Re James Flynn v JC Hutton Pty Ltd [1982] FCA 239; 2 IR 413 (25 November 1982)

FEDERAL COURT OF AUSTRALIA

Re: JAMES FLYNN
And: J.C. HUTTON PTY. LTD.
No. V28 of 1982
Industrial Law
2 IR 413

COURT

IN THE FEDERAL COURT OF AUSTRALIA
VICTORIA DISTRICT REGISTRY
INDUSTRIAL DIVISION
Keely J.

CATCHWORDS

Industrial Law - alleged breaches of award - summary dismissal - whether conduct amounted to "misconduct" - necessity for penalty to be sufficiently high to deter breaches

HEARING

MELBOURNE
25:11:1982

DECISION

This is an application by James Flynn (the applicant) under s. 119 of the Conciliation and Arbitration Act 1904 (the Act) for penalties to be imposed upon J.C. Hutton Pty. Ltd. (the respondent) for two alleged breaches of the Victorian Meatworks and By-products Agreement-Award 1978 (the award) at its Kyneton premises. The applicant was employed there as a slaughterman for a period from a date no later than March 1976 until 7 July, 1981 and was both a member of and a works delegate for the Australian Meat Industry Employees' Union (the union). The first allegation is that the respondent failed to provide to the applicant clean head coverings daily as required by clause B27 of the award during the period from March 1976 up to and including 25 June, 1981.

The evidence of Mr. Wilson showed that the respondent used to provide rag hats to the employees including those in the slaughtering area. The hats, together with other items of clothing, were collected by the employees before commencing work and returned to a laundry bin after work. In 1974 the respondent changed that system to one in which the employees were given the use of "bump hats" made of hard plastic but the employees were required to clean them with soap and water. The employees kept those hats in their lockers and had to pay for them if they lost them. The slaughtermen had a great deal of difficulty with these bump hats. They did not have chin straps and used to fall off and they were uncomfortable in the humid conditions in the area. After about two weeks the slaughtermen asked the respondent for the rag hats to be returned to them but were told by the respondent that they cost too much to launder. After some discussion as to the unsuitability of the bump hats the respondent agreed to issue two rag hats to each slaughterman but on the basis that each employee would be responsible for laundering the rag hats. In time the two hats supplied by the respondent wore out and the employees bought new rag hats and returned the two old rag hats and the bump hat to the respondent so as to have them "struck off" their property sheet.

There was little conflict of evidence in the case except as to whether the applicant was wearing a hat after the smoko on the morning of 7 July, 1981 - a matter referred to later. Where there is any conflict I accept the evidence given by the applicant and the witnesses called on his behalf. I am quite satisfied on the evidence that the respondent breached the clause in the way alleged from March 1976 until approximately two weeks before 7 July, 1981.

The second alleged breach was that the respondent failed to pay to the applicant moneys payable to him under clause B20 of the award, as an amount due in respect of his annual leave loading and an amount due under clause B21 of the award in respect of his entitlement to a pro rata payment in lieu of long service leave. It was common ground that neither of those amounts had been paid to him by the respondent and that the amounts in question were $110-13 and $1,492-00 respectively but the respondent denied that there was any entitlement to either amount because it contended that the applicant was dismissed summarily for misconduct. Mr. Porter conceded that the onus of proving that grounds existed for such summary dismissal lay on the respondent (see North v Television Corporation Ltd. (1976) 11 A.L.R. 599 at 602 per Smithers and Evatt JJ.). He did not seek to draw any distinction, for the purpose of these proceedings, between "serious and wilful misconduct", in clause B21(B)(iii) of the award, and "misconduct" in clause B20(M)(ii) - nor have I found it necessary to do so.

The conduct alleged to constitute "misconduct" occurred on 7 July, 1981 but must be considered in the light of certain earlier events. It was common ground that for some time before 7 July, 1981 it had been the practice of the respondent to supply waterproof boots free of charge to slaughterers - although the award did not require it to do so. Shortly before 7 July, 1981 Mr. Downie, the manager, decided to discontinue that practice but neither he nor anyone else on the respondent's behalf discussed the matter with the employees or gave them any notice of that change of practice.

The change in practice did not become known to the employees until after work commenced on 7 July, 1981. Mr. Moloney, who was working as a slaughterman on the mutton "chain" (or line) where calves were being slaughtered, was wearing a boot which, by reason of a hole, was letting water in. On seeking replacement boots he was told by the storeman that he would have to pay for them. At the smoko shortly afterwards the employees considered this change of practice by the respondents and decided by a unanimous vote that those who were wearing hats supplied by themselves would take their hats off. They returned to the work area where the chain was started but was stopped almost immediately by the meat inspectors because they would not allow the slaughtering to proceed while most of the employees were not wearing head coverings.

Mr. Flynn told Mr. Warnock (the supervisor in the mutton slaughtering area) that "the men were willing to work but they were not going to wear their own hats, as the boots had been withdrawn from them they were going to work to the award in relation to the hats and they expected the company to supply hats". After various phone calls a situation developed in which the respondent told the employees that there were hats available at the storeroom but that the employees would not be paid for the time spent in going to get the hats. There appears to have been some lack of adequate communication within the respondent's organization; in the early stages of the discussions, Mr. Townsend, the national industrial relations officer of the respondent, "did not understand" that the attitude of the employees was that, because the respondent had without notice to them stopped supplying boots, they would in turn stop supplying their own hats. However Mr. Townsend accepted in his evidence that at one of two later discussions that morning (which occurred at About 10.15 a.m. or 11.00 a.m.) he had been told by Mr. Flynn that the men were willing to work but wanted the respondent to supply them with hats.

It was clear on the evidence that an employee of the respondent could have been sent to bring the hats from the store to the slaughtering area in a very short space of time. Had that happened the employees would have worked. Instead the respondent decided to have members of staff brought to Kyneton from Preston to help process the stock on the chain - and in due course to summarily dismiss all of the employees concerned. As Mr. Wilson said in cross-examination, he "did not believe that over such a small issue" the respondent would refuse to have the hats brought to the employees.

It is not for me to comment upon the industrial relations aspect of the respondent's attitude on that day. However, I am quite unable to accept the contention that in those circumstances the applicant - or any of the other employees working in the area - were guilty of misconduct. I accept the evidence that they were willing to work and they were at the chain in the correct positions to work. The new factor which prevented work from being carried out was the fact that the employees were no long prepared to use hats supplied by themselves. They were under no duty to do so and, as I have already found, the respondent was in breach of clause B27 of the award in relation to the supply of hats. The respondent having changed without notice its practice of supplying boots, in my opinion it was not misconduct for the employees to change without notice their practice of supplying and laundering their own head coverings. Those two changes in practice having become known after the commencement of work 7 July, 1981, in my opinion it was not misconduct for the employees to refuse to go to the storeroom to collect hats - having been told by the respondent that they would not be paid for the time taken to do so.

However, even if, contrary to my opinion, there was misconduct by the other employees, I accept Mr. Flynn's evidence that on 7 July, 1981 he and another employee, Mr. Joe Millard, both before the smoko and when they returned to the chain after the smoko, were wearing hats described as air force type hats which had been supplied by the respondent. As to the circumstances in which they obtained those hats he said ". . . for about a fortnight prior to 7 July, we asked for a hat every morning when we picked up our shirt and trousers, our other gear. We were not handed a hat, which is normal practice in any other works when you get your clean clothing, you are supplied with a hat. We had to ask for it and just asking for it did not get it. You had to say, 'come on, we want a hat' . . . The guy in the store used to hang out for a little while until he saw that we were determined to get it and he would give you a hat but he would not give it voluntarily and he would not give it without a fair bit of prompting . . . He would not give it voluntarily unless we prompted him pretty well". Mr. Wilson also gave evidence that Mr. Flynn was wearing a hat both before and after the smoko and Mr. Moloney gave evidence that on that day after the smoko Messrs. Flynn and Millard were wearing hats supplied by the respondent.

As to that question there was a conflict of evidence. Mr. Warnock said that he "believed" that Mr. Flynn did not have his hat on. Mr. Townsend, who was not present at the works at the time when the chain was stopped, said "Mr. Flynn, to my recollection I did not see wearing a hat". I accept the clear unequivocal statements that Mr. Flynn was wearing a hat at the time in preference to the evidence of Messrs. Warnock and Townsend which was somewhat less clear.

Mr. Cooney of counsel, for the applicant, made it clear that, in bringing the proceedings, Mr. Flynn was not seeking to obtain a decision that he personally - as distinct from the other employees who were also summarily dismissed on 7 July, 1981 - could not have been guilty of misconduct at the time because he was in fact wearing a hat. However, the evidence having been given, and it having been established that the applicant was wearing a hat at the time when the chain was stopped shortly after the morning smoko, it is quite impossible for the respondent to establish in these proceedings that Mr. Flynn was guilty of any misconduct at all - even if the actions at that time would have constituted misconduct. He was willing to work and he was wearing the hat supplied by the respondent.

As to the amount of penalties to be imposed there is no evidence that the respondent has previously breached any award. In considering the amount of the penalties, I adopt with respect what was said by Smithers and Evatt JJ., in the Australian Industrial Court in North v Television Corporation Ltd. (1976) 11 A.L.R. 599 at 612 :-

"It should be remembered, however, that it is undesirable that an employer should be encouraged to act on the basis that if he fails to obey an award the employee may not take action against him, and that if he does, he, the employer, will probably suffer no more than if he had obeyed the award."

I agree with their Honours' view that it is important that employers should not be under any misapprehension as to what is likely to happen if proceedings are taken in respect of a breach of an award.

Clause B27(A) required the respondent to "provide daily, free of charge . . . a clean head covering" to the applicant. On the evidence it discontinued its previous practice of complying with the clause - apparently because of the cost of laundering the rag hats. It made available bump hats but it failed to comply with the requirement that it supply them in a clean condition at the beginning of each work day. The breach was not due to inadvertence. It continued for a long time during which the respondent did not have to meet whatever cost would have been involved in cleaning them daily.

Mr. Porter submitted that the employees concerned had acquiesced over a period of time in this breach of the award. However, although the evidence of Mr. Wilson to which I have referred gave some support to that argument, Mr. Flynn gave evidence, which I accept, that numerous requests had been made to the respondent for the supply of head coverings - particularly over the period of nearly 12 months before 7 July, 1981. In this connection he said that some of the employees had neglected to launder their head coverings properly and had been threatened by Mr. Warnock, with dismissal from their employment because of the unclean condition of their head coverings. He stated that the requests for the respondent to supply the head coverings were made to Mr. Downie (the respondent's branch manager at Kyneton at the time) and Mr. Harvey (a plant supervisor) and that they said that they would "look into it and see what could be done" but that in fact nothing was done - although, as mentioned earlier, he and Mr. Millard succeeded in "prompting" the storeman into supplying them with hats for about a fortnight before 7 July, 1981. It was a serious breach of the award.

Although there was evidence from Mr. Freeman, a consulting engineer, as to the unsuitability of the bump hats for the work concerned, I shall assume for the purpose of considering penalty - without however deciding the question - that those hats were "head coverings" within the meaning of the clause. In all the circumstances in my opinion an appropriate penalty for this breach is $750-00.

The breach of failing to pay amounts payable to the applicant under clauses B20 and B21 of the award was in my opinion also a serious breach of the award. The power to summarily dismiss an employee is one which should only be exercised after a very careful consideration of the relevant circumstances and a proper investigation of the facts. Summary dismissal has very serious consequences for an employee. In this case the applicant has been wrongly denied the payment of two amounts totalling more then $1,600-00 as a result of the respondent's decision. In all the circumstances, including what Mr. Porter has put to me as to the circumstances at the works on 7 July, 1981, which he described as an impasse, I consider that an appropriate penalty is $650-00.

Mr. Flynn has had to issue proceedings in this Court and attend to give evidence in order to obtain an order that he should be paid those amounts. The Court has no power by reason of the terms of s. 197A of the Act to order the respondent to pay his costs. However, in the circumstances I consider it proper to make an order under s. 120 of the Act that the two penalties imposed be paid by the respondent to Mr. Flynn. I also order that the respondent pay to Mr. Flynn the amounts of $110-13 and $1,492-00 to which he was entitled under clauses B20 and B21 of the award.