Industrial Relations Commission of New South Wales CITATION : Wan v Sydney Tower Restaurants Pty Ltd, Zhang v Sydney Tower Restaurants Pty Ltd [2003] NSWIRComm 60 APPLICANTS Antonio Kwong Wing Wan PARTIES : Peter Tingfang Zhang RESPONDENT Sydney Tower Restaurant FILE NUMBER: IRC 5921 and IRC 5922 of 2001 CORAM: Grayson DP Dismissals, allegations of misconduct, systematic misuse of computerised billing system, onus of proof, waiters acting as cashiers, allegations lacking objective evidence CATCHWORDS : Held, dismissals unfair, compensation ordered LEGISLATION CITED : Industrial Relations Act 1996 Amin v Burswood Resort Management, Morley v Burswood Resort Management (1998) 78 WAIG 2441 Antonakopoulos v State Bank of New South Wales (1999) 91 IR 385 Australian Workers Union (WA) v W M C Resources Ltd (1998) 78 WAIG 1065 Coward v Gunns Veneer Proprietary Ltd FedCts(Tas) 0696/98, BC9802568 Barrett v Crown Street Women's Hospital, Re [1947] AR (NSW) 565 Bigg v NSW Police Service (1998) 80 IR 434 Bi-Lo Pty Ltd v Hooper (1992) 53 IR 224 Brigginshaw v Brigginshaw (1938) 60 CLR 336 Curro v Bell Sports Australia [1999] NSWIRComm 281 Humphries v Cootamundra Ex-Services and Citizens Memorial Club Limited [2002] NSWIRComm 225 Homebush Abattoir, Re [1966] AR (NSW) 371 Jones v Dunkel & Anor (1959) 101 CLR 298 CASES CITED : Kirilo Nikolovksi v BHP Integrated Steel [1999] NSWIRComm 282 Kolhagen v Cargill Foods, Australia [1999] NSWIRComm 107 Linsen v Apollo Bay Supermarket (1997) 71 IR 339 M v M (1988) 63 ALJR 108 Pastrycooks Employees, Biscuit Makers Employees and Flour and Sugar Goods Workers Union (NSW) v Gartrell White (No.3) (1990) 35 IR 70 Steven Watson and Blacktown City Council [1998] NSWIRComm 381 Taggart v Bell Sports Australia [1999] NSW IRComm 408 Wallace v Deering Auto Electrics (1985) 12 IR 34 Wang & Others v Crestell Industries Pty Limited (1997) 73 IR 454 WD & HO Wills (Australia) Ltd v Jamieson [1957] AR (NSW) 547 North v Television Corporation Ltd [1976] 11 ALR 599 Western Suburbs District Ambulance Committee v Tipping [1957] AR (NSW) 273 Zahra v Rooty Hill RSL Club Ltd [1998] NSWIRComm 187 HEARING DATES: 09/12/2002; 09/13/2002; 09/23/2002; 09/27/2002; 10/04/2002; 02/21/2003 DATE OF JUDGMENT: 03/21/2003 APPLICANTS Mr A McAvoy of counsel instructed by Diamond Peisah Solicitors LEGAL REPRESENTATIVES: RESPONDENT Mr B Cross of counsel instructed by Restaurant & Catering NSW JUDGMENT: - 6 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES Coram: Grayson DP Friday, 21 March 2003 Matter No IRC 5921 of 2001 ANTONIO KWONG WING WAN V SYDNEY TOWER RESTAURANTS PTY LTD Application by Antonio Kwong Wing Wan re unfair dismissal pursuant to s 84 of the Industrial Relations Act 1996 Matter No IRC 5922 of 2001 PETER TINGFANG ZHANG V SYDNEY TOWER RESTAURANTS PTY LTD Application by Peter Tingfang Zhang re unfair dismissal pursuant to s 84 of the Industrial Relations Act 1996 DECISION [2003] NSWIRComm 60 1 These matters were heard concurrently throughout September 2002 and October 2002 with the assistance where required of a Community Relations Commission interpreter in Cantonese. The matters were thereafter adjourned for submissions which concluded with the filing of the applicants' submissions in reply on 21 February 2003. 2 Hearing of the matters followed a lengthy and protracted course involving police investigations and Local Court proceedings, the outcome of which are unknown to the Commission and therefore have no bearing on the essential question to be determined namely, whether the applicants or either of them were unfairly dismissed within the meaning of Part 6 of Chapter 2 of the Industrial Relations Act 1996 (the Act). 3 The applicants commenced employment as waiters with the respondent in 1995 and were dismissed from that employment on 16 August 2001. It is alleged by the respondent that the applicants misconducted themselves in their use of a computerised ordering and billing system within the restaurant and in so doing misappropriated funds belonging to the respondent. 4 Evidence was taken throughout the course of the hearing from the applicants, and in their case, from fellow waiter and Australian Liquor, Hospitality and Miscellaneous Workers Union (ALHMWU) delegate Mr Sheikh Islam, and also in the form of documents comprising computer printouts, taxation and Centrelink records, screen dumps, email communications and police witness statements. 5 From the respondent's side of the record evidence was taken from the following witnesses: · Mr Preshan Mendis, Executive Restaurant Manager · Ms Kathy Williamson, Financial Controller · Mr Rhys Rogers, Manager Industrial Relations, Restaurant and Catering Industry Association of NSW · Mr William Little, Restaurant Manager · Mr Jean-Marie Pradeaux, Restaurant Manager · Mr Thye Bee (Richard) Soon, Restaurant Manager · Mr Leonard John Hill, Managing Director Belvoir Information Technology Pty Ltd 6 It might usefully be observed at this point in the interests of conveniently disposing of the matter, that the allegations of the applicants directed towards victimisation based broadly speaking on their union activism, have not been made out in my opinion and nor, to be fair to the applicants, are they allegations which were vigorously pressed or relied upon at the end of the day. The cases turn, as I am disposed, if not exclusively then in the main, on the allegations of misconduct raised by the respondent and issues incidental thereto and I propose to deal with them on that basis. 7 The allegations of misconduct may be broadly described in the interests of brevity, in the following way. A computer system known as the Belvoir Point of Sale system was purchased and used in the respondent's Centrepoint Tower restaurant at all material times. The applicants and other employed waiters operated the system by using a personalised swipe card to gain access at the terminal and then by using a touch screen to input the order taken from the customer. The order was electronically transferred to the kitchen for processing by the kitchen staff and then for delivery to the customer. The computer would also generate an account by specific customer or group of customers; by specific table; by item of food or beverage ordered; by unit price per item and by total price per bill or "check" as they were called. 8 As customers finished their meals they would be given the bill or "check". Payment by cash or credit card would be made directly to the waiter who also acted as cashier. As one might imagine in a busy a la carte restaurant such as this one, there are many variations of the theme and content in the process simply described above and much of the evidence in the proceedings was directed towards assisting the Commission in gaining an insight into the technicalities of the computerised process in order that the competing contentions of the parties may be tested and evaluated. It is unnecessary to recite those technicalities for the purpose of these deliberations save as to some of the variations to which I refer above. 9 For example, the computerised process allowed waiters to "split" items from one "check" and "merge" items with another "check". This was a procedure which was allegedly used or misused by the applicants to misappropriate money. It is alleged that the applicants took orders which included, in addition to the main items, garlic bread, coffee, fresh vegetables and/or French fries. The customers would receive or be served with all items ordered and would then receive and make payment upon a printed "check" containing all items ordered and received. After payment was made by the customer, the applicants would allegedly remove certain of the items from the "check" by using the "split" function on the computer. They would then "cash out" at the end of the shift, allegedly keeping payment they had received from customers for items which had subsequently been removed from the computer record. It will be appreciated from that broadly stated description that it was necessary for the amount paid in by the applicants when they "cashed out" at the end of the shift to equate to the total amount billed by the applicants throughout the shift. The essence of the respondent's allegation is that the applicants manipulated the computer system throughout the shift in order to generate a lower total than they had actually billed and collected throughout the shift and in so doing, that they paid in an amount less than the proper amount at the end of the shift and kept the rest. 10 The respondent began to suspect wrongdoing on the part of the applicants in mid-2001 when it was noted that they were apparently using the "split" and "merge" functions on considerably more occasions than other waiters. Mr Hill was contacted and asked, as the expert, to analyse the computer records and report to the respondent as to whether there was any irregularity. He concluded that the applicants were misusing the system and so advised the respondent. 11 The applicants were suspended on full pay in mid-July 2001 pending completion of investigations and the employment relationship ultimately ended in mid-August 2001. In the investigative process, the applicants attempted without success to obtain particulars of the allegations against them and made complaints throughout the process about the vagueness of the allegations and the procedural unfairness attached to the investigative process. They also denied and continue to deny the allegations of misappropriation. The applicants also attempted without success to obtain information said by the respondent to have been supplied to the NSW police. 12 The applicants, again through their solicitor, freely and openly acknowledged using the "split" and "merge" functions in circumstances where they were required in the course of their duties to: · Change checks upon request or by error · Reverse an entry on the check because of dissatisfaction with the food · Reverse entries to correct drinks incorrectly ordered · Correct errors occurring during the process of teaching new staff · Follow patrons who move from one table to the other as often occurs · Provide customers with separate checks on demand · Rectify errors made by other waiters working at the same table 13 Whilst it is well settled on the authorities that an applicant must establish elements of unfairness such as to warrant the intervention of the Commission (see Western Suburbs District Ambulance Committee v Tipping [1957] AR (NSW) 273; Bigg v NSW Police Service (1998) 80 IR 434; Re Barrett v Crown Street Women's Hospital [1947] AR (NSW) 565; Re Homebush Abattoir [1966] AR (NSW) 371 and others), it is equally well settled that there is an onus resting squarely upon an employer relying on allegations of misconduct in justification of dismissal (see WD & HO Wills (Australia) Ltd v Jamieson [1957] AR (NSW) 547 at 552, 553; North v Television Corporation Ltd [1976] 11 ALR 599 at 602; Wallace v Deering Auto Electrics (1985) 12 IR 34 at 35; Pastrycooks Employees, Biscuit Makers Employees and Flour & Sugar Goods Workers Union v Gartrell White (No.3) (1990) 35 IR 70 at 83-84). 14 Further in Wang & Others v Crestell Industries Pty Ltd (1997) 73 IR 454 a Full Bench of the Commission said this: The employer must establish to the reasonable satisfaction of the Commission, that the employee was guilty of the misconduct alleged. The onus of proof in such a case is on the employer and the standard of proof must be such as to enable a positive finding that the misconduct occurred. The standard is of course, the civil and not the criminal one, but the requisite degree of satisfaction must have regard to the seriousness of the alleged conduct and the gravity of the consequences of the finding. The satisfaction must be such to warrant a positive finding of the type referred to by the High Court on M v M (1988) 63 ALJR 108 and by Dixon J in Brigginshaw v Brigginshaw (1938) 60 CLR 336 at 362. 15 In this case, and after careful consideration of the detailed evidence as well as the comprehensive submissions of opposing counsel, I am not so satisfied. 16 The fundamental weakness in the respondent's case as I am disposed, and it is to be remembered that the respondent was substantially moved to form the opinion it did as to misconduct on the part of the applicants by the conclusions of the technical expert Leonard Hill, is that the waiter and not the computer physically collects the cash from the customer. The computer then records what is paid in or required to be paid in at shift end in satisfaction of each check or the total of all checks. 17 What is not known or capable of being discovered from the computer record is the cash amount actually paid by the customer to the waiter/cashier. In my judgment and on the evidence as it stands, the bounds of probability cannot be extended to the prerequisite standard in this case to conclude, save as to tips or gratuities, that the applicants actually collected more money from restaurant patrons than they paid in at the end of each shift, and although such misconduct is clearly a possibility, it is not as I am disposed, sufficiently probable. There are too many doubts. 18 I say that having due regard to the statutory declarations of Ms Sheen and Mr Emery which were attached to Ms Williamsons's statement of evidence. Ms Sheen and Mr Emery were acquaintances of Ms Williamson who were asked to dine at the restaurant and by prior arrangement, were seated at tables served by the applicants. They were told to pay in cash rather than by credit card and to ensure that the original "checks" presented to them for payment were kept in order that they could be compared with the computer record. I have little hesitation in saying, as indeed Mr McAvoy of counsel for the applicants vigorously submits, that the evidence of Ms Sheen and Mr Emery is of little probative value. The fact that neither were called, or in Mr Emery's case, made available for cross-examination allows an inference of the type referred to in Jones v Dunkel & another (1959) 101 CLR 298 at 312. 19 Furthermore, the generally unsatisfactory state of source material in the form of "checks" presented to Ms Sheen and Mr Emery or documents purporting to be such "checks", gives me no confidence at all that the respondent's forensic purpose in that regard has been achieved. Indeed, Ms Sheen it would seem forgot to pick up her "check" as she was asked to by the respondent. As Mr McAvoy rightly submits, the cases suggest that evidence of possession by the employee of the thing said to be stolen has been a recurrent and frequently necessary theme in discharging the burden of proving misconduct (see Wang v Crestell Industries Pty Limited (1997) 73 IR 454; Antonakopoulos v State Bank of New South Wales (1999) 91 IR 385; Australian Workers Union (WA) v W M C Resources Ltd (1998) 78 WAIG 1065; Coward v Gunns Veneer Proprietary Ltd FedCts(Tas) 0696/98; BC9802568; Linsen v Apollo Bay Supermarket (1997) 71 IR 339; Taggart v Bell Sports Australia [1999] NSWIRComm 408; Curro v Bell Sports Australia [1999] NSWIRComm 281; Kirilo Nikolovksi v BHP Integrated Steel [1999] NSWIRComm 282; Steven Watson and Blacktown City Council [1998] NSWIRComm 381; Kolhagen v Cargill Foods, Australia [1999] NSWIRComm 107). 20 In some cases stealing has been proved where it has been shown that some identified property of the employer is missing and the employee had access at the time it went missing. (see Zahra v Rooty Hill RSL Club Ltd [1998] NSWIRComm 187; Amin v Burswood Resort Management, Morley v Burswood Resort Management (1998) 78 WAIG 2441; Humphries v Cootamundra Ex-Services and Citizens Memorial Club Limited [2002] NSWIRComm 225). 21 In this case, it may again be observed that there is no, or no satisfactory evidence, of misappropriation when one looks for objective signs in that regard. There were no financial records or unexplained or systemic enrichment on the part of the applicants over and above income they earned. The amounts paid in by the applicants each night corresponded with the computer totals, and the proposition contended for by the respondent is, I am bound to say more speculative than factual when one looks at the totality of the evidence. At its highest, the respondent may have established that the "split" and "merge" functions were not used by the applicants strictly as they were intended, but I am prepared to accept for the purpose of these deliberations, that the applicants made use of those functions in the frenetic environment of a busy restaurant as a way, perhaps their way, of most expeditiously dealing with errors in food orders or customer dissatisfaction and the like and not with the intention of misappropriating or stealing money from the respondent. 22 In fact, as Ms Williamson candidly conceded during cross examination, absent the suspicion of misappropriation or fraud against the company, the incorrect use or misuse by the applicants of the "split" and "merge" computer functions would have been a counselling matter rather than a dismissal matter. As to that, I should not be taken to have concluded that the applicants actually misused the "split" and "merge" functions to any significant degree of culpability. The evidence as to instruction given to them in that regard was to say the least, equivocal. Mr Little for example, initially expressed the view that the applicants' use of the "split" and "merge" functions was entirely against the respondent's instructions, then changed his evidence at hearing to say that they were discouraged from using the functions. The applicants denied this and I think on balance, that it would be unsafe to conclude otherwise on the evidence as it stands. 23 Overall, the approach taken by the respondent to the litigation of the matter has something of a quicksilver character to it. On the one hand, there is an absence throughout the lengthy investigation of the matter leading up to the dismissals, of adequate particularisation of allegations relied upon. This is notwithstanding numerous approaches by the applicants through their legal representatives. On the other hand, there is reliance on the principle in the South Australian case Bi-Lo Pty Ltd v Hooper (1992) 53 IR 224 to the effect that the respondent in some way is not required to prove the applicants guilt, only that it honestly and genuinely believed and had reasonable grounds for believing on the information available at the time that the applicants were guilty of the misconduct alleged. I have said already that I do not accept on balance that there were such reasonable grounds, but at all events and with every respect to the respondent, that is a submission which if accepted, would bring the Commission into conflict with its own principle in Wang's case above namely, that the employer must prove allegations such as apply here to a standard which enables a positive finding that the misconduct occurred. 24 It is not as I would understand it, that the employer alleging misconduct may simply form a belief, however earnestly, which renders it immune from intervention by the Commission in such matters and, to the extent that the decision of the Full Commission of the South Australian Industrial Relations Commission in Bi-Lo Pty Ltd v Hooper (1992) 53 IR 224 is relied upon as authority for that proposition, it is at odds with the more recent decision in Wang v Crestell and therefore not open to me to follow. 25 Having regard to the totality of the evidence and matters submitted, I am of the view and find accordingly that the applicants' dismissals were manifestly and substantively harsh, unreasonable and unjust. That being so, it is unnecessary to determine the question of procedural unfairness, although it may be quietly observed before leaving the matter that the applicants' allegations in that regard were not entirely lacking in substance as I am disposed. 26 The applicants do not seek reinstatement or re-employment and limit their claim to monetary compensation at the maximum prescribed for the purposes of s 89(5) of the Industrial Relations Act 1996 (the Act). Having regard to matters relevant to be taken into account for the purpose of assessing compensation, I consider the applicants' claims should be granted in full. 27 The respondent is ordered pursuant to s 89(5) of the Act to pay each applicant within 28 days of the date of this decision, an amount equivalent to the remuneration each received during the period 6 months immediately before being dismissed. 28 Mr McAvoy submits, in the event that either or both applicants are successful in their claim for relief that the applicants should have costs of the proceedings. Mr Cross submits that there is no material before the Commission which would allow such an order to be made against the respondent, such power being limited to the circumstances outlined in s 181(2) of the Act. I am inclined to agree and would add, when the matters are viewed in their totality, that the respondent's case was an arguable case where factual matters were, and remained throughout, in very close contest. I make no order as to costs. 29 The proceedings are concluded accordingly. 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.