Australian Telecommunications Commission v Hart

Public Service Act 1922 (Cth), s56 Public Service Regulations (Cth) Attorney-General for the United Kingdom v Heinemann Publishers Australia Pty Ltd (1987) 10 NSWLR 86 Blyth Chemicals Ltd v Bushnell (1933) 49 CLR 66 Byrne v Australian Airlines Ltd (1995) 131 ALR 422 Ex parte Kearney (1917) 17 SR(NSW) 578 Fowell v Ioannou (1982) 45 ALR 491 Gould v Stuart [1896] AC 575 Main v Stark (1890) 15 App Cas 384 Olmstead v United States 277 US 438 ADMINISTRATIVE LAW - Judicial Review - application for extension of time to commence proceedings - application for extension and substantive issue heard together - relevance of alternative review procedures - importance of issue in substantive application going beyond parties' interest - whether prejudice to respondent - extension granted. Administrative Decisions (Judicial Review) Act 1977: s10(2)(b)(ii); s11(1)(c) Boral Gas (NSW) Pty Ltd v Magill (1993) 32 NSWLR 501 Bragg v The Secretary, Department of Employment, Education and Training, Federal Court of Australia, Davies J, 8 June 1995 Comcare v A'Hearn (1993) 18 AAR 366 Hunter Valley Development Pty Ltd v Minister for Home Affairs and Environment (1984) 58 ALR 305 Swan Portland Cement Ltd v Comptroller-General of Customs (1989) 25 FCR 523 GRAHAM GEORGE CLIVE McMANUS v ROBIN SCOTT-CHARLTON No ACT G80 of 1995

IN THE FEDERAL COURT OF AUSTRALIA) ) AUSTRALIAN CAPITAL TERRITORY ) ) No. ACT G 80 of 1995 DISTRICT REGISTRY ) ) GENERAL DIVISION )

BETWEEN: GRAHAM GEORGE CLIVE McMANUS Applicant AND: ROBIN SCOTT-CHARLTON Respondent COURT: FINN J. PLACE: CANBERRA DATE: 15 OCTOBER 1996

THE COURT ORDERS THAT:

1. The time in which to lodge the application be extended.
2. The application be dismissed with costs. Note: Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.

IN THE FEDERAL COURT OF AUSTRALIA) ) AUSTRALIAN CAPITAL TERRITORY ) ) No. ACT G 80 of 1995 DISTRICT REGISTRY ) ) GENERAL DIVISION )

BETWEEN: GRAHAM GEORGE CLIVE McMANUS Applicant AND: ROBIN SCOTT-CHARLTON Respondent COURT: FINN J. PLACE: CANBERRA DATE: 15 OCTOBER 1996

REASONS FOR JUDGMENT This in form is an application for an extension of time in which to lodge an application for an order of review under the Administrative Decisions (Judicial Review) Act 1977 ("the ADJR Act"), s11(1)(c). In consequence of directions I had earlier given, both the extension application and the order of review application were heard together. The extension application was opposed by Mr Scott-Charlton, the respondent, on the grounds that (1) it would not be appropriate in any event to grant relief in the order of review application given the alternative review procedure provided to, though not availed of by, Mr McManus, the applicant, under the Public Service Act 1922 (Cth) ("the PS Act"), s63D: see the ADJR Act, s10(2)(b)(ii); Swan Portland Cement Ltd v Comptroller-General of Customs (1989) 25 FCR 523; Boral Gas (NSW) Pty Ltd v Magill (1993) 32 NSWLR 501 esp at 511-512; Bragg v The Secretary, Department of Employment, Education and Training, Federal Court of Australia, Davies J, 8 June 1995; and (2) the extension application itself should, as a matter of discretion be refused, because the delay of somewhat over 2 months in making the application had not reasonably be explained and because Mr McManus over time had opportunities (again not taken) to raise the issue that he seeks to agitate in the order of review: see Comcare v A'Hearn (1993) 18 AAR 366; Hunter Valley Development Pty Ltd v Minister for Home Affairs and Environment (1984) 58 ALR 305. The applicant is now out of time in exercising his appeal rights under the PS Act, s63D: but cf Public Service Regulations (Cth) ("the PS Regulations"), reg 141(2) and Caldwell v Smith (No 2) (1983) 51 ALR 394. Nonetheless, the issue of substance he seeks to have determined has been fully argued before me. Though narrow, it has an importance which goes significantly beyond the resolution of this particular case. For this reason, I have considered it appropriate formally to grant the extension application. In so doing, I should not be taken as having expressed a concluded view on the matters raised in the respondent's submissions in opposition to the extension application. Given that my decision is to dismiss the order of review application, the course I have taken is not disadvantageous to the respondent; it provides the applicant with the hearing he seeks; and it allows for a decision to be given on the real issue raised. The Setting of the Order of Review Application The applicant's complaint arises out of disciplinary proceedings taken against him under the PS Act. He holds an administrative officer position in AusAID. The charge against him was that he wilfully disregarded a direction given to him with which it was his duty as an officer to comply. The particulars of that charge were that: "On the evening of 3 July 1995, you wilfully disregarded a written direction given by Assistant Director General, Financial and Resource Management Branch, Mr Michael Robin Casson, on 18 January 1995 ... that you refrain from contacting Ms Penny Bond, an officer of AusAID, outside the requirements of your official duties, in that you made a personal telephone call to Ms Bond at her place of residence." I will return below to the circumstances precipitating this direction. The charge against Mr McManus was found made out by the respondent who had been appointed to hold an inquiry under the PS Act, s62(1). Consequential disciplinary action was taken against him. The sanction imposed was a salary reduction. Though the order of review itself is unilluminating as to the applicant's actual ground of complaint, it has in the hearing before me resolved itself into a single issue: was the direction given on 18 January 1995 a lawful and reasonable one? If it was not, the applicant was not obliged to comply with it. The substance of the direction is set out in the particulars of charge above. Here I merely note that the making of it was preceded by a number of unwelcomed advances made to Ms Bond (as also to other women officers in AusAID) which, after complaint, resulted in both the counselling of, and the giving of other directions to, the applicant. To appreciate the basis of the issue so raised in this application, it is necessary first to refer to provisions both of the PS Act and the PS Regulations. The Statutory Scheme Notwithstanding that the applicant was charged with only one of the forms of misconduct envisaged by the PS Act s56, it is necessary in light of his submissions to set out the terms of the section in full. It provides: "56.For the purposes of this Subdivision and Subdivisions B, C and E, an officer shall be taken to have failed to fulfil his duty as an officer if and only if: (a) he wilfully disobeys, or wilfully disregards, a direction given by a person having authority to give the direction, being a direction with which it is his duty as an officer to comply; (b) he is inefficient, or incompetent for reasons or causes within his own control;

(c) he is negligent or careless in the discharge of his duties; (d) he engages in improper conduct as an officer; (e) he engages in improper conduct otherwise than as an officer, being conduct that affects adversely the performance of his duties or brings the Service into disrepute; (ea)the officer engages in conduct (including patronage, favouritism or discrimination) in breach of section 33; (f) he contravenes or fails to comply with: (i) a provision of this Act, of the regulations or of a determination in force under subsection 9 (7A) or section 82D, being a provision that is applicable to him; or (ii)the terms and conditions upon which he is employed; or (g) he has, whether before or after becoming an officer, wilfully supplied to an officer or another person acting on behalf of the Commonwealth incorrect or misleading information in connexion with his appointment to the Service." The charge against the applicant alleged misconduct of the type referred to in s56(a), ie the wilful disregard of a direction. It is the PS Regulations in turn which describe the directions with which compliance is required. Regulation 8A provides (inter alia): "An officer shall: ... (c) comply with any lawful and reasonable direction given by a person having authority to give the direction; ... " Finally reference should be made to the "chief object" of the PS Act. Section 6 of the Act provides: "The chief object of this Act is to constitute a public service for the efficient, equitable and proper conduct, in accordance with sound management practices (including personnel management practices), of the public administration of the Australian Government and this Act shall be construed accordingly." Put shortly, it is the applicant's submission that the direction given him concerning Ms Bond, was not a lawful or reasonable direction because it was not related to the performance of his employment duties. The actual terms of that direction, conveyed to him in a letter of 18 January 1995, were that: "You are formally directed to refrain from contacting Ms Penny Bond in future outside the requirements of official duties." It is further submitted that, if complaint is to be made of improper conduct outside of work hours which is unrelated to employment duties, then the PS Act s56(e) provides the proper basis for such complaint: Mr McManus was not charged with s56(e) conduct. It is not disputed that the conduct constituting the disregard of the direction was an unsolicited telephone call made to Ms Bond at her private residence on the evening of 3 July 1995. Before considering the efficacy or otherwise of the particular direction given here, it is appropriate to comment first on the permissible scope of employer directions to employees. Lawful and Reasonable Directions The accepted view in this Court is that it is the common law obligation of an employee to obey the lawful and reasonable commands or directions of the employer: see Australian Telecommunications Commission v Hart (1982) 43 ALR 165; Bayley v Osborne (1984) 4 FCR 141; for a different view on the matter of reasonableness see 10 Halsbury's Laws of Australia, "Employment", para 165-265, but cf Creighton, Ford and Mitchell, Labour Law, paras 8.2 - 8.8. The PS Regulations, reg 8A(c) to which reference has been made above reflects this position, albeit it makes the obligation statutory as well. The "standard or test" of the lawfulness of a command or direction that has been adopted in this Court for common law purposes is that of Dixon J in R v Darling Island Stevedoring and Lighterage Co Ltd; Ex parte Halliday and Sullivan (1938) 60 CLR 601 at 621-622: "If a command relates to the subject matter of the employment and involves no illegality, the obligation of the servant to obey it depends at common law upon its being reasonable. In other words the lawful commands of an employer which an employee must obey are those which fall within the scope of the contract of service and are reasonable." (Emphasis added). It will be necessary to return to the italicised words. For the moment I need merely observe that I have been asked to assume that this test is an appropriate one to apply in the construction of reg 8A(c) - although, as I will indicate, it is not perhaps as helpful in the resolution of this application as counsel may have assumed. Questions of illegality and reasonableness apart, the alternate formulations of lawfulness proposed by Dixon J are that the command "relates to the subject matter of the employment" or falls "within the scope of the contract of service." It is clear that these were intended to be synonymous in the limitation they expressed. The need for some such limitation is patent: employment does not entail the total subordination of an employee's autonomy to the commands of the employer. As was said by the President in Australian Tramway Employees' Association v Brisbane Tramways Co Ltd (1912) 6 CAR 35 at 42: "A servant has to obey lawful commands, not all commands. The servant does not commit a breach of duty if he refuse to attend a particular church, or to wear a certain maker's singlets. The common law right of an employee is a right to wear what he chooses, to act as he chooses, in matters not affecting his work." There are obvious, and powerful, considerations of civil rights and liberties and of due process which inform this. These need not be laboured here although they are of no little significance in the resolution of this case. It equally is not surprising that the limitation has for some time now characteristically been expressed by reference to the "subject matter of the employment" or to the "scope of the contract". As McHugh and Gummow JJ observed in Byrne v Australian Airlines Ltd (1995) 131 ALR 422 at 439: "The evolution in the common law as to the relationship of employment has been seen as a classic illustration of the shift from status (that of master and servant) to that of contract (between employer and employee)."

The limitation as formulated is, though, problematic in a case such as this. If the limitation's reference to the "subject matter of the employment" should properly be taken as referring to the service contracted to be rendered and/or to the manner of its rendering - to the "what", "how" and "when" of the job: cf Creighton et al, Labour Law, para 8.2 - then the present direction would not, in my view, fall within what the limitation would seemingly allow. However, for reasons which I give below, I do not regard the issue arising in this case as one capable of resolution by the application of formulae which are general in character and which for that reason do not take account of distinctive or anomalous circumstances. It is now well accepted in this country that the "fundamental legal relationship" between the Crown and public servants is "contractual in character": Fowell v Ioannou (1982) 45 ALR 491. Nonetheless, as Byrne's case, above, itself illustrates, contract does not provide an adequate explanation of the possible incidents of the ordinary employment relationship, let alone of the constitutionally distinctive one of Crown and public servant. Neither, in my view, does reference to the "contract of service" or "the subject matter of the employment" provide a satisfactory explanation in any event of the matters which may properly be the subject today of lawful and reasonable direction to public servants under reg 8A(c). There are several reasons for this not the least of which is that there are interests and values beyond those relating merely to bare matters of employment which the Crown has the right or the obligation to protect - though, as I will note below, these values and interests are of no particular concern in this application. Before turning to what properly may be the subject matter of a direction, it is appropriate first to refer to the power to give directions itself. Public service regulations have, characteristically, contained a directions giving power since the advent of public service legislation in this country in colonial Victoria in 1862: see Act No 160 of 1862 and Civil Service Regulations 1867, reg 9. I have referred above to reg 8A(c) of the PS Regulations. In light of a submission made by the applicant it is necessary to comment on reg 8A and the PS Act disciplinary scheme generally in a little detail. The regulation itself was enacted in response to a recommendation made by the 1976 Royal Commission on Australian Government Administration: see Report, para 8.5.56. The Royal Commission suggested that "only the more important [duties] should be set down by statute": para 8.5.58. While its recommended list and that finally enacted diverge in some degree, it is clear that what has found its way into reg 8A is by no means an exhaustive statement of a public servant's duties. When the duties enumerated in the regulation are placed alongside the "duties" the failure to fulfil which can constitute misconduct for disciplinary purposes - see PS Act s56 - there is not at all a direct correlation between the two. This has led to the submission by the applicant that, whatever may be said of the duties of reg 8A; (i) those enumerated in s56 are exhaustive of the "duties" that can attract disciplinary consequences under Subdivisions A, B, C and E of Division 6 of the PS Act; and (ii) they are, as between themselves, mutually exclusive. Before turning to this submission, I would note that the 1976 Royal Commission expressly refrained from including in the list of duties now reflected in reg 8A, any reference to an officer's private conduct: "8.5.65 The Commission has given serious thought to whether the duties referred to in the Act should refer in any way to 'improper conduct' outside the performance of professional duties, that is in the private life of the officer concerned. While the Commission can envisage circumstances in which such conduct could impair the officer's capacity to perform his work efficiently or could bring the Service into disrepute, it has decided not to recommend any specific reference to obligations in respect of private behaviour. We believe such behaviour is relevant only in so far as it bears generally or specifically upon the performance of official duties. ... "

Turning now to the applicant's submission, the first of the two propositions advanced - ie that s56 provides an exhaustive list of "disciplinary duties" - is incontrovertible as the language of the section makes plain. The second is not. It is the case that s56(e) of the Act stipulates circumstances in which "improper conduct otherwise than as an officer" (ie private conduct) can constitute a breach of duty for disciplinary purposes. From this I am invited to conclude (a) that if complaint at all is to be made of private conduct, this must be done under s56(e); and (b) that the power to give directions assumed by reg 8A (and given disciplinary recognition by s56(a)) does not, in consequence, extend to directions relating to private conduct. I am unable to accept either of these conclusions as ones arising out of a proper construction of s56. First, as I will later note, the PS Act and PS Regulations deal directly with a number of specific forms of private conduct of public servants: outside work; private disclosure of official information; etc. As counsel for the respondent submitted, it is not at all obvious why these matters may not be the subject of lawful and reasonable direction in a particular instance given that they have been made proper subjects of employment regulation. On the contrary. Secondly, it is for example clear that conduct falling within other sub-clauses of s56 - and in particular s56(c) and s56(d) - may occur as a result of the wilful disregard of a direction falling within s56(a). I see no reason why in such a case a public servant cannot be charged with the s56(a) misconduct notwithstanding that a distinct charge may be brought under another sub-clause. There is, in my view, scope for overlap between s56(a) and some at least of the other sub-clauses of s56. Section 56(e) is one such sub-clause. In consequence I reject both of the applicant's submissions on this. I have earlier suggested that the limiting formula used by Dixon J in Ex parte Halliday, above, to test the lawfulness of a direction to an employee may not, in its focus on "the subject matter of the employment"/"the scope of the contract of service", satisfactorily capture what properly may be the subject matter of directions to public servants today. There are several reasons for this. One is that the obligations imposed upon public servants and the powers given the Crown as employer do not all exist merely for employment related purposes. Some are designed to preserve and promote other public interests. I enlarge on this below. Another is that legislation, increasingly, is making the workplace a forum in which human rights are being accorded some level of protection both from the actions of employers and from co-workers. As a result, workplace behaviour and its consequences are being made matters of legitimate interest or concern to employers and employees alike. Insofar as employers are concerned it can, as I will suggest, necessitate some legitimate level of supervision of the relationship of employees inter se and this if, for no other reason, than to protect the interests of the employer from adverse effects that can flow from employee misconduct. I mention both of these matters for these purposes. (i) They may in some circumstances bring more sharply into focus the factor or factors that legitimate the regulation of employee conduct than will be the case with the limiting formulae noted. Those formulae, in any event, are more in the nature of statements of conclusion than of reasons for conclusions. (ii) Each of the matters I have mentioned, albeit in different ways, provides justification in some degree for the regulation of private conduct, or else conduct not connected with the discharge of official duties as such. As to (ii) above, it needs to be said that, because conduct is engaged in otherwise than at work, it is not for that reason alone precluded from being a matter of legitimate interest to an employer. The PS Act, s56(e) is testament to this as is case law on an employee's duty to serve with good faith and fidelity: see eg Hivac Ltd v Park Royal Scientific Instruments Ltd [1946] Ch 169; Schilling v Kidd Garrett Ltd [1977] 1 NZLR 243; Bartlett v Shoe and Leather Record [1960] CLY 1151 - an extreme case see [1960] JBL 362; and on "off-duty" misconduct in a public sector setting see R v Railways Appeal Board; Ex parte Haran [1969] WAR 13. The Crown-Public Servant Relationship I have earlier suggested that a contractual analysis of this relationship does not provide an adequate explanation of its incidents, nor, of the matters which are appropriately the subject of regulation within it. This is not the place to canvas this matter in any detail. Suffice it to say that contract initially provided, and continues to provide, a convenient but not altogether apt medium to explain the enforceability of a legislative innovation in this country that had - and still has - no counterpart in Britain. When Victoria initiated the colonial experiment of placing its "civil service" on a statutory basis in Act No 160 of 1862 - an experiment copied progressively across colonial Australia and adopted as an early expedient of the Australian Parliament on federation - it not only departed radically from the prerogative-based civil service system then emerging in Britain, it also by so doing allowed for the possibility of action by public servants to enforce the statutory rights and protections they had so acquired. Given that mandamus did not lie against the Crown, but that early Crown proceedings legislation allowed for contractual claims, public service legislation was for enforcement purposes partially "contractualised": see eg Gould v Stuart [1896] AC 575; see also G S Robertson, Civil Proceedings By and Against the Crown, 354 ff, Stevens and Sons, 1908. I note "partially" because where public service Act duties/functions were imposed on designated officials, their discharge was amenable to challenge and enforcement through the prerogative writs: see eg Main v Stark (1890) 15 App Cas 384. This bifurcation of remedy between contract and public law is manifest in the present proceedings. The matter of emphasis, though, is that public service legislation served - and serves - public and constitutional purposes as well as bare employment ones. This is not at all surprising given (i) that such legislation provides for the marshalling of the human machinery to implement the exercise of executive power constitutionally vested in the Crown - and hence facilitates government carrying into effect its constitutional obligation to act in the public interest: Attorney-General for the United Kingdom v Heinemann Publishers Australia Pty Ltd (1987) 10 NSWLR 86 at 191; and (ii) the distinctive position as public officers that public servants in consequence occupy (though not invariably: cf Ex parte Kearney (1917) 17 SR(NSW) 578) in our governmental order. As to the latter I would merely note that, quite apart from employment obligations, that position can give rise to duties and liabilities to the public directly - as the common law has long recognised: see eg Northern Territory of Australia v Mengel (1995) 129 ALR 1.

From 1862, Australian public service legislation has imposed strictures and limitations upon the employment and non-employment (or private) conduct and activities of public servants; the acquisition of personal interests conflicting with duties of office: cf PS Regulations, reg 8B; holding outside offices or employment: cf PS Act s91; making private disclosures of official information: cf PS Regulations, reg 35; and see also PS Regulations, reg 8A(i) and regs 65 and 70. It seems clear that some number of these strictures and limitations were - and are - not designed merely to serve the purposes of the employment relationship as such. Rather, for reasons of governmental and public interest, their object includes securing values proper to be required of a public service in our system of government and, in particular, the maintenance of public confidence in the integrity of the public service and of public servants: for a contemporary treatment of this, see generally Electoral and Administrative Review Commission, Report on the Review of Codes of Conduct for Public Officials, (1992, Qld). For this reason public service Acts and regulations have in some respects gone considerably beyond what would be countenanced by the implied contractual duty of an ordinary employee to serve his or her employer with good faith and fidelity - at least insofar as the regulation of an employee's private activities are concerned: on this implied contractual duty, see eg Blyth Chemicals Ltd v Bushnell (1933) 49 CLR 66 at 81-82. Perhaps the most contentious illustrations of this legislative regulation of private conduct have been (i) the changing supervision of the political activity of public servants (initially taking the form of a total ban: see Civil Service Regulations 1867 (Vic) reg 23;) but see now eg "Guidelines on Official Conduct of Commonwealth Public Servants" (1995) Chs 5 and 6; and for a comparative treatment see, Ontario Law Reform Commission, Report on Political Activity, Public Comment and Disclosure by Crown Employees (1986); and (ii) the still exceptionally broad and, perhaps today, possibly invalid prohibitions imposed on the private use made of information "of which an officer ... has knowledge officially": see PS Regulations, reg 35. The particular point I wish to make about this enduring and legislatively backed "public interest" regulation of the private conduct of public servants are these. First, to the extent that private conduct is made the lawful subject of employment regulation, it can for that reason provide the subject of a binding employment direction - provided the direction given is itself reasonable. Counsel for the applicant has submitted in contrast that the only binding directions which can be given a public servant are those related to - which have a nexus with - the performance of that person's employment duties. In light of what I have said so far, this submission is untenable as a generalisation. Secondly, there remains the question, though, whether the type of direction such as given in the present case was itself a proper one with which the applicant was obliged to comply. That direction was not related to any regulatory provision of the PS Act and PS Regulations dealing with private conduct, and it cannot be justified by reference to the constitutional/public interest considerations which, in turn, justify such regulatory provisions. Neither can it find its possible justification as a direction concerning conduct that "affects adversely the performance of his duties" or that "brings the Service into disrepute" and, as such, inferentially contemplated by the PS Act s56(e). The direction was unrelated to such considerations. I emphasise this because, while the PS Act and PS Regulations at least indicate that private conduct can be the subject of legitimate interest to the Crown - and the respondent has relied upon this in its submission - that Act and those Regulations do not in terms provide any lawful justification for the direction with which I am concerned here. If it is to have justification, this must be found elsewhere.

Protecting Legitimate Employer Interests/Discharging Employer Obligations The PS Act and Regulations do not exhaust the sources of the respective rights and obligations arising out of, and the incidents of, the Crown-public servant employment relationship. There are others. First, there are those statutes of general application to employers which by their own force (cf Sex Discrimination Act 1984 (Cth), s12), or as a result of Crown proceedings legislation (see Strods v Commonwealth of Australia [1982] 2 NSWLR 182), impose - or have the de facto effect of imposing - obligations and prohibitions on the Crown as employer. Secondly, there is the employment related "mass of terms and conditions imposed and conferred by a multitude of Commonwealth Acts and Regulations": Fowell v Ioannou, above, at 500: see eg Safety Rehabilitation and Compensation Act 1988. There doubtless are additional sources beyond the two mentioned: see Creighton et al, Labour Law, Ch 5. Insofar as the present application is concerned, it is the Sex Discrimination Act ("the SD Act") which is of no little significance. Section 28B(2) of that Act makes it unlawful (inter alia) - "for an employee to sexually harass a fellow employee..." I would note of this provision: (i) that, unlike sections 28G, 28H and 28L, but like sections 28D and 28F, it makes the holding of a particular status or position vis-a-vis the person harassed, and not the place or circumstance of the harassment, the condition upon which the unlawfulness of the harassing conduct is premised; but, (ii)that, because of the SD Act s9(5), s28B only has effect in relation to sexual harassment of Commonwealth employees "in connection with their employment as Commonwealth employees". I will return to this Commonwealth employee limitation. "Sexual harassment" is defined in s28 A(1) as follows: "For the purposes of this Division, a person sexually harasses another person (the "person harassed") if: (a) the person makes an unwelcome sexual advance, or an unwelcome request for sexual favours, to the person harassed; or (b) engages in other unwelcome conduct of a sexual nature in relation to the person harassed; in circumstances in which a reasonable person, having regard to all the circumstances, would have anticipated that the person harassed would be offended, humiliated or intimidated." The legislation bears on the Commonwealth in a variety of ways. First, all Commonwealth employees are deemed to be employed by the Commonwealth for the Act's purposes: SD Act, s108. Secondly, while the Act imposes "vicarious liability" on an employer in respect of s28B harassment committed by an employee "in connection with the employment" - SD Act, s106(1) (emphasis added) - that liability will not be attracted if it is established that the employer took "all reasonable steps" to prevent the employee doing acts of the kind constituting the sexual harassment of a fellow employee: SD Act, s106(2). I need not pause here to consider whether the "all reasonable steps" provision could justify the taking of preventative measures in relation to private conduct (eg selective anti-fraternisation measures) for the purpose of safeguarding against forms of harassment in the workplace: but see Lindemann and Kadue, Sexual Harassment in Employment Law, Bureau of National Affairs, Washington, 1992 at 422ff. This legislation puts beyond any doubt that sexual harassment of Commonwealth employees by fellow Commonwealth employees is a subject of legitimate interest to the Commonwealth in its regulation and management of the employment related conduct of its employees. This view the Commonwealth has reasonably and responsibly taken and acted upon: see the Public Service Commission's Guidelines on Eliminating Sexual Harassment, and Guidelines on Eliminating Workplace Harassment. The "all reasonable steps to prevent harassment" provisions of s106(2) of the Act provide an appropriate legal foundation for that interest. What is important, though, is to note how far the statute of itself can be said to go in mandating employer regulation of employee conduct. In my opinion, notwithstanding such individual view as an employer might have of the need to proscribe an employee's private, sexually harassing conduct of a co-worker and no matter how powerfully that view may be held, the SD Act alone does not provide justification for the use of binding employment directions to that end. That Act makes an employee's conduct towards a co-worker of legitimate interest to an employer for employment regulation purposes, if the conduct occurs "in connection with the employment of the employee". Beyond this, reliance on the SD Act alone will not justify employee regulation by way of direction notwithstanding this may well seem to an employer to be a reasonable and indeed desirable intervention to protect a co-worker from privately committed acts of harassment. While the acts of the Samaritan may be laudable, they do not for that reason attract legal force to the measures taken against the perpetrator of wrongful private conduct. More is required. In saying this I should, perhaps, add that no submission has been made seeking to justify the direction by reference, not to the express terms of the SD Act, but to its "equity": cf Nelson v Nelson (1995) 132 ALR 133 esp at 144-145 per Deane and Gummow JJ. I have emphasised above that the SD Act alone would not justify such a direction to an employee as was given in the present case. This, though, is not to say that the prevention of sexual harassment is without present significance. Far from it. The conduct which the relevant senior officer in AusAID believed the applicant to have engaged in, and against which the direction was made, was conduct considered (inter alia) to constitute sexual harassment under the SD Act. That it occurred away from the workplace would not alter this aspect of its character: the s28A definition is not locationally limited. Whether the conduct might also have proved to be unlawful under s28B would depend upon whether it was harassment of Ms Bond "in connection with [her] employment as [a] Commonwealth employee": SD Act, s9(5). This particular matter was not the subject of argument before me. I refrain from expressing a view on it. Notwithstanding that it is appropriate to expect the Commonwealth to act as a "moral exemplar" - cf Olmstead v United States 277 US 438 at 485 (1928) - in its regulation of the employment relation, a concern for eliminating privately occurring sexual harassment by, and of, co-employees would not of itself have justified an employment direction. But, as will be seen, such was not the justification given for the direction. Far more direct interests of the Commonwealth were put at stake in consequence of the actions of the applicant. Subject to the conditions I will later mention, the protection of these interests could justify a direction relating to privately occurring sexual harassment. First, while the applicant's conduct may not have been engaged in "in connection with" his employment, it can still properly be said to have a relationship to - to be attributable to - that employment. It was knowledge and acquaintance provided by his position with AusAID that resulted in the various co-employees who made official complaint of his conduct being subjected to sexual harassment. Where such utilisation of position does occur in relation to one or some number of co-employees, it provides a direct linkage between the harassment and the co-employee status of both the harasser and the person harassed. That linkage is important, in my view, not because it would of itself justify an employer direction, but because it properly allows the harassment to be characterised as employment related. Furthermore where such utilisation of position becomes a cause of apprehension for other co-employees because of their employment, an employer may well have a legitimate interest in addressing such behaviour because of its relationship to the employment and of its consequences in the workplace. Given the particular circumstances of this case, it is not necessary for me to express a view as to when, if at all, co-employee apprehension of the type mentioned would be sufficient alone to justify a direction proscribing the private harassing conduct. Secondly, once an employee's conduct can be shown to have significant and adverse effects in the workplace - because of its impact on workplace relations, on the productivity of others, or on the effective conduct of the employer's business

• that conduct becomes a proper matter of legitimate concern to an employer, and does so because of its consequences. In the usual case where this employer concern arises the focus is on conduct occurring in the workplace itself. There is some, though by no means voluminous, case law reflecting this: see eg Re Greenleaf Fertilisers Ltd, Industrial Commission (NSW), 28 June, No 198 of 1978, per Liddy J who held that an employee had an implied contractual duty to the employer to act in a reasonable manner towards his fellow workers; see also Secretary of State for Employment v Associated Society of Locomotive Engineers and Firemen (No 2) [1972] 2 QB 455. The reason for this, often enough, is that for it to have the effect in question, it needs to occur in the workplace. There can, though, be circumstances - of which the private sexual harassment of a co-employee is an example - where conduct outside the workplace can occasion adverse workplace effects. The reason for this is that the continuing workplace proximity of the harasser and the person harassed can cause the impact of the harassment on the person harassed to endure into the workplace. It is this which in turn is capable of occasioning the effects I have been discussing. As I will later indicate, such a state of affairs was believed to exist in the present case when the impugned direction was given. I would note in passing on this matter of consequences in the workplace that counsel for the applicant placed some emphasis - properly in my view - on the need for an employer to be sensitive to its potential liability to employees for "injury" (cf Safety Rehabilitation and Compensation Act 1988, s4) sustained in or as a consequence of the workplace environment; see also T MacDermott, "The Duty to Provide a Harassment-Free Work Environment", (1995) 37 Jo of Indust Rels 495. I am mindful of the caution that should be exercised when any extension is made to the supervision allowed an employer over the private activities of an employee. It needs to be carefully contained and fully justified. Nonetheless I am prepared to conclude that circumstances may exist which would justify an employer direction proscribing the private sexual harassment of an employee by a co-employee. In my view, an amalgam of the various matters to which I have been referring provide both appropriate justification for, and limitation upon, giving such a direction. I should emphasise that my comments are limited to co-employee sexual harassment - conduct which is intrinsically opprobrious (and recognised as such in the SD Act s28A) and which is unlawful if connected with the harasser's employment. My conclusion is, then, that it is lawful for an employer to give an employee a direction to prevent the repetition of privately engaged in sexual harassment of a co-employee where: (i) that harassment can reasonably be said to be a consequence of the relationship of the parties as co-employees (ie it is employment related); and (ii)the harassment has had and continues to have substantial and adverse effects on workplace relations, workplace performance and/or the "efficient equitable and proper conduct" (cf PS Act, s6) of the employer's business because of the proximity of the harasser and the harassed person in the workplace. This may be formulated somewhat more narrowly than is necessary, but it is sufficient for present purposes. Given some of the objections raised by counsel for the applicant against allowing any employer direction against the privately engaged in sexual harassment of a co-employee, I should indicate that the test of lawfulness set out above would not, for example, be likely to justify a direction given against an employee privately harassing a co-employee with whom he or she cohabited or was married, but from who he or she was later estranged. Such a direction would, because of the prior relationship of the parties, be unlikely to satisfy the first of the two conditions noted above.

It is the case, though, that a direction while lawful may not in fact be binding and this because of the separate requirement that the actual direction given must itself be reasonable. I now turn to this second requirement. Reasonable Directions Whatever may be the appropriate approach to take where the direction to be given relates to the "what", "how" and "when" of the employment contracted to be performed, where it relates to private conduct it seems not inappropriate to use the emerging concept of proportionality to test the propriety or otherwise of the direction actually given where lawful justification exists for giving a direction: on proportionality see eg State of New South Wales v Macquarie Bank Ltd (1992) 30 NSWLR 307 per Kirby P esp at 322; Minister for Resources v Dover Fisheries Pty Ltd (1993) 43 FCR 565; and for the diversity in its use see Jowell and Lester, "Proportionality: Neither Novel nor Dangerous", in Jowell and Oliver (eds), New Directions in Judicial Review, Stevens and Sons, 1988. Not only is one here concerned with evaluating both the means selected in the direction given and the consequences obedience to it will occasion to the employee in light of the justification that exists for giving the direction, one also is undertaking that evaluation in a context in which an employer's intrusion into the private affairs of the employee is itself exceptional and requires critical scrutiny. Little more needs to be said of this requirement at this stage. The reasonableness/proportionality question is essentially one of fact and balance. The Direction Given and its Attendant Circumstances I should emphasise at the outset that the applicant does not challenge any of the factual findings made by the respondent in making the determination impugned in these proceedings. Neither does he challenge the reasons given by the officer, Mr Casson, who was authorised to, and did, make the direction which is said not to be a lawful and reasonable direction. A brief chronology is, in the circumstances, sufficient in my view to indicate both that the giving of a direction was justified in the circumstances and that the direction given was a reasonable one. Mr Casson had reason to believe that the applicant had unwanted contact (both workplace and private) with Ms Bond in 1990 and 1993. That it was unwanted was said to have been communicated to Mr McManus. More significant for present purposes, on 25 November 1994 Mr McManus left a message on Ms Bond's home answering machine that was cast in terms which recognised that the approach was probably unwanted and was capable of causing concern and offence. The opening sentences were: ".....Call. Well you won't be so pleased that I've called because you know I'm not supposed to call. I thought I might call anyway 'cause .. um ..I've always sort of fancied you so I though (sic) I might as well tell you that .. um .. if you're ever free I wouldn't mind marrying you. So anyway, ah, that's said and .. um .. nobody else knows I've called so .. um .. you don't have to blow up at me and .. um." This call was made on a Friday. On the following Monday, Ms Bond brought the matter to the attention of Mr Casson. She is said to have indicated that she was upset at again being disturbed by the applicant and that she was very concerned. Ms Bond was not the only female officer in AusAID who in 1994 alleged she had been the object of private and unwanted approach and who had lodged official complaints about his actions. Two other officers alleged similar experiences. In the case of one of these, the applicant's actions were such as to lead Mr Casson to conclude that the applicant was a potential physical threat. Mr McManus had been confronted and counselled in relation to one of the other officers (Ms Nesbitt) who left AusAID shortly thereafter. On 29 November the applicant was directed formally not to make contact with Ms Bond either within or without work hours. On December 2 1994 he was formally counselled in relation to his call to Ms Bond. After undertaking an officially prescribed medical examination in late December 1994 which indicated that there was no apparent physical or mental ailment suffered by the applicant, he was again counselled concerning his approaches to Ms Bond. For convenience I set out here the relevant paragraphs of Mr Casson's affidavit which detail this counselling and its sequel. "20.On 18 January 1995 I counselled the Applicant in the presence of Mr John Domitrak, Manager Staffing in AusAID. I said words to the effect 'You are not to approach Penny Bond outside the requirements of your official duties. You are also not to approach either Julia Nesbitt or Caron McIntosh outside the requirements of your official duties.' I then gave the Applicant a written copy of the direction. This action was given as a formal warning to the Applicant. ... 21.I gave the direction to the Applicant in order to protect the interests of female staff of AusAID and their ability to freely go about their duties without worrying about receiving unwelcome approaches of a sexually harassing nature from the Applicant. I did not regard this as a matter which should be referred to the police. There is a women's network within AusAID and I was aware that the Applicant's behaviour had been of concern to the members of that network. The Applicant's actions were causing concern to the members of staff affected and adversely affecting their work performance. I formed the opinion that Ms Bond and Ms Nesbitt were emotionally disturbed by the Applicant's actions to a degree that they were using work time discussing their concerns with myself, the EEO officer and the Director of the staffing section. I formed the opinion that Ms Bond and Ms Nesbitt were paying reduced attention to their duties, to the detriment of their work, because their concern about the Applicant was preying on their minds. Both myself and other members of the personnel section of AusAID needed to spend work time resolving the concerns raised by the Applicant's actions. 22.I was aware that Mr Joe Zabar and Mr John Domitrak had contacted the Public Service Commission (before I gave the direction to the Applicant) in order to determine whether the direction which I gave the Applicant was one which was open to me to give. I understood that the advice which they received was to the effect that I could give such a direction to the Applicant. I also had regard to the Workplace Harassment Guidelines which had been published by AusAID and which were based upon the Public Service Commission's draft guidelines on Eliminating Workplace Harassment in the Australian Public Service. I was aware of the AusAID Guidelines as the Guidelines had been revised in the first six months of my occupancy of the Assistant Director-General, Financial and Resource Management Branch position. I took the view that the Applicant's conduct was harassment within the meaning of those Guidelines and within the meaning of the Sex Discrimination Act 1984. 23.On 4 July 1995 I received a telephone call from Ms Bond. She said words to the effect 'Graham called me at approximately 8.00pm last night. I recognised his voice and I told him he was not to contact me. When I asked him why he had called me again he said he had previously only reached the answering machine. He then rabbitted on and I put the phone down'. Later that day Mr John Domitrak, acting Director STAFF in AusAID and I spoke to the Applicant. The Applicant said words to the effect 'I called Penny last night but my previous attempts to call her were some time ago. I like Penny. She is an experienced person who should be able to handle my enquiries of her'. I said to the Applicant words to the effect 'As Ms Bond does not want to be contacted by you your actions constitute harassment. Because you have disobeyed the instruction which I gave you not to harass other officers AusAID has no alternative but to take disciplinary action against you. An officer will be appointed to report on the facts of the incident and to advise me on disciplinary options' ". ... All that need be said of the resultant inquiry which found the applicant guilty of s56(a) misconduct was that the Inquiry Officer, in concluding that disciplinary action was necessary, had regard to -

"- the several previous incidents of this nature involving both Ms Penny Bond and other officers, which have been reported to AusAID management.

• the extent of oral and written counselling and warnings already provided to you for the same type of behaviour at the following times: 8 March 1994 22 August 1994 29 November 1994 2 December 1994 18 January 1994 20 January 1995 4 July 1994 17 July 1994 ...

• your unwillingness to accept any assistance in addressing the behaviour which has disrupted the working and private lives of other AusAID staff."

"- the impact of your behaviour in disrupting the personal and work environment of your fellow AusAID workers on repeated occasions." I mention these matters simply for the factual findings they embody noting again that they have not been challenged in any way. The evidence here, in my view, is quite sufficient to satisfy the conditions which I earlier have said would need to be made out to justify the giving of a direction. (i) Mr McManus' harassment of Ms Bond, as also that of the other two officers mentioned in the evidence, clearly was a consequence of their co-employment in AusAID. (ii)That harassment was believed by Mr Casson to, and was subsequently found to, have had significant adverse effects on workplace relations, the performance of the officers harassed and on the use of management resources. It equally seems clear that proximity of the parties in AusAID was a cause of these effects. As to the actual direction given, while it precludes all contact with Ms Bond "outside the requirements of official duty", it was in my view a reasonable and appropriate response to the state of affairs which Mr Casson believed existed at the time it was given. I find in consequence that it was a direction with which Mr McManus was obliged to comply and this finding must result in the application for an order of review being dismissed. I would, though, add this. At a counselling session held at the time the direction was given, Mr Casson told Mr McManus (according to a file note of 20 January) 1995 that: "This instruction also applied to Mr McManus not approaching two other women officers who had been approached previously by Mr McManus. Notwithstanding that these two officers had left AIDAB, Mr McManus was employed in AIDAB and the instruction that he not approach them still stood." I would merely say that, consistent with the conditions I have held to be necessary to justify the giving of a binding direction, this instruction would seem to fall well short of what is required. The parties were not relevantly co-workers in a situation of workplace proximity at the time of the instruction. In the event, then, I extend the time in which to lodge the application for an order of review. I dismiss the application for an order of review with costs. I certify that this and the preceding 35 pages are a true copy of the Reasons for Judgment herein of the Honourable Justice Finn. Associate Dated: 14 October 1996 Counsel for the applicant : R Thomas Solicitors for the applicant: pappas j - attorney Counsel for the respondent : T Howe Solicitors for the respondent : Australian Government Solicitor Date of hearing : 29, 30 July 1996 Date of judgment : 15 October 1996