Abbott and Markham v. BlueScope Steel (AIS) Pty Limited [2007] NSWIRComm 1087

CATCHWORDS: termination of employment - steelworks - referral agreement - breach of fundamental requirement to work in a safe manner - occupational health and safety - employees dismissed

LEGISLATION CITED: Industrial Relations Act 1996 Occupational Health and Safety Act, 2000

Brown v. BlueScope Steel (AIS) Pty Limited [2005] NSWIRComm 1021 Re Clarke and the Metropolitabn Meat Industry Board (1967) AR 16 Homebush Abattoir Case (1966) AR 371 CASES CITED: John Lysaght (Australia) Limited v. Federated Ironworkers' Association (1972) AILR Rep.517 Jovanovski v. BlueScope Steel (AIS) Pty Limited [2007] NSWIRComm 1019 Laws v. London Chronicle (indicator Newspapers) Limited (1959) 2 All ER 285 Metropolitan Meat Industry Board v. Australasian Meat Industry Employees' Union (1973) AR 231

HEARING DATES: 08/11/2007, 09/11/2007, 19/11/2007, 20/11/2007, 27/11/2007

APPLICANT Wayne Phillips Australian Workers Union LEGAL REPRESENTATIVES:

RESPONDENT Michael Mead Australian Industry Group

DECISION: INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES

Anthony Abbott and David Markham and BlueScope Steel (AIS) Pty Limited

Application by the Australian Workers Union under S.84 of the Industrial Relations Act, 1996 concerning the termination of the services of Anthony Abbott by BlueScope Steel (AIS) Pty Limited

Application by the Australian Workers Union under S.84 of the Industrial Relations Act, 1996 concerning the termination of the services of David Markham by BlueScope Steel (AIS) Pty Limited

Notification of an industrial dispute under S.130 of the Industrial Relations Act, 1996 re termination of the employment of two battery specialists working in the coke ovens of BlueScope Steel (AIS) Pty Limited

Referral of an industrial dispute under S.146A of the Industrial Relations Act, 1996 by the Australian Workers Union and BlueScope Steel (AIS) Pty Limited

1 Pursuant to the provisions of Part 6, Unfair Dismissals, of Chapter 2, Employment [Ss.83 to 90] of the 1996 Industrial Relations Act the Australian Workers Union lodged applications on behalf of two of its members - Mr Anthony Abbott and Mr David Markham - who were employed by BlueScope Steel as battery specialists at the coke ovens of BlueScope Steel (AIS) Pty Limited at its Port Kembla steelworks. The services of Mr Abbott and Mr Markham were summarily terminated on Wednesday, 11 July, 2007 for alleged misconduct, ie a breach of established procedures over workplace safety over an incident on Wednesday, 27 June, 2007. The AWU has sought in its Part 6 applications the reinstatement of Mr Abbott and Mr Markham.

2 The matters were allocated initially to McKenna C whose attempts at conciliation to resolve these matters was unsuccessful. In accordance with the established protocol, the AWU and BlueScope Steel have signed referral agreements under S.146A (and in accordance with Practice Direction No.18) for these matter to proceed to arbitration. However, following an application under S.173 by the AWU, the file was reallocated to me for that arbitration.

"A party to a dispute to which this section applies may apply to the Commission for the exercise by the Commission of such functions with respect to the resolution of the dispute as may be specified in the referral agreement."

Whilst an unfair dismissal - essentially a dispute between an individual dismissed employee and his employer - is clearly an industrial matter [S.6(2)(e)] the parties are of the view that it lacks the necessary ingredient to make it an industrial dispute which, to my mind, denotes a number of employees acting collectively through their trade union. A notification under S.130 which the AWU has subsequently lodged has also been referred to me. As I indicated in my unreported decision of Wednesday, 11 April, 2007 in Jovanovski v. BlueScope Steel (AIS) Pty Limited [Matter No.IRC 3430 and 3487 of 2006 at pp.3 to 5], a S.130 notification establishes the industrial dispute , the Part 6 applications which the AWU had previously lodged on behalf of Mr Abbott and Mr Markham provides the full range of remedies to them (and confines them by the operation of S.90 not to proceed elsewhere for a remedy over their dismissal); and the S.146A references confirm my jurisdiction to determine the matters by arbitration.

4 In those circumstances on Thursday, 13 September, 2007 the AWU lodged a S.130 notification in support of its claims on behalf of Mr Abbott and Mr Markham. I set the two Part 6 applications down for a mention and programming on Tuesday, 4 September, 2007. Those proceedings, and all subsequent proceedings, were convened in the Commission's premises at 90 Crown Street, Wollongong. I set the S.130 notification for a mention on Tuesday, 9 October, 2007 and issued the certificate of attempted conciliation required by S.135, lodging it in the prescribed manner. I subsequently scheduled the two Part 6 applications lodged by the AWU on behalf of Mr Abbott and Mr Markham and the S.130 notification together.

5 I scheduled the hearing of the AWU claims on behalf of Mr Abbott and Mr Markham on Thursday, 8 November, 2007, Friday, 9 November, 2007, Monday, 19 November, 2007, Tuesday, 20 November, 2007 and Tuesday, 27 November, 2007. In the proceedings Mr Phillips represented Mr Abbott, Mr Markham and the AWU and Mr Mead represented BlueScope Steel. Annexed to this decision is a list of the witnesses called to give evidence in the hearing. The AWU sought, initially over the objections of BlueScope Steel, that I inspect the area of the coke ovens where Mr Abbott and Mr Markham had been working at the time of the incident giving rise to the termination of their services. I directed that such an inspection of the coke ovens take place and that was arranged on Thursday, 8 November, 2007.

6 Coke is the key fuel used in the blast furnace of the steelworks in Port Kembla to produce pig iron for conversion to steel. Coke making at the steelworks is a continuous operation. There are 65 employees involved in the work. Mr Albert Manzini, the coke making maintenance and asset development manager, whom Mr Mead called to give evidence in the hearing, recorded in an affidavit which formed the basis of his evidence that:

"...if equipment breaks down, stopping production, it has a direct impact on the number of tonnes being produced and this has a downstream effect on our customers, particularly our blast furnace operations and export customers. Additionally, a breakdown in equipment also has the potential to significantly damage the battery assets, hence impacting on the operating life of the battery asset and possibly environmental consequences. For this reason, the department that I oversee plays an integral role in the company's operations..."

7 Mr Shane Sainsbury, the team leader for the battery equipment section of the coke making operations, was also called to give evidence in the hearing by Mr Mead. He gave an explanation of the coke making process in an affidavit which formed the basis of his evidence. I found his explanation helpful in highlighting what I had actually observed on the inspection, viz:

"The battery equipment section is comprised of five separate areas. There are three separate batteries, namely 4/5 Battery, 6 Battery and 7 Battery, a workshop area and an office area. In total I have 16 employees that report to me. When we are fully staffed, the allocation of employees to the respective areas is as follows:

• 4/5 Battery - four employees * 6 Battery - two employees * 7 Battery - two employees * Workshop - five employees * Office - three to four employees

The battery equipment section is located within the coke making department of the company. Their purpose is to create coke via the heating of coal within the various ovens that sit within the battery. Both 4/5 Battery and 6 Battery are approximately 300 metres long and 16 metres wide and contain approximately 100 ovens, whilst 7 Battery is slightly smaller, measuring approximately 60 metres long and 20 metres wide and contains approximately 50 ovens.

Each oven is approximately one metre wide and extends along the width of the battery. The coke is created by charging coal into the oven and heating it for approximately 18 hours. The coal is heated to a temperature of approximately 1200 degrees Celsius. Once the heating process is completed, the heated coal (which is now coke) is pushed out of the oven into an empty rail car by a machine called the ram. It is then cooled and transported to the wharf for use in the steel making process..."

Each oven has two doors. One of the responsibilities of battery specialists is to maintain those doors to a high standard to ensure that they adequately seal the ovens and prevent the emission of raw gasses during the coal to coke carbonisation cycle. This is critical work to ensure both safety at work and compliance with proper environmental standards.

"...to ensure that coal is heated properly, each oven is fixed with two pressurized doors which sit on either side of the battery. The doors that operate on 4/5 Battery and 6 Battery are approximately five metres tall and within the vicinity of 2½ tonnes. The doors that operate on 7 Battery are approximately 6.8 metres tall and weigh 3½ tonnes approximately. Each door on the battery sits in what is called a frame. This frame looks essentially like a picture frame, however it also contains four large hooks which are used for clamping the door into place. These frames are of similar dimensions to the respective doors on each battery. In respect to 4/5 Battery and 6 Battery they weigh approximately 1½ tonnes. The frames on 7 Battery weigh approximately 2 tonnes. Each battery contains a control room. The control room operator is responsible for, amongst other things, controlling the device that pushes the coke from the oven into the rail car. The control room and the rail car sit at opposite ends of the battery and sit along its width. The side of the battery which the control room and hot car are located on is called the coke side..."

Located at the end of each battery is a workstation. Damaged doors and frames are removed mechanically from the ovens, taken to that work station and placed on a loading rack. Where there are major repairs the doors or frames are then transferred to the workshop. Minor repairs may be conducted on site at the workstation by the battery specialists.

9 Mr Phillips called Mr Abbott and Mr Markham to give evidence in these proceedings. Mr Abbott has been employed in the Port Kembla steelworks in the coke making department for 14 years, initially as an utilities operator. In 2001/2002 the utilities operator positions became redundant and Mr Abbott was reclassified as a battery specialist, the position he occupied at the time that his services were terminated. Mr Markham commenced employment in the steelworks 22 years ago. He was originally employed as a battery operator, operating battery machines to remove coke from the battery ovens and fill ovens with coal. In 1998 he became an utilities operator and subsequently was appointed as a battery specialist. Neither Mr Abbott nor Mr Markham have an unblemished employment record.

10 Mr Abbott has received frequent counselling over his absenteeism, timekeeping and sleeping on the job for which in the middle of 2003 he received an official warning. More importantly, it appears that Mr Abbott has adopted a somewhat casual approach to safety in the performance of his work and Mr Manzini records in his evidence that there have been numerous separate occasions, covering incidents of varying levels of severity, where he has been involved in safety issues - previous failures to isolate equipment, presenting himself at work in an unfit state, flicking a hot cigarette at another employee, failure to wear his safety glasses, gloves, safety helmet or reflective jacket and failing to wear a respirator when he was engaged in ceramic welding.

11 To that extent, Mr Manzini had assessed Mr Abbott as the employee most "...at risk..." of the 65 employees in his department. Mr Abbott has incurred a number of injuries at work - dust in the eye, an injured ankle, an injured left thumb, a burn to his left wrist, a muscle injury to his left shoulder and a laceration to his index finger - which he attributes to no more than "...bad luck...". I think he has made his own bad luck in that respect by his attitude to workplace safety (which Mr Mead described in his submissions as "cavalier").

"...in my opinion, Mr Abbott either wilfully or negligently breaches BlueScope Steel safety standards on a regular basis and fails to understand the importance of working safely in a high-risk environment. In my opinion, Mr Abbott should not be employed in the steel industry..."

13 Mr Markham has also received counselling and numerous warnings in his employment with BlueScope Steel, essentially over performance related issues and safety breaches - operational errors, horseplay, sleeping on the job, refusal of duty and absenteeism. His relationship with fellow employees and supervisors has also been strained at times and he has had numerous altercations with other employees. His careless driving of equipment [a charger] has resulted in significant emissions and damage to the equipment. He has received counselling over his allegedly threatening and abusive conduct towards employees and supervisors.

14 In fact, in late 1998 Mr Markham's services were terminated but he was reinstated following industrial action and representations by the AWU. A condition of his re-employment was that he no longer work as an operator and, instead, he was assigned work in Mr Manzini's department. In his affidavit Mr Manzini stated as follows:

"...Given my understanding of Mr Markham's employment history, I had reservations about him working in my department. I consider that in light of Mr Markham's record, both before and after entering my department, the decision to employ Mr Markham in my department was unsafe and therefore a mistake..."

15 On Wednesday, 27 June, 2007 Mr Abbott and Mr Markham were directed to lift two frames into the lowering rack and from that onto a spare rack. It is critical safety procedure - a "cardinal rule" for the steelworks - that before such work is performed on a lowering rack, it must be isolated which involves turning off the power for the lift on the power switch nearby and placing locks on it - a multi-lock and the personal locks of the individual employees working on that particular item of equipment. Power will, of course, be restored for the lifting and lowering of the rack but at all other times the power should be disconnected and locked off.

16 There is some confusion over what happened while Mr Abbott and Mr Markham were performing this work on the lowering rack. Indeed, the two employees have not been consistent in outlining their version of events which has not helped Mr Phillips in providing any defence for their actions. Mr Abbott and Mr Markham asserted in their evidence in this hearing that they had transported the first of the two frames across to the lowering rack, isolating it in the proper manner. Mr Markham recorded in a written statement which formed the basis of his evidence that:

"...we then had to go and get nuts and bolts and keepers to put on the door. The nuts and bolts had only arrived that day. We attempted to put the nuts and bolts on with the keepers when we realised that the nuts did not fit the bolts properly. We had to take the nuts off, take them to the vice and run them up and down with some oil to make sure they went on properly. We then took them back to the frame and put them on. This procedure took approximately one hour to perform.

After we finished we raised the frame up and then had to wait for another operator [Mr Bob Glueseski] to come from a different battery to assist us because we cannot drive the machine. We called him to say we were ready for him and he turned up about a half an hour later. I realised that we did not have a dummy door so I went and asked my supervisor where it was. He said it must be at the other end of the battery and I asked how I would get it. He told me to go and ask the battery foreman if they could get it for me. I then had to go and ask if they could take the CTC3 out and bring the CTC4 in to pick it up. About half an hour later they did this. The operator from the other battery did his isolation on the machine, which Mr Abbott and I were involved in.

Then we proceeded to do the job where we moved the frame from the lowering rack into the spare rack. Mr Glueseski proceeded to finish his job and we took our locks off the machine because we had finished doing the job. We then went on to the next step of the job which was to lower the rack..."

17 It was at that time that Mr Abbott received a telephone call from his ex-wife's partner asking him to contact her. He then apparently had a distressing conversation on the telephone with his ex-wife concerning his daughter's schooling which he claimed ended in an argument. Mr Abbott did not volunteer what his particular domestic difficulties were in the proceedings and it was not pressed on him by either Mr Phillips or Mr Mead. It was Mr Sainsbury's understanding that it had something to do with an allegation made against him concerning an alleged improper relationship he had with his daughter. Mr Anthony Mayne, the human resources manager, whom Mr Mead called as a witness in the proceedings, recalled in the written statement which formed the basis of his evidence that in a subsequent interview Mr Abbott had this to say about his personal problems:

"...he had a lot of external family pressures, including his daughter having schooling issues, being on her first day at a new school and not being happy with her new stepfather. Additionally, his partner had had two neck operations and extensive rehabilitation and was on morphine. A further distraction was the demand he was experiencing as the carer for his partner's mother..."

In any event, it is his evidence that he went back to the job "...even though I was upset due to the phone call and some personal issues...".

18 Mr Markham indicated in his written statement that:

"...normally we put a safety lock on when the rack is lowered if you are going to work on it. At the time we did not work on it straightaway because we went off to pick the next frame up. Because I had been doing a number of other jobs that I would not normally have had to do, I did not start working on the frame immediately, as I would have. As soon as I lowered the rack I had gone onto doing something else. When we finished doing other procedures in order to get the frame ready, which took about an hour, we proceeded to take the frame across to the lowering rack again and started putting the keepers back on the rack..."

19 Mr Abbott and Mr Markham assert that they had taken their multi-lock off the power board for the lowering rack and put it on other equipment [the CTC4]. They claim that Mr Abbott went to look for another multi-lock for the lowering rack but were not able to find one. The upshot was that at that time neither Mr Abbott nor Mr Markham carried out the critical isolation procedure for the second frame before they commenced working on it on the lowering rack. Furthermore, Mr Markham was not wearing safety goggles at the time. He claimed in his evidence in this hearing that he had taken them off at the time because they gave him a headache.

20 Mr Abbott simply describes his failure to isolate the lowering rack as an oversight and he is resentful that in subsequent reports over the incident, and in the evidence of Mr Manzini, he is described as having "chosen" not to isolate the equipment, denoting a conscious act on his part, which he refutes. Mr Markham now takes a similar view, asserting in his evidence that it was a simple mistake on his part and the part of Mr Abbott and that when he realised that he had neglected to put on his locks to isolate the lowering rack, he "...felt sick in the stomach and was concerned that we could have injured myself or others...". However, it has been asserted that he did not express those views at the time of the incident and in what he had earlier informed BlueScope Steel management over the incident. I will deal with that particular conflict in the evidence later in this decision.

21 Mr Stephen Murphy, the coke making battery production custodian (a production scheduler), who was called to give evidence in the hearing by Mr Mead, had scheduled in his diary that he would perform a safety audit of the coke ovens - a random, unannounced observation of a group of employees in the performance of their work. Mr Murphy recalled in an affidavit that:

"...when I first arrived at the 6 Battery workstation, I observed that Mr Abbott and Mr Markham were performing work on a frame in the coke side lowering rack as it lay in a horizontal position. There was a third person in the proximity of the work area... I observed Mr Markham working without his safety goggles on whilst he was flogging a spanner with a hammer in an effort to tighten some bolts on the lowering rack. Not only was his failure to wear safety goggles in the circumstances a breach of the company's (safety) policy but additionally, given the nature of the task he was performing, there was an increased risk of an eye injury or foreign body becoming lodged in the eye as a result of him not wearing his safety goggles.

I did not announce to Mr Abbott and Mr Markham that I was performing a safety audit. However, I did immediately question Mr Markham as to why he was not wearing his safety goggles. He replied with words to the effect that he had his goggles on, however they had begun to give him a headache so he had taken them off. I replied with words to the effect that this was not acceptable and that he was required to wear his safety goggles. In response to my statement he put his glasses on, although I did not consider that he was happy to do so.

Following this exchange with Mr Markham, I then proceeded to further conduct my audit. The first thing that I checked was in relation to general housekeeping issues, including...how was the work area maintained from a cleanliness perspective and were there any trip hazards, etc. In conjunction with this I also went to review the housekeeping at the tool storage area. This is located approximately 20 to 30 metres away from where Mr Abbott and Mr Markham were working and required me to move out of their proximity.

I found the tool storage area to be in order and then returned to the workstation area of 6 Battery with the intention of ensuring that any necessary isolation had been performed correctly and to observe Mr Abbott and Mr Markham in more detail as they worked. In total, I would have been in the tool storage area for approximately one minute.

When I arrived back to the workstation area of 6 Battery, Mr Abbott and Mr Markham were still working on the lowering rack in the horizontal position. Given the fact that I was unfamiliar with the set up of the 6 Battery workstation, I began to see if I could locate the power switch for the lowering rack to ascertain if it was isolated. As I looked for the power switch I was within the view of Mr Abbott and Mr Markham.

I did not manage to locate the power switch for the lowering rack prior to hearing Mr Markham say to Mr Abbott words to the effect that he should go and get a multi-lock to isolate the lowering rack. Mr Abbott then left the work area and returned a few minutes later with a multi-lock. Both Mr Abbott and Mr Markham then proceeded to put their personal locks on the isolation switch.

I observed them doing this and from this it was clear that they had not isolated the machine prior to beginning work on it. Failure to isolate whilst working on a lowering rack is a serious incident as it breaches critical safety procedures. I approached Mr Markham and asked him why he hadn't isolated the machine prior to beginning work on it. He replied with words to the effect that '...we were in a hurry...' and that is the reason they didn't isolate the machine before they started work on it..."

22 Mr Abbott initially claimed that, whilst the power switch had not been isolated with locks, it had been turned off. Mr Murphy claimed otherwise. He asserted in his evidence that the power switch was still on and his version was supported by Mr Markham. Subsequently, according to Mr Mayne, when he interviewed Mr Abbott over the incident on Tuesday, 17 July, 2007, Mr Abbott:

"...acknowledged that the equipment that they were working on had not been turned off and that no isolation lock had been applied..."

I am satisfied that not only had Mr Abbott and Mr Markham failed to lock the power switch off but they had worked on the lowering rack whilst the power was on - a doubly dangerous situation.

23 Mr Murphy, who apparently had "...some baggage..." with Mr Markham, ie had been involved in past disciplinary sessions with him, wished to avoid a further direct confrontation with him. He took the matter up with Mr Sainsbury who confronted Mr Abbott and Mr Markham as they were standing beside the lowering rack. Mr Sainsbury spoke to the two employees. Mr Sainsbury claimed that Mr Markham, acting as spokesman, replied to his inquiries:

"We didn't isolate because we were in a hurry and had not had lunch yet. We wanted to get the job completed as quickly as possible so that Bob [Mr Glueseski] could return to 4 Battery."

"There weren't enough multi-locks, so we couldn't isolate. It's your fault we couldn't isolate."

24 Mr Markham emphatically denies that he made such a comments. He believes that Mr Abbott, in fact, may have said something of that nature. I do not believe him. Nevertheless, Mr Abbott was standing beside Mr Markham at the time. He heard what Mr Markham was saying and he apparently remained silent. His acquiescence may not necessarily be taken as agreement to what Mr Markham was saying, however.

25 Mr Markham conceded in his evidence that he was angry at the time - although, to my mind, he would have had no right to be angry with anyone but himself and Mr Abbott for their failure to isolate the lowering rack. They really cannot blame anyone else for their failure to follow standard operating procedure. Both Mr Murphy and Mr Sainsbury recall Mr Markham actually saying that he and Mr Abbott had been "...in a hurry..." to finish the job. Mr Sainsbury recorded in his affidavit that Mr Abbott then commented as follows:

"We knew we had to isolate the rack but we just had a lapse in concentration and forgot. We saw Steve Murphy. Dave (Mr Markham) remembered that we hadn't isolated and asked me to go and get a multi-lock. I went and got one and we isolated before doing any more work."

26 Because Mr Abbott and Mr Markham had breached a critical safety procedure, Mr Sainsbury directed them to accompany him to the staff lunchroom to conduct a more thorough investigation of the incident. He also informed them that they would need to be tested in line with the BlueScope Steel drug and alcohol policy. Mr Sainsbury spoke to Mr Manzini and informed him of the incident. He then took Mr Abbott and Mr Markham to the medical centre for the drug and alcohol tests. Both employees failed the urine test. They tested positive for a prohibited substance (cannabis) and, in accordance with the drug and alcohol policy, were sent home. Further, more comprehensive testing of Mr Abbott produced a result lower than the critical level. BlueScope Steel accepts that the first test was incorrect - a false positive.

27 Mr Markham's test was subsequently confirmed with further testing, however. Mr Markham took another test on Tuesday, 3 July, 2007 and that produced a negative result. In fact, Mr Markham's evidence suggested that he did not see a positive reading for cannabis as in any way producing any problems at work. Whilst he conceded in cross-examination by Mr Mead that other employees may not necessarily share his view, he would be prepared to work with someone who was under the influence of a prohibited substance at the time. That is an extraordinary view, in my opinion. It is certainly not my view, or I suspect the view of Mr Markham's fellow employees. It should go without saying that cannabis or other prohibited drugs and work in the steelworks are entirely incompatible.

28 Mr Sainsbury drove the employees back to the workshop to collect their belongings and then drove them to the car park so that they could get changed out of their work clothes. He indicated to them that he would call a taxi for them, paid for at the expense of BlueScope Steel, to ensure that they got home safely. They declined that offer and drove themselves home. That was an unsafe act, as well, at least on the part of Mr Markham.

29 An investigation of the incident was then conducted by Mr Manzini and he interviewed Mr Abbott and Mr Markham in the presence of Mr Sainsbury. In their evidence Mr Manzini and Mr Sainsbury recalled Mr Markham saying in the interview that:

"...Tony (Mr Abbott) and I isolated the lowering rack when they lifted and fitted the first frame into the lowering rack. After de-isolating the lowering rack, we used the multi-lock isolation device to isolate the CTC4. They then proceeded to lift and fit the second frame into the lowering rack... Tony went looking for another multi-lock prior to commencing any work but couldn't find one. So we continued to work on the lowering rack without the correct isolation... The job wasn't going to take too long and I just wanted to get it done. Then when we saw Steve Murphy, I realised that we had better isolate and lock out the lowering rack..."

That appears to me to be the most plausible explanation of what actually happened.

30 Mr Manzini's conclusions following that investigation were outlined in his affidavit, viz:

"...I formed the view that the incident of Wednesday, 27 June, 2007 was a serious incident and one for which termination of employment may be appropriate. This view was arrived at as a result of the following conclusions:

(a) both employees operated equipment in breach of a critical procedure;

(b) both employees acknowledged that they had received training in relation to the critical procedures;

(c) both employees had been appropriately trained on the standard operating procedures;

(d) both employees acknowledged that their actions were inconsistent with the practices adopted by fellow employees of a similar level of experience and training;

(e) both employees acknowledged that their actions created a risk to their health and safety and the health and safety of their co-workers; and

(f) both employees had breached the company's cardinal rules: in particular, there was considerable evidence to suggest that their breach of the critical procedure was a deliberate breach and not one of omission or error.

I did not consider that I needed to take into consideration the significant and unacceptable performance, safety and behavioural records of these two employees because of the gravity of this incident alone. Had the incident been serious, but of a less significant nature, I would have been required to take their previous records into account. Had I taken their previous records into account an outcome other than termination would have been highly unlikely..."

31 On Wednesday, 11 July, 2007 Mr Manzini wrote to Mr Abbott and Mr Markham in similar terms, terminating their employment with BlueScope Steel, viz:

"...Taking into consideration all the circumstances in the events of Wednesday, 27 June, 2007, and your responses provided, the company believes that your behaviour has been such that the company has lost confidence in your capacity to safely and faithfully perform your duties within the requirements of established policies and believe that the working relationship with management and supervisors of the Port Kembla steelworks is irretrievable. Accordingly, given the seriousness of the actions on Wednesday, 27 June, 2007, the company has decided to terminate your employment instantly due to serious and wilful misconduct..."

32 A subsequent review of the decision of BlueScope Steel to terminate the services of Mr Abbott and Mr Markham, in the nature of an appeal by the AWU, was made by Mr Mayne who conducted interviews of Mr Abbott on Tuesday, 17 July, 2007 and Mr Markham on Wednesday, 18 July, 2007 and spoke to other employees. Mr Mayne confirmed the decision to terminate the services of Mr Abbott and Mr Markham.

33 It was during those interviews that Mr Markham amended his claim to essentially equate with the version of events by Mr Abbott, ie that the two employees had been distracted and simply forgot to isolate the loading rack. Mr Mayne did not believe that version of events. He recorded in the affidavit which formed the basis of his evidence that:

"...in my view, Mr Markham was initially honest in acknowledging that he and Mr Abbott had intentionally not isolated in order to get to their lunch break. Mr Markham then changed his position and attacked the integrity of the investigation in his attempts to recant his earlier statement. Mr Abbott continued to insist that he had simply forgotten to isolate, though could provide no reasonable excuse as to why he had forgotten when, in fact, they had been carrying out numerous isolations on the same equipment on the same day, leading up to the breach..."

34 Both Mr Abbott and Mr Markham have continued to press for their reinstatement in employment. Mr Abbott has found alternative employment in Sydney but the work he has obtained is casual only and he has also suffered a substantial reduction in his wages in his new job and the inconvenience of excessive travel to and from work. Mr Markham has not found alternative employment. He does not appear to have made an effort in that respect, awaiting the outcome of these proceedings. Both employees have suffered financially from their dismissal. 35 Mr Phillips' claim on behalf of Mr Abbott and Mr Markham is for their reinstatement under S.89(1) and for payment to be made under S.89(3) to compensate for loss of earnings from the date of their dismissal to the date of their reinstatement. Mr Phillips acknowledged that the failure of the two employees to isolate the lowering rack was a serious safety breach but he argued that the failure of the two employees was no more than a case of forgetfulness on their part and it did not warrant their dismissal.

36 Mr Mead has resisted that AWU claim, asserting that the evidence before me in this hearing supported his assertion that, with the casual approach to workplace safety that both Mr Abbott and Mr Markham had adopted, they were not suitable for continued employment in the steelworks. He challenged their credibility as witnesses and asserted that their conduct constituted misconduct sufficient to justify their dismissal.

37 It must be appreciated by all steelwork employees that they are working in a particularly hazardous environment and they should always act accordingly. It is not a place for a casual approach to safety issues. That is particularly the position for all work in and around the coke ovens. On my inspection I observed the nature of the work and I was impressed by the range of sensible measures put in place by BlueScope Steel management to protect employees working at that site. But such measures depend to a large extent on the attitude of employees to them.

38 The cardinal rules on safety in the steelworks are therefore now important conditions in the employment contracts for all steelworks employees. As I indicated in Jovanovski v. BlueScope Steel (AIS) Pty Limited (at p.130), viz:

"...I am uncomfortable to intrude in these proceedings in any manner which would possibly undermine the sensible emphasis which BlueScope Steel places on safety issues in the steelworks with its cardinal rules. There is a need for the employees to appreciate that, among other things, their continued employment in the steelworks is largely dependent upon their compliance with those 'cardinal rules'...."

39 The fact remains that it is, of course, always in an employee's own interests to ensure that he acts safely at work at all times. As I indicated in my unreported decision of Friday, 4 March, 2005 in Brown v. BlueScope Steel (AIS) Pty Limited [Matter No.IRC 6429 of 2004], it is important to highlight the obligations placed on all employees under the 2000 Occupational Health and Safety Act to conduct themselves safely at work. In particular, S.20(2) provides as follows:

"An employee must, while at work, co-operate with his or her employer or other person so far as is necessary to enable compliance with any requirement under this Act or the regulations that is imposed in the interests of health, safety and welfare on the employer or any other person."

A penalty is imposed against an employee under S.20(2). And it follows that any employee who fails, wilfully or negligently , to follow safe work practices leaves himself open to disciplinary action by his employer, including dismissal, as has been the case in this instance. The question of whether or not Mr Abbott and Mr Markham had acted wilfully or negligently in their actions in failing to isolate the loading rack was the subject of much discussion in these proceedings but, ultimately, I do not believe that a great deal turns on that distinction.

40 Mr Manzini and Mr Mayne believe that the failure of Mr Abbott and Mr Markham to isolate the loading rack was "deliberate", ie wilful, basing their assertion in that respect essentially on what Mr Markham had earlier stated concerning the incident but which he subsequently denied and continued to deny in his evidence in this hearing. A deliberate act principally denotes to me an intention on the part of the two employees out of which they presumably derive some benefit from their act or omission. I can see no real benefit to Mr Abbott and Mr Markham from their failure to isolate the loading rack, except that they may possibly speed up the job (marginally) - to get to their lunch break earlier, according to Mr Mayne. But there was no pressure placed on Mr Abbott and Mr Markham to speed up their work and, consequently, no real reason to rush the job. 41 To my mind, the word "deliberate" in that context suggests some positive action and not a failure to perform some action. And the motives of Mr Abbott and Mr Markham in failing to isolate the loading rack is essentially within their own knowledge alone.

42 The failure to carry out functions of that nature are often something that employees perform so regularly, that they act by rote and, consequently, they may simply forget to carry out the acts required on certain occasions. That is now the excuse of Mr Abbott and Mr Markham: that they simply forgot to isolate the loading rack. Nevertheless that still constituted a very serious safety breach and not something which BlueScope Steel management may take lightly.

43 Furthermore, I do not accept that the failure of Mr Abbott and Mr Markham to isolate the loading rack was just an oversight on their part. Their evidence is conflicting but it suggests to me that when they performed the second lift, they went to look for a multi-lock for the lowering rack but were not able to find one. They proceeded without one. If that is the case, their claim that they simply forgot to isolate the rack is not really sustainable. Then when Mr Markham observed Mr Murphy at the site, he deduced correctly that he was carrying out a safety audit and knew enough to then go and get the locks to isolate the loading rack. He therefore knew that he and Mr Abbott had not already isolated the equipment and he accepted it as a safety breach.

44 The failure of Mr Abbott and Mr Markham may not have been deliberate, as Mr Manzini asserted in his evidence in this hearing, but it certainly was more than just an oversight on their part. I am satisfied from the evidence before me in this hearing that they were well aware that the loading rack had not been isolated before they commenced working on it and that they both unwisely chose to proceed in full knowledge of that failure to follow important safety procedure. Cutting corners in that way was a very dangerous act. That is especially the case here since neither Mr Abbott nor Mr Markham took the simple expedient of switching off the equipment before they worked on the rack - and I am satisfied from the evidence that was the actual situation. 45 Such a fundamental breach of an important condition of contracts of employment in the steelworks is as Mr Mead described it in his submissions - misconduct: Mr Abbott and Mr Markham recklessly disregarded what I consider to be an essential condition in their contracts of employment at the steelworks [Laws v. London Chronicle (Indicator Newspapers) Limited (1959) 2 All ER 285]. That is sufficient to ground Mr Mead's allegation that they were guilty of misconduct. I do not consider that Mr Mead has to prove their act was deliberate, only that they were recklessly negligent. I believe that they were.

46 I note in that respect the comments of Cook J of the former State Industrial Commission in the Homebush Abattoir Case (1966) AR 371 at p.374), viz:

"…in my view, the question of whether the conduct of an employee amounts to misconduct justifying instant dismissal would generally depend upon whether or not the act complained of can properly be regarded as deliberate or wilful or of such a nature as to strike at an essential element in the contract of service …"

My emphasis. The conduct of Mr Abbott and Mr Markham strikes as the heart of their employment in the steelworks.

47 The failure of Mr Abbott and Mr Markham in that respect only came to light because their work on the loading rack coincided with Mr Murphy's safety audit. I have the suspicion, especially having regard to their employment record, that there may well have been other occasions when their failure to follow well established safety requirements committed by them may have gone undetected.

48 Mr Markham has argued in his evidence in this hearing that the work he was directed to perform on the loading rack was something with which he was unfamiliar. That may be so but the isolation procedure itself was not. Both he and Mr Abbott had received proper training in the isolation procedure and I am satisfied that they both knew its importance but ignored it. And whatever domestic problems Mr Abbott was experiencing at the time does not provide him with an excuse to depart from such critical safety procedure in his own interests and those of the employees with whom he worked. It is the far too casual attitude of the two employees to workplace safety issue described in this hearing which is at the heart of their dismissals.

49 That having been said, and as Mr Phillips submitted in the hearing, in assessing whether to dismiss an employee, an employer should always take into account all the circumstances surrounding the incident which prompted the dismissal, including mitigating factors - in this case, as far as Mr Abbott is concerned, the domestic problems which Mr Abbott was apparently experiencing at the time with his ex-wife and daughter. More importantly, the past satisfactory employment record of the dismissed employee has some relevance as well. In that respect, Watson J of the former Commission commented in Metropolitan Meat Industry Board v. Australasian Meat Industry Employees' Union (1973) AR 231 at p.233 that:

"…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…"

The past employment record of Mr Abbott and Mr Markham helps neither of them in this case, however. And the other side of that coin is that a past unsatisfactory employment record may also tip the scales against the reinstatement of a dismissed employee.

50 In particular, the employment record of Mr Abbott and Mr Markham reveals to me one thing: an unsatisfactory, casual approach to safety issues in general which falls far outside what BlueScope Steel management is entitled to expect of any of its employees, especially those working in the hazardous environment I observed on my inspection. Mr Manzini has argued persuasively in his evidence that the incident on Wednesday, 27 June, 2007 alone was sufficient to form the basis of the decision of BlueScope Steel to summarily terminate the services of Mr Abbott and Mr Markham. I agree. A failure to isolate equipment is a fundamental safety breach. But, in any event, considered in the context of the overall employment record of Mr Abbott and Mr Markham, their offence becomes more significant, in my opinion. This was clearly the straw that broke the camel's back as far as BlueScope Steel was concerned.

51 For instance, in Re Clarke and the Metropolitan Meat Industry Board (1967) AR 16 Cook J of the former Commission commented (at p.27) that:

"…In my view, when an employer is considering whether or not he will exercise his undoubted rights in relation to the selection and retention of employees, subject to the observance of any award requirements, he is entitled to have regard to the previous conduct of an employee. For example, an employee might be late for duty on one occasion and his employer may overlook this. The employee may, likewise, be late on a number of subsequent occasions and the employer may decide not to take any action. If, however, the employee's punctuality does not improve, I would think it clear that an employer would be entitled on the latest instance of unpunctuality to review the record of that employee and if he decided that his record was unsatisfactory and that he no longer wished to retain him in his employment he would have a right to dismiss him by giving the requisite notice of dismissal. In such a case, I think that the employer's action could not ordinarily be said to be such a harsh and unjust exercise of his legal right as to justify an order of reinstatement…"

And in John Lysaght (Australia) Limited v. Federated Ironworkers' Association (1972) AILR Rep.517 Sheppard J of the former Commission commented that a past act of misconduct:

"...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 relevant 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 a dismissal..."

52 For those reasons, I see no grounds for my intervention in support of Mr Abbott or Mr Markham. I dismiss the claims made on their behalf by the AWU.

Abbott, Anthony applicant Manzini, Albert coke making maintenance and asset development manager Markham, David applicant Mayne, Anthony senior human resources advisor (iron and slab) McClure, Andrew senior environment advisor Murphy, Stephen coke making battery production custodian (formerly utilities supervisor) Sainsbury, Shane team leader

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