were the development of "equity of access", and "back to the bush". A key part of the new plan was to develop a system whereby patients could be collected in the shortest possible time. As stated, the new plan involved five pilots at each base. It would involve a four-pilot roster with allowances for one pilot to be on annual leave, sick leave or the like. The aim was to provide 24-hour cover, seven days per week. In about March 1996, the proposed plan was discussed by Mr Rathbone with the State Health Department. The Health Department agreed to the implementation of the plan on proviso that its implementation occurred by 1 July 1996. The Carnarvon base was then effectively closed. In February 1996 the pilot had gone on six weeks' leave and the pilot was not replaced. The closure of the Carnarvon base created something of a political issue in the area. In particular, Mr Kevin Leahy, the Opposition Member for Northern Rivers, was involved in the issue. During the public discussion of this issue, Mr Rathbone gave a commitment that Meekatharra would have a 24-hour base by 1 July 1996. However, as will be seen, this did not eventuate. The respondent's employees were generally kept informed of developments. Mr Rathbone said that in late February 1996, there was a meeting with the Australian Federation of Air Pilots ("AFAP") to facilitate the pilots being informed of what was proposed. Mr Rathbone did not attend this meeting but Mr Lansell and Captain Dick Tippett, who was to become the chief pilot of Western Operations, attended on behalf of management. On 1 March 1996, Captain Tippett issued two memoranda to all Western Operations pilots. This included Captain Adams, as a pilot operating from Jandakot air base. The first memorandum had as its subject "Meekatharra - a 24-hour base". The memorandum advised that the Western Operations Council had approved the upgrading of Meekatharra base to a 24-hour facility. It advised that to achieve 24-hour coverage, the pilot numbers at Meekatharra would be increased by two. The second memorandum concerned expressions of interest in redundancy. The memorandum sought expressions of interest regarding possible redundancies within the WA section pilot body. The memorandum advised that "with the advent of 24-hour operations at Meekatharra in line with 'back to the bush', there will be a reduction in flying from the Jandakot Base relating to the increase in flying at Meekatharra and increased Inter Hospital Transport throughout". The memorandum advised that whilst the change had "not been fully qualified", a reduction in pilot numbers at Jandakot was anticipated. The memorandum said that as it was appreciated that changes to Jandakot numbers could cause "severe disruption" to some staff members, Western Operations was seeking to minimise such effects by seeking expressions of interest in possible redundancy. A memorandum on the same subject was issued by Captain Tippett on 5 March 1996. The memorandum did not contain any more details about the reduction in pilot numbers at Jandakot base. The memorandum made it clear that pilots providing an expression of interest were in no way making a commitment to take a redundancy package. On 15 March 1996, Captain Adams completed a pro-forma indicating an interest in redundancy with a preferred departure date of approximately 6 May 1997. A memorandum was also issued to all Western Operations pilots from Mr Lansell on 5 March 1996 concerning changes to the pilots' structure in Western Operations. The memorandum said that its purpose was to clarify the current reporting lines and give details of planned changes to the structure of Western Operations. The memorandum made reference to the Air Operator's Certificates ("AOCs") held with the Civil Aviation Safety Authority by the different sections of The Royal Flying Doctor Service in Western Australia. Each section had a chief pilot as required by their AOC. The memorandum advised that matters of a professional aviation nature should now be directed through the respective section AOC chief pilots to Captain Tippett as chief pilot for Western Operations. The memorandum advised that once the Western Operations AOC was established in June 1996, the role of section chief pilots would disappear. The memorandum said that "teething troubles are bound to occur through this transition and your tolerance is requested. Pending the changeover, the section chief pilots still retain their direct responsibility to CASA for operations within the authority of the AOCs". (CASA stands for the Civil Aviation Safety Authority.) The memorandum advised that various regions had been established within Western Australia with administrative and operational responsibilities for the service provided in their area. The memorandum listed three regions being northern, southern and eastern. The northern region covered the Derby and Port Hedland bases, the southern region covered the Jandakot and Carnarvon bases and the eastern region covered the Meekatharra and Kalgoorlie bases. The memorandum also mentioned the administrative head of each region. The memorandum said that the chief pilot of Western Operations will be responsible for professional aviation aspects including the Western Operations AOC. An attached organisation chart detailed the professional and administrative structures that were established. The memorandum mentioned that a further change was the upgrading of the Meekatharra base to a 24-hour facility to significantly improve the service delivery to the Murchison Gascoyne region as well as enhancing the inter-hospital transfer capacity for the northern region. The memorandum said that the pilot numbers at Meekatharra will need to be increased by two as a result of the initiative. The timing of the change was to be announced. On 20 March 1996, Captain Tippett wrote to Captain Adams about his expression of interest in voluntary redundancy. The letter requested a meeting to discuss potential negotiations. Captain Adams replied by letter dated 22 March 1996. The letter appears to have been written by Captain Adams both in his personal capacity and that of the Jandakot base representative of the AFAP. The letter advised that Captain Adams was advising members not to meet with Captain Tippett because undertakings given by Captain Tippett in two areas had not as yet been fulfilled. The first was that intended pilot numbers at Jandakot had not been determined and the second was that there had been no consultation with pilot representatives or the AFAP about redundancy package details. On 25 March 1996, Captain Tippett issued a memorandum to all WA section pilots concerning pilot vacancies at Meekatharra. The letter advised that following Meekatharra being upgraded to a 24-hour base, vacancies existed for two line pilots based at Meekatharra. The commencement date was listed as 1 June 1996. Another memorandum of the same date was issued to all WA section pilots by Captain Tippett concerning the proposed "consolidation" of the Carnarvon base. The memorandum advised that negotiations were in progress with the WA Health Department and other interested parties in the Gascoyne region concerning the proposed consolidation of Carnarvon operations to Meekatharra. The memorandum advised that should the consolidation take place, additional flying would be covered by the Meekatharra base. Captain Tippett advised that his understanding was that a positive answer would be known in approximately one month. Another memorandum dated 25 March 1996 was issued by Captain Tippett to all pilots concerning pilot numbers at Jandakot base. The memorandum advised that with the establishment of Meekatharra as a 24-hour base, there would be a transfer of some flying carried out by Jandakot based pilots. The memorandum advised that the proposed consolidation of Carnarvon had the further potential to reduce Jandakot flying. The memorandum advised that under the regionalised structure of Western Operations, the Jandakot base was to be operated by five pilots. The memorandum advised that to minimise personal disturbance, the management of Western Operations had sought expressions of interest for voluntary redundancy from WA section pilots. The memorandum advised that this process was currently under way. On 8 May 1996, a meeting took place between representatives of the AFAP and Western Operations management to discuss the proposed changes. Captain Tippett and Mr Lansell attended on behalf of Western Operations' management. Captain Adams and Mr Laurie Cox, a senior industrial officer with the AFAP, attended the meeting on behalf of the AFAP. During the meeting, the AFAP suggested an alternative arrangement to increase the pilot numbers at Meekatharra. The suggestion was for a system of rotating temporary placements at Meekatharra. Captain Adams said that the aim of the AFAP proposal was to put forward a suggestion which would cause the least disruption to the lives of the pilots based at Jandakot while still meeting the operational requirements of the respondent in its upgrading of the Meekatharra base. Captain Adams said that the people present seemed attracted to the proposal, but it was ultimately rejected by the respondent. The proposal was reported to Mr Rathbone. Mr Rathbone said that he considered the proposal and discussed it with others. However, he considered that the proposal would be more expensive than permanent location of pilots at Meekatharra and would be contrary to the need that he perceived for having "solid base teams". Mr Rathbone said that if pilots were to come and go from the Meekatharra base, there would be likely to be a lessening of a sense of teamwork at the base. A memorandum from Mr Lansell to Mr Cox dated 17 May 1996 conveyed the decision of management. The first part of the memorandum reviewed the regional structure proposed for Western Operations. The memorandum said that except for the fact that there were two surplus positions at Jandakot and a shortfall position of two at Meekatharra, the overall pilot numbers in Western Operations were in line with the structure proposed by management. The memorandum said that the vacancies at Meekatharra were advertised within the Western Australian section initially and subsequently within the other two sections. However, no applications had been received by the closing date. The memorandum then referred to the proposal of the AFAP. The memorandum advised that after considerable deliberation, management was not agreeable to the proposal "on the grounds of the additional cost both in terms of dollars and days off in lieu, and the inability to establish the appropriate Meekatharra base team focus. We therefore propose to fill the Meeka positions on a permanent basis and shall give written notice to the pilots concerned in accordance with the relevant positions of the Award". The reference to the Award was a reference to the Pilots (General Aviation) Award, 1984. Clause 51 of the Award deals with the permanent transfer of pilots. Clause 51(a) defined a permanent transfer to mean the transfer of a pilot from home base to a new home base, where the period of the transfer is expressed prior to be in excess of 180 calendar days or where the length of the transfer does in fact subsequently exceed 180 days. Clause 51(f) provides that a pilot shall be given no less than 56 days written notice by his employer of an intended permanent transfer, provided that within this period the pilot shall be given at least 28 days written notice of the actual date of the transfer. The subclause provides that the pilot and the employer can mutually agree to a shorter period of adequate notice. By letter dated 16 May 1996, Mr Rathbone, as chief executive officer of Western Operations, wrote to Captain Adams "to confirm an offer of employment to you with RFDS Western Operations commencing from 1 July 1996". The letter advised that the terms and conditions that currently applied to his employment with RFDS WA section would continue. Entitlements in respect of annual leave, sick leave and accrued long-service leave would also continue. The letter also advised that the change in employer would not affect the application or operation of the Award. The letter requested that Captain Adams sign an attached copy of the letter and return it to Mr Rathbone by 31 May 1996 as acknowledgment of acceptance of employment with Western Operations. Captain Adams signed the acceptance of the offer of employment with Western Operations on 29 May 1996 and forwarded this to Mr Rathbone. By letter dated 4 June 1996 Mr Rathbone acknowledged receipt of the signed copy of the acceptance of employment with Western Operations, from 1 July 1996. On 31 May 1996 Captain Tippett wrote to Captain Adams. The letter referred to the pilot vacancies at Meekatharra base. It expressed the view of Western Operations that there were two more pilots than the number needed at Jandakot and insufficient pilots at Meekatharra. The letter therefore advised that in accordance with the Pilots (General Aviation) Award 1984, Captain Adams was being given no less than 56 days notice of his permanent transfer from the Jandakot base. The letter also referred to the right of Captain Adams to bid for a pilot's position at another base. This was a reference to a practice known as "bumping off". The practice allowed pilots to take the position of those more junior at particular bases. For example, if Captain Adams was more senior than a pilot at the Port Hedland base, he could effectively declare his desire to take that position and then replace ("bump off") the more junior pilot. In August 1996, nine of the ten most senior pilots were located at Jandakot. Captain Adams was in sixth position. Captain Schouten was in seventh position. The respondent also purported to transfer Captain Schouten's employment to the Meekatharra base at the same time as that of Captain Adams. Captain Tippett sent another letter to Captain Adams dated 26 June 1996. The letter referred to the earlier notice of intended permanent transfer. The letter said that it had come to Captain Tippett's attention that Captain Adams may be of the view that Western Operations was not his employer and therefore unable to transfer him. The letter referred Captain Adams to the letter dated 29 June 1995, which I have referred to earlier. I will later refer to the argument that Western Operations was not then the employer of Captain Adams. The letter then advised that in accordance with the Award, notice was given that the actual date of transfer would be 27 July 1996. The letter again mentioned the entitlement of Captain Adams to bid for other appropriate positions. Captain Adams was advised by the letter that if he wished to make a bid, he should do so in writing prior to close of business on 5 July 1996. The letter said that Captain Adams should feel free to contact Captain Tippett with any questions or concerns that he had. The letter concluded that unless Captain Adams contacted Captain Tippett to discuss any questions or unless a bid was provided in writing as requested, Captain Tippett would proceed on the basis that Captain Adams would transfer permanently to the Meekatharra base effective from 27 July 1996. The next letter in the sequence of events was from Captain Tippett to Mr Cox dated 15 July 1996. The letter referred to the fact that neither Captain Adams nor Captain Schouten had made any bid for a position by 5 July 1996. The letter said that discussions with Captain Adams indicated that he did not recognise the directions given from Western Operations and that Captain Schouten held the same view. The letter said that both seemed to have a grievance. The letter therefore sought an immediate conference in Perth with Mr Cox, Captain Adams and Captain Schouten in accordance with clause 55 of the Award to resolve what appeared to be a grievance held by both pilots. Following this, a conciliation conference took place at the Australian Industrial Relations Commission (the "AIRC") on 25 July 1996. Captain Adams and Captain Schouten did not attend at this conciliation conference. The conciliation conference was adjourned to 7 August 1996. On 31 July 1996, Captain Tippett wrote to Mr Cox about the conciliation conference. The letter attached a settlement proposal that had been put by the respondent at the conciliation conference on 25 July 1996. This involved Captain Schouten permanently transferring from Jandakot base with effect from 25 August 1996. Captain Schouten would be entitled to bid in accordance with the seniority procedure by 29 July 1996. Captain Adams was to be temporarily transferred to Meekatharra effective from 5 August 1996. The relevant clause, 52, of the Award was to the apply to the temporary transfer. Captain Adams' transfer would become a permanent transfer if either the AOC was issued to Western Operations in the same terms and conditions as currently apply to pilots at Jandakot or if it was issued in terms and conditions which gave Western Operations even greater flexibility. The permanent transfer of Captain Adams would then come into operation at the expiry of four weeks after the date of issue of the AOC. Captain Adams would then have a further period of one week to notify Western Operations of any bid that he wished to make in accordance with the applicable seniority procedures. The letter to Mr Cox dated 31 July 1996 referred to Captain Tippett's understanding that the settlement proposal was rejected by Captains Adams and Schouten. The letter requested that in order to facilitate proceedings on 7 August 1996, the reasons why Captains Adams and Schouten had rejected the settlement proposal be provided. The letter requested a written response by close of business on 2 August 1996. The letter also requested that Captains Adams and Schouten be present at the conference on 7 August 1996. No reply to this letter was tendered, although Captain Adams did attend at the conciliation conference on 7 August 1996. However, the matter was apparently not settled at that conference. A letter dated 23 August 1996 was sent from Captain Tippett to Captain Adams, with a copy to Mr Cox. The letter referred to the notice of permanent transfer and Captain Adams' failure to comply with this. The letter then referred to the conciliation conference. The letter said that during the conciliation process, operational matters had been raised by Captain Adams. The letter asserted that these were matters for management and that Western Operations did not agree with the arguments advanced by Captain Adams. The letter said that Captain Adams also argued that a redundancy situation had arisen. However, the letter stated that Western Operations did not accept this. The letter said that no personal reasons had been put forward by Captain Adams for not wishing to be permanently transferred. The letter also referred to an understanding that Western Operations had from other sources that it may be argued the notices of transfer were not valid. The letter said that Western Operations did not know the basis of the contention but that it could not afford the delay of issuing further notices to meet any technical objections that may be held. The letter then said:- "Western Operations requires that you place on open record and set out the basis of all your objections, technical and otherwise, to the transfer so that urgent consideration can be given to such matters without further delay and the purpose of this letter is to afford you a period of seven days to advise Western Operations in writing of such reasons. If you fail to provide such written reasons within seven days of the date of this letter, Western Operations shall have no alternative but to terminate your employment based on its operational requirements which require that the manning of Jandakot be reduced and that the vacant positions at Meekatharra be filled." Mr Rathbone said that this letter was issued after discussions with him. Mr Rathbone said that at the time, he did not clearly understand the reason for any objection by Captain Adams to the transfer. Mr Rathbone said that if Captain Adams and Captain Schouten refused to transfer to Meekatharra, it would be necessary to appoint new pilots to the respondent to take up the positions at Meekatharra. Mr Cox wrote a reply to this letter on behalf of both Captain Adams and Captain Schouten. The letter was addressed to Mr Rathbone. The letter appears to have been sent by facsimile to Mr Rathbone on 29 August 1996. Captain Adams said in evidence that this letter and a subsequent letter, which will be referred to below, were both written by Mr Cox on his behalf The letter commenced with a request that communications to the pilots be addressed through the AFAP. The letter stated that Western Operations had previously been advised of the pilots' preference that communications be addressed through the AFAP. The letter then raised six substantive points in response to the issues raised in the letter of 23 August 1996. Paraphrasing, these were: 1. The AFAP had notified a dispute to the AIRC regarding "a number of issues that directly impact on this matter and the question of pilot numbers generally within the section" 2. Whilst Western Operations took over the employment contract on 1 July 1996, no instructions have been forthcoming directing the pilots' transfer from that body. 3. The signature on recent correspondent had been Captain Tippett as chief pilot, Western Operations, although to the information of the AFAP, Captain Tippett held no such authority. 4. The respondent has not been acting in accordance with the Pilots (General Aviation) Award and the RFDS Pilots Seniority Award 1996. No particulars were provided of this allegation. 5. A number of other pilots' positions had been declared to be redundant and pilots treated in that way and "the service should now take steps to rectify the present situation in accordance with the Awards". Again, no particulars were provided of this. 6. Personal difficulties of both Captain Adams and Captain Schouten in relocating were specified. With respect to Captain Adams, the letter referred to the fact that he had been based at Jandakot for many years, he had purchased property as to which he would suffer significant losses if required to move and the emotional distress that Captain Adams and his immediate family would suffer from a country transfer. The letter concluded by expressing the disappointment of the AFAP in the way in which the employees had been dealt with. The letter said that the "most disgraceful attempt to intimidate the pilots by the threat of termination of employment will not go unchallenged". The AFAP requested that this threat be withdrawn or "we will take the matter further in the appropriate bodies and in a public manner". When Mr Rathbone received this letter, he wrote a note on it to Captain Tippett and Mr Lansell. The note mentioned that serious complaints against the response of the respondent in the Gascoyne Murchison region continued to mount and the operational requirement to bring Meekatharra up to the required performance outfit within financial capacity continued to become more pressing each day. The note stated that Captain Tippett should proceed without delay in taking counsel on the company's rights and obligations in the matter and on the basis of that advice, implement whatever reasonable actions that are necessary to achieve the company's structural and performance objectives. Following this, Mr Rathbone sent a letter to Mr Cox dated 2 September 1996. The letter said that Mr Rathbone had fully considered the matters raised in the letter from Mr Cox and had discussed them with his colleagues. With respect to the points raised in the letter of Mr Cox, Mr Rathbone replied as follows: 1. The respondent acknowledged that the AFAP had notified a dispute to the AIRC. The notification of the dispute said that it concerned hours of duty, redundancy, permanent transfers and taking of leave. The letter said that the notification did not set out the precise nature of the issues said to be involved. Further, during proceedings before the AIRC, nothing was said by the AFAP that indicated to Western Operations that anything contained in the AFAP notification directly impacted on the permanent transfer of Captain Adams and Captain Schouten. The letter said that Western Operations made it clear during the proceedings that it did not consider that any matters raised by the AFAP directly impacted on the permanent transfer of the two pilots. 2. The letter from Mr Rathbone asserted that the claim in Mr Cox's letter was not correct. Mr Cox was referred to the notice issued by Western Operations dated 31 May 1996 and the letters dated 26 June 1996 and 23 August 1996 on Western Operations letterhead. 3. Mr Rathbone's letter advised that Captain Tippett holds the position of chief pilot in Western Operations. The letter said that he is therefore responsible for administering pilot affairs and had the authority to issue the notices and correspondence in question. 4. Mr Rathbone said that he did not understand the claim. The letter referred to the fact that there was no basis set out on which it was alleged that the Awards had not been followed. 5. Three pilots specified in the letter from Mr Cox were each referred to. The letter then said that when these three pilots left, the number of pilots at Jandakot was reduced to seven. The letter said that with seven pilots at Jandakot, there is now no surplus because Western Operations desired a five-pilot operation at Jandakot and to permanently transfer Captains Adams and Schouten. Mr Rathbone's letter therefore asserted that there was no redundancy. The letter also referred to the lack of particularity about the claim that the respondent should take steps to rectify the present situation in accordance with the Award. 6. Mr Rathbone said that the personal circumstances of both pilots had been fully considered. Mr Rathbone's letter said that "the only conclusion I can draw from your letter as a whole is that you remain of the view that Captains Adams and Schouten's positions should be declared redundant and that the unspecified issues should be first resolved". The letter then said that given the operational imperatives bearing upon the respondent, it needed to fill the two pilot vacancies at Meekatharra urgently. The letter said that Mr Rathbone could "only infer from your response that Captains Adams and Schouten have no intention of accepting any transfer and that you require Western Operations to treat the situation which has arisen as a redundancy. I invite you to put your argument to me in writing as fully as you can as to why you consider this to be so, or if I have misunderstood your letter, I invite you to set out exactly what you believe should be done to resolve the situation". The letter concluded with the statement that unless a response was received that Mr Rathbone considered satisfactory by 5 pm on 4 September 1996, a final decision would be made by Western Operations and the likely result was the termination of the employment of both pilots. Mr Cox replied by letter dated 4 September 1996. With respect to the first five numbered points in the letter of Mr Rathbone, the letter advised as follows:- 1. The issues raised by the notice to the AIRC would impact upon the whole of Western Operations and directly upon Captains Adams and Schouten through forced redundancy from the Perth base. 2. It was acknowledged by each pilot that Western Operations took over the employment contract on 1 July 1996. 3. Captain Tippett is the chief pilot nominee only; he holds no official position as such, due to no AOC being issued for Western Operations. (The latter part of this assertion was acknowledged as being factually correct by the respondent during the hearing.) 4. The concerns of the AFAP about the non-compliance with the Awards was explained during the conference at the AIRC. The letter said "I trust that has been correctly reported to you". No further particulars were provided. 5. The AFAP maintained that "should the eventual position occur of redundancy being forced on the pilots at Jandakot we will be seeking an appropriate package, such as that discussed during the conference in AIRC". The penultimate paragraph of the letter said that the respondent was obligated by Award to call for bids for transfers in relation to the vacancies at Meekatharra. The letter then said that "should surplus to requirements exist following determination of the issues which are still before the AIRC, then the issue of redundancy will be raised at that time". The letter concluded with the hope that all alternatives be explored prior to any action such as termination of employment. There was no direct response to this letter. Instead, a letter was written to each of Captain Adams and Captain Schouten on 5 September 1996 terminating their employment. The first paragraph of the letter to Captain Adams listed the correspondence from Western Operations to Captain Adams and from the AFAP to Western Operations. The letter said that having fully considered the matters raised by the AFAP on behalf of Captain Adams, Western Operations had no alternative but to terminate employment based on operational requirements. The letter advised that five weeks' compensation in lieu of notice was being paid. The letter requested that Captain Adams return to Western Operations by 5 pm on 6 September 1996, all property of Western Operations in his possession or control. The letter enclosed a cheque for $9,374.03, representing Captain Adams' entitlements and payment in lieu of notice. A statement of the termination payment was also attached. Following the termination of their employment, both Captain Adams and Captain Schouten commenced proceedings under the Act in the AIRC for a remedy in respect of the allegedly unlawful termination of their employment. Mr Rathbone said in evidence that the application of Captain Schouten had been settled. Captain Schouten had not been reinstated but had been subsequently employed by the respondent as a casual employee, at the Jandakot base. THE VALIDITY OF THE TRANSFER NOTICE Mr Cox, for the applicant, in his closing, submitted that the notices to Captain Adams to transfer to the Meekatharra base as contained in the letters from Captain Tippett on 31 May 1996 and 26 June 1996, were invalid. Firstly, it was submitted that the transfer notices were invalid in that they were not issued by Captain Adams' employer. Specifically, it was asserted that the transfers purported to be issued by Western Operations, when at the time of their issue, Captain Adams was not employed by Western Operations but by The Royal Flying Doctor Service, WA Section. It is correct that both of these letters were sent on Western Operations' letterhead. Both letters purported to be signed by Captain Tippett on behalf of Western Operations. It is also correct that at the time the letters were sent, Captain Adams was not employed by Western Operations. The letter from Mr Rathbone to Captain Adams dated 16 May 1996 confirmed that the commencement of employment with Western Operations was from 1 July 1996. However, it does not necessarily follow from these facts that the notice of transfer was not validly given by Captain Adams' employer. Captain Adams was advised by the letter from Mr Jorgensen on 29 June 1995 that Western Operations was to assume the administration and management of his contract of employment for and on behalf of The Royal Flying Doctor Service , WA Section. Therefore, as Captain Adams was advised, Western Operations was acting as the agent of The Royal Flying Doctor Service, WA Section, with respect to the administration of his contract of employment. Accordingly, Western Operations was validly empowered to issue a notice of transfer to Captain Adams as it purported to do by the letters sent in May and June 1996. Secondly, Mr Cox submitted that the notices of transfer could not be validly issued by Captain Tippett as he was not the chief pilot of the entity which employed Captain Adams and held an AOC. It was submitted that only such a person could validly issue a notice of transfer. At the time of both notices of transfer being issued, Western Operations did not hold an AOC. The Royal Flying Doctor Service, WA Section, still held the AOC for The Royal Flying Doctor Service operations at Jandakot base, where Captain Adams was stationed. The chief pilot of The Royal Flying Doctor Service, WA Section, at the relevant time was a Captain Bleus. This submission of Mr Cox is reliant upon Civil Aviation Order Part 82 issued pursuant to the Civil Aviation Act (Com) 1988. This part of the Civil Aviation Order applies to AOCs. The scheme of the part appears to be that generally the Civil Aviation Authority will require a chief pilot to be appointed by an air operator. Subsection 5.1 provides that where a chief pilot is required to be appointed by an operator, it is a condition of the operator's certificate that the operator will comply with the requirements of Appendix 1 of the section. Appendix 1 provides for the approval of chief pilot, responsibilities of chief pilot, delegation by chief pilot, qualifications of chief pilot, approval of chief pilot by the Civil Aviation Authority and cancellation or suspension of approval. Clause 2 concerns the responsibilities of chief pilot. It is this clause upon which the applicant sought to rely. Clause 2.1 provides that the chief pilot is to have control of all flight crew training and operational matters affecting the safety of the flying operations of the operator. Clause 2.2 states that the responsibilities of a chief pilot must, unless the Civil Aviation Authority otherwise specifies in writing, include ten listed responsibilities. The applicant pointed in particular to subclause 2.2(b), the responsibility of arranging flight crew rosters and subclause 2.2(j), the responsibility of allocating appropriate aircraft. The applicant submitted that it was a necessary consequence of the chief pilot being responsible for operational matters, arranging flight crew rosters and allocating appropriate aircraft that the chief pilot be responsible for the transfer of a pilot from base to base. The evidence of Captain Hallett was that Captain Bleus maintained the responsibility of arranging flight crew rosters and allocating aircraft up to and beyond the date of termination of Captain Adams' employment. I am unable to accept the applicant's submission, that by reference to subclause 2 of Appendix 1 to the Civil Aviation Order, only the chief pilot could validly transfer a pilot. I am not satisfied that the transfer of a pilot is an operational matter. In my opinion, it is properly characterised as an administrative matter. It must be accepted that the responsibilities of chief pilot include arranging flight crew rosters and allocating appropriate aircraft and that these responsibilities can only be undertaken when the chief pilot has knowledge of who the pilots are, at his base and under his control. However, it does not follow that the chief pilot must therefore be responsible for the transfer of pilots from base to base. In my opinion, the chief pilot's responsibilities apply at a time after the numbers and personnel of pilots at a particular base have been determined. Then, the chief pilot must arrange flight crew rosters and allocate aircraft. However, as I have said, this responsibility does not necessarily involve a responsibility for transfer of pilots. Therefore, I do not accept this submission on behalf of the applicant. Overall, I am satisfied that the notices to transfer issued to Captain Adams were valid notices issued on behalf of his employer. Captain Adams gave evidence that he did not believe the notices to be valid, based on advice that he had received from the AFAP. He said that if he believed that he had received a valid notice of transfer, he would have at least acknowledged it. I accept Captain Adams' evidence as to the genuineness of his claim that no valid transfer notices had been issued. However, for the reasons set out above, I am satisfied that this belief was in error. THE TERMINATION OF EMPLOYMENT - OPERATIONAL REQUIREMENTS? The respondent maintained throughout the hearing that the reason for the termination of Captain Adams' employment was because of the operational requirements of the respondent; in that they required only five pilots at the Jandakot base and not seven. I do not entirely accept this submission. Captain Adams' employment was not terminated because the respondent had two more pilots at Jandakot than it required. Captain Adams' employment would have continued if he had transferred to Meekatharra. It was only because Captain Adams did not transfer to Meekatharra that his employment was terminated. Therefore, in determining whether there was a valid reason for the termination of Captain Adams' employment, the focus must be on whether the failure of Captain Adams to transfer to Meekatharra provided a justifiable reason for termination. In my opinion, it is the determination of this issue on which the resolution of the case will depend. However, the justifiability of the change in pilot numbers at Jandakot and Meekatharra remains part of the relevant background and is a necessary link in the chain of the respondent's case. If the change in pilot numbers is not justifiable, then, in this case, neither is the termination of employment of a pilot for failing to act on a transfer which would in part effect the change. THE FAILURE TO TRANSFER - VALID REASON FOR TERMINATION? The letter to Captain Adams dated 26 June 1996 advised that his date of transfer would commence on 27 July 1996. It is clear that Captain Adams did not transfer on this date. There was no immediate disciplinary action against Captain Adams for this. Indeed, the respondent initiated the conference which took place at the AIRC on 25 July 1996 and 7 August 1996. After that, there was the series of correspondence set out earlier. The final letter the respondent wrote before the termination of Captain Adams' employment concluded that Mr Rathbone inferred from the letter from Mr Cox dated 23 August 1996 that Captain Adams had no intention of accepting a transfer and that it was the AFAP's view that Western Operations should treat the situation as a redundancy. A request was then made for Mr Cox to provide further correspondence. The letter concluded that unless Mr Rathbone received a response that he considered satisfactory, a likely decision would be made to terminate employment. As set out earlier, Mr Cox did reply. However, the respondent clearly did not regard the contents of the reply as satisfactory. This can be inferred from the fact of the termination of Captain Adams' employment and the letter to him dated 5 September 1996. This letter said that Western Operations had no alternative but to terminate employment although it had fully considered the matters raised by the AFAP on behalf of Captain Adams. There was, as Mr Rathbone conceded in his evidence, no direct refusal by Captain Adams to transfer to Meekatharra. However, Mr Rathbone said that this was an appropriate inference in all the circumstances of the case. This is not therefore simply a case where there was a direction given to an employee, the direction was not followed and there was a termination of employment as a result. I canvassed the law on this topic in the cases of Lupoi v Phillips Fox, (unreported) IRCA 485/96, Ritter JR, 3 October 1996 and Van Tran v Callum Textiles, (unreported), IRCA 78/97, Ritter JR, 13 March 1997. Here, it is clear that beyond the date of the time of Captain Adams' directed transfer to Meekatharra, he continued to work at the Jandakot base without sanction. Therefore, to some extent, the respondent acquiesced in Captain Adams' failure to transfer. At the same time, the proceedings before the AIRC were taking place. There is a lack of clear evidence as to what the AIRC proceedings involved. (This is in part because I generally upheld an objection by the respondent to evidence being given about the discussions at AIRC conferences on the basis of privilege.) However, the letter sent by Mr Cox to Mr Rathbone on 29 August 1996 asserted that the AIRC dispute involved a number of issues "impacting directly on the matter" and the question of pilot numbers within the section. In his reply dated 2 September 1996, Mr Rathbone said that the AIRC notification of dispute referred to permanent transfers. If this is so, then the assertion by Mr Cox in the previous letter that the dispute directly had an impact on Captain Adams and Captain Schouten was quite possibly correct. The assertion was made again by Mr Cox in his reply dated 4 September 1996. The respondent did not seek any further clarification of this issue and proceeded to terminate the employment of Captain Adams. The evidence of Mr Rathbone did not elaborate further on this issue. Neither Mr Rathbone nor any other officer of the respondent attempted to have a discussion with Mr Cox or Captain Adams about the assertion that the proceedings before the AIRC had a direct impact upon the transfer of Captain Adams. In my opinion, they should have. This view gains greater force given the context of making a decision to terminate the employment of an employee of some 17 years of good service. In addition, the context of a transfer which the respondent acknowledged by its earlier memoranda could have a major disruptive effect upon an employee, needs to be considered. In the combination of circumstances that existed in September 1996, in my opinion, on fine balance, the decision to terminate Captain Adams' employment was premature. This finding may have been different if the respondent had, after their prevarication on the issue, given a firm directive to Captain Adams to commence his duties at Meekatharra, with which Captain Adams did not comply, and/or there had been further discussion with Mr Cox and Captain Adams about the extent to which the AIRC notice of dispute affected Captain Adams' transfer, or the respondent and Captain Adams had further participated in AIRC proceedings and failed to resolve the dispute. If these steps had been gone through, the respondent may have found no "need" to terminate Captain Adams' employment. As I have said, the decision I have made is on fine balance. In favour of the respondent were the facts that subject to the Award, it has a general entitlement to the permanent transfer of its pilots from base to base (a right also provided for in Captain Adams' initial contract of employment), the fact that the respondent did not hastily move to transfer any pilot in 1996, the arguments contained in the letters sent by Mr Cox were at times a little coy and that it could not be said that the respondent's decision to terminate Captain Adams' employment was a "knee-jerk"reaction to his failure to transfer to Meekatharra. Also, as set out above, the respondent had requested the AFAP set out all of its arguments in full, and on open record. In addition, the evidence given by Mr Rathbone as to the need to increase pilot numbers to provide a 24-hour base at Meekatharra was cogent. However, there was not much evidence on the need to decrease pilot numbers at Jandakot, other than general references to costs. In particular, there was limited evidence on whether a total pool of five pilots could service the Jandakot base. The evidence given by Captain Hallet about pilot rosters and events subsequent to September 1996, including the need to employ Captain Schouten as a casual employee, suggests this may not have been the case. Captain Hallett's evidence was to the effect that to February 1997, the Jandakot base had not been simply manned by the intended pool of five pilots. Due to injury, illness and the leave requirements of the Jandakot pilots, pilots notionally to be stationed at other bases, as well as Captain Schouten, were used at the Jandakot base. As well, some Jandakot pilots were called in from leave to help fill the rosters. Mr Rathbone was inclined to put down these difficulties as being caused by the unexpected injuries and long-term absences of two Jandakot pilots, and "teething difficulties" associated with the employment and training of the two new pilots for Meekatharra. However, I am not entirely convinced of this. This forms part of my view that it was premature to terminate Captain Adams' employment on 5 September 1996. In my opinion as the decision to terminate Captain Adams' employment was premature, there was no valid reason for the termination of his employment under section 170DE(1) of the Act. The respondent has therefore failed to discharge the onus under section 170EDA of the Act. In making this decision, I have taken into account the elaboration of meaning of the expression "valid reason" in this context, by cases such as Nettlefold v Kym Smoker Pty Ltd (1996) 69 IR 370, Thomas v Ralph Lynch, unreported, IRCA 627/96, Wilcox CJ, 20 December 1996, and Lupoi v Phillips Fox. To provide a valid reason for termination, a reason must be objectively justifiable. In the context of suggested misconduct, an employer needs to prove that the conduct of an employee was sufficiently serious to justify the sanction of termination of employment. In all the circumstances, on fine balance as I have said, Captain Adams' conduct did not, as things stood on 5 September 1996, justify his termination. REMEDY As stated earlier, the applicant sought the remedy of reinstatement. The Court may order reinstatement under section 170EE(1) of the Act if it considers it appropriate in all the circumstances of the case. The respondent opposed reinstatement. The respondent submitted that the reinstatement of Captain Adams' employment was impracticable and that therefore the appropriate remedy to consider was one of compensation; see section 170EE(2) of the Act. In making this submission, the respondent referred to an aspect of Captain Adams' conduct during his employment and also the conduct of Captain Adams in making certain communications both during and after his termination. THE MERCY FLIGHT ISSUE Ordinarily, the pilots of The Royal Flying Doctor Service perform their duties within set times and prescribed hours of duty. However, on occasion, a situation will arise where a pilot can agree to take part in a "mercy flight' even though to take part in the flight would involve the pilot working beyond his duty times or flying hours. During the hearing, an issue arose as to whether Captain Adams had refused to work on a "mercy flight" on 25 August 1996 involving the transfer of a baby from Albany to Perth. The issue arose because of a facsimile that Captain Adams sent to Mr Cox on 5 September 1996. Attached to a facsimile cover sheet was a copy of an article from the Albany Advertiser on 3 September 1996. The article concerned the failure by the respondent to be able to transfer the baby on the date in question. On the facsimile cover sheet, which was dated 5 September 1996, Captain Adams had written "Timely - you may recall I refused to 'mercy flight' this one". This brought up the issue of whether Captain Adams had refused to perform a mercy flight on this occasion and if so, the appropriateness of this conduct in the context of Captain Adams' seeking of a reinstatement order. With respect to the latter, Mr Rathbone said that if a pilot had no good reason not to undertake a flight when life was at risk, it would be clear that the pilot was not in possession of or practicing the community ethos of The Royal Flying Doctor Service . However, despite the unfortunate use of words in the facsimile cover sheet by Captain Adams, the evidence did not demonstrate a refusal by Captain Adams to undertake this flight. On 25 August 1996, Captain Adams flew from Perth to collect a patient from Paraburdoo and then returned in the afternoon. The daily log sheets of the radio control station of the respondent at Jandakot indicated that there were some communications with Captain Adams that day about whether he could fly to Albany. However, the log sheets do not record any refusal by Captain Adams to undertake this flight. Further, the respondent did not call as a witness anybody who communicated with Captain Adams that day and could attest to any refusal by Captain Adams to accept the flight. The daily log sheet recorded at 1945 hours a communication with Captain Adams where he advised that he could possibly do the Albany trip on a "mercy flight" basis. At 1950 hours there was a notation of the baby's condition being stable but "could crash". The log shows that after 2045 hours, other options than the mercy flight were considered. However, by 2212 hours, the respondent advised Albany by radio that there was no flight available to transfer the baby that evening. It was decided that another pilot, on roster at 0900 hours the following day, would transfer the patient. Nowhere in these records does it indicate that any one went back to Captain Adams to see whether he could do the flight, after the indication that he could have done it on a "mercy flight" basis. In his evidence, Captain Adams said that he was advised of the possible Albany flight after he returned from Paraburdoo. He said that he advised that he could possibly do the flight on a "mercy flight" basis. He said that it would involve a "mercy flight" for him as to do the flight, involving flight time and delays until medical personnel were available, would involve him working longer than his maximum hours of duty for the day. Captain Adams said that therefore other avenues were considered by the duty coordinator. For example, there was mention made of the use of a Kalgoorlie-based crew. Captain Adams said that he advised the coordinator that if the Kalgoorlie crew was available, it would not be proper for him to do a "mercy flight". Captain Adams indicated in his evidence that when he signed off at 2055, the Kalgoorlie option was being explored. Captain Adams said that he did not refuse to do the flight; he was not required nor asked to do it. He said that he had never refused to perform any flight that was lawful for him to do, when working for The Royal Flying Doctor Service . In this context, Captain Adams could not adequately explain why he used the word "refused" in the facsimile cover sheet to Mr Cox. However, it must be acknowledged that the facsimile cover sheet was written at a time when Captain Adams' career with the respondent was clearly at the crossroads. The stress of this situation may provide some explanation for Captain Adams' very poor (and indeed inaccurate) choice of words. With reference to the word "timely", Captain Adams explained that he used this word in the context of his concerns about Jandakot crew numbers, and the argument that resources were too thin to provide a proper service. Captain Adams said that he did not make any public comment on the issue and provided no information to the Albany Advertiser. It was not suggested otherwise by the respondent. Given the totality of the evidence on this issue, I am not satisfied that Captain Adams' conduct in relation to the non-transfer of the patient on 25 August 1996 and its subsequent reporting in the Albany Advertiser, provide any basis for Captain Adams not being reinstated. THE COMMUNICATIONS OF CAPTAIN ADAMS The respondent submitted that communications by Captain Adams with politicians and others, both during and after the termination of his employment, about various personnel within the respondent, was such that reinstatement should not be ordered. Evidence was given of a meeting of Jandakot pilots after the dismissal of Captains Adams and Schouten. At the meeting, Captain Schouten brought up the issue of communication with politicians about the failings of the respondent in the opinion of its employees. This was agreed to by the meeting. Subsequently, Captain Adams was heavily involved in communications with politicians. A number of written examples of such communications were tendered in evidence. One of these was a facsimile from Captain Adams to Mr Mike Board, a State parliamentarian, dated 23 September 1996. Attached to this document was an eight-page memorandum entitled "Concerns for the RFDS in WA". Captain Adams said that this document was compiled partly from his own knowledge and partly from information provided to him. In the document, Mr Rathbone was criticised. The document accused Mr Rathbone of resorting to misinformation in the public debate about the operations of the respondent. Criticisms of the closure of Carnarvon base were included. This part of the document presents as a well-reasoned argument. There is also criticism of a selection of Western Operations senior staff. The document said: "The aviation and communications manager comes from a bureaucratic background and has made little attempt to understand the complexities of the operation or to seek comment from the wealth of experience that surrounds him. The director of nursing is of a similar vein and has caused considerable angst among the nursing staff by her lack of understanding of their work situation. The human resources manager demonstrates little knowledge of the various Awards and working situations that exist throughout the three sections, and lacking in ability to deal with a very experienced and long-serving group of professional people. The replacement engineer manager (now termed "chief engineer") has no general aviation background and no Australian qualifications or licences". The allegations made in this part of the document were denied by Mr Rathbone in his evidence. It was acknowledged by Captain Adams that this document was sent to a number of politicians. They included Mr Graham Campbell and Ms Megan Anwyl, respectively the Federal and State Members of Parliament for Kalgoorlie. Also tendered was a facsimile from Captain Adams to Mr Leahy dated 27 November 1996. The facsimile attached memorandums which allegedly showed "our concern over Rathbone's management extends to safety." The facsimile cover sheet alleged that the chief pilot at Meekatharra was being forced to cut corners in his haste to try and meet the stated guarantees of 24-hour cover at Meekatharra. The facsimile also alleged that Mr Rathbone had installed a check captain who will not fail pilots who are willing to ingratiate themselves to management and will set up and fail those pilots who stand up to be counted. The facsimile said that Captain Adams viewed with dismay what Mr Rathbone had done to a proud service with the best flying standards achievable. The facsimile concluded "It is a disgrace". Attached to this facsimile was a facsimile from Captain Adams to three colleagues at the AFAP. This was also dated 27 November 1996. The memorandum referred to the cessation of a Captain Brady being involved in the checking and training function and Captain Bleus being given this position. The memorandum alleged that Captain Bleus was not a fit and proper person for the check and training role. The memorandum alleged that Captain Bleus had low flying standards, a lack of airmanship and a lack of integrity and pliability. The respondent also referred to written communications made by Captain Adams made to Mr Cox. The first of these was a facsimile to Mr Cox dated 12 June 1996. This attached minutes of a meeting of pilots and flight nurse specialists held on 17 May 1996. This was not a meeting that Captain Adams had attended. Under the heading of "Potential Problems" was a reference to an observation by Captain Bleus about four-pilot rosters. This prompted the comment in the facsimile cover sheet from Captain Adams to Mr Cox that it appeared that Captain Tippett and Mr Lansell had lied to them about the five-pilot roster. In evidence, Captain Adams explained that he no longer held this view. He said that the assertion in the facsimile was based on an apparently different understanding of the meaning of a five-pilot roster between himself and Captain Tippett and Mr Lansell. Another exhibit was a facsimile from Captain Adams to Mr Cox dated 16 August 1996. This was a one-page facsimile advising of certain information from a pilot meeting of that day. The facsimile covered the issues of pilot rosters, checking and training and a dispute involving a Captain Brady. The facsimile concluded, "The Rathbone/Lansell/Tippett mafia appear to have no morals, scruple (sic) or ethics whatsoever". Finally, there was a one-page facsimile from Captain Adams to Mr Cox dated 21 September 1996. The facsimile was headed "Debacle for Today". It recited a difficulty that had arisen that day concerning an evacuation required from Carnarvon. The facsimile concluded with a concern mentioned by Mr Leahy that the Minister of Health, Mr Prince, had been talking about the withdrawal of funds from The Royal Flying Doctor Service and seeking other funding providers. The facsimile then said "which is I believe Rathbone's brief". In evidence, Captain Adams said, in effect, that he still considered it a possibility that part of Mr Rathbone's brief was the conversion of The Royal Flying Doctor Service from a publicly to privately-funded concern. He said that although he did not positively believe this to be the case, in essence, he could not dismiss such scenario from being a possibility. Mr Rathbone was asked about each of these communications from Captain Adams. Mr Rathbone said that Captain Adams seemed to be of the opinion that only his views were correct and that he did not respect other people's points of view. He said that the communications seemed to indicate an intention not to support the needs of the operation as discerned by management. Given the communications, he thought that it would not be tenable for himself or other managers of the respondent to work with Captain Adams. Individual managers and the service as a whole had been denigrated by the communications of Captain Adams, in the opinion of Mr Rathbone. In his evidence, Captain Adams was somewhat embarrassed at the public airing of some of the comments he had made. He also said that he did not bear a grudge against any individual that he had mentioned in the correspondence and that he would be quite prepared to work with such people again. In my opinion, these answers of Captain Adams were genuine. It is within this factual situation that I need to determine whether in all the circumstances, reinstatement is appropriate and not impracticable. Before turning to this issue generally, the respondent also referred to the "fact" that if Captain Adams is reinstated, then the likely result is the forced redundancy of another pilot. This was because all full-time pilot positions were now occupied. I do not accept that this makes reinstatement of employment impracticable. As Northrop J said in Johns v Gunns Limited (1995) 60 IR 258 at 271, "the mere fact that a position vacated as a result of the termination of an employee has been filled by the engagement of a new employee cannot make the reinstatement impracticable. A contrary conclusion would make the primary remedy ineffective. An employer could re-fill the position immediately, thereby depriving the terminated employee the remedy of reinstatement". This judgment was referred to approvingly by Marshall J in Abbott-Etherington v Houghton Motors (1995) 63 IR 394 at 398. On the issue of reinstatement generally, I take into account the meaning of the term "impracticable" as discussed in Perkins v Grace Worldwide (Aust) Pty Ltd, unreported, IRCA 15/97, Full Court, 7 February 1997. "Impracticable" means more than inconvenient or difficult. If 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; Wilcox CJ in Nicholson v Heaven and Earth Gallery Pty Ltd (1994) 1 IRCR 199 at 210, as cited at page 9 of Perkins. However, the fact that some harmony is affected by the return to work of an employee whose employment has been terminated is unexceptionable. This is merely an example of the return to work being inconvenient or difficult; Marshall J in Abbott-Etherington at page 396 - 397, as referred to in Perkins at page 10. Whether there has been a loss of trust and confidence by an employer in an employee is a relevant consideration in determining whether reinstatement is impracticable, providing such loss of trust and confidence is soundly and rationally based; Perkins page 11. However, "in most cases, the employment relationship is capable of withstanding some friction and doubts . . . what is important in the employment relationship is that there be sufficient trust to make the relationship viable and productive". (Perkins, page 12) I do not think that the communications from Captain Adams to Mr Cox have the effect that reinstatement of employment is inappropriate or impracticable. These communications were written at an emotionally-charged time. They were communications made to an industrial officer that would ordinarily remain private. They were not communications made to management, such as could constitute insubordination, nor were they public communications. The communications made by Captain Adams to politicians raise more serious concerns in my mind as to the appropriateness and practicability of a reinstatement order. In these communications, which could have become public, Captain Adams directly and seriously criticises a number of members of management of the respondent. Again, however, I take into account the fact that the communications were made at an emotionally-charged time and about issues that Captain Adams felt dearly about. I also take into account that the Act implicitly recognises that employees may legitimately hold views different from those of their employer. For example, the Act makes it unlawful to terminate employment on the grounds of union membership, participation in union activities, non-membership of a union, or the filing of a complaint against an employer involving violation of laws or regulations; see Section 170DF(1)(b), (c) and (e). In the end, the assessment of whether reinstatement is appropriate or impracticable involves a matter of judgment, taking into account all the circumstances of the case relating to both employer and employee; Wilcox CJ in Nicholson at page 210 as cited in Perkins at page 9. In my judgment, reinstatement is appropriate and is not impracticable in this case. I take into account that no witnesses were called on behalf of the respondent to support the view that any gross disharmony would be caused by the reinstatement of Captain Adams, apart from Mr Rathbone. To some extent, Mr Rathbone will, because of his position, be removed from these issues on a day-to-day basis. In addition, as I set out above, I accept as genuine Captain Adams' statement that he thought that he could work with all employees of the respondent. I also thought that Captain Adams was somewhat remorseful about the extent of claims that he had made in some of his communications and is therefore likely to be more careful in the future. I also thought that Mr Rathbone presented as a calm, rational and reasonable person. In my opinion, such a person ought to have the capacity to work with Captain Adams, to the extent necessary. Therefore an order will be made under section 170EE(2) for the reinstatement of Captain Adams as a pilot at the Jandakot base. I will also make an order so as to maintain the continuity of the employment of Captain Adams by the respondent. The applicant also sought an order requiring the respondent to pay to the applicant the remuneration lost by him because of the termination. The applicant sought the total loss of wages from the expiry of the termination payment to reinstatement. Captain Adams said that he had not been employed since his termination by the respondent. He indicated that he had looked for but had been unable to find employment in his field as a commercial pilot. It was not suggested by the respondent that Captain Adams had failed to discharge any duty to mitigate his loss. In all the circumstances, I will exceed to the applicant's submission. The applicant's salary at the time of his dismissal was $46,260 per annum gross. He was paid the amount of five weeks' salary in lieu of notice. Five weeks from 5 September 1996 is 10 October 1996. Captain Adams' salary equates to a weekly payment of $889.62 gross. I will order that Captain Adams be paid compensation at the rate of $889.62 less PAYE contributions (see Klingenberg and TWU v IR Cootes Pty Ltd (1995) 63 IR 366) from 10 October 1996 until the date when reinstatement takes effect. The parties will need to ascertain and agree to the appropriate net amount per week after consultation with the Australian Taxation Office if necessary. The respondent will need to remit the taxation extracted to the Australian Taxation Office. If the period between 10 October 1996 and the date when the reinstatement order takes effect involves any incomplete week, the applicant should be paid the appropriate pro rata amount. If the amount to be paid to Captain Adams cannot be agreed upon, the parties may seek liberty to apply as to the terms of the order. I will make an order that the amount to be paid to the applicant be so paid within fourteen (14) days. ORDERS 1. The termination of the employment of the applicant by the respondent contravened section 170DE(1) of the Workplace Relations Act 1996. 2. The respondent shall, within seven (7) days, reinstate the applicant by appointing him to the position of pilot at the Jandakot base of the respondent on terms and conditions no less favourable than those on which the applicant was employed immediately before the termination of his employment. 3. The employment of the applicant is deemed to have continued for all purposes from 5 September 1996 to the date of reinstatement in accordance with this order. 4. Within fourteen (14) days of the date of this order, the respondent pay to the applicant his loss of remuneration at the rate of $889.62 per week, less PAYE taxation at the appropriate rate, from 10 October 1996 to the date of reinstatement. 5. There be liberty to apply as to the terms of this order on not less than forty-eight (48) hours' notice to the other party. I certify that this and the preceding forty-one (41) pages are a true copy of the reasons for decision of Judicial Registrar Ritter. Associate: Date: 4 July 1997 APPEARANCES Representative for the Applicant: Mr L Cox of the Australian Federation of Air Pilots Counsel for the Respondent: Mr C Raymond Solicitor for the Respondent: Blake Dawson Waldron Date of hearing: 25, 26 and 27 March 1997 Date of judgment: 4 July 1997