Robert Lawrence and Attorney General's Department [2004] NSWIRComm 59 (19 March 2004)

Last Updated: 22 March 2004

NEW SOUTH WALES INDUSTRIAL RELATIONS COMMISSION

CITATION : Robert Lawrence and Attorney General's Department [2004] NSWIRComm 59

FILE NUMBER(S): 3864

HEARING DATE(S): 07/11/2003, 04/12/2003

DECISION DATE: 19/03/2004

PARTIES:

APPLICANT:

Robert Lawrence

RESPONDENT:

Attorney General's Department

JUDGMENT OF: Sams DP

LEGAL REPRESENTATIVES

APPLICANT:

Mr M Gibian of counsel

SOLICITORS:

Ms J Wright, Jones Staff & Co

RESPONDENT:

Mr G De Courcey, Crown Solicitors for the Attorney General's Department

CASES CITED: Australian Transport Officers' Association v Department of Motor Transport (1988) 25 IR 235

Bankstown City Council v Paris (1999) 93 IR 209

Bigg & Anor v NSW Police Service (1998) 80 IR 434

Blyth Chemicals Limited v Bushnell (1933) 49 CLR 66

Burge v NSW BHP Steel Pty Ltd (2001) 105 IR 325

Busways v Johnson (1994) 55 IR 255

Byrne & Anor v Australian Airlines (1995) 61 IR 32

Cementaid (NSW) Pty Ltd v Chambers (unreported, Supreme Court, Spender AJ, 29 March 1995)

Clarke v Metropolitan Meat Industry Board [1967] AR (NSW) 16

Concut Pty Ltd v Worrell and Anor (2000) 103 IR 160

D & R Commercial Pty Ltd v Flood (2002) 113 IR 344

Electricity Commission of New South Wales t/as Pacific Power v Crump (1993) 48 IR 296

Federated Municipal and Shire Council Employees' Union of Australia, New South Wales Division, on behalf of Bowman, and City of Sydney Council [2001] NSWIRComm 91

Franklins Ltd v Webb (1996) 72 IR 257

Hill v Department of Juvenile Justice [2000] NSWIRComm 128

Hivac Ltd v Park Royal Scientific Instruments Ltd [1946] 1 CH 169

Hollingsworth v Commissioner of Police (1997) 77 IR 339

Humphries and Cootamundra Ex-Services and Citizens Memorial Club Limited [2003] NSWIRComm 211

Laws v London Chronicle (Indicator Newspapers) Ltd [1959] 2 All ER 285

Hunt v Hornsby Shire Council [2001] NSWIRComm 242

John Lysaght (Australia) Limited and Federated Ironworkers' Association of Australia, New South Wales Division & Ors (1972) AILR 517

Outboard World v Muir (1993) 51 IR 167

Paris v Bankstown City Council [1999] NSWIRComm 10

Pastrycooks Employees, Biscuit Maker Employees & Flour and Sugar Goods Workers Union (NSW) v Gartrell White (No 3) (1990) 35 IR 70

Phillips v Foxall (1872) LR 7 QB 666

Police Association of New South Wales on behalf of Adam Tregonning, and New South Wales Police Service [2000] NSWIRComm 14

Price v Box Valley Pty Ltd (1999) 90 IR 480

Shop, Distributive & Allied Employees' Association v Jewel Food Stores (1987) 22 IR 1

Staal and Tupene and Health and Research Employees' Association of New South Wales (on behalf of Nagy and Others) and Western Sydney Area Health Service [2004] NSWIRComm 27

Standley and Electronics Boutique Pty Ltd (unreported, Sams DP, IRC98/4516, 18 March 1999)

Transport Workers' Union of Australia, New South Wales Branch, on behalf of Joseph Vallis, and TNT Australia Pty Limited, trading as TNT Express [2002] NSWIRComm 46

Wang v Crestell Industries Pty Ltd (1997) 73 IR 4

Western Suburbs District Ambulance Committee v Tipping (1957) AR (NSW) 273

Youssef and Western Sydney Area Health Service [2002] NSWIRComm 8

LEGISLATION CITED: Industrial Relations Act 1996

Public Sector Management Act 1988

Workers' Compensation Act 1987

JUDGMENT:

- 38 -

INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

CORAM: SAMS DP

19 March 2004

Matter No IRC03/3864

Robert Lawrence and Attorney General's Department

Application by Robert Lawrence re unfair dismissal pursuant to section 84 of the Industrial Relations Act 1996

DECISION

[2004] NSWIRComm 59

1 Robert Lawrence ('the applicant') was employed by the Attorney General's Department ('the respondent') as a Sheriff's Officer. He was based at Sutherland Local Court having commenced employment there in June 1998. During his employment, the applicant undertook part time security work at the Sutherland Hospital and the Caltex oil terminal in Birchgrove.

2 After about six weeks of commencing employment the applicant suffered a workplace injury and was unfit for work on a number of occasions in 1999, 2000 and 2001. Due to an administrative error, the applicant was overpaid workers' compensation payments of $5,572.22. The applicant requested that this amount be waived and the request was subsequently approved.

3 The applicant had continued to work his secondary employment whilst on workers' compensation. He claimed his doctors were aware of these duties and had confirmed that the type of work undertaken would not exacerbate his injury or impede his recovery. The applicant also claimed that his primary employer was well aware of his secondary employment. However, following a Departmental inquiry in 2002 the applicant was charged on 30 December 2002 with alleged breaches of discipline. Those charges were detailed as follows:

1. That on 9 March 2001 you were misleading in your Statutory Declaration to the Director-General in relation to your income when relying on financial hardship in relation to a salary over payment. The particulars are that:

i. Between 22 May, 2000 and December, 2000 you were paid a full salary and not the Statutory Rate applicable under the provisions of the Worker's Compensation Act, 1987. A portion of the overpayment was offset by make-up pay (recreation/long service leave) leaving an overpayment balance of $5,572.22. In your submission to the Director-General seeking that the overpayment be waived you failed to inform him that you were engaged in secondary employment with Satinvale Associates at the same time as you were receiving workers' compensation benefits and during the period the overpayment occurred. In a private discussion with the Director-General at Sutherland in February 2001, you again failed to inform him that you were engaged in secondary employment with Satinvale Associates.

Your actions were in breach of the Department's Code of Conduct and Ethics.

2. That since 9 January 1999, you engaged in secondary employment without the approval of the Director-General or his delegate. The particulars are that:

i. you engaged in secondary employment with the South Eastern Sydney Area Health Service between 9 January and 14 November 1999 as an on-call casual employee, undertaking security work.

ii. you engaged in secondary employment with Stylish Security Pty Ltd between March and September 1999 as a car park security officer; and

iii. You engaged in secondary employment with Satinvale Associated Pty Ltd between January 2000 and the present as a gatehouse keeper.

Your actions were in breach of the Department's Code of Conduct and Ethics and the Public Sector Management Act.

3. That between February 2000 and 13 February 2001, you undertook secondary employment with Satinvale Associates whilst in receipt of workers' compensation benefits and in breach of s57 of the Workers Compensation Act, 1987. The particulars are that:

i. you were certified medically unfit to return to your primary employment as a Sheriffs Office (sic) and you were in receipt of workers compensation benefits as a result.

ii. Between February, 2000 and 13 February, 2001, you worked on various occasion (sic) for Satinvale Associates as a gatekeeper at the Caltex site at Birchgrove NSW; and

iii. you failed to notify the insurer, as required under s57 (1)(a) or (b) that you had engaged in secondary employment or that there had been change to your earnings.

Your actions were in breach of the Department's Code of Conduct and Ethics, the Public Sector Management Act and the Workers's Commensuration Court (sic), 1987.

4. That from 14 February, 2001 you exposed yourself to further injury during your structured Return to Work program by engaging in secondary employment on various occasions with Satinvale Associates which was outside the terms of the Return to Work Program and occurred without the approval or knowledge of the Sheriff's Office Rehabilitation Co-Ordinator, the insurer's Rehabilitation Consultant or your immediate supervisor. The particulars are that:

i. you continued to work on various occasions with Satinvale Associates as a gatekeeper at the Caltex sit (sic) at Birchgrove NSW;

ii. the work you undertook was outside the scope of the duties identified by your treating physicians (ie Clerical or administrative duties) and exposed you to potential danger and further injury from either intruders or fire.

This was contrary to the Department's Code of Conduct and Ethics, Public Sector Management Act and the Workers Compensation Court (sic) 1987

5. That on 25 and 26 October 1999 you engaged in secondary employment with the South Eastern Sydney Area Health Service at the Caringbah and Sutherland Hospital when you were on paid sick leave from your primary employment with the Attorney General's Department. The particulars are that:

i. you submitted a medical certificate which stated you were unfit to attend for duty on 25 and 26 October. 1999 because of abdominal pains;

ii. on 25 and 26 October 1999 you attended the Caringbah and Sutherland Hospital in the course of your secondary employment and undertook a First Aid Course, a requirement of the duties you undertook at that workplace.

Your actions were in breach of the Department's Code of Conduct and Ethics and the Public Sector Management Act.

6. You failed to disclose to the Government Insurance Office your secondary employment with Satinvale Associates when completing a Questionnaire and Statutory Declaration on 4 April 2000 in relation to the calculation of the future workers' compensation benefits you were to receive. The particulars are that:

i. When you completed the questionnaire at page 3 of 5, in response to question, "Since you have been receiving workers' compensation benefits have you done any work for wages or salary" you recorded the answer "No".

ii. On 10 October, 2000 you disclosed to the insurer when you completed a further questionnaire and Statutory Declaration that you had engaged in secondary employment with Satinvale Associates since February, 2000, working one or two shifts per month for $200.00 per shift.

iii. During the financial years 1999/2000 and 2000/2001 you declared to the Commissioner of Taxation income earned with Satinvale Associates in the sum of $5,285 and $26,083 respectively.

Your actions were in breach of the Department's Code of Conduct and Ethics and the Worker's Compensation Act, 1987.

4 The applicant responded in writing to the allegations on 23 January 2003. On 8 May the Department informed the applicant that the charges had been proven and he had committed a breach of discipline within the meaning of s66(1) of the Public Sector Management Act 1988. He was invited to respond. The applicant appealed for leniency in a letter dated 13 May. He asked the respondent to have regard for his financial hardship and his explanation that he had never attempted to profit from deception or fraud. The applicant was dismissed on 23 June 2003.

5 The applicant's claim of unfair dismissal, pursuant to Pt 6 ch 2 of the Industrial Relations Act 1996 ('the Act') was lodged on 14 July 2003. Conciliation proceedings in the Commission were held on 18 August 2003. The matter was unable to be resolved and the Commission made a finding of unsuccessful conciliation in accordance with s87 of the Act. Two days of hearing were set and directions issued in preparation for the arbitration.

THE EVIDENCE

6 The applicant is married with two dependant children. He described a workplace accident he had in 1993, which left him unable to return to full time work for more than three years. This accident had placed significant financial hardship on his family and forced him to relocate from Sydney to the South Coast.

7 In 1996 the applicant had occasional casual security work patrolling the disused Caltex site at Birchgrove for a company known as Satinvale Associates ('Satinvale'). The applicant obtained a security licence and worked casually for Satinvale and two other companies on the South Coast. In March or April the applicant and his family moved to Engadine. He applied for a Sheriff's Officer position in May 1998.

8 The applicant deposed that during his interview for the position he had informed the interview panel that he was working for various security companies and intended to continue to do so for financial reasons. He believed he was interviewed by Nerida Johnson, the then New South Wales Sheriff, Mr Ken Holdgate, Area Manager, and one other person. (In oral evidence, he agreed Mr Holdgate may not have been present). The applicant said that no one on the interview panel said he couldn't work as a security officer. He said one of the members of the panel had said "your security licence and experience in that industry will assist you in your application for this position."

9 The applicant agreed that he had signed a document on 22 June 1998 which indicated that he had received, read and understood the Code of Conduct. The Code required that permission was necessary for secondary employment to be undertaken.

10 The applicant said that soon after commencing employment (4 August 1998) he was injured at work after he was struck during a compulsory self defence course during his induction training. He said that he was extremely worried that his injury might jeopardise his continued employment as a Sheriff's Officer.

11 Soon after taking up duties at Sutherland Local Court the applicant said he became aware that other Sheriff's Officers were engaged in secondary employment. The applicant assumed it was a common practice the Department was aware of, and accepted.

12 It was the applicant's evidence that he had no recollection of being advised that he was required to obtain written permission to undertake secondary employment and wasn't told of this requirement until a week before he was dismissed. He denied a suggestion that his manager, Mr Horton had told him to do so in 1999. The applicant said that had he been aware of the requirement, he would have done so.

13 In late December 1998 or early 1999, the applicant was asked by another Sheriff's Officer, Mr Allan Nassau, who was also working at Sutherland Hospital, whether he would be interested in working part time at the hospital. The applicant subsequently commenced employment at the hospital. Shortly after doing so, the applicant deposed that Mr Horton had asked him if the Department was aware he was working secondary employment. The applicant said he told Mr Horton the Department was aware, as he believed he had advised the panel members at his interview.

14 The applicant believed that Mr Horton knew he worked at the hospital. Phone calls would be made to the Sheriff's office from the hospital inquiring about the applicant's availability for a particular shift. The office secretary would take messages for him. The applicant believed he might have mentioned to Mr Horton on one occasion in the lunchroom that he worked on the weekends.

15 The applicant agreed that he continued to work his secondary employment during the disciplinary investigation. He claimed no one told him he couldn't do so.

16 The applicant deposed that, at no time during 1999, did he work for Sutherland Hospital while he was unfit to work for the Department. His last shift at the hospital was 14 November 1999. He could not continue at the hospital because of his medical condition. In November 1999 the applicant lodged a second compensation claim in which he disclosed his secondary employment at the hospital.

17 The applicant said he could not explain why the hospital records indicated that he had attended a first aid course at the hospital on 25 and 26 October 1999, while at the same time he had called in sick to the Department.

18 From March 1999 to September 1999 the applicant said he worked weekends as a car park security officer at Cronulla Leagues Club. During this time he was fit for duty as a Sheriff's Officer.

19 In January 2000, after being reviewed by a specialist, the applicant was diagnosed with a ruptured disc and fractured vertebrae. In 2000 he had two operations (June and November) and was unfit for duty as a Sheriff's Officer from 20 January 2000 to 19 December 2000.

20 The applicant deposed that throughout 2000 he had carried out work as a Gatekeeper for Satinvale - usually it was two shifts a month from 6.00am to 6.00pm on weekends. His duties were to patrol the property and to ensure the environmental integrity of the site as it had been closed and secured for seven or eight years. This meant he did not come into contact with the public. Nothing untoward happened during this time. If it had, he was instructed to notify the police or fire brigade or his supervisor. The applicant claimed that there was no risk involved. No one could enter the site, except over a barbed wire fence. He operated from inside a locked environment in a gatehouse.

21 It was the applicant's evidence that he had consulted his doctors about this work and was advised that he was able to perform the work. He could take regular breaks, was not standing for long periods and was not required to lift anything.

22 On 4 April 2000, the applicant filled out a statutory declaration in which he said he had not undertaken any paid work whilst receiving workers' compensation payments. He couldn’t explain why he had answered the question incorrectly and said he was mistaken. He denied he was attempting to cover up his secondary employment.

23 In any event, he believed he had been consistently honest with the insurer, GIO and furthermore the GIO or the Department was entitled to recover any overpayments when he submitted all his income records to the District Court (during his workers' compensation case). Six months later, the applicant filled in another document in which he acknowledged working secondary employment.

24 The applicant deposed that on a number of occasions in 2000 and 2001 he had contacted Mr Peter Long, Chairperson, Sheriff's Officers' Vocational Branch Advisory Group to obtain Mr Long's assistance to return to light duties.

25 From 19 December 2000 to 19 January 2001 the applicant was certified fit for restructured duties, but did not return to work pending the development of a Return to Work Program. From 19 January 2001 to 4 February 2001 the applicant was deemed unfit to resume normal duties. On 5 February, the applicant was fit to return to restricted duties and he did so from 14 February to 30 April 2001 in accordance with the Return to Work Program. He worked three days a week, four hours a day carrying out clerical duties at the Sutherland Local Court.

26 The applicant was not to wear a uniform, not to lift heavy objects or placed in circumstances where he might be required to apprehend a person. The applicant commenced full time work carrying out clerical duties on 30 April 2001 until he was dismissed. However, he was certified fit to return to full time Sheriff's duties in September 2002.

27 In December 2000, the applicant was informed that he had been overpaid workers' compensation payments of nearly $10,000. This outstanding debt was later recalculated at $5,572.22. As he was still struggling financially, the applicant approached his Union, the Public Service Association ('PSA') and was advised that he could request a waiver of the debt on financial hardship grounds. The request was made by statutory declaration. The applicant said that no one advised him what information to include in the statutory declaration. He agreed he had not mentioned that he was undertaking secondary employment. However, he said the form had not asked for details of what he had earned. The request was denied on 6 May 2001. The PSA took up the matter with the Attorney General.

28 The Director General of the Department, Mr Laurie Glanfield, happened to be visiting Sutherland Local Court in February 2002. Mr Glanfield invited staff to raise any issues with him. The applicant told him of his waiver request which had been refused. Mr Glanfield said he would look into the matter. Subsequently the applicant was informed that the request had been approved after a review of his statutory declaration. The applicant did not believe he had misled Mr Glanfield. He simply believed the Department had made a mistake.

29 The applicant is currently employed as a store person on a net wage of $572.00 a week for a thirty-eight hour week. He also continues to work for Satinvale.

30 Dr Mark A Davies was the applicant's treating neurosurgeon. He had performed two operations on the applicant. He said there had been an improvement in the applicant's condition about five months after the second operation. Dr Davies provided a comprehensive report on the applicant's medical condition from 20 March 2000 to 24 March 2001. In a letter to the applicant's solicitor dated 15 October 2003, Dr Davies said:

I have not seen Mr Lawrence since 23.4.01. I was not aware that he was engaged in secondary employment as a Gatekeeper for Satinvale Associates. I did not receive the "attached" letter mentioned in point 2 on page 2 of your letter dated 18/9/03. In general, however, providing the security guard/gatekeeper work did not require regular heavy upper body work, violent twisting, jumping etc. AND was predominantly clerical and involved some minor physical activity, it is reasonable for him to perform this work. His previous position at the Downing Centre posed a real threat as there was the regular and realised threat of violent uncontrolled neck and upper body activity. This situation is quite different.

31 Dr Davies deposed that he understood the work of Sheriff's Officers involved dealing with offenders in the court system who might be unco-operative. Officers might be attacked or involved in violent incidents. Dr Davies regarded this work as posing a risk to the applicant. It was why he recommended administrative or clerical duties in August 2000. The Doctor said his comments in the report were designed to apply a common sense approach to the applicant's situation. In April 2001, Dr Davies had recommended minimising the applicant's train travel to minimise exacerbating his injury.

32 Dr Davies confirmed in oral evidence that, at no time, did the applicant inform him that he was working for Satinvale as a gatekeeper or security guard. The applicant believed Dr Davies was wrong and that he had told him about the nature of the security work.

Respondent's Evidence

33 Very short affidavit evidence was provided by Mr Horton and Mr Holdgate. The thrust of Mr Horton's evidence was that the applicant failed to tell him of his secondary employment or that he was working whilst on workers' compensation. The only point made by Mr Holdgate was that he was not a member of the interview panel which interviewed the applicant in 1998.

34 Mr Horton has been the officer in charge at Sutherland Court for fifteen years. In oral evidence, Mr Horton said he had been the officer in charge of the applicant and was aware of the allegations against him. Mr Horton acknowledged that he had not been interviewed as part of the investigation process.

35 Mr Horton claimed that the applicant had failed to tell him five years ago about his secondary employment. He said that his memory was vague, but his recollection was that he had found out from other staff. Mr Horton could not be sure that he spoke to the Regional Manager, Mr Holdgate, about the matter. Mr Horton said he could not recollect if the applicant had mentioned his secondary employment in the lunchroom.

36 Mr Horton agreed that it was not unusual for a Sheriff's Officer to undertake secondary security work on weekends. He had been aware Mr Nassau and the applicant were working at Sutherland Hospital in 1999. He conceded that there was nothing wrong with them undertaking this work. Mr Horton believed that Mr Nassau had permission to do so.

37 Mr Horton recalled a conversation he had with the applicant in 1999 when he had asked him if the Department was aware he was working on the weekend. Mr Horton conceded that the applicant had mentioned something about having disclosed it to the interview panel. Mr Horton said he phoned Mr Holdgate and informed him of the situation.

38 Mr Horton's evidence was that in 2001 the applicant had returned to work in the Court Registry, because appropriate duties couldn't be found as a Sheriff's Officer. He could only perform clerical work because of the risk of being in a physical or violent situation.

39 Mr Kenneth Holdgate is the Regional Manager, Sydney South Region, New South Wales, Sheriff's Office. He has worked for the Sheriff's Office for over fifteen years and has held his current position since 1996. Mr Holdgate said he was aware of the allegations against the applicant and had been interviewed by Mr McGrath, the Deputy Director, General Courts and Tribunal Services.

40 Mr Holdgate deposed that he had never sat on an interview panel with Ms Nerida Johnston and had not been a member of the applicant's interview panel. However, he did know who had been on the panel.

41 Mr Holdgate agreed that Mr Horton had told him in 1999 about the applicant's secondary employment. He conceded that he had not informed the Director General or the Director, Corporate Human Resources. Later in 2000, Mr Holdgate said he informed the Department's Workers' Compensation Unit.

SUBMISSIONS

For the applicant

42 After providing an overview of the factual background to the case and written submissions as to the relevant law, Mr Gibian of counsel addressed each of the allegations against the applicant in some detail. I shall deal with his submissions in the same way.

43 In respect to the first allegation, Mr Gibian noted that the overpayments of the applicant's workers' compensation benefits had been an error made by the Department. The applicant had never lied to the Department or the Director General. He had simply omitted to disclose that he was working for Satinvale. More importantly, however, no one from the Department or anyone else told him he was required to disclose his secondary employment; particularly as the request for waiving the debt had been first refused, reviewed and then approved.

44 Mr Gibian submitted that there was no general duty on an employee to disclose his or her faults or any aspect of his or her life which had not been asked by the employer. See Hollingsworth v Commissioner of Police (1997) 77 IR 339. He said that if the Department wanted more information, it should have asked for it. Moreover, there was no form to be completed seeking such information. The applicant was under no obligation to reveal "anything and everything." In any event, Mr Gibian added, the applicant had reasonable grounds for claiming financial hardship. He and his family were under severe financial pressure.

45 In respect to the second allegation, the applicant had acknowledged that he was engaged in secondary employment for three different companies. It was also acknowledged that written approval to do so was not sought. However, Mr Gibian said that the relevant section of the Public Sector Management Act does not disclose how an officer should seek permission to undertake secondary employment. He referred to s80 of the Act:

80 Officer not to engage in other employment without permission

(1) An officer shall not:

a) accept or continue to hold or discharge the duties of or be employed in any paid office in connection with any banking, insurance, mining, mercantile or other commercial business, whether it is carried on by a corporation, company, firm or individual, or

b) engage in or undertake any such business, whether as principal or agent, or

c) engage in or continue in the private practice of any profession, occupation or trade, or enter into any employment, whether remunerative or not, with any corporation, company, firm or individual so engaged,

except with the permission of the appropriate Department Head.

(2) The appropriate Department Head may withdraw any permission at any time.

(3) Subsections (1) and (2) are subject to any other Act that expressly applies to officers.

(4) If an officer:

a) is the holder of an office or position, or

b) is engaged in any employment whatever,

otherwise than in connection with the duties of the officer's position under the Crown, the officer must at once notify the fact to the appropriate Department Head.

(5) If an officer has given a notification to the appropriate Department Head under subsection (4), that Department Head may require the officer to resign the office or position or to abstain from engaging in the employment.

(6) Nothing in this section prevents an officer from accepting and continuing to hold office in any friendly society established for the benefit of public servants only.

(7) This section does not apply to chief executive officers or senior executive officers.

46 Mr Gibian stressed that there was nothing in the Act which prescribes a penalty for non disclosure of secondary employment is dismissal. Mr Gibian submitted that there was no breach of the applicant's duty to his primary employer by his undertaking of secondary employment. See Hivac Ltd v Park Royal Scientific Instruments Ltd [1946] 1 CH 169 and Cementaid (NSW) Pty Ltd v Chambers (unreported, Supreme Court, Spender AJ, 29 March 1995).

47 There was evidence of other officers undertaking secondary employment. Mr Gibian noted that the applicant had told the interview panel of his secondary employment. No one had told him he couldn't do so. Moreover, the applicant could not recall signing for the Code of Conduct, (although it was clear that he had). Indeed, the Code had not been put into the evidence.

48 Mr Gibian further observed that Mr Horton knew of the applicant's work at the Sutherland Hospital as far back as 1999 and did nothing about it. This evidence raised the notion of the employer's condonation of the employee's conduct. See Phillips v Foxall (1872) LR 7 QB 666, Australian Transport Officers' Association v Department of Motor Transport (1988) 25 IR 235, Burge v NSW BHP Steel Pty Ltd (2001) 105 IR 325 and Clarke v Metropolitan Meat Industry Board [1967] AR (NSW) 16.

49 In regard to the third allegation, Mr Gibian conceded that the applicant was working for Satinvale while on workers' compensation. This was not, he said, prohibited by the Workers' Compensation Act. Moreover, the applicant in a statutory declaration had informed the insurer on 5 November 1999. In any event, the respondent was aware he was doing so. In fact Mr Holdgate had told the Workers' Compensation Unit. Mr Gibian referred to Dr Davies' evidence that, while the applicant was unfit for Sheriff Officer's duties, he could perform the work he was engaged in for Satinvale.

50 As to the fourth allegation, Mr Gibian observed that the Return to Work Program was not put in evidence before the Commission. Relevant witnesses, such as the rehabilitation provider, the insurer and the Court Registrar were not called to give evidence. Mr Gibian submitted that this charge could not be made out.

51 As to the fifth allegation, Mr Gibian submitted that the only evidence before the Commission was the applicant's recollection of attending a first aid course at Sutherland Hospital, but he couldn't recall when. This was understandable given the time which had elapsed. Mr Gibian noted that the respondent produced no documents or records to prove this allegation.

52 In respect to the last allegation, Mr Gibian submitted that the applicant did not deliberately fail to disclose to the GIO that he was working secondary employment. He simply made a mistake. The employer and the insurer knew what he was doing. Mr Gibian said that, in any event, there was no overpayment.

53 Mr Gibian summarised his client's case by putting that the applicant's dismissal was 'harsh, unjust and unreasonable.' The applicant had had an unfortunate history which involved workplace injury and severe financial hardship. The respondent had failed to take this into account when it dismissed him.

54 The applicant sought compensation for unfair dismissal based on:

(a) the failure to give notice,

(b) the harshness of the dismissal,

(c) the applicant's financial hardship and distress, and

(d) additional hardship caused by the withdrawal of the waiver for the overpayment.

55 Mr Gibian said the applicant had been unemployed for seven weeks after dismissal and had been successful in obtaining alternative employment as a storeperson at about $570.00 net per week.

For the respondent

56 Mr De Courcey opened his submissions by putting that this case was not simply about the applicant's unauthorised secondary employment. The applicant had admitted attending a first aid course at Sutherland Hospital while on sick leave from the Department and couldn't explain why he had done so.

57 Mr De Courcey observed that the applicant's memory was inconsistent. He had said that Mr Holdgate was at his interview; then said he couldn't be sure. He acknowledged that written permission to undertake secondary employment was required; yet he had earlier deposed to being unaware of such a requirement. He claimed to be unaware of the Department's Code of Conduct; then accepted he had signed for it. These inconsistencies demonstrated, Mr De Courcey said, that the applicant changed his evidence to suit the particular circumstances.

58 Mr De Courcey asserted that the respondent did do something about the applicant's secondary employment. Mr Horton told Mr Holdgate, who then informed the Department's Workers' Compensation Unit. It undertook a process of investigation. As to the overpayment issue, Mr De Courcey submitted that this case was different to Hollingsworth. The applicant had a duty to act in good faith towards his employer, and failed to do so. It was a matter the applicant should have informed the Director General of.

59 Mr De Courcey argued that the role and duties of a gatekeeper were the same as a security guard. The issue was not that the Caltex site was vacant, but that the applicant's duties put him at risk and the respondent at further liability for any injury. Mr De Courcey noted that Dr Davies' evidence did not assist the applicant. Dr Davies was unequivocal in stating that he had not known the applicant was working as a security guard. The applicant's credibility was further at issue when he said he had told the doctor of his secondary employment. The applicant set out to further mislead his employer and the insurer by incorrectly answering "no" to the question on the form that he had not received any other wages while on workers' compensation.

60 Mr De Courcey submitted that no issues of procedural unfairness arise in this case. The applicant knew exactly what he was accused of doing. There was a proper investigation. The applicant was invited to respond to the allegations and put any matter in mitigation. The Director General had considered all the issues and acted appropriately. Mr De Courcey contended that the question of financial hardship is not an issue in this case. All dismissals will disclose degrees of hardship.

61 Mr De Courcey emphasised that the applicant was aware that he had to obtain permission to undertake secondary employment. He had read and understood the Code of Conduct. He even knew during the investigation that written approval was necessary, but failed to do so and continued working his secondary employment without approval.

62 Mr De Courcey asserted that the applicant was engaged in deceptive conduct. He must have been aware that he was working while on workers' compensation. He hadn't informed the Director General of his secondary employment.

63 Mr De Courcey submitted that the allegations against the applicant had been proven and admitted. This was an applicant whose credibility and honesty was in doubt. He was evasive and misleading and changed his evidence to suit himself. His dismissal was not 'harsh, unreasonable or unjust,' and there were no procedural deficiencies in the investigation.

In reply

64 Mr Gibian submitted that Mr De Courcey made a number of general assertions which were not supported by the evidence.

65 He said that the applicant had not volunteered that he was sick on 25 and 26 October 2001. Rather, he obtained this information during the preliminary inquiry. In the absence of the Department's records, the Commission was left only with the applicant's evidence that he could not recall when he attended the first aid course at Sutherland Hospital.

66 As to what was said at the interview panel, Mr Gibian put that the applicant's evidence was entirely consistent. No one had told him he couldn't continue working his secondary employment or that he should seek permission, written or otherwise, to continue doing so.

67 As to the contradictory evidence of the applicant and his doctor, Mr Gibian made two points. Firstly, the applicant said he had told his other doctors and they had seen no difficulties with the Satinvale work. Secondly, Dr Davies said that even if he had been told, he saw no difficulty with the applicant's work for Satinvale. It was also incorrect to claim Dr Davies had restricted the applicant to clerical work. His evidence was that the work should not expose the applicant to violent incidents or heavy lifting.

68 Mr Gibian submitted that there was no evidence that the applicant was told not to undertake secondary employment during the disciplinary investigation. There was no basis to suggest that the applicant was to cease the work or seek written approval to continue. The reference in the Director General's letter on this issue was vague and unclear. If the evidence was to be contradicted, the Director General or Mr McGrath should have been called.

69 Mr Gibian said that the applicant's secondary employment was only on weekends. It was never suggested he had worked secondary employment when he was supposed to be working his primary employment. It had not been part of the investigation, nor was it put to the applicant in the allegations.

70 As to the issue of the overpayment, Mr Gibian submitted that it would be open for the Commission to express a view as to the appropriateness or otherwise of the respondent's conduct, particularly in light of the unfairness and distress to the applicant caused by it's actions.

CONSIDERATION

Relevant Principles

71 In a case of summary dismissal for misconduct four questions usually arise for consideration. Firstly, was the conduct alleged against the dismissed employee proven? Secondly, if the misconduct was proven, did the seriousness of the misconduct justify summary dismissal? Thirdly, did the conduct constitute a fundamental and wilful repudiation of the contract of employment? Fourthly, were mitigating factors taken into account?

72 In some cases of summary dismissal the employee will contest the allegations which led to the employer's decision to terminate the contract of employment. In such cases, the employer is required to prove the allegations. The Commission must be satisfied that the employer's onus to do so has been discharged and make findings, on the balance of probabilities, that the misconduct occurred.

73 The oft quoted authority for this proposition is found in Pastrycooks Employees, Biscuit Maker Employees & Flour and Sugar Goods Workers Union (NSW) v Gartrell White (No 3) (1990) 35 IR 70:

It is undoubted, in my view, and as Mr Walton conceded, that the onus for making out a case to warrant the intervention of the Commission in ordering reinstatement is on the claimant union: see Re Barrett and Women's Hospital, Crown Street (1947) AR (NSW) 565; Re Municipal Employees, Greater Newcastle (Wages Division) Award (Re Wallace) (1949) AR (NSW) 868; Western Suburbs District Ambulance Committee v Tipping (1957) AR (NSW) 273 at 279 and Homebush Abattoir (1966) AR (NSW) at 386. However, it is also undoubted, in my view, that where an allegation of misconduct is raised as a defence or as justification for a particular course of action by an employer, such as in summarily dismissing an employee, then the legal burden, in an evidentiary sense to establish that fact, shifts from the union to the employer: see WD & HO Wills (Australia) Ltd v Jamieson (1957) AR (NSW) 547 at 552, 553; North v Television Corporation Ltd (1976) 11 ALR 599 at 602; Flynn v JC Hutton Pty Ltd (1982) 3 IR 413 at 414; Williams v Printers Trade Services (1984) 7 IR 82 at 84; and Wallace v Deering Auto Electrics (1985) 12 IR 34 at 35. To the extent that Mr Newall submitted to the contrary, his submission cannot stand. The approach as to this shifting of the burden of proof received conceptual support in the judgment of Dixon J, as he then was, in Darling Island Stevedoring & Lighterage Co Ltd v Jacobsen (1945) 70 CLR 635 at 643, and in that passage from his Honour's judgment which said at 644:

Again, it is a general principle that absence of default or wrongdoing is presumed and proof is required when its absence is made a qualification of a right. It is in accordance with principles to regard fault as a particular exception defeating the right only when alleged and proved.

The right of an employer to summarily dismiss an employee without notice is qualified by the employee inter alia having committed an act of misconduct; thus, to be able to rely upon the right, and to pay the employee up to the time of dismissal only rather than terminate by notice or payment in lieu of notice, the employer must not only allege misconduct but must also prove it. In support of his submission on onus, Mr Walton referred to the judgment of Dey, J. in Re Wentworthville Leagues Club Ltd (1976) 18 AILR 355, in which his Honour clearly held that the necessity for proving misconduct lay upon the party setting it up, namely the employer, and even though the union had the responsibility for establishing a proper case for reinstatement. I respectfully agree with his Honour's conclusion, it being entirely consistent with well established authority

74 This principle was neatly summarized by a recent Full Bench of the Commission in Humphries and Cootamundra Ex-Services and Citizens Memorial Club Limited [2003] NSWIRComm 211 at p86:

...where an allegation of misconduct is raised as a defense or as a justification for a particular course of action, the legal burden shifts to the respondent employer (although the onus to be discharged in unfair dismissal proceedings is to establish to the satisfaction of the Commission according to the civil standard of proof, that the dismissal was harsh, unreasonable or unjust): Pastrycooks Case at [83] - [84]) and Price v Box Valley Pty Ltd (1999) 90 IR 480 at 483.

See also other Full Bench authorities on the subject in Wang v Crestell Industries Pty Ltd (1997) 73 IR 454; Shop, Distributive & Allied Employees' Association v Jewel Food Stores (1987) 22 IR 1; Franklins Ltd v Webb (1996) 72 IR 257, Price v Box Valley Pty Ltd (1999) 90 IR 480 and Bigg & Anor v NSW Police Service (1998) 80 IR 434.

Was the dismissal too harsh?

75 In Byrne and Anor v Australian Airlines (1995) 61 IR 32 the High Court said a termination of employment "may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted" (p72). In Electricity Commission of New South Wales t/as Pacific Power v Crump at p302 the Full Commission said:

The conciliation commissioner, therefore, in our view of his decision, was concerned that the ultimate sanction of termination of employment was too severe a penalty. That approach was properly open to the conciliation commissioner, notwithstanding his favourable finding as to the action of the appellant, is supported by the decision of Watson J in Metropolitan Meat Industry Board v Australasian Meat Industry Employees' Union, New South Wales Branch [1973] AR (NSW) 231 at 233 as follows:

I fail to see why in applying this test to determine whether or not he should intervene, and having in mind the considerations referred to by Sheldon J in Loty's case [1971] AR (NSW) 95 at 99, the commissioner (or the Commission on appeal) is precluded from considering whether or not termination was too severe a penalty in all the circumstances - even if the dismissal was legally justified or even if, as Mr McDevitt put it, the point had been reached where at the particular time the employer's representative was faced with a situation which had developed to a stage where he had no other alternatives.

In some cases, the issue of unfairness has been resolved because of the way in which the employer has exercised his right to dismiss or because of the absence of adequate justification for dismissal. But even if there are grounds for terminating the contract of employment, it is still open to the tribunal to examine the severity or otherwise of the step of dismissal. The Commission, commissioners and committees have so acted in the past and have intervened to order reinstatement where because of mitigating circumstances or past good conduct, termination has been shown to be too harsh a consequence.

See also Little v Commissioner of Police (No.2) (2002) 112 IR 212, Busways v Johnson (1994) 55 IR 255 and Wells v Commissioner of Police (2000) 100 IR 106.

76 Thus, it is plainly open for the Commission to review the decision of the employer and determine that a particular dismissal was too severe a penalty in all the circumstances (see also my conclusions in Transport Workers' Union of Australia, New South Wales Branch, on behalf of Joseph Vallis, and TNT Australia Pty Limited, trading as TNT Express [2002] NSWIRComm 46; Federated Municipal and Shire Council Employees' Union of Australia, New South Wales Division, on behalf of Gregory Bowman and City of Sydney Council [2001] NSWIRComm 91 and Police Association of New South Wales on behalf of Adam Tregonning, and New South Wales Police Service [2000] NSWIRComm 14.

77 It is obvious that the summary dismissal of an employee for misconduct can have serious and sometimes long term implications for the employee. It is for this reason that the Full Bench in Franklins Ltd v Webb reminded employers of the need to be fully satisfied that the misconduct had been committed and that the conduct justified dismissal. The Full Bench said at p261:

We consider that the significance of decisions by employers to dismiss employees in circumstances such as occurred here cannot be over-emphasised. Mr Webb is a man of advancing years with long service and an unblemished employment record. The consequences for him of the employer's decision to dismiss are considerable - not only pecuniary considerations arise but also issues such as loss of self-esteem and confidence, difficulty in obtaining future employment and loss of social standing; tremendous upset upon the individual concerned and his family, with serious consequences quite unanticipated at the time of dismissal, must also be taken into account. It is considerations such as those which seem to us to have motivated the Commission in Court Session to remind employers of the need to be fully satisfied after proper investigation that the employee has committed the conduct to support dismissal.

78 In Hill v Department of Juvenile Justice [2000] NSWIRComm 128, serious allegations concerning the supply of drugs to juvenile offenders, by a person in charge of their welfare were the alleged reasons for the employee's dismissal. The allegations had no basis in fact and could not be proven. I said at para 62-63:

In Standley v Electronics Boutique Australia Pty Ltd, IRC 4516 of 1998, 18 March 1999, I considered the serious implications for an employee where allegations of misconduct are made. I said at p14:

It hardly needs to be said that summary dismissal is the most serious form of sanction an employer can take against an employee. It can, not only serve as a means of punishing the employee for transgressions in the then existing employment relationship but can, and often does, jeopardise and diminish the employee’s future employment prospects.

A finding by this Commission that a summary dismissal was justified, is a most serious matter which may unhappily burden and grievously harm an employee for years into the future.

See also my discussion of this matter in Thornton and Happy Hours Pre School Kindergarten, IRC5333 of 1999, 29 July 1999 and Taggart and Bell Sports Australia, IRC5224 of 1998, 10 September 1999.

The serious unproven allegations made against the applicant have gravely impugned his reputation. Left to stand unchallenged, these allegations would seriously hamper his future employment prospects, damage his reputation and more than likely, deleteriously effect his well being and that of his family. It is the Commission's duty - indeed, its obligation - to correct the injustices the applicant has so plainly suffered. I unreservedly intend to do so.

See also my comments in Standley and Electronics Boutique Pty Ltd (unreported, Sams DP, IRC98/4516, 18 March 1999); Federated Municipal and Shire Council Employees' Union of Australia, New South Wales Division, on behalf of Bowman, and City of Sydney Council and Staal and Tupene and Health and Research Employees' Association of New South Wales (on behalf of Nagy and Others) and Western Sydney Area Health Service [2004] NSWIRComm 27.

Repudiation of employment contract

79 All of the allegations against the applicant were described as misconduct; the additional word "wilful" was not used. However in my opinion, where an employee has been dismissed for misconduct, the conduct must be such as to constitute a repudiation of the contract of employment by the employee. There must be disclosed a wilful and deliberate intent by the employee.

80 Did the serious misconduct here alleged constitute a wilful repudiation of the contract of employment by the applicant? In deliberating on this question, I refer to four authorities:

In North v Television Corporation Ltd (1976) 11 ALR 599, Franki J said at p616:

It is clear that a single act of disobedience may be sufficient to justify dismissal on the ground of misconduct but it was held in Laws v London Chronicle (Indicator Newspapers) Ltd [1959] 2 All ER 285, that to justify summary dismissal a single act must be such as to show that the employee was repudiating the contract of service or one of its essential conditions.

The 1959 English case referred to makes it plain that an act of disobedience or misconduct (justifying dismissal) requires also that the disobedience must be "wilful":

... I do, however, think (following the passages which I have already cited) that one act of disobedience or misconduct can justify dismissal only if it is of a nature which goes to show (in effect) that the servant is repudiating the contract, or one of its essential conditions; and for that reason, therefore, I think that one finds in the passages which I have read that the disobedience must at least have the quality that it is "wilful": it does (in other words) connote a deliberate flouting of the essential contractual conditions. (P288).

Hungerford J in Day v Lumley Life Limited (1999) 90 IR 70, described the employment relationship as a serious contractual relationship involving rights and obligations on both sides:

The employment relationship, I have to say, is a serious relationship with important incidents for both parties to it. It is a consensual relationship based on contract and with respective rights and obligations. It should not, I think, operate, or to be so seen, in practice in a way, which permits one party, here, the employer, to act in a one-sided manner contrary to the legitimate expectations and understandings of the other party, here the employee, and particularly where such action damages or detrimentally affects the career interests of the employee. Employees have a corresponding duty to act with fidelity and good faith.

In Concut Pty Ltd v Worrell and Anor (2000) 103 IR 160, his Honour, McHugh J, dealt with the ordinary relationship of the employer and employee at common law:

The ordinary relationship of employer and employee at common law is one importing implied duties of loyalty, honesty, confidentiality and mutual trust. At common law:

"[c]onduct which in respect of important matters is incompatible with the fulfillment of an employee's duty, or involves an opposition, or conflict between his interest and his duty to his employer, or impedes the faithful performance of his obligations, or is destructive of the necessary confidence between employer and employee, is a ground of dismissal. ... [T]he conduct of the employee must itself involve the incompatibility, conflict, or impediment, or be destructive of confidence. An actual repugnance between his acts and his relationship must be found. It is not enough that ground for uneasiness as to its future conduct arises."

In the present case, the findings at trial went beyond mere uneasiness as to the future. They necessitated, or at least warranted, a conclusion that the "confidence" essential to the relationship of employer and employee had been destroyed. Instead of pursuing the interests of the company and its shareholders, the employee had pursued his own private interests. Not only was the employee in breach of his duty of fidelity and trust owed to the employer, he had remained in breach of that duty to the date of the trial. Until that time he had not accounted for the benefits wrongly appropriated by him. Indeed, he had denied any wrongful appropriation. The issue so tendered at the trial was determined against the employee. He was then subject to the employer's counter-claim for an order to make a refund. Such order was duly made at trial. It was not contested on appeal. Given his senior status in the company's service and the nature and extent of the misconduct disclosed in the evidence and accepted by the primary judge, it was open to him to find that the employee had undermined the confidence essential to the ongoing relationship of employment. Prima facie, this had afforded a legal justification for the employee's summary dismissal.

It is, however, only in exceptional circumstances that an ordinary employer is entitled at common law to dismiss an employee summarily. Whatever the position may be in relation to isolated acts of negligence, incompetence or unsuitability, it cannot be disputed (statute or express contractual provision aside) that acts of dishonesty or similar conduct destructive of the mutual trust between the employer and employee, once discovered, ordinarily fall within the class of conduct which, without more, authorises summary dismissal. Exceptions to this general position may exist for trivial breaches of the express or implied terms of the contract of employment. Other exceptions may arise where the breaches are ancient in time and where they may have been waived in the past, although known to the employer. Some breaches may be judged irrelevant to the duties of the particular employee and an ongoing relationship with the employer. But these exceptional cases apart, the establishment of important, relevant instances of misconduct, such as dishonesty on the part of an employee like Mr Wells, will normally afford legal justification for summary dismissal. Such a case will be classified as amounting to a relevant repudiation or renunciation by the employee of the employment contract, thus warranting summary dismissal.

See also Blyth Chemicals Limited v Bushnell (1933) 49 CLR 66; Transport Workers' Union of Australia, New South Wales Branch, on behalf of Joseph Vallis, and TNT Australia Pty Limited, trading as TNT Express and Hunt v Hornsby Shire Council [2001] NSWIRComm 242.

Mitigating factors

81 It is generally accepted that an employer may take into account an employee's past conduct or warnings when making a decision to dismiss the employee. Authority for this proposition is found in John Lysaght (Australia) Limited and Federated Ironworkers' Association of Australia, New South Wales Division & Ors (1972) AILR 517:

The union's argument in relation to this matter is not easy to understand. It suggests that although the record is not a satisfactory one, it should be overlooked because the company, except for a warning and a suspension here or there, allowed it to run on and in effect condoned or waived it. It further says that the record has to be looked at in the light of the fact that there is admittedly a good deal of absenteeism generally in the plant. If one were to take this argument to its full extent, it would involve the union in saying that Mr York should have been dismissed long ago. It is no doubt possible for the company to waive particular acts of misconduct that would otherwise justify dismissal without notice. These particular acts could not subsequently be used for this purpose once a decision was made not to rely on them. The act of misconduct however does not then disappear and become irrelevant when further misconduct occurs. It remains and makes up the continuing history and record of a man's service. That record may always be referred to for the purpose for which the company now points to it and the presence of incidents such as I have described will always be a relevant factor to be weighed in the balance by an employer when he comes to consider whether or not a further breach or other act of misconduct should not bring about dismissal. This will be all the more so where, as here, the dismissal is upon notice.

82 Of course, it is equally true that taking into account past performance works both ways. That is, it would be wrong for an employer to ignore an employee's otherwise exemplary record when weighing up all the factors in its decision to dismiss. I adopt the words of McLeay C in Paris v Bankstown City Council [1999] NSWIRComm 10:

It is clear that no account was taken of mitigating circumstances, either associated with the misconduct (namely, that the applicant's supervisor was the instigator of the misconduct) or the employee's work record (which showed a good record of over forty years). It has long been accepted that the whole of an employment relationship is relevant to a question of dismissal (see John Lysaght (Australia) Ltd v FIA; Re York (1972) AILR 517 per Sheppard J). In my view, it is as unfair to ignore a good work record of long standing as it would be to ignore incidences of previous misconduct.

83 That is not to say that an unblemished record would mitigate completely against a particular act of serious misconduct. Each case will turn on its own facts and circumstances and the gravity of the misconduct. Nevertheless, it is a factor which might tip a dismissal either way if the decision is finely balanced. It follows therefore, that an employer should be cognisant of, and give appropriate weight to the employee's past record of employment.

Meaning of harsh, unreasonable and unjust

84 Even if the employer discharges the onus to prove allegations made against an employee, it is incumbent on an applicant to discharge the onus of satisfying the Commission that his/her dismissal was harsh, unreasonable or unjust within the meaning of Pt 6 ch 2 of the Act (see Western Suburbs District Ambulance Committee v Tipping (1957) AR (NSW) 273). A finding of whether a particular dismissal is harsh, unreasonable or unjust is a mixed question of fact and law.

85 It is now well settled industrial law that each of the words - harsh, unreasonable and unjust - have their own discrete meaning and not all three descriptions of a dismissal are necessary for a finding of unfairness. In other words, a particular dismissal might be found to be "harsh" but not "unreasonable" or "unjust". This principle arises from the oft-quoted authority in Byrne & Anor v Australian Airlines where the expression "harsh, unreasonable or unjust" was considered in an Award clause. In their joint judgment McHugh and Gummow JJ said at p72:

It may be that the termination is harsh but not unjust or unreasonable, unjust but not harsh or unreasonable, or unreasonable but not harsh or unjust. In many cases the concepts will overlap. Thus, the one termination of employment may be unjust because the employee was not guilty of the misconduct on which the employer acted, may be unreasonable because it was decided upon inferences which could not reasonably have been drawn from the material before the employer, and may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted.

86 The principle was further discussed in Outboard World v Muir (1993) 51 IR 167 where a Full Commission said:

First we deal with the argument for the appellant that the Commission erred by applying the wrong test in connection with the dismissal: 'unfair' rather than 'harsh, unreasonable or unjust' dismissal. We agree with Mr Reitano's submission in this respect that the reference by the Commissioner to "unfairness" did not represent any misunderstanding of the correct test but was merely the use of a shortened form of expression intended to embrace the three relevant words. Whilst we recognise that there may be a natural tendency (recognised in the use even by the advocate for the Company before the Commissioner of the term 'unfair') to use the shortened form, we consider that it is preferable that a member of the Commission utilise the precise words provided by s246, rather than the catch-all heading, particularly when expressing the basis for a finding that a dismissal is within one or more of the heads provided by the section. We take this view because, even though there may be some circularity in the full phrase 'harsh, unreasonable or unjust', we detect scope for variation of meaning which may be critical to the determination of a particular matter and may be obscured by the use of the substitute term "unfair". Different but not wholly dissimilar words, "unfair", "harsh", and "unconscionable", are used in s275, power of the Industrial Court to Declare Certain Contracts Void, of the 1991 Act. In relation to those words, then appearing in s88F of the 1940 Act, the Commission in Court Session (Perrignon, Cahill and Dey JJ) in A & M Thompson Pty Ltd v Total Australia Ltd [1980] AR (NSW) 399 at 418 Cahill J (delivering a separate judgment) said:

The duty of the Commission is to reach a conclusion on the issues of whether the subject transaction is 'unfair', or 'harsh' or 'unconscionable'.

It has been said that those words are a 'tautological trinity' (Davis v General Transport Development Pty Ltd) [1967] AR 371) but we prefer to take the view that there is a perceptible difference between the meaning of the term 'unfair' and that of the terms 'harsh' and 'unconscionable'. What is unfair may not be so unfair as to be 'harsh'. But, whether this view be correct or not, once the transaction is found to be unfair the Commission may proceed to exercise its very wide power.

In much the same way, we consider that, while strict definitions of 'harsh', 'unreasonable' and 'unjust' may produce a degree of circularity of meaning, turning on the notion of 'fairness', it may be in a given case that a dismissal may be viewed as coming within the ambit of one of the three adjectives but not the others. To avoid the possibility of misunderstanding or error, the tribunal, when making that primary finding, should state explicitly the basis on which it is made.

87 A Full Bench authority reaffirming the distinction between the three words, and requiring the Commission to make a positive and specific finding on a dismissal is to be found in Bankstown City Council v Paris (1999) 93 IR 209:

The Commissioner found that the dismissal by the Council of Mr Paris was 'harsh, unreasonable or unjust'. This phrase, contained within s84, is an important key to jurisdiction and does require some specificity of finding. As has been observed by the Commission on numerous occasions, a dismissal may be capable of being unreasonable but not harsh, or harsh but not unjust, other permutations may apply. In the present case, however, it seems to us that the dismissal of Mr Paris was capable of meeting not one or the other of those descriptions but each of them. Therefore, nothing turns upon the expression adopted by the Commissioner. We would observe that in a case where the conduct of the employer might satisfy one but not all of those heads, a positive and specific finding should be made.

88 I turn then to consider the above principles in the context of the facts and circumstances of this case.

89 There was little argument put as to whether the applicant was denied procedural fairness in respect to his dismissal. That being said, I am confident that conclusions in this case can comfortably be made on the substantive unfairness of the applicant's dismissal.

90 One of the issues canvassed in the proceedings was whether the applicant had sought, and was given approval, to work secondary employment. The respondent maintained that written approval was required. The Code of Conduct was not tendered in the evidence, so I am uncertain whether written permission is expressly required to be sought and given. In my judgement however, the correct issue to be addressed is not whether written permission was required, but whether the respondent was aware of the applicant's secondary employment. On this, the evidence is clear.

91 The applicant deposed that he had informed the interview panel in June 1998 that he worked as a part time security officer and he intended to continue doing so. Mr Horton confirmed that the applicant had told him this in 1999. There was no evidence brought by the respondent to refute the applicant's claim. Three management persons conducted the interview, yet not one of them was called to give evidence about this matter - notwithstanding Mr Holdgate's evidence that he knew who had been on the panel. Even more curious, Mr De Courcey informed the Commission that there was no record of who was on the interview panel or any record of notes of the interview.

92 That being so, I accept the applicant's evidence that he had informed management of his secondary employment and that he genuinely believed that this advice was sufficient notice to the Department.

93 Moreover, the applicant was hardly seeking to hide what he was doing. Other Sheriff's Officers worked secondary employment. Mr Horton and Mr Holdgate knew the applicant was working secondary employment as early as 1999. Whether Mr Horton found out directly from the applicant (which I am inclined to accept) or from other staff, is really not the point. Mr Horton's evidence was that he reported the matter to the Regional Manager. In other words, management at numerous levels had known for years of the applicant's secondary employment. It begs the question of course, had it been a problem for the respondent, why didn't it do something about it? In my judgement, this evidence would seemingly end any suggestion that the respondent had not known of the applicant's secondary employment. However, there was further uncontested evidence on the issue.

94 For example, the applicant identified his other employment with Sutherland Hospital on an employee compensation claim form. The hospital would also phone for him at the Sheriff's office to inquire as to the applicant's availability to work. In my opinion, this was hardly evidence of an employee deliberately seeking to hide his actions in order to defraud the employer. Nor was it conduct, which might be said to be wilfully in breach of the contract of employment.

95 I also note that the applicant continued to work his secondary employment during the disciplinary investigation up to his dismissal. Apparently, no one in management had warned him that continuing to do so was inappropriate, let alone in breach of his contract of employment. With that having been said, I accept Mr Gibian's submission that the respondent knew of and condoned the applicant's conduct and it cannot now rely upon such conduct to justify his dismissal. As I said in the Staals and others case, "the respondent has effectively waived its right to dismiss the applicant's for serious misconduct."

96 In my view, the respondent's evidentiary case against the applicant was seriously deficient. I should say that I found the paucity of evidence from the respondent to be rather unusual and most unhelpful. This should not be seen as any criticism of Mr De Courcey. The case he sought to argue was wafer thin. It lacked any sound evidentiary basis.

97 There were examples of the respondent's failure to call evidence to support its claims or to refute the evidence of the applicant. This material went to such matters as a failure to call persons on the interview panel, a failure to produce documents relating to the applicant's sick leave record and Return to Work Program and a failure to provide evidence of the precise breach of the Code of Conduct.

98 As to this last matter, I accept the applicant's evidence that he could not recall signing, or reading the Code of Conduct. It was clear nevertheless that he had signed for it at the time. This was perfectly understandable after five years had elapsed. It was also extraordinary that the person (Mr McGrath) who conducted the investigation and interviewed the applicant (and presumably recommended his dismissal) provided no evidence to the Commission. I do not understand why this was so.

99 Perhaps even more unbelievable, (if not alarming) was the evidence that Mr Horton had never been interviewed as part of the investigation. Mr Horton had directed the applicant's work on a day to day basis for five years (less six months when he was at Waverly in 2002). Thus, the person with the most intimate knowledge of the applicant's skills and capabilities was not even interviewed in the investigation process.

100 Mr De Courcey drew a number of conclusions which were simply not open on the evidence. For example, he claimed the applicant knew he had to apply in writing for approval to work secondary employment. There was no memo, direction, policy or oral evidence of any such requirement. Mr De Courcey argued that the applicant worked contrary to his Doctor's advice. That was simply not so. The Doctor did not bar the applicant from particular duties. Moreover, the Doctor accepted that the work for Satinvale was different to Sheriff's Officers' duties.

101 Mr De Courcey sought to discredit the applicant's evidence by reference to him not being able to recall circumstances which he had earlier contended had happened. I do not accept that this submission impugned the applicant's evidence. It was perfectly understandable that, when pressed in cross examination, about events which occurred five years ago, a witness might begin to doubt him or herself. In any event, these were about matters of little moment. On the issues of significance, the applicant's evidence was steadfast and unshakable; and, in some instances, corroborated by the respondent's own evidence. I found the applicant to be a credible witness whose evidence I accept.

102 A more serious matter of course was the allegation that the applicant was working his secondary employment while on workers' compensation and that he failed to inform his employer or the insurer he was doing so. The applicant readily conceded he had done so. However, he explained that while he was unfit for the full range of Sheriff's duties, he was performing work which would not exacerbate his injury and had been cleared by his doctor to do so. This contention requires a close examination of both the Doctor's evidence and the work the applicant was performing at the Caltex site in Birchgrove.

103 It is to be observed that Dr Davies' evidence was that the applicant had never told him he was working for Satinvale as a security officer or gatekeeper. The applicant claimed his Doctor was mistaken. It is to be noted that the applicant was consulting two or three other doctors. It may have been one of these whom he had told.

104 In any event, I do not believe much turns on this contradiction of evidence. The Doctor was subsequently given a list of duties identified by Satinvale and concluded it "was reasonable for him to perform this work" as distinct to the threats posed by working as a Sheriff's Officer. A letter from Satinvale described the duties as:

As a security guard, Robert is not expected to come into contact with the public as the site is closed and secured. His duties are to ensure the perimeter and the integrity of the site is intact. His patrols are conducted on foot or if he desires, in part, by vehicle. The main focus of his duties is that of an environmental officer to ensure that there are no fuel spills on the site or in particular, into the harbour. Fire is naturally a serious concern.

During the period that our company has provided security for this site, which commenced in 1988, we have had only five instances of trespassing, none of which involved Robert Lawrence. In addition, none of these incidents involved any form of physical confrontation.

105 In view of the evidence of his treating neurosurgeon and the applicant's secondary employer, I am disposed to accept the applicant's claim that he was not fit for normal duties as a Sheriff's Officer, but was able to perform the gatekeeping duties at the Caltex site in Birchgrove.

106 Moreover, I think it is particularly apposite that he did not undertake this work at times when he was otherwise expected to be at his primary place of employment. It was weekend work. I accept Mr Gibian's submission that there is no general prohibition on an employee undertaking a second job so long as the employee was not acting outside his duty to the primary employer. See Hivac Ltd v Park Royal Scientific Instruments Ltd and Cementaid (NSW) Pty Ltd v Chambers.

107 While the applicant may have been guilty of naivety or ignorant of the Department's requirements, I cannot accept he was guilty of wilful misconduct, such as to breach the contract of employment and warrant summary dismissal. I accept his evidence that, in light of the serious financial difficulties his injuries had caused, he was merely seeking to provide for his family. I note that the respondent did not seriously, or at all, call this evidence into question.

108 I have observed the applicant's demeanour in the witness box and his claims of what he genuinely believed about the approval for his secondary employment. I accept the applicant's evidence that he did not seek to deliberately mislead Mr Glanfield about his secondary employment.

109 I note also that it was conceded there were no other adverse reports on the applicant's personal file. In these circumstances, I do not believe the respondent gave sufficient weight to the applicant's otherwise unblemished record and personal circumstances.

110 For the reasons I have expressed herein, the Commission cannot be satisfied that the allegations against the applicant have been proven to the requisite standard. Accordingly, the respondent's case must fail. I find that the applicant's dismissal for misconduct was harsh, unjust and unreasonable within the meaning of Pt 6 ch 2 of the Act.

Remedy

111 The applicant does not seek reinstatement; although I should say that had he done so, I would have unhesitatingly ordered it. That being so, I am disposed to make a compensatory order having regard for inter alia, the applicant's financial and personal circumstances, his period of unblemished service and the degree of unfairness of his dismissal. I also take into account (although not in any strict arithmetical sense), the fact that the applicant has continued to work as a security officer and has secured alternative work, albeit at a lessor rate of remuneration. See D & R Commercial Pty Ltd v Flood (2002) 113 IR 344.

Orders

112 The Industrial Relations Commission of New South Wales orders:

1) Pursuant to s89(5) and (6) of the Industrial Relations Act 1996 that the respondent, the Attorney General's Department, shall pay to the applicant, Mr Robert Lawrence, an amount of eighteen weeks salary at the rate he was receiving at the time of dismissal.

2) The amount in Order 1 shall be paid within 21 days of today.

In view of the Commission's findings in this matter, I would further recommend that the applicant's debt to the Department be waived.

These proceedings are concluded.

PETER J SAMS AM

DEPUTY PRESIDENT

LAST UPDATED: 19/03/2004