Industrial Relations Commission of New South Wales CITATION: Department of Health v Perihan Kaplan [2010] NSWIRComm 65 PARTIES: Director-General of NSW Health Department, Health Support Services Division (Appellant) Perihan Kaplan (Respondent) FILE NUMBER(S): IRC 1838 of 2009 CORAM: Walton J Vice-President; Haylen J; Bishop C CATCHWORDS: APPEAL - unfair dismissal - five allegations of misconduct - three allegations substantiated - first and final warning issued to respondent - disciplinary meeting held - respondent's employment terminated after threat made against female employee - previous aggression towards same employee - finding first instance dismissal was harsh - parties heard as to the question of leave to appeal at outset - leave to appeal partially granted - leave was otherwise refused - question as to whether trial judge erred in finding dismissal was harsh unreasonable or unjust - meaning of the expression 'harsh' - mitigating factors - balance of personal and mitigating considerations against the gravity of misconduct - seriousness of threat understood - assessment as to whether the respondent was incapable of rational behaviour at the time of the meeting - failure of the appellant to place sufficient weight upon the mental state of the respondent - adequate reasons given for the decision that the termination was harsh - second part of the appeal - exercise of discretion under s 89 Industrial Relations Act 1996 - leave granted - serious and discrete errors of law in the exercise of powers under s 89(2) - failure to give adequate reasons as to why re-employment was preferred over reinstatement - a 'displaced person' may constitute former position for purposes s 89(1) - question as to whether it was impracticable to reinstate or reemploy was not adequately resolved against facts and circumstances of the matter - appeal upheld - question of appropriate orders to be made in disposition of the appeal - further oral submissions on appropriate orders to be made in appeal - stay of proceedings not dissolved LEGISLATION CITED: Industrial Relations Act (1996) Beahan v Bush Boake Allen Australia Pty Ltd (1999) 47 NSWLR 648 Bhattacharya v Director-General of the Department of Education of Training [2000] NSWCA 74 Bostik (Australia) Pty Ltd v Gorgevski (No 2) (1992) 36 FCR 439 Burge v NSW BHP Steel Pty Ltd (2001) 105 IR 325 Byrne v Australian Airlines Ltd (1995) 185 CLR 410 Casari v South West Area Health Service (2009) 185 IR 217 Commissioner of Police for NSW v Industrial Relations Commission of NSW & Raymond Sewell [2009] NSWCA 198 CASES CITED: Commissioner of Police v Sewell (2008) 108 IR 91 Director General, New South Wales Department of Health v Industrial Relations Commission of New South Wales [2010] NSWCA 47 EDC v Burnard (1990) 49 IR 446 Hollingsworth v Commissioner of Police (No2) (1999) 47 NSWLR 151 Little v Commissioner of Police (No 2) (2002) 112 IR 212 Metropolitan Meat Industry Board v Australasian Meat Industry Employees' Union, NSW Branch [1973] AR (NSW) 231 Port Macquarie Golf Club Ltd v Stead (1996) 64 IR 53 Re Loty & Holloway v Australian Workers' Union [1971] AR (NSW) 95 Russell v Trustees of the Roman Catholic Church for the Archdiocese of Sydney (2007) 69 NSWLR 198 HEARING DATES: 24 March 2010 DATE OF JUDGMENT: 28 May 2010 Mr P Newell of counsel (Appellant) Director-General of NSW Health Department, Health Services Division LEGAL REPRESENTATIVES: Mr R Reitano of counsel (Respondent) W.G. McNally Jones Staff JUDGMENT: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES FULL BENCH CORAM: WALTON J Vice-President HAYLEN J BISHOP C Friday 28 May 2010 Matter No IRC 1838 of 2009 DEPARTMENT OF HEALTH and PERIHAN KAPLAN Application by Director-General of NSW Health Department, Health Support Services Division for leave to appeal and appeal against the decision of Commissioner Ritchie given on 10 November 2009 in Matter No IRC 2333 of 2008 DECISION OF THE COMMISSION [2010] NSWIRComm 65 1 This matter concerns an application by the Director-General of NSW Health Department, Health Support Services Division, ("the appellant") for leave to appeal and, if granted, to appeal against a decision of Commissioner Ritchie, given on 10 November 2009, finding that the dismissal of Ms Perihan Kaplan ("the respondent") was "harsh" and ordering her re-employment as a displaced person with back pay under ss 89(2) and (3) of the Industrial Relations Act 1996 ("the Act"): Kaplan v Department of Health Support Service [2009] NSWIRComm 1088. 2 On 24 March 2010, at the outset of these proceedings, the Commission heard the parties as to the question of leave to appeal under s 188 of the Act. An extempore judgment was delivered on that day in which the Full Bench decided to partially grant leave to appeal. That decision was as follows: We have decided that we will approach the question of leave as follows: As to the first part of the submission developed by the appellant going to the question as to whether there was error in the decision at first instance in the decision that the termination was harsh, and I am here referring in relation to the merits of the appeal to in a broad sense to that area of the submissions advanced by the appellant in writing in paragraphs 20 to 42 respectively, we refuse leave to appeal. In relation to that aspect of the appeal, that is the second part of it as described by Mr Newall concerning the exercise of the powers under section 89 of the Act effectively concerning the balance of the written submissions on merit from paragraph 43 of the appellant's outline of submissions on appeal, we grant leave to appeal. That brings with it the prospect of further submissions on the merits of the appeal should we find error in relation to that aspect of the decision at first instance and that, of course involves related considerations of the kind last raised with Mr Reitano before we adjourned and we earlier raised with Mr Newell. 3 Our refusal to grant leave to appeal concerned the challenge brought to the Commissioner's finding that the dismissal was harsh. In this decision, we shall provide reasons for that conclusion. We shall also provide reasons for the grant of leave and determine the merits of the balance of the appeal concerning the application of s 89 of the Act. FACTUAL BACKGROUND 4 On 16 December 2009, the respondent filed an unfair dismissal application under s 84 of the Act in consequence of the termination of her employment from the Health Support Division, Linen Services Branch of the appellant located at Parramatta. 5 The circumstances preceding and the source of that termination may be briefly described. 6 The respondent commenced work at Lidcombe hospital in 1990, and in the intervening years worked in various areas of employment in the State health system on a part time, casual and full time basis. Ritchie C's unchallenged finding was that, other than an (immaterial) warning in February 2004, prior to October 2008 the respondent had an unblemished record. 7 In 2007, the respondent was appointed to the position of "Customer Service Supervisor". It was her responsibility to liaise with customers of the Parramatta Linen Service. However, a new structure was soon put in place which resulted in the respondent's current position being abolished and three new positions called "Customer Relations Co-ordinators" being established. In June 2008, she applied for one of those new positions but was unsuccessful. As a result of this, the respondent felt depressed and saw her general practitioner. 8 On 29 September 2008, the two successful applicants for the Customer Relations Co-ordinator position, Ms Kylie Summers and Mr Mark Zabel, were announced. The respondent was on annual leave when the appointments were made, however, at the time, she was advised by Mr John Wragg, Linen Resources Manager, that she would be interviewed for the outstanding vacant position on 9 October 2008. 9 On 10 October 2008, Mr Wragg, provided the respondent with a letter which outlined four allegations of misconduct against her. The details of the allegations are as follows: 1. That on Wednesday, 8 October 2008, you were abusive and aggressive towards Kylie Summers, Customer Relationship Coordinator accusing her of taking your job. 2. That on Friday, 10 October 2008, you made accusations towards Christian Komarek, Operations Manager for Parramatta Linen Servide (sic) accusing him of invading your privacy by telling others that you were going for an interview, and refusing to carry out work related tasks. 3. That on Friday, 10 October 2008, you took the car of Paul Deacon, NSW Linen Services Manager without seeking his approval first as per instructions outlined on car booking sheets. 4. That on Friday, 10 October 2008, you were requested by John Wragg to return to the office at Parramatta Linen Service to discuss the complaints surrounding 2 and 3 mentioned above, but you refused and hung up on him before he had time to elaborate. 10 On 14 October 2008, the respondent attended a meeting with Mr Wragg and Ms Agustin, Human Resources Manager for the Parramatta Linen Service, where she denied allegations one to three and admitted allegation four with an explanation. 11 On 24 November 2008, a report was prepared by Ms Noelene Salmon, Human Resources/Employee Relations State Manager for Health Support Services, called "Disciplinary Proceedings - Perihan Kaplan" which outlined a further five allegations as follows: 1. Aggressive behaviour towards Kylie Summers and accusing her of taking her job. 2. Making false accusations against Christian Komarek, Operations Manager Parramatta Linen Service, accusing him of invading Ms Kaplan's privacy and making threats about writing complaints about it. 3. Not following instructions by taking Paul Deacon's car (NSW Linen Manager) without approval. 4. On 3rd November 2008 Ms Kaplan followed Ms Summers out of the work car park and stopped her in the road and verbally abused her regarding Ms Summer's being appointed to a position for which Ms Kaplan was unsuccessful and taking her job. 5. On 5th November 2008 Ms Kaplan telephoned Ms Summers on her mobile telephone and was aggressive and abused her regarding Ms Summer's being appointed to a position for which Ms Kaplan was unsuccessful and taking her job. 12 The first, fourth and fifth allegation were found to be substantiated. The report recommended that the respondent be disciplined with a warning and, if any further incident occurred, the respondent's contract would be terminated. 13 In relation to the first allegation, the Commissioner stated at [113]: 113 The first allegation was that which occurred on 8 October between the applicant, Ms Summers and Zaba. In reviewing the evidence with respect to this matter it would seem that it was not the raising of her voice by the applicant but the questioning by the applicant as to Ms Summers competency to do the job that Ms Summers objected to. I note the evidence of Ms Teoman when she stated that a Turkish speaker with a restricted command of English, will sound abrupt and inappropriate and also the evidence of Ms Ibrahim who acknowledged that the applicant sometimes too much speaks her mind. The alleged comment made by the applicant to Ms Summers to the effect that "she took her job" would not have sat well with a new incoming person. Whilst the applicant may not have wished to project herself during this conversation in an off putting manner which resulted in Ms Summers being upset, the result on this occasion was that Ms Summers with Mr Zabel reported the matter to Mr Wragg. Notably it was the first time in her employment with the respondent that Ms Summers had reported a fellow employee. At this point the respondent failed to adhere to the "Framework For Managing The Disciplinary Process In NSW Health" in that neither Ms Summers or Mr Zabel were required to complete a statement detailing what was alleged by whom, how it was said and where it was said. Having not generated such documents which would have then been provided to the applicant so as she was aware at first instant as to what was being alleged, was unfair on the applicant. The subsequent interview of the applicant with respect to this allegation was based on brief notes that Mr Wragg had jotted down as a consequence of speaking to Ms Summers and Mr Zabel. It was also inappropriate for Mr Wragg to be involved in the interview of the applicant when he himself had raised an allegation that she had hung up on him during a phone conversation. Mr Wragg should not have had anything to do with the applicant with respect to the 8 October investigation. It was raised by the applicant that another employee by the name of John may have overheard the conversation yet no attempt was made by the respondent to investigate this aspect. The non-appearance by Mr Zaba in these proceedings, an obvious witness to the 8 October exchange, is somewhat perplexing. I do not accept Mr Easton's submission that his evidence would not have added anything more. On the contrary his evidence of what he saw and heard on that day would have been beneficial to the Commission. Whilst I note that this incident by itself would not have resulted in a termination of the applicant I do not believe I can make a positive finding that the applicant sought to be intentionally aggressive towards Ms Summers. 14 The Commissioner noted that the fourth allegation, concerning the incident on 3 November 2008, was a "more serious matter". He found the respondent followed Ms Summers in her car out of the car park, pulled up alongside her and "yelled" the following words: Why did you complain about me? Why are you doing this? Pull up so we can talk about it. 15 The respondent categorically denied this exchange took place. Nevertheless, the Commissioner preferred the evidence of Ms Summers, and found that the incident on 3 November 2008 did take place as alleged. 16 As to the final allegation, the Commissioner found that on 5 November 2008, phone records indicated that the respondent contacted Ms Summers on two separate occasions. He found at [115]: In summary it is my finding that I prefer the evidence of Ms Summers with respect to this issue. It is my view that the applicant during this period was in an agitated state, brought on in my view by Ms Summers reporting their 8 October meeting, and the subsequent action that occurred. In my view the applicant did indeed loose her temper and in doing so made the comments to Ms Summers about her car, where she lived and what school her children attended. Such comments are clearly inappropriate and unacceptable. I accept the submission of Mr Easton that a subsequent text message by the applicant to Mr Swarmy complaining about the actions of Ms Summers indicated a presence of mind and that what she had just done may land her in more trouble, and so she told a new story that she was being set up. I do not know what benefit Ms Summers would derive if that was true. 17 Commissioner Ritchie considered that the appropriate disciplinary action for the allegations which had been made out was for the respondent to receive a "first and final warning". 18 On 1 December 2008, a meeting was held between Mr Adam Hall, Mr Swarmy, Ms Agustin, Ms Salmon and the respondent to discuss the allegations found in this respect and the offer of voluntary redundancy as a displaced person. The Commissioner observed that both parties had a "desire for the meeting to go ahead". He stated at [116]: ....The applicant wanted the issues that she had been living with for several weeks to be finished with and the opportunity to consider a voluntary redundancy. The respondent by having the meeting would conclude the disciplinary process in an abridged fashion and then offer the applicant voluntary redundancy. In (the) days leading up to the meeting taking place the applicant had sought assurances from both Mr Hall and Ms Salmon as to what would be discussed and her concern about her ability to handle such a meeting. The applicant on the morning of the meeting went to her GP but made no mention of the forthcoming meeting. In my view this was done intentionally so as she could attend the meeting. On the day of the meeting the applicant met with Mr Hall. It was Mr Hall's view that this would give him the opportunity to appraise the applicant's demeanour and if necessary halt the meeting. In his view he determined that the meeting should go ahead as he believed he had the capability to control his member. Whilst Ms Salmon had outlined to the applicant over the phone as to what was to take place including the outcome of the allegations, and the approval received to be able to offer voluntary redundancy she did not detail to the applicant exactly which of the allegations that had been substantiated. The applicant therefore went into the meeting without that knowledge. As a consequence the applicant was not prepared for the findings that was expressed to her. She had in her mind one thing but was told another. This lack of knowledge on behalf of the applicant contributed to the meeting's failure. Also the applicant was shown CCTV photos of the car-park taken on 3 November 2008. Introducing such evidence at such a stage I believe was contrary to the disciplinary guidelines and was rightly challenged by Mr Hall. Such an action by the respondent again did not help the process. Notwithstanding the best intentions of representatives of both parties to try and adhere to what was on the agenda that day, it is clear that the applicant was not in a fit state to participate in a normal business like manner. I am satisfied that the applicant due to her fragile state lost control of herself and I find that she uttered the words as expressed by all the other witnesses in the room who gave evidence in this hearing. What she said shocked the people in the room resulting in Ms Summers being warned of the threat, reporting the incident to the Police and the Union no longer acting for her. The respondent then proceeded to withdraw the option of voluntary redundancy and the internal process of terminating an employee commenced. I believe that at that point after the meeting a general time out should have taken place. During the meeting the failure to follow the disciplinary procedures by the respondent had been raised and there had been put in place a process of providing the applicant with a copy of the written finding and other material and a time for the applicant to consider same and respond. This plus the opportunity for the applicant to respond to her outburst at the 1 December meeting should have taken place. I note that the email sent by the applicant to Mr Hall on 5 December starts with the sentence " Sorry about the other day" and includes "I lost it". Such a review of whatever the applicant came back with should then have been handled by a person who had not been previously involved with the applicant in the disciplinary process. 19 The words found by Commissioner Ritchie to have been uttered by the respondent were: I have seven brothers and my husband has seven brothers and many cousins and after court I will show Kylie what aggression is and she will be dead. 20 The respondent's position was not terminated at this meeting. On 3 December 2008, Ms Salmon compiled a "Briefing for the Chief Executive - Termination of Perihan Kaplan". On 5 December 2008, Mr John Roach, Chief Executive of the Health Support Service, notified the respondent in writing of her termination. The respondent's termination took effect from 8 December 2008. The reasons given for her dismissal were: 1. The first discipline (sic) of a warning that further similar behaviour would warrant termination is endorsed. 2. The second act of aggression warrants termination linked to the first discipline, however the threat of death to another employee is an extremely serious matter and when this is linked to other aggression to that employee and a history of similar behaviour warrants summary dismissal. CONCLUSIONS AT FIRST INSTANCE 21 The Commissioner found that the dismissal of the respondent was harsh as it was "disproportionate to the gravity of the misconduct" taking into consideration the mental state of the respondent at the time. 22 He stated (at [118-119]): 118 Whilst I have made a positive finding that the applicant did threaten Ms Summers during the meeting I do not believe the applicant was in a mentally fit state to handle such a meeting and therefore had a diminished responsibility for what she expressed during such a meeting. The medical certificate issued on the morning of the meeting had the diagnosis as: "anxiety, depression, panic attacks." The applicant at the time of that meeting was facing a number of issues and was not I believe capable of rational behaviour and thought to the extent required. In my view mitigating circumstances did exist in this instant. The failure of the respondent to allow the applicant the opportunity to explain herself post the 1 December 2008 meeting was a clear failure of procedural fairness. 119 In summary it is my finding that the termination of the applicant was harsh as it was disproportionate to the gravity of the misconduct taking into consideration the mental health of the applicant. 23 At [120]- [123] Commissioner Ritchie found: 120 The applicant seeks reinstatement or reemployment as a displaced person with no requirement that she be located at PLS. Her claim also seeks back pay for the period that she was terminated plus continuity. Mr Reitano for the applicant recognised that the hearing had been delayed by application of the applicant as a consequence of ill health and that would have to be dealt with in respect to back pay. Also medical evidence would have to be provided by the applicant during the period since termination in consideration of the back pay quantum, and if there was any workers compensation involved plus a medical clearance to return to work. 121 The respondent did not believe reinstatement was practical as a consequence of what the applicant actually did that would sever any possible future employment relationship and a number of witnesses stated that they would not wish to work with the applicant. 122 It is my view that the respondent is a large organisation with a number of outlets that the applicant could be considered for as a displaced person in accordance with the Managing Displaced Staff of the NSW Health Service Policy. Such consideration should take into account that the applicant has little or no contact with Ms Summers. 123 The applicant had a long history of employment with the respondent. Other than a warning in February 2004 the applicant prior to October 2008 had a blemish free work history. The failure of her applications for the Customer Relationship Co-ordinator positions was in my view not accepted by the applicant with good grace and a catalyst for what next occurred. This was a failure on the part of the applicant to recognise that there are very few certainties in the promotion process. 24 The Commissioner made the following orders (at [124]): 1. In accordance with section 89(2) of the Act, I Order the Director General of NSW Health Department Health Services Division Linen Services Parramatta Branch to reemploy Ms Perihan Kaplan as a displaced person within 21 days of the date of this Decision. Ms Kaplan is required to provide a medical certificate clearing her to return to work. 2. In accordance with section 89(3) of the Act, I direct the parties to confer and quantify the back pay taking into consideration the delay in the hearing of this case and any other relevant matters including if appropriate what is expressed in point 119 of this Decision. Such payment must be made to the applicant within 21 days of this Decision. I give leave to have this matter relisted at short notice if agreement is not reached. 3. In accordance with section 89(4) of the Act, I Order that the period of employment of the applicant with the respondent is taken not to have been broken by the dismissal. 4. I Order that Ms Kaplan be given a first and final warning with respect to the incidents of 3 and 5 November 2008. THE FINDING OF HARSHNESS 25 The appellant sought leave to appeal upon the basis of certain errors which were said to attend upon a finding by Ritchie C that the dismissal of the respondent was harsh. That finding was made pursuant to s 84(1) of the Act and involved mixed questions of fact and law: Burge v NSW BHP Steel Pty Ltd (2001) 105 IR 325 at [4] ('Burge') (also applying Hollingsworth v Commissioner of Police (No 2) (1999) 47 NSWLR 151 at [181 - 182] and Port Macquarie Golf Club Ltd v Stead (1996) 64 IR 53 at [59]. 26 One ground relied upon for this challenge was predicated upon a legal proposition that a dismissal which was based upon conduct by an employee, which constituted a breach of a fundamental and essential term of the contract of employment, "would necessarily not be harsh". No authority was given in support of that proposition except for an authority which was said to demonstrate that, in the contemporary common law of employment, an implied term may be found in every employment contract that the employee owes the employer a duty not to act in a manner likely to destroy or seriously damage the relationship of trust and confidence between them: Russell v Trustees of the Roman Catholic Church for the Archdiocese of Sydney (2007) 69 NSWLR 198. The appellant's contention would appear to be that a finding of harshness under s 84(1) could not be made in circumstances where an employee had been lawfully dismissed for breach of such a term. It was also suggested that that approach was mandated because the employee's conduct in that context would be a repudiation of the contract. 27 The difficulty with this approach, as opposed to one which would have the nature of an employee's misconduct weighed against mitigating factors to determine, inter alia, whether a dismissal was harsh, is that it stands in the face of the statutory scheme which requires the Commission to consider whether the dismissal was harsh, unreasonable or unjust. There is a long established authority in this Commission and its predecessors, extending at least from the decision of Sheldon J in Re Loty & Holloway v Australian Workers' Union [1971] AR (NSW) 95 at [99] ('Loty'), that the exercise of the Commission's powers in relation to unfair dismissals (now found in Part 6 of Ch 2 of the Act) requires a determination as to whether a dismissal was harsh, unreasonable or unjust, even though "it was perfectly legal" (Loty at 99). In Beahan v Bush Boake Allen Australia Pty Ltd (1999) 47 NSWLR 648 at [26], a Full Bench identified that "as Loty makes clear, the power of the Commission to order reinstatement or the other remedies in the case of an unfair dismissal is exercised regardless of the legal right of an employer to dismiss an employee". To similar effect, a Full Bench in Little v Commissioner of Police (No 2) (2002) 112 IR 212 at [71] ('Little') stated: The mere conclusion that a dismissal has been effected in accordance with common law or statutory requirements, or has adequate "justification" in the sense of there being proper grounds given for dismissal, does not remove from account in such proceedings a consideration of the severity of punishment and mitigating circumstances where those matters properly arise for consideration upon the material before the Commission. No different approach is to be applied in review proceedings under the Police Service Act. 28 This conclusion must also follow from the very meaning of the concept of "harshness" within s 84(1). The words "harsh, unreasonable or unjust" in s 84(1) are "ordinary non-technical words which are intended to apply to an infinite variety of situations where employment is terminated": Byrne v Australian Airlines Ltd (1995) 185 CLR 410 at [467] ("Byrne"), per McHugh and Gummow JJ, (applying Bostik (Australia) Pty Ltd v Gorgevski (No 2) (1992) 36 FCR 439 at [28]). The appellant's acceptance that the expression 'harsh' would bear the meaning "disproportionate to the gravity of the misconduct" (see Byrne at [465]), necessarily brings with it the conclusion that a breach of an employment contract or even a repudiation of it will not be determinative of a finding under s 84(1) of the Act as to whether the dismissal was harsh. So, too, does an acceptance (see Byrne at 465) that the personal circumstances of a dismissed employee may be also brought into account. 29 We would add to the discussion of the meaning of the expression 'harsh' (for the purposes of s 84(1)), our agreement with the Full Bench in Little [at 70] that, in order to illuminate the meaning of the concept of "harshness" it is unnecessary to go beyond the statement of Watson J in Metropolitan Meat Industry Board v Australasian Meat Industry Employees' Union, NSW Branch [1973] AR (NSW) 231 at [233] where his Honour stated as follows: In some cases, the issue of unfairness has been resolved because of the way in which the employer has exercised his right to dismiss or because of the absence of adequate justification for dismissal. But even if there are grounds for terminating the contract of employment, it is still open to the tribunal to examine the severity or otherwise of the step of dismissal. The Commission, commissioners and committees have so acted in the past and have intervened to order reinstatement where because of mitigating circumstances or past good conduct, termination has been shown to be too harsh a consequence. 30 We do not consider that the appellant established that Ritchie C departed from these principles or made a determination of "harshness", which was not properly available to him in the circumstances of this matter. 31 The Commissioner was entitled, on the evidence, to reach the conclusion that the respondent was "not in a mentally fit state to handle (the meeting of 1 December 2008) and, therefore, had a diminished responsibility for what she expressed during such a meeting". That conclusion was available on the medical evidence and the evidence otherwise available as to the respondent's state of mind in the weeks immediately preceding and at the meeting of 1 December 2008. It was also available to the Commissioner to take into account that the two incidents of inappropriate behaviour on 3 and 5 November 2008 by the respondent and the behaviour of the respondent on 1 December at the meeting convened by the appellant's officers, as he apparently did, represented conduct which was, to some extent, unusual or aberrant, having regard to the respondent's lengthy and incident free employment record prior to October 2008. These were mitigating circumstances which were required to be considered by the Commissioner. 32 In concluding whether the dismissal was harsh, the Commissioner had to balance these personal and mitigating considerations against the gravity of the misconduct. The Commissioner plainly undertook that task and properly had regard, in our view, to all relevant factors. 33 We consider that the Commissioner understood the seriousness of threats of harm being made by one employee to another and, in particular, the significance of an apparent threat to kill. In this respect, the principle stated in Bhattacharya v Director-General of the Department of Education of Training [2000] NSWCA 74 at [23] may be accepted but does not add greatly to the disposition of the appeal. The question the Commissioner had to answer was what was the gravity of that conduct, on the evidence before him at the hearing of the s 84 application. In that respect, the Commissioner was required to, as he did, make an assessment as to whether the respondent was incapable of rational behaviour at the time of the meeting, and to the extent that she was not, to take that into account in diminishing the severity of the conduct. It should be remembered that, absent the incident which occurred at that meeting, the employee would not have been summarily dismissed, although warnings had been issued and voluntary redundancy was under consideration. 34 We agree with the submission made by Mr R Reitano of counsel, for the respondent, that the character of the threat must be also judged against the fact that it was made at a meeting where the respondent was gravely distressed and where the person to whom the threat was apparently levelled was not present. In this respect as well, the Commissioner was entitled to have regard to the failure of the appellant to allow the respondent an opportunity to explain herself after the meeting of 1 December 2008, as a factor going to the harshness to the dismissal, albeit as a consideration of a procedural kind. 35 This approach does not involve, as the appellant submitted, a conclusion that the threat "warranted no sanction whatsoever", but that, upon proper investigation and assessment, the conduct was so diminished by the respondent's state that no further step was required other than the acknowledgement of the final warning which had been issued because of prior misconduct engaged in on 3 and 5 November 2008. Likewise, the Commissioner's decision did not ignore the basis upon which the decision by the appellant was made but, rather, had regard to the failure of the appellant to place sufficient weight upon the mental state of the respondent in reaching the conclusion that it did in all of the circumstances. 36 That leaves two aspects of the appellant's submissions, in this respect, for consideration. The first one may be dispensed with briefly. Having regard to our discussion of the Commissioner's decision, it is plain that we do not consider that he failed to give reasons or any adequate reasons for his decision that the termination was harsh. 37 The second issue involved a contention that the Commissioner erred in failing to place sufficient weight upon the fact that the respondent had "told the employer untruths". This contention was based upon various findings by Ritchie C, made contrary to the respondent's account of incidents which occurred on 3 and 5 November 2008. 38 There are two factors telling against this contention. The first is that we consider Ritchie C did, as the appellant recognised, have regard to these considerations in his factual determinations in the proceedings. 39 Secondly, we do not consider that the conclusions reached by the Commissioner should be properly characterised as conclusions that the appellant lied, fabricated statements or told direct untruths either to the employer or in her evidence before the Commission but, rather, that he preferred the account of other witnesses over that of the respondent in certain respects. That distinction, which was recognised by a Full Bench as being relevant to the question of the integrity of an employee, and assessments of the harshness (albeit in a different context) in Commissioner of Police v Sewell (2008) 108 IR 91 at [19-20] weighs heavily against the appellant's contention in this respect. In any event, the question of the respondent's integrity, in this respect, is but one factor which required assessment in determining whether her dismissal was harsh, unreasonable or unjust: Commissioner of Police for NSW v Industrial Relations Commission of NSW & Raymond Sewell [2009] NSWCA 198 at [75], and we consider Ritchie C took that matter properly into account. EXERCISE OF DISCRETION UNDER SECTION 89 40 The appellant contended that 'serious and discrete' errors of law were made by Ritchie C in the exercise of his powers under s 89(2) of the Act. Multifarious contentions were advanced in support of that proposition, some of which we consider warrant the affirmation of that ground of appeal. 41 First, the Commissioner did not give any reason as to why he did not order the reinstatement of the respondent pursuant to s 89(1) of the Act. The Commissioner apparently found that the restoration of the employment relationship was not impracticable (given the orders he made under s 89(2)), but did not order reinstatement which was the primary remedy under s 89: Burge at [34]; Little at [88] and Casari v South West Area Health Service (2009) 185 IR 217 at [72] ('Casari'). As was recently stated in Casari at [72] "it is only where it is impracticable to reinstate an applicant that the other remedies available under s 89 of the Act may be applied". The failure to give adequate reasons as to why re-employment was chosen over reinstatement also constituted an error of law: EDC v Burnard (1990) 49 IR 446 at [453]. 42 Secondly, the Commissioner made a determination that the respondent be reemployed as a "displaced person". Mr Reitano submitted that the Commissioner selected this remedy in preference to reinstatement because the position the respondent occupied no longer existed as the respondent was a displaced person. It appears, however, that the former position occupied by the respondent was, in fact, that of a displaced person and that, in the result, the powers under s 89(2) were not available: Director General, New South Wales Department of Health v Industrial Relations Commission of New South Wales [2010] NSWCA 47 at [19]. 43 Thirdly, whilst the Commissioner was entitled, as he did, to have regard to the nature and size of the appellant in assessing the practicality of re-engaging the respondent in an employment relationship (particularly when she was a displaced person), the Commissioner did not adequately resolve the question as to whether it was, in fact, impracticable to reinstate or reemploy the respondent because he failed to have particular regard to the circumstances leading to her termination including the events which the Commissioner found to have occurred in November 2008. The Commissioner may have properly taken into account, in this respect, the mitigating circumstances he had earlier found in favour of the respondent, but this required, as the appellant correctly submitted, a fresh assessment based upon the particular questions raised for consideration under s 89(1) and s 89(2) of the Act. This did not occur. 44 We consider that leave to appeal should be granted to correct these errors for the purposes of establishing principles for the proper administration of this aspect of the Commission's jurisdiction. The errors of law are of such a nature that the appeal must be upheld. ORDERS 45 These conclusions give rise to the question as to what orders should be properly made in the disposition of the appeal. 46 Having regard to the lengthy history of the proceedings, the continuance of orders requiring payment of wages to the respondent until the disposition of the appeal and the relatively complete state of the evidence as to the question of "impracticability", we have decided not to remit the matter and will determine, for ourselves, (as the parties accepted might be open) the appropriate orders to be made in disposition of the appeal. 47 Bearing in mind that there remains unresolved before us the question of the receipt of fresh evidence which potentially goes to the question of the appropriate orders to be made in disposition of the appeal (vis a vis any orders that might be appropriate to be made under s 89 of the Act) and, given the appellant's alternative submission as to remedy in paragraph [81] of its written submissions filed on 5 February 2010 (about which submissions are relatively undeveloped), we consider that the appropriate course is to receive further short oral submissions as to the appropriate orders to be made in light of this decision. Those submissions would be necessarily supplementary to the written and oral submissions we have already received and may address the full range of potential orders under s 89, as well as encompassing any further submissions as to the receipt of evidence. The earlier orders made in relation to the stay of the proceedings will stand. 48 We fix the matter for further hearing on this basis at 10 a.m. Tuesday 8 June 2010 and shall allow one hour for the taking of submissions. The matter stands adjourned 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.