Zopf v Industrial Relations Secretary on behalf of the Department of Customer Service [2020] NSWIRComm 1012
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Industrial Relations Commission
New South Wales
Medium Neutral Citation: Zopf v Industrial Relations Secretary on behalf of the Department of Customer Service [2020] NSWIRComm 1012
Hearing dates: 2 December 2019
Date of orders: 28 February 2020
Decision date: 28 February 2020
Jurisdiction: Industrial Relations Commission
Before: Commissioner Stanton, Commissioner Murphy and Commissioner Webster
Decision: (1) In the Application for Leave to Appeal and Appeal by Roland Zopf leave to appeal is refused.
(2) In the Application for Leave to Cross-Appeal and Appeal by the Industrial Relations Secretary on behalf of the Department of Customer Service leave to cross-appeal is granted and the cross-appeal is dismissed.
Catchwords: APPEAL – leave to appeal – principles to apply –whether appeal raises substantial issues of principle or law, or issues having any wider application than to the parties themselves – appeal against finding that reinstatement/re-employment was impracticable – Commissioner's findings reasonably open on the evidence - no demonstrable error disclosed – no substantial issue of principle or law having wider implications or widespread practical application – appeal against amount of compensation ordered – exercise of discretion – leave to appeal refused
CROSS-APPEAL – statutory framework for dealing with misconduct in the public service – threat of dismissal – resignation – constructive dismissal – leave to cross-appeal granted – cross-appeal dismissed
Legislation Cited: Bankruptcy Act 1924-1933 (Cth)
Fair Work Act 2009 (Cth)
Government Sector Employment Act 2013 (NSW)
Police Act 1990 (NSW)
Supreme Court Act 1970 (NSW)
Industrial Relations Act 1996 (NSW)
Industrial Relations Act 1991(NSW)
Cases Cited: Allison v Bega Valley Council [1995] 63 IR 68
Antonakopoulos v State Bank of New South Wales [1999] IR 385
Big W Discount Stores v Donato [1995] 58 IR 239
Bond and Director General of Education and Training [2010] NSWIRComm 178
Commissioner of Police v Eaton [2013] 252 CLR 1
Denis James Dominguez and Department of Finance, Service and Innovation [2017] NSWIRComm 1053) Denis James Dominguez v Industrial Relations Secretary (No.2) [2019] NSWIRComm 1003)
Health Secretary in respect of Western NSW Local Health District v Health Services Union NSW [2019] NSWIRComm 1086
House v The King [1936] 55 CLR 499
John Holland Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union [2009] 180 IR 314
Knowles v Anglican Church Property Trust (No 2) (1999) 95 IR 380
Mace v Murray (1955) 92 CLR 370
Mikhail Karem-Al Fidawy v The Sydney Opera House Trust [2017] NSWIRComm 1077
NSW Commissioner of Police v Cottle [2019] NSWSC 1588
R v Royal Alfred College [1979] 46 SAIR 598
Re Michaelis Bayley Trading Co and New South Wales Sales Representatives and Commercial Travellers' Guild Re Dismissal [1979] AR 392
Samantha Hudson v Transport for NSW [2019] FWC 390
Perkins v Grace Worldwide (Aust) Pty Ltd [1997] 72 IR 186
Zopf v Industrial Relations Secretary on behalf of the Department of Finance, Services and Innovation [2019] NSWIRComm 1046
Category: Principal judgment
Parties: Roland Zopf (Appellant; Respondent on the cross-appeal)
Industrial Relations Secretary on behalf of the Department of Customer Service (Respondent; Appellant on the cross-appeal)
Representation: Counsel:
Mr D Nagle (Appellant)
Mr M Seck with Ms B Byrnes (Respondent)
Solicitors:
McNally Jones Staff (Appellant)
Norton Rose Fulbright (Respondent)
File Number(s): 2019/00243406
Decision under appeal Court or tribunal: Industrial Relations Commission of New South Wales
Jurisdiction: Industrial Relations Commission
Citation: [2019] NSWIRComm 1046
Date of Decision: 17 July 2019
Before: Commissioner Constant
File Number(s): 2018/00213585
DECISION
1. Before the Commission is an Application for Leave to Appeal and Appeal by Roland Zopf against the decision of Commissioner Constant of 17 July 2019 in which the Commissioner determined Mr Zopf's unfair dismissal application by making an order that the Industrial Relations Secretary on behalf of the Department of Customer Service, formerly the Department of Finance, Services and Innovation ("Department"), pay Mr Zopf a sum equivalent to 12 weeks' pay (Zopf v Industrial Relations Secretary on behalf of the Department of Finance, Services and Innovation [2019] NSWIRComm 1046 – "Decision"). In the proceedings before Commissioner Constant, and on appeal, Mr Zopf has sought reinstatement to his former role of Senior Spatial Technician, Grade 5/6, with the Department.
2. The thrust of the appeal is that the Commissioner, having found that the dismissal of Mr Zopf was harsh (at [197]), erred in finding that reinstatement would have been impracticable (at [218]).
3. Also before the Commission is an Application for Leave to Cross-Appeal and Appeal by the Department. For ease of reference, in these reasons for decision we will refer to Mr Zopf as the appellant and to the Department as the respondent.
4. The matters which are the subject of the respondent's cross-appeal, are:
1. the Commissioner's finding at [94] of the Decision that the Commission had jurisdiction to entertain the application on the ground that the Cross-Respondent's resignation in response to the Cross-appellant taking a statutory action to give the Cross-Respondent an opportunity to resign pursuant to s 69(4)(b) of the Government Sector Employment Act 2013 (NSW) (GSE Act) constituted a 'dismissal' within the meaning of s 83(5) for the purpose of s 84(1) of the IR Act;
2. the Commissioner's finding at [105] of the Decision that, as a matter of fact, the Cross-Respondent's resignation from his employment with the Cross-Appellant was not given freely such that he was the real and effective initiator of the termination of employment; and
(3) the Commissioner's order at [228] of the Decision.
Background
1. The factual background to the proceedings is set out at [14]-[45] of the Decision and we do not propose to rehearse all of it here.
2. The Commissioner noted that the appellant commenced employment with the Central Mapping Authority, a predecessor of the respondent, in Bathurst on 23 February 1987 (at [14]).
3. At the time of the termination of his employment, the appellant was a member of the Imagery & Smart State Programs team. Brenton Ray was the Supervisor of that team (at [17]).
4. In her decision, the Commissioner recorded a number of alleged incidents which occurred during the appellant's employment with the respondent. These included an allegation that, in 2009, the appellant threw his keyboard into the monitor of his computer for which he received a written warning (at [19]-[21]).
5. The Commissioner also recorded that the appellant had complained for many years about the management and supervision of the teams in which he worked, including about Mr Ray. In his 2017 Performance Review, which the appellant submitted to Mr Ray, he was dismissive in his responses to a number of sections of the document. For example, he responded to the question "What do you think of your development?" with "Load of crap" (at [23]).
6. On 17 August 2017, there was a meeting between the appellant, Mr Ray and Leanne Mills, Manager of the Environmental Spatial Program, about Key Performance Indicators ("KPIs") which Mr Ray had set for a particular program on which the appellant was working. It is common ground that the appellant lost his temper at this meeting (at [24]-[27]). The appellant later sent emails to Mr Ray and Ms Mills apologising for his behaviour at the meeting (at [29]).
7. Following this incident, on 31 August 2017, the appellant was placed on a Performance Improvement Plan ("PIP") and received a letter setting out two allegations against him (at [32]-[33]). The allegations were:
1. Unprofessional and aggressive behaviour in the workplace
On 17th August 2017 you verbally rebuked your team leader and manager in [a] meeting, and displayed physical acts of aggression towards the leaders.
2. Unauthorised modification of systems
On 17th August 2017 approximately 50 tiles were completed inappropriately directly after the meeting of allegation one, that resulted in the leaders requiring the system to be regressed to address the issue.
(collectively "the Allegations")
1. Subsequently, an investigation was commenced. The appellant was placed on special leave pending the outcome of the investigation. He was medically examined and was found to be fit to perform the inherent requirements of his position and to participate in an investigation (at [34]-[40]). On 12 April 2018, the appellant provided a detailed written response to the Allegations (at [40]).
2. Ultimately, Allegation 1 was found to be substantiated and the appellant was advised on 31 May 2018 of the decision to terminate his employment (after being given an opportunity to resign) pursuant to subsection 69(4) of the Government Sector Employment Act 2013 (NSW)("GSE Act") (at [44]).
3. By letter dated 6 June 2018, the appellant tendered his resignation effective from 12 June 2018 (at [45]). The letter of resignation was in the following terms:
It is with great reluctance and disappointment that I announce my resignation after 31 and a half years of dedicated service to the department with a wealth of experience in Topographic, Cadastral, Special Products, Imagery, and Lidar mapping services.
It is unfortunate that the department has become an unsafe place for staff to work safely in, with the bullying, harassment, intimidation, exclusion, and sexual harassment issues. It is also unfortunate that staff here do not have the support to report or solve these issues. Although there is a window dressing campaign addressing these issues, in reality it is not the case on the floor.
With disappointment I shall resign and try to find work with another organisation and continue my dedication in the mapping field.
It is intended that my last day of service to be Tuesday, 12th June 2018.
1. On 12 July 2018, the appellant filed an application pursuant to section 84 of the Industrial Relations Act 1996 (NSW) ("IR Act"), which application was ultimately heard and determined by Commissioner Constant in the decision which is the subject of this appeal.
Provisions of the IR Act governing appeals
1. Appeals, such as those presently before this Full Bench, are conducted in accordance with the provisions of Part 7 of Chapter 3 of the IR Act.
2. Relevantly, section 188 of the IR Act is in the following terms:
188 Appeals to Full Bench by leave only
(1) An appeal to a Full Bench of the Commission under this Part may be made only with the leave of the Full Bench.
(2) The Full Bench is to grant leave to appeal if, in its opinion, the matter is of such importance that, in the public interest, leave should be granted.
(3) The Full Bench may deal with an application for leave to appeal separately and without conducting a hearing into the merits of the appeal.
(4) This section does not apply to an appeal made by the Minister.
1. Section 191 of the IR Act is in the following terms:
191 Nature of appeal
(1) An appeal to a Full Bench of the Commission under this Part is not by way of a new hearing and is to be determined on the evidence and material adduced in relation to the decision appealed against.
(2) However, the Full Bench may, by leave, receive further evidence if it considers that special grounds exist or if the evidence concerns matters occurring after the decision appealed against.
(3) To avoid doubt, the Full Bench cannot merely substitute its decision on the matter, but must follow the principles applying to appeals from discretionary decisions, whether or not further evidence is received.
Note. The above section generally follows the decision of the Full Industrial Relations Commission in Big W Discount Stores v Donato (1995) 58 IR 239 as to the nature of an appeal. The appeals in respect of which the section applies include appeals in connection with awards, unfair dismissals, approvals of enterprise agreements, unfair contracts or contraventions of dispute orders.
1. Big W Discount Stores v Donato [1995] 58 IR 239 was decided pursuant to the provisions of the Industrial Relations Act 1991(NSW) ("the 1991 Act"). Section 382 of the 1991 Act was in the following terms, which are significantly different from the terms of sections 188 and 191 of the IR Act:
Appeal from decision of Commission
382 (1) If the Minister considers that the public interest is, or would be
likely to be, affected by a decision of the Commission (other than the Full
Commission), the Crown may, as prescribed by the rules of the Commission,
appeal to the Full Commission.
(2) From a decision of the Commission (other than the Full Commission) an
appeal lies, as prescribed by the rules of the Commission, to the Full Commission at the suit of:
(a) a party, or an industrial organisation, affected by the decision; or
(b) without affecting paragraph (a)—an association registered under Chapter 6, if the decision affects the association.
(3) An appeal does not lie under subsection (2) from a decision of the Commission:
(a) that was made by consent of the parties; and
(b) in respect of which the prescribed certificate is given.
(4) An appeal under this section is to be determined;
(a) on the evidence adduced in relation to the decision appealed against; and
(b) on any other evidence (whether or not fresh or new evidence) or information called for by the Full Commission.
(5) On an appeal under this section, the Full Commission may (in accordance with this Act):
(a) vary an award, order, ruling, contract determination or other decision in any way it thinks fit; or
(b) direct a member of the Commission to take further action under this Act to carry its decision of the appeal into effect; or
(c) direct that its decision on the appeal take effect as from any specified date after the lodging of the application.
1. By contrast, section 188 of the IR Act imposes the requirement that leave to appeal be granted before an appeal can be heard. Section 191 makes it clear that an appeal to a Full Bench of the Commission is not a new hearing but is to be directed to the correction of error in the decision under appeal.
2. Section 191 of the IR Act may also be contrasted with section 75A of the Supreme Court Act 1970 (NSW). Subsection 75A(5) provides that an appeal under that provision is to be by way of a rehearing, whereas section 191 of the IR Act makes it clear that an appeal under that provision is an appeal in the strict sense.
Legal principles to be applied
1. The legal principles governing the grant of leave to appeal were recently stated by a Full Bench of the Commission (Chief Commissioner Kite SC, Commissioner Constant, Commissioner Sloan) in Health Secretary in respect of Western NSW Local Health District v Health Services Union NSW [2019] NSWIRComm 1086, in the following terms (at [12]-[15]):
12 Under s 188 of the IR Act an appeal to a Full Bench of the Commission may be made only with the leave of the Full Bench. The Full Bench is to grant leave to appeal if, in its opinion, the matter is of such importance that, in the public interest, leave should be granted.
13 The principles in relation to the grant of leave to appeal a decision of the Commission were summarised in Public Service Association and Professional Officers Association Amalgamated Union of New South Wales v Roads and Maritime Services [2015] NSWIRComm 16. In that matter the Full Bench stated:
"10. It is well settled that an appeal under the IR Act is an appeal in the strict sense: see s 191 of the IR Act and King v State Bank of New South Wales (No 2) [2002] NSWIRComm 353; (2002) 126 IR 407. In such an appeal the appellate tribunal will only intervene to correct error: Aboud v State of New South Wales (Department of School Education) [1999] NSWIRComm 449; (1999) 92 IR 32. In the case of discretionary decisions it is not enough that the appellate tribunal would have come to a different view. It must be shown that the primary judge had failed to properly exercise the discretion committed to him: Mace v Murray [1955] HCA 2; (1955) 92 CLR 370 and House v The King [1936] HCA 40; (1936) 55 CLR 499. It is important to bear these principles in mind in approaching the question of leave to appeal.
11. The principles guiding the determination of leave were clearly set out in this often cited passage from Hosemans v Commissioner of Police (No 4) (2005) 150 IR 263:
[5] The law and practice governing leave to appeal is well settled and does not require restatement: see Knowles v Anglican Church Property Trust (No. 2) (1999) 95 IR 380. However, two principles warrant particular mention: first, leave will not be lightly or automatically granted (see King v State Bank of New South Wales (No 2) (2002) 126 IR 407 at [52]-[55] and Knowles at 381 - 382) and, subject to the requirements of s188(2) of the Act, will not, generally, be granted unless the appellant demonstrates that the appeal 'raises substantial issues of principle or law or has wider implications for the jurisprudence of this Commission, including whether the decision has widespread practical application' (see Knowles at 382) or raises issues going to the proper administration of justice. Secondly, leave will rarely be granted where an appeal primarily seeks to challenge findings of fact which are otherwise reasonably open on the evidence: Box Valley Pty Ltd v Price (2000) 97 IR 484; Austin v NF Importers Pty Limited [2005] NSWIRComm 353 at [5]."
14 In Industrial Relations Secretary v Wattie [2017] NSWIRComm 1007 the Full Bench stated at [12] and [13]:
"12. We note that the Full Bench in Antonakopoulos v State Bank of NSW (1999) 91 IR 385 also held…that an appeal bench should not substitute its own views as to a decision that was reasonably open at first instance. We endorse and apply that approach.
13. Lastly, we add, as the Full Bench said in Fire Brigade Employees' Union of NSW (o/b Challinor) v Fire and Rescue NSW [2016] NSWIRComm 1050, that it will rarely be appropriate to grant leave to appeal unless an appellant can mount at least an arguable case pointing to appellable error. This is by no means a new element of the Commission's jurisprudence; it has long been held that an appellate body in an appeal of this nature will only substitute its own judgment where the first-instance decision maker has fallen into error of law, or made a finding of relevant determinative fact that is demonstrably wrong: Drake Personnel Ltd v Workcover Authority of NSW (1999) 90 IR 432 at 440. There will rarely be utility in granting leave to appeal where that degree of error cannot at least arguably be agitated on appeal."
15 The principles outlined in the cases cited above have since been approved in numerous decisions of the Full Bench. It is not necessary to list them all. We will apply these principles.
1. The Commission has historically accorded primacy to first instance decisions of its members.
2. In Donato a Full Bench of the Commission (Fisher P, Cullen J, Shiels CC), sitting on an appeal from a decision of Conciliation Commissioner McKenna in which she ordered the reinstatement a dismissed worker, stated (at pp 243-4):
Jurisdiction concerning unfair dismissals in the 1991 Act does not provide litigants with the opportunity to canvass the matter twice. Findings and inferences made by the primary tribunal necessarily have to be taken into account by the appellate tribunal. As Barwick CJ said in Edwards v Noble (1971) 124 CLR 296 at 304:
"That the appeal may be by way of rehearing does not, in my opinion, really bear on this question. The consequences of that description of the appeal is that the appeal is one on fact as well as on law and that the appellate court in deciding it may apply the law as it may then exist: further, where additional evidence has been received it may do so in the light of that evidence along with what had been adduced before the court from which the appeal is brought. A rehearing is not, however, a retrial of the issues. The question is not whether the appellate court can substitute its view of the facts which, of course, it is empowered to do, but whether it should do so. In any appeal against a finding of fact, whether or not by way of rehearing, however much the appellate court may be in an equal position with the trial judge as to the drawing of inferences, in my opinion the appellate court ought not reverse the finding of fact unless it is convinced that it is wrong. If that finding is a view reasonably open on the evidence, it is not enough in my opinion to warrant its reversal that the appellate court would not have been prepared on that evidence to make the same finding. Merely differing views do not establish that either view is wrong. But in deciding if his own view is right and that of the primary judge wrong, the nature of the 'fact' found by the primary judge is a matter for consideration."
The provisions of the 1991 Act place the initiative for the introduction of other evidence upon the Full Commission. At the same time, the discretion to confine appeals to matters of jurisdiction or importance has been removed. As all appeals are now of right, it imposes upon the Full Commission a duty in a case such as this, to confine the appeals to correcting errors of law and/or fact and to call for fresh evidence only on the basis of avoiding a miscarriage of justice, because of some omission or error of the primary tribunal.
This is distinguishable from Re Coldham; Ex parte Brideson (No 2) (at 274; 477), in which the High Court adopted the reasoning of Higgins J, in abbreviated form, from Federated Carters and Drivers Industrial Union of Australia v Motor Transport Chauffeurs Association of Australia [1912] 6 CLR 122 at 123. The full extract, however, was (with omissions underlined):
"I think the appellant is entitled to have, under s 17, a re-hearing, a 'review' of the decision; and he has 'in fact' brought evidence which was not before the Registrar. He is entitled to such judgment as I bring to bear upon the question, independently of the Registrar, although of course, I should attach a great deal of weight to the Registrar's view."
Section 17 of the Conciliation and Arbitration Act 1904 (Cth) upon which the judgment was based states:
"The President may review, annul, rescind or vary any act or decision of the Registrar in any manner which he thinks fit."
The authority of Re Coldham; Ex parte Brideson (No 2) is confined to a review involving the admission of fresh evidence in examining the issue a second time, namely, by way of rehearing. Section 88F(3) of the Conciliation Act 1904 (Cth) provided that:
"The Commission may take further evidence for the purposes of an appeal under this section."
As the High Court said:
"In our opinion, upon the correct construction of s 88F, the Commission was bound to make its own decision on the evidence before it, including evidence of events which had occurred since the Registrar's decision."
This opinion is in accordance with the High Court's observation that whether the right of appeal against an administrative decision is given to a court or to an administrative body, the nature of the appeal must ultimately depend on the terms of the statute conferring such right.
1. As to the primacy to be accorded to first instance decisions of the Commission in appeals brought under the terms of the IR Act, in Antonakopoulos v State Bank of New South Wales [1999] IR 385 the Full Bench (Wright J (President), Walton J (Vice-President), Redman C), after identifying a number of factors which warranted the conclusion that there was no appealable error in the first instance decision of Commissioner Neal that was the subject of the appeal to the Full Bench, stated (at 392-3):
These factors were sufficiently taken into account in the balancing of considerations in the Commissioner's decision, and demonstrate that there was no appealable error in the Commissioner's decision. Another finding may have been open having regard to the nature of the misconduct, procedural defects and various mitigating factors such as the commendable prior service of the appellant. However, this appeal bench should not substitute its own views as to a decision which was reasonably open at first instance. The provisions of the Act as to appeals give primacy to first instance decision making in a manner not earlier found in industrial legislation in this State. Applying these provisions appropriately would not permit the appeal to be upheld. It is therefore dismissed.
1. In Bond and Director General of Education and Training [2010] NSWIRComm 178, Staff J, with whom the other members of the Full Bench, Walton J Vice-President and Ritchie C, agreed, stated (at [42]:
42 It should be noted at the outset, that the decision of Connor C, to which this appeal relates, was not one of a discretionary nature of the kind considered in House v The King (1936) 55 CLR 499. The question which the Commissioner determined was whether the dismissal was harsh, unreasonable, or unjust in the circumstances. The determination of that question involved mixed issues of fact and law, rather than the exercise of discretion per se: see Burge v NSW BHP Steel at [4], citing Hollingsworth v Commissioner of Police (No 2) (1999) 47 NSWLR 151 at 181-182; 88 IR 282 at 310; and Port Macquarie Golf Club Ltd v Stead (1996) 64 IR 53 at 59. As such, the appeal is an appeal in stricto sensu: see King v State Bank of New South Wales (No 2) (2002) 126 IR 407 at [65]. As cited in King v State Bank at [70], the relevant principles to be applied on appeal are those set out in the joint decision of Hungerford J and Murphy C (with respect to which Peterson J agreed, at 240) in Re Solicitors (State) Award (No 3) (1997) 72 IR 225 (citing Haynes v CI & D Manufacturing Pty Ltd (1994) 60 IR 149):
... It is not, of course, we would interpose, every case which would require an appellate court to substitute its views for those of the primary judge, and in that respect we agree with the comment by Hill J sitting on appeal in this Court in Hussmann Australia Pty Ltd v Walker (1993) 31 NSWLR 189 at 201; 48 IR 396 at 406 to the effect that there should be no interference with "conclusions on facts unless (the Full Court) is of the opinion that they were not reasonably open on the evidence". ...
1. We will apply these principles.
The appeal
1. Commissioner Constant disclosed her reasoning with respect to the appellant's unfair dismissal application in the Decision at [133]-[228]. The key findings of the Commissioner were:
1. The termination of the appellant's employment was a "dismissal" for the purposes of section 84 of the IR Act (at [105]). This finding is the subject of the cross-appeal by the respondent which is dealt with later in this decision.
2. The termination of the appellant's employment was not unreasonable (at [179]).
3. The termination of the appellant's employment was harsh (at [197]).
4. Reinstatement of the appellant would be impracticable (at [218]).
1. Based on these findings, each of which was made after a careful and detailed recitation of the evidence and submissions of the parties relevant to each of them, the Commissioner ordered the respondent to pay the appellant a sum equivalent to 12 weeks' pay (at [227]-[228]).
2. The appellant raises questions on the appeal and relies upon grounds for the grant of leave to appeal and the appeal as follows:
F. The questions raised by the appeal are:
1. Whether the Commissioner erred in not reinstating the appellant for reasons not the subject of the reasons for dismissal.
2. Whether the Commissioner erred m determining that the appellant should be denied the primary remedy of reinstatement based upon performance grounds in circumstances where the appellant had not been afforded an opportunity to complete a Performance Improvement Plan.
3. Whether the Commissioner erred in failing to have regard to available evidence regarding the availability of workplace mediations and training regarding interacting respectfully colleagues in determining it was impracticable to reinstate the appellant.
4. Whether the Commissioner erred in not according the financial impact of the dismissal sufficient weight in determining whether the appellant should be reinstated.
5. Whether the Commissioner erred in not having regard to the available evidence regarding the high standard of the appellant's work.
6. Whether the Commissioner erred in only awarding compensation in an amount of 12 weeks.
G. Reasons why leave to appeal should be granted:
1. The decision denying the primary remedy of reinstatement is manifestly wrong.
2. The dismissal was based upon misconduct not performance, but in declining to reinstate the appellant the Commissioner focused upon performance criteria.
3. The public importance in ensuring that employees whose entire adult lives have been devoted to one employer are entitled to the primary remedy of reinstatement unless there are compelling reasons against such an order.
4. The error of taking into account a forced resignation in not reinstating an employee and or in the setting of an award for compensation warrants correction and guidance at an appellate level.
5. The public importance in ensuring workers in rural business centres have their cases considered correctly against a background of limited future employment due to their geographical location warrants intervention.
H. Grounds of the appeal are:
1. The Commissioner erred in failing to reinstate the applicant in circumstances where he had been employed by the Respondent for the whole of his adult life, being 31 years.
2. The Commissioner erred in finding that reinstatement was impracticable in circumstances where the misconduct relied upon in founding removal was a one off and was explainable due to factors relating to the appellant's personal life on the day the misconduct occurred.
3. The Commissioner erred in finding that reinstatement was impracticable in circumstances which the appellant had expressed contrition, apologised, and indicated that he would not behave in the same manner again, in particular because the Commissioner did not reject the appellants evidence in that regard.
4. The Commissioner erred in finding that reinstatement was impracticable in circumstances where the appellant's employment was highly specialised and located within a rural business centre which meant that his prospects of finding suitable alternative employment was effectively non-existant (sic).
5. The Commissioner erred in finding that 12 weeks payment was appropriate Compensation in circumstances where:
(a) The appellant had been unemployed to the date of the decision;
(b) The appellant's length of service was 31 years;
(c) The appellant had expressed contrition;
(d) The appellant removal was brought about by contructive dismissal not resignation;
(e) The appellant lost the benefit of around $500,000 worth of superannuation due to the contrastive dismissal;
(f) The appellant's prospects of further employment were grossly limited by his specialised skills and his geographical location.
6. The Commissioner erred in making findings against the appellant arising from his conduct during the course of the meeting of 17 August 2017 where contrary versions were given by the respondents witnesses meaning no clear finding was open.
7. The Commissioner failed to give any or any adequate weight to the managerial errors which were committed during the course of the meeting of 17 August 2017 which inflamed the situation and which were relevant to where reinstatement was practicable.
1. It is clear that the central issue in the appeal is the decision of Commissioner Constant not to order the reinstatement of the appellant on the basis of her finding that reinstatement would be impracticable as, on the balance of probabilities, there would not be sufficient trust to make the relationship viable and productive (at [218]).
Leave to appeal
1. In his submissions on the issue of leave to appeal, the appellant identified four matters which, according to the submissions, warranted the grant of leave to appeal. They were:
6. First, and as is outlined in the submissions in this appeal, the Appellant's entire working life was devoted to the Respondent. The Appellant lived in a rural area with virtually no prospects of other employment other than with the Respondent. His young child also lives in the same town being Bathurst. The Appellant as a result of the termination suffered significant financial detriment, not just in relation to a loss of wages, but a significant cost to his superannuation to find (sic defined) benefit as detailed in the decision of the Commissioner. In all the circumstances where the removal was found to be harsh the Commission would have to find that serious immovable obstacles existed so as to deny the primary remedy of reinstatement. The test is not whether it is appropriate to reinstate. The test is whether it is impracticable to grant the primary of reinstatement. There need to be compelling reasons why a person should not rightfully be returned to their employment especially when the central decision removing the person has been found to be too harsh a penalty. To not reinstate in light of a finding of harshness does not give adequate weight to the finding that the decision was too severe a penalty in all the circumstances. The Appellant submits that there is no clearer an example of a case where reinstatement should've been ordered than the present when viewed in light of a one-off incident of no more than 10 minutes based upon a finding of misconduct under s69 of the GSE.
7. Secondly, the Appellant was removed from his employment due to a finding that he had engaged in misconduct under section 69 of the GSEA. The letter of removal upon which the Respondent relied in affecting the Appellants termination at all times and only sighted s69 relying upon misconduct. At the time of his removal the Appellant had only just commenced a Performance Improvement Plan under section 68 of the GSE. Section 68 of the GSE clearly deals with poor performance of employees rather than misconduct. Section 68 and Rule 36 of the Government Sector Employment (General) Rule 2014 proscribes that various procedural requirements must be adhered to in order to ground the termination of an employee under section 68. The Commissioner in not reinstating the Appellant noted section 68, prejudged the Appellants ability to fulfil any performance requirements under section 68, and by failing to reinstate the Appellant and by relying upon section 68 vis-a-vis poor performance, the Commissioner herself has failed to follow the procedural requirements which would need to be adhered to in order to have removed an employee for poor performance. In so doing the Commissioner has denied the Appellant procedural fairness in not permitting him to have the benefit of the protections related to the s68 poor performance considerations and thereby has committed an error of law.
8. Thirdly, the Commissioner in determining that reinstatement was not practicable only found that there was no trust or not sufficient trust between the Appellant and the Respondent. Implicit in such a finding is that confidence must've existed. In circumstances where the Commissioner had found that the performance of the Appellant warranted his not being reinstated, and where confidence was not relied upon as precluding the reinstatement clarification from the full bench in relation to the severance of trust from the trust and confidence consideration regarding cases such as Perkins v Grace Worldwide (Aust) Pty Ltd (1997) 72 IR 186 is warranted.
9. Fourthly, the Commissioner appears to have had regard in setting compensation to the fact that the Appellant was offered a resignation and "accepted the opportunity to resign before his employment was terminated" and yet had previously found when determining the jurisdictional issue that the Appellants resignation was forced, not voluntary, and therefore constituted was is described as the classic constructed dismissal. These two findings are clearly at odds and again warrant Appellate intervention. There is a public importance in ensuring that decisions are corrected which on their face are manifestly contradictory and where guidance would be of genuine assistance to the public in relation to considerations regarding constructive dismissal verses a voluntary resignation and how those two concepts could stand together in the one decision when determining the matter of compensation.
10. In all the circumstances therefore in taking into account the life altering impact of not being reinstated the Appellant seeks a grant of leave based upon the matters raised above so that his appeal might be heard and determined according to law with the consequent result that he be reinstated to is employment, being the only employment he ever knew throughout his entire adult working life.
1. The respondent opposed the grant of leave to appeal and relied on the following submissions (footnotes omitted):
Leave to appeal
5. This appeal does not satisfy any of the usual circumstances warranting a grant of leave to appeal, in particular:
a. questions raising substantial issues of principle or law having wider implications for the jurisprudence of the Commission, including whether the decision has widespread practical application: see Knowles v Anglican Church Property Trust (No 2) (1999) 95 IR 380 at 382 and Hosemans v Commissioner of Police (No 4) (2005) 150 IR 263 at [5]);
b. a 'demonstrable and cogent matter of principle or law': see Parmjit Singh v Department of Community Services (unreported, Full Bench, IRC No. 5638 of 1999, 20 July) at [10] such as the proper construction and application of legislation: Llandilo Staircases Ply Ltd v Workcover Authority of NSW (2001) 104 IR 204 at 205; Workcover Authority of NSW v Arbor Products International Australia Ply Ltd (2001) 105 IR 81 at 91-92 (per Walton and Boland JJ) and at 102 (per Kavanagh J); Humphries v Cootamundra Ex-Services and Citizens Memorial Club (2003) 128 IR 37 at 53; and
c. demonstrable error: King v State Bank of New South Wales (No 2) (2002) 126 IR 407 at [54]; Allchin v Commissioner of Police (No. 2) [2007] NSWIRComm 280 at [15].
6. Taking in turn each of the four matters that the Appellant argues warrants intervention by the Full Bench.
7. First, the Appellant's argument that the Commission would have to find that 'serious immovable obstacles existed so as to deny the primary remedy reinstatement' or that there be 'compelling reasons why a person should not rightfully be returned to their employment especially when the central decision removing the person has been found too harsh a penalty' is not supported by the case law and is at odds with the Full Bench's consideration of the discretion to reinstate an employee under s 89 of the IR Act in Dumas v Industrial Relations Secretary (on behalf of Department of Communities and Justice) [2019] NSWIRComm 1071 (Dumas). As required by s 89 of the IR Act, the Commissioner weighed all relevant evidence before the Commission in deciding whether it was impracticable to reinstate the Appellant and there is no error in the manner she approached this task.
8. Second, this appeal will not clarify the interrelationship between misconduct under s 69 of the Government Sector Employment Act 2013 (GSE Act) and poor performance under s 68 of the GSE Act. As will be developed below, at [216] of the Decision, the Commissioner did not, as the Appellant asserts at [7] of his outline of submissions on leave to appeal, 'deny the Appellant procedural fairness in not permitting him to have the benefit of the protections related to the s 68 poor performance considerations and thereby commit an error of law'. Instead, the Commissioner relevantly considered at [216] of the Decision that if:
the applicant were to be reinstated, it would be on the same terms and conditions that applied to his position on 12 June 2018 which include the Performance Improvement Plan (PIP) established on 31 August 2017. The applicant would be required to comply with the PIP or be dealt with in accordance with s 68 of the GSE Act and cl 36 pf the GSE Rules. However, the applicant's April Response, provided approximately eight months after the PIP was established did not evidence an acceptance by the applicant of the KPls or a willingness to work within the PIP and improve his performance.
9. The Commissioner took into account the Appellant's evident willingness to work within the PIP and improve his performance or in other words his attitude towards his work and supervisor as one matter relevant to the impracticability of reinstatement. There is nothing improper in this approach and by doing so the Commissioner did not prejudge the Appellant's performance or preclude him from the benefit of the procedural requirements under Rule 36 of the Government Sector Employment (General) Rule 2014.
10. Third, the Appellant's argument at [8] of his outline of submissions on leave that the appeal will clarify the severance of trust from the 'trust and confidence' consideration regarding cases such as Perkins v Grace Worldwide (Aust) Pty Ltd (1997) 72 IR 186 should not be accepted. This line of argument was not developed in the Appellant's Submissions. In any event, the Commission must consider all relevant evidence in deciding whether it is impracticable to reinstate an employee. It also cannot be gleaned from [214] and [218] of the Decision where the Commissioner referred to the Applicant having limited 'trust' in the employment relationship and his supervisor and manager before the termination of his employment that there was necessarily 'confidence'. Nor can this passage of the judgment give rise to the assertion that the Commissioner was severing 'confidence' from the 'trust and confidence consideration'. The Commissioner merely considered it a relevant factor in deciding whether it was impracticable to reinstate the Applicant. It cannot be seriously argued that limited 'trust' in the employment relationship and an employee's supervisor and manager is not relevant to this consideration. ln any event, the Industrial Relations Court in Perkins actually referred to 'trust' by itself without always using the composite phrase 'trust and confidence', so there is no issue that the test in Perkins has not been correctly applied. For example, at
p 191:
It is rare for any human being to have total trust in another. What is important in the employment relationship is that there be sufficient trust to make the relationship viable and productive. Whether that standard is reached in any particular case must depend upon the circumstances of the particular case. And in assessing that question, it is appropriate to consider the rationality of any attitude taken by a party.
11. Finally, there is no inconsistency in the Commission finding that the Secretary's offer to the Appellant of the opportunity to resign was a constructive dismissal (a finding that the Respondent cross-appeals) and taking into consideration for the purposes of setting compensation that he was afforded the opportunity to resign and accepted this opportunity. There was evidence before the Commission of the benefits to an employee of accepting the opportunity to resign in the form of reputation in the marketplace and the ability to find alternative work. These are not irrelevant matters for the purposes of setting compensation.
12. In substance, the appeal is seeking to re-litigate the merits on the question of the impracticability of reinstatement and the setting of compensation. As the appeal is against a decision involving the exercise of a discretion, an error of principle or approach must be identified rather than seeking to demonstrate a different decision based on the facts ought to have been made. For the reasons set out below, the Commissioner acted consistently with a long line of authorities in applying the proper approach to the facts of the case with respect to the relevant remedy.
1. We are in general agreement with the submissions of the respondent on the question as to whether leave to appeal should be granted in this matter.
2. In support of his application for leave to appeal, the appellant has submitted that a consequence of the finding that his dismissal was harsh was that the "Commission would have to find that serious immoveable obstacles existed so as to deny the primary remedy of reinstatement" (paragraph 6 at [32] above). We disagree. A finding that a particular dismissal was harsh, unreasonable or unjust is a necessary prerequisite to any consideration of the issue of impracticability of reinstatement. A finding of harshness does not raise the bar on the issue of impracticability of reinstatement to a search for "serious immoveable obstacles… to… the primary remedy of reinstatement".
3. We reject the appellant's submission that "the Commissioner denied the Appellant procedural fairness in not permitting him to have the benefit of the protections related to the s 68 poor performance considerations and thereby has committed an error of law" (paragraph 7 at [32] above). The Commissioner's reference to section 68 of the GSE Act, the PIP that was established on 31 August 2017 and the appellant's poor performance, was in the context of the Commissioner's consideration at [216] of the Decision of the appellant's non-acceptance of the KPIs and his unwillingness to work within the PIP to improve his performance. These were matters which were entirely appropriate for the Commissioner to consider and form a judgement as to the weight to be given to them on the issue of impracticability of reinstatement.
4. With respect to the appellant's submission to the effect that Commissioner Constant has effectively bifurcated the concept of "trust and confidence" in the employment relationship into a consideration of "trust" only (paragraph 8 at [32] above), we agree with the respondent's submission on this issue (paragraph 10 at [33] above). We note that, at [200] of the Decision, the Commissioner made reference to the "level of mutual trust and confidence needed in each employment relationship…". Further, the Commissioner's finding at [218] that "there will not be sufficient trust to make the relationship viable and productive…" was supported by evidence and was, consistent with the authorities such as Perkins v Grace Worldwide (Aust) Pty Ltd ([1997] 72 IR 186), a proper basis to support a finding that reinstatement would be impracticable.
5. We also reject the appellant's submission at paragraph 10 (at [32] above) to the effect that the Commissioner erred by taking into account, in determining the appropriate amount of compensation to award, that the appellant was offered and accepted the opportunity to resign. It was legitimate for the Commissioner to give consideration to this matter, along with the other matters listed at [226] of the Decision, for the reasons set out at paragraph 11 of the respondent's submissions (at [33] above).
6. The appellant is, in effect, attempting to retry before this Full Bench, the factual issues which were heard and determined against him at first instance. The authorities cited above at [24]-[26] above and the terms of section 191 of the IR Act make it clear that such a course is not open to an appellant in this jurisdiction. The Full Bench will only intervene to correct error. Having heard the appeal in its entirety, we are of the opinion that each of the findings of fact made by the Commissioner, and the conclusion she reached based on those findings as to the impracticability of reinstatement, were reasonably open on the evidence. In an appeal such as this, it not open to the Full Bench to substitute its views for those of the Commissioner.
7. A finding that reinstatement and/or re-employment is or is not impracticable in an unfair dismissal occurs following the identification and weighing up of all of the evidence relevant to that issue and the formation of a judgement or conclusion by the Commission based on that evidence. We can discern nothing in the manner in which Commissioner Constant undertook the task of identifying and weighing up the evidence before her and concluded that reinstatement was impracticable in this case that "raises substantial issues of principle or law or has wider implications for the jurisprudence of this Commission…" (Knowles v Anglican Church Property Trust (No 2) (1999) 95 IR 380 at 382).
8. With respect to the Commissioner's order that the appellant be paid compensation of an amount of 12 weeks' pay, this constituted a discretionary decision with which the Full Bench would not interfere even if we would have exercised the discretion differently.
9. House v The King [1936] 55 CLR 499 is an authority which has been consistently followed in this jurisdiction. That case involved an appeal to the High Court from a sentence a of three months' imprisonment with hard labour which the Court of Bankruptcy (Lukin J) had imposed upon Mr House for an admitted breach of a provision of the Bankruptcy Act 1924-1933 (Cth). The plurality of the High Court (Dixon, Evatt and McTiernan JJ) described the sentence as "severe" but, nevertheless, dismissed the appeal. In doing so their Honours stated (at p 504-505):
But the judgment complained of, namely, sentence to a term of imprisonment, depends upon the exercise of a judicial discretion by the court imposing it. The manner in which an appeal against an exercise of discretion should be determined is governed by established principles. It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure to properly exercise the discretion which the law opposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of discretion is reviewed on the ground that a substantial wrong has in fact occurred.
1. It has not been demonstrated that the Commissioner failed to properly exercise the discretion committed to her in accordance with the principles espoused in House v King (see also Mace v Murray (1955) 92 CLR 370). We find that the matters which the Commissioner considered in determining the amount of compensation that the respondent would be required to pay the appellant were all matters which were appropriate to be taken into account in the exercise of her discretion (Decision at [225]-[226]).
2. This is not a case where leave to appeal should be granted and it is refused.
Leave to cross-appeal
1. Different considerations arise with respect to the respondent's cross-appeal which involves a consideration of the interaction between section 69 of the GSE Act and section 84 of the IR Act.
2. Relevant parts of section 69 of the GSE Act are set out below:
69 Misconduct—Public Service and other prescribed government sector employees
……………………………….
(2) The person who exercises employer functions in relation to an employee of a government sector agency is responsible for dealing with any misconduct by that employee in accordance with this section.
(3) The government sector employment rules may deal with the following:
(a) misconduct by employees of government sector agencies,
(b) the procedural requirements for dealing with allegations of misconduct by employees of government sector agencies (consistently with procedural fairness).
(4) If, in accordance with those rules, there is a finding of misconduct by an employee of a government sector agency, the person who exercises employer functions in relation to the employee may take any of the following actions:
(a) terminate the employment of the employee (without giving the employee an opportunity to resign),
(b) terminate the employment of the employee (after giving the employee an opportunity to resign),
(c) impose a fine on the employee (which may be deducted from the remuneration payable to the employee),
(d) reduce the remuneration payable to the employee,
(e) reduce the classification or grade of the employee,
(f) assign the employee to a different role,
(g) caution or reprimand the employee.
1. The termination of the appellant's employment was effected pursuant to subsection 69(4)(b) upon him availing himself of the opportunity to resign.
2. For completeness, relevant parts of section 68 of the GSE Act are set out below:
68 Unsatisfactory performance of government sector employees
(1) The government sector employment rules may deal with the procedural requirements for dealing with unsatisfactory performance (consistently with procedural fairness).
(2) If the performance of an employee of a government sector agency is determined to be unsatisfactory in accordance with those rules, the person who exercises employer functions in relation to the employee may (without limitation on relevant action) take any of the following actions:
(a) terminate the employment of the employee (after giving the employee an opportunity to resign),
(b) reduce the remuneration payable to the employee,
(c) reduce the classification or grade of the employee,
(d) assign the employee to a different role.
……………………………….
1. The cross-appeal is primarily against Commissioner Constant's finding that there was a dismissal for the purposes of sections 84 of the IR Act, despite the fact that the appellant had tendered a letter of resignation. The Commissioner's reasoning which led her to make this finding is at [74]-[105] of the Decision which we set out below:
74 If the respondent's submissions on the construction of s 84 of the IR Act and sub-s 69(4)(b) of the GSE Act are correct then when an employee takes up an opportunity to resign offered pursuant to sub-s 69(4)(b) of the GSE Act, then, regardless of the actual circumstances that gave rise to, or were a consequence of, the decision as to the disciplinary action, and the long recognised principle of constructive dismissal and the authorities on the meaning of "dismissal" in s 84 of the IR Act such as Allison, the relevant termination of employment would be excluded from review pursuant to s 84 of the IR Act. It is necessary to determine if the Parliament intended this.
75 A number of well-known principles exist to assist the Commission to determine whether the Parliament intended that sub-s 69(4)(b) of the GSE Act impliedly repeal Pt 6 of Ch. 2 of the IR Act to the extent that a dismissal for the purposes of s 84 cannot include a matter whereby an employee accepts an offer to resign made pursuant to s 69(4)(b) of the GSE Act.
76 Firstly, the GSE Act and the IR Act must be construed in a way that best achieves an harmonious result: Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 ("Project Blue Sky") at 381 - 382 [70]. The task of the Commission when dealing with the application of two related statutes is to ascertain the legislative intention extracted from all available indications: Eaton at [45]. Deciding whether and how the two statutes can "stand or live together" in the relevant respect "requires the construction of, and close attention to, the particular provisions in question": Ferdinands at [18].
77 An Act must be construed as a whole. As the High Court put it in Project Blue Sky (at [68]):
"The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute. The meaning of the provision must be determined 'by reference to the language of the instrument viewed as a whole'. In Commissioner for Railways (NSW) v Agalianos, Dixon CJ pointed out that 'the context, the general purpose and policy of a provision and its consistency and fairness are surer guides to its meaning than the logic with which it is constructed'. Thus, the process of construction must always begin by examining the context of the provision that is being construed".
78 The Commission should not construe the meaning of a specific provision in an Act without considering the sections which surround it, and the structure and meaning of the Act as a whole. It is also not correct to construe the interaction of sub-s 69(4)(b) of the GSE Act and s 84 IR Act without taking into consideration the context of each. Further, just as an Act should be read as a whole, each provision of an Act should be read as a whole and it is presumed that every word in a provision has work to do, so that each word should be given effect as far as possible: Plaintiff M702011 v Minister of Immigration and Citizenship (2011) 244 CLR 144 at [97].
79 The Commission should also, where possible, interpret provisions of statutes in the way that best promotes the express or implied objects of the Acts, avoids internal inconsistency, and avoids absurdity or inconvenience.
80 The High Court in Eaton found that the objects of the Police Act include the maintenance of the integrity and discipline of the New South Wales Police Force (at [43]). The objects of the GSE Act are set out at s 4 and include the establishment of the Public Service as the general service within the government sector and the establishment of an ethical framework for the government sector comprising core values and principles.
81 There are similarities in the objects of the GSE Act and the Police Act. However, the statutory scheme under the Police Act considered in Eaton is different from the statutory scheme under the GSE Act. The GSE Act, the Government Sector Employment Regulation 2014, and the GSE Rules regulate aspects of the employment of the Public Service, and to some extent, other government sector employees. The remedies available to Public Service employees in respect of unfair dismissal and public sector discipline matters are found in the IR Act, not in the GSE Act. The Police Act, in addition to regulating the appointment and terms of police officers, contains a scheme for review of disciplinary orders (s 174 of the Police Act) and removal orders (s 181D of the Police Act). The provisions of this scheme, and the inconsistencies between it, in particular the Commissioner's powers to appoint and remove officers and the provisions of Pt 9, compared with the provisions of Pt 6 of Ch. 2 of the IR Act, informed the High Court's finding of an implied repeal in Eaton. Similarly in Ferdinands, the High Court found an indication of legislative intention was present in the extent to which the Police Act 1998 (SA) dealt with the topic of dismissal. That Act dealt exhaustively with the dismissal of police officers and therefore impliedly repealed the earlier Industrial and Employee Relations Act 1994 (SA).
82 Looking at the GSE Act as a whole, the legislature determined that certain industrial and legal proceedings should be excluded for executive and non-executive employees employed pursuant to the GSE Act. Section 58 of the GSE Act relevantly provides:
58 Industrial or legal proceedings excluded
(1) In this section, executive employee means the Secretary of a Department or other Public Service senior executive, and non-executive employee means a Public Service employee other than an executive employee.
(2) In this section, a reference to the employment of an executive employee is a reference to:
(a) the engagement of, or failure to engage, a person as an executive employee, or
(b) the assignment or re-assignment of the executive employee to a role in a band, or
(c) the removal, retirement, termination of employment or other cessation of employment of an executive employee, or
(d) any disciplinary proceedings or action taken against an executive employee, or
(e) the remuneration or other conditions of employment of an executive employee.
(3) The employment of an executive employee, or any matter, question or dispute relating to any such employment, is not an industrial matter for the purposes of the Industrial Relations Act 1996.
(4) Parts 6, 7 and 9 of Chapter 2 of the Industrial Relations Act 1996 do not apply to or in respect of the employment of an executive employee.
(5) Any State industrial instrument (whether made before or after the commencement of this section) does not have effect in so far as it relates to the employment of executive employees. This subsection does not prevent the regulations or other statutory instruments or any contract of employment from applying the provisions of any such industrial instrument to the employment of an executive employee.
(6) The engagement of, or the failure to engage, a person as a non-executive employee, or any matter, question or dispute relating to any such engagement (or failure to engage), is not an industrial matter for the purposes of the Industrial Relations Act 1996.
(7) No proceedings for an order in the nature of prohibition, certiorari or mandamus or for a declaration or injunction or for any other relief, lie in respect of a matter that is declared by this section not to be an industrial matter for the purposes of the Industrial Relations Act 1996.
(8) Nothing in this section prevents any of the following proceedings from being brought by an employee of a Public Service agency in relation to the employment of another employee of any Public Service agency:
(a) proceedings under Part 9 of the Anti-Discrimination Act 1977 in relation to a complaint under that Part,
(b) proceedings under section 213 of the Industrial Relations Act 1996 to enforce the provisions of section 210 (Freedom from victimisation) of that Act.
83 The legislature has excluded the circumstances of some terminations of employment of Public Service employees from review by the Commission pursuant to s 84 of the IR Act. Sub-section 58(4) excludes executive employees from the operation of Pt 6 of Chap 2 of the IR Act, which includes s 84 of the IR Act.
84 The legislature was clear in s 79 that Pt 6 of Ch. 2 of the IR Act would not apply to the removal of Statutory Officers as follows:
79 Operation of this Part
(1) This Part prevails over any inconsistent provision of any other Act or law or of the terms of appointment of or contract with a person.
(2) Parts 6 and 9 of Chapter 2 of the Industrial Relations Act 1996 do not apply to or in respect of the removal of a person from office under this Part.
(3) This Part applies to a person appointed to a statutory office even though the Act concerned excludes the application of this Act, unless it expressly excludes the application of this Part.
(4) This Part applies to persons holding office at the commencement of this Part, as well as to persons appointed to an office afterwards.
85 Further, the legislature determined that the GSE Act was not to effect the operation of the IR Act, save for ss 58 and 74. Sub-section 85(1) of the GSE Act is in the following terms:
85 Operation of industrial relations and superannuation legislation
(1) This Act does not affect the operation of the Industrial Relations Act 1996. This subsection does not limit section 58 (Industrial or legal proceedings excluded) and section 74 (Excess employees—jurisdiction of Industrial Relations Commission).
86 The High Court has often observed that the search for legislative meaning begins with the statute, and ends with the statute (FCT v Consolidated Media Holdings Ltd (2012) 87 ALJR 98, at [39], per curiam citing Alcan (NT) Alumina Pty Ltd v Commissioner of Territory Revenue (2009) 239 CLR 27 at 46 [47]).
87 In this instance, the legislative intention as to the effect of the GSE Act on the operation of the IR Act is set out in s 85 of the GSE Act; the effect being that other than as set out in s 58 and s 74 of the GSE Act, the operation of the IR Act is not affected. The respondent has not pointed to anything in the GSE Act, like the scheme set out in Pt 9 of the Police Act which limits Pt 6 of the IR Act (Eaton at [90]), which would require the Commission to read s 85 of the GSE Act in any other way than a plain reading.
88 I do not consider that there is any relevant inconsistency between the GSE Act and the IR Act which creates an implied repeal of, or limits the operation of, s 84 of IR Act and the common law in respect of constructive dismissals brought pursuant to the IR Act.
89 I turn now to the respondent's submissions that the Chief Commissioner's "recognition of the statutory framework", including sub-s 69(4) of the GSE Act and s 84 of the IR Act in his decision of Fidawy supports the respondent's construction of the relevant sections of the GSE Act and IR Act. In Fidawy, the Chief Commissioner said:
21 In my view application of that authority [Clarke v Pittwater RSL Club Limited (1998) 84 IR 309] in this case demands recognition of the statutory framework relating to this employment. In particular the clear distinction drawn between termination of employment and reduction in grade.
90 The Chief Commissioner then went on to compare Pt 7 of Ch 2 of the IR Act which provides for public sector disciplinary appeals and Pt 6 of Ch 2 which provides for unfair dismissals.
23 For completeness it is appropriate to note that s 84 of the Act is found in Ch 2 Part 6 of the Act. Ch 2 Pt 7 provides in s 98 for appeals to the Commission against certain public sector disciplinary decisions. The section relevantly provides:
98 Right of appeal
(1) Despite anything contained in any other Act, a public sector employee may, subject to and in accordance with this Part, appeal to the Commission against an appealable decision of his or her employer.
The term 'appealable decision' is defined in s 91 as follows:
appealable decision means a decision of a kind referred to in section 97 (1).
In turn s 97(1) provides:
97 Notice of certain decisions etc
(1) This section applies to the following decisions made by a public sector employer in relation to a public sector employee:
(a) a decision to defer, for a period in excess of 6 months, the payment of an increment to the employee,
(b) a decision to reduce the rank, classification, position, grade or pay of the employee,
(c) a decision to impose a fine or forfeit pay,
(d) a decision to annul the appointment of an employee appointed on probation,
(e) a decision to suspend the employee as a punishment where the employee is held to be guilty of misconduct or contravention of any law or any rule or direction of the employer,
(f) a decision to dismiss the employee,
(g) a decision to direct or to require the employee to resign.
(Emphasis added)
24 The parallels with s 69(4) of the GSE Act are evident.
25 Moreover, ss 83 and 84 of Ch 2 Pt 6 relevantly provide:
83 Application of Part
(1) This Part applies to the dismissal of:
(a) any public sector employee, or
…
84 Application for remedy by dismissed employee
(1) If an employer dismisses an employee and the employee claims that the dismissal is harsh, unreasonable or unjust, the employee may apply to the Commission for the claim to be dealt with under this Part.
…
(5) In this Part:
dismissal includes:
(a) the threat of dismissal, and
(b) in the case of a public sector employee—dispensing with the services of the employee, dismissing the employee as a consequence of disciplinary proceedings against, or the commission of an offence by, the employee or annulling the appointment of the employee.
26 The principles of statutory construction, recently revisited in Kaldas v Barbour [2017] NSWCA 275 (Bathurst CJ at [116]), include a requirement:
that the statute must be read as a whole on the prima facie basis that its provisions are intended to give effect to harmonious goals: Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28 at [70]; Plaintiff S4/2014 v Minister for Immigration and Border Protection (2014) 253 CLR 219; [2014] HCA 34 at [42].
27 There is no justification to construe "dismissal" in s 84 differently from the way that word is used in s 97(1) at least in relation to a public sector employee. I am reinforced in that view by the terms of s 84(5)(b) of the Act. Although the definition is expressed to be inclusive, in my view it is clear that the concept of dismissal for public sector employees is confined to termination of the employment.
28 I conclude therefore that a reduction in grade (or demotion) in accordance with s 69(4) of the GSE Act is not a dismissal within the meaning of s 84 of the Act.
91 The Chief Commissioner's decision considered the statutory schemes in the course of determining whether a demotion or reduction in grade is a dismissal for the purposes of s 84 of the IR Act. The Chief Commissioner's decision that a demotion is not a dismissal in these circumstances is not inconsistent with a finding that dismissal can include a termination of employment by means of a resignation following an offer pursuant to s 69(4)(b) of the GSE Act.
92 If there is no "implied repeal" in respect of the meaning of dismissal in s 84 of the IR Act created by sub-s 69(4)(b) of the GSE Act then there is no difference from the employer's perspective between the effect of sub-s 69(4)(a) and sub-s 69(4)(b). While the employee will receive the benefits of accepting the offer to resign pursuant to sub-s 69(4)(b), if the construction advanced by the respondent is rejected then the employer may, subject to the specific facts, remain at law, the "initiator of the termination" for the purposes of s 84 of the IR Act. However, this is no different from the circumstances of any other employer who offers an employee who the employer has determined to be guilty of misconduct, the opportunity to resign before the employer acts to dismiss him or her.
93 Further, I do not consider this offends the principle of statutory construction that requires the Commission to strive for a construction that gives every word meaning, as the power to offer and accept a resignation before terminating an employee's employment is different from a power to terminate the employee's employment, regardless of whether the employee has a right of review pursuant to s 84 of the IR Act under either or both provisions of the GSE Act.
94 I find that there is no implied repeal effected by s 69(4)(b) of the GSE Act and the GSE Act does not require the Commission to treat a resignation effected as a consequence of an offer from the person exercising the employer powers pursuant to sub-s 69(4)(b) differently from a resignation by an employee not subject to the GSE Act.
95 The question next to be determined is whether there was no "dismissal" because, despite the decision of the Secretary, DFSI to take action pursuant to sub-s 69(4) of the GSE Act and the 31 May 2018 Letter, the applicant's resignation was freely given such that the applicant was the real and effective initiator of the Termination, not the Secretary, DFSI. Sheffield v Oxford Controls Co Ltd (1979) IRLR 133, R v Prince Alfred College (1979) 46 SAIR 598, Allison v Bega Valley Council (1995) 63 IR 68.
96 The applicant's evidence in his statement of 8 October 2018 about his decision to resign is:
48. If it was my decision I would still be employed by DFSI. However, The Termination Letter offered no alternative except the termination of my employment. I would not have resigned if the termination letter did not say "if you choose not to resign, your employment will terminate effective 12 June 2018". I believed I had no option. In the circumstances I believed I should resign.
97 The evidence of Mr Davies regarding his discussions with the applicant about whether the applicant would resign is contained in his statement of 29 October 2018:
10. On 15 May at 10:52 AM I called the applicant on his mobile phone. The call lasted 498 seconds. …
11. Throughout the course of the phone conversation with the applicant a discussion surrounded the misconduct finding, the submissions process and the final decision then being made. We discussed the following:
Me: You should speak to your union with regards to avenues of redress available through the "IRC" as it is not my place to do so
Applicant: What does the proposed action to terminate my employment after first being given an opportunity to resign mean? What will the difference between resignation and dismissal be?
Me: in either case accrued and untaken recreation and extended leave would be paid to you. If you should choose to resign, "the record" would reflect resignation as the reason for exit. Resignation would be displayed on any final paperwork and a statement of service showing resignation could be provided. This would mean if you are seeking employment, you could advise any prospective employer that you had left for personal reasons and resigned
Applicant: So say if I went for a job in Water mapping I could say I wanted a career change after almost 30 years at Spatial.
Me: that's correct. If you choose not to resign, you would be dismissed and the above documentation would state "dismissal" as the reason for exit. Please remember to provide any written submissions for the consideration of the Secretary.
98 The applicant's statement in reply says:
5. Paragraph 11: Mr Davies refers to a conversation he had with me on 15 May 2018. By then I had been on special leave for 8 months. Such a long time had passed by then and I was really concerned about what was happening with the investigation. I was worried about my employment future but I still believed they should not be dismissed so even if the possible outcomes Mr Davies discussed with me included resignation it was not my intention to resign.
99 The applicant was cross-examined about his decision to resign. The applicant agrees that he received advice from the PSA between receiving the Findings Letter on 8 May 2018 and submitting his resignation on 6 June 2018, and the applicant does not disagree with Mr Davies' evidence that Mr Davies spoke with him about the effects of resignation, nor does he disagree that he spoke with another HR officer of DFSI about resignation. However, the applicant says, and I accept, that between 8 May 2018 and the meeting with the Secretary, DFSI on 24 May 2018, the applicant concentrated on the 24 May 2018 Submission and not on whether he would accept an offer to resign if the Secretary, DFSI did not change his mind on the proposed disciplinary action.
100 It was only once the applicant received the 31 May 2018 Letter that the applicant was aware that the Secretary, DFSI would not change his mind about the disciplinary action and thus the applicant must choose whether to accept the offer to resign in the seven days he was provided. I do not agree with the respondent that the applicant had more than one month to consider the offer to resign.
1. The Commissioner then cited certain passages from the decision of the Full Bench (Peterson and Marks JJ, Connor C) in Allison v Bega Valley Council [1995] 63 IR 68 which we have set out at [82] below and then continued as follows:
103 The circumstances in Allison set out above have commonality with the circumstances of the applicant. The cause of the applicant's resignation was the threat of termination. The time that elapsed between the applicant being given the opportunity to resign and effecting his resignation is explained by the applicant seeking to change the mind of the decision-maker through his written submissions and the meeting with the Secretary, DFSI. The information given to the applicant by the HR officers of the respondent about the effect of a resignation did not "alter the essential character of the transactions by the parties".
104 This was not a case where the applicant was offered, negotiated and/or accepted terms which were satisfactory to him and for which he agreed willingly to resign. The decision to resign was not brought about by considerations other than the threat. Although the terms of the Resignation Letter refer to the applicant finding another job, I accept the evidence set out at paragraph [48] of the applicant's statement of 8 October 2018 that he "believed [he] had no option. In the circumstances I believed I should resign."
105 The causation of the resignation was the threat of termination of employment by the Secretary, DFSI: Sheffield v Oxford Controls Co Ltd (1979) IRLR 133 cited in Allison at 74. The Termination was initiated by the employer, the threat of dismissal remained the operative factor in the applicant providing the Resignation Letter and the termination is a "dismissal" for the purposes of s 84 of the IR Act.
1. The respondent's Application for Leave to Cross-Appeal and Appeal contained the following:
F. The questions raised by the cross-appeal are:
1. whether a person who exercises employer functions in respect of an employee of a government sector agency decides to take action under s 69(4)(b) of the GSE Act and the employee has resigned, has dismissed that employee for the purposes of s 84(1) of the IR Act;
2. whether an employee who decides to resign freely after being given a choice as to whether or not to resign mandated by s 69(4) of the GSE Act has been dismissed;
3. the proper meaning and operation of s 85 of the GSE Act.
G. Reasons why leave to cross-appeal should be granted:
1. This is the first case concerning the meaning and operation of the expression "after giving the employee an opportunity to resign" in ss 68(2) and 69(4)(b) of the GSE Act in the context of Ch 6 of Pt 2 (sic Pt 6 of Ch 2) of the IR Act.
2. There is a public interest in upholding the ordinary rules of construction that where two statutes share the same field of operation, both statutes should be construed in a way that best achieves a harmonious result. In this case, this involves giving the words "opportunity to resign" their ordinary meaning and operation and recognising the elaborate statutory scheme in the GSE Act which authorises the person exercising employer functions to allow a person to resign as alteranative (sic) to dismissal. ·
3. The public importance in ensuring there is certainty and clarity as to whether giving an employee the opportunity to resign made pursuant to ss 68(2) and 69(4)(b) of the GSE Act constitutes a 'dismissal' for the purposes of s 84 of the IR Act.
H. Grounds of the appeal are:
1. In circumstances where the Cross-Appellant afforded the Cross-Respondent an opportunity to resign pursuant to an action authorised under s 69(4)(b) of the GSE Act and the Cross-Respondent resigned pursuant to that opportunity, the Commissioner erred in finding that the Cross-Appellant's decision to give the Cross-Respondent such an opportunity constituted a 'threat of dismissal' or a 'constructive' dismissal for the purposes of ss 83(5) and 84(1) of the IR Act (Decision [105]).
2. The Commissioner erred in not finding that on the proper and harmonious construction of the statutory schemes contained in Pt 5 of GSE Act and Pt 6 of Ch 2 and Pt 7 of the IR Act is that, where the Cross-Appellant afforded the CrossRespondent an opportunity to resign (compared to directing or requiring the employee to resign under the formers 42(1) of the Public Sector Employment and Management Act 2002 (NSW) which is a decision capable of challenge in s 97( I )(g) of the IR Act), the Cross-Respondent had not been dismissed for the purposes of s 84(1) of the IR Act.
3. The Commissioner misconstrued the operation of s 85(1) of the GSE Act by giving it a "plain reading" (Decision [87]) preserving the usual definition of 'dismissal' ins 84(1) of the IR Act rather than concluding, in accordance with Commissioner of Police v Eaton (2013) 252 CLR 1, that such a provision does not apply where it is "especially restricted" by the statutory scheme in Pt 5 of the GSE Act, in particular, s 69(4)(b).
4. The Commissioner erred in concluding that, upon the Cross-Appellant giving the Cross-Respondent the opportunity to resign under s 69(4)(b) of the GSE Act, the Cross-Respondent did not freely resign from his employment and was dismissed for the purposes of s 84(1) of the IR Act.
1. We consider that it is appropriate to grant leave to appeal in the cross-appeal. This is the first case to consider the meaning and operation of the expression "after giving the employee an opportunity to resign" in subsections 68(2)(a) and 69(4)(b) of the GSE Act in the context of the provisions of Part 6 of Chapter 2 of the IR Act. This issue raises a matter of such importance that, in the public interest, leave to cross-appeal should be granted.
The cross-appeal
1. In support of grounds 1, 2 and 3 of the cross-appeal (at [51] above), the respondent put the following submissions (footnotes omitted):
12. Two statutes with overlapping fields of operation must be construed in a way that best achieves a harmonious result. As the High Court has stated:
Where conflict appears to arise from the language of particular provisions, the conflict must be alleviated, so far as possible, by adjusting the meaning of the competing provisions to achieve that result which will best give effect to the purposes and language of those provisions while maintaining the unity of all the statutory provisions.
13. The task of the court when dealing with the application of two related statutes is to ascertain the legislative intention extracted from all available indications. Deciding whether (and how) two statutes can "stand or live together" in the relevant respect "requires the construction of, and close attention to, the particular provisions in question". Further, general words are not to be taken as derogating from specific words.
14. Employment and discipline in the Public Service is regulated by the GSE Act. The actions taken by the employer in this case accord with the procedure outlined in the GSE Act and the Government Sector Employment Rules 2014 (GSE Rules) and need to be seen in that context.
15. There is no general power of dismissal where the Secretary of the Department has formed the view that an employee has engaged in misconduct. However, the Secretary of the Department may remove or discipline an employee pursuant to s 69(4) of the GSE Act. Section 69(4) of the GSE Act provides that:
(4) If, in accordance with those rules, there is a finding of misconduct by an employee of a government sector agency, the person who exercises employer functions in relation to the employee may take any of the following actions:
(a) terminate the employment of the employee (without giving the employee an opportunity to resign),
(b) terminate the employment of the employee (after giving the employee an opportunity to resign),
(c) impose a fine on the employee (which may be deducted from the remuneration payable to the employee),
(d) reduce the remuneration payable to the employe ,
(e) reduce the classification or grade of the employee,
(f) assign the employee to a different role,
(g) caution or reprimand the employee.
16. In this case, the Cross-Appellant did not proceed to terminate the Cross-Respondent. Rather, the Cross-Appellant accepted his resignation after he had given him an opportunity to resign in accordance with s 69(4)(b) of the GSE Act.
17. It can be seen that s 69(4) of the GSE Act provides the person exercising employer functions with a comprehensive catalogue of disciplinary actions, with the most severe penalty 'terminate (without an opportunity to resign)' as the first option and the least severe penalty 'caution or reprimand' as the last option.
18. Section 69(4)(b) of the GSE Act expressly provides for a person exercising employment functions to give an employee an opportunity to resign before taking the action of termination. The resignation is distinct from the action of 'terminating the employment of the employee' as it is placed in parenthesis and the termination can only occur 'after' the opportunity to resign has been afforded. Section 69(4)(b) of the GSE Act can be contrasted with s 69(4)(a) which provides for termination of employment without giving the employee an opportunity to resign.
19. A similar regime is established by s 68 of the GSE Act which relates to actions that may be taken with respect to unsatisfactory performance. However, the scheme established by s 68(2) of the GSE Act does not include the more severe penalty of termination without an opportunity to resign. It includes as the most severe penalty at s 68(2)(a) the termination of employment (after giving the employee an opportunity to resign).
20. Further, with respect to both s 68 and s 69 of the GSE Act, the GSE Rules establish procedural steps that must be carried out before any outcome can be reached. These procedural steps include with respect to s 69 of the GSE Act, an opportunity to respond to any allegations of misconduct and notice that action may be taken pursuant to s 69(4) of the GSE Act.
21. The starting point of statutory construction is to interpret the text of each provision in the context of their respective statutes as a whole. Absent any definition of a particular word in a statute, the ordinary meaning should prevail unless there is something in the context to suggest that another meaning is intended. All parts within a statute, shall, if possible, be construed so as to be consistent with one another.
22. The terms used in s 69(4) of the GSE Act are not defined and bear their ordinary meaning. Accordingly, the termination of the employment of an employee certainly amounts to a dismissal under s 84(1) of the GSE Act. However, a person 'resigns' from employment when he or she advises the employer that they will no longer work in that employment from a particular date. At law, a resignation means that an employee has left employment voluntarily and thereby initiated the dismissal. A resignation is the opposite of dismissal where the employer is the party which initiates the termination.
23. Where an employee is offered the opportunity to resign and accepts it, the person exercising employment functions does not take the action of 'terminating' the employment. The legal characterisation of the action is a 'resignation'. This is not a mere 'label' but carries with it all the ordinary legal consequences of a 'resignation'. In using the word "resign" ins 69(4)(b) of the GSE Act, there is nothing to suggest that Parliament did not intend it to have its ordinary meaning and legal effect.
24. By taking advantage of the opportunity to resign, the employee obtains the benefit of maintaining their reputation internally and externally and this is a useful asset when seeking new employment in the marketplace. The corollary of this is that except in limited circumstances, a 'resignation' does not afford an employee the opportunity to commence proceedings claiming there has been an unfair dismissal or unlawful termination of employment. It distinguishes this disciplinary action from 'termination (without opportunity to resign) under s 89(4)(a) of the IR Act.
25. When the Cross-Appellant gave the Cross-Respondent an opportunity to resign, it acted in accordance with a right authorised by s 69(4) of the GSE Act and the statutory scheme and therefore the acceptance of the Cross-Respondent's resignation was not a 'dismissal' for the purposes of s 84(1) of the JR Act where the GSE Act authorises and provides for the action.
26. Further, by informing the Cross-Respondent that 'if he chose not to resign, his employment would terminate', the Secretary was merely placing the Cross-Respondent 'on notice' of the procedure to be followed under s 69(4)(b) of the GSE Act and the 'risk' of dismissal as authorised by that provision. To the extent this constitutes a 'threat' it is not a 'threat of dismissal' contemplated by s 83(5) of the IR Act.
27. It would be odd that an outcome short of dismissal authorised by the GSE Act or GSE Rules would amount to a threat of dismissal. ln McDonald v Commissioner of Police (No 2), Murphy J points out that merely sending a show cause notice in accordance with the GSE Rules can theoretically be seen as a 'threat of dismissal'. However, in Mikhail Karem-AI Fidawy v The Sydney Opera House Trust, Chief Commissioner Kite SC considered that notices given pursuant to the GSE Rules were authorised by the rules and that there was a real question as to whether such notices advising of the risk of dismissal could amount to a threat of dismissal for the purposes of s 84(1) of the IR Act. It is submitted that the legislature could not have intended for these procedural steps taken in accordance with the GSE Rules to amount to a dismissal under s 84(1) of the IR Act. Similarly, merely presenting an option of resignation before termination of employment in accordance with s 69(4)(b) of the GSE Act cannot be taken to amount to a constructive dismissal for the purposes of s 84(1) of the IR Act.
1. The respondent's submissions then traced the legislative history of subsection 69(4) of the GSE Act and concluded that the Commissioner erred in not finding that a proper and harmonious construction of the two statutory schemes requires a 'dismissal' in s 84 of the IR Act to exclude a resignation by an employee pursuant to s 69(4)(b) of the GSE Act.
2. The submissions then dealt with subsection 85(1) of the GSE Act which is in the following terms:
85 Operation of industrial relations and superannuation legislation
(1) This Act does not affect the operation of the Industrial Relations Act 1996. This subsection does not limit section 58 (Industrial or legal proceedings excluded) and section 74 (Excess employees—jurisdiction of Industrial Relations Commission).
1. This part of the respondent's submissions concluded that, in "this case, a harmonious construction of both statutes requires an interpretation of 'dismissal' in s 84(1) of the IR Act which does not disturb the elaborate statutory scheme in s 69(4) of the GSE Act which draws a sharp distinction between being afforded an opportunity to resign prior to termination in s 69(4)(b) of the GSE Act and the more severe penalty of terminating an employee's employment without affording them an opportunity to resign in s 69(4)(a) of the GSE Act. The general terms of s 85 of the GSE Act must yield to the proper construction of these specific provisions".
2. In support of ground 4 of the cross-appeal (at [51] above), the respondent relied upon the following submissions (footnotes omitted):
49. The fourth ground of appeal is that the Commissioner erred in concluding that, upon the Cross-Appellant giving the Cross-Respondent the opportunity to resign under s 69(4)(b) of the GSE Act, the Cross Respondent did not freely resign from his employment and was dismissed for the purposes of s 84(1) of the IR Act.
50. A dismissal occurs when an employee is "sent away or removed" from employment by the employer without the employee's consent.
51. However, there is case law indicating that, in some circumstances, a resignation by an employee may constitute a dismissal where the employee is forced to resign. As the Full Bench of the Commission stated in Allison v Bega Valley Council (1995) 63 IR 68 (Allison) (at 72):
there are cases where the courts, after analysis, have determined that although the employee has resigned, and brought about the termination of the contract of employment, in reality the conduct of the employer has compelled or unduly influenced the employee to resign.
The most quoted example is an assertion by an employer to an employee to the effect that the employee must resign or he or she will be dismissed. This situation is commonly referred to in the decided cases as a "constructive dismissal", that is in effect the employer has brought about the termination of the contract of employment.
(emphasis added)
52. Recently, the decision in Samantha Hudson v Transport for NSW [2019] FWC 390 (Hudson) acknowledged the clear distinction between constructive dismissal and exercising a statutory option to resign under the GSE Act. In that case, the Fair Work Commission (FWC) concluded that dismissal does not take place in circumstances where an employee has elected to exercise their statutory right to resign, as had occurred in this case.
53. In Hudson, the applicant filed an application with the FWC seeking a remedy under s. 773 of the Fair Work Act 2009 (Cth) for an allegedly unlawful termination. Ms Hudson submitted her resignation following notification of her underperformance, which had engaged the operation of s. 68 of the GSE Act.
54. While the applicant in Hudson attempted to argue that an unlawful termination had taken place in the form of a constructive dismissal, Sams DP disagreed and dismissed the proceedings for want of jurisdiction. His Honour made critical observations, including the following at [45] that:
the option to resign under s 68(2)(a) of the GSE Act does not import any consideration of the veracity and fairness or otherwise, of the decision taken by the employer to terminate the employee's employment. The right to do so is a statutory right which does not require justification, or consideration of whether the employee disputes the allegations against her, or challenges the procedures taken and the dismissal decision... '
55. His Honour referred to O'Meara v Stanley Works Pty Ltd (PR973462), in which the Full Bench of the Australian Industrial Relations Court stated:
In our view the full statement of reasons in Mohazab which we have set out together with the further explanation by Moore J in Rheinberger and the decisions of Full Benches of this Commission in Pawel and ABB Engineering require that there to be some action on the part of the employer which is either intended to bring the employment to an end or has the probable result of bringing the employment relationship to an end. It is not simply a question of whether "the act of the employer [resulted] directly or consequentially in the termination of the employment". Decisions which adopt the shorter formulation of the reasons for decision should be treated with some caution as they may not give full weight to the decision in Mohazab. In determining whether a termination was at the initiative of the employer an objective analysis of the employer's conduct is required to determine whether it was of such a nature that resignation was the probable result or that the appellant had no effective or real choice but to resign.
56. Sams DP went on to observe (at [54]) that it was, "not true that the applicant had no option, other than resignation. The option which would have obviously avoided this jurisdictional objection, would be to have been dismissed... The decision to resign was hers, and hers alone". His Honour had regard (at [55]) to the applicant's evidence, in which it was apparent that she had "balanced the benefits of resignation", and as a result, her resignation was a "considered and deliberate exercise of her right to resign rather than be dismissed".
57. Sams DP concluded (at [58]-[59]), in dismissing the application for relief for want of jurisdiction:
In coming to the heart of the matter, it must be said, contrary to the applicant's submission, that resignation is self-evidently a preferable option than dismissal based on unsatisfactory performance. The benefits are obvious; a person will carry their employment record throughout their working life. Resigning from a position during this journey means the ignominy of dismissal, even if the employee strongly denies the reasons for it, should not impact on the likelihood of obtaining alternative employment. ...
It should also be observed that in this case, public sector employees in New South Wales have a statutorily enshrined right to resign, rather than face dismissal. This is not an automatic right available to a private sector employee, being an alternative dismissal for cause. This is why, in many cases of unfair dismissal which comes before the Commission, and where a settlement is negotiated, there is often a request from an applicant (often agreed to) to convert a dismissal to a resignation, even when the dismissed employee has already obtained alternative employment.
58. Save for the fact that the resignation occurred under s 68(2)(a) rather than s 69(4)(b), which is in precisely the same terms, Hudson is on all fours with the circumstances that faced the Commission and there is a striking inconsistency between the two decisions.
59. While the Cross-Respondent was squarely put on notice that, if his resignation was not forthcoming, he would be dismissed, there was no coercion on the part of the CrossAppellant or any of its officers. At no stage did any person threaten or unduly pressure the Cross-Respondent to choose to resign.
60. The Commissioner erred by failing to consider the proper question, which is whether, in reality the conduct of the employer has compelled or unduly influenced the employee to resign. Not only can the Cross-Respondent not point to any evidence of such "undue pressure", but the evidence before the Commission was that the Cross-Respondent was advised of the benefits associated with resigning in favour of being dismissed and sought advice from the union prior to tendering his resignation.
61. The Cross-Respondent's resignation letter also does not reveal any language of compulsion or force to resign. He expressly noted his desire to try to find work with another organisation which a resignation rather than a dismissal would assist him to do. The resignation letter was a considered and deliberate exercise of the CrossRespondent's statutory right to resign, rather than be dismissed. It is incontrovertible that he exercised a choice to resign.
62. The Cross-Respondent's resignation more squarely falls within the category of cases where the resultant resignation may be said to be given freely and without any undue influence being brought to bear by the employer and the Commission's finding that there had been a 'dismissal' for the purposes of s 84(1) of the IR Act is demonstrably incorrect.
1. In the respondent's submissions in reply reference was made to the judgement of Simpson AJ in NSW Commissioner of Police v Cottle [2019] NSWSC 1588. It was submitted that Commissioner Constant had erred in her construction of section 85 of the GSE Act because the general words used in section 85 must yield to the proper interpretation to be given to the specific provision of subsection 69(4)(b) of the GSE Act.
2. The respondent's reply submissions then continued as follows (footnotes omitted):
7. Indeed, s 85 of the GSE Act arguably has a narrower interpretation than s 218 of the Police Act. Section 218(1) of the Police Act provides: "The Industrial Relations Act 1996 is not affected by anything in this Act." By contrast, s 85(1) of the GSE Act relevantly provides that "This Act does not affect the operation of the Industrial Relations Act 1996" (emphasis added). The word "operation" makes clear that s 85(1) is directed to preserving the mechanics of the IR Act but does not apply where it is especially restricted by a specific provision of the GSE Act, such as the disciplinary scheme established by s 69(4) of the GSE Act.
8. The GSE Act creates a specific coherent and comprehensive scheme in relation to the management of unsatisfactory performance and misconduct. There are three critical features to the scheme:
a. The development and implementation of a performance management system with respect to employees under ss 67(1) and (2) of the GSE Act and Pt 7 of the GSE Rules;
b. The establishment and implementation of procedural requirements in dealing with employee misconduct under s 69(3)(b) of the GSE Act and Pt 8 of the GSE Rules; and
c. In the event that, after the following the prescribed processes, the agency exercising employer functions determines that an employee has engaged in unsatisfactory performance (s 68(2)) or finds that an employee has engaged in misconduct (s 69(4)), the agency has a unilateral discretion to take a suite of different actions designed to address the matter including a reduction in the remuneration payable to the employee, a reduction in the classification or grade of the employee or being assigned to a different role or termination of employment (after having given the employee the opportunity to resign) or termination of employment (without having given an opportunity to resign).
9. As set out in paragraph [12]-[27] of the Cross-Appellant's submissions, there are aspects of the statutory scheme in the GSE Act which would be significantly impaired if the procedural requirements and range of actions available to an employer were to fall within the notion of a threatened dismissal or constructive dismissal. On the present state of the case law, steps taken as part of meeting the procedural requirements or steps taken short of an actual decision to terminate an employee's employment is capable of enlivening the Commission's jurisdiction under Pt 6 of Ch 2 of the IR Act.
10. So, for example, a threat of dismissal within the meaning of s 83(5)(a) ordinarily includes where an employee is the subject of disciplinary proceedings and dismissal is a potential outcome but a decision has not yet been made . As the GSE Rules require that an employee be notified that the employer is proposing to take specified action under s 68(2) or s 69(4) of the GSE Act before action is taken (GSE Rules, rr 36(1)(c), r 38(3) and 40(2)), it would ordinarily constitute a threat of dismissal enlivening the Commission's jurisdiction under Pt 6 Ch 2 of the IR Act.
11. Similarly, a 'constructive' dismissal may arise where an employee is demoted as a result of an employer's unilateral decision to reduce an employee's remuneration, rank, grade or position, seniority or status or a change in duties not authorised by the contract of employment or an applicable industrial instrument, notwithstanding that the employee may have continued in employment. The suite of actions available under s 68(2) in respect of unsatisfactory misconduct (sic performance) and s 69(4) in respect of misconduct includes a reduction in the remuneration payable to the employee, a reduction in the classification or grade of the employee or being assigned to a different role. Such action is not otherwise authorised (GSE Act, s 46(4)). To the extent that an employee has a grievance regarding a decision to reduce his or her remuneration, classification or grade, then Parliament has expressly provided that such a decision (IR Act, s 97(1)(b)) is capable of being appealed under Pt 7 of Ch 2 of the IR Act. A decision to dismiss under
s 97(1)(f) of the IR Act is a separate type of decision capable of being appealed. This suggests that the common law meaning of dismissal extending to demotions is not intended to apply.
12. The Cross-Appellant submits it would lead to anomalous and unintended outcomes if an employee were entitled to make an unfair dismissal application under Pt 6 of Ch 2 of the IR Act where an employer has merely taken an action authorised or required under the GSE Act. It would have the incongruous effect of permitting an employee to frustrate or inhibit an employer from taking action against an employee designed to provide that employee with an opportunity to respond to allegations in accordance with the rules or taking disciplinary action short of a conscious decision to terminate employment or to take action which forces an employee to resign.
13. Support for this construction emerges from the decision of Chief Commissioner Kite in Mikhail Karem-AI Fidawy v The Sydney Opera House Trust, when he found that a demotion made pursuant to s 69(4) of the GSE Act was not a 'dismissal' for the purposes of s 84 of the IR Act. At [26]-[28], the Chief Commissioner said:
The principles of statutory construction, recently revisited in Kaldas v Barbour [2017] NSWCA 275 (Bathurst CJ at [116]), include a requirement:
that the statute must be read as a whole on the prima facie basis that its provisions are intended to give effect to harmonious goals: Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355; [1998] HCA 28 at [70]; Plaintiff S4/2014 v Minister for Immigration and Border Protection (2014) 253 CLR 219; [2014] HCA 34 at [42].
There is no justification to construe "dismissal" in s 84 differently from the way that word is used in s 97(1) at least in relation to a public sector employee. I am reinforced in that view by the terms of s 84[3](5)(b) of the Act. Although the definition is expressed to be inclusive, in my view it is clear that the concept of dismissal for public sector employees is confined to termination of the employment.
I conclude therefore that a reduction in grade (or demotion) in accordance with s 69(4) of the GSE Act is not a dismissal within the meaning of s 84 of the Act.
14. As set out in the Cross-Appellant's submissions at [32]-[34], s 97(1) of the IR Act does not include termination after being given an opportunity to resign; it does include a direction requiring an employee to resign. Accordingly, there is therefore no justification for construing the term 'dismissal' in s 84 of the IR Act to include a decision to resign made in response to being given an opportunity to do so under s 69(4)(b) of the GSE Act.
15. A more coherent and intelligible scheme is that dismissal is limited to an employer's decision under the GSE Act to terminate an employee's employment by making of a written instrument under s 47 of the GSE Act or by coercion or undue pressure to resign. It does not apply to actions taken authorised by or in compliance with the GSE Act including giving the employee the opportunity to resign before termination of employment.
16. In response to [8] of the Cross-Respondent's submissions, it is not correct that the Cross-Appellant's letter of 31 May 2018 resulted in the cessation of the employment relationship. Rather, the opportunity to resign was provided as one of the suite of actions available pursuant to s 69(4)(b) of the GSE Act. It was the Cross-Respondent's decision to resign which resulted in the termination of employment.
17. In response to [9] of the Cross-Respondent's submissions it is not necessary to find whether there is a repugnancy between two statutes giving rise to an implied repeal of the earlier statute before construing the two related statutes harmoniously. The proper approach is the inverse: see the Cross-Appellant's submissions at [13].
Resignation without coercion or pressure
18. In response to [14]-[15] of the Cross-Respondent's submissions, there is no substantial difference between the situation confronting the Fair Work Commission in Samantha Hudson v Transport for NSW [2019] FWC 390 (Hudson) and the circumstances of this case other than that the opportunity to resign prior to employment being terminated provided to Ms Hudson was done pursuant to s 68 of the GSE Act regarding discipline for unsatisfactory performance rather than s 69 of the GSE Act regarding discipline for misconduct.
19. On the facts, Ms Hudson faced the same 'threat' of termination as the Cross-Appellant (sic Cross-Respondent) in this case and both chose to resign when given the opportunity to do so. Like in Hudson, there was no evidence before the Commission of any coercion or pressure and the Cross-Respondent has not pointed to any. In those circumstances, the correct conclusion is that the resignation was not forced and did not amount to a constructive dismissal.
Consideration
1. We reject the submissions of the respondent to the effect that there is incongruity or disharmony between section 69 of the GSE Act and the provisions of Part 6 of Chapter 2 of the IR Act ([12]-[27] at [53] above; [55]-[56] above; paragraphs 7-17 at [59] above). We reject these submissions for the reasons articulated by Commissioner Constant at [74]-[88] of the Decision.
2. We would add that the reliance placed by the respondent on the judgement of the High Court in Commissioner of Police v Eaton [2013] 252 CLR 1 is misplaced. Eaton dealt with an application made pursuant to section 84 of the IR Act by a dismissed probationary police constable. Unlike the GSE Act, the Police Act 1990 (NSW) contains a comprehensive suite of provisions which deal with orders for the disciplining or removal of police officers and for applications to this Commission for review of those orders. In addition, there is a provision that allows the Commissioner of Police to dismiss a probationary police officer at any time and without giving any reason (subsection 80(3)). In these circumstances, the High Court held that the unfair dismissal provisions of the IR Act had no application to the dismissal of a probationary police officer. Unlike the situation in Eaton, the GSE Act contains no provisions which allow for employees to seek redress from disciplinary action taken against them by their employer. These are found in Parts 6 and 7 of Chapter 2 of the IR Act.
3. With respect to what is put at paragraphs 8-9 of the respondent's reply submissions (at [59] above), the "specific coherent and comprehensive scheme" created by the GSE Act includes subsection 69(4) which sets out the different disciplinary actions which may be taken against an employee in the case of proven misconduct.
4. Subsection 69(4)(a) provides for the termination of the employment of the employee (without giving the employee an opportunity to resign). There is no dispute between the parties that, where this disciplinary action is taken, the affected employee may make an unfair dismissal application pursuant section 84 of the IR Act or, in the alternative, institute a public sector disciplinary appeal pursuant to section 98 of the IR Act.
5. Subsection 69(4)(b) provides for the termination the employment of the employee (after giving the employee an opportunity to resign). There is no dispute between the parties that, where this disciplinary action is taken, if the affected employee does not resign and is then dismissed, he or she may make an unfair dismissal application pursuant section 84 of the IR Act or, in the alternative, institute a public sector disciplinary appeal pursuant to section 98 of the IR Act.
6. Subsection 69(4)(c) provides for the imposition of a fine. Subsections 69(4)(d)-(e) provide for reduction in remuneration, classification or grade. In each of these circumstances, the affected employee may institute a public sector disciplinary appeal pursuant to section 98 of the IR Act because each of these disciplinary actions is an appealable decision under section 97 of the IR Act.
7. Subsections 69(4)(f)-(g) provide for non-appealable disciplinary actions.
8. It is not submitted by the respondent that there is any disharmony or incongruity between the operation of subsections 69(4)(a)-(e) of the GSE Act and the provisions of Parts 6 and 7 of Chapter 2 of the IR Act, apart from the situation where an employee who has been served with a notice pursuant to subsection 69(4)(b) resigns.
9. We fail to see how there is any disharmony between the operation of subsection 69(4)(b) of the GSE Act and the relevant provisions of the IR Act simply because the employee is given the opportunity to resign before being dismissed and does so. Section 83 of the IR Act defines "dismissal" to include the threat of dismissal and we have no doubt that a notice issued to an employee pursuant to subsection 69(4)(b) of the GSE Act constitutes a threat of dismissal. Further, the jurisprudence of this Commission has long held that, in certain circumstances, an employee who has resigned under threat of dismissal has been constructively dismissed. We reject the proposition that the two statutory schemes can operate harmoniously in the case of a dismissal (and other appealable disciplinary actions) but not in the case of a constructive dismissal.
10. Given the clear and undisputed interplay between the provisions of section 69 of the GSE Act and Parts 6 and 7 of Chapter 2 of the IR Act, we also fail to see how "there are aspects of the statutory scheme in the GSE Act which would be significantly impaired if the procedural requirements and range of actions available to an employer were to fall within the notion of a threatened dismissal or constructive dismissal" (respondent's reply submissions paragraph 9 at [59] above).
11. Reliance by the respondent on the decision of former Chief Commissioner Kite SC in Mikhail Karem-Al Fidawy v The Sydney Opera House Trust [2017] NSWIRComm 1077 is misplaced. In that matter, the respondent had taken disciplinary action against the applicant pursuant to subsections 69(4)(e) and (f) of the GSE Act by reducing his classification and grade and assigning him to a different role. In addition, the proposed new contract of employment provided to the applicant referred to his "Employment Status" as "Temporary". The Chief Commissioner at [28] concluded that a reduction in grade (or demotion) in accordance with subsection 69(4) of the GSE Act is not a dismissal within the meaning of section 84 of the IR Act. In addition, the Chief Commissioner at [30]-[31] concluded that the GSE Act and the Government Sector Employment (General) Rule 2013 ("GSE Rules") did not permit the respondent to change the employment status of an ongoing employee and, therefore, there was no threat of dismissal on the basis that the employment status was temporary.
12. In the present matter, the appellant was effectively told by the respondent "resign or be sacked". That is clearly a threat of dismissal. The next question to be determined is whether or not the resignation of the appellant in such circumstances was a constructive dismissal.
13. The respondent relies upon the decision of Sams DP of the Fair Work Commission in Samantha Hudson v Transport for NSW ([2019] FWC 390) to support the proposition that a resignation given by an employee who has been issued with a notice pursuant to subsection 69(4)(b) of the GSE Act and who resigns, has not been dismissed for the purposes of section 84 of the IR Act (see paragraphs 52-58 at [57] above).
14. In that matter, the applicant, who had resigned from her employment after receiving an unsatisfactory performance notice pursuant to subsection 68(2)(a) of the GSE Act (see [48] above), subsequently commenced proceedings in the Fair Work Commission pursuant to section 733 of the Fair Work Act 2009 (Cth) ("the FW Act") which allows for an application to be made to the Fair Work Commission to deal with a dispute about the termination of an employee's employment on the grounds set out in section 772 of the FW Act. The applicant in that matter claimed that the termination of her employment was unlawful because she had been discriminated against on the basis of her gender (subsection 772(1)(f) of the FW Act). The applicant claimed that she had no realistic option but to resign. The respondent argued before Sams DP that the applicant had not been dismissed at the initiative of the employer.
15. His Honour gave consideration to subsection 386(1) of the FW Act which is in the following terms:
Meaning of dismissed
(1) A person has been dismissed if:
(a) the person's employment with his or her employer has been terminated on the employer's initiative; or
(b) the person has resigned from his or her employment, but was forced to do so because of conduct, or a course of conduct, engaged in by his or her employer.
1. In his decision, his Honour stated:
[43] It must firstly be observed that applications under s 773 of the Act are not regularly encountered by the Commission. Given the limitation on the powers of the Commission to conduct a conference of the parties in an attempt to resolve the claim, there are few decisions of the Commission under the powers of the Commission to hear and determine the application, only by consent, of the parties. Less frequent, and even probably unique to this case, there are no decisions, let alone Full Bench authority of which I am aware, which have dealt with a jurisdictional objection of this kind. I am required to determine this matter under the unlawful termination of employment provisions of the Act. That said, and as I will come to in due course, the question of whether the application is beyond jurisdiction is, in my opinion, a relatively straightforward question, because the unlawful termination of employment provisions cannot apply if the applicant resigned voluntarily. This would mean that there could be no termination at the 'initiative of the employer'.
1. Sams DP then considered authorities in the federal jurisdiction on the issue of constructive dismissal and stated:
[54] In my view, there is an air of unreality about the applicant's submissions in this case. Firstly, it is not true that the applicant had no option, other than resignation. The option which would have obviously avoided this jurisdictional objection, would be to have been dismissed. She would then have had the option to dispute the allegations, challenge the process and seek remedies, including reinstatement, under either this section of the Act, the General Protections provisions, or in terms of her possible contractual rights in the Courts. The decision to resign was hers, and hers alone.
…………………………
[58] In coming to the heart of the matter, it must be said, contrary to the applicant's submission, that resignation is self-evidently a preferable option than dismissal based on unsatisfactory performance. The benefits are obvious; a person will carry their employment record throughout their working life. Resigning from a position during this journey means the ignominy of dismissal, even if the employee strongly denies the reasons for it, should not impact on the likelihood of obtaining alternative employment. When seeking future employment and the employee is asked why they left employment, they must be truthful about the reason. It goes without saying that such non-disclosure or falsehood could result in adverse consequences.
[59] It should also be observed that in this case, public sector employees in New South Wales have a statutorily enshrined right to resign, rather than face dismissal. This is not an automatic right available to a private sector employee, being an alternative to dismissal for cause. This is why, in many cases of unfair dismissal which come before the Commission, and where a settlement is negotiated, there is often a request from an applicant (often agreed to) to convert a dismissal to a resignation, even when the dismissed employee has already obtained alternative employment.
……………………………
[62] For all these reasons, I am satisfied that in the exercise of her right to resign under s 68(2) of the GSE Act, the applicant did so willingly and voluntarily, without coercion or pressure. Her termination of employment was not at the 'initiative of the employer' and she was not dismissed by Transport for New South Wales (Sydney Trains). It follows that the Commission has no jurisdiction to determine the matter.
1. With respect to this decision of the Fair Work Commission, the respondent in this matter submitted:
58. Save for the fact that the resignation occurred under s 68(2)(a) rather than s 69(4)(b), which is in precisely the same terms, Hudson is on all fours with the circumstances that faced the Commission and there is a striking inconsistency between the two decisions.
1. In this jurisdiction, it has long been held that an employee who resigns in the face of a threatened dismissal has been constructively dismissed. The decision of the Full Bench in Allison v Bega Valley Council has been cited with approval in this and other jurisdictions (see for example John Holland Pty Ltd v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union [2009] 180 IR 314 per Jessop J at [60]).
2. Allison was decided under the provisions of the Industrial Relations Act 1991 but the reasoning of the Full Bench in the passages set out below still holds good today:
Did the respondent dismiss the applicant?
The reference in s 246 to an employer dismissing an employee is a reference to the termination by an employer of the contract of employment of an employee. The language used in Pt 8 of Ch 3 of the Industrial Relations Act, which is entitled "Unfair Dismissals", accords with that which in our experience is utilised in employment situations throughout New South Wales. However for our purposes it is necessary to consider the use of this language against the background of the legal principles traditionally employed by courts and industrial tribunals when considering the termination of contracts of employment.
It is a trite observation that a contract of employment like any contract can come to an end in a number of ways. Termination can be "by" the employer where an employee is "dismissed" either with notice in accordance with the provisions of the contract or without notice in the event of serious and wilful misconduct. Both the employer and the employee may mutually agree that the contract of employment should come to an end. In other cases the employee may bring about the termination by resigning.
In some cases the circumstances in which the termination comes about makes it difficult to determine whether there was termination "by" the employer or the employee. There are cases where the courts, after analysis, have determined that although on the face of it an employee has resigned and brought about the termination of the contract of employment, in reality the conduct of the employer has compelled or unduly influenced the employee to resign. The most quoted example is an assertion by an employer to an employee to the effect that the employee must resign or he or she will be dismissed. This situation is commonly referred to in the text books and decided cases as a "constructive dismissal", that is in effect the employer has brought about the termination of the contract of employment.
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 the employee appears to have given his or her resignation?
……………………………
In order to undertake the necessary analysis it is necessary to look carefully at all the relevant facts. It is necessary to determine whether the actual determination was effectively initiated by the employer or by the employee particularly where the dynamics within a factual situation may change. For example, an employer may demand a resignation with a threat of dismissal, negotiations may then ensue and the employee may ultimately be genuinely pleased with the outcome of those negotiations to the extent that any resultant resignation may be said to be given freely and without any undue influence being brought to bear by the employer.
Where an employee initiates the termination of the contract of employment it is necessary to consider whether that ostensible act of termination was given freely and without any undue pressure. If the ostensible resignation is, in effect, a response to and consistent with a desire by an employer that such resignation be forthcoming, then what has occurred may be that the termination has been brought about by the employer and that in this way the employee has been dismissed.
The general principles which we have espoused are consistent with those adopted in decided cases.
In the Industrial Commission of New South Wales Macken J in Re Michaelis Bayley Trading Co and New South Wales Sales Representatives and Commercial Travellers' Guild Re Dismissal [1979] AR 392 said at 393:
" … Mr Gale was given the alternative of accepting an offer to resign or being dismissed from the company. It was suggested that this concession was made having regard to his 40 years of service with the company.
…
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 of threat — so, too, it must be terminated by a resignation equally untainted by any such threat. Where a contract is terminated otherwise, it amounts to constructive dismissal.
Predictably, Mr Shaw relied upon the unbroken chain of 'resign or be sacked' authorities, in particular, Stephenson v London Joint Stock Bank (Ltd) (1903) 20 TLR 8 and Coenen v South England Tyre Service Ltd (1971) 61 TR 41.
There is no doubt in my mind that Mr Gale was constructively dismissed and that an obligation rested upon the commissioner to proceed to a hearing of the merits of the claim. To that extent his decision was wrong."
………………………………
We were referred also to R v Prince Alfred College (1979) 46 SAIR 598 a decision of Olsson P (as he then was) in the South Australian Industrial Court. In discussing the question of constructive dismissal his Honour said (at 614-617):
"The so-called doctrine of constructive dismissal has re-emerged and developed rapidly of recent times. Perhaps the most helpful authorities on the topic are to be found in the published reports of the English tribunals. Of these one of the leading decisions is the judgment of the Employment Appeal Tribunal in Sheffield v Oxford Controls Co Ltd (1979) IRLR 133 (Sheffield's case).
The facts then before the tribunal are summarised in the headnote to the report in the following terms:
'The appellant was employed as a director of the respondent company. His wife was also employed by the company. On 31 January 1977, there was a disagreement between the appellant's wife and the controlling shareholders of the company. Mrs Sheffield was told that she would have to leave the company and Mr Sheffield responded by stating "if she goes, I go". This led to Mr Sheffield being asked how much he wanted to go. He replied 10,000 (pounds). It was said that the company could not pay that all at one time and the meeting broke up. A letter was written to the appellant threatening him that if he did not resign he would be dismissed. He was shown this letter and threatened verbally. Later that day, an agreement was prepared which set out the terms on which Mr Sheffield was prepared to resign. Mr Sheffield and the respondents initialled the agreement and his employment terminated. He claimed unfair dismissal compensation.
An Industrial Tribunal found that Mr Sheffield had not been dismissed in law.'
In the tribunal's reasons for decision Arnold J, having recited the full factual circumstances, reviewed the major decisions published to that time dealing with the doctrine of constructive dismissal. In so doing, he pointed out that virtually all of them arose out of factual circumstances in which the employer indicated to the employee that, if the latter did not resign, then he or she would be dismissed.
In summarising the views of the members of the tribunal, Arnold J discussed the principle involved in these terms:
' … It is plain, we think, that there must exist a principle, exemplified by the four cases to which we have referred, that where an employee resigns and that resignation is determined upon by him because he prefers to resign rather than to be dismissed (the alternative having been expressed to him by the employer in the terms of the threat that if he does not resign he will be dismissed), the mechanics of the resignation do not cause that to be other than a dismissal. The cases do not in terms go further than that. We find the principle to be one of causation. In cases such as that which we have just hypothesised, and those reported, the causation is the threat. It is the existence of the threat which causes the employee to be willing to sign, and to sign, a resignation later or to be willing to give, and to give, the oral resignation. But where that willingness is brought about by other considerations and the actual causation of the resignation is no longer the threat which has been made but is the state of mind of the resigning employee, that he is willing and content to resign on the terms which he has negotiated and which are satisfactory to him, then we think there is no room for the principle to be derived from the decided cases. In such a case he resigns because he is willing to resign as the result of being offered terms which are to him satisfactory terms on which to resign. He is no longer impelled or compelled by the threat of dismissal to resign, but a new matter has come into the history, namely that he has been brought into a condition of mind in which the threat is no longer the operative factor of his decision; it has been replaced by the emergence of terms which are satisfactory. Therefore we think that the finding that Mr Sheffield had agreed to terms upon which he was prepared to agree to terminate his employment with the company — terms which were satisfactory to him — means that there is no room for the principle and that it is impossible to upset the conclusion of the tribunal that he was not dismissed.'
Strangely enough, there does not appear to be a great deal of recent reported Australian authority on this topic, although the judgment of Macken J in the New South Wales decision of Re David Jones Ltd and the Australian Workers' Union; Re Levette [1978] AR 206 does contain a dictum which is in strong accord with the approach in Sheffield's case.
In my view, the dicta contained in Sheffield's case, with respect, accurately summarise the relevant principles of law applicable to the case now before me, and I am content to adopt them.
There is, as I see it, a fundamental factual difference between the situation which arose in Sheffield's case and that now before me. In the case at bar there is no suggestion that the applicant terminated his employment after negotiation of terms which were satisfactory to him. Nothing changed from the moment of actual original dismissal to the time of alleged constructive dismissal — other than the fact that the employer permitted the substitution of a resignation for the dismissal which had preceded it.
There is no doubt, as Mr Bollen QC for the respondent suggested, that in tendering his resignation the applicant meant what he said. But in substance and in fact he had no real choice in the matter. The substitution of the resignation for the dismissal was simply, as it were, an act of clemency accorded him by the respondent; so as to minimise the prejudice to him in obtaining other employment later on.
Viewed realistically, the applicant was in exactly the same position as at the time when he tendered his resignation as he would have been if the employer had said to him: 'We will dismiss you if you do not resign of your own accord.' The fact that the act of resignation subsumed the act of dismissal does not alter the essential character of the transactions between the parties. By virtue of the implicit waiver of the original act of formal dismissal by the employer, the applicant was, in reality, in a position in which he had resigned because he had been given virtually no option but to do so — on pain of the formal dismissal remaining in force and acting to his prejudice at a later point of time.
For these reasons I am compelled to the view that, at the time at which his employment was terminated, the applicant was constructively dismissed by the respondent."
In each of the cases cited above the facts involved a resignation in the face of a threat of dismissal by the employer. We note that in Sheffield v Oxford Controls, cited by Olsson P, Arnold J said: "The cases do not in terms go further than that."
However, we do not regard anything said in any of these cases as confining the ability to characterise a termination involving a resignation made by an employee as a dismissal by the employer to circumstances where the choice is a threat of dismissal or resignation. What is important is the significance of the threat made by the employer as it impacts upon the resignation of the employee. In the examples given, particularly in the extract from the decision of Arnold J, the threat is no longer a significant factor or alternatively the employee no longer regards the threat as a significant factor.
1. The Full Bench in Allison went on to find that the appellant in that case, despite there having been no threat by the employer to dismiss him, had resigned and "that the real and effective cause of the termination of Mr Allison's employment was the conduct of the employer" (at p 76). For present purposes, the decision in Allison, which was cited by Commissioner Constant at some length in the Decision, and the authorities cited by the Full Bench therein, are consistent applying the principle that a resignation given in the face of a threatened dismissal amounts to a constructive dismissal.
2. As was the situation before Olsson P in R v Royal Alfred College [1979] 46 SAIR 598, there is no suggestion that the appellant in the present matter terminated his employment after negotiation of terms which were satisfactory to him.
3. Further, it does not matter that the employee resigned after being given the alternative of accepting an "offer" or "opportunity" to resign or being dismissed, as occurred in Re Michaelis Bayley Trading Co and New South Wales Sales Representatives and Commercial Travellers' Guild Re Dismissal [1979] AR 392 and in the present matter. It is still a constructive dismissal.
4. We see no basis for reaching a different conclusion simply because the "opportunity" to resign was given pursuant to a statutory provision which set out the range of disciplinary actions that can be taken against an employee for misconduct (subsection 69(4)(b) of the GSE Act). It is still a case of "resign or be sacked" which is the classic formulation for a constructive dismissal.
5. To the extent that the conclusion we have reached in this matter is inconsistent with that reached by Sams DP in Hudson, we respectfully disagree with his Honour's reasoning and conclusion in that matter.
6. On the basis that we have found that the appellant was constructively dismissed by the respondent, the cross-appeal must be dismissed.
Orders
1. In this matter the Full Bench makes the following Orders:
1. In the Application for Leave to Appeal and Appeal by Roland Zopf, leave to appeal is refused.
2. In the Application for Leave to Cross-Appeal and Appeal by the Industrial Relations Secretary on behalf of the Department of Customer Service, leave to cross-appeal is granted and the cross-appeal is dismissed.
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Amendments
26 March 2020 - -
21 April 2020 - correct decision uploaded
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Decision last updated: 21 April 2020
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