Cook v Australian Postal Corporation

The Full Bench's decision 24 The Full Bench noted that the Commissioner had given consideration to the transformed nature of Mr Cook's role as a paid workplace representative. It found that it was open to the Commissioner to conclude that Mr Cook's new role represented a conflict of interest despite Mr Cook's assertions to the contrary, and that Mr Cook's continuing to perform the role in defiance of warnings from his employer would jeopardise his employment and represented serious misconduct. The Full Bench did not consider that the Commissioner's finding that Australia Post would have lost trust and confidence in Mr Cook constituted a significant error of fact. 25 It also found the Commissioner had made reference to the submissions by both parties concerning s 772(1)(d) and (e). It found that those provisions did not fall within Pt 3-2 of the Act: "so while the Commissioner did not directly deal with the submissions the parties made regarding them, we do not consider that it was necessary for him to do so in order to determine the application before him". It concluded that it would refuse leave and said that the Commissioner: [A]ppropriately in our view, took issue with Mr Cook carrying out this function [of being a representative] only after he began receiving payment from those whom he was representing in secondary employment on the basis that it represented a conflict of interest. 26 The Full Bench found that there was no arguable case of appellable error of a nature that would attract the public interest consideration, and accordingly, it refused his application.

The proceeding before the primary judge 27 Australia Post initially sought that Mr Cook's application for judicial review be summarily dismissed. A judge of the Court rejected that application. Her Honour found that there was a "vexed" relationship between ss 378 and 772, so that it was arguable, for the purposes of considering summary dismissal, that the Commission had no power to find that the termination of Mr Cook's employment was unlawful under s 772(1) in the absence of an application under s 773, however, that it was not appropriate to determine such an argument on a summary dismissal basis. Cf: Cook v Australian Postal Corporation [2017] FCA 509 at [75]. 28 The proceedings then came before the primary judge, who considered each of the grounds advanced to challenge the Commissioner's and Full Bench's decisions. His Honour, in seeking to summarise Mr Cook's arguments, noted that he had been troubled by a disturbing fluctuation in the manner in which they sought to rely on s 772, a criticism with which it is difficult not to sympathise. He concluded that none of the errors asserted had been established. His Honour reasoned that neither the Commission nor the Full Bench had been required to consider s 772 or whether Mr Cook's employment had been terminated because he was acting as a representative of employees or had filed a complaint against an employer. 29 We should interpolate that there was no evidence that Mr Cook had filed any complaint against an employer so as to enliven s 772(1)(e), and we were not addressed on it in argument. That provision can be put to one side. His Honour found that there was nothing in the reasons in the letter of 17 December 2015, in which Australia Post dismissed Mr Cook, that called for any consideration to be given to a question about a contravention of s 772(1)(d) or (e). Mr Cook filed his application for unfair dismissal the day after he received the 17 December 2015 letter and it confined the basis for the relief sought to his having been unfairly dismissed for the purposes of Pt 3-2. 30 His Honour found that the criteria for consideration of whether a person had been unfairly dismissed were those in s 387, and that the existence of any reason for termination which might render the termination in contravention of s 772 was not a consideration the Commissioner was bound to take into account. Critically, the primary judge held that, the reasons Mr Cook put in his filed application for relief for unfair dismissal relied on his having acted as a representative of employees under s 772(1)(d). His Honour found that the Commissioner did not need to address that question and that he concluded that Mr Cook's so acting was serious and wilful misconduct. 31 Therefore, his Honour found that there was no basis to attack the discretionary decision of the Full Bench to refuse to exercise its power under s 400 to grant leave. His Honour said that the Commission could not entertain in an application under Pt 3-2, an application in respect of a complaint under s 772 because it was precluded from doing so by the provisions of s 725. That finding has not been an issue in the appeal. 32 His Honour found that it was not a relevant consideration for the Commission to take into account any allegation of the reason for termination of employment being one of those set out in s 772 because s 387 had to be construed by reference to the objects of the Fair Work Act in ss 3 and 381, in respect of Pt 3.2 itself. He found that the Commissioner was only bound to take into account the matters to which Mason J referred to in Minister for Aboriginal Affairs v Peko-Wallsend Ltd (1986) 162 CLR 24 at 39-41, which his Honour set out in his reasons. 33 The primary judge found that the Commissioner's task did not include, when resolving an application under s 387, consideration of whether a reason for the dismissal was one of the reasons prohibiting termination of employment in contravention of s 772, because the Commission had to apply the terms of s 387. His Honour then reasoned: 76 The statutory scheme whereby an employee is faced with an election to either seek a remedy for unfair dismissal pursuant to Pt 3-2 or a remedy to resolve a dispute pursuant to Pt 6-4 (and the inability to pursue both remedies concurrently in contravention of s 725) supports a conclusion that the regime provided for in Pt 3-2 stands separate and apart from that provided for in Pt 6-4. It would considerably undermine the legislative insistence upon an employee making an election if an employee were to be permitted to merge the considerations of relevance to the pursuit of one remedy with the considerations of relevance to the other. 77 Even more broadly expressed, there is no statutory requirement which compels the Commissioner when considering a Pt 3-2 application to give consideration to the circumstances in which an employee may act as "a representative of employees". 78 There is nothing in the terms of s 387 which requires matters of relevance to the pursuit of an application under s 773 to be necessarily taken into account. To employ the language of Mason J in Peko-Wallsend, the Commission when considering an unfair dismissal application is not "bound" to take into account matters of relevance to an application under s 773. Any consideration of matters of relevance to a s 773 application, moreover, may also render more complex, and undermine the informality of, an unfair dismissal application and run contrary to the objects of Pt 3-2 as set forth in s 381. 34 His Honour dismissed the second ground of review. He considered whether, contrary to his conclusion, the Commissioner was not bound to have regard to s 772(1)(d) or (e). His Honour found that, in fact, the Commissioner did have regard to the representative role that Mr Cook had undertaken and that the Commission's reasons made that manifest. He said that the Commissioner found the conduct justifying Mr Cook's dismissal was not his representative activities. Rather, because he had been paid for providing such services, first, the payment created a conflict of interest of such a serious nature that it jeopardised Mr Cook's employment and, secondly, Mr Cook had obtained secondary employment, the purpose of which was directly inimical to the interests of the employer, as the Commissioner had found at pars [55] and [58]. His Honour also found the Commissioner had concluded that the conflict of interest and receipt of payment was sufficient, in itself, to justify Mr Cook's dismissal. 35 His Honour rejected the challenge to the Commissioner's exercise of his discretion not to reinstate Mr Cook, noting that he had given consideration to that question and concluded against it. The primary judge found that, given the application that was before the Commissioner was one for unfair dismissal, the Full Bench had been correct in concluding that it had not been necessary for the Commissioner to deal with the submissions relating to s 772(1)(d) and (e) and that the Full Bench's discretionary refusal to grant leave to appeal fell within the scope of a sound exercise of discretion under the principles in House v The King (1936) 55 CLR 499 at 504-505. 36 His Honour also rejected the Constitutional arguments that Mr Cook had advanced. He held, first, that there was no constitutionally protected freestanding right of association as Hayne J had said in Tajjour v State of New South Wales (2014) 254 CLR 508 at 566-567 [95]. That finding was not challenged on the appeal. Secondly, his Honour found that Pt 3-2 of the Fair Work Act had no impact on any freedom of association implied by the Constitution as a corollary of the implied freedom of political communication because, as the Commissioner had found, Mr Cook was still free to act as a representative of employees. His Honour said (at [98]): "[t]hat which characterised his conduct as "serious misconduct" was his placing himself in a position of conflict" (emphasis in original). 37 Finally, his Honour said that the ordinary practice is not to decide constitutional questions unless there exists a state of facts which makes it necessary to decide such a question in order to do justice in a given case and to determine the rights of the parties, citing what Dixon CJ had said in Lambert v Weichelt (1954) 28 ALR 282 at 283. 38 For those reasons, his Honour dismissed the proceedings.

The appellant's submissions 39 The appellant argued that the primary judge erred in construing s 387 as excluding any consideration of s 772. He argued that, as the Commissioner recorded in the part of his reasons dealing with the submissions of the parties, Mr Cook had made a clearly articulated argument or claim that his dismissal contravened s 772(1)(d) or (e) and that nowhere in the reasoning section of the Commissioner's decision did he address that argument. He contended that the Full Bench had erred in its conclusion that the Commissioner did not need to deal with that argument and that the primary judge, likewise, had erred in finding no error in the Full Bench's and the Commissioner's decisions as to the failure of the Commissioner to deal with that argument. Mr Cook argued that the primary judge had failed to read the Act as a whole and had not applied proper principles of construction to the conclusion that he reached. He contended that it had not been necessary for him to make any separate application under Pt 6-4 for the Commissioner to have had the obligation to consider his claim that a reason for his dismissal had been one of the prohibited reasons in s 772(1)(d) or (e). He contended that there was nothing in the wording of s 772(1)(d) to distinguish between the voluntary activities that he had undertaken prior to commencing his enterprise with ELISA and subsequently, namely, he submitted it was irrelevant whether he received payment or voluntarily acted as a representative of other employees. 40 Mr Cook also contended that the Constitutional point arose because, if his Honour's reasoning were correct, the structure of the Act had somehow immunised the Commission, in an application for unfair dismissal under s 387, from being able to have regard to whether the activity complained of was protected by what was said to be the implied Constitutional freedom of association as a corollary of the implied Constitutional freedom of communication on government and political matters. He argued that the primary judge had found that Australia Post had been entitled to dismiss him because he had exercised his representative rights and that he had no remedy for doing so. He contended that communication by one employee to the employer concerning the rights of another employee under the Fair Work Act was within the implied Constitutional freedom of communication and that, to the extent that the primary judge's construction of the Act were otherwise correct, it impermissibly burdened that freedom of communication, being the right to complain in support of an assertion of a workplace right. He contended that the source of the burden was somehow to be found in s 725 and he also argued that the purpose of the legislation, on the primary judge's construction, was to restrict workers' rights to avail themselves of their freedom of association in unfair dismissal cases and that this was not compatible with the Constitutional scheme.

Consideration 41 This is an appeal from the primary judge's decision to refuse judicial review remedies to Mr Cook on the basis that his Honour found no occasion to grant Constitutional writs to the Commission or Full Bench. On the principles applicable to the present case, the appellant must demonstrate error on the part of the primary judge. It is also important to have regard to the fact that it is well settled that, in the context of administrative decision making, the Court is not astute to discern error in a statement by an administrative officer (including the Commission or the Full Bench, which is part of the executive arm of the Commonwealth under Ch II of the Constitution) which was not, and was not intended to be, a statement of reasons for a decision that is a broad administrative evaluation rather than a judicial decision: Plaintiff M64/2015 v Minister for Immigration and Border Protection (2015) 258 CLR 173 at 185 per French CJ, Bell, Keane and Gordon JJ. 42 The primary judge concluded that the Commissioner was not bound to take into account s 772(1)(d) or (e) in the circumstances. Of course, in considering whether there was a valid reason for Mr Cook's dismissal within the meaning of s 387(a), a dismissal that contravened s 772(1)(d) or (e) would not be one that occurred for a valid reason. 43 As we understand his Honour's reasons, the primary judge proceeded on the basis that, having regard to the reasons which the Commissioner gave, those reasons demonstrated that he made no finding that the, or a, reason for Mr Cook's termination was that he had acted in the capacity of a representative of employees or otherwise participated in proceedings against Australia Post involving any alleged violation of law or regulations or recourse to competent administrative authorities, such as appearing in the Commission. If it had been found that the reason or a reason for Mr Cook's termination involved either s 772(1)(d) or (e), then the decision to terminate him may not have been valid, but that was not this case. 44 The Commissioner carefully considered the circumstances. True it is that in his reasoning process he did not return again to either s 772(1)(d) or (e). But, in substance, the Commissioner dealt with the subject matter in very careful reasoning that identified that the reason for his dismissal had nothing to do with Mr Cook's representation of employees, participation in proceedings against Australia Post or acting as a representative. Rather, as the Commissioner had set out earlier in his reasons, at [8], Mr Cook had engaged in an admirable role of a workplace representative, when acting voluntarily. The vice which the Commissioner found was not that suggested at all. The reason on which the Commissioner acted was, as he said in [57]-[58], that Mr Cook "had obtained secondary employment, the purpose of which was directly inimicable to the interests of the employer" and that his new role working with ELISA had "altered significantly and dramatically, with the establishment of a payment for service arrangement". The Commissioner found that these factors created a conflict of interest that was, in effect, both untenable and manifest. 45 There was no challenge to the Commissioner's finding, before the primary judge or on appeal, that Mr Cook had engaged in and obtained secondary employment, the purpose of which was directly inimicable to the interests of Australia Post. Moreover, the Commissioner found that allegation 7 involved Mr Cook conducting a paid employee representative role in blatant defiance of warnings that his employer had provided and that this represented serious and wilful misconduct. The Commissioner was entitled to make those findings. In Blyth Chemicals Limited v Bushnell (1933) 49 CLR 66 at 81-82, Dixon and McTiernan JJ said (and see too: per Starke and Evatt JJ at 74 and Commonwealth Bank of Australia v Barker (2014) 253 CLR 169 at 190 [30], per French CJ, Bell and Keane JJ and 202 [65], per Kiefel J): Conduct which in respect of important matters is incompatible with the fulfilment of an employee's duty, or involves an opposition, or conflict between his interest and his duty to his employer, or impedes the faithful performance of his obligations, or is destructive of the necessary confidence between employer and employee, is a ground of dismissal (Boston Deep Sea Fishing and Ice Co. v. Ansell [(1888) 39 Ch. D. 339 at 357-8 and 362-4]; English and Australian Copper Co. v. Johnson [(1911) 13 C.L.R. 490]; Shepherd v. Felt and Textiles of Australia Ltd. [(1931) 45 C.L.R. 359]). But the conduct of the employee must itself involve the incompatibility, conflict, or impediment, or be destructive of confidence. An actual repugnance between his acts and his relationship must be found. It is not enough that ground for uneasiness as to its future conduct arises. 46 Thus, it can be seen that the Commissioner's decision was a decision about the breakdown of trust and confidence between Mr Cook and Australia Post and was not to do with either of the reasons in s 772(1)(d) or (e). Moreover, s 772(1) must be read as a whole. Although s 772(1)(b) identifies that a reason for dismissal cannot include trade union membership or participation in trade union activities outside working hours or, with the employer's consent, during working hours, it could hardly be said that a person who engaged in paid secondary employment, while a full-time employee of an employer, would be simply acting as a representative of employees by fulfilling his paid engagements to represent those employees during working hours. 47 The Act cannot be construed as meaning that any association between a person having a representative role and his employment would preclude termination. The absurdity of the argument can be seen in asking where or whether Australia Post could ever have drawn the line to prevent Mr Cook, during ordinary working hours, performing representative activities, for which he was being paid in his secondary employment. If his argument about the reach of s 772(1)(d) were correct, any attempt to curtail those activities would place the employer in a position of having to pay an employee, as a full-time worker, while that person could, at the same time during his working hours, act as a full-time paid advocate against the employer's interests and contrary to its instructions. Section 772(1)(d) and (e) require the motivation for the determination to have been the mere fact that the person was acting or had acted in the capacity of a representative of employees, as opposed to the situation here, which the Commissioner found in accordance with ordinary and longstanding principles in employment law to have been a breach of Mr Cook's duties as employee. 48 The principles of statutory construction require the court to have regard to the text of the legislation and its context and purpose, particularly where the text is ambiguous. In the circumstances here, the Commissioner made a factual finding that did not leave any scope to argue that a reason for Australia Post terminating Mr Cook's employment was to be found in either s 772(1)(d) or (e). For that reason, the Commissioner was not required, in the course of giving an administrative decision, to traverse that ground. His findings, at [56]-[61] and [71]-[75], was that no part of the reason for termination of Mr Cook's employment involved either of the prohibited reasons in s 772(1)(d) or (e) and, therefore, that section could not have been operative in undermining the validity of Australia Post's decision to terminate Mr Cook's employment. 49 The conflict of interest that the Commissioner found, namely that Mr Cook had engaged in secondary employment while a full-time employee, did not amount to a proscribed reason under s 772(1)(d) or (e), or otherwise affect the validity of the decision to dismiss him. 50 In those circumstances, it is neither necessary nor desirable to address Mr Cook's convoluted Constitutional argument which does not arise on the facts and may not arise on the law: see also Adams v Director of the Fair Work Building Industry Inspectorate (2017) 351 ALR 379 at 401-408 [66]-[89], where North, Dowsett and Rares JJ discussed an analogous Constitutional argument and rejected it. 51 We agree with the primary judge that it is not necessary to decide Constitutional questions unless there is a state of facts which makes it necessary to decide such a question in order to do justice in the given case and determine the rights of the parties: Duncan v New South Wales (2015) 255 CLR 388 at 410 [52] per French CJ, Hayne, Kiefel, Bell, Gageler, Keane and Nettle JJ. 52 For these reasons, the appeal must be dismissed.

Australia Post's application for an order for costs 53 Australia Post has applied for an order for costs of the appeal pursuant to s 570(2)(b) of the Fair Work Act. That provides that a party may be ordered to pay costs only if the Court is satisfied that the party's unreasonable act or omission caused the other party to incur the costs. Otherwise the provisions of s 570(1) apply, so that there be no order for costs in proceedings under the Act. 54 Australia Post argued that there were two reasons why the power to order Mr Cook to pay its costs of the appeal should be exercised, namely, first, that the appeal was incompetent or hopeless and secondly, because on 26 July 2018, Australia Post had made an offer of compromise under Pt 25 of the Federal Court Rules 2011 and had written a letter on the same day making a Calderbank offer in the same terms (see Calderbank v Calderbank [1976] Fam 93). 55 Australia Post argued that the case was hopeless because it repeated the contentions that the primary judge had rejected and had a fatal flaw, namely Mr Cook's approach to relying on the provisions of Pt 6-4 as a basis for challenging the reasoning of the primary judge and the validity of the decisions of the Commissioner and the Full Bench. 56 The letter accompanying its offer of compromise asserted that Australia Post had incurred significant costs but did not itself articulate or identify exactly how the very large sum asserted had been arrived at, or allow any examination of the reasoning process for that. 57 While Mr Cook has been unsuccessful in his appeal, we are not persuaded that his case was unhelpful or foredoomed to fail (see Walton v Gardiner (1993) 177 CLR 378 at 392). The principal question for decision was a matter of statutory construction as to what, if any, role s 772(1) might play in proceedings under Pt 3-2 of the Act. While we have rejected Mr Cook's argument, we are not persuaded that it was hopeless or would otherwise be able to be characterised as unreasonable. Although the same could not be said of the Constitutional point, it played a minor role in the appeal. Moreover, it would not be right in proceedings under the Fair Work Act to hold that a failure to accept an offer of compromise amounted to itself an unreasonable act warranting a departure from the statutory principle that the Court should not order one party to pay the other's costs in proceedings under the Act. There is nothing in the circumstances of this case that suggests that the mere service of an offer of compromise or the making of an offer to compromise in accordance with principles in Calderbank [1976] Fam 93 elevate the failure to accept either offer to being characterised as unreasonable or as sufficient to displace the statutory general rule. 58 For these reasons, Australia Post's application for an order for costs should be refused. I certify that the preceding fifty-eight (58) numbered paragraphs are a true copy of the Reasons for Judgment herein of the Honourable Justices Rares, Perry and Charlesworth.