Industrial Relations Commission of New South Wales CITATION: Hanson -V- Riverwood Sports Club [2005] NSWIRComm 1033 APPLICANT Janette Shirley Hanson PARTIES: RESPONDENT Riverwood Sports and Recreation Club Ltd FILE NUMBER(S): 5114 of 2004 CORAM: Cambridge C CATCHWORDS: Unfair dismissal - termination of employment - summary dismissal - oral dismissal during heated argument - substantive basis did not displace procedural errors - dismissal held as unreasonable - compensation Ordered. Industrial Relations Act 1996 LEGISLATION CITED: Industrial Relations Regulations 1996 Allied Express Transport P/L v Anderson (1998) 81IR410 Jones v Dunkel (1959) 101 CLR 298. CASES CITED: Kagan v Primus Telecommunications (Aust) Pty Ltd (No.2) [2000] NSWIRComm 185 Laing v The Northcott Society [2002] NSWIRComm 365 Perkins v Grace Worldwide (Aust) Pty Ltd (1997) 72 IR186 HEARING DATES: 02/04/2005 DATE OF JUDGMENT: 03/30/2005 APPLICANT Mr G Gillett, solicitor LEGAL REPRESENTATIVES: RESPONDENT Ms H Carayannis, Registered Clubs Association of New South Wales DECISION: - 1 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES COMMISSIONER CAMBRIDGE 30 March 2005 Matter No IRC 5114 of 2004 Janette Hanson -V- Riverwood Sports Club Application by J Hanson re unfair dismissal pursuant to section 84 of the Industrial Relations Act 1996. DECISION [2005] NSWIRComm 1033 1 On 25 August 2004, Janette Shirley Hanson (the applicant), made a claim for unfair dismissal. The claim was made pursuant to section 84 of the Industrial Relations Act 1996 [NSW], (the Act). The application document named the respondent employer as Riverwood Sports Club. The respondent employer has subsequently been more accurately identified as Riverwood Sports and Recreation Club Ltd (ACN:000 290 406), (the employer). 2 Following unsuccessful attempts at reaching conciliated settlement of the claim, the matter has proceeded to Arbitration involving Hearing on 4 February 2005. BACKGROUND 3 The applicant is a female who was some fifty six years of age at the time of her alleged unfair dismissal on 9 August 2004. The applicant had been employed by the respondent Club as a Barperson and she had worked in that position for approximately three years and eight months. 4 The applicant was dismissed on the afternoon of Monday, 9 August 2004. The applicant's dismissal occurred during a heated verbal altercation with the employer's General Manager, Mr Parsons. Mr Parsons had met the applicant in the bar area of the Club premises and engaged her in debate about various work related conduct matters. An argument ensued and although the details of precisely what was said between the applicant and Mr Parsons was the subject of considerable contest, the argument culminated in the applicant's summary dismissal. 5 After the argument with Mr Parsons, the applicant left the Club premises. The applicant did not attend for work at commencement time for her next rostered engagement and consistent with the verbal advice of dismissal provided during the argument on 9 August, she sought to obtain an Employment Separation Certificate. In due course the applicant was apparently provided with an Employment Separation Certificate, however, the employer did not provide any written confirmation of the dismissal implemented orally during the argument of 9 August. 6 The applicant has asserted that her dismissal was unfair, and has sought monetary compensation as remedy for her complaint. THE EVIDENCE 7 The evidence in this matter focussed upon primary factual contests regarding the details of the argument that occurred between the applicant and Mr Parsons on the afternoon of 9 August 2004. These factual contests involved directly conflicting recollections of the precise words said by both the applicant and Mr Parsons. In particular, a matter of significance involved the point in time during the argument at which Mr Parsons confirmed the applicant's enquiry as to whether or not she was dismissed. The applicant admitted that she used an inappropriate and insulting comment directed at Mr Parsons. This comment involved the suggestion that younger female bar staff "touched up" Mr Parsons, in particular by "grabbing him on the arse". 8 The applicant's evidence was that the "touching up" comment was made after Mr Parsons had confirmed that the applicant was dismissed. Mr Parsons provided evidence that the dismissal occurred because of, and immediately following the "touching up" comment made by the applicant. 9 Although the Commission has been required to settle this important factual contest about the detail of the sequence of events during the argument between the applicant and Mr Parsons, the failure to provide for proper procedure and any subsequent written verification of the dismissal would ordinarily ensure that the claim satisfied the statutory criteria. 10 The applicant was the only witness called to provide evidence in support of her claim. The applicant attested to the veracity of two affidavits that she had sworn for these proceedings. 11 The applicant presented as a strong willed and somewhat blunt character. The applicant acknowledged that at times the language used in the barroom setting of the Club was robust and direct. The applicant did not present as a witness that was endeavouring to provide untruthful evidence. The applicant appeared to genuinely adopt her recollection of the sequence of events involving the argument between herself and Mr Parsons on 9 August 2004. 12 The employer called two witnesses to provide evidence against the claim. The primary and substantial portion of evidentiary material was provided by the employer's General Manager, Mr Garry Parsons. In addition evidence was provided by Ms Florence Lagan, a Director of the employer and also a friend of the applicant. The evidence provided by Ms Lagan has ultimately become central to the determination of the factual conflict about the sequence of events that occurred during the argument between the applicant and Mr Parsons. 13 Mr Parsons presented as a tense and careful witness. Mr Parsons did not display characteristics that would impeach the veracity of his testimony. Mr Parsons, as with the applicant, appeared to genuinely believe that his recollection of the sequence of events during the argument on 9 August was accurate. 14 The evidence provided by Ms Lagan almost unintentionally became vital to the determination of the primary factual contest existing between the recollection of the applicant on the one hand, and Mr Parsons on the other. In particular the testimony provided by Ms Lagan about the applicant's comments that were made to her when the applicant came to her home immediately after the dismissal has become very important. Ms Lagan as both a Director of the Club, and friend of the applicant, may well be considered as an independent witness and she presented her evidence in a manner entirely consistent with a person endeavouring to be truthful and entirely unbiased. Consequently the Commission has had particular regard for certain aspects of the testimony of Ms Lagan. 15 As mentioned earlier, there was uncontested evidence about the failure of the employer to implement some proper procedure after the argument that included advice of the applicant's dismissal. The evidence of absence of any subsequent written confirmation of the dismissal of the applicant including some mention of the basis for dismissal, was highly regrettable. THE CASE FOR THE APPLICANT 16 The applicant was represented by Mr G Gillett, a solicitor. Mr Gillett made submissions which challenged the veracity of the evidence provided by Mr Parsons. 17 Mr Gillett submitted that the Commission should disbelieve the substantial proportion of the evidence provided by Mr Parsons. Mr Gillett submitted that Mr Parsons was an unreliable witness. Mr Gillett submitted that the Commission should instead prefer the applicant's evidence about the circumstances of the argument during which she was dismissed. 18 Mr Gillett made further submissions which underlined the absence of procedural fairness that he said existed in this instance. Mr Gillett said that the applicant had not been provided with written warnings about any of the matters which the employer subsequently sought to rely upon as basis for dismissal. Mr Gillett said that the dismissal in this case qualified in respect of all of the criteria under section 84 of the Act. Mr Gillett also mentioned section 88 of the Act and the various provisions contained therein. 19 Mr Gillett made submissions which sought to have the Commission make adverse findings regarding the absence of potentially important witnesses and evidence in the form of a Keno ticket and the security video relevant to the time at which the argument between the applicant and Mr Parsons occurred. Mr Gillett said that the Commission should be prepared to infer that this important evidence had not been produced because it would not have assisted the employer's case. 20 Mr Gillett submitted that the evidence should lead the Commission to find that Mr Parsons had had a "brain snap" and had dismissed the applicant during the argument on 9 August 2004. Mr Gillett also submitted that Mr Parsons had not had the decency to provide the applicant with a subsequent letter of dismissal, nor had he followed the procedure that was mandatory under the relevant industrial instrument, the Club Employees State Award. 21 Mr Gillett submitted that the applicant's dismissal was harsh and unjust, and he sought that the Commission should find in her favour. THE CASE FOR THE EMPLOYER 22 Ms H Carayannis, from the Registered Clubs Association of New South Wales, appeared for the employer. Ms Carayannis commenced her submissions by asserting that the respondent had acted reasonably in the circumstances, and that the application should be dismissed. 23 Ms Carayannis made submissions which highlighted the applicant's employment history. In this respect, Ms Carayannis submitted that the applicant had a history of poor performance involving various incidents that required verbal warnings. Ms Carayannis submitted that the incident involving the applicant's dismissal should not be viewed in isolation, and that therefore the Commission should have regard for the various historical issues regarding the applicant's employment. 24 Ms Carayannis further submitted that the applicant had been provided with procedural fairness in respect to her dismissal. Ms Carayannis submitted that the applicant had conceded that she did use inappropriate and offensive language to the employer's General Manager. Ms Carayannis said that the General Manager did not intend to dismiss the applicant but had simply asked her repeatedly to go home. Ms Carayannis said that it was only after the applicant had made the highly offensive and inflammatory comments to the General Manager, that the decision to dismiss was taken. Therefore, according to Ms Carayannis there should be no finding of any procedural error on the part of the employer. 25 In respect to the factual conflict about the detail of the argument between the applicant and Mr Parsons, Ms Carayannis submitted that the applicant should not be believed. Ms Carayannis submitted that the applicant's evidence had been tainted by a misrepresentation that she had made regarding possession as opposed to ownership, of a motor vehicle. Ms Carayannis submitted that the applicant had sought to misrepresent the motor vehicle question by stating that she did not own a motor vehicle, yet at the time of her dismissal she drove a motor vehicle even though it was apparently not owned by her. Ms Carayannis submitted that this was a deliberate misrepresentation by the applicant and should act so as to successfully challenge the veracity of her evidence wherever that was contested. 26 Ms Carayannis made further alternative submissions which were predicated upon the Commission finding that there was some basis for the claim to succeed. In respect to these alternative submissions, Ms Carayannis concluded that if the applicant was successful, any amount of compensation that might be provided should be only a nominal figure. Ms Carayannis submitted that even if the dismissal was not properly implemented, it should also be found that no reasonable employee would still expect to have a job after having made the comments that the applicant admitted she had made to her employer. 27 Ms Carayannis returned to her primary submissions and urged the Commission to reject the application as she said that there was nothing harsh, unjust or unreasonable about the applicant's termination of employment that should warrant the Commission's intervention. CONSIDERATION 28 The consideration of this matter has first focussed upon the factual conflict existing in respect of the important sequence of events that occurred during the argument between the applicant and the employer's General Manager, Mr Parsons. There was no explanation to justify the absence of a letter of dismissal and that error, coupled to the uncontested evidence of procedural defect vis-a-vis, the provisions of the relevant industrial instrument, would provide for, prima facie, success of the claim. 29 However, it is necessary to examine any underlying substantive basis for dismissal even where the procedure used to implement the dismissal was clearly erroneous. In some cases findings in respect of the substantive justification for dismissal can displace any erroneous procedure. Therefore in this instance the balance between the procedural errors has been contemplated against any substantive justification. Therefore the Commission has been required to settle the contested recollections of the sequence of events during the argument between the applicant and Mr Parsons on 9 August. 30 The central question that underpins the factual conflict involved whether or not the applicant had made the inappropriate and insulting comments to Mr Parsons before or after he dismissed her. Although there was some minor conflict in respect of the precise words contained within the insult, the Commission is prepared to accept that the applicant's version of the insult could be adopted for purposes of consideration. In this respect the applicant deposed that she said the offending words to Mr Parsons after he had responded in the affirmative to her question as to "Are you sacking me?". The applicant deposed that she then said: "That would be right, I try to do the right thing by the club, you take it out on people who try to do the right thing, you keep the others because they are younger and grab you on the arse." 31 This insult made by the applicant to Mr Parsons has also been referred to as the "touching up" comment. Although Mr Parsons provided evidence that he recalled that the word "cock" was used in addition to the word "arse", for present purposes, the insulting comment can be considered to have been confined to the use of the word "arse". In any case, the inference from the "touching up" comment is unambiguous, and even in the form as deposed by the applicant, would obviously provide for understandable insult and offence as was taken by Mr Parsons at the time. 32 The evidence about the conversation between the applicant and Mr Parsons before the "touching up" comment was reasonably consistent. The applicant had been engaged in discussion by Mr Parsons who had left his office and sought out the applicant in the bar area of the Club. The evidence clearly established that Mr Parsons started the debate with the applicant in a confrontational manner by stating words to the effect; "I have had enough of this crap". It would therefore be unsurprising that the subsequent discussion degenerated into an argument. This was an entirely inappropriate and unprofessional means for dealing with issues regarding conduct or performance concerns with employees. 33 As the argument escalated, Mr Parsons decided that he would send the applicant home. Mr Parsons said that he was not intending to dismiss the applicant but simply tried to avoid further escalation of the argument by having her leave the workplace immediately. This directive must be considered in the contest of the confrontational approach that was initiated by Mr Parsons. 34 As the argument escalated, the applicant was alleged to have called Mr Parsons a "fucking fool", although the applicant rejected this. As the argument escalated Mr Parsons decided that he would resolve the dilemma by sending the applicant home. It would be reasonable and understandable for the applicant to then question that directive, particularly as to whether or not it represented her dismissal. It appeared that at least initially, Mr Parsons did not confirm that the applicant was being dismissed. The applicant asked on several occasions for clarification as to whether or not she was dismissed. Then either the applicant issued the insulting comment that precipitated confirmation of dismissal, or alternatively, in frustration, Mr Parsons confirmed dismissal and then the applicant made the "touching up" comment. 35 It is understandable that recollections of the precise words said, and the sequence in which particular words were uttered during a heated argument are subsequently the subject of great contest. In this instance an examination of the respective recollections of the applicant and Mr Parsons displays no deliberate attempt to provide any untruthful testimony regarding the event. Rather, both the applicant and Mr Parsons genuinely believed that their respective recollections of the sequence of the events on 9 August was correct. Both versions are also capable of rational and plausible support. 36 Consideration must then involve the introduction of the evidence provided by Ms Florence Lagan. As mentioned earlier in this Decision, Ms Lagan was both a friend of the applicant and also a Director of the employer. Immediately following the dismissal, the applicant went to the home of Ms Lagan and spoke to her about the events that had occurred only moments before. Therefore the evidence provided by Ms Lagan about what the applicant told her of the circumstances surrounding the dismissal has become very important. Ms Lagan was essentially an unbiased independent witness who obtained the first-hand recount from the applicant only a matter of minutes after the event actually occurred. It is important therefore to analyse whether her evidence supports the chronology of events in respect of the "touching up" comment as suggested by the applicant, or the chronology as deposed by Mr Parsons. 37 The evidence provided by Ms Lagan regarding the important sequence of events during the argument between the applicant and Mr Parsons is obviously confined to the applicant's recount of the event a short time after its occurrence. It must be acknowledged that Ms Lagan was not a witness to the argument. Therefore Ms Lagan's evidence is strictly hearsay from the applicant and must be treated with great caution. The applicant was in Ms Lagan's house and according to the affidavit of Ms Lagan the applicant recounted the circumstances of a few minutes earlier in the following terms: "Flo: "Why were you sacked?" Jenny: I refused to do the sign-in book and said that I would burn the incident book. I said this to Lee Downie and then she reported this to Garry Parsons. This was such a joke. Garry then came up to see me. We had a few words and then asked me to leave. I told him that he only wanted the girls who touch him up to stay. When I asked him if I was sacked now, he said 'yes'." Exhibit 4 paragraph 3. 38 The evidence from Ms Lagan about what the applicant had told her about the event suggests that after the applicant had made the "touching up" comment she further enquired as to whether she was sacked, and it was at that point that Mr Parsons confirmed dismissal. This accords broadly with the sequence of events as deposed by Mr Parsons. In addition it is relevant to examine the testimony provided by Ms Lagan during cross-examination and the following extract from transcript is relevant: "Q. ... Anything else? A. Yes, she said that she spoke to Gary and Gary said, spoke back to her, I do not know the exact words, but she did repeat that only the young girls can touch him up. And then she got sacked." Transcript of proceedings (04/02/05) @ page61. 39 As can be seen from the above extract from transcript, the response by Ms Lagan to the fairly innocuous question "Anything else?" provided further support for the sequence of events to be that the "touching up" comment came before and not after confirmation of the dismissal. 40 If some justifiable substantive basis for dismissal has been established by way of the "touching up" insult made by the applicant to the General Manager, the Commission must then consider whether this misconduct, in the context of the particular circumstances of this case, could operate so as to displace the procedural deficiencies that were uncontested. 41 It would be understandable that Mr Parsons would be offended by the "touching up" insult made by the applicant. This comment would represent misconduct that would ordinarily justify dismissal. However, it must be remembered that the argument was in large part a predictable consequence of the confrontation that was initiated by Mr Parsons. When considered in this context it would seem that although there would ordinarily be some justifiable basis for dismissal, it would not operate so as to overcome the unreasonableness attached to the failure to provide for any subsequent written confirmation of dismissal. In other words it would be conceivable that had Mr Parsons not initiated the argument with the applicant, and had he subsequently confirmed dismissal by way of proper written advice, he would have been justified in summarily dismissing the applicant because of the insulting "touching up" comment. However, in this case because of the particular circumstances surrounding the misconduct, it would seem that the balance between the substantive basis weighed against the procedural errors, would not overcome the procedural deficiencies. CONCLUSIONS 42 In this case the applicant was summarily dismissed during a heated verbal argument. As might be anticipated, there were clear procedural errors inherent in the employer's dismissal process. In particular, there was no justifiable reason for the absence of a letter of dismissal confirming the termination and the basis for that decision. 43 Despite the procedural deficiencies, there was considerable contest about the alleged underlying substantive basis that gave rise to the summary dismissal. 44 Following a careful and detailed analysis of the conflicting evidence regarding the chronology of the words said during the argument between the applicant and Mr Parsons, the Commission is persuaded to adopt the version as deposed by Mr Parsons, rather than that of the applicant. The Commission's conclusion is drawn largely upon the evidence provided by Ms Lagan, an independent witness, who received an account from the applicant of the circumstances surrounding her dismissal shortly after the event. Consequently, the Commission has concluded that the applicant made the insulting "touching up" comment to Mr Parsons before confirmation of dismissal, and that that comment acted as the catalyst for her dismissal. 45 Following detailed consideration of the totality of the events surrounding the dismissal, the Commission is not prepared to conclude that the substantive basis, although justifying dismissal in some circumstances, could in this case, overcome the procedural deficiencies. 46 Therefore the Commission finds that the applicant's dismissal was unreasonable. 47 The applicant has not sought reinstatement or re-employment as remedy for her claim. Instead the applicant has sought monetary compensation. The Commission forms the view that reinstatement or re-employment of the applicant would be impracticable and that monetary compensation should be provided as appropriate remedy for the applicant's unreasonable dismissal. 48 The amount of compensation has been determined having regard for the applicant's attempts to find alternative employment and the remuneration received in alternative employment. In addition, the quantum of compensation has been determined having cognisance of the findings in respect to the underlying substantive basis for dismissal. ORDERS In this matter, for the reasons outlined herein, I have Determined that the dismissal of the applicant was unreasonable and I hereby make the following Orders: 1. The Commission Orders that the employer pay to the applicant an amount of compensation of $3,225.00. This amount is a gross figure and appropriate taxation treatment is a matter for the Parties. 2. The amount of compensation specified in Order 1 above is to be paid by the employer to the applicant within twenty one days from the date of this Decision. oooOOOooo DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.