BELL - v - KARRAS [1997] IRCA 214

DECISION NO:214/97 C A T C H W O R D S INDUSTRIAL LAW - TERMINATION OF EMPLOYMENT - whether termination at initiative of the employer - PROBATION - whether probationary period determined in advance Workplace Relations Act 1996 ss 170CC Workplace Relations Regulations reg. 30B CFMEU & Hornett v Borg Manufacturing Pty Ltd (unreported, Industrial Relations Court of Australia, Moore J, 6 February 1997) Rheinberger v Huxley Marketing Pty Ltd (1996) 67 IR 154 NEIL STANLEY BELL - v - ARTHUR KARRAS No. VI 1212 of 1997 Before: Judicial Registrar Millane Place: Melbourne (heard in Warrnambool) Date: 12 June 1997 INDUSTRIAL RELATIONS COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY VI 1212 of 1997 B E T W E E N : NEIL STANLEY BELL Applicant A N D ARTHUR KARRAS Respondent MINUTES OF ORDERS Judicial Registrar Millane 12 June 1997 THE COURT ORDERS THAT: 1. The application is dismissed. NOTE: Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules. INDUSTRIAL RELATIONS COURT OF AUSTRALIA VICTORIA DISTRICT REGISTRY VI 1212 of 1997 B E T W E E N : NEIL STANLEY BELL Applicant A N D ARTHUR KARRAS Respondent Before: Judicial Registrar Millane Place: Melbourne (heard in Warrnambool) Date: 12 June 1997 REASONS FOR JUDGMENT In this case the applicant seeks compensation from his former employer alleging that his employment by the respondent as a cleaner from 26 October 1996 was terminated on 27 December 1996 in contravention of the Workplace Relations Act 1996 (the Act). The respondent's initial defence to the claim was to allege that the applicant resigned after being questioned by the respondent about allegations made by a co-worker that the applicant was stealing cleaning chemicals and other cleaning items belonging to the respondent. During the course of the hearing the respondent also raised the issue of whether, at the time of the alleged termination, the applicant was in fact a probationary employee and thereby precluded by section 170CC of the Act and Regulation 30B of the Workplace Relations Regulations from the benefits of the Act. In my view this lastmentioned defence is unsustainable for a number of reasons. The first is that the defence was not relied on when the respondent opened its case. The second is that the evidence from the respondent indicates that any probationary period the respondent relied on was not determined in advance; in the sense that a period of ten weeks probation was the subject of an express or implied agreement prior to the commencement of the contract of employment (see CFMEU & Hornett v Borg Manufacturing Pty Ltd (unreported, Industrial Relations Court of Australia, Moore J, 6 February 1997)). The wages subsidy agreement produced to the Court (Exhibit A1) indicates that a period of probation provided for in that agreement between the employer and the Commonwealth concluded on 16 November 1996. The terms and conditions attached to that agreement require that any amendment to the agreement be in writing. There was no written alteration to that agreement, nor any evidence that an alteration was made in writing at any time. Moreover, the evidence of the respondent himself indicates that that agreement was not signed and any alleged arrangement with the applicant to extend the period of probation was not discussed until 11 November 1996, some weeks after the applicant commenced his employment. The principal issue for determination by the Court is whether there was termination at the initiative of the respondent. The applicant carried the initial burden of proof on this question and gave his evidence first. THE WITNESSES The applicant gave evidence and called the following witnesses: - John Pearson (Pearson), a cleaner employed by the respondent at the relevant time; - David John Laird (Laird), the regional manager in youth affairs with the Department of Education, Employment and Training; and - Alan Goldsworthy (Goldsworthy), the officer-in-charge of employee services with the Commonwealth Employment Service. The respondent gave evidence and called one other witness, Joseph Marinacci (Marinacci), a cleaner employed by the respondent. In October 1996 the applicant had been unemployed for some time. He was then registered with the Commonwealth Employment Service, which organisation arranged for him to be interviewed by the respondent for a position as a part-time cleaner working up to twenty-five hours per week in the respondent's cleaning business. That position was the subject of a wage subsidy agreement between the Commonwealth and the respondent for the period 26 October 1996 to 14 March 1997. The applicant was successful in gaining the position. As I have already indicated above, the work subsidy agreement and the oral evidence support a conclusion that whilst there was discussion of and agreement to some limited period of probation to 16 November 1996, no period of probationary employment for a period beyond the date on which the alleged termination took place was agreed upon prior to the applicant commencing his employment. Other than minor criticisms of his performance from time to time, it was common ground that the applicant's general performance was not the subject of any ongoing complaint. The relevant events preceding the alleged termination occurred from Tuesday, 24 December 1996. On Christmas Eve, due to a heavy workload, the applicant was required to clean a toilet block with the respondent. On that day he had already worked an early shift. He did not normally work at night. Some ten to fifteen minutes after starting work the respondent approached him and suggested to him that he was not cleaning the urinals properly. At the same time the respondent indicated that he would show the applicant how to do it. Despite the applicant's suggestion that this attempt to direct him on his work performance aroused in him only a "little bit of anger", his response indicates that he became unnecessarily angry. He was clearly frustrated by the respondent's attempt to train and direct him in the performance of this duty and said words to the effect that he had had enough and he was "... not putting up with this ..." and left to go home. The applicant denies that he stormed out and paced up and down outside before the respondent told him to calm down and go home. However, in view of his acknowledgment that he could not recall what the respondent said to him on this occasion, I am satisfied that the respondent's version of what occurred on that night is the most plausible and likely one. Having had an opportunity to consider what he did, it was agreed that the applicant rang the respondent and apologised. This apology was accepted. During this call the respondent indicated to the applicant he would see him again on the following Friday. This was because Thursday, 26 December was the applicant's rostered day off. It was said by the applicant that he did not work on Friday, 27 December. In contrast, the respondent claims that the applicant worked on the Friday morning before they met at the applicant's home at about 2.00pm for a coffee and a chat. I note that the claim for payment submitted by the respondent to the CES pursuant to the JobStart scheme includes a claim for the period up to and including 27 December 1996. On balance, I am satisfied that the applicant was rostered for and did work on the morning of 27 December 1996 before meeting with the respondent at a pre-arranged time of approximately 2.00pm at the applicant's home. According to the applicant when they met they had coffee and the respondent discussed the job with him before saying "I am going to have to let you go". Following this statement the applicant alleges that the respondent then said he believed chemicals and urinal blocks had been stolen. In response, the applicant informed the respondent that he had no knowledge of this and was then told by the respondent that he believed that the applicant had taken these goods. This exchange culminated in the applicant telling the respondent he would take the matter to Court. He was then informed by the respondent that he had "friends in high places" and this claim brought the retort from the applicant "so do I". After describing the abovementioned exchange in his evidence-in-chief, the applicant then repeated the allegation that the respondent had told him he had to let him go, adding that this was "... because of what happened on Tuesday". It was not put to the respondent that the events of the preceding Tuesday were the basis for the alleged termination; rather, it was claimed that because he thought the applicant had been stealing cleaning products he sacked the applicant. In view of the apology given and the evidence from both the applicant and the respondent that it had been accepted immediately, I am satisfied that the events on the previous Tuesday were not the catalyst for any termination and, it is unlikely that the discussion on 27 December 1996 had anything to do with the Tuesday events. Initially, the applicant also gave evidence that after meeting with the respondent on the Friday afternoon, he had no further discussion with him. He then corrected this allegation by saying "I think I did ring him", adding that such a call may have been on the weekend. Having recalled a further discussion with the respondent, the applicant also recalled that during that conversation he said "... the way I look at it ... I no longer work for you ..." and he then asked for a reference. He alleges that the respondent's response was to ask for a letter from the applicant confirming that he had resigned. When he was cross-examined the applicant conceded that the respondent rang him on the Friday and asked to meet with him at about 2.00pm on which occasion he raised with the applicant a number of allegations. The first was that the applicant had been using the business vehicle for transporting waste to the tip to carry some of his own household garbage. This was an unauthorised use and it had come to the respondent's attention that day following a conversation with Marinacci, who claimed he had been told this by another employee named Gail. This allegation was conceded by the applicant. The second allegation was that Marinacci and other staff said that the applicant was taking products such as toilet rolls and other cleaning goods. The applicant denied the lastmentioned allegation and agreed that he told the respondent he thought the staff were trying to set him up. He also agreed that he told the respondent he had friends in high places who could fix people up and reiterated his allegation that the respondent had made a similar threat. It is alleged by the respondent that at the meeting with the applicant on 27 December 1996 nothing was concluded because he had only visited the applicant to discuss the allegations made by Marinacci that same day. When he saw Marinacci who was cleaning a toilet block a short distance from the applicant's home, in response to his query concerning the whereabouts of a particular cleaning item Marinacci became upset and told him that if anything was missing he should ask the applicant. At about that time the respondent had noticed that some items were missing and in the previous week the respondent had mentioned this to Marinacci. It was Marinacci's evidence that on 27 December 1996 he was concerned that he and Gail, who had repeated certain allegations to him about the applicant taking goods and using the respondent's vehicle to dispose of his own rubbish, would be blamed. Because of this he repeated her allegation to the respondent as well as telling the respondent that on one occasion when he was cleaning with the applicant he had asked Marinacci if he could take some pink urinal blocks from the back of the car. On this occasion Marinacci had told him he was "nuts". This incident was denied by the applicant. Because of Marinacci's reaction to the respondent's enquiries the respondent claims that his visit to the applicant was to ascertain what was happening and to see what he could do about the problem he perceived he had with his staff if these matters were not resolved. At first, the applicant agreed that during the meeting the respondent said in effect - what will we do about you and the other staff not getting on? leaving this question with the applicant before taking his leave. However, in cross-examination the applicant was not responsive to the suggestion that the respondent's statement meant that the applicant was to think about his relationship with other staff and to let the respondent know what he was going to do about it. The respondent denied any statement to the effect that he had to let the applicant go or any indication to the applicant that his employment was at an end. He claims that the items missing were small and his principal concern was to ensure that the employees worked well together. What occurred next is consistent with the respondent's version of events. That afternoon, after seeing the applicant, he met with Gail and another employee, John, at his home, he said to discuss the problem. During the course of the afternoon Marinacci arrived whilst they were discussing the applicant. When he arrived Marinacci was told by the respondent that he had spoken to Gail and John about the allegations and had met with the applicant concerning the same allegations. Marinacci was present that afternoon when the telephone rang and he heard the respondent ask the caller what he intended to do. He also heard him say that he would give the caller a reference, stating the dates he worked. He then heard the respondent tell the caller to put a letter of resignation in his letter box in the next day or two. The respondent told the Court that he received a telephone call from the applicant during the meeting with the other staff on which occasion he asked the applicant whether he had thought about the matter and further asked him when they might get together. At that point the respondent claims that the applicant told him he did not want to work for him any longer and wanted a reference. The respondent accepted the resignation but told the applicant he could not give him a reference and would only give him a statement of service. The abovementioned conversation is consistent with that which Marinacci says he heard. I am satisfied that he was present during the applicant's telephone call with the respondent on the Friday afternoon. I am further satisfied that the respondent in speaking to the applicant asked him a preliminary question along the lines of what did the applicant then intend to do. This is not only consistent with the evidence given by the respondent and Marinacci but is also compatible with the applicant's claim that during their conversation he made a statement in effect confirming that he believed he no longer worked for the respondent. Exhibit A2 is Goldsworthy's written record of advice he says he received from the respondent on 8 January 1997 concerning the termination of the applicant's employment. Goldsworthy has no independent recollection of that telephone advice which he recorded as follows: "Arthur Karras has advised us that Neil Bell resigned on 27/12/96. Neil would have been terminated due to allegations of theft. Alan Goldsworthy" The effect of the respondent's evidence was that he rang the CES some weeks after the resignation to inform that organisation of the outcome. When the applicant resigned to his mind this amounted to an admission of guilt. He denied that he suggested to Goldsworthy that he would have terminated the applicant's employment because he had not completed his enquiries when the applicant resigned. However, once he resigned the respondent saw this as an acceptance of the allegations made against him. On the evidence it appears that the respondent was still completing his enquiries when the applicant resigned. This is not a case where there was any constructive dismissal in the sense that the applicant had no other option but to resign or be sacked. What appears to have occurred is that the applicant was upset by the allegations made and in the course of the enquiries made by the respondent, indicated that he no longer wanted to work for the respondent. On the evidence I am not satisfied that the applicant has established on the balance of probabilities that there was conduct on the part of the respondent that did or would have the effect of bringing the applicant's employment to an end; thereby leading to a termination at the initiative of the respondent (see Rheinberger v Huxley Marketing Pty Ltd (1996) 67 IR 154). An investigation of allegations of misconduct is not, without more, an action likely to bring employment to an end. Accordingly, the order I propose to make is that the application be dismissed. MINUTES OF ORDERS THE COURT ORDERS THAT: 1. The application is dismissed. NOTE: Settlement and entry of orders is dealt with by Order 36 of the Industrial Relations Court Rules. I certify that this and the preceding nine (9) pages are a true copy of the reasons for judgment of Judicial Registrar Millane. Associate: Dated: 12 June 1997 Solicitors for the Applicant: Fogarty & Bacchetti Counsel for the Applicant: Mr B. Lacy Solicitors for the Respondent: D. Madden & Co Counsel for the Respondent: Mr P. Burchardt Date of hearing: 5 May 1997 Date of judgment: 12 June 1997