Arthur Smith and Brett Kimball v Moore Paragon Australia Ltd - PR942856 [2004] AIRC 57; - AIRC 2004 case summary

Arthur Smith and Brett Kimball v Moore Paragon Australia Ltd - PR942856 [2004] AIRC 57; - AIRC 2004 case summary — Zoe

[41]

"We have already set out the terms of s170EE(1)(a)(ii) of the Act. The sub-paragraph empowers the Court to require the employer to reinstate the employee by appointing him or her "to another position on terms and conditions no less favourable than those on which the employee was employed immediately before the termination". This might be a specific position, the availability and suitability of which is revealed by the evidence. On other occasions, the Court will not specify a particular position. Provided that the Court is satisfied that reinstatement is practicable and appropriate, it is open to the Court to make an order in terms of par (a)(ii), leaving it to the employer to choose the position and to comply with the Court's order to provide terms and conditions that are no less favourable than those on which the employee was employed immediately before the termination. If this course is taken, the employer may select an existing position, or he or she may create a new position for the purpose. If the latter, contrary to the submission of counsel for the employer, it will not be to the point that, in the absence of the order, the employer might not have created the position. We appreciate that creation of a new position may occasion a cost, or other disadvantage, to the employer. Where there is evidence that this will be so, that evidence may be relevant on the issues of practicability and appropriateness. But it would be contrary to principle to treat such evidence as necessarily determinative. The occasion for the order arises because the employer has acted unlawfully in terminating the employee's employment. A reinstatement order is akin to an injunction compelling a wrongdoer to restore the position of the innocent party. In considering whether to grant an injunction, a court will always take into account the consequences of an order to the wrongdoer but the existence of adverse consequences has never been regarded as excluding the possibility of an order being made."

[92]

[32] It seems to us that the amounts arrived at by the application of the guidelines in Sprigg in the present matter are on their face manifestly inadequate for employees with the length of service of the Appellants, the circumstances of their dismissal and their poor prospects for future employment. This causes us to sound a warning in relation to the application of Sprigg. The guidelines laid down in Sprigg and refined in Ellawala v Australian Postal Commission[28] are clearly designed to serve the proper and desirable purpose of fostering uniformity and consistency in decision-making by individual members of the Commission when assessing compensation pursuant to s.170CH(6). However, those guidelines are not a substitute for the words of the Act[29]. By virtue of s.170CH(2), any remedy ordered by the Commission must be a remedy that the Commission considers "appropriate" having regard to all the circumstances of the case including the matters set out in s.170CH(2). Section 170CH(6) confers a general discretion "if the Commission considers it appropriate in all the circumstances of the case" to "make an order requiring the employer to pay the employee an amount ordered by Commission in lieu of reinstatement" subject to the Commission having regard "to all the circumstances of the case including" the matters listed in s.170CH(7) - the same list of matters set out in s.170CH(2) - and subject also to the `cap' provided for in s.170CH(8) and (9). If an application of the guidelines in Sprigg yields an amount which appears either clearly excessive or clearly inadequate, then the member should reassess any assumptions or intermediate conclusions made or reached in applying the guidelines so as to ensure that the level of compensation is in an amount that the member considers appropriate having regard "to all the circumstances of the case" including the matters listed in s.170CH(7) and subject to the `cap' provided for in s.170CH(8) and (9). In this context it should be borne in mind that the result yielded by an application of the Sprigg guidelines may vary greatly depending upon particular findings in relation to the various steps including, in particular, step one, which necessarily involves assessments as to future events that will often be problematic.

[168]

Termination of employment - reinstatement - remedy - appeal - full bench - appellants selected for retrenchment on basis of WorkCover history or injury status seek reinstatement - termination found harsh unjust unreasonable on first appeal - reinstatement considered inappropriate as no vacancies and capacity of employees for `modified duties' positions only due to medical condition - appellants not receiving weekly WorkCover benefits until termination yet deducted from remuneration calculations - held - Commission on remittance from first appeal erred in decision on remedy - unavailability of job vacancy only one factor in deciding if reinstatement appropriate - Commission erred by erroneous double deduction for retrenchment benefit and weekly WorkCover benefit - Sprigg guidelines inadequate for long serving appellants, circumstances of their dismissal, and poor prospects for future employment - where using Sprigg guidelines amount clearly excessive or inadequate assumptions of case should be reassessed - assessments of future events often problematic - leave to appeal granted by way of rehearing - no material effect on employer's viability - long service, skill level of appellants and regional location favoured reinstatement - distinction between injury and WorkCover status and incapacity resulting from injury a fine but properly drawn distinction - Blackadder binding in regard to reinstatement to `modified duties' positions - guiding principles when considering reinstatement appropriate for employee with ongoing incapacity outlined - incapacity will remain for foreseeable future - not satisfied if fair selection process that appellants would have been selected for retrenchment - appeal allowed - in all circumstances of the case reinstatement appropriate - reduced capacity a factor against reinstatement but does not outweigh substantial merits - Cosma distinguished - lengthy time since termination - reinstatement ordered to former positions or one no less favourable - continuity of employment - payment of lost remuneration limited to 78 weeks offset by redundancy payments received by appellants - no offset on weekly WorkCover payments received during that period - no immunity from future termination if selection process fair or demonstration that reinstatement imposes an undue burden - obligation to ensure fair go all round.

Arthur Smith and Brett Kimball v Moore Paragon Australia Ltd - PR942856 [2004] AIRC 57;

At a glance

Court

Decision date

Source

Judgment (204 paragraphs)

Arthur Smith and Brett Kimball v Moore Paragon Australia Ltd - PR942856 [2004] AIRC 57; (20 January 2004)

Parties

Legislation Cited (4)

Cases Cited (13)