Industrial Relations Commission of New South Wales CITATION: Lane v. St George Masonic Club [2005] NSWIRComm 1044 APPLICANT Susan Lane PARTIES: RESPONDENT St George Masonic Club FILE NUMBER(S): 2336 of 2004 CORAM: Connor C termination of employment - swearing - failure to bundy off - consumption of alcohol on duty - resignation - constructive dismissal CATCHWORDS: Industrial Relations Act 1996 LEGISLATION CITED: Allison v. Bega Valley Council (1995) 63 IR 68 Anonakopoulos v. State Bank of New South Wales (1999) 91 IR 385 Busways v. Johnson (1994) 55 IR 255 Health and Building Surveyors' Association of New South Wales v. Strathfield Municipal Council (1987) 25 IR 359 CASES CITED: Little v. Commissioner of Police (No.2) (2002) 112 IR 212 Michaelis Bayley Trading Company Case (1979) AR 392 Peters v. Jenolan Cave Reserve Trust (1998) 86 IR 162 HEARING DATES: 03/31/2005 DATE OF JUDGMENT: 04/22/2005 APPLICANT Thomas Murphy T A Murphy and Company Solicitors LEGAL REPRESENTATIVES: RESPONDENT Andrew Fernon Counsel DECISION: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: CONNOR C Friday, 22 April, 2005 Matter No IRC 2336 of 2004 Susan Lane and St George Masonic Club Application under S.84 of the Industrial Relations Act, 1996 DECISION [2005] NSWIRComm 1044 Preliminary 1 Pursuant to the provisions of Part 6, Unfair Dismissals, of Chapter 2, Employment [Ss.83 to 90] of the 1996 Industrial Relations Act, Mrs Susan Lane has lodged an application concerning the termination of her services as duty supervisor with the St George Masonic Club on Tuesday, 30 March, 2004. Mrs Lane had nearly five years of employment with the club. She resigned her employment but she did so in the light of complaints made concerning her, ie swearing and drinking alcohol whilst on duty. In her Part 6 application she had sought her reinstatement or, alternatively, monetary compensation in lieu thereof. The matter was allocated to me and it was the subject of a conference - a conciliation and directions hearing - before me on Wednesday, 2 June, 2004 and mentions on Wednesday, 30 June, 2004 and Wednesday, 14 July, 2004. 2 Conciliation failed to settle the matter. I programmed it for arbitration. That arbitration was to occur on Friday, 10 December, 2004. However, there has been some confusion over the programming of this matter which has unfortunately delayed it. On Thursday, 7 October, 2004 the solicitor representing Mrs Lane (Mr Murphy) wrote to me to inform me that the matter had been set down for hearing on a day that he had otherwise been committed. He informed me in that letter that: "...we have been advised by the respondent's solicitors that they are willing to have the matter set down in the New Year. We would be obliged if the matter could be listed sometime in February or beyond, noting we understand the Commissioner has few dates left available for this year..." But apparently both parties were, in fact, available for the hearing on Friday, 10 December, 2004. There had been a misunderstanding concerning the actual hearing date and the parties indicated their preparedness to proceed on that day. Unfortunately, acting on the assumption that the hearing would not go forward on that day, I allocated other matters, reducing the time for the hearing to a point which meant that the hearing would not conclude on that day. It did not therefore proceed. 3 On Friday, 3 December, 2004 Mr Murphy wrote again to me informing me that, with the consent of the solicitor representing the club, the matter may be adjourned to 2005. I understand that Mrs Lane and her husband had planned an overseas holiday which also delayed the matter proceeding. I set the matter down for a hearing on Thursday, 31 March, 2005. Mr Murphy represented Mrs Lane in the hearing, calling her to give evidence. Mr Fernon represented the club in the hearing. He called Mr Bill Watts, the secretary manager of the club, as a witness in the hearing. There is a disturbing conflict in the evidence of Mrs Lane and Mr Watts on which this case largely depends. That conflict centres around what was actually communicated between Mrs Lane and Mr Watts at a meeting they had on Tuesday, 30 March, 2005 from which Mrs Lane resigned. 4 Mrs Lane had primarily sought in her Part 6 application that she be reinstated to her former supervisory position in the club. That remains the primary remedy for an unfairly dismissed employee [Little v. Commissioner of Police (No.2) (2002) 112 IR 212 at p.243]. Mrs Lane has found alternative casual employment in bar duties but on a remuneration substantially lower than she had received whilst she worked in the club. She indicated in her evidence that she still sought her reinstatement in the club where she enjoyed working. Mr Watts does not believe that it would be feasible for her to return to work at the club. Nor do I. Ultimately, Mr Murphy accepted that to be the position and confined Mrs Lane's claim to monetary compensation alone. The Evidence 5 Mr Watts had received a complaint in a letter from a director of the club that Mrs Lane had been observed yelling and using offensive language in the club on Saturday, 27 March, 2004. He reported her as shouting at the top of her voice: "What the fuck do I have to do in this place." More accurately, Mrs Lane claimed that she said words to the following effect: "Why am I fucking doing this." Mrs Lane did not deny that allegation. She had obviously experienced some frustration during her shift that day because at the time of the incident which was reported she claimed that she was continuing to work beyond the end of her shift while other staff were presumably available to perform work that she was performing. She was speaking rhetorically to herself, asking herself why she was still working, but she was apparently speaking loud enough to be overheard by any patron of the club in the vicinity. 6 At the time trade at the club was brisk; there was renovation work at the club; there was no automatic teller machine, no hot water in the kitchen and the dishwasher in the kitchen was not working. As far as Mrs Lane was concerned, she was experiencing a bad day. Mrs Lane had made efforts to rectify the various problems that had arisen, unscrewing sheets of gyprock to attempt to see if there were any obvious electrical problems, telephoning other clubs in the region to determine if there were any problems that they were experiencing and contacting tradesmen. She was also informed that the supervisor to relieve her was running late because there were train delays. She had apparently been the only supervisor on duty for some time during her shift. But at the time that she had been observed by the director of the club she claimed that she was off duty. 7 Mrs Lane claimed that she had finished her shift and was sitting down in the bar area. She usually drinks bourbon and coke. She consumed two or three such drinks whilst she sat at a table in the bar. After she had completed her shift she claimed that it was her usual habit to continue to assist as required where she remained in the club beyond her shift, picking up glasses, for instance. She is observed on security video tape produced as evidence in this hearing performing work and returning to the table where she sits drinking. But she had not bundied off on that day at that time and the club has naturally concluded that she was still on duty. 8 It is established in a formal document that governs the term of employments at the club that: "...it is an offence warranting summary dismissal for an employee to consume alcohol whilst on duty..." That requirement was known by Mrs Lane. Employees are permitted to consume one alcoholic drink in their break but they may not present themselves for work intoxicated. 9 There appears to be a fairly relaxed atmosphere in the club and, on the basis of the evidence before me in this hearing, I conclude that there has been a somewhat casual approach to the bundy system in operation, at least amongst supervisory staff. Mrs Lane asserted in a written statement which formed the basis of her evidence that: "...whilst in the position of a bar person I was strictly in the habit of bundying on when I arrived to work, bundying off when I took breaks and on again when I resumed duties and again when I left. This practice was adopted by me and other bar staff almost invariably unless forgotten on the odd occasions. When I became a supervisor I found that the system of bundying became more cumbersome. This was primarily because of the fact that any break taken was almost invariably interrupted by staff enquiries and other incidents. The demarcation line between time off and working became blurred. At most times I found I was unable to complete eating meals during my break and the like. I would tend to take breaks during my shift as and when the opportunity arose. Apart from bundying on and off at the beginning and end of each working day, I fell into the habit of not bundying on or off during breaks in any given day in employment. I would believe this to be common practice with supervisors..." Mr Watts refuted that breaks by supervisors were interrupted as frequently as Mrs Lane asserted. 10 Mrs Lane claimed that her failure to bundy off was simply a mistake on her part. She has frequently made mistakes in bundying on and off and has made manual adjustments to her bundy card. She did not make any manual adjustment to her bundy card on this occasion, however, and I believe I am entitled to accept that fact as confirming that she remained on duty on this occasion. Consequently, she was in clear breach of an important condition of her employment and the possibility of her summary dismissal arose. 11 Mr Watts called her to a meeting on Tuesday, 30 March, 2004. He raised the allegation of her swearing in the club. He then raised the excessive time Mrs Lane allegedly took to take her breaks, viz: "I believe you take two or three hours for your breaks." Mrs Lane denied that allegation, claiming that she took no more than ten to fifteen minutes for her breaks. Mrs Lane claimed that Mr Watts accused her: "I have asked staff and they say you have a serious drinking problem." She shook her head. She claimed that she was taken aback by that allegation and did not respond to it. Mr Watt's allegedly replied: "I have too much on my plate to worry about this. I want you to resign." And Mr Watts handed Mrs Lane a pen and paper and instructed her: "Write it out now and make it effective today. I will pay you out as of today." Mrs Lane believed that she had no choice in the matter. She wrote a letter of resignation and left the premises. 12 Mr Watts emphatically denied that he made any comment concerning a "...drinking problem..." for Mrs Lane, nor that he indicated that he had "...too much on his plate to worry..." over her or that he wanted her to resign. It is Mr Watt's assertion that Mrs Lane volunteered her resignation - twice. Ultimately Mr Watts accepted Mrs Lane's resignation. According to Mr Watts, Mrs Lane volunteered to resign after he confronted her with the allegation that she had sworn in the club bar and the complaint from the club director over it. Mr Watts asked Mrs Lane: "Do you have a death wish?" And went on to indicate that she had been observed on security video tape drinking on duty. Mrs Lane claimed to Mr Watts, as she claims now in her evidence, that she was off duty but then confirmed her intention to resign, viz: "I'll resign then." At no time did Mr Watts suggest that Mrs Lane resign. That had been raised only by Mrs Lane. He nevertheless gave her a pen and paper to complete her resignation letter. Conclusion 13 Part 6 applications depend upon S.84(1) which applies only to cases where: "…an employer dismisses an employee and the employee claims the dismissal is harsh, unreasonable or unjust…" It is trite to say that a resignation is not a dismissal for the purposes of S.84(1). Nevertheless, in the Michaelis Bayley Trading Company Case (1979) AR 392 Macken J of the former State Industrial Commission did acknowledge the concept of constructive dismissal where an employee's purported resignation is tainted by duress. He commented (at p.393) as follows: "…Just as it is a fundamental requirement for an employment contract to be entered into by the genuine consent of both parties to the contract - a consent untainted by any hint of pressure or threat - so too, it must be terminated by a resignation equally untainted by such a threat. Where a contract is terminated otherwise, it amounts to constructive dismissal…" That type of approach has been consistently recognised in the State industrial jurisdiction [ Health and Building Surveyors' Association of New South Wales v. Strathfield Municipal Council (1987) 25 IR 359]. 14 Mr Murphy referred in his submissions to the decision of the Full Bench of the Commission (Peterson and Marks JJ and Connor CC) in Allison v. Bega Valley Council (1995) 63 IR 68. In particular, the Full Bench commented (at p.72) that: "…although the term 'constructive dismissal' is quite commonly used, it can deflect attention from the real inquiry. That inquiry should involve an analysis of what occurred. Did the employer behave in such a way so as to render the employer's conduct the real and effective initiator of the termination of the contract of employment and was this so, despite on the face of it, their employer appears to have given his or her resignation? …" Mr Murphy has suggested in his submissions procedural issues as justifying his claim that the termination of Mrs Lane's services from the club was unfair - "harsh", "unreasonable" or "unjust", to use the language of S.84(1) [ Busways v. Johnson (1994) 55 IR 255 at p.261]. He has relied to that extent on the reasoning of the Full Bench of the Commission (Wright J - President, Walton J - Vice President and Redman C) in Antonakopoulos v. State Bank of New South Wales (1999) 91 IR 385 at p.389. A constructive dismissal - forcing an employee to resign - would prima facie be unfair procedurally. As I indicated in Peters v. Jenolan Cave Reserve Trust (1998) 86 IR 162 at p.172: "…by its very nature, a finding that a resignation is a constructive dismissal leads almost inevitably to the conclusion that the constructive dismissal is unfair..." But the question remains whether there was any force actually applied to Mrs Lane by Mr Watts or whether she was simply exercising her undoubted right to resign. 15 It seems clear to me that there was a very real prospect that Mrs Lane faced dismissal. Whilst Mr Watts indicated that the purpose of the meeting he had with Mrs Lane on Tuesday, 30 March, 2005 was not to dismiss her, he conceded in his evidence that, in view of the seriousness of the allegations levelled against her, her dismissal was very likely to be the ultimate outcome. But did Mrs Lane jump the starter's gun? To use the approach developed by the Full Bench in Allison v. Bega Valley Council, was Mrs Lane's resignation no more than a reflection of Mr Watts' clear intention to terminate her services? I do not believe so. 16 Notwithstanding the claims made by Mrs Lane that it was Mr Watts who first raised the prospect of her resigning, I found Mr Watts' version of the conversation he had with Mrs Lane in the meeting on Tuesday, 30 March, 2004 to be more plausible than Mrs Lane's evidence. The fact remained that Mrs Lane admitted to having used offensive language in a loud voice in the bar area of the club, been overheard (by a club director no less) and a formal complaint to the club management had been made. She had been drinking in the club and, in view of the fact that she had not bundied off at the time (and did not subsequently manually adjust her time keeping records) it was open to the club, as it is open to me in this hearing, to conclude that she was still on duty. To drink alcohol at such times presented the club with grounds for her summary dismissal. It would be clearly logical for her to volunteer her resignation in those circumstances and for the club management to accept it. I believe that is what happened. Mrs Lane's resignation was influenced not by Mr Watts' conduct but her own. 17 Consequently, I am satisfied that Mrs Lane's Part 6 application is beyond jurisdiction under Part 6 and I see no grounds for my intervention in support of her. I dismiss her Part 6 application. P J CONNOR Commissioner 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.