Industrial Relations Commission of New South Wales CITATION : Yifan Yang and Cathay Herbal Laboratories Pty Ltd [2001] NSWIRComm 197 APPLICANT PARTIES : Mr Yifan Yang RESPONDENT Cathay Herbal Laboratories Pty Ltd FILE NUMBER: 494 of 2001 CORAM: Sams DP Termination of employment - unfair dismissal - letter of resignation - whether resignation given under pressure - applicant absent without permission - employer's reasonable directions - unrepresented litigant CATCHWORDS : Held, no coercion or pressure to resign - resignation freely given and consistent with past conduct - no dismissal at employer's initiative - Commission has no jurisdiction - application dismissed. LEGISLATION CITED : Industrial Relations Act 1996 Buckley and Western Sydney Regional Public Tenants Council (unreported, Sams DP, IRC2348 of 2000, 24 November 2000) Rajas and Galapone Pty Ltd (unreported, Redman C, IRC359 of 1994, 31 August 1994) Allison v Bega Valley Council (63 IR 68) Nicholls and Central Sydney Area Health Service (unreported, Sams DP, IRC4131 of 1999, 28 August 2000) CASES CITED : Clark v Pittwater RSL Club Ltd (84 IR 309) Claric 218 Pty Ltd t/as Sanity Music v Meldrum (91 IR 296) St Vincents Hospital Sydney Pty Ltd v Harris (unreported, Peterson, Schmidt JJ, O'Neill C, IRC5932 of 1997, 28 May 1998) Britton v Riverstone Public School (unreported, Schmidt J, Sams DP, McLeay C, IRC5504 of 1999, 6 May 1999) Bates v Gundagai District Services Club (unreported, Walton VP, Sams DP, Redman C, IRC4710 of 1999, 14 April 2000) Police Service of New South Wales v Batton (unreported, Wright P, Hungerford J and Connor C, IRC4463 of 1999, 23 May 2000) HEARING DATES: 08/13/2001 DATE OF JUDGMENT: 08/31/2001 APPLICANT Mr Y Yang, unrepresented LEGAL REPRESENTATIVES: RESPONDENT Ms P Nair Employers First JUDGMENT: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM : SAMS, DP 31 August 2001 Matter No. IRC01/494 YIFAN YANG AND CATHAY HERBAL LABORATORIES PTY LTD. Application by Yifan Yang re unfair dismissal pursuant to section 84 of the Industrial Relations Act 1996 DECISION [2001] NSWIRComm185 1 This is an application, pursuant to s84 of the Industrial Relations Act, 1996 ("the Act"), filed by Yifan Yang ("the applicant") seeking relief in respect to his alleged unfair dismissal by Cathay Herbal Laboratories Pty Ltd ("the respondent") on 15 January 2001. 2 The application was listed for directions and conciliation on 23 March 2001, at which time Mr Yang represented himself and Ms P Nair from Employers First represented the respondent. Following these proceedings and a private conference between the parties, the Commission, pursuant to s87 of the Act, formed the view that further conciliation would be unsuccessful and set the matter for arbitration. Directions for the filing and service of evidentiary material were issued at this time. Relevant Background 3 The applicant had worked for a total of eleven years with the respondent - six years full time and five years for two days a week. He described himself as a consultant Herbalist with a Masters in Chinese Medicine. His duties were to provide technical support concerning the use of traditional Chinese medicines, assistance with seminars and treating patients. 4 On 22 August 2000, the applicant made an application for extended leave (about six months). The employer, and owner of the Company, Mr Peter Ryan, did not approve the leave as he queried the applicant's accrued entitlements. Various exchanges occurred, resulting in a second application for six months' leave being received by the respondent, on 6 September 2000 - the day after the applicant proceeded to take the leave. Mr Ryan responded the same day, by informing the applicant his leave had not been approved and that he was absenting himself from work without permission. 5 The applicant sent another application dated 7 September 2000, seeking a holiday in two blocks, with no dates specified on the application form. 6 Mr Ryan did not respond until 19 October 2000, when he wrote again to the applicant, insisting that agreement was necessary for leave to be approved and re-stating the applicant was absenting himself without permission. 7 Throughout this time, the applicant maintains that Mr Ryan had given his verbal approval for the leave to be taken. Mr Ryan denies this claim. 8 On 5 January 2001, four months after the applicant proceeded on leave, Mr Ryan wrote to the applicant suspending his employment and stopping his salary from that date. He advised that all leave entitlements had now been exhausted and expressed concern with the applicant's attitude and certain allegations of impropriety, made by the applicant, against the Company. Mr Ryan requested a meeting to discuss these matters. The applicant responded in writing on 10 January 2001, challenging his leave entitlements and claiming that Mr Ryan had told him not to return to the office. 9 The applicant resigned by letter of 15 January and it is relevant to quote it in full: Attention: Peter From: Yifan Yang 15/1/2001 Mr. Peter Ryan Chairman Cathay Herbal Dear Peter, Re: Resignation from Cathay Herbal I would like to tell you that I decide to resign from the position of Cathay Herbal Laboratories. I think I have been serving long enough for your company. Could you please kindly accept my resignation and * Write me a reference for having worked in Cathay. * Send me a cheque of 1% CH-100 for the year of 2000. (My day leave Cathay will be 22/3/2001, please pay another amount when it is due). * Pay off the salary of 22.43 days ($6056.10 including 448.6 super and 1020.57 tax) (19.7 days unpaid, plus another 2.73 days from the holiday during 1/1/2001 to 22/3/2001, about my holidays you can check with our accountant, details attached). * Settle the matter of 15% of Cathay Wholesale - CH-100. I am writing for Karin to arrange an appointment for me to meet you. I would like to have this matter settled within one week. I am sure we can solve the problem without the Industry Mediation. Thank you. Good Regards Yours Sincerely (Signature) Yifan Yang 10 The reference in the letter to "CH-100" is to a claim by the applicant for a share in the business. This claim is subject to separate proceedings in another jurisdiction and is not materially relevant to the matter before this Commission. The Applicant's Case 11 The applicant claims that the respondent, in the person of Mr Ryan, had decided to get rid of him because of his claim to a profit share in the company. He said that Mr Ryan was looking for excuses to replace him with a Dr Lily in June or July 2000. He said Dr Lily had told him this. He said Mr Ryan discussed with another employee, Xiao Li and Dr Lily plans to sack him. He said, the annual leave issue was the chance he had to sack him. 12 The applicant gave evidence that written authority to take leave had never been necessary and anyway, he believed Mr Ryan had agreed to his taking of leave. In cross-examination, he said he knew after September 2000 that written approval was necessary. He acknowledged that on 19 October he knew he was absenting himself without permission. He said he agreed to come back to work on 24 October, unless his holiday was approved in the meantime. 13 The applicant believed he was unfairly dismissed on 5 January 2001, when he was suspended without pay. He said he was forced to resign on 15 January after being told by the Department of Industrial Relations that this was the only way he would get his accrued annual leave. He conceded in cross-examination that he had told the Department he had already been sacked. Asked about the letter of resignation, Mr Yang said he used "soft words" because he didn't want an argument with Mr Ryan. He was then taken to a letter of 14 July 2001, in which the applicant made a number of threats, including resigning and destroying Mr Ryan's business. He explained that he was very angry and emotional and had been reluctant to do so. He agreed he was out for "some revenge, something like that, yeah" (T. p26). He later said, "I was very angry, want to take revenge". 14 The applicant said he had found it difficult to find another job and is suffering from insomnia, stress, anxiety and depression. The Respondent's Case 15 Mr Peter Ryan is the Executive Chairman and owner of Cathay Herbal Laboratories Pty Ltd. He provided affidavit and oral evidence. 16 Mr Ryan deposed that, despite clashes with the applicant from time to time, at no time did he threaten the applicant with dismissal. Mr Ryan described the chain of events from 22 August 2000, when the applicant sought extended leave. He denied ever approving his leave and said that all employees were required to submit a leave application and have it approved. 17 Mr Ryan said he was not surprised by the applicant's resignation as he had threatened to do so on other occasions. He said that when he received the resignation letter, he agreed to pay him the amount he was seeking. 18 Ms Nair submitted the applicant had failed to prove that a dismissal had occurred (see Buckley and Western Sydney Regional Public Tenants Council, unreported, Sams DP, IRC2348 of 2000, 24 November 2000). Although the respondent had repeatedly refused approving the leave, Mr Ryan had continued to pay the applicant from 5 September 2000 to 5 January 2001. Despite deciding that he had been dismissed at this point, the applicant wrote a letter of resignation on 15 January, giving two months notice. It was highly unlikely, Ms Nair said, that the Department of Industrial Relations told the applicant that he had to resign to receive his entitlements. She said, the applicant, on his own evidence, had not been dismissed. In the alternative, Ms Nair submitted that the applicant abandoned his employment being fully aware that his annual leave had not been approved and that his absence was unauthorised (see Rajas and Galapone Pty Ltd , unreported, Redman C, IRC359 of 1994, 31 August 1994). 19 As to whether there was a constructive dismissal, Ms Nair said that the evidence demonstrated that the respondent had not, in any way, compelled or unduly influenced the applicant to resign (see Allison v Bega Valley Council 63 IR 68). His own evidence was that he was acting on the advice of the Department of Industrial Relations. There had been a number of other occasions where the applicant had threatened to resign. He had previously threatened to harm the respondent's business. 20 Ms Nair submitted that, even if there was a finding that a dismissal had occurred, it could not be found to be "harsh, unjust or unreasonable". The applicant deliberately and consistently defied a clear communication that his leave had not been approved and he was absenting himself from work without permission. She submitted that this conduct was a sufficient basis for his dismissal. 21 The respondent reserved its rights to seek costs on the basis that the application was "frivolous and vexatious". CONSIDERATION Unrepresented litigants 22 In a number of recent decisions, the Commission has discussed the difficulties faced by unrepresented litigants, particularly applicants, in Pt 6 ch 2 proceedings. 23 The Commission intends to refer to my comments in Nicholls and Central Sydney Area Health Service (unreported, Sams DP, IRC4131 of 1999, 28 August 2000), and direct the applicant's attention to an extract from that decision (at para 71-74, inclusive): In view of these circumstances, it is appropriate that I should refer to the principles that the Commission should adopt in litigation involving an unrepresented party. The guiding principle is a simple one: " to ensure all parties are afforded the benefits of the rules of natural justice ". For a helpful discussion of the term 'natural justice' in the context of an unrepresented litigant see Davidson v Aboriginal & Islander Child Care Agency ( Ross VP, Watson SDP and Eames C) Print Q0784, 12 May 1998. While the principle of natural justice might seem simple enough, its application in an intensely emotional and difficult litigation is not always so. It is often a delicate balance involving a number of sensitive issues such as ensuring an unrepresented litigant is aware of his or her rights, ensuring the trial judge does not become an adviser or advocate and ensuring an orderly and sensible conduct of the proceedings. Two authorities are apposite. In Regina v Gidley , 3 NSWLR 168, the Court of Criminal Appeal said: The duty of a trial judge to ensure that every accused has a fair trial thus obliges him to give an accused who is unrepresented such information and advice concerning his rights as is necessary to put him in a position where he can make an effective choice whether he should exercise those rights, but the trial judge must make it clear that he is not advising the accused either that he should extend those rights or how he should conduct his case. In Regina v Zorad , 19 NSWLR 91, the New South Wales Court of Appeal held that: 1. An accused who elects to be unrepresented is not entitled because of that election to be given any advantage not enjoyed by a represented person. 2. The duty of a trial judge to give an unrepresented accused such information and advice as is necessary to ensure that he has a fair trial: a) would include, if it became necessary, an explanation as to the form in which questions should be asked, but it is not to put the question in that form for the accused. b) would include the giving of advice that, notwithstanding a ruling on the voire dire as to the voluntariness of admissions, the accused is permitted to raise the same factual matters before the jury: such advice is necessary to ensure that the unrepresented accused is put in a position where he can make an effective choice as to the exercise of his rights but does not extend to advising him how this may be done. c) would include, where comment was going to be made in relation to the accused's failure to comply with the rule in Browne v Dunn , advice of the existence to that rule. The Commission's obligation to unrepresented parties must always be consistent with the legislative framework in which the Commission operates. The Commission, of course, is guided by the general statutory instruction in Pt 5 of the Act - Procedure and Powers of the Commission. In particular I refer to s162(1): The Commission may, subject to this Act, determine its own procedure. and s163(1) The Commission: (a) is not bound to act in a formal manner, and (b) is not bound by the rules of evidence and may inform itself of any matter in any way that it considers to be just, and (c) is to act according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms. 24 The applicant provided a detailed statement supported by numerous annexures. He was not inhibited in any way from bringing such other matters as he deemed relevant to his case. Despite the dubious relevance of some of his evidence and whether it was admissible, I am satisfied that the applicant had every opportunity to put his case without hindrance or undue technical objection. 25 At the conclusion of the applicant's evidentiary case, Ms Nair made an application to "strike out" the application on the grounds that the applicant's own evidence was sufficient to justify a jurisdictional finding against the applicant; namely that he had resigned and had not been dismissed. 26 Notwithstanding the undoubted merit of Ms Nair's application, I declined to grant it and required the respondent's case to be presented in full. This course was adopted in light of the applicant's self representation and the Commission's obligation to ensure that he be afforded every opportunity, should he so choose, to test the employer's evidence. Jurisdiction of the Commission 27 The jurisdictional basis for a competent application, under Pt 6 ch2 of the Act, is firmly grounded in whether a dismissal, in law, has taken place. A dismissal can only be a termination of the employee's employment by the employer. The authorities have variously described such a termination as a termination at the employer's initiative, or where the conduct or actions of the employer is the real and effective initiator of the termination of employment or in the case of resignation, whether such resignation was freely given without any taint or coercion (see Allison v Bega Valley Council (63 IR 68); Clark v Pittwater RSL Club Ltd (84 IR 309); Claric 218 Pty Ltd t/as Sanity Music v Meldrum (91 IR 296); St Vincents Hospital Sydney Pty Ltd v Harris (unreported, Peterson, Schmidt JJ, O'Neill C, IRC5932 of 1997, 28 May 1998); Britton v Riverstone Public School (unreported, Schmidt J, Sams DP, McLeay C, IRC5504 of 1999, 6 May 1999); Bates v Gundagai District Services Club (unreported, Walton VP, Sams DP, Redman C, IRC4710 of 1999, 14 April 2000); and Police Service of New South Wales v Batton (unreported, Wright P, Hungerford J and Connor C, IRC4463 of 1999, 23 May 2000)). 28 There can be no doubt the applicant resigned his employment on 15 January 2001. However, he believed he was dismissed on 5 January 2001 when his salary was stopped. One might reasonably ask, why he would feel the need to resign, if he had already been dismissed? In any event, the applicant was not unfamiliar with threats to resign. He agreed he had threatened to resign over his salary and his demand for shares in the Company (T. p23). He had threatened to resign in 1992 and work in his wife's clinic after an argument with Mr Ryan. He had also threatened to do so in 1996 when he wasn't paid a share in the profits of the business. 29 Again in July 2000, he wrote an extraordinary and provocative letter to Mr Ryan. In it, he was very critical of another employee, Xiao Li, who he believed was plotting to take over the Company. He believed she should be sacked, claiming she was "greedy, selfish and immoral". He guaranteed the Company would collapse if she took control and he would actively seek to take customers away to a rival company and destroy Mr Ryan's business. He threatened to resign. It is interesting to note, although not surprising, that the applicant did not include this threatening letter in his tendered material. 30 The 15 January letter of resignation is hardly couched in language that could be interpreted as a forced resignation. It is friendly and displays not a hint of coercion or pressure to do so. In it he seeks to obtain further payments from the Company and settlement of his share claim. This letter does not sit comfortably with his aggressive and threatening letter of July 2000. If he was in any way aggrieved in January 2001, he certainly didn't display the same level of vehemence, indeed none at all, that he was clearly capable of. 31 In my opinion, the applicant's only purpose in resigning was to secure his alleged entitlements to annual leave and other claims. He gave evidence that someone at the Department of Industrial Relations had told him he had to resign to secure his annual leave accruals. On this matter, I simply do not believe the applicant. Even allowing the applicant the benefit of the doubt, he may have misunderstood the Department's advice. Nevertheless, three issues are relevant here: 1. The applicant produced no evidence of the conversation with the Department, or who he spoke to. 2. The applicant had demonstrated a thorough knowledge of his rights and entitlements. With this knowledge, it is inconceivable that he would have believed that the only way to secure his annual leave was to resign. 3. At no time, did he raise this belief with the employer. 32 In my view, the applicant, freely and without coercion, chose to resign. His decision was purposeful, well thought out and executed. He did so in the face of a determined desire to take extended leave without permission and with the knowledge of numerous warnings that he was risking his future employment by absenting himself without permission. 33 One additional matter needs comment. The applicant claimed that he was not required to seek written permission for annual leave. Mr Ryan said all staff were required to seek formal written approval. Even if this was the applicant's understanding, it is not relevant to the circumstances leading to the applicant's resignation. He was warned four times that he was absent without permission and required written approval for leave. Without a doubt, he was aware the employer had not agreed to his requests. This was the crux of the matter. He was on unauthorised absences for four months. The employer was prepared to be tolerant - perhaps beyond any reasonable expectation. The respondent paid the applicant throughout this period and paid him all that he claimed when he resigned. Mr Ryan just wanted to end the matter and I am not a bit surprised. Mr Ryan's frustration and desire to bring this saga to a close was perfectly understandable. 34 Having so concluded, it must follow that the applicant was not actually, or constructively, dismissed on 5 January 2001, or at any other time. Ipso facto , there was no dismissal by the employer. In the result, there is no jurisdiction for the Commission to entertain the applicant's claim of alleged unfair dismissal. The application is dismissed for want of jurisdiction. 35 Notwithstanding this finding, I feel bound to observe that had the employer dismissed the applicant at any time, on or after 5 January 2001, I would be unable to conclude that such a dismissal was "harsh, unjust or unreasonable" within the meaning of the Act 36 On the contrary, the employer, to my mind, would have been perfectly entitled to have dismissed the applicant. The persistent refusal to obey a reasonable instruction to attend for work was nothing short of misconduct. 37 These substantive proceedings are concluded. 38 Any application for costs must be made by notice of motion within fourteen (14) days of today. Peter Sams Deputy President 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.