McClean v Northwest Radio Pty Ltd [1998] IRCA 32

INDUSTRIAL RELATIONS COURT OF AUSTRALIA INDUSTRIAL LAW – alleged UNLAWFUL TERMINATION – whether VALID REASON – whether employee given opportunity to defend himself

Industrial Relations Act 1988 (now Workplace Relations Act 1996) ss 170EA, 170DE(1), 170DE(2), 170DC.

andrew laurence McCLEAN -v- northwest radio pty ltd

Wi 1737 OF 1995 R.D. FARRELL JR 1 October 1998 PERTH (Heard in karratha)

IN THE INDUSTRIAL RELATIONS COURT OF AUSTRALIA

WESTERN AUSTRALIA DISTRICT REGISTRY WI 1737 of 1995

BETWEEN: Andrew Laurence McClean

Applicant

AND: Northwest Radio Pty Ltd

Respondent

court: R.D. FARRELL JR

DATE OF ORDER: 29 August 1996

WHERE MADE: PERTH (Heard in karratha)

THE COURT ORDERS THAT: 1. The application is dismissed. 2. The time prescribed by Order 75 Rule 3 for any application for review of this order shall run from the date on which reasons for decision are issued. 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 1737 of 1995

BETWEEN: Andrew Laurence McClean

Applicant

AND: Northwest Radio Pty Ltd

Respondent

court: R.D. FARRELL JR

DATE: 1 October 1998

PLACE: PERTH (Heard in karratha)

REASONS FOR DECISION This was an application under Section 170EA of the Industrial Relations Act 1988 (now the Workplace Relations Act 1996) for compensation arising from the alleged unlawful termination of the employment of the applicant, Andrew Laurence McClean ("Mr McClean"), by the respondent, North West Radio Pty Ltd ("Northwest Radio"). Reinstatement was not sought, and it was readily apparent that from the behaviour of the parties during the hearing that reinstatement was impracticable. Orders were made some time ago dismissing the application. Brief reasons for those orders follow. Mr McClean was employed by Northwest Radio as a radio announcer in January 1995. Mr McClean was hired to perform the "breakfast shift" at station 6KA in Karratha. He was thirty five years of age, and had had substantial prior experience in radio before work in the resources industry brought him to the Pilbara. Northwest Radio is a regional commercial radio company, running stations in Karratha and in Port Hedland. Its manager, Mr Andrew Lenton ("Mr Lenton") had not long taken over. Northwest Radio's owner, Mr Terance Leo, believed in giving young, untried and, no doubt, relatively inexpensive talent an opportunity at his station. Accordingly, many of the other announcers recently hired with Mr McClean had little practical experience in the radio industry. Mr McClean, with his experience in radio, was therefore of great assistance to them and came to wield considerable influence over the on air activities of the station. I am satisfied that Mr Lenton was initially happy with Mr McClean's performance. There was evidence, however, that soon after Mr McClean commenced his employment, he began to manifest behaviour which eventually led Mr Lenton to put disciplinary processes in train. The radio announcer's role included the playing of music from a music log, the playing of pre-recorded ads and the reading of live ads in accordance with an advertising log. There were also occasional live telephone discussions with advertising clients, in the course of which the clients would commend their wares to the listening audience. On one such occasion during the breakfast shift, Mr McClean rang a sales representative of an electrical store in Karratha to enable him to advertise a special deal on mobile telephones. Prior to the telephone link up, the sales representative had faxed minimal details of the offer to be advertised. The facsimile is dated 20 February 1995, indicating that the incident took place on or soon after that date. Mr McClean described the ensuring "live cross" as a "debacle". It seems clear that after conveying the basic details of the mobile telephone offer, the sales representative had nothing else prepared to say. Consequently, there were awkward pauses and the advertisement was embarrassing for all concerned. The facsimile was tendered in evidence, and Mr McClean identified his annotation across the top of the fax. The annotation describes the sales representative with a generic expletive, and notes that the sales representative "was not ready" and "had nothing to say about the phone". At the end of his shift that day, Mr McClean felt he "couldn't let it go by". He contacted the electrical store with the intention of speaking to the manager. The sales representative answered the telephone, and would not put Mr McClean through to the manager, wanting instead to talk about the incident himself. Mr McClean agrees he told the sales representative he had let down his company, and had "dropped the ball". Mr McClean concedes he was "fairly firm", and that the conversation became fairly heated, so that they were both shouting by the end of the call. He said that the call concluded on the basis that they should put this problem behind them. Mr McClean recalls Mrs Karen Lenton, who was the station's "traffic coordinator", coming into the room. Mr McClean claims that Mrs Lenton told him "good on you", or words to that effect, and that as she left the room she told one of the other employees "someone's got to stand up to these idiots". Mrs Lenton denies this. Mr McClean claims he raised this telephone conversation with Mr Lenton. He says Mr Lenton was not all perturbed. He says Mr Lenton said he wasn't too worried, noting that, given the size of the advertiser, they were more trouble to the station than they were worth. Both Mr and Mrs Lenton contest Mr McClean's evidence on this matter. It was Mr Lenton's contention that Mr McClean, in his capacity as an announcer, should not have been calling clients to upbraid them for the perceived inadequacies of their sales representative's performance. This was, Mr Lenton contended, the function of management. He also contended that, as a direct result of Mr McClean's actions on this occasion, the electrical store withdraw their advertising from Northwest Radio. It seems, however, that nothing was said to Mr McClean at the time as to the inappropriateness of his actions. These were bitterly contested proceedings and I have no doubt that the applicant and Mr Lenton of the respondent were both prepared to go to great lengths to ensure success in this case. For this reason, and for other reasons to which I will refer in due course, I was hesitant to rely on the evidence of either of them where it was not corroborated by other evidence. I had fewer reservations about the evidence of Mrs Lenton. Her evidence was given in a thoughtful, measured manner and I found her evidence convincing. Mrs Lenton denied making the comments attributed to her, and indeed denied going into the room during the telephone conversation. Another witness, Mrs Coral Howe (nee Maher), recalls hearing Mr McClean "yelling and swearing" at a customer on the telephone who she recalled as being the sales representative from the electrical store. She also recalls the staff feeling surprised that Mr McClean would conduct himself in this manner to a customer. A number of the respondents' witnesses commented that, to the extent that the live cross was unsatisfactory, some of the responsibility was Mr McClean's, as it was part of his role to assist clients who might be ill-prepared. Mr McClean also concedes that on another occasion he abused a listener who telephoned him during his shift. I regard this as a less significant incident. Again, there does not appear to have been a clear response from Mr Lenton indicating unequivocally that this behaviour would not be accepted in future. In about April 1995, Mrs Howe, who was one of Northwest Radio's sales executives, succeeded in interesting Robe River Iron Associates, ("Robe River") a mining venture with a significant presence in the area, in the idea of sponsoring the station's news program. When Mr McClean was advised of this proposition, he was strongly opposed to it. He explained in evidence that he did not believe it was advisable to have the news sponsored because the sponsorship of the news could effect its credibility. He also held the view that Robe River's public image was fairly low at the time. Mrs Howe's evidence was that Mr McClean's reaction was that it couldn't be done and that it wasn't good radio. She says he started swearing, yelling and throwing things down. She says he was abusive, and stated that he wasn't doing it on his shift. It seems that Mrs Howe found this a traumatic experience. She gave evidence that she walked out of this discussion and quit her job. She says she was reduced to tears. Mrs Howe was eventually talked out of leaving by Mr Lenton, and she says Mr McClean later rang and apologised. It was apparent on all the evidence that Mr McClean demonstrated himself during his employment to be a difficult character, with a volatile temperament. It was also amply demonstrated at times in the manner in which he gave his evidence. It might fairly be said that some indulgence was extended to Mr McClean on this score by the station's management that would not necessary be expected by ordinary employees. Perhaps it was considered appropriate to accept a degree of "artistic temperament" in the station's on-air announcers. While this behaviour did not lead to formal warnings or ultimatums at the time, it does not follow that the behaviour was endorsed, nor that Mr McClean believed they were regarded as acceptable. The fact that he usually felt the need to pre-emptively raise these incidents with Mr Lenton shows that he recognised they were matters about which he should apologise, as indeed they were. When the employer was later considering whether Mr McClean's employment should continue, it was not inappropriate that they take into account this aspect of his past behaviour. Mrs Howe decided to go back to Robe River and recast the arrangements so that instead of sponsoring the news, they would instead sponsor the weather and sports results. A contract for sponsorship of sports results was concluded on 21 April 1995. There was evidence that an agreement for sponsorship of the weather, linked with the broadcasting of a "Robe Facts" segment, was concluded at about the same time. However, the need for Robe River to provide the facts and Northwest Radio to prerecord those segments meant that the sponsored sports results began going to air some time before the sponsorship of the weather. Mr Lenton tendered a memorandum from him to Mr McClean bearing the date 26 April 1995. It was his evidence that he caused this memorandum to be typed and given to Mr McClean on or soon after that date. The memorandum was in the following terms: "So we have no misunderstanding with regard to Robe River Iron Associates contracts. 1. You have voiced an opinion and sought backing from other staff members to the effect that sponsoring News or Weather compromises the station and is "Bad Radio". 2. You have also said that we should not be associated with Robe River because a mate of yours works for them and they are bad employers. I feel your arguments have no validity and we will go ahead with the segments in accordance with our contract. Your attack on Coral Maher for writing the contract was disgraceful and will not be tolerated. Whether we deal with Robe River or not is none of your concern." This was the first of a series of four memoranda that Mr Lenton tendered on behalf of Northwest Radio. Three originated from him and one from the traffic coordinator, Mrs Lenton. Mr McClean in his evidence denied ever having seen any of these memoranda before the exchange of documents as part of the preparation for these court proceedings. Mr McClean, through his representative, sought to prove that these memoranda had been generated after the fact to provide documentary support for the respondent's contentions. Mr Lenton's secretary Ms Anne O'Hern ("Ms O'Hern"), when shown the memoranda from Mr Lenton, did not recognise them and did not recall having typed them. She said that if she did not type them then they were probably typed by Mrs Lenton. She agreed in re-examination that often when she typed things she did not read them, so one might infer that she would not necessarily have a recollection of having typed a document some ten months after the event. Given the convenient terms in which the memoranda are written, it is perhaps understandable that the applicant's representative was suspicious. He sought and was granted orders allowing inspection of the respondent's word processing equipment for the purposes of establishing the date of creation of the memoranda. Mrs Lenton confirmed in her evidence that the inspection did not succeed in locating any records of the memoranda in the office's word processor. Mrs Lenton explained that this would be because the word processing files were regularly purged, wiping any documents within three or four months of their creation. In the context of the discussion prior to the granting of those orders, Mr Lenton offered not to rely upon the memoranda if that would forestall the need for an inspection. In the end, the inspection went ahead, and so I have assumed that the respondent now seeks to rely upon the memoranda. I find that Mr McClean genuinely has no recollection of having received the memorandum dated 26 April 1995. As for the events canvassed in that memorandum, having assessed the evidence of Mr McClean and Mrs Howe, I am satisfied that, in the course of a conversation with Mrs Howe, Mr McClean vigorously opposed Robe River's sponsorship of the news. I am satisfied that this opposition was based both upon an objection in principle to sponsorship of the news by any commercial entity, but also an objection in particular to Robe River's sponsorship based upon Mr McClean's perception that Robe River had a poor public image. It may be that Mr McClean felt a personal antipathy for Robe River. Mrs Howe was of the opinion that his opposition was motivated more by the fact that the sponsor was Robe River than through any objection in principle to sponsorship. I am satisfied that the vehemence of Mr McClean's objection made it a traumatic experience for Mrs Howe and I accept as a matter of fact that she tendered her resignation as a result. I would have been satisfied of these matters in the absence of the memorandum. Nor do I rely on the other memoranda for my findings on the matters considered below. Mr McClean's initial reaction to the proposed Robe River advertising assumes a greater potential significance because of his later persistent non-compliance with the advertising log in relation to those advertisements. Mr McClean explains this non-compliance as arising from a misunderstanding on his part of what was required of him. In short, he thought the advertising logs were wrong or mistaken, and indeed the logs appear to show persistent efforts on his part to "correct" these perceived mistakes. By the time of the hearing, he accepted that he was wrong in this, but protested that it was never made clear to him what was required of him. Northwest Radio respond by saying that it was made clear to him on numerous occasions what was required of him and that his consistent failure to comply with the log was due to a wilful refusal to play Robe River advertisements. There were two sorts of Robe River advertising contract. The first related to the sports results. An example of that contract was tendered in evidence. It provided for sports results sponsored by Robe River to be put to air at 7.34am and 5.04pm on both Mondays and Tuesdays. The sports results were compiled by an announcer at the Port Hedland station, Mr Nigel Weston. He gave evidence that the Karratha and Port Hedland stations would be networked for the Monday morning sports results, which he would read out in conversation with Mr McClean. He said that he would then fax the sport results that he had read down to the Karratha station. It was his understanding and the station's understanding that those results would then be read out on the Monday and Tuesday afternoon shifts by the announcer doing those shifts (normally, Mr Paul Ferrall) and also on Tuesday mornings by Mr McClean. It is clear that Mr McClean did not read out sports results on Tuesday mornings. It is also clear that it was his view that it was "bad radio" to read out old results that had already been heard the previous day. Numerous advertising logs were tendered for Tuesday's in May, bearing the entry: "LIVE - ROBE RIVER IRON ASSOCIATES - SPORTS RESULTS ...07:34:00..." It is apparent from the annotations on the logs which were tendered that the sports results were not announced by Mr McClean, with reasons being annotated on the logs. For example, the log for 2 May 1995 bears the annotation "no - Mondays only". Similarly the log for 9 May 1995 is annotated "no - these occur on Mondays" and on the log for 16 May 1995 is annotated "n/a". Paul Ferrall, another announcer, gave evidence that he also did not read these sports results in the afternoon shifts. He claimed he was never shown were the sports results file was. The other type of advertising contract concerned the Robe River "fact sheets" to be played or reads in conjunction with the weather. I have dealt with the early failures to play the recorded fact sheets. It was also alleged that Mr McClean subsequently consistently refused to perform "live reads" when new Robe fact sheets were introduced. Mr McClean contends that no fact sheet was available to be read during that period. On balance, I accept his evidence in that regard. Another point of contention was Mr McClean's occasional departure from the programmed music lists. He agrees that, as the morning announcer, he sometimes indulged himself and his earlier rising listeners with personal favourites, the most memorable and recurrent of which was apparently a novelty track entitled the "Rubber Biscuit Song". This came to Mr Lenton's attention, and I am satisfied, despite Mr McClean's denials, that this was a matter that was raised with him by Mr Lenton on a number of occasions, albeit perhaps less formally than Mr Lenton suggests. Mr McClean persisted in this practice. Apart from complaints from listeners less enamoured with the "Rubber Biscuit Song" than Mr McClean, his practice of not following the music list had some relatively serious implications for the station's management, given that royalties to be paid by the station were calculated on the basis of the pre-programmed list. Thus the spontaneity and autonomy which Mr McClean was exercising could potentially result in real problems for the station. Still more obviously, his failure to play programmed advertisements created difficulties with the billing of those advertisements to clients. Matters came to a head on 15 June 1995, when Mr Lenton confronted Mr McClean about his failure to provide the Robe Facts segment that day. The discussion became heated and degenerated into a shoving match, at the conclusion of which Mr Lenton advised Mr McClean that he was to be suspended. Mr McClean was suspended on full pay. In my view, neither participant's behaviour in the events of that day was exemplary. Mr Lenton contributed to the level of agitation and it is appropriate that the employer does not rely upon this incident as a ground for Mr McClean's dismissal. Suspension was a reasonable option in the circumstances, as Mr McClean was not financially disadvantaged, and it might potentially have been a "circuit breaker, giving both parties the opportunity to reassess the situation and reach a basis upon which the employment relationship might be rebuilt. Mr Lenton documented his position in the following letter dated 19 June 1996: "Dear Mr McClean SEVERE DISCIPLINARY WRITTEN WARNING FOR MISCONDUCT. On Thursday 15th it came to my attention you had omitted to play Robe River Facts. This is after I specifically told you to do so several times during the week. When I approached you to hear your explanation you said they were not on the logs, I informed you this was not the case and that the Robe River facts were indeed listed on the logs. Further to this it has been bought to my attention that on a number of occasions you failed to play properly logged ads during your shift. In addition to this, without my permission you have substituted music specified on the logs with music of your own choice resulting in complaints from listeners. The matter of your personal conduct both to myself and other staff members has reached such an intolerable level that your behaviour is affecting the morale of staff employed at the radio station. Your behaviour has caused me to lose confidence in both your personal integrity and your ability to perform your contracted work duties. Accordingly you are hereby formally and severely warned that any further occurrence whereby you again breach your contract of employment with North West radio will result in the Company taking whatever action it deems necessary in accordance with that contract of employment, including if warranted the termination of your contract of employment. A copy of this warning will be placed on your Company personnel file. Yours sincerely A J Lenton General Manager" In my view, this letter represents a genuine and legitimate attempt by Mr Lenton as station manager to reassert the station's control over Mr McClean's activities as an employee. Mr Lenton also prepared another warning letter of the same date about the abusive call to the listener that I have referred to earlier. At most it represented a retrospective reassessment of the seriousness of the incident, and a warning that such behaviour would not be tolerated in future, even if it had been acquiesced to in the past. It is irrelevant to these proceedings because no further incidents of that kind occurred. Mr Lenton then arranged a meeting with Mr McClean on 20 June 1996. I accept the accuracy of the evidence of Ms Anne O'Hern, Mr Lenton's secretary, who attended the meeting, and of the minutes of the meeting prepared by Ms O'Hern. The only attendees to the meeting were Mr McClean, Mr Lenton and Ms O'Hern. Mr Lenton gave Mr McClean the letters. Mr McClean reacted angrily. He told Mr Lenton to "shut up" and refused to discuss the letters. He called Mr Lenton a "buffoon". He refused to accept the letters. Ms O'Hern says he threw them in Mr Lenton's face. There were the usual arguments in evidence as to the exact trajectory of the letters, but I was satisfied that there was some extravagance in Mr McClean's persistent refusal to accept the letters. Mr Lenton terminated the meeting and told Mr McClean they would meet again when Mr McClean could control himself. He suggested Mr McClean get advice from his union. Following that meeting, Mr Lenton became aware that Mr McClean may have recently organised the production of a jingle for one of the station's clients in his own time, with the jingle's producer being paid directly. The production of jingles was part of the business of the station. It transpires that Mr McClean also used the station's stationery for that purpose, whether for convenience or not, and that Mr McClean was involved in arranging the prompt payment of the producers account. It seems that the client may have been under the misapprehension that he was dealing with the station. While Mr Lenton and the station owner, Mr Leo, had become aware that Mr McClean may have been involved in this questionable transaction, they had not had an opportunity to properly investigate it. It was, however, a matter that they legitimately wished to raise with Mr McClean. The only attendees to the next meeting, on 22 June 1996 were again Mr McClean, Mr Lenton and Ms O'Hern. Mr McClean was late, and then the meeting was taken up in unresolved argument about the attendance of a witness or representative on behalf of Mr McClean. Mr Lenton was prepared to have a union representative or member present, but not merely a fellow staff member, as he viewed the employment relationship as confidential. The next day, the final meeting took place. Mr McClean acknowledged that he had read the letters. In response, he read a statutory declaration he had prepared on 20 June. The declaration: · dealt with the altercation on 15 June 1996; · dealt with his disputes with Mrs Lenton as to the adequacy of the station logs; · raised the fact that he had no written contract of employment; · offered explanations for his failure to play the Robe facts relating to production problems; · offered a favourable assessment of his overall contribution to the station; and · characterised Mr Lenton's managerial approach as "almost fascist", offering other criticisms of Mr Lenton's behaviour. Mr Lenton then asked Mr McClean about the production of the jingle. After initially answering some of the questions, Mr McClean refused to answer further questions. Mr Lenton, being of the view that things had reached an impasse, decided to terminate Mr McClean's employment and read from the following letter, which had been prepared in advance. "Dear Mr McClean FINAL DISCIPLINARY WRITTEN WARNING - UNSATISFACTORY CONDUCT. On June 20th, 1995 in North West Radio's managers office you: 1) Insulted both the General Manager and Managing Director of North West Radio P/L. 2) Repeatedly threw papers in the General Managers face. 3) Refused to obey a lawful and proper instruction from the General Manager. In addition: Your continued frustration of our attempts to negotiate a solution and your continual failure to explain your behaviour on three separate opportunities. Finally it has come to my attention that you have been guilty of serious misconduct through betrayal of trust which has breached your contract of employment and left us no alternative other than to terminate your services forthwith. You will be paid one weeks wages in lieu of notice, plus any accrued holiday pay and this will be directed to your bank account on Friday the 23rd June 1995. Monday 26th June 1995. (hand written) Yours sincerely A J Lenton General Manager" Mr McClean refused to accept the letter and left the meeting without further comment. Section 170EDA(1)(a) confers the onus on the employer to prove that there was a valid reason connected with the employee's capacity or conduct or based on the operational requirements of the undertaking, establishment or service, as is required by Section 170DE(1). At the time the orders were made, I had also taken into account the question of whether, having regard to Section 170DE(2), the termination was harsh, unjust or unreasonable. I was satisfied that there was a valid reason for the termination of Mr McClean's employment connected with his conduct. Up to the point of the meeting on 20 June 1996, the position was arguably equivocal. While some aspects of Mr McClean's conduct was not acceptable, it might reasonably be argued that the standards of behaviour required of him had not been articulated with sufficient clarity. Had the meeting proceeded in a restrained manner, with Mr McClean indicating that he was prepared to conduct himself in future in accordance with Mr Lenton's lawful and reasonable directions, then it would have been difficult for the station to have justified his dismissal. In my view, at that time, the station was not intending to bring about his dismissal. Mr McClean's conduct during that meeting was, however, a reasonable basis for the station to decide to dismiss him. Such a dismissal would not have been harsh unjust or unreasonable. Nor was there a breach of Section 170DC of the Act, which requires that an employee be given an opportunity to defend themselves against allegations in relation to their conduct. It is arguable that, given the nature of the conduct at the meeting on 20 June and the circumstances in which it occurred, there was nothing to discuss, so that it would not be reasonable to expect the station to give Mr McClean that opportunity, for the purposes of Section 170DC(2) of the Act. In any event, Mr McClean was given a further opportunity to defend himself on 23 June 1996. While dismissal was likely prior to that meeting, I accept that Mr Lenton's mind was not closed to other options, had Mr McClean given some indication that their working relationship could be restored and had he addressed Mr Lenton's concerns about the production of the jingle. On this basis, I concluded that the employer was not in breach of the relevant provisions of the Act. A decision of the High Court since my orders were made which invalidates Section 170DE(2) of the Act has lent additional support to this conclusion. Conclusion Accordingly, I will order that this application be dismissed.