Hogan v Employment National

Ansett Transport Industries (Operations) Pty Ltd v Wardley (1978-1979) 142 CLR 237 Australian Broadcasting Commission v Industrial Court (SA) and anor (1976-1977) 138 CLR at 399 ACTEW Corporation Ltd v Pangallo [2002] FCA 325, per Whitlam and Gyles JJ Beahan v Bush Boake Allen Australia Ltd (1999) 47 NSWLR 648 - 692 Barry v Australian Broadcasting Corporation (2002) 112 IR 33 Burgess and ors v Mount Thorley Operations Pty Ltd [2002) NSWIRComm 106 BHP Iron Ore Pty Ltd v The AWU (2000) 102 FCR 97 BNY Australia Ltd v James (1992) 26 NSWLR 57 Davies v General Transport Development Pty Ltd (1967) AR 371 at 373 - 374 Hudson v Qantas Airways Ltd (1985) 10 IR 331 CASES CITED : ICI Australia Operations Pty Ltd (t/as Dulux Australia) v Hutton (1993) 47 IR 288 Incitec Ltd and anor v Industrial Court of New South Wales (1992) 45 IR 155 Huskisson RSL Sub-Branch Ltd v Sullivan (1990) 20 NSWLR 332 McGowan v Australian Broadcasting Corporation (2001) 104 IR 244 Moore v Newcastle City Council, re Civic Theatre, Newcastle (1997) 77 IR 210 Riverwood International Australia Pty Ltd v McCormick (2000) 177 ALR 193 Scott v Picone and ors [2002] NSWIRComm 239 State of New South Wales v Health and Research Employees' Association of New South Wales (unreported, Fisher CJ, Bauer and Hill JJ, 31 March 1993) Thornthwaite v Australian National Credit Union Ltd [2002] NSWIRComm 240 Walker v The Industrial Court of New South Wales (1994) 53 AR 121 Westfield Holdings v Adams (2001) 114 IR 241 HEARING DATES: 04/15/2002; 04/16/2002; 04/17/2002; 04/18/2002; 04/19/2002; 08/27/2002; 09/05/2002; 10/17/2002 DATE OF JUDGMENT: 11/27/2002

APPLICANT: Mr D Marr of counsel SOLICITOR: Mr D Roberts LEGAL REPRESENTATIVES: RESPONDENT: Mr J Phillips of counsel SOLICITOR: Mr M Tooma Deacons

JUDGMENT: - 1 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES IN COURT SESSION

Matter No. IRC 5854 of 1999 Michael John Hogan v Employment National (Administration) Pty Ltd. Application under s 106 of the Industrial Relations Act 1996 JUDGMENT [2002] NSWIRComm 313

1 The applicant commenced employment with the respondent on 17 May 1999 under an arrangement whereby there was to be an initial probationary period of three months. In the last few days of that probationary period the respondent terminated the employment of the applicant in circumstances that the applicant alleges attracts the jurisdiction and remedies available under s 106 of the Act.

2 The amended Summons for Relief contains a commendably brief narrative of the circumstances and grounds relied on in support by the applicant: unfortunately, this approach did not extend to the hearing of the application. The applicant claimed that he carried out his duties on behalf of the respondent in a responsible and diligent manner but, in the course of performing his duty, became aware that staff at the office in which he worked were falsely claiming fees on the basis that they had placed job seekers with employers when in fact the job seekers had found their own employment (referred to as "FOE"). He alleges that pressure was applied to him by the respondent through other employees to engage in similar conduct. The applicant said that he reported this practice to the Business Centre Manager of the respondent at Windsor and the respondent's Regional Manager during a meeting held on 11 August 1999. The applicant said that his employment with the respondent was terminated that afternoon.

3 It is said that the contract or arrangement under which the applicant performed work was unfair in that: (i) the applicant was required to engage in dishonest and/or fraudulent practices in order to maintain his position with the respondent; (ii) the respondent was permitted to terminate the applicant's employment without any sufficient cause; (iii) the applicant was discriminated against to his detriment; (iv) the respondent was invested with significant discretionary powers which were exercised to the substantial detriment of the applicant; (v) the respondent was permitted to deprive the applicant of the benefit of long term secure career employment; (vi) the applicant was at all times in a position of unequal and inferior bargaining power in dealings with the respondent. The applicant claimed a loss of $691 per week from 13 August 1999 and continuing; compensation for anguish, grief, pain and suffering occasioned to the applicant; general damages; and interest.

EVIDENCE FOR THE APPLICANT 4 The applicant's evidence was that he was 46 years old, married with two young children. He had completed his higher school certificate in 1973, had attended New England University and had obtained a degree in Economics in 1976. He gave his work history as being appointed as an Education Officer with the Department of Education between 1977 and March 1978; appointment as an employment and youth officer with the Department of Employment and Industrial Relations between May 1978 and November 1982; working as the manager, sales support for Telecom Australia between September 1984 and March 1992; a period of self employment as a milk vendor from April 1992 to February 1997; further self employment as an owner/driver between March 1997 and December 1998; and then employment between May 1999 and August 1999 as a client service consultant with Employment National. The applicant said that, after termination of his employment with the respondent, it was not until March 2000 that he then obtained further employment as an asset administrator.

5 The applicant said that he had initially applied for employment with the respondent in December 1998 but had failed in that application. He was then contacted in May 1999 in relation to employment with the respondent and agreed to take up employment as a Client Service Consultant. Mr Hogan was provided with a detailed written offer of appointment by way of letter dated 11 May 1999. A detailed job description covering the position was attached to the letter and he was told that his position was currently located within the Windsor Business Centre. An initial salary for the position was set at $35,894 per annum. The letter of offer then contained the following: It is a condition of this offer of ongoing employment that you and the company enter into two agreements: firstly, an Employment Relationship Agreement which is an Australian Workplace Agreement (AWA) made under the provisions of the Workplace Relations Act 1996 and secondly, an agreement to terminate that AWA when a Certified Agreement is made and certified by the Australian Industrial Relations Commission. Copies of both Agreements are included in the information kit that accompanies this letter. The letter said that enclosed with the offer was a further letter from the respondent which explained the effect of the proposed AWA. He was told to read and consider the second letter after the AWA package and prior to signing the AWA. If he had any questions relating to the proposed AWA, the letter explaining its effect, the information kit or any other relevant letter, he was told to contact the General Manager of Human Resources Strategy and given a phone number and an email address as a contact point. He was invited, if he wished, to appoint a bargaining agent in relation to the making of the proposed AWA. He was also advised that if he decided to sign the AWA he should do so and date it in the space provided and that his signature should be witnessed. The letter then continued: As has already been explained, the AWA is accompanied by an Agreement that allows the termination of the AWA in certain circumstances. It is a condition of your employment that you enter into this Agreement. The Agreement allowing for termination of the AWA is designed to bring an end to the AWA so as to permit effect to be given to a collective certified agreement between Employment National (Administration) Pty Ltd and its operational and support staff when such an agreement is made. In addition to the AWA, the company has a Personnel Policy Procedures Manual which sets down other matters relating to the regulation of your employment with the Company. A copy of the manual is included in the Information Kit. You will be required to comply with the policies and procedures contained in this Manual. One of the important matters referred to in the Manual relates to a probationary period of employment. You will be on probation for the first three months of your employment and during this period your technical ability to do the job, your ability to work effectively in a team and your performance generally will be monitored and assessed. Your manager will outline any specific requirements relating to this condition of employment. You can be dismissed for any reason during this period by the Company giving you one week's notice or one week's pay in lieu of notice. Your employment with the Company as a Client Service Consultant will be full-time and ongoing. It can be terminated by you or the Company giving a minimum of one month's notice. If the Company is required by legislation to give more than the notice specified above, additional notice will be given by it or it will make payment to you of a corresponding amount of salary in lieu of the additional notice. Should your employment be terminated for any reason other than serious misconduct, the Company's redundancy arrangements, if applicable, will apply … . At the bottom on this letter of offer there was a space for Mr Hogan to accept the offer and the conditions outlined in it, which he did on 12 May 1999.

6 The offer had as an attachment, as indicated, the Employment Relationship Agreement (AWA). The AWA ran to 43 pages including a Schedule with particulars of the applicant's name, position and proposed salary. The AWA contained 28 clauses and schedules dealing with parental leave, long service leave, redundancy and particulars. The forty-fourth page contained the signatures of the employee and an officer on behalf of the respondent. Clause 5 of the AWA, entitled "Policies and Procedures" contained the following provision: Company policies and procedures for the Agreement This Agreement is supported by policies and procedures determined by the Company from time to time. These policies and procedures will not reduce your substantive entitlements as set out in this Agreement, but provide guidelines for the fair and efficient administration of the employment relationship. You and the Company must comply with these policies and procedures.

Clause 7.5 permitted, with the agreement of the office manager, working the 147 ordinary hours in a cycle of four consecutive weeks so that time off could be arranged and made up by working at an earlier or later time or times within the daily nine ordinary hour span. Clause 9.1 allowed a meal break of at least 30 minutes and not more than one hour unless otherwise agreed: normally the meal break would start between 11.30 am and 2.30 pm. In case of emergency or to meet unusual business needs, the manager could require a consultant to take meal breaks otherwise than in accordance with the provisions of the clause. Clause 2.1 provided that subject to the redundancy provisions of Clause 25 "… your employment will be ongoing". The AWA then set out salary bands for different classes of personnel, indicating that it was an agreement used across all employment categories in the respondent. Clause 24 dealt with "termination of employment" by making the following provision: How can your employment be terminated? 24.1 Your employment may be terminated by either you or the Company giving one months notice (or longer where required by the Act) in writing or payment or forfeiture (as the case may be) of pay in lieu of such notice. Your rights on termination 24.2 You have your full rights under the Act if the termination is harsh, unjust or unreasonable or if your employment is unlawfully terminated. Serious Misconduct 24.3 The Company, however, may dismiss you without notice at any time for serious misconduct. In such circumstances the Company is liable to pay you only up to the time of your dismissal.

7 Clause 26 of the AWA provided for a detailed dispute resolution procedure. The clause was to apply to any dispute arising about a matter covered by the Agreement or in relation to "… any other matter relevant to your employment …". It required the employee to attempt to resolve the matter at the workplace level by the employee and the employer's manager meeting and conferring and, if not resolved in such a meeting by the employee and the manager, arranging further discussions involving more senior levels of management. It allowed the appointment of another person to act as agent in relation to resolving the matter at the workplace and permitted the matter to be referred to a mediator if it could not be resolved at the workplace. The clause required the parties to agree that mediation would occur in good faith and further stated that, during the time when the procedure was being followed, the employee and the company would continue to work in accordance with the contract of employment unless the employee had a reasonable concern about an imminent risk to his or her health and safety. In the absence of being able to resolve the matter by mediation and where there is dispute over the application or interpretation of the Agreement, the dispute could be referred to the Australian Industrial Relations Commission, which would appoint an independent arbitrator to settle the dispute by arbitration.

8 The early part of Mr Hogan's employment appears to have been uneventful. During this period, he was given training by Mr Steve Williams, who was the Centre manager, although his day to day supervisor was Ms Jenny Delf. There was one other consultant in the office, Mr Hampton, who was an Employment Consultant at the same level at Mr Hogan, having been appointed during December 1998. The only other employee in the office was a receptionist, Ms Edwards.

9 On 21 July1999, the applicant received a performance review signed by Mr Williams assessing the applicant as fully meeting the requirements of the position. This report, which was in evidence, assessed the applicant at a level of performance which fully met the requirements of the position on numerous categories of assessment. The rating of "fully meets the requirements" was the second highest rating, only surpassed by the highest rating described as "exceeds job requirements". The performance review document had a covering "with compliments" slip in the handwriting of Mr Williams which stated: Mick, thank you for your efforts. I think we are all working in well. Regards, Steve Williams.

10 The applicant said that on about 14 June 1999, Jenny Delf, who was the senior employment consultant at the Windsor office, instructed him on how to enter data on the computer system concerning a job seeker who had found her own employment. He said this involved creating a job vacancy on the system and referring the job candidate and placing her with the employer. He followed this instruction and made entries as Jenny Delf directed. Taking this action resulted "… in a placement statistic and a job matching fee at the Windsor office of Employment National". The fee was said to be $180 for each such person who was said to have been found employment, with a $100 bonus, payable to the respondent.

11 Around 26 July 1999, the applicant contacted a person who had been in long term unemployment but found that that person had already found her own employment. The applicant then informed Steve Williams that he intended to make entries on the computer as Ms Delf had instructed him whereby, ultimately, a claim would be made by the respondent for successfully placing that person. The applicant said that Mr Williams told him that that was not the correct procedure and that the respondent was not entitled to a job matching placement or statistic and the associated fees if the candidate had found their own employment. Mr Williams then showed the applicant the correct procedure to record the fact that employment had been found by the person themselves. This procedure did not involve raising a claim for the placement fee or bonus.

12 At about the same time as Steve Williams had shown the applicant the appropriate procedure for recording persons who had found their own employment without making a claim for a placement fee and bonus, the applicant had a conversation with Jenny Delf in which he said that Steve Williams had shown him the correct procedure for recording candidates who had found their own employment and it was different to the way in which Jenny Delf had instructed him. He told her that the respondent was not entitled to a placement fee or placement statistics if the candidate found his or her own employment. He told Jenny Delf that in future he would be recording all his candidates in the correct way as shown to him by Steve Williams. Jenny Delf is said to have replied that she made the entries in that way because it needed to be done so that the respondent could keep up its placement statistics and its income. She pointed out that the applicant was not "on an individual placement target", whereas she and Tony Hampton were on placement targets and in order to achieve their targets these placements were needed. According to the applicant, she told him that if he wanted to do it the way Mr Williams had told him he could go ahead and do it that way.

13 During this conversation, a heated discussion took place where the applicant claims that Jenny Delf swore at him, described him as walking around the office "high and mighty", having no right to act in the way he did and in accusing him of "… alienating me from other people in the office". The applicant then says he asked Tony Hampton if what Jenny Delf had said was correct to which Mr Hampton is said to have replied "We're all members of a small team. We have to work together". Apparently, the applicant saw this response as supporting what had been said by Jenny Delf and he admits to losing his temper and swearing at Mr Hampton and declaring that he would not make these entries in the way the others wanted him to. Mr Hampton left the office and Jenny Delf told the applicant that all offices of the respondent recorded these entries the way she and Mr Hampton did and that it was a widespread practice across Employment National offices. The applicant said that he replied, "Well, morally and professionally, I can't do it." According to the applicant, during this conversation Jenny Delf said: You're still on probation and I intend to tell Steve that your employment should be terminated.

14 The applicant said he objected to the practice adopted by Jenny Delf and Tony Hampton. It was not in accordance with the Manual and the information guide for network members. It was not the way he had been shown by Steve Williams.

15 The next day, about 28 or 29 July 1999, the applicant approached Jenny Delf and sought a private conversation in order to sort out their differences. He recalls telling her that in the circumstances he did not think it was practicable for him to stay on with Employment National in the long term and that he had spoken to his wife about what had happened the day before. He informed Jenny Delf that he intended to ask Steve Williams for an "honest and fair reference and start looking for other employment". He told her that "Morally and professionally I cannot do what you and Tony are doing". The applicant recalls that Jenny Delf replied that she had no complaint about the applicant's work but "… we need to process the claims this way to keep the office open and meet our targets". The applicant also recalls that Jenny Delf said that Steve Williams would become suspicious if asked for a reference because he would investigate why the applicant wanted to leave - but if that was what the applicant wanted to do then "so be it". The applicant told her that he would let things settle down for a couple of weeks before he approached Steve Williams.

16 The applicant said that during the next few weeks the atmosphere in the office was "very tense". He perceived Tony Hampton and Jenny Delf being clearly very unhappy and abrupt with him. On 6 August 1999, he asked to have a private conversation with Steve Williams and, when asked why he wanted a private conversation, the applicant told Mr Williams that he intended to look for other employment and he wanted Mr Williams to give him a reference. Steve Williams told him that he had picked up "the vibes" in the office that there was a problem but thought it was too late to talk about it that night and proposed that they have a conversation early the following week.

17 According to the applicant, on Tuesday 10 August 1999, (but probably 6 August 1999), Steve Williams invited him out for a coffee so that they could have a private conversation. In this conversation, the applicant told Williams that he was having problems in the office, was feeling alienated and wanted to leave. He asked Williams to give him a fair and honest reference and to support it orally if requested. Williams asked what were the problems and the applicant told him that he did not feel comfortable, that people in the office were using different approaches to the same work, there were personality clashes and so he felt it was better if he left the job. Williams told the applicant that he had a recent meeting with Jenny Delf and that her version of the story was different to his and that he would need to discuss it further. When the applicant asked what were the differences Mr Williams said he would need to speak further with to Jenny Delf and then to speak to the applicant again. During this conversation, Steve Williams raised the fact that the applicant had taken a flexi day the previous Tuesday, which left only Mr Hampton and Mr Williams in the office. The applicant explained that he had booked that flexi day a month in advance in order to attend his son's sports carnival and in any event, on the previous Monday there was only Tony Hampton and himself in the office to perform the work and it had operated smoothly. Further, the applicant said that he had spoken to Mr Williams on the phone on the Monday and he had confirmed that he would be attending the office on the Tuesday. The applicant recalls no further conversation and they both returned to the office.

18 On Wednesday, 11 August 1999, Bob Hall, the respondent's Regional Manager, and Steve Williams had a meeting with the applicant. This meeting had not been arranged and was unexpected by the applicant. The applicant recalls the conversation to be to the following effect: BOB HALL: We've spent enough money on you on training, why should we spend any more when you want to leave the organisation. Why shouldn't we piss you off right now? Tell us what the problem is?'' HOGAN: There are problems in the office between staff. I have no problem working here in the short term but I think I would be better off leaving. All I want from you is a true reference and an undertaking that you will back it up orally if necessary. HALL: Tell us what the problem is or you're fucking gone. HOGAN: If you put me off I'll go to the Minister with what is occurring in the office. They are fraudulently claiming placement fees for people who have found their own work. You know what happens to whistleblowers, I don't want to be a martyr. HALL: Don't worry Mick, if you're telling the truth there will only be you and Steve left working in the office. According to the applicant, during this conversation he explained how Ms Delf and Mr Hampton were wrongly claiming placement fees to achieve targets. The group then returned to the office and the applicant logged on to the computer system and printed out examples of wrongful claims of which he was aware. He said he then went home early as he was suffering from a severe bout of flu and was also stressed.

19 At about 4.45 pm on Wednesday 11 August 1999, Steve Williams telephoned him and said: Don't bother returning to work. You'll be finishing close of business Friday. You're not considered to be a team player. The applicant said that he felt humiliated and extremely let down at this point. On the next day, 12 August 1999, he forwarded a letter of complaint to the Minister for Workplace Relations and others.

20 The applicant then applied for a number of jobs but failed to obtain employment. He stated this was a result of being terminated by the respondent. The applicant produced a letter from the Australian Taxation Office indicating that an offer of employment had been withdrawn. The offer of employment was deferred in April 2000 because of a need to verify his past performance with referees and the ATO had been advised that, because of his dismissal from his previous employer and the inability of the ATO to obtain valid referee comments due to his pending law suit against his former employer, the offer was "withdrawn".

21 On 20 March 2000, the applicant accepted an offer of employment. He stated that he was employed on a casual basis and commenced on a salary of $750 gross per week but that in August 2001 his salary was increased to $900 gross per week.

22 The applicant received a reply from the Minister for Employment Services dated 4 December 2000 which gave details of the investigation of the allegations that had been made by him in a letter forwarded to the Minister and others immediately after his dismissal. In part, that letter stated: The Department investigates all allegations of fraud received and, in addition, any potentially fraudulent matters arising from the Department's assurance reviews and routine contract management of service providers. Investigations are undertaken by accredited departmental investigators. Investigations are subject to periodic quality assurance review by the AFP. The investigation that followed receipt of Mr Hogan's allegations initially disclosed, after an examination of every Job Matching claim from the Windsor Office and after contact with job seekers and employers to check the validity of suspect claims, that 37 claims for job management fees had been made but were not payable. The consequent overpayment of $5,364 has been recovered from EN. In relation to those claims that were not payable, the investigation was directed to ascertain whether there was any evidence sufficient to establish the commission of any offence (for example, false pretences under Section 29A of the Crimes Act, imposition under Section 29B of the Act, or fraud under Section 29D of the Act) by any of the EN staff accused by Mr Hogan. Accredited departmental investigators interviewed, formally, Mr Hogan, the EN staff accused by Mr Hogan and other individuals who it was considered may have had relevant information … The records of the interviews, and other information gathered during the investigation, were presented to the Director of Public Prosecutions (DPP) for advice. The advice received from the DPP, after their consideration of the information provided, confirmed the view of the Department, that there was no evidence sufficient to establish the commission of any other offences under consideration. In summary, no fraudulent intent could be established on the part of any of those accused by Mr Hogan, and each denied any such intent, and each proffered an innocent explanation for the making of the claims - for example, an explanation that their intention was not to claim Job Matching payments that were not payable but rather to record an employment outcome that 'does create the opportunity for the job network member to claim 13 and 26 week outcomes against EN. (as Mr Hogan deduced in his letter of 12 August 1999). It was on this basis - that no fraudulent intent could be established - the decision not to proceed further with the investigation was made. The Australian Federal Police (AFP) was not directly involved in the investigation, although the Department conducted its own review. In the course of this investigation its findings were discussed with the Client Services Team of the AFP. The comments provided by the AFP were taken into account in the Department's decision not to proceed further with the investigation.

23 In cross-examination, Mr Hogan stated that, after Mr Williams had shown him the procedure for dealing with those who had found their own employment (FOE), he had told Ms Delf that not only had Mr Williams shown him the correct way to process such applications but he had checked the process with the Employment National Quick Reference Guides and also its Member's Information Guide. The Guide was the standard guide for job service providers and thereby he had satisfied himself that the process demonstrated to him by Mr Williams was correct. Mr Hogan confirmed that when he informed Ms Delf that this was the approach he proposed to take to FOE she told him that she and Mr Hampton would claim a placement fee for those people because they needed to keep up the revenue of the office. These exchanges with Ms Delf he found to be stressful to the point where he discussed with his wife how he could continue in the office and make claims which he felt were morally and professionally wrong.

24 Mr Hogan said it was not until the conciliation of this application in the Court in 2001 that he was aware that there were allegations against him of sexual harassment. He said that nothing of that nature had ever been raised with him by anyone at Employment National whilst he was employed there: neither had Ms Delf raised these matters with him.

25 In relation to the meeting with Mr Williams and Mr Hall, Mr Hogan said that when Mr Hall said to him "Give me one good reason as to why we should not piss you off right now", he realised that he was "basically gone" if he did not raise the issue of why there was so much conflict within the office, namely the pressure to make unjustified placement fee claims for FOE. When he told them of that reason, they asked him to return to the office and provide evidence of the allegations: at the office, he went through the computer system and provided them with a number of candidates where such placement fees had been claimed. He went home quite stressed after that meeting and at about 4.45 pm he received a telephone call from Mr Williams, who told him that his employment would cease as of Friday, 13 August 1999. Mr Williams told him that he was "not a team player" and that was the reason for his dismissal. He later received a letter of termination, dated 13 August 1999. That letter advised him of his termination "under the probationary provisions outlined in the company's 'Personnel Policy Procedures Manual'". The letter said that the decision had been taken after discussion with the regional manager, Mr Hall, "regarding your overall performance in the position". The letter said it was considered that his performance to date "has not met the competencies and expectations of the position, in particular your ability to work effectively in a small team/office environment". The letter continued: The matter that you subsequently raised in the meeting on Wednesday with Bob Hall and myself concerning procedures in the office are serious and have been referred to senior management for investigation. I thank you for bringing this to our attention.

26 When asked why he had not raised the issue of the improper claims for FOE with Mr Williams earlier than this meeting, Mr Hogan said that he did not particularly wish to become a "whistleblower" and that he knew that whistleblowers usually "would take the fall" and that there would be a "monstrous explosion within Employment National". He felt that there was "severe pressure" within the office about this issue after he had raised it with Ms Delf and Mr Hampton.

27 In cross-examination, Mr Hogan accepted that he did not make any complaint about the offer of employment contained in the letter dated 11 May 1999. Although there was discussion with Mr Williams about the salary available under the AWA that was offered, there had been no negotiations about its terms. He accepted that he had not appointed a bargaining agent although he was invited to do so and that he simply signed the agreement and had it witnessed.

28 Mr Hogan accepted that, in an interview with Mr Williams at the beginning of his employment, he had been told that his employment was subject to a three month probation period which could be terminated for any reason. Mr Hogan also accepted as a fact that his employment had been terminated within three months of its commencement.

29 Mr Hogan also accepted that working in a small office required working as a team and getting on with people. Mr Williams had been his nominated trainer who did a lot of the in house training with him. He said that he went to Ms Delf for a number of issues but often went to Mr Williams for advice because he was his trainer. 30 He denied speaking to Ms Delf and making inappropriate comments and remarks towards her, especially as to medical questions and surgical procedures: he had not asked her about her miscarriage. It had not been raised with him that he stood too close to people, nor was he aware of brushing past people because he would not get out of their way. In relation to office lunch hours, he said that he did not take the same lunch hour every day and that under the AWA there was no set lunch hour in any event. He said that he was not the only smoker in the office and Mr Williams and Ms Sharlene Edwards were also smokers but he denied taking excessive smoke breaks. He said that no other employee raised with him that he was taking smoke breaks when there was work to be done.

31 In relation to the heated argument that took place late in July 1999, he said that Ms Delf was abusive to him and that everybody was swearing during the course of the argument. He did not feel that Mr Hampton had abused him but he had reacted to the suggestion that he was not being co-operative in insisting on an approach to the FOE which did not involve making a placement fee claim. He accepted that he lost his temper during this exchange after he had been verbally abused. At a later stage, he had apologised to Mr Hampton. Mr Hogan said that he had lost his temper in circumstances where it was made clear to him that being a team player involved making claims for placements which he believed to be wrong. During the argument Ms Delf said to him that he was questioning her authority and alienating her and had worked behind her back to check instructions. About two days later, Ms Delf had apologised to him over this incident. They agreed that the incident should not have taken place to the extent that it had and that the confrontation had got out of control.

32 Mr Hogan said that, in the course of the heated exchange with Ms Delf, he told her that he was only willing to process the FOE in the way in which he had been instructed by Mr Williams - she was aware of that, but stated that they needed the placement statistics as well as the placement fees. During the heated discussion, Mr Hampton had said to him that, if he did not claim a placement fee for a particular person, then Mr Hampton would. Mr Hogan rejected the idea that Ms Delf and Mr Hampton were making these claims because they were using an out-of-date instruction - during the heated discussion, they had both told him that it was necessary to keep up their placement numbers and placement fees. That it why he thought that they were not acting in a mistaken way but, in layman's terms, were fraudulently making claims for these fees.

33 After this heated exchanged took place, he did not raise the issue with Mr Williams because he felt that it would destroy relations in the office and, being the "whistleblower", he would end up losing his job. Mr Hogan denied that he had refrained from raising the issue with Mr Williams in order to keep the matter in his "back pocket" until he needed it. He accepted that he had not raised this issue until confronted by Mr Hall on 11 August 1999 but denied he had kept it a secret until that time. He had raised it in the interview with Mr Hall because Mr Hall had challenged him to provide a reason for there being conflict in the office or he would be sacked. In the course of the interview with Mr Hall and Mr Williams on 11 August 1999 while his ability to get along with his co-workers was raised in broad terms, there was no direct questioning about it.

34 Mr Hogan denied there was anything wrong in arranging to take a day off to see his son participate in a sports carnival - he had arranged with Ms Delf to have the time off in lieu and had it noted in the diary which he understood was normal procedure. He was not aware until about 10 or 11 August that Mr Williams had a difficulty about that matter and it had not been raised with him.

35 Mr Hogan accepted that, during the interview with Mr Hall and Mr Williams, he indicated that he would raise the fraudulent practice of the claiming of placement fees with the Minister but denied saying that he would "dump them in hot water" if they sacked him. He denied that this was a threat and denied that it was a counter threat to Mr Hall's threat to sack him.

36 Mr Hogan accepted that, in an interview with investigators looking into the allegations of fraud that he had raised, he said that he had not told Mr Williams of the heated argument on 26 July 1999 because, firstly, he was not a whistleblower and secondly, that he had decided that it would be best if he left the office with a reference, working sufficient time only to obtain other employment.

37 Mr Hogan said that, a few days after he had been terminated, Mr Hampton had telephoned him and was very apologetic for the fact that he had been dismissed and that he did not realise that the response from the respondent would be so severe. Mr Hogan had then said to him that he had no personal gripes with Mr Hampton and that they had worked well together - Mr Hogan said he was sorry for what had happened and possibly might happen in the future.

38 Mr Hogan said that, when he was back in the office with Mr Hall and Mr Williams and had provided them with some examples of wrongly claimed placement fees, he understood that they would need some time to investigate the details of those cases which he had identified.

EVIDENCE FOR THE RESPONDENT 39 Ms Delf was a major witness for the respondent. In her affidavit evidence, Ms Delf noted that the Windsor office of the respondent operated with a small staff and that team work was "fairly important". While she regarded Mr Hogan's IT skills as being quite good, she thought that he had a problem in accepting instructions from her. It seemed to her that when she gave Mr Hogan instructions he would check them with Mr Williams and if Mr Hogan had a question he would ask Mr Williams rather than ask Ms Delf. She often thought that she would be the most appropriate person to ask and it began to bother her because she felt the applicant was undermining her authority.

40 Ms Delf became concerned, she said, at the applicant's inappropriate sexual comments and remarks. He constantly stared at her bustline while they were talking, and the office receptionist, Ms Edwards, had complained to her about Mr Hogan "inappropriately" brushing against her when he walked past. He had also passed an inappropriate comment about Mr Hampton's son's girlfriend who had come into the office, and had made an inappropriate sexual comment about the figure of a female candidate who had come into the Windsor office to speak to Mr Hampton. At about the same time, Ms Delf had suffered a miscarriage - the applicant asked what she regarded as highly personal and inappropriate questions about her miscarriage, which caused her great distress.

41 Ms Delf thought that the applicant failed to appreciate the small team environment in which they worked. Lunch breaks were normally staggered to ensure that the appropriate number of staff were on duty at all times but Mr Hogan simply left his desk at his lunch break regardless of what work was going on in the office. In her view, that was not in keeping with a small co-operative team environment which had previously been enjoyed in the office. The employees in the office, including herself, Mr Hampton and Ms Edwards, made their disapproval of his conduct known to Mr Williams on a number of occasions.

42 Ms Delf recalled the heated conversation which took place, as she said, on 28 July 1999, involving herself, Mr Hampton and Mr Hogan. As she recounted the story, when she first heard exchanges between Mr Hogan and Mr Hampton, Mr Hogan was saying that it was none of their business to follow up applicants who had found their own employment and that it was an invasion of their privacy to do so. She told Mr Hampton and Mr Hogan that they were both partly correct and explained why there was a follow-up procedure. Mr Hogan is then said to have commented that she always took Mr Hampton's side and had been alienating Mr Hogan since he commenced employment. This prompted Ms Delf to comment that Mr Hogan did not listen to her and was always going behind her back to Mr Williams to check instructions that she had given. Mr Hogan then swore at her. Mr Hogan then swore at Mr Hampton who left the office. At this point, Ms Delf said to Mr Hogan that the heated discussion was getting them nowhere and that they should write down their problems and have a discussion about them the next day.

43 In her affidavit, Ms Delf noted that the office procedures of the respondent were continually evolving around the time these events took place. She later became aware that the procedure in relation to placement fees for candidates who found their own employment had changed. She was aware of a procedure whereby the fee for a person who had found their own employment was claimed but was then inactivated. That procedure had since changed, but the result of both systems was the same, namely, that a placement fee was not claimed by the respondent.

44 The day after the heated argument, Mr Hogan met Mr Delf in her office in order to discuss the issues. He informed Ms Delf that he had tried to ring her the previous evening but no one was home - a point Ms Delf was able to confirm. Mr Hogan had written some points down on two pieces of paper and they began to discuss those issues. Ms Delf said that Mr Hogan accepted that he often spoke to Mr Williams about office procedures because Mr Williams had trained him and he felt comfortable speaking with him and that is the reason he probably spoke to Mr Williams more often, but he also felt alienated in the office. Ms Delf said she raised a number of examples when Mr Williams had not been in the office and where her instructions had been ignored: Mr Hogan is said to have accepted her concerns and agreed to work with her to address those matters. She recalled that Mr Hogan told her that he felt alienated because Mr Hampton was virtually in her pocket. Ms Delf pointed out that she had trained Mr Hampton and he was comfortable talking to her. She also pointed out that she had requested Mr Williams to interview Mr Hogan again for the position - in those circumstances there was no "personal issue" between them. Ms Delf said that Mr Hogan then stated that he accepted that it was necessary to follow up those who had found their own employment: Ms Delf told him that she would also confirm with Mr Williams that the procedures for recording FOE was correct, to ensure that they were all doing it the right way.

45 During this conversation, she recalled that Mr Hogan said that he had discussed the matter with his wife: they both thought that he should look for other employment because things were not working out for him in the office. Ms Delf told him not to be hasty - "This is a minor issue which we will work through". Ms Delf said that at the conclusion of the meeting she felt that she had resolved all the issues of the previous day. She told Mr Hogan that she did not intend to approach Mr Williams about these matters because they had been resolved.

46 Ms Delf said that on 6 August 1999 she had a regular lunchtime meeting with Mr Williams. During this meeting, Mr Williams raised the fact that he noticed that she had a meeting with Mr Hogan behind closed doors the previous week and asked if there was anything he should know. Ms Delf told Mr Williams that there had been a heated argument involving Mr Hogan, Mr Hampton and herself and that they had argued about the procedures for recording FOE. Mr Hogan thought that the procedures she had taught him were different to the way Mr Hogan had been taught by Mr Williams. She said that she had not raised the matter with Mr Williams because she felt she was in control of the situation although things got very personal. She told him that she felt intimidated by Hogan and that his behaviour was often inappropriate and that he made inappropriate comments. She said that when he spoke to her she felt like he was staring at her bustline. Mr Williams said that was the first he had heard of it and she said that she did not wish to make "a big deal about it", but she was not the only one who had complained, as Ms Edwards had also felt uncomfortable. She said that she felt she had got through to Mr Hogan in that meeting and that is why she did not feel she needed to tell Mr Williams about it. Mr Williams said: "That's fine, but Mick's probation is about to expire, if his behaviour and performance is inappropriate, we should do something about it now". Besides mentioning Mr Hogan's inappropriate manner towards herself and Ms Edwards, Ms Delf told Mr Williams that Mr Hogan's habits and ways of doing things were such that he was really making no attempt to fit into the office. She said that Mr Williams agreed.

47 By 10 August 1999, Ms Delf felt that the pressure of what was happening in the office was "getting" to her. She felt there was a barrier developing between herself and Mr Williams because Mr Williams, she thought, was disappointed that she did not consult him immediately about her concerns in relation to Mr Hogan and the argument that had taken place on 28 July 1999. In the course of the day, she received a call regarding her daughter's illness, which had been a concern apparently for some months. In making arrangements to leave the office to attend to her daughter, she came across Mr Hogan kneeling on the floor replacing the arms of his chair in circumstances where she had to get past him to leave the office. It was her feeling that Mr Hogan made no attempt to get out of her path and she felt extremely uncomfortable when she walked past him. She was wearing a skirt and as she walked past him she felt that he was looking at her "inappropriately". As a result of that incident and other personal issues she was facing at home, she felt she could no longer work with Mr Hogan given her personal feelings towards him. She then decided to resign and telephoned Mr Williams and told him of her decision. She said she was very upset and crying but Mr Williams told her not to make any hasty decisions.

48 Arrangements were made for Ms Delf to meet with Mr Williams and Mr Hall early on 11 August 1999. Mr Hall wanted to know why she wanted to resign and she repeated to him the matters she had raised the previous day with Mr Williams about Mr Hogan's inappropriate behaviour towards her and his sexual comments. Ms Delf declined Mr Hall's invitation to lodge a formal complaint of sexual harassment so it could be investigated, telling him that she just wanted to resign. When Mr Hall said to her that Mr Hogan's probationary period was coming to an end and how did she think he was fitting in at the Windsor office, Ms Delf replied that Mr Hogan had certain peculiar habits and that she did not think he was fitting into the office. Mr Hall and Mr Williams then told her that they were going to the Windsor office to speak to Mr Hogan.

49 Ms Delf stated in her affidavit that Mr Hogan did not raise with her any allegations of fraud during his employment with the respondent. She first became aware of the allegations about fraudulent claims for placements after the termination of Mr Hogan. She denied that there was any fraud occurring in the Windsor office.

50 In her oral evidence, Ms Delf was able to say that there were two occasions that she recalled where Mr Hogan used inappropriate sexual comments made in general and in passing. Ms Edwards had mentioned on a few occasions that Mr Hogan had brushed against her when walking past but it was not a formal complaint. There was also, from time to time, a feeling that Mr Hogan stood too close and invaded personal space. For a while, Ms Delf said that she had no problem with this occurrence. In relation to the suggestion that Mr Hogan continually looked at her bustline Ms Delf said that she did not dress provocatively but she thought it was his character or personality where eye contact was not made and she perceived Mr Hogan to be looking at her body: "whether he was or not", she did not know - it was how she perceived it to be.

51 In cross-examination, she recalled the incident where she thought that Mr Hogan had breathed on her legs as she passed him in the corridor while he was on the floor working on assembling a chair. She did not recall asking Mr Hogan to move to allow her to pass. She had never told Mr Hogan that she felt that he was invading her personal space but she knew that others, not her, had raised it with Mr Williams.

52 Later in cross-examination, Ms Delf returned to the occasion when she felt Mr Hogan breathing on her legs as she passed by him to leave the office. She said that circumstances had arisen where she was called home to tend to her sick child and where there had been numerous health problems to cope with. She was very upset at the time. She recalled being so upset that she called Mr Williams and told him that she wished to resign after many years of employment but she regarded herself as being at fault - "I thought I was the sore thumb in the situation". She may have said to Mr Williams at this point, she realised that the problem was her and not Mr Hogan but she agreed that the surrounding circumstances were that her grandfather had recently died, her daughter was ill, and she had had two miscarriages within a six month period. When she was being interviewed the next day by Mr Hall and Mr Williams, she was bursting into tears regularly. It was after this incident of walking past Mr Hogan that she had spoken to Mr Williams and Mr Hall and tendered her resignation. She was satisfied that personal issues had been resolved with Mr Hogan but came to realise that if she could not cope with her personal issues then she should "get out of the kitchen". She made the decision to resign because of other influencing factors within her own life including a sick child. She thought that if she was not able to give Mr Hogan the benefit of the doubt and put these matters behind her then she should get out. She regarded it as a "one on one thing" between Mr Hogan and herself - that was her perception of it. The argument was a contributing factor and, although she was satisfied it was resolved, it accumulated with her life outside work - where she was heading personally, her health, the health of her child and she came to feel that she could not cope with these things at that time. It did not occur to her that, when she was tendering her resignation to Mr Williams she was putting him in the position of choosing between her and Mr Hogan. After making that call to Mr Williams, she met with Mr Williams and Mr Hall the next day. She was given the opportunity of making a sexual harassment complaint but chose not to do so because she accepted Mr Hogan's word that his actions were unintentional. She continued to believe that things were resolved between them but there were other things happening in her life and she came to the conclusion that she could have been the problem. She told Mr Williams and Mr Hall that she was not there to lodge a sexual harassment case. Although Ms Delf did not remember the words precisely, she may have said to Mr Williams and Mr Hall that she was "hormonal" and, with all the other things she had mentioned, she just wanted to go and leave it all behind her. She told Mr Williams and Mr Hall that Mr Hogan's actions might not have been deliberate but unconscious actions. She did not envisage there would be any repercussions over her resignation. While Ms Delf regarded herself as at fault, she said there were situations in the office that she perceived to be inappropriate behaviour between a female and a male employee and she believed that, on 11 August 1999, Mr Hogan had sexually harassed her but she did not wish to make a complaint. She had formed that view even though she also thought that the fault was hers and that the overall circumstances of her life were getting her down. Ms Delf did not proceed with her resignation but in December 1999 was transferred to another office.

53 Ms Delf said that earlier on in Mr Hogan's employment she felt that he did not respond to her instructions but she accepted Mr Hogan's explanation that Mr Williams had trained him and that he was doing a particular project for Mr Williams: he apologised to her if his approach had been taken the wrong way and said that he would try to respond more appropriately. Ms Delf said that there had been talk amongst the staff - there were "little idiosyncrasies" about Mr Hogan that made people feel uncomfortable. He was a very intimidating character who invaded people's space when he spoke to them. In other things he was skilfull, especially possessing very good IT skills and would volunteer to do work in that area which was accepted.

54 When Ms Delf was interviewed by investigators looking into the allegation of fraud in the office, she accepted that, in the course of a long interview, the first 13 pages of the transcript of that interview revealed that the only issue she had raised to that point was Mr Hogan's invasion of personal space. Mr Hampton had also raised his objection to Mr Hogan using the toilet and leaving the door open, exposing Mr Hampton to lingering odour. These were the types of things discussed by staff about Mr Hogan.

55 Ms Delf accepted that not a great deal in the way of complaints had been raised until about 28 July 1999 when the heated discussion took place in the office. She accepted that she told the investigators that on that day there was a disagreement between Mr Hampton and Mr Hogan in which she intervened. She thought something that was being said by Mr Hogan was not completely correct and told him so, to which Mr Hogan replied that he was performing the function as he had been trained to do by Mr Williams. Ms Delf then described the argument as getting very personal, at which stage Mr Hampton left the office. Her view was that the matter was "over" and it was to be taken up with Mr Williams the next morning to find out which way the matter was to be pursued. After she and Mr Hogan met the following morning and discussed the issues, she believed that the "particular situation had been resolved" - Mr Hogan had accepted her advice and would not speak to Mr Williams and would not tender his resignation, but would work through for a few weeks to see how things worked out.. She had put it to rest. According to Ms Delf, she did raise the issue of policy with Mr Williams who explained to her the way to process the FOE. She thought that the way Mr Williams had shown Mr Hogan had not yet filtered down to her and that may have been because her attendance at the office had been spasmodic because of the illness of her child. Ms Delf said that she raised the issue at a lunch meeting with Mr Williams but did not mention that there had been an office argument over it - she felt, as the senior, intimated being the female supervisor, that she wanted to be in control of the situation, and, wanted to think she could resolve it. She did not dwell on the incident but simply looked for information from Mr Williams.

56 Ms Delf indicated that she knew little about placement fees being claimed in relation to people who had found their own employment, even when interviewed by the investigators. She said that she was not aware that any claims had been made. When it was pointed out to her that matter was the subject of the argument between Mr Hampton and Mr Hogan in which she intervened, she stated that she was not involved "in that side of the dispute". She had intervened and told them that they were both right and that the outcome was the same, although she could not remember precisely what words she had used. She thought that neither of them had the process correct and that after she had intervened "it was over and we were going to take that up with Steve and find out the way Steve wanted that pursued". Ms Delf said she was unable to resolve the argument by reference to an instruction because she felt the work manuals were not up to date. Her own knowledge and procedure was obtained though trial and error. Ms Delf could not explain why she did not check with either the on-line copy of the manual or the hard copy of the manual - the thought never crossed her mind. She ultimately raised the issue with Mr Williams and explained the way she was doing it and he showed her the way it was to be done but noted that there was no different result in any event. She said that the applications that went through where a fee was wrongly claimed, in her case, was the result of "sheer human error", being her own error. Ms Delf accepted, ultimately, that Mr Hogan was saying that the claims were being processed wrongly and the office was obtaining a fee for which it was not entitled. Ms Delf then said that she felt the argument was about expecting the employer to confirm an interview had taken place with the client - the argument was really about one job seeker and reporting, it was not about fees being improperly sought because "the first I heard about that was when it was in the newspaper". Somewhat confusingly, Ms Delf also accepted that part of the discussion was about processing the FOE. Although Ms Delf said she had told them that they were both right and were both wrong, she could not recall Mr Hampton doing anything wrong. Ms Delf explained her indecision in the following way: I am only remembering now from notes but at the time from what I remember at the time is that only Mick believed that he had the current procedure for the placement, but he did not believe that it was our business to pursue the placement. So I guess from my perspective there seemed to be a void in the actual understanding of the system which in the first three months of employment I would not expect one to because it certainly took myself a long time and I had come from a CES background where it had been used for a long time.

57 Ms Delf seemed to explain that her approach, because of the difficulties of the computer programme, was to activate the fee payment and deactivate it so that it would not be paid. When a number of entries were drawn to her attention during the interview with investigators, she pointed out that she had attempted to deactivate some of the examples that were being shown to her in that interview.

58 Ms Delf was aware that bonuses were available by way of performance pay of 5 per cent per annum if levels were met and suitable performance results achieved. In her employment with the respondent no such bonus was ever paid. She was also aware that targets were to be set but, at the time of Mr Hogan's employment, she did not believe they had been set either for the office or for the individuals.

59 When Ms Delf's attention was drawn to her interview with the investigators and her involvement in the heated discussion, she confirmed again that it was partly about one job seeker and contacts with their employers. In relation to both Mr Hogan and Mr Hampton being partly correct in what they were saying during this argument, she then expanded that they both seemed to be guessing and that, ultimately, it even included herself. Although she could not remember precisely what she said, Ms Delf again agreed that she had raised the issue of placement fees for FOE with Mr Williams and he confirmed that he wanted them done the way he had told Mr Hogan to do them. She did not recall Mr Hogan saying words to the effect that if an FOE were not handled the way in which she had been instructed, a placement fee would be wrongly generated. In the interview with investigators, Ms Delf told them that the matter blew up very quickly and then was over. Ms Delf also said that matters in the office got personal because of the fact that she was a supervisor within the office and from time to time Mr Hogan's direct supervisor, and she felt that he would not take direction or delegation from her.

60 Ms Delf described the meeting which took place on the day following the argument as being "very pleasant". Mr Hogan had a number of issues to raise and they worked through them. Mr Hogan told her that he had discussed the issue with his wife and thought it would be best if he looked for other employment and that all he wanted was a fair reference. Ms Delf told him that she did not think it was necessary for Mr Hogan to resign. She had suggested they should let things progress for a while and if it did not work they could both go to see Mr Williams. The issue, as far as she was concerned, was "all over". She had told the investigators about her perception of this conversation and that she was comfortable with Mr Hogan's explanations and she was "happy it was over until this then raised its ugly head", "this" being a reference to the alleged fraudulent placement claims.

61 A further complication and confusion then arose. Ms Delf accepted that about a week after this heated argument and her discussion with Mr Hogan where the issues, in her firm view, were resolved with Mr Hogan, Ms Delf had a conversation with Mr Williams saying that Mr Hogan was making no real attempt to fit into the office. When questioned how she came to be making that statement to Mr Williams only a week after she had resolved her differences with Mr Hogan, Ms Delf said there were two different things being talked about. She accepted that they had resolved the issues that arose in the argument: she was happy with his explanations about the argument but there were still difficulties in the "bigger context". While she had finalised those issues arising from the argument with Mr Hogan, the things that she raised with Mr Williams on 6 August 1999 arose in the context of a regular meeting she held with him as a senior officer meeting the manager and discussing a number of issues including staffing. In her view, Mr Hogan should not have resigned over the argument but if he had to resign it should have been over the entire issue not just over the argument that had taken place. She did not know whether she had told Mr Hogan this or not. She thought he was struggling to fit into the office but it was not worth resigning over the argument because that was "trivial". When asked why she did not explain to Mr Hogan why he should resign when he had raised the subject of his resignation, she said that it did not arise in "the context the way the conversation flowed" - she would have seen no cause to raise the wider issue with him. She saw some issues as being personality faults which could be dealt with in a bigger office but they did not have a bigger office. She did not know whether Mr Hogan could change but it was not her "call". She was responding to a question from Mr Williams as to whether Mr Hogan was fitting in or not. That was the context in which she made her adverse comments about Mr Hogan. However, she did not tell Mr Williams that she thought Mr Hogan was looking at her bustline but she did raise that issue a few days later when she tendered her resignation and met with Mr Hall and Mr Williams. She had never raised that issue with Mr Hogan, not even in their meeting to sort things out, which was held the day after the heated argument. She accepted that when she met Mr Hall and Mr Williams she was constantly in tears. She told them that after the heated argument there had been a general clearing of the air, the dispute had been resolved in a meeting the next day which had been conducted in a calm and professional manner and she had been pleased with the way it went. Ms Delf said she also felt that a barrier had grown between herself and Mr Williams in the office because she had not told him immediately about the argument with Mr Hogan. She thought there was pressure building in the office and that Mr Williams thought that he should have been told about the issue. She did not tell Mr Williams that Mr Hogan had been thinking of resigning because she thought that was an issue between Mr Hogan and Mr Williams.

62 In the interview with the investigators, Ms Delf recalled a conversation after the heated argument where Mr Hogan said he wished he could be sacked because he could then go back onto benefits while he was looking for work: Ms Delf told him that would not happen because "we don't have a problem, we've just worked through it all". When cross-examined as to the accuracy of that statement, bearing in mind the fact that she had other issues, Ms Delf insisted that, so far as the argument was concerned, that statement was certainly true. Ms Delf said the only reason she spoke about the argument with Mr Williams was because he demanded to know what had taken place in the meeting between Ms Delf and Mr Hogan, a meeting he had observed to take place behind closed doors within the office. According to Ms Delf, Mr Williams demanded to know why her door was closed.

63 The term "sexual harassment" had not been used by Ms Delf when speaking with Mr Williams and Mr Hall - they had raised that prospect but she had declined to make a formal complaint. She accepted that on 6 August 1999 she had told Mr Williams that Mr Hogan was not fitting in, that he was staring at her bustline and that his behaviour was often inappropriate but that was a separate issue to the argument which had been resolved. In her view, "fitting into the office is very different to working with me one on one".

64 While Ms Delf said that she had clarified with Mr Williams on 6 August 1999 the correct way of processing FOE she also accepted that on 9 August 1999 she had wrongly processed one such application but said that was simply a matter of human error. She denied the proposition put to her that she had not sought clarification from Mr Williams about the processing of FOE because she knew the proper way to process them all along. Ms Delf said she could not deny saying during the heated argument that the way she and Mr Hampton were processing FOE was the way everybody was doing it and it was widespread practice across Employment National.

65 Ms Delf also accepted in cross-examination that she had no complaint about Mr Hogan's work. Ms Delf said she had told Mr Hogan not to speak to Mr Williams about resigning and getting a reference because he would be "suspicious", but the context in which she said that was explained in the following way: I remember saying that Steve would become suspicious but I think it is a little bit out of context of the conversation we were having at the time; we had resolved the situation; we agreed we would give it a couple of weeks before he went to Steve for a reference … . … I want him to give it a couple of weeks so we could make a go of it; it had workplace implications if we lost an employment consultant so soon after losing Kate. We had had a placement made, Mike Hogan's consultancy certainly filled a void in the workplace". She denied that the use of the word "suspicious" was a reference to Mr Williams wanting to know what the argument was about and having to disclose it was about the wrong claim for a placement fee. She said in her view, Mr Hogan's resignation had nothing to do with the FOE - it was just that he felt alienated and they were trying to make an effort and he should not be so hasty in leaving. In her view, Mr Williams might become suspicious because that was his nature but it had nothing to do with her concern that Mr Williams would be told of the wrongful claim for placement fees. In any event, she did not believe that she was processing the FOE the wrong way. What she had admitted to Mr Williams was a tracking process, in offering a candidate support and the placement of a Felx 3 candidate, in the intereface between the office system and the Government system.

66 Mr Hampton, in his affidavit, spoke at length about the system of dealing with job seekers and the capacity for errors to arise in the system used by the respondent. He denied that he was involved in any dishonesty or fraud in dealing with FOE cases, nor was he aware of any other person who worked in the Windsor office of the respondent who benefited financially or otherwise in relation to dealing with FOE cases.

67 Mr Hampton said that the applicant's behaviour began to bother him as time went on during his employment with the respondent. In his view, Mr Hogan took an excessive interest in the personal lives of the staff and their telephone conversations. He was offended by some comments of a sexual nature made by Mr Hogan. He also found it uncomfortable that Mr Hogan would invade the personal space of people when talking to them - he would stand extremely close to them, whether male or female work colleagues.

68 He recalled witnessing the incident where Mr Hogan was on the floor fixing an office chair and "slightly blocking the entrance" to Ms Delf's office. In Mr Hampton's view, Mr Hogan appeared to deliberately make no attempt to get out of her way to let her pass by. He also thought that Mr Hogan had difficulty in receiving and following directions given to him by Ms Delf and that he would constantly verify her instructions with Mr Williams. He felt that the working team became less harmonious after Mr Hogan arrived, especially with Mr Hogan taking his meal breaks at the allocated time irrespective of work requirements when everybody else was being flexible to ensure the work was done.

69 While he believed that he had a fair working relationship with Mr Hogan, he recalled the strong disagreement which occurred on 28 July 1999 in relation to the treatment of an FOE case. Mr Hampton did not recall that Mr Hogan identified any alterative way of processing FOE cases and formed the view that Mr Hogan had little or no contact with such cases, unlike the experience he and Ms Delf had in processing them. The argument had become heated and Mr Hogan had sworn at him and Mr Hampton had left the office.

70 Mr Hampton was unaware of any complaint made by Mr Hogan about fraud in the Windsor office while he was employed there. He confirmed that he was not consulted or involved in any decision concerning the continued employment of Mr Hogan.

71 In oral evidence, Mr Hampton said that until the time of the heated argument he had no problem with Mr Hogan and they had "got on quite well together at work … there was no real problem …". Mr Hampton had difficulty recalling the circumstances of the argument but said it started off as a discussion and "just got a bit heated". Mr Hampton could not recall the precise details of the heated discussion but knew it related to the registering of FOE cases on the system. He had told an investigator that the argument related to whether or not the office should contact an employer after being notified that an employee had obtained their own employment. Mr Hampton was aware that the discussion became broader but he could not recall the details.

72 Mr Hampton accepted that he told the investigators that he had wondered why the argument had become so heated between Mr Hogan and Ms Delf but he learned later that it was not really about processing at all. It was about "other things that had built up". He said that during the discussion Ms Delf exploded and was angry. He had later learned that she had been sexually harassed by Mr Hogan but he knew nothing about it at the time of the argument.

73 On further cross-examination about answers he had given to the investigators, Mr Hampton accepted that placement fees for FOE had been part of the argument. He thought he whole thing had started with the FOE. 74 Mr Hampton accepted that he had no difficulty with Mr Hogan until Ms Delf had told him certain things. After Mr Hogan had been terminated, Mr Hampton telephoned him because he did not like to see an underdog lose his job. He could not recall what he said in that conversation.

75 While Mr Hampton did not appreciate some of Mr Hogan's personal habits he had never been offended by him while working with the respondent. 76 During the heated argument, Mr Hampton could not recall saying to Mr Hogan that, if he did not claim the placement fee for an FOE, Mr Hampton would. Mr Hampton said that he had not written anything down and he now had little memory of what was said.

77 The office worked under key performance indicators and the members of the office had to perform but Mr Hampton did not feel he was under any pressure at work because of those matters. He understood that placements had to be made but he was not aware that there was a certain target that had to be met. After being shown an office document, Mr Hampton agreed that there were annual targets set for the office. He also accepted that individual performance reviews looked at certain objectives and included the number of placements. Although individuals did not have targets, there was discussion in the office about the number of placements made and achieving placements. Later, in cross-examination, Mr Hampton accepted that he knew that a placement fee should not be claimed for FOE but there were other claims that could be made and there appeared to be a systems problem. People in the office were not always able to get into the system and change it to stop the payment being made - it was an interface problem in the system but there was never any intention to take money that was not due to the respondent.

78 After the heated argument, Mr Hampton had no recollection of raising with Mr Williams the proper way to process FOE. In relation to placements he had processed, Mr Hampton stated that there were many mistakes made. He did not understand the system then and confessed to not really understanding the system now. Nevertheless, he had told Mr Hogan during the argument that he knew more about the procedure than Mr Hogan, who had just joined the respondent. Mr Hampton could not explain why they were having an argument about placements if he did not understand the system - it just blew up as an issue. Mr Hampton confirmed that Ms Delf had been primarily responsible for training him in the work.

79 Mr Hampton had read about the allegations of fraud made by Mr Hogan when the matter was written in The Sydney Morning Herald. He was quite put out about the whole thing when he read about it, and then became involved in a Departmental investigation.

80 Mr Hampton said he had no involvement or knowledge of Mr Hogan's dismissal until the day it happened.

81 Mr Williams was the manager of the Windsor office of the respondent. He said that after Mr Hogan had started he appeared to perform well and was bright and interested in the work. Mr Williams trained Mr Hogan because Ms Delf was absent on sick leave at the time.

82 In July 1999, Mr Hampton and Ms Delf informed him that Mr Hogan was taking a lot of cigarette breaks: because Mr Williams had not observed this occurring he did not raise the issue with Mr Hogan. While he had given Mr Hogan a good personal assessment in July 1999, Mr Williams formed the view about mid-July that there was a change in the atmosphere in the office. The office appeared to be tense.

83 Mr Williams expressed concern on about 2 August 1999, when he believed that Mr Hogan had left the office short handed while taking leave to see his son perform at a school sports carnival. He did not believe that Mr Hogan had adopted the correct procedure for taking the day off. 84 It was not until 6 August 1999 that Mr Williams had a meeting with Ms Delf and raised with her Mr Hogan's performance in the office in light of the fact that his probationary period was coming to an end. Mr Williams also wanted to find out what had occurred in a meeting between Ms Delf and Mr Hogan which he observed had taken place behind closed doors in the office.

85 In this meeting, Ms Delf informed Mr Williams that, while she had no difficulties with Mr Hogan's work performance, there were personal difficulties - she felt sexually harassed by him and that when they were talking he was always looking at her breasts. Ms Delf and Mr Hogan had met the previous Monday and she had told him that this behaviour was inappropriate and as a result of the conversation she believed that the issue had been resolved. Ms Delf also raised with Mr Williams the fact that Mr Hogan frequently asked for advice and then double checked with Mr Williams. Mr Williams told Ms Delf that he was not happy with the way in which Mr Hogan had recently taken leave when the office was considerably understaffed and that his behaviour was not in keeping with what was necessary for office teamwork and the need to support each other to maintain the operation of a small business centre. He told Ms Delf he would raise these matters with Mr Hogan. Mr Williams also stated that he needed to understand the issues between Ms Delf and Mr Hogan because his probationary period was coming to a conclusion. Ms Delf told Mr Williams that she believed that she could continue working with Mr Hogan.

86 At the end of that day, Mr Hogan approached Mr Williams and asked to be provided with a reference because he was in the process of looking for another job. Mr Williams said it was a surprise and told Mr Hogan to calm down. He said the request for a reference was premature and they should discuss the issue to see if the problems could be resolved, including those that had been raised with him by Ms Delf. An arrangement was made to speak later when Mr Williams had more time available. 87 On Monday 9 August 1999, Mr Williams obtained some advice about the operation of probationary employment because he had doubts whether he should retain Mr Hogan, especially since he had expressed his desire to leave. He spoke to Mr Foster, the general manager of Human Resources, and was advised that he had to determine whether the probationary employee was the "best fit" for the organisation. He was told by Mr Foster that, if he was not satisfied about that matter, then it was easier for the respondent to dismiss the employee during the probationary period or at the end of that period rather than after the employee had become permanent.

88 Mr Williams said that he had not made up his mind about Mr Hogan's continued employment particularly because he had not properly met with Mr Hogan and obtained his perspective about the working relationship with Ms Delf and the changed office atmosphere. He met Mr Hogan on Tuesday 10 August 1999, and raised with him the fact that he had noticed "a team dynamic problem". Mr Hogan told him that there had been an argument between himself, Mr Hampton and Ms Delf and that he had a long discussion with Ms Delf at the next possible opportunity after that argument. Mr Hogan then asked Mr Williams what Ms Delf told him at the meeting they had held the previous Friday, which Mr Williams declined to do. When asked what the problem between himself and Ms Delf was, Mr Hogan said that he still did not know - it was a personal thing and Ms Delf had accused him of alienating her within the office because he went to Mr Williams for assistance which had already been provided to him. There was a discussion about pay and pay policy and Mr Williams also raised his dissatisfaction with the day off Mr Hogan had arranged, leaving the office shorthanded. Mr Hogan said he was not prepared to break his little boy's heart and appeared to become annoyed about the issue. Mr Hogan doubted that a round table discussion would alter anything - he felt that he now had to drag himself to work. Mr Williams said he was concerned because the office was under staffed, they were below target and he was now concerned about his small team.

89 After his discussion with Mr Hogan, Mr Williams said that he was "inclining towards not continuing his employment". The reasons identified for this view were: (a) what was regarded as the applicant's deceitful behaviour about the leave he had taken early in August 1999 without considering the office's requirements; (b) constant complaints by Mr Hogan regarding fellow employees and constantly seeking salary details for other employees, despite being told that this was inappropriate; (c) Mr Hogan's general attitude of dissatisfaction with his employment and the fact that he was looking for employment elsewhere; and (d) Mr Williams' concern at the working relationship between Mr Hogan and Ms Delf and the allegations of sexual harassment which she had raised.

90 Mr Williams said that, on the same day but after interviewing Mr Hogan, he had a brief conversation with Ms Delf. She enquired how the meeting had gone with Mr Hogan and he told her that they would have to talk again because he had been given a different version of the problem and he was still thinking about it. Ms Delf had to leave the office because of the illness of her daughter.

91 It was shortly after this meeting that Mr Williams received a telephone call from Ms Delf on her mobile phone. Mr Williams said she was upset, that she did not know if she could manage the sexual harassment and that she had been seeking advice. She said words to the effect that maybe it was everything that was going on, her miscarriages, her daughter's illness and asked why she was putting herself through this, and then stated "I think I'll resign". Mr Williams suggested that she do no such thing at that very moment and he would call her back. Mr Williams then rang the regional manager, Mr Hall, and arranged them to meet Ms Delf at the Penrith office at 8.30 the following morning. He confirmed those arrangements with Ms Delf.

92 At this point Mr Williams described the situation in the following terms: After Ms Delf telephoned me, I was extremely concerned because I had a situation where my senior employee was threatening to resign and was obviously upset.

93 The meeting between Mr Williams, Mr Hall and Ms Delf took place on 11 August 1999 at the respondent's Penrith office. At this meeting, Ms Delf spoke about feeling sexually harassed by Mr Hogan and also recalled an argument involving Mr Hampton and Ms Delf in late July 1999. She described that argument as a work question where Mr Hampton's answer to Mr Hogan had been disputed and where Ms Delf said she had "just let go" and the following argument had been "ugly, very ugly". Ms Delf told them that she had the feeling after the discussion that they had aired their views to one another and that " that was it". Ms Delf told them that the following morning Mr Hogan had asked to see her and spoke about the issues that they raised the evening before. It was Ms Delf's suggestion that there was no need to involve Mr Williams in their discussion and that was agreed.

94 During the course of the meeting with Mr Williams and Mr Hall, Ms Delf said that she generally found Mr Hogan to be inappropriately curious about her health problems and specifically about her recent miscarriage. She also raised her feelings that she was being sexually harassed by Mr Hogan but in the end did not want to raise the issue directly with him. She told them she felt that she could continue to work with the applicant "in the short term". The meeting lasted for approximately two hours. 95 Mr Williams then records that a meeting was convened later that day at the Windsor office with Mr Hogan with the purpose of speaking to him in relation to the prospects of his probationary employment being made permanent. Mr Hall was present at this meeting. At the meeting Mr Williams raised the fact that Mr Hogan had told him that he was seeking a reference to look for new employment and that Mr Hogan had told him that he did not see a future working long term at Windsor or for the respondent. Mr Hogan told them that he was only seeking other work because of an issue that had arisen between himself and Ms Delf. Mr Hall told Mr Hogan that, as he was looking for other work and that his probationary employment was coming to an end, it was a good opportunity to have a discussion about his future with the respondent. Mr Williams said that Mr Hogan was very curious about what Ms Delf had told them but he was informed that this was the opportunity for him to deal with his own situation. Mr Williams raised his feeling that there was an "atmosphere" in the office and that no one had brought any issue to him but that some complaints about other staff were now being made in the process of his enquiries. Mr Hogan told them that he was feeling alienated within the office although he got along reasonably well with Mr Hampton - nevertheless, he felt that Mr Hampton and Ms Delf were very close and thus he was alienated. Mr Hogan said there was a problem with Ms Delf although he was not sure what it was and he had even made enquiries of her. He again enquired as to what Ms Delf had said and continued that he would be able to work in the short term with Ms Delf as his supervisor but that on a long term basis it was not going to work.

96 During the course of this interview, Mr Hogan apparently made it clear that he wished to remain with the respondent for the short term while he continued to look for other work although he stated that he was "no martyr". When Mr Hall raised with him the cost of ongoing training and development and that it might be reasonable for Mr Hogan to initiate the termination of his employment, Mr Hogan then made "an alarming statement", saying that, if he was put off before he could find another job, he would go straight to the top about some of the things happening in Windsor. He said he would go to the authorities and anyone else he could think of about illegal and immoral actions at the Windsor office. Mr Hogan denied making a threat and Mr Hall asked him to put on the table what he felt was the problem at Windsor, encouraging Mr Hogan to be open so that the matter could be discussed. Mr Hogan then told them that staff at the office were claiming fees where there was no entitlement mentioning specific FOE placements. The procedure in relation to this matter had been made clear to him and everyone else in the office and had been talked about in the office an several occasions as to the appropriate procedure. Mr Williams asked why it had not been raised with him to which Mr Hogan replied that he was "no whistleblower". Mr Williams told him that his judgment was very poor in raising the issue now and it should have been raised as soon as he became aware of it.

97 Mr Hogan provided some names of job seekers in relation to whom wrong placement claims had been made. The group went back to the office and obtained printouts from Mr Hogan's computer to allow Mr Hall to continue his investigation of the matter.

98 After this meeting, Mr Williams and Mr Hall discussed, over lunch, what to do with Mr Hogan. Mr Williams said that he was concerned about terminating his employment given the fraud allegations now raised by Mr Hogan. He did not want to be seen to be terminating his employment because of the allegations of fraud; rather, he wanted to terminate on the basis of performance and attitude problems which he had identified. Mr Williams raised with Mr Hall the problem of Mr Hogan's attitude to taking the day off and not seeing anything wrong with that, his unhappiness with his salary and his job generally and the fact that he was looking for work elsewhere. At the conclusion of that discussion, Mr Williams said that he did not see why the respondent should continue Mr Hogan's employment after the probationary period. On 13 August 1999, Mr Williams wrote to the applicant advising him that his employment would be terminated that day. Mr Williams confirmed that even without the allegations of fraud he would have terminated Mr Hogan's employment at the conclusion of the probationary period.

99 In cross-examination, Mr Williams accepted that as at 21 July 1999 he was satisfied with Mr Hogan's performance in the position. He accepted that he had written a personal note to Mr Hogan together with the performance review form which he had completed. The note said: Mick, Thank you for your efforts. I think we are all working in well. Regards, Steve Williams Mr Williams agreed that this represented his view and his thoughts at the time and that his comments were "appropriate" then.

100 Mr Williams' attention was drawn to the performance review form which gave ratings from one to five: a rating of four was one that the person fully met the requirements being assessed, while a rating of five was an assessment that the person exceeded the job requirement. Apart from a small number of matters which were not applicable to Mr Hogan, he rated fours. Mr Williams had scored Mr Hogan at four, fully meeting the requirements, in relation to area of competencies identified as "inter personal" and "team working". Overall, he had been assessed as satisfactory and meeting all the requirement of the position.

101 Mr Williams confirmed that there were regular staff meetings where the office's target and objectives were discussed. There were no individual targets in relation to placements, but an overall target.

102 As at 21 July 1999, Mr Williams accepted that he had no concerns or problems with Mr Hogan's performance. Mr Williams first started having concerns about Mr Hogan's performance when he did not attend for work on or about 1 August 1999. This concern was first raised with Mr Hogan a week later, on 10 August 1999. Mr Hogan explained that he had made the arrangement with Ms Delf and had notified it in the appointment book.

103 Mr Williams said that he did not place much store in the complaints about the excessive smoking breaks taken by Mr Hogan and that he preferred to let people work out their relationships over time. In the interview with Mr Hall, Ms Delf told them of an office argument late in July 1999 but spoke only in general terms and he could not recall Ms Delf dealing with the specifics of the argument. There was a lot of vague "going around of how she felt" and there was no great discussion other than the business about her feelings of "so called sexual harassment". Mr Williams recalled that he asked Ms Delf what were the difficulties and then "the sexual harassment stuff loomed out of the mist". He said he thought to himself "Goodness me, what have we got here?". He had thought this to himself when Ms Delf first raised sexual harassment issues at the meeting on 6 August 1999. The meeting of 11 August 1999 had been arranged specifically to deal with Ms Delf's complaint of sexual harassment at the workplace. While Mr Hogan had been at the office, Mr Williams said that Ms Delf had never raised with him anything about a dispute concerning claims for FOE placements. He said that the matter was talked about all the time in the office and how the system worked, what was claimable and what was not, but the system was changing all the time - it was something of a shemozzle.

104 Mr Williams did not think that the examples taken from the computer in the office after Mr Hogan had raised his allegations provided support for those allegations. The documents were taken by Mr Hall who virtually took over the investigation. In fact, Mr Hall directed him not to further look at those records and Mr Williams certainly conducted no independent investigation. Mr Williams accepted that the documents provided by Mr Hogan showed placement fees had been claimed for persons who had found their own employment.

105 Mr Williams also accepted that, in an interview with investigators, he had told them there was additional remuneration available if targets were met and the business centre deserved it, but he was unaware of the details of how it operated.

106 The meeting involving Mr Hall and Mr Hogan held on 10 August 1999 was not necessarily a meeting called to give Mr Hogan an opportunity to convince Mr Williams that he should continue in employment. Mr Williams had grave reservations about the continuation of his employment and that is why the meeting was held. Mr Williams was looking for a reason why Mr Hogan should stay rather than finish up.

107 In relation to the investigation into unjustified placement claims, Mr Williams accepted that he had processed none of them. It had been an issue talked about in the office and the appropriate procedure to adopt in relation to FOE.

108 Ms Delf had raised sexual harassment, but in the meeting with Mr Hall and Mr Williams said she did not wish to make a formal complaint but raised the matter again: ultimately, Mr Williams said that matter formed no part of his decision to terminate Mr Hogan. Working relationships in the office were part of the decision making process but he did not consider that the placement claims made by others in the office, which Mr Hogan refused to make, might explain why he was not getting on with other staff. Mr Williams accepted that could be correct "if it happened", but he did not take it into consideration.

109 Mr Hall was the metropolitan Sydney Regional Manager for the respondent. He had known Mr Williams for a number of years at the CES before joining the respondent and Mr Williams had often sought his counsel regarding business matters. Mr Williams had told him that he had concerns in relation to Mr Hogan's ability to work as part of a team especially in a small office environment. He had been told by Mr Williams that Mr Hogan indicated that he was not committed to working for the respondent in the long term and was actively seeking alternative employment. Mr Hall advised Mr Williams that if he had any doubts about Mr Hogan he would be better off terminating his services during the probationary period. Mr Williams had asked Mr Hall to come to the office to speak to Mr Hogan about his employment. Mr Williams also indicated that Ms Delf had indicated that she wished to resign because of Mr Hogan's conduct towards her - allegations of sexual harassment had been made against Mr Hogan. Because Mr Hall knew Ms Delf quite well, having worked with her for a number of years at the CES, he offered to meet her and Mr Williams and to investigate the substance of her allegations. This meeting took place on 10 August 1999 at the Penrith office.

110 In this meeting Mr Hall asked Ms Delf why she wanted to resign. Ms Delf replied: Bob, I can't take it any more. I am finding it very difficult to work with Mick Hogan. He makes inappropriate comments all the time. He keeps staring at my bustline whenever I am speaking to him. He does not follow my instructions. He can't take instructions from a woman. I can't deal with it any more. I have a lot of personal problems at home. I just don't want to face it any more. Mr Hall said that he informed her that this conduct may be considered sexual harassment and that Ms Delf would need to make a complaint so that it could be fully investigated. However, Ms Delf declined to make a complaint, saying: "It's probably me. I have been having a lot of personal problems especially since my miscarriage". Mr Hall nevertheless pressed her to make a complaint so that it could be investigated, telling her that if no complaint was made, nothing could be done about it. Mr Hall then stated that Mr Hogan was on probation and asked Ms Delf about his performance to date. Ms Delf replied to the following effect: I think he is not making any effort to fit in or work as part of the team. We are such a small office, everybody needs to chip-in. He is not flexible. He always takes his full lunch breaks regardless of what is going on. He does not help out when needed. He takes a lot of cigarette breaks and he can't take instructions from me. He is always going to Steve to ask him whether he should be doing what I am telling him to do. I just don't think he's coping with the small office environment .

111 Later that morning, Mr Hall and Mr Williams attended the Windsor office and spoke to Mr Hogan outside the office. Mr Hall said that much of the conversation was led by Mr Williams, who raised with Mr Hogan the fact that he was looking for other work and, although his technical skills were quite good, there was a lot of concern about his attitude to the job and his ability to fit in and work in a small team. When Mr Hogan asked what was meant by the reference to his attitude, Mr Williams told him about the day off he had taken without giving him the courtesy of being informed and the fact that his concern for his son demonstrated that he was not a team player.

112 Mr Hall then said to Mr Hogan: The fact of the matter is, we invested a lot of time and money training you. Your probation in coming to an end, if you don't intend to stay with us why should we continue to invest in you? Mr Hogan replied that if he was going to be fired he would "dump hot water on them like they would not believe". He was asked to specify the problem and replied that he was not a whistleblower. Finally, Mr Hogan told them that there was fraud going on in the office with people claiming job placement fees for candidates who found their own employment.

113 Mr Hall was surprised at this comment. His knowledge of the office was that it was one of the worst performing in the metropolitan area and rarely met its financial targets. He considered it therefore highly unlikely that there was systematic fraudulent activity going on in the Windsor office as alleged by Mr Hogan. He nevertheless took the allegations seriously and indicated that, if they were true, others would be dismissed and only Mr Hogan and Mr Williams would be working in the Windsor office. They then went back to the office where Mr Hogan produced copies of documents from his computer to support his allegations. Mr Hogan was told that the matter would be investigated by Mr Hall and Mr Williams.

114 Mr Hall and Mr Williams then met over lunch to discuss Mr Hogan's continued employment. Mr Williams repeated his concerns about Mr Hogan's attitude and commitment and his inability to work in a small team environment but also expressed reservations as to whether the allegations made by Mr Hogan would impact on the respondent's ability to terminate his employment. Mr Hall advised him to put the allegations to one side. Those allegations had to be fully investigated but Mr Hogan's performance to date had to be assessed, ignoring the allegations. If Mr Williams had any doubt as to Mr Hogan's abilities or commitment then he must terminate Mr Hogan's employment while he was still on probation, because "once you confirm his employment at the end of the probation, we are stuck with him". There were also consultations with the respondent's Personnel Manager and General Manager of Human Resources, Mr Foster, before the letter of termination was sent to Mr Hogan.

115 In cross-examination, Mr Hall said that, although he was aware that Mr Hogan had a performance appraisal in July 1999, he did not see the results of that appraisal.

116 Because there was an absence of a formal complaint by Ms Delf, he did not regard the discussion on 10 August 1999 about sexual harassment as warranting investigation. When Ms Delf declined to make the formal complaint and said words to the effect that it was probably her and that she had been having a lot of personal problems, Mr Hall agreed that he kept in mind that this might not be a valid complaint in any event.

117 According to Mr Hall's notes, Ms Delf said that there had been a workplace dispute and a general clearing of the air by all parties. She did not inform Mr Hall and Mr Williams in this meeting about the matters raised in the dispute and did not mention anything about claiming for FOE. Mr Hall had not asked any details about that dispute at the time because he did not think it was relevant.

118 The meeting had been called because Ms Delf had told Mr Williams that she was considering resigning because of sexual harassment. Following the discussion, however, Mr Hall said that there was no basis for such a complaint and therefore no action was considered or taken.

119 Mr Hall confirmed that the initial discussion with Ms Delf dealt with the heated discussion in July 1999. Mr Hall took the workplace issue to be something different from the harassment or the alleged sexual harassment allegation and he remained of that view. He had not enquired into the subject matter of the workplace dispute, saying that was a task for the Branch Manager.

120 Mr Hall's notes of the meeting showed that Ms Delf had told Mr Hogan that she did not like the way he looked at her and that he appeared to be genuinely surprised by that comment and he had no idea what she was talking about. Ms Delf said that she stopped at that point realising that the problem was with her and not with Mr Hogan. She told the meeting that she was "very hormonal" and her personal life had been very difficult. Mr Hall said that he was trying to establish whether or not there was a basis for a complaint and all through the discussion, Ms Delf was extremely emotional, upset and confused. He said that at the end of the day it was determined that there was not a case as there was no complaint.

121 Mr Hall said that the purpose of speaking to Mr Hogan later that day was because Mr Williams had indicated to him that he had some nagging doubt about continuing Mr Hogan's employment beyond probation. Mr Hall had not made any connection between Ms Delf's story about the workplace dispute and sexual harassment and that they could be related to fraud allegations made by Mr Hogan. His interest in Mr Hogan was caused by Mr Williams' concern that he was not fitting in with the small team at the Windsor office.

122 Prior to the meeting, Mr Williams told Mr Hall that, while Mr Hogan's work performance was satisfactory in a technical sense, there was something that he could not put his finger on - he had a nagging doubt about Mr Hogan's ability to fit into the Windsor office environment. Mr Hall confirmed that his notes did not recall Mr Williams making a complaint about Mr Hogan's ability to fit in but that was something that came about after the discussion, commencing with Mr Williams' concern which he could not be clear about.

123 Mr Hall's notes also contained an entry where Ms Delf made it clear that if Mr Hogan's employment continued her allegations should not be mentioned because she believed that Mr Hogan's actions until now had not been deliberate and were unconscious acts. Mr Hall said at this stage there was absolutely no mention of terminating Mr Hogan's employment. There was going to be a discussion about his probationary period and if it was to continue past probation.

124 The decision to terminate Mr Hogan did not involve any consideration of sexual harassment matters nor of the alleged fraud and wrongful entries concerning FOE. They were considered to be quite separate matters.

125 Mr Hall said he was aware that there was a performance appraisal completed in relation to Mr Hogan but he was not sure when that took place. He understood that it was only in respect of "technical experience and skill on the job and not team work", although he was aware that team work was part of the usual appraisal. Mr Hall was not aware that Mr Williams had attached a note to the appraisal form thanking Mr Hogan for his good work and saying that "we're all working in well".

126 Mr Hall accepted that Mr Williams' feeling that something was going on in the office and Mr Hogan's complaint that he was being pressured to claim placement fees when they were not payable could have been part of Mr Hogan's problem of fitting in. When asked whether that matter formed any part of his assessment of Mr Hogan's suitability to continue in employment, Mr Hall said he acted on the view of managers managing their branches and would heavily rely on their opinion. He was in a position where a manager had said to him there was something about Mr Hogan that concerned him and the employee was coming very rapidly to the end of the probationary period: his concern was that if the respondent confirmed the employment and it subsequently turned out to be a bad choice then they faced a whole range of other concerns and other problems. Mr Hall accepted that it formed no part of his consideration about Mr Hogan's lack of being a team player that he was complaining about the pressure being put on him to make unjustified claims for placement fees. He also accepted that the decision to terminate Mr Hogan was a joint decision taken by Mr Williams and himself.

127 The fraud allegations raised by Mr Hogan were treated by Mr Hall as a completely separate matter. He did not consider any connection between those allegations and Mr Hogan not fitting in with the office because the office was the worst performing branch in the metropolitan area and he "never countenanced that there would be fraud going on". At the time, Mr Hall said he was more concerned with what Mr Williams was telling him about why he felt Mr Hogan did not fit in with the team environment. The fraud allegations he believed to be "unlikely" - "I just thought it was not likely to be the case". In later cross-examination, Mr Hall again stressed that while office pressure to make unjustified placement claims may have provided an explanation for Mr Hogan's inability to fit it, he was more focussed on the need for flexibility and team work and coming in on days when people were going to be away. He had also had an indication from Ms Delf that the air had been cleared about "anything else that had been discussed between them in the past anyway": it was the ability to fit in and be a team player which was the essential issue. 128 Although Mr Hall never believed that there was any fraud, he was going to investigate it and accepted that he told Mr Hogan that if his claims were true then he and Mr Williams would be the only people working in the office. When asked how he could make that statement to Mr Hogan about continuing his employment when he was considering terminating the probation period, Mr Hall merely reiterated that the fraud allegations had no connection with the ultimate decision. He firmly believed that they were without foundation and although he would investigate them he thought that Mr Hogan had raised the issue possibly to save himself from dismissal.

129 When asked to give an example of Mr Hogan's inability to fit in, Mr Hall again recalled what he understood to be Mr Hogan's refusal to attend the office for personal reasons connected with his son's sports day when the office was undermanned. He accepted that he did not discuss that issue with Mr Hogan in the interviews.

130 Before dismissing Mr Hogan, Mr Hall had not spoken to Ms Delf or Mr Hampton about the allegations of claiming placement fees for FOE - he had been told by financial officers to discuss the allegations with no one. It did not occur to Mr Hall that if there was some substance in his allegations, terminating Mr Hogan in the circumstances would have been unfair to him. It had possibly occurred to him that the workplace dispute between Mr Hogan and Ms Delf may have been about the claiming of placement fees but Mr Hall did not see that as providing any support for Mr Hogan's allegations.

131 In Mr Hall's view, the decision to terminate related to Mr Hogan's inability to fit into a small environment - it was not about sexual harassment or about fraudulent claims. The discussion took place on 11 August 1999, and by 15 August 1999 he was to be made permanent if some other decision was not made. If there was any doubt in their minds, and there was support from the Manager saying he had reservations, it was better, in Mr Hall's view, to terminate the employment during the probationary period to save the respondent more difficult problems to deal with later on if Mr Hogan became permanent.

132 It did not matter to Mr Hall whether the allegations made by Mr Hogan were correct or not - the issue remained that the concern of Mr Williams about Mr Hogan's technical ability and his ability to work in a small team environment was still present.

133 Mr Hall did not recall any discussion with Mr Hogan about his ability to fit into a small team at the meeting held on 11 August 1999. He denied that this meeting was really about the problems arising between Ms Delf and Mr Hogan. There had been discussion about his desire to leave and an attempt to find out what the problem was.

134 Mr Hall said that he never envisaged that the allegations would be found to be true but, even if they were, Mr Hogan's inability to work in a small office environment was not going to be changed - that was the real issue. Mr Hall did accept that, if the allegations were true, and as he said, the people responsible were removed from that office, the issue of fitting in with those people would not arise. Mr Hall, however, did not believe it mattered who was there, the characteristics of lack of flexibility may still arise with Mr Hogan but he did not know.

135 Mr Hall again stressed that not for one moment did he consider that there was fraud taking place at the office and dismissed the idea that he might have investigated the cause of the dispute between the staff, even if it was not fraud and merely arising from a misunderstanding. Mr Hall justified this approach on the basis that Ms Delf had told him that the dispute had been resolved and he was satisfied that there was no issue of sexual harassment. Mr Hall, nevertheless, accepted that he had not at any stage enquired about the subject matter of the dispute and also accepted that it played no role in his decision making process when deciding to terminate Mr Hogan.

136 The General Manager, Human Resources Strategy, for the respondent was Mr Foster. On or about 9 August 1999, he was contacted and informed that a problem had arisen with Mr Hogan from the Windsor office of the respondent. Mr Hogan was said to be not fitting in and there was friction between him and the senior employment services consultant. Mr Hogan was coming to the end of his probationary period and discussions were being held about whether or not to retain him. He had made allegations of fraud in the office during discussions regarding his performance.

137 Having received this information, Mr Foster spoke by telephone to Mr Hall and Mr Williams. They told him that there were concerns about Mr Hogan's performance before he raised the issue of fraud. The particular problem was his ability to work as part of a team, a feature of significance in the context of the Windsor office given its size. In his affidavit, Mr Foster stated: I was satisfied that their views of his poor performance were separate from the issues of fraud. Mr Foster was also told that the allegations of fraud arose only when Mr Hogan was informed of the possibility of his employment being terminated. Mr Williams and Mr Hall also advised him that one case of alleged fraud provided by Mr Hogan did indicate "processing errors" but there was no apparent evidence of any systematic or deliberate fraud in the system's records.

138 Mr Foster accepted the views expressed by Mr Hall and Mr Williams and authorised the termination of Mr Hogan. He also gave directions for an investigation by internal audit in relation to the allegations raised by Mr Hogan of fraud in the Windsor office. Mr Foster stated that his own investigations uncovered no evidence of fraud in the Windsor office.

139 In cross-examination, Mr Foster said he became aware that there were issues of sexual harassment but he was not certain that they were raised with him on the day that he spoke on the telephone to Mr Williams and Mr Hall. He formed the view from the discussion with them that they had clearly discussed the issues with staff members at the workplace. There were tensions and concerns, there were difficulties within the team and it was "disrupting work within the team". Considering that it was probationary employment, Mr Foster was satisfied, on the basis of what had been said to him by two senior managers, that termination was warranted. Mr Foster made a point of saying that he saw the issue of the allegation of fraud as being quite separate and wanted the letter of termination to clearly indicate that that matter would be investigated.

140 Mr Foster knew the staff at the Windsor office and was aware that Ms Delf and Mr Hampton were experienced officers who had transferred from the Public Service; he knew the quality of the staff and he was aware that there were no previous difficulties at the office. It was from a "team perspective" that these things had arisen since Mr Hogan had joined the small group.

141 Because termination of employment was a very serious step, Mr Foster stated that the decision was not taken lightly and all the options had to be considered. He thought two things were important. First, there was apparent evidence that Mr Hogan was not meeting the sort of expected performance, team performance, in terms of co-operation and working collaboratively or co-operatively with other members of the team. The second issue was the allegation of fraud. This was discussed at length with Mr Hall. Mr Hall assured him that the matter had not been raised prior to the meeting with Mr Hogan to discuss his employment and Mr Foster wanted to be sure of that fact. That was important to him in his assessment. It was also important that Mr Williams had not been told of this allegation before the meeting with Mr Hogan about his employment. It was in those circumstances that he saw the allegation of fraud as being "quite separate". There was a general discussion between Mr Foster and Mr Hall while a decision was being made in relation to Mr Hogan's performance while on probation. It was in this context that Mr Foster stated: …and should subsequently the fact be found that there was fraud being undertaken within the branch, I would then be in a position to be able to revisit that decision and quite clearly it is within my power to reinstate Mr Hogan with pay, should there at some stage, as a result of fraudulent activity be found there was some sort of conspiracy involved in that. But there was no evidence of that, so I took them both as quite separate, but yes, consideration was given that should any subsequent investigation - then I could revisit the decision in relation to the termination of his probationary period.

142 Mr Foster recalled that he made an enquiry and was told that a performance assessment had been made of Mr Hogan and that he was found to be technically competent to do the job. Mr Foster then stated: I obviously asked the question about the team issues because they were the ones that were in question and clearly they had not, as I understand, been taken into account in that review. Mr Foster was not aware that such an assessment had been performed in relation to teamwork or that Mr Williams had written a note expressing satisfaction with the fact that Mr Hogan was working in well in the office, when he approved of the decision to terminate Mr Hogan's employment.

143 Mr Foster said that, during the conversation he had with Mr Williams, there were indications that there had been "considerable disharmony in recent times" in the Windsor office. Mr Foster repeated that he saw the issue of disharmony in the office and the allegations of fraud as being separate - he had no evidence of a connection. He could take the action of terminating Mr Hogan based on the information provided to him by both Mr Williams and Mr Hall: I took that decision knowing that I could, in a subsequent time, revisit it for the purpose of saying that, if something had come out of an investigation in relation to the allegations that Mr Hogan made that would ask me to question that issue, I was in the position to revisit it, number one, and number two, I was in the position to correct it.

144 Mr Foster had asked what was the nature of the allegation of fraud made by Mr Hogan and, on being informed that it related to placement fees, he directed a review of computer entries in the office after being told that Mr Hogan had produced, as evidence, one irregular entry. He did not consider the one entry as evidence of fraud because there were many incidences of incorrect processing. He gave no consideration to moving Mr Hogan from that office to another office while he investigated the allegations of fraud. He did not take this approach because it was early days in the company's processing and there were considerable error rates being experienced and one incorrect entry did not appear to be significant. In addition: … quite clearly in my mind this was during Mr Hogan's probationary period and quite clearly the period for me to act then was within that period and it was only a matter of days before that was to conclude. I considered it more appropriate to terminate Mr Hogan. I did not believe that there was a connection and I did not believe that there was any significant fraud. Another reason for not moving Mr Hogan to another office as an option was Mr Foster's view that there was "very clear evidence of disharmony in the office, quite strong and clearly emanating from a whole group of people in the office". This had been told to him by Mr Hall and Mr Williams, both senior managers whom he respected. Mr Foster had satisfied himself that there was no fraud because there was no individual benefit to the operators. He accepted that there was a capacity for a 5 per cent bonus payable on performance but that was a separate matter. Before authorising the termination of Mr Hogan, Mr Foster did not interview Ms Delf or Mr Hampton or make arrangements for them to be interviewed about the allegations of fraud. Mr Foster was unaware that the audit report found evidence to support the allegations but insufficient evidence to recommend charges being referred to the Director of Public Prosecutions. Mr Foster said he had sufficient evidence in terms of the disharmony, "the arguments that were occurring, the arguments, the upsets that were going on", to justify the decision to terminate.

145 Mr Foster accepted that he would not normally be involved in discussions regarding whether or not a probationary employee should be terminated and that it was the issue of alleged fraud together with the proposed termination which led to his involvement.

146 In relation to the AWA used by the respondent, Mr Foster said they were in a similar form throughout the respondent: there were some, but very few, variations to the document.

147 Ms Sharleen-Anne Edwards was a receptionist of the respondent at its Windsor office. She was in that position from the commencement of Mr Hogan's employment until 5 July 1999, when she proceeded on maternity leave. Much of her affidavit evidence raised issues which were not pressed or otherwise not allowed. It was her observation on several occasions that Ms Delf had to repeatedly ask Mr Hogan to do something because he was reluctant to observe her instructions. In her oral evidence, Ms Edwards said that despite the fact that it was a small, cramped office, she had not overheard any particular conversations involving Mr Hogan. She did hear Ms Delf asking Mr Hogan to perform tasks and him replying that he would, but she did not know whether he performed them or not. She said that because she was heavily pregnant and because of the cramped conditions of the office, Mr Hogan often brushed against her when passing in the office. She thought Mr Hogan had a tendency to invade her personal space and when that happened she did not like it and would just take a step back. She said she was a good friend of Ms Delf.

148 Ms Mallett was employed by the respondent as the personnel services manager at all relevant times. She recalls that on 10 August 1999 she was telephoned by Mr Hall, who told her that there had been an allegation of sexual harassment made by Ms Delf. He informed Ms Mallett that a meeting had been arranged with Ms Delf to obtain more information on the allegation.

149 On 11 August 1999, Mr Hall and Mr Williams spoke to Ms Mallett on the telephone. They told her that the allegations of sexual harassment concerned Mr Hogan but that Ms Delf did not want to take the matter further. Mr Hall and Mr Williams also indicated that they had just completed a meeting with Mr Hogan regarding his performance and behaviour in the office. Mr Williams had indicated his concern at Mr Hogan's suitability for continued employment beyond his probationary period and also spoke of a discussion with Mr Hogan regarding "issues and tensions in the Windsor office". During the discussion, Mr Hogan had raised improper practices in the Windsor office and staff members fraudulently claiming payments from the Federal Government.

150 Later, on 11 August 1999, Mr Williams telephoned Ms Mallett and told her that he intended terminating the applicant's employment. She recalls Mr Williams saying: Given the problems which he (the applicant) had been experiencing in the office in the last two weeks, I don't think he is a good team player and I don't believe that he would fit into the small office environment of the Windsor office. I want to terminate his employment under the probationary provisions of his employment. Later, she was informed by Mr Williams that the managing director had given clearance to terminate Mr Hogan's employment. Ms Mallett had informed her immediate supervisor, Mr Foster, about these developments.

151 Mr Solomon was a chartered accountant and an associate director in the Management Assurance Services Division of KPMG and had been the auditor of the respondent since 1998. In August 1999, he was contacted by a Ms Lever, the then Company Secretary of the respondent, regarding allegations of fraud made by an employee in the Windsor office, and was requested to investigate the allegations. Mr Solomon was able to gather data indicating the number of relevant claims made and had prepared a status report by late August 1999. At the same time, he received instructions to cease his investigation. Mr Solomon stated that the date that his investigation was stopped, his findings were inconclusive. In a document which originated out of a discussion between representatives of KPMG, Mr Solomon noted that the benefit to an Employment National staff member in placing an individual was that: (a) they received performance pay of 5 per cent per annum if their levels were met; and (b) suitable performance resulted in maintaining their job.

152 During the period of Mr Hogan's employment, Ms Lever was the company secretary of the respondent. She said that, in January 1999, the respondent had been advised by the Department of Employment and Workplace Relations and Small Business that it was no longer entitled to claim a job matching fee in relation to Flex 1 candidates who found their own employment. There were, however, other fees payable in relation to Flex 3 candidates who received ongoing support. In or about late August 1999, she became aware of allegations by Mr Hogan that employees of the respondent were fraudulently claiming placement fees in relation to FOE. Ms Lever commissioned the respondent's internal auditors, KPMG, to investigate the allegations. By late August 1999, the Department itself had commenced an investigation of the allegations made by Mr Hogan. She also became aware from Mr Solomon that the Department had requested that he not proceed with a questionnaire of clients as part of KPMG's investigations. In cross-examination, it became clear that Ms Lever had left the employment of the respondent before the results of the investigation were made known.

153 In relation to the Department's policy regarding the fees which were available, Ms Lever said that the policies were distributed amongst the respondent's officers by use of an intranet site and the information could be obtained from senior management of the various job providers. When the change to claiming fees became operative in January 1999, people were trained in that new system through the provision of information on the intranet and there would also be regular regional manager meetings, regular business centre meetings and the Operations General Manager would send emails on any change of policy and this too was reinforced on the respondent's intranet. Ms Lever said that, whenever there was a change in any of the policies, it was distributed to the staff that had to implement those policies. There was also the Employment National Manual and Member Information Guide for network members, and KPMG, as part of its internal auditing procedures, went to various sites to ensure policies were being implemented.

154 In late September 1999, Ms Lever became aware of a proposal to set up a fraud line for employees who wanted to bring matters to the attention of management. Ms Lever said that proposal, in her view, was not a direct result of the allegations made by Mr Hogan although it was close in time to the allegations he raised. In her view, it was part of the ongoing risk management and internal management procedures adopted by the respondent.

155 A departmental report on the investigation of Mr Hogan's allegations was in evidence. The Report identified 37 over payments from the Windsor office arising from wrongful claims for FOE placements and noted that an amount of $5,544 had been recovered from the respondent. The Report canvassed the various options for criminal charges and, whilst evidence had been found to support the allegations, the officer responsible for the Report formed the view that sufficient evidence was not available to recommend charges to the Director of Public Prosecutions. There were other matters of some interest in the Report. It was noted that, when departmental investigators interviewed employees of the respondent, it was a condition of the interview that Ms Lever also be present. This was identified as unjustified preferential treatment which should not be continued in the future. In considering what benefit might flow to the employees who were allegedly involved, it was noted that there were bonuses available generally for performance by meeting revenue targets. This in turn might ensure continuing employment. In the interview with Ms Delf, she admitted to investigators that, prior to January 1999, she had claimed some FOE but had not continued the practice after that date. Mr Hampton in his interview stated that the entries he made in his computer were never considered by him to result in a claim for the payment of a placement fee. The investigator also noticed some hostility to the investigation of Mr Hogan's allegations.

156 On 12 August 1999, the day following his termination, Mr Hogan wrote to the General Manager of the respondent and sent copies to the Opposition Leader, the Employment Services Minister, the Shadow Minister for Employment, Training and Population, his local Member, the Member for Greenway and to the Prime Minister. In this letter, he advised of the circumstances of the Windsor office of the respondent where he alleged fraudulent activities had been undertaken. He explained the claiming of placement fees for FOE and noted that those fees were currently $180 plus a $100 bonus for each placed client. In the course of explaining circumstances of this alleged fraud and the termination of his employment, Mr Hogan stated in the letter as follows: I was advised by staff members, that this was how we needed to operate to obtain the necessary placement statistics and obtain the required Government revenue. The senior employment consultant stated that this was a widespread practice across Employment National offices (no proof). I objected to this activity, both morally and professionally, as both the Employment National Manual and the Member Information Guide (MIG) for job network members state, that in the circumstances of a candidate (in an activity agreement receiving intensive assistance - Flex 3) obtaining employment through their own effort, a vacancy should be raised as a FOE placement, which does not create a placement statistic and no claim for a Government placement fee, but does create the opportunity for the job network member to claim 13 and 26 week outcomes against the candidate. I informed my Business Centre Manager (Steve Williams) and the Regional Manager (Bob Hall) on Wednesday, August 11, 1999 of these activities. They requested proof. I provided three examples (hard copies) and advised them there was a number more. This action took place between 10.30 am and 12.00 noon. At 4.45 pm I was advised by my Business Centre Manager (Steve Williams) that my services would not be required after Friday, August 13, 1998. I intend to seek legal advice with regards to my dismissal, but more importantly I believe my accusations regarding the fraudulent activities taking place need to be aired and investigated in a public arena.

DELIBERATION 157 I have spent considerable time canvassing the detail of the evidence because, in relation to what appears to be a simple issue, much evidence was called and the cross-examination was extensive. To a significant degree, the capacity of the applicant to succeed in this case, not surprisingly, turns upon the accuracy of the account he gives of the various discussions and exchanges and, in my view, not the least in relation to exchanges and conversations with Ms Delf. Judging the evidence overall, the general nature of matters raised by the applicant as occurring do not appear to be called into question, and, putting aside the inability of any witness to be absolutely precise about all the occurrences (including dates), by and large the totality of the evidence supports what the applicant stated in his affidavit evidence and in his oral evidence. The one issue of critical importance is the subject matter of the argument which took place on 28 July 1999. Mr Hogan's version is that this argument developed because he felt he was being pressured into making claims for placement fees in relation to persons who had found their own employment (FOE) when the respondent's arrangement with the Federal Government was that such fees could not be claimed. The applicant said that he could not professionally nor morally make such claims, and that led him to discuss his situation with his wife on the night that the argument took place and, with her assistance, resolving that the best course for him was to look for other employment and to stay on with the respondent only for so long as it took him to find other employment. The only part of this account not unequivocally embraced by Ms Delf is the applicant's contention that the argument blew up over claiming placement fees for FOE. In my view, Ms Delf's evidence on this matter was both confusing and contradictory. On the analysis of that evidence which follows and considering the demeanour of the witnesses whilst giving their evidence, I have come to the view that I should accept the applicant's evidence on this matter where it conflicts with that of Ms Delf.

158 Before entering upon the analysis of the evidence, particularly relating to the extent to which placement fees for FOE formed part of the heated dispute which took place on 28 July 1999, it is appropriate to pose this question: What occurred in the last three weeks of the applicant's employment which resulted in him being found not suited for the employment and not a team player suitable for a small office such as the Windsor office of the respondent when, on 21 July 1999, the Office Manager had assessed him as fulfilling the requirements of the position in every way, including inter-personal and team skills? It seems inconceivable that in a small office - the confines of which featured in just about every witness' evidence - Mr Williams, as Office Manager, over a period of more than two months managed to miss the following matters: the fact that the applicant intimidated office staff by invading their personal space, making them feel uncomfortable; that the applicant made frequent, inappropriate sexual references; that the applicant, apparently while invading the personal space and intimidating Ms Delf, constantly stared at her bustline and made her feel uncomfortable; the applicant adopted personal behaviour, including the use of the office toilet, which was offensive to the staff. The further question might be asked: How did this experienced Office Manager miss these occurrences which had to be so obvious and which had to occur under his very nose? After analysing all of the evidence there is no creditable answer to these questions which is supportive of the respondent's case. 159 Ms Delf told the investigators that she had made placement claims for FOE before 1 January 1999 (when the system was changed so that such claims could no longer be made) - but had made no such claims after that date. When it was brought to her attention that she had made placement claims after that date, including placement claims made in August, which was shortly after the heated discussion with Mr Hogan, she suggested that those claims were made as a result of human error on her behalf.

160 Ms Delf's affidavit evidence made no reference to the fact that the wrongful claiming of placement fees for FOE was the subject or a subject raised during the heated argument which occurred in the Windsor office on 28 July 1999. On her affidavit account of the heated discussion, it was Mr Hogan who had raised an issue about following up candidates who had found their own employment when, apparently, he thought that it was nothing to do with the office. According to Ms Delf's affidavit, it was this issue that caused the argument to explode and cause her to intervene to explain why it was appropriate for those people to be contacted by the office. In her evidence, Ms Delf said she knew little about placement fees being claimed and was not aware that claims were made. This statement does not sit well with her knowledge of the system as demonstrated by the evidence and the claims that she generated as told to the investigators.

161 In cross-examination, it was put to her that the dispute with Mr Hogan was about the wrongful claiming of placement fees for FOE. Ms Delf said she was not involved "in that side of the dispute", but then accepted that she understood Mr Hogan was saying the office was not entitled to a fee for the placement of an FOE. She then, immediately after that statement, said in evidence that the first she knew of these allegations was when it was in the newspapers. When pressed again to accept that Mr Hogan was arguing that a placement fee could not be claimed, Ms Delf then stated that, in fact, the argument was about a job seeker who obtained her own employment and was being contacted, with Mr Hogan raising privacy issues. Ms Delf went on to say that the argument was not about placement fees but was about one person and the issue of privacy in approaching them about finding their own employment.

162 In evidence, Ms Delf recalled that the heated debate was about a named female who had found employment with a bag store. When speaking to the investigators, she told them that the argument arose about another named person and the tools provided and how they might be treated within the system. Finally, in cross-examination, Ms Delf accepted that, in part, the argument was about placement fees and she described how she activated the system for the payment of the fee and then de-activated the system, sometimes days later, to avoid the fee being paid. She said this was the problem with the system which was cumbersome and difficult to use.

163 The other participant in the argument (apart from the applicant) was Mr Hampton. He appeared to be quite specific in his affidavit evidence but vague in his oral evidence. In his affidavit, Mr Hampton stated that he was unaware of any complaint made by Mr Hogan about fraud in the Windsor office while he was employed there. In oral evidence, Mr Hampton could not recall the precise details of the heated discussion but knew it related to the registering of FOE cases on the system. He had told the investigator that the argument related to whether or not the office should contact an employer after being notified that an employee had obtained their own employment. Mr Hampton said he was aware that the argument related to registering FOE but he could recall the details. On further cross-examination in relation to answers he had given to the investigators, Mr Hampton accepted that placement fees for FOE had been part of the argument. He could not remember, during the argument, saying that, if Mr Hogan did not claim the placement fee, then he would. This evidence, vague as it is, at least serves to confirm that placement fees were indeed part of the heated discussion which took place on 28 July 1999. It is difficult to comprehend why there would be a heated discussion about privacy issues or enquiring of employees in relation to the employment that they had found. The argument that has variously been described as "heated" and "ugly, very ugly" is more likely to have reached this level in a debate about claiming the placement fees - it tends to support Mr Hogan's evidence that he was refusing to claim such fees and was meeting opposition to that course from Ms Delf and Mr Hampton.

164 Ms Delf said the procedure that she and Mr Hampton used was different in recording placement fees for FOE but, in fact, achieved the same result as the approved practice. She said that she was aware that the procedures for FOE had changed. When asked in cross-examination why she had not resolved the argument with Mr Hogan by immediately checking the manuals or the intranet for the correct method, Ms Delf stated that the manuals were not up to date and it had not otherwise occurred to her. In another part of her cross-examination, Ms Delf said that Mr Williams had told her how to process the FOE after the heated argument and stated that the way they were to be done had apparently not filtered down to her yet. That statement contradicts what she had told the investigators - namely, that she knew the system had changed in January 1999 and she had not claimed placement fees for FOE since that date. The company secretary, Ms Lever, said that policies were distributed amongst the respondent's offices by use of an intranet site and that information could be obtained from senior management. The change to claiming fees for FOE became operative in January 1999 and people were trained in that new system through information on the intranet. There were also regular Regional Manager meetings, regular Business Centre meetings and the Operational General Manager sent emails on any change of policy. Changes in policy were distributed to the staff who had to implement those policies. The Employment National Manual and Member Information Guide for network members contained this information and KPMG, as part of the internal auditing procedures, attended at various sites to ensure that policies were being implemented. This evidence was called on behalf of the respondent and it is difficult in those circumstances to accept, quite apart from Ms Delf's own evidence as to the state of her knowledge, that at the time of the heated argument with Mr Hogan in July 1999, she did not know and understand the change in policy and the prohibition on claiming placement fees for FOE. It also casts doubt on the acceptability of her evidence on this matter that she has seen fit to give a number of versions of not only the content of the debate but the state of her knowledge about the correct policy for placement fees. It is also significant that neither Ms Delf nor Mr Williams contradicted or questioned Mr Hogan's affidavit evidence that: (a) he was initially shown the method of claiming placement fees for FOE by Ms Delf in early July; (b) on or about 26 July 1999, Mr Hogan told Mr Williams that he was going to claim a placement fee for an FOE (as shown to him by Ms Delf) and was instructed by Mr Williams that the fee was not available and was shown the proper way to process the FOE information. In terms, this evidence was not denied. Further, Mr Hogan said that he checked the instruction given by Mr Williams against the Respondents' computer manual and satisfied himself that the process was correct. Mr Williams' evidence was that this process was frequently discussed in staff meetings. Ms Delf's suggestion that the manual and intranet information on FOE was out of date at the time is simply insupportable. When confronted with the essence of this information in cross-examination, Ms Delf withdrew to the position that during the heated argument she was "just guessing" about the process because the system was so difficult to operate.

165 Another contradiction in Ms Delf's evidence is that, while on the one hand she claimed that the heated dispute was not, or was not essentially about claiming placement fees for FOE, she also gave evidence that she agreed with Mr Hogan at the end of the debate that she would confirm with Mr Williams what was the proper procedure for FOE. Again, if this was not an issue, there was no reason for the FOE procedure to be checked by Ms Delf. Importantly, Mr Williams in his evidence did not confirm that this matter was clarified or in any way raised with him by Ms Delf. In her evidence, Ms Delf could not say precisely when she did clarify the FOE procedure with Mr Williams. In cross-examination, Ms Delf said she raised the proper procedure with Mr Williams the next day and he explained the way in which FOE were to be processed. If it was not raised the following day, she raised it at a regular lunch meeting but at the time she did not mention it was the subject of a heated dispute or row in the office. All she did was to get the information from Mr Williams. It is apparent from this answer that Ms Delf was unlikely to be raising issues of privacy and approaching clients who had found their own employment and it again tends to confirm that the issue was whether or not the placement fee was claimable. Further, besides Mr Williams not mentioning this clarification being sought by Ms Delf anywhere in his evidence, he confirmed that when Ms Delf was called to the meeting with himself and Mr Hall on 10 August 1999, Ms Delf spoke of the heated argument but at no stage disclosed the specifics of that argument. In fact, Mr Williams denied that Ms Delf had ever raised with him anything about a row concerning FOE claims: he confirmed in his evidence how these matters were to be handled and that it had been talked about in the office frequently. Apart from repeating, during her cross-examination, that she was unable to recall the words she used when she says she checked the process for FOE with Mr Williams, Ms Delf later in cross-examination again asserted that she raised the issue of placement fees with Mr Williams and confirmed that he wanted them recorded the way he had told Mr Hogan to record them. That answer appears to be consistent with Mr Hogan's version of the dispute being one concerned with placement fees not being claimable in relation to FOE.

166 Ms Delf stated that, when Mr Hogan met with her the day after the heated dispute in the office, she accepted his explanations and they agreed to try to let things work themselves out. Specifically, they agreed that the dispute was over and she asked Mr Hogan not to seek a reference from Mr Williams but to see how things developed over the next few weeks. She sought Mr Hogan's agreement that Mr Williams not be told about the argument. This seems to be a strange request from the second most senior person in the office considering the nature and intensity of the discussion during the argument. There does not seem to be any appropriate reason why Ms Delf should not have informed Mr Williams of the incident even if she had satisfied herself that the matter had been resolved - the resolution of the matter to her satisfaction may have provided an even stronger reason for informing Mr Williams about what had occurred. Perhaps more importantly, in cross-examination, Ms Delf accepted that she said to Mr Hogan words to the effect that if Mr Hogan sought a reference from Mr Williams, Mr Williams could become quite "suspicious". Ms Delf was not able to explain what she meant by the use of the word "suspicious" but suggested another context which made no sense at all. The use of the word "suspicious" and the subject of the dispute as identified by Mr Hogan suggests that Ms Delf did not want Mr Williams to know that there was a dispute within the office about claiming placement fees for FOE. The likelihood of this context is again confirmed by the fact that Mr Williams denied that he was told anything about a row over FOE and FOE procedures. Even on Ms Delf's account of her conversation with Mr Williams (which he does not confirm), she asked for a clarification of the procedure but did not tell him that there was an office row over it. Nor did she inform Mr Williams that Mr Hogan was considering resignation - she thought this was a matter between Mr Hogan and Mr Williams, but Mr Williams was blissfully unaware of it. Ms Delf's inability to adequately explain why she did not raise these matters with Mr Williams provides a further reason for treating contested aspects of her evidence with extreme caution.

167 There are other confusing and contradictory aspects of Ms Delf's evidence, highlighted by those parts of her evidence where she accepts that at least part of the heated dispute concerned whether or not placement fees could be claimed in relation to FOE, but then categorising the argument as being over a minor issue and trivial and one which could be worked through. It was not important enough to approach Mr Williams about, she said, but by 6 August 1999, Ms Delf was telling Mr Williams that there was a heated argument which was very personal and she had felt intimated by Mr Hogan. By 10 August 1999, in the meeting with Mr Williams and Mr Hall, Ms Delf was describing the heated argument as being "ugly, very ugly". These descriptions do not fit easily with Ms Delf's other evidence: that the argument involved merely a clearing of the air and involved issues which had been resolved to her satisfaction; that the meeting the day after the argument with Mr Hogan was "very pleasant" and the dispute was "all over".

168 Ms Delf said she was happy with Mr Hogan's explanations given to her in the meeting which took place on the day after the argument but, by 6 August 1999, she was telling Mr Williams that Mr Hogan was making no real attempt to fit in. Just a week earlier they had resolved their differences. When this was drawn to Ms Delf's attention she again dissembled. She said there were two different things being discussed: she accepted they had resolved the issues which arose in the argument but she continued to have difficulties in the "bigger context". She continued with the view that Mr Hogan should not resign over the argument because it was trivial but she failed to tell him that he should resign because of other issues, including sexual harassment. Her explanation for not raising those matters in the discussion with Mr Hogan was that it was simply not the way the conversation flowed. She said she did not know if Mr Hogan could change but failed to specify what it was he had to change. She accepted that she never raised with Mr Hogan that he was staring at her bustline.

169 The discussion between Ms Delf and Mr Williams on 6 August 1999 assumed some importance, given that Ms Delf considered that the argument that had taken place a week before had been resolved and she was happy with Mr Hogan's explanation. In this meeting, however, she told Mr Williams that there was a heated argument which was very personal, that there had been an argument about the procedure for recording FOE and that she had been intimidated by Mr Hogan. She said that his behaviour was inappropriate, he was making inappropriate comments, was staring at her bustline and making no attempt to fit in. Nevertheless, she did not want to make "a big deal about it" and felt that she had "got through" to Mr Hogan. For a person who did not want to make a big deal about it, Ms Delf was certainly placing Mr Hogan under scrutiny with the Office Manager in the vital period leading up to the expiration of his probationary period.

170 What occurred next is also not without significance. On the afternoon of 9 August 1999, Ms Delf was required to leave the office urgently to attend to her sick daughter. In the small, cramped office she came across Mr Hogan on the floor repairing a chair. Mr Hampton recalls this incident as Mr Hogan making no effort to get out of her way but he does not recall Ms Delf asking Mr Hogan to allow her to pass. In her affidavit evidence, Ms Delf talks about being uncomfortable as she moved past Mr Hogan because he was looking inappropriately at her. In her affidavit, she makes no mention of feeling Mr Hogan's breath on her legs as she passed by. Nor does she appear to mention this aspect when she later called Mr Williams, complaining of, amongst other things, sexual harassment and announcing her intention to resign. Mr Hall's affidavit recalls nothing of Ms Delf complaining about this breathing incident in the discussion he had with her on 10 August 1999. Indeed, it is only in oral evidence that Ms Delf raises feeling Mr Hogan's breath on her legs and stating that is when she decided to resign. It is curious that this action, which so offended Ms Delf as to cause her to tender her resignation, is not fully detailed by Ms Delf until her oral evidence. There is nothing in Mr Hampton's evidence which suggests that Mr Hogan was so close to Ms Delf when she passed that it was inappropriate behaviour by Mr Hogan, nor is there any suggestion that Mr Hogan was looking inappropriately at Ms Delf during this incident. As Ms Delf later explained, she held the perception that Mr Hogan was looking at her body and she had that perception whether he was doing so or not. Importantly, Mr Hampton was not aware of the sexual harassment of Ms Delf until some time after Mr Hogan's termination.

171 It is also not without its significance that this event is said to have taken place on the same day that Mr Williams informed Ms Delf that Mr Hogan had given a different version of events and that they needed to talk again. At this point it was at least possible, if not likely, that Mr Williams had been told by Mr Hogan of the argument over claiming placement fees for FOE.

172 When Ms Delf met with Mr Williams and Mr Hogan on 10 August 1999, the meeting lasted for approximately two hours. The first thing that appears to have been raised by her was the heated argument rather than the occurrences of sexual harassment. Mr Hall recalls that matter in terms of Ms Delf "also" raising her feelings about being sexually harassed by Mr Hogan: but the allegation of sexual harassment was said to be the only purpose of the meeting. There are other matters that place the sexual harassment complaint in context. Ms Delf stated that, by the time this meeting took place, she felt that the pressure was getting to her. She felt that a barrier was developing between herself and Mr Williams because she had not immediately consulted him about the workplace row, although Mr Williams never mentioned this in his evidence. Ms Delf regarded herself as being at fault when ringing Mr Williams and tendering her resignation. She explained that this action was the result of an accumulation of personal factors. She said that, in that discussion or in the discussion with Mr Williams and Mr Hall, she may have referred to herself as being hormonal but she just wanted to get out of the office. On the one hand, she believed that she was being sexually harassed by Mr Hogan. On the other hand, she thought it was her problem - it was her perception. That became evident to her when she raised with Mr Hogan his attitude and regarded his response as being one of surprise. He seemed genuine and did not know what she was talking about. It was at this point that Ms Delf said she realised that the problem was with her and not elsewhere - she was the "sore thumb". In her earlier evidence, she accepted that nothing much had happened in terms of the relationship with Mr Hogan until the heated argument on 28 July 1999. Ms Delf also accepted that a consideration of the first 13 pages of the interview with investigators revealed her only complaint about Mr Hogan to that point was about his propensity to invade a person's personal space.

173 The picture presented by Ms Delf was certainly that of a person under a great deal of emotional strain during this period of July - August 1999. In many respects, the contradictory aspects of her evidence appear to come down to the fact that she had formed a view about Mr Hogan which was adverse to him but also came to realise that the problem lay with her - it was, as she stated, the result and the effect of an accumulation of pressures both workplace and personal. Importantly, after lengthy discussion with her, these difficulties should have been more appreciated by Mr Williams and Mr Hall. It was not a sufficient response just to compartmentalise the difficulties. When the great majority of complaints about Mr Hogan's inability to work in a small office came from these discussions with Ms Delf, the circumstances should have sent a warning signal to Mr Williams and Mr Hall that it would be risky and potentially unfair to proceed on those views alone. Both Mr Williams and Mr Hall accepted that they made no further enquiry of the other office staff before terminating Mr Hogan.

174 The level of investigation and the appreciation of the issue generally appeared to exhibit deficiencies. Mr Foster thought that Mr Hogan was not meeting accepted performance levels including team performance. He thought that, although there had been a performance assessment of Mr Hogan, it had not considered the question of the team dynamics within the office. He was unaware that Mr Williams had rated Mr Hogan as performing to the required level in team work and interpersonal aspects of the position he occupied. He was unaware of Mr Williams' note, sent only a few weeks earlier, complimenting him upon his work and the fact that they were all working in well together. He made no mention, and therefore would appear to be unaware, of Ms Delf's view that Mr Hogan possessed quite good IT skills and would volunteer to do work in that area which was appreciated and accepted. Mr Foster thought there had been considerable disharmony in recent times: evidence he described as being very clear and quite strong and "clearly emanating from a whole group of people in the office". He appears not to have been informed by Mr Williams and Mr Hall that no one else other than Ms Delf within the office had been consulted on the existence of such clear and disruptive disharmony. Indeed, so subtle was this disharmony that Mr Hall recalls Mr Williams telling him that he felt that there was something wrong but he could not quite put his finger on it. Mr Hall, while aware of the performance appraisal in late July 1999, had not seen the results of the appraisal. He understood the appraisal was in respect of Mr Hogan's technical expertise and skills on the job and not his teamwork. Mr Hall was not aware of Mr Williams' note and the view expressed that they were all working in well. In the end, Mr Hall was acting upon the view of senior managers which presumably included the views of Ms Delf. None of those involved in the assessment of Mr Hogan's probationary period seemed to have been aware that: (a) Ms Delf was of the view that nothing much had occurred involving Mr Hogan before the argument late in July 1999; (b) Ms Delf thought Mr Hogan's IT skills were good and that he would co-operate in this area by volunteering to do work when others were in difficulty; (c) Mr Hampton thought that there was no real problem with Mr Hogan, that there was a fair working relationship between them and that they got on quite well; (d) Ms Edwards had little in the way of relevant information apart from some things told to her by others in the office, mainly from her "good friend", Ms Delf. Ms Edwards had left work on maternity leave on 5 July 1999, more than two weeks before Mr Williams' laudatory appraisal of Mr Hogan.

175 Mr Hall went to some lengths to emphasise that the sexual harassment complaints by Ms Delf were not considered in coming to the view that Mr Hogan's employment should be terminated. In the interview with Mr Williams and Mr Hall, Ms Delf informed them of the row which took place on 28 July 1999 but also told them that the issue had been satisfactorily resolved to the extent that it was unnecessary to raise the matter with Mr Williams. The question then arises: What was the reason for the dismissal if these matters played no role? What was it that demonstrated Mr Hogan's lack of flexibility and inability to fit in and be a team player? Mr Williams' concern appears to be that on one day Mr Hogan took leave which potentially left the office short handed. He went as far as to say in evidence that it amounted to deceitful conduct but did not explain why it was so. Mr Hogan explained that he had made the arrangement with Ms Delf as time in lieu and it was recorded in the interview book as being the most appropriate way of indicating that he would not be in the office. There is no evidence that Mr Williams checked Mr Hogan's story with Ms Delf and Ms Delf makes no mention of it in her evidence. Considering that every aspect of Mr Hogan's service which could generate a complaint was searched for and aired in the proceedings, it is extraordinary, to say the least, that his explanation was not challenged. On that basis, there can be no deceit and, at worst, there may have been a failure of communication with the office manager by both Ms Delf and Mr Hogan. As a one off event, where an explanation was proferred which was not challenged, it could hardly have justified the decision to terminate. The complaints about long cigarette breaks, the time when lunch breaks were taken and the use of the office toilet appear to have been treated, appropriately, as minor issues by Mr Williams. If they were of any importance at all, Mr Hogan was entitled to expect that they would be raised with him in his performance appraisal in late July 1999 - they were not. The conclusion available is that, despite Ms Delf informing Mr Williams and Mr Hall that the argument on 28 July 1999 had been resolved, it was that event which was the catalyst for their consideration and became the basis of their conclusion that Mr Hogan was not a team player. Indeed, Mr Williams was concerned that Ms Delf was upset and wished to resign. This conclusion raises directly an issue pleaded by the applicant, namely, that the arrangement was unfair because it required him to make claims for placement fees which were not justified. That is the issue which led to the row, it is the row that seems to have so badly affected Ms Delf and it is Ms Delf's reaction which appears to have so affected and influenced Mr Williams and Mr Hall.

176 It is appropriate at this point to recall the reasons identified by Mr Williams as inclining him towards not continuing Mr Hogan's employment. The reasons are set out in paragraph [89]. The reasons then expressed were: (a) the deceitful behaviour over the one day leave taken early in August 1999; (b) Mr Hogan's continual complaints about salary and queries about the salary of others; (c) Mr Hogan's general attitude of dissatisfaction with his employment and the fact that he was looking for other employment; and (d) Mr Williams' concern that the working relationship between Mr Hogan and Ms Delf and her allegations of sexual harassment. That was Mr Williams' thinking by the time he had the discussions with Mr Hall and they both discussed the matter with Mr Foster. The letter of dismissal, however, recorded the reason for termination in the following terms: This decision has been taken after discussion with the Regional Manager Metropolitan Sydney, Mr Bob Hall regarding your overall performance in the position. It is considered that your performance to date has not met the competencies and expectations of the position, in particular your ability to work effectively in a small team/office environment. Despite the length of the case and the amount of documentary evidence, the material to support this conclusion is extraordinarily thin. This was a case which was hard fought and one where it appeared that every conceivable skerrick of evidence which might be adverse to Mr Hogan was paraded before the Court, whether or not relevant to the proceedings. The presentation of much of this material disclosed something of an air of desperation about the respondent's case.

177 In their evidence, Mr Williams, Mr Hall and Mr Foster emphasised, and sometimes frequently did so, that their decision to terminate Mr Hogan had nothing to do with his allegations of fraud in the Windsor office. That was put to one side to be investigated but played no role in their decision making process. In fact, both Mr Hall and Mr Foster were quite clear that they thought there were no grounds for the allegation. They did not have the slightest doubt that Mr Hogan's suggestion was baseless although they accepted their obligation to investigate it. Even when Mr Hogan gave Mr Hall evidence from the computer of claims made in relation to persons who had found their own employment, this was immediately dismissed as probably due to a technical error - it was not accorded even the low level classification of grounds for considering, whether fraud was involved or not, that Mr Hogan could be correct in his complaint.

What is inexplicable is that none of these senior and experienced people contemplated that there could be a link between tension in the office and Mr Hogan's allegations that two of the four in the office who performed this work were pressuring him to make claims which he regarded as professionally and morally wrong. There is no doubt that Mr Hogan's allegations and the letter he wrote airing those allegations the day after he was terminated caused great distress to those who worked in the office. It was abundantly clear during the evidence given by these witnesses that they sorely resented the allegation of fraud and, during their cross-examination, frequently became testy and argumentative. In the circumstances of the small office and the mind set of senior officers that there could be no grounds for such a complaint and that it, in fact, may be no more than an attempt by Mr Hogan to save his job, it may well have been the issue which ultimately persuaded the decision makers to conclude that Mr Hogan should be terminated. In addition, both Mr Hall and Mr Williams were obviously concerned about Ms Delf's reaction to Mr Hogan and, even though they firmly rejected that the allegations of sexual harassment were not taken into account because there was no formal complaint, it is difficult to accept that Ms Delf's accusations had no bearing on their decision to terminate Mr Hogan.

178 The difficulty with the situation faced by these representatives (with its paucity of evidence), together with the serious allegations of fraud made by Mr Hogan and the clear personal distress of Ms Delf, led Mr Foster to adopt the extraordinary position that it was best to dismiss Mr Hogan while he was on probation because, if anything favourable turned up in the investigation, he could be reinstated. Mr Foster did not make Mr Hogan aware that he could be reinstated if the allegations were proved to any extent. Mr Foster was content to rest finally on the fact that the allegations of fraud were not proved but ignored the fact that the investigation uncovered a substantial number of unjustifed claims and required the respondent to repay over $5,000 to the Government. It did not seem to occur to anybody that the finding of such a number of irregularities (whether or not they were fraudulent), indicated that the claiming of fees was the source of even a possibly genuine disagreement which erupted in the office between Mr Hogan, Ms Delf and Mr Hampton and was the cause of office tension.

179 It is apparent from the evidence that Mr Hall and Mr Foster, and probably Mr Williams, had come to the view that it was preferable to terminate Mr Hogan during his probationary period because it was easier to do so and it could create problems if they had to dismiss him once he had been given ongoing, secure employment. What was it that caused this rush to judgement? Why was it a preferable course to dismiss him during probation than have to consider his position at a later time? The fact that these issues were raised at all suggest that either the decision makers knew that they had a very thin case for termination and certainly could not justify it once Mr Hogan moved beyond his probationary period, or, that the support for Ms Delf, (who, like the decision makers, had come through the CES), was such that they saw the most satisfactory resolution of her clear distress to be the relatively simple removal of Mr Hogan - a mere probationer.

180 There was a deal of debate about whether or not staff members and/or the Windsor office had targets which had to be met.

The idea of targets existing was resisted by the respondent and by Ms Delf. Mr Hogan's evidence was that both Ms Delf and Mr Hampton had justified claiming placement fees for an FOE because of the need to obtain revenue and meet the target set for the office. Evidence was called by the respondent to demonstrate that there were no personal or other relevant targets and presumably to thereby cast doubt on the version of conversations given by Mr Hogan. The evidence demonstrated the following: (a) there was a Windsor office target - Mr Williams gave evidence that at the time of the problems raised by Ms Delf, the office was below target and it was a concern; (b) there were frequent discussions in the office about targets - that was Mr Williams' evidence; (c) there were financial targets - that was Mr Hall's evidence; (d) there were benefits and bonus payments available to staff when targets were met or exceeded - that was the evidence of Mr Solomon and also the view expressed by the investigators. This is another example of efforts made by the respondent to detract from the reliability of Mr Hogan's evidence and where his evidence has been shown to be substantially accurate.

181 There are a host of other inconsistencies and a myriad of possible motives for what happened. I have summarised the evidence extensively and during the course of doing so drawn attention to many of the inconsistencies. I do not believe it is necessary to go any further in order to form the view that there was unfairness during the employment of the applicant resulting from the conduct of the respondent. In my view, the respondent permitted a situation to arise whereby, for Mr Hogan to work harmoniously in the Windsor office, required him to succumb to the pressure to make claims in relation to placement of FOE where those claims were not allowable under the arrangement between the respondent and the Government. The investigation, such as it was, focussed on the distress of Ms Delf and failed to adequately enquire into the cause of any perceived tension in the working team located at the Windsor office. Similarly, the termination of the applicant, while it was easy to achieve in the probationary period, was unfair when it was contemplated that there could be a possibility that his termination was not justified. I find these aspects of the applicant's case are established on the evidence.

182 A more difficult issue is the claim that the probationary period should be varied so as to provide a period of one month instead of three months. The case for the applicant is not presented on the basis of different treatment of other employees. The evidence, in fact, seems to establish that the requirement of probation and the terms of the AWA were relatively standard form requirements which were not really negotiable. Here, there were complications in the arrangements. The AWA did not require a period of probation although its terms were detailed. The AWA did refer to the policies of the respondent and it was said that the policies contemplated a period of probation. Clearly, the letter of appointment spoke of a probationary period of three months.

183 The complaint made by the applicant is that these arrangements were in a standard form, they were offered effectively on a "take it or leave it" basis and that he was in an unequal bargaining position when he entered into the employment arrangement with the respondent. Support for that proposition, at least in part, was given by Mr Foster, who accepted that there was very little by way of variation from the standard terms offered by the respondent throughout Australia. When it came to the offer of this employment on three months' probation, there does not appear to have been any consideration given to the education standards achieved by the applicant, his experience in public sector and private sector employment, his age and the nature of the position to be filled. In my view, a consideration of these matters may have led a reasonable employer treating the applicant fairly to require a probationary period of no more than one month. Allowing, however, for some caution in a new operation, a probationary period of two months was more than adequate to protect the position of the employer whilst providing fairness to the employee. Subject to later considerations, I would propose, therefore, to vary the contract from its commencement to provide: (a) a term of the contract preventing the applicant being required to make claims for placement fees in relation to persons who found their own employment unless authorised to do so; (b) a term of the contract preventing the applicant from being dismissed or otherwise disadvantaged for any reason relating to a requirement that he make claims for placement fees not justified by the arrangements between the respondent and the Federal Government; (c) a term of the contract specifying a period of probation of two months.

184 Having reached the conclusion that there was unfairness in the arrangements between the applicant and the respondent whereby the applicant was employed at the respondent's Windsor office, and having also determined to vary the contract from its commencement, it becomes necessary to consider a number of challenges to the jurisdiction of the Commission raised by the respondent. In my view, it is appropriate to consider those challenges having formulated the nature of the orders that would otherwise be made if the Court does possess the jurisdiction to give effect to those orders. 185 The respondent contended that the application was precluded by the provisions of s 109A of the Act, relying on the purpose of the section identified by the Full Court in Beahan v Bush Boake Allen Australia Ltd (1999) 47 NSWLR 648 at 692. It was submitted that, on a proper examination of the evidence relied upon by the applicant, this matter was nothing more than a complaint about the termination of Mr Hogan's employment because of issues he raised in relation to matters he said were fraudulent and pressure brought on him to participate in such fraudulent behaviour. That was the substance of the case and it could not avoid the scope of the limitation imposed by s 109A.

186 The Full Court in Beahan considered extensively the law relating to the operation of s 106 and compared it with the provisions relating to unfair dismissals in Chapter 2, Part 6 of the 1996 Act. This analysis took place in the context of a claim under s 106 to vary the contract to provide one year's notice of termination upon redundancy. The Full Court accepted that only cases which are really disguised as an unfair contract are to be prohibited. Where the claim, however, challenged the terms or operation of a contract of employment by genuine reasons related to the contract itself, it was a claim properly within s 106. In Beahan the court pointed to the fact that there was no allegation that the termination of the applicant's employment was unfair; there was no claim for reinstatement or re-employment nor was there a claim for compensation relative to an alleged unfair dismissal. The real complaint was that the contract was unfair in that it provided insufficient payment on termination. The court pointed out that an unfair dismissal was not concerned with the terms of the contract - if an application attacked the contract and sought compensation that was a claim not prohibited by s 109A.

187 The Full Court referred to Huskisson RSL Sub-Branch Ltd v Sullivan (1990) 20 NSWLR 332 and Walker v The Industrial Court of New South Wales (1994) 53 AR 121 to demonstrate that a claim made within the equivalent of s 106 under the various statutory schemes may also give rise to relief under other provisions of the Act. In Walker, Kirby P noted that it was not unusual for legal systems to provide a number of remedies for one set of circumstances. Sometimes the cases will be decided on a fine balance as to the proper categorisation of the claim (BNY Australia Ltd v James (1992) 26 NSWLR 57). What was noted, however, was that in unfair dismissal cases the remedy was for the loss of a job and was principally about the dismissal itself. For the application of s 109A, it was not enough that simply some elements of relief were common to both statutory regimes.

188 In this case, the fundamental complaint by the applicant is the way the contract operated and permitted pressure to be applied to him to make claims which were not justified under the arrangements between the respondent and the Federal Government. The bulk of the applicant's evidence and the evidence called by the respondent was directed to this issue. A variety of questions were raised: Was there in fact such pressure?; Were there in fact such claims?; Were these claims the real reason for the heated dispute which took place on 28 July 1999?; Was this conduct an operative factor in the treatment of the applicant by the respondent's representatives? Mr Hogan took his complaint about the manipulation of the system of placement fees to the General Manager of the respondent, the Prime Minister, the responsible Minister, the Opposition spokesman and his local Member. He was clearly offended by the proposition that such claims should be made in order to facilitate the respondent's business, including that of its Windsor office. Just as clearly, those involved in the heated dispute and in handling its aftermath were openly hostile to the allegations made by Mr Hogan. In a personal sense, some of the witnesses were clearly taking the opportunity during their evidence to establish that they had been guilty of no wrong doing, while others were at pains to demonstrate that they had not failed, in any sense, in applying proper business procedures in the operation of the Windsor office. This was the essential focus of the case. 189 That central focus was a reflection of the claims in the Summons for Relief. An order was sought varying the contract or arrangement between the applicant and the respondent so as to include a variety of terms, all aimed at removing as a requirement of his employment the making of claims which were either dishonest, unprofessional or unjustified. An order was sought that the contract be varied by reducing the period of probation. Variations were also sought so as to prohibit dismissal because of any failure by the applicant to engage in practices which were attacked as being dishonest or unprofessional. The fact that the pleadings referred to dismissal could not be determinative of the issues, just as the termination giving rise to the claim for a higher redundancy pay was not determinative in either of the issues in Beahan. In addition, the grounds included a complaint that the applicant was in an unequal and inferior bargaining position in his dealings with the respondent. These elements are classic examples of situations where s 106 may operate.

190 It is to be remembered, and was referred to by the Full Court in Beahan, that Sheldon J in Davies v General Transport Development Pty Ltd (1967) AR 371 at 373 - 374 pointed out that the section allows contracts to be remade by omitting parts and retaining the rest or by adding new terms: destruction, dilution, renovation and patching were all weapons in the section's arsenal. On a proper approach to the Summons for Relief and the evidence called in support of it, this is precisely the power sought to be exercised by the applicant. In all the circumstances, I am unable to accept the respondent's contention that s 109A applies to the present application.

191 A separate challenge mounted by the respondent alleged that the orders sought impinged upon s 109 of the Constitution. It was submitted that the orders sought in the summons would alter, impair or detract from the operation of Federal instruments and would destroy or vary the adjustment of industrial relations established by them.

192 The applicant had entered into an Australian Workplace Agreement (AWA). The Workplace Relations Act 1996 was said to identify the role of AWA's in regulating the relationship between employer and employee (s 170VF(1)) and provided that an AWA prevailed over conditions of employment specified in a State law to the extent of any inconsistency (s 170VR(1)).

193 The respondent submitted that the letter of appointment provided to the applicant referred to the AWA and the respondent's Personnel Policies and Procedures Manual. The Manual itself referred to a probationary period of employment. The Policies and Procedures Manual required the applicant to comply with the policies and procedures contained within it. Clause 24 of the AWA dealt with termination of employment and provided that full rights under the Workplace Relations Act 1996 were given to the applicant if the termination was harsh, unjust or unreasonable or if the employment was unlawfully terminated. Clause 26 provided a dispute resolution procedure and Clause 28 identified how the AWA could be varied or terminated.

194 The applicant was terminated and in accordance with the Manual, was provided with payment up to the date of termination plus one week's pay in lieu of notice. This was the respondent's submission.

195 It was also asserted that the employment of the applicant was covered, as an underpinning instrument, by the Employment National (Administration) Award 1999. The Employment Advocate also considered the respondent's Policies Manual when certifying the AWA. The award dealt with probation and provided: At the company's discretion, you may be employed on probation during the first three months of your employment. Your period of probation (if any) will be recorded in writing at the time of your engagement.

196 It was submitted that consistent with the award, the letter of appointment referred to a probation period and identified the express period as being "the first three months of your employment".

197 It was pointed out that the Summons for Relief sought to vary the period of probation to a period of one month as opposed to the three months specified in the letter of appointment, the Manual, the AWA and the award (sic). In this respect it was submitted that the amended summons raised both direct and indirect inconsistency with Federal instruments.

198 Reference was made to Australian Broadcasting Commission v Industrial Court of South Australia and amor (1976-1977) 138 CLR at 399 where Commonwealth legislation exclusively occupied the field such that there was no room for the operation of State law. Reference was also made to McGowan v Australian Broadcasting Corporation (2001) 104 IR 244 where the Australian Broadcasting Corporation Act covered the field of the employment of its employees to the exclusion of the operation of s 106 of the New South Wales Act. Attention was drawn to the decision in Hudson v Qantas Airways Ltd (1985) 10 IR 331 and the consequences of a Federal award being silent on certain issues and whether, in such circumstances, inconsistency under s 109 of the Constitution arose. The respondent further relied on the judgment in Burgess and ors v Mount Thorley Operations Pty Ltd [2002] NSWIRComm 106, noting that s 170VR of the Workplace Relations Act dealing with the effect of AWA's on other laws was in similar terms to s 170LZ dealing with certified agreements and s 152 of the Workplace Relations Act 1996 dealing with awards prevailing over State laws. Reliance was placed on the decision in Barry v Australian Broadcasting Corporation (2002) 112 IR 33 and the approach in Moore v Newcastle City Council; re Civic Theatre, Newcastle (1997) 77 IR 210. 199 In substance, the respondent's submissions quoted the approach adopted in the various cases cited but made little or not attempt to indicate the relevance of the approach for the purposes of the present matter. In many respects the argument proceeded on the basis that the mere existence of a Federal award and an AWA meant, at least in relation to probation and probably in relation to termination, that there was no room for the operation of s 106 of the New South Wales Act. The parties' attention was drawn to the recent judgments in Thornthwaite v Australian National Credit Union Ltd [2002] NSWIRComm 240 and Scott v Picone and ors [2002] NSWIRComm 239. Both parties were given leave, and indeed took the opportunity, to file further written submissions in relation to these judgments. 200 The respondent's further submission noted that in Thornthwaite's case the Federal instrument involved was a certified agreement and a Federal award, while in Scott's case the matter revolved around the provisions of a Federal award. It was submitted to be significant that the applicant's case raised the issue of an AWA and the personal nature of the AWA applying to the specific individual. Mr Hogan signed the AWA. It was never explained how the so called personal nature of the AWA affected the application of established principles in dealing with alleged section 109 inconsistency. If anything turns on the point, it appears to be incorrect in any event. The evidence was that the terms of the AWA were basically common to the respondent's operation. Further, the Workplace Relations Act 1996 permitted an AWA to be collectively negotiated but required it to be signed by each individual. On the evidence, there does not seem to be anything of a particular nature referrable to Mr Hogan contained within the AWA except the relevant part of the general wage rates applied to persons who performed his class of work. There was nothing in the evidence to support a conclusion that any particular part of the agreement was personal to the needs and requirements of Mr Hogan. While the AWA is approved by the Employment Advocate in most cases rather than the Commission, it is still required to meet a no disadvantage test, meaning that it must not disadvantage the employer in relation to that person's terms and conditions of employment, which usually requires a comparison with a designated or relevant award, here apparently the Employment National (Administration) Award 1999. Just like certified agreements, whilst it remains in operation, the AWA overrides any inconsistent Commonwealth award (except for a specially arbitrated award under s 170MX), as well as overriding any inconsistent certified agreement made before the AWA, where the nominal expiry date has passed. Under s 170VQ(4), during its period of operation, an AWA operates to the exclusion of any State award or State agreement that would otherwise apply to the employee's employment.

201 It was then asserted by the respondent that the AWA had been incorporated in the applicant's contract of employment. The focus was then said to be upon the orders sought and how they impinged upon the comprehensive nature of the AWA and its supporting documents. It was submitted that the orders sought by the applicant directly cut across the AWA. There also seemed to be a submission that any order made in relation to the contract of employment would cut across the AWA in that the AWA, as a Federal instrument, had become part of the contract of employment. There was a direct conflict and inconsistency in relation to probation. The respondent then referred to Byrne v Australian Airlines Ltd and submitted that the AWA had been subsumed into the contract of employment. This submission was apparently a suggestion that unlike the decision in Byrne, where the contract of employment operated separately from the award or certified agreement, the AWA had been subsumed into the contract of employment so that, presumably, the contract of employment became a law of the Commonwealth for the purposes of s 109 inconsistency.

202 The applicant's response to this additional written submission was that just like an award or certified agreement, the AWA was not intended to operate in disregard of the general law but was subject to the general law, including s 106.

203 It was pointed out that under s 170CC(1)(b) of the Workplace Relations Act 1996, regulations were permitted excluding employees serving a period of probation or qualifying period from the operation of the termination of employment provisions. Relevantly, Regulation 30B(1)(c) excluded from the operation of sub-divisions B, C, D, E and F of Division 3 of Part VIA of the Workplace Relations Act 1996, employees serving a period of probation or a qualifying period of employment, the duration of the period being determined in advance and the period or the minimum duration being three months or less. Thus, it was submitted that the applicant could not seek redress under the Workplace Relations Act 1996 in respect of alleged unfair termination. In addition, the terms of the AWA could not rise above the provisions of the Workplace Relations Act 1996 and thereby confer a statutory remedy upon the applicant where none existed under that statutory regime. In those circumstances, it was submitted, the applicant was entitled to call in aid the general law and in particular s 106 of the New South Wales Act.

204 In relation to the s 109 inconsistency argument, nothing has been submitted by the respondent that would persuade me to depart from the views that I set out in Thornthwaite and Scott. I should make it immediately clear that those cases are considered to be in a separate category from the cases where Federal legislation covers the field in relation to the contract of employment. That was the case in relation to The Australian Broadcasting Commission v Industrial Court (SA) and Barry v The Australian Broadcasting Commission. In these cases the general statutory framework was held to indicate that the legislative intention was that in matters of employment, the statutory corporation would make determinations thus covering the field to the exclusion of any State law which may operate to the contrary. Thus, in the case involving the ABC and the South Australian Industrial Court, Murphy J pointed out that where the Federal law is on a topic of dominant Federal interest, an intention to legislate exclusively, if not express, will generally be implied. The industrial relations of Commonwealth agencies and instrumentalities, particularly ones operating nationwide, were of dominant Federal interest. That approach did not arise in relation to the respondent in this case.

205 In the present circumstances, particular reference may be made to the decision of the full Industrial Court in ICI Australia Operations Pty Ltd (t/as Dulux Australia) v Hutton (1993) 47 IR 288. There the issue was said to be inconsistency between an order made under s 88F of the State Act and the provisions of the Federal award governing the employment. The Full Court noted that clauses of the agreement were similar to those found in Ansett Transport Industries (Operations) Pty Ltd v Wardley (1978-1979) 142 CLR 237. In the course of rejecting the submission that there was s 109 inconsistency, the Full Court stated: Section 88F gave power to the Commission to avoid or vary contracts or arrangements including contracts and/or arrangements of employment and was restricted to the circumstance of the particular contract or arrangement involved. Section 88F did not provide a vehicle for general changes to employment conditions. The legislation considered in Wardley was characterised as dealing with social questions in contrast to 'being narrowly confined to employment relationships determined in the settlement of an industrial dispute' …; the same might be said about legislation such as 88F which deals with the unfairness, harshness and unconscionability of a particular contract or arrangement. On the approach adopted in Thornthwaite and Scott , s 106 of the New South Wales Act may be said to deal with contractual unconscionability while awards and certified agreements (and I would include AWA's) deal with a distinctly different subject matter. That is why, generally speaking, there is unlikely to be found inconsistency between s 106 of the Act and these Federal instruments. Without repeating them, I adhere to the approach set out in Thornthwaite and in particular the summary of considerations set out in paragraph [77] and those mattes dealt with in sub-paragraphs (d)(h)(j) and (n) as particularly relevant to the present case, and also the contents of paragraph [81].

206 Before applying these principles to the facts of this particular case, it is appropriate to consider the issue of whether or not the terms of the AWA were incorporated in Mr Hogan's contract of employment. The respondent made reference to the majority judgment in Riverwood International Australia Pty Ltd v McCormick (2000) 177 ALR 193. The majority held that a written contract of employment which stated that the employer agreed to abide by all company policies and practices currently in place, any alterations made to them and any new ones introduced, became a contractual term which obliged the employer to pay redundancy payments set out in its Policy Manual. In BHP Iron Ore Pty Ltd v The AWU (2000) 102 FCR 97, a Full Court of the Federal Court considered the principles applicable in deciding whether an award had been incorporated into a contract of employment. In that case, new employees were given a document which contained the following clause: The terms and conditions of employment which include, but are not limited to those set out herein. In general, the terms and conditions of employment are as prescribed in the Iron Ore Production and Processing (BHP Iron Ore Limited) Award No A29 of 1984 and the BHP Iron Ore Enterprise Bargaining Agreement 1993 (EBA) and the Stage I and II Award Restructuring Agreement. Where any inconsistencies exist, the conditions as set out in the EBA shall prevail. Employment with BHP Iron Ore Pty Ltd is dependent upon acceptance of all the items and conditions of employment. At first instance it was decided that it was seriously arguable that this document served to incorporate the terms of the award into each contract of employment. In relation to this approach the Full Court stated: [81] We have been persuaded that His Honour's approach to this issue was not correct. In the first place, it is now authoritatively established that if an award is to be incorporated into a contract of employment, express provision to that effect is required (see Byrne v Australian Airlines Ltd (1895) 185 CLR 410. In Byrne it was held that the obligation to observe an award arose by force of statute, not because the award was imported into a contract of employment independently of the parties' intentions; and that the provisions of the award were not an implied term of the contracts of employment, because the implication was not necessary for their reasonable and efficient operation in all the circumstances. [82] Secondly, we have difficulty in accepting that the document relied on by his Honour was intended to have the contractual force suggested. The document is entitled 'Information for New Employees at Newman'. In our view, that is an appropriate description of its character. In its form and in its substance it is not, and does not purport to be, an independent contract of employment, or a document recording or evidencing such a contract. On the contrary, the document makes it plain that the employment relationship is governed, not by any free-standing contract, but by the award. [83] The document commences with the statement which we have set out above, under the heading 'Conditions of Employment'. As has been seen, it is there stated that the conditions of employment are: '[i]n general … as prescribed in the … Award … and the [EBA]' and that '[w]here any inconsistencies exist, the conditions as set out in the EBA shall prevail'. This makes it plain, in our view, that the relationship is governed by the award and the EBA to the exclusion of any independent contractual arrangement. … [85] In our opinion, when the document is read as a whole, it is clear that it was not intended that the terms of the award were to be picked up as a free-standing contract of employment (see Secretary of State for Employment v Associated Society of Locomotive Engineers and Firemen (No 2) [1972] 2 QB 455 at 490).

207 The respondent's letter to Mr Hogan required him to accept the offer of employment detailed in the letter of appointment on the conditions outlined therein. That letter contained the following paragraphs: It is a condition of this offer of ongoing employment that you and the company enter into two agreements: firstly, an employment relationship agreement which is an Australian Workplace Agreement (AWA) made under the provisions of the Workplace Relations Act 1996 and secondly, an agreement to terminate that AWA when a certified agreement is made and certified by the Australian Industrial Relations Commission. Copies of both agreements are included in the Information Kit that accompanies this letter … As has already been explained, the AWA is accompanied by an agreement that allows the termination of the AWA in certain circumstances. It is a condition of your employment that you enter into this agreement. The agreement allowing for termination of the AWA is designed to bring to an end the AWA so as to permit effect to be given to a collective certified agreement between Employment National (Administration) Pty Ltd and its operational and support staff when such an agreement is made. In addition to the AWA, the company has a Personnel Policies and Procedures Manual which sets down other matters relating to the regulation of your employment within the company. A copy of the Manual is included in the Information Kit. You will be required to comply with the policies and procedures contained in this Manual. One of the important matters referred to in the Manual relates to a probationary period of employment. You will be on probation for the first three months of your employment and during this period your technical ability to do the job, your ability to work effectively in a team and your performance generally will be monitored and assessed. Your manager will outline any specific requirements relating to this condition of employment. You can be dismissed for any reason during this period by the company giving you one week's notice or one week's pay in lieu of notice. Employment with the company as Client Service Consultant will be full-time and ongoing. It can be terminated by you or the company giving a minimum of one months notice. If the company is required by legislation to give more than the notice specified above, additional notice will be given by it or it will make payment to you of a corresponding amount of salary in lieu of the additional notice. Should your employment be terminated for any reason other than serious misconduct, the company's redundancy arrangements, if applicable, will apply .

208 In relation to the issue of whether or not the AWA was incorporated into the applicant's contract of employment by virtue of the terms of the letter of offer, applying the approach of the Full Court in the BHP case, and reading the document as a whole, it would appear that it was a requirement of the respondent that the applicant enter into an AWA but it does not appear to be the intention of the respondent that the terms of the AWA would, separately, become part of the contract of employment. While it is true that the AWA was sent with the letter of offer for signature on acceptance by the applicant, it is clear that the respondent wished to be bound by a certified agreement entered into with all of the employees and when that was in place that would trigger the termination of the AWA. The terms of this agreement were not disclosed and probably were not then known. This requirement also undermines the allegedly "personal" nature of the AWA relied upon by the respondent in its inconsistency argument as distinguishing the AWA from awards or certified agreements. The condition of the contract of employment was simply that the AWA and the termination agreement be entered into - not that the terms of the AWA (or certified agreement yet to be made) were part of the contract of employment. Further, the respondent's inconsistency case is not advanced by a finding that the AWA was incorporated into the applicant's contract of employment. Even if there was incorporation, the terms of the AWA would merely become contractual - they would be enforced like any other contract. Importantly, incorporation would not convert the contract into a law of the Commonwealth for the purposes s109 of the Constitution: the contract would remain just that, a contract.

209 The next matter to be considered is the issue of probation. The letter of offer speaks of compliance with the policies and procedures contained in the company manual. It then is stated that the applicant would be on probation for the first three months. The Manual, under the sub-heading "Probationary Period", stated that employment with the company would be subject to a probationary period of three months from the commencement of employment. The award made no specific provision but stated in paragraph 8.1.7 as follows: At the company's discretion, you may be employed on probation during the first three months of your employment. Your period of probation (if any) will be recorded in writing at the time of your engagement. The AWA made no direct reference to a period of probation. The AWA provided that the agreement prevailed over and replaced any award which may otherwise apply. Under the heading "Terms and Engagement and Payment" the AWA provided that, subject to Clause 25, the employment would be ongoing. Clause 25 dealt with redundancy and in a schedule set out payments for redundancy.

210 The only clause of the AWA of relevance, in light of what is known of the Manual, was clause 5 which was headed "Policies and Procedures" and was in the following terms: Company Policies and Procedures Support Agreement This Agreement is supported by policies and procedures determined by the company from time to time. These policies and procedures will not reduce your substantive entitlements as set out in this agreement, but provide guidelines for the fair and efficient administration of the employment relationship. You and the company must comply with these polices and procedures. A nice question arises as to what flows from these terms of the AWA in relation to probation. It appears that the letter of offer which constitutes the contract of employment, did not independently require a probation period of three months. The letter of offer required the policies and procedures contained in the Manual to be complied with and noted that an important matter was the probationary period of employment. It may well be that the contract of employment, by reference to the terms of the Manual, required a probation period of three months. But what is the effect of the provisions of the AWA? The AWA itself required no period of probation. It was to operate regardless of any award covering the employment. In making no provision in relation to probation, which from a new employee's view is a benefit of some significance, the AWA then, in several places, confirms ongoing, full-time employment subject only to redundancy arrangements when they arise. Ongoing employment was offered in the letter of appointment and in the AWA"… it is a condition of this offer of ongoing employment …", "… employment with the company as a Client Service Consultant will be full time and ongoing …"; employment would be ongoing under the AWA, except for redundancy. Clause 25 also referred to ongoing employment. These references confirm that no other matter in the AWA conditioned employment to a period of probation. The only way the AWA could make a period of three months' probation applicable to the signatory is by operation of Clause 5. It is clear, however, from the terms of Clause 5 that the policies and procedures in the Manual were not to reduce "your substantive entitlements as set out" in the AWA. The next thing to note about Clause 5 is that the AWA is "supported by" the policies and procedures of the company and that they "provided guidelines". This is not the language of incorporation. The language suggests that the clause is no more than a note of the role otherwise played by the company's policies and procedures, and acknowledges that they were to be complied with in accordance with their own terms. It is also to be noted that in the letter of offer the respondent stated that "… in addition to the AWA, the company has a Personnel Policies and Procedure Manual …". (emphasis added). It seems the clear intention that, to the extent of any inconsistency, the terms of the AWA would prevail over the company's policies and procedures. Such a provision preserving the terms of the substantive agreement is of significance considering that these arrangements are frequently entered into with individuals who may be expected not to have the same access to advice and resources as a corporation or even perhaps a union member. In all the circumstances, I am unable to accept that the AWA specified, by incorporating the terms of the company Manual, a period of probation. In those circumstances, the probationary period (if it exists) is contractual and is not imposed by the terms of the AWA. This position is confirmed by the letter of termination which stated that the respondent was acting on the terms of the Manual and makes not mention of the AWA. No issue of inconsistency under s 109 of the Constitution therefore arises. There is also force in the applicant's submissions that the terms of the Workplace Relations Act 1996 and the AWA leave unimpeded the application of the general law and provisions of the general law such as s 106 of the New South Wales Act.

211 The other order I proposed to make varied the contract of employment to insert a term preventing the applicant from being required to make claims for placement fees which were not justified or authorised under the arrangements between the respondent and the Federal Government. That term is purely contractual and does not feature in the AWA or the award, if it applies. Apart from a rather vague suggestion that the AWA covered the field there is little in the respondent's analysis which supports the existence of any s 109 inconsistency. Indeed, the letter of offer contemplates a contract of employment running along with an AWA or a certified agreement. I can see no reason why an AWA, for the purposes of considering s 109 inconsistency, should be regarded any differently from an award or a certified agreement. So much seems to have been accepted in ACTEW Corporation Ltd v Pangallo [2002] FCA 325, per Whitlam and Gyles JJ, especially at [33]. The AWA has statutory, not contractual force.

On the general principles I have earlier referred to and adopted from Thornthwaite and Scott, I am unable to see how the order varying the contract as described would fall foul of the operation of s 109 of the Constitution.

212 In relation to the inconsistency argument reference should also be made to s 170VR of the Workplace Relations Act 1996. In a fashion similar to that provided in relation to the operation of awards and certified agreements, AWA's are to prevail over conditions of employment specified in the State law to the extent of any inconsistency. Section 106 cannot be categorised as a State law specifying conditions of employment. Further, under s 170VR(3) where a State law provides protection for an employee against harsh, unjust or unreasonable termination of employment, however described in the law, the AWA is not intended to affect the provisions of that law providing such protection, so far as those provisions are able to operate concurrently with the AWA. Here, the breadth of s 106 goes beyond unfair dismissal provisions such as found in Part VI of the New South Wales Industrial Relations Act. As pointed out in Thornthwaite, relying upon Westfield v Adams, there can be circumstances where s 106 and unfair dismissal provisions appear to have a very similar operation. It seems that the legislative intent in enacting s 170VR(3) is to preserve the operation of any type of State law that might have the effect of providing protection against harsh, unjust or unreasonable termination (see Thornthwaite [85]). This is another basis upon which s 106 may operate without resulting in s 109 inconsistency.

213 Having considered these various matters in relation to the respondent's s 109 inconsistency argument, that argument needs to be briefly analysed for the purpose of applying the principles which I have indicated I propose to adhere to as set out in Thornthwaite and Scott. In the respondent's written outline of submission it was stated that four terms were sought to be inserted in the contract of employment by way of variation but there is no suggestion in the written submission that those variations (which were otherwise opposed) raised issues of s 109 inconsistency. The written submission proceeded substantially, if not totally, upon the basis that the period of probation imposed by the AWA could not be altered by order of this Court under s 106 of the Act because of s 109 inconsistency. I have earlier analysed the terms of the letter of appointment and the AWA and concluded that the period of probation formed no part of the AWA and, in particular, did not become part of the AWA by incorporation of the Personnel Manual. This fundamental part of the respondent's s 109 inconsistency argument therefore fails. Although not put in terms, it may be possible to regard the respondent's inconsistency argument to raise two further questions: (a) That termination of the applicant was covered by the AWA; (b) the AWA covered the field of employment provisions leaving no room for the operation of s 106 of the Act. These arguments can be quickly disposed of. The question of termination, whether or not covered by the AWA, simply does not arise because in terms there is no order sought and none proposed to be made which seeks to overturn the termination of the applicant. In relation to the AWA covering the field, there was no analysis by the respondent to make out such an argument and in any event, the detailed terms of the letter of appointment indicate that the employment would be governed by terms contained in that letter, the Manual, as well as terms contained in the AWA or the certified agreement which would replace it. That conclusion would be, in addition, supported by an application of the matters referred to in paragraph [52] in Scott. The s 109 case for the respondent, of course, leaves untouched the variations to the contracts sought by the applicant arising from the conduct of the respondent: those orders are primarily opposed on the basis of merit considerations.

214 In a related submission the respondent suggests that, putting s 109 inconsistency to one side, the orders merely seek compensation for the loss of an employment contract contrary to what was said in Beahan at 685. I have earlier analysed the substance of this argument and have rejected the essence of the submission. Where unfairness is found in a relevant contract and an order is made to vary or rescind that contract under s 106 of the Act, the Commission is then left with a very broad discretion when considering what order for the payment of money should be made in all the circumstances of the case. The methods chosen to justify a money order will not necessarily convert a case already within jurisdiction to being one beyond jurisdiction. That appears to be the approach urged by the respondent: however, the analysis of the cases on how the compensation jurisdiction is exercised, in Westfield Holdings v Adams (2001) 114 IR 241 and other recent cases, demonstrates the error of this submission.

215 In relation to other matters of merit the respondent submits that the Court would not exercise its discretion because here the period of employment was subject to a probation period. It points out that if the case was in fact an unfair dismissal claim it could not be considered because of the provisions of s 83(2)(b) and Clause 6(1)(c) of the 1996 Regulation. For reasons I have already outlined I have found that the period of probation was unfairly imposed. In the light of that finding the consideration urged by the respondent not only lacks persuasive force but as a matter of principle is irrelevant. This is not an unfair dismissal case simpliciter (see also Incitec Ltd and anor v Industrial Court of New South Wales (1992) 45 IR 155).

216 The respondent also raises the applicant's behaviour. In essence, the argument is that once having formed the view that there was a fraudulent practice in dealing with FOE the applicant was under an obligation to immediately raise the matter with the respondent and put the respondent on notice. It was submitted that apart from failing to take such prompt action, the applicant, in essence, kept this information secret to himself so he could use it to his own advantage at a later time. The first thing to note about this submission is that it does not accord with the facts I have found. It appears that when the applicant discovered the practice in relation to FOE's, late in his period of probation, he raised it in a heated argument with Ms Delf who was the second in charge of the office and his immediate superior. He appears to have been so disillusioned by her response, supported by Mr Hampton, that, after discussing the situation with his wife, he determined that the better course for him was to leave his employment in circumstances where he had been out of work for a considerable period and obviously was in need of the job. Far from keeping the procedure secret he exposed it and when confronted by the continuing attitude of defiance by those in charge and those with whom he worked, he chose to give up his job which must have been a very difficult and serious decision for him to make. Further, there is no suggestion that in the three weeks that he was aware of the inappropriate procedure in relation to FOE's that he was under any investigation or other detriment that might suggest to him that he could keep the information secret to ward off the effect of an impending adverse decision about his employment. In fact, he had just been given a glowing appraisal by the officer in charge and there was no evidence to suggest that before 10 August 1999, he had any reason to doubt that his employment was in danger. It is also understandable that in the circumstances of being confronted by two senior officers and being informed that he was not a team player, Mr Hogan proffered a reason why there was no team spirit, namely the disagreement about the procedure in relation to FOE's. Mr Hogan appears also to have been influenced by his view of what happens to "whistleblowers" - namely that they become the victims. He was frank in stating that in effect he was not courageous enough to become a whistleblower, especially in circumstances where he did not believe he had support from two of the three other people similarly employed in the office. This view was expressed from the time of the heated argument. It was not a case of Mr Hogan keeping this information to himself in order to advantage his position - it was a reaction to a workplace philosophy with which he could not agree and where he and his wife determined he was better off to resign.

217 In the circumstances I do not believe that the applicant can be described as not bringing "clean hands" to this litigation. The circumstances do not justify the denial of any remedy available to Mr Hogan under s 106 of the Act.

218 It is next necessary to consider whether any order as to the payment of money in connection with the contract should be made pursuant to s 106(5) that is, a sum that the Commission considers just in the circumstances of the case. In essence, the applicant sought an amount of money to compensate him for the period during which he was unemployed, being approximately seven and one-half months at the rate of $690 per week paid to him by the respondent. In broad terms that amounts to a claim of something slightly over $22,000 together with a claim for compensation for the anguish, grief, pain and suffering occasioned to the applicant, general damages and interest. There was no evidence, and no medical evidence, which elevated the anguish and grief suffered by the applicant over and above those feelings normally resulting from the sudden cessation of employment in circumstances where the employee feels unfairly or harshly treated.

219 The applicant points to the aggravating feature of being unable to finalise employment with the Taxation office, which was offered to him, because of the inability to secure a service record or other reference from the respondent. In those circumstances the offer of employment was withdrawn. There was no issue raised by the respondent that the applicant had not attempted to mitigate his loss by looking for further employment, nor was there any challenge to the applicant's case that he had been unemployed for a period of approximately seven and one-half months after being terminated by the respondent. I accept the applicant's submissions in this regard.

220 In Westfield Holdings v Adams the Full Court dealt with the general nature of s 106 of the Act and the nature of the orders which may be made following a finding of unfairness. It was accepted that s 106(5) provided a wide power to grant compensation which was not limited by common law concepts of assessment of damages. The court referred to the judgment of Sheldon J in Davies v General Transport Development Pty Ltd in which his Honour said of the then s 88F(2): By adding sub-s(2), it gave the Commission power, when avoiding or altering a transaction to "make such orders as to the payment of money … as may appear to the Commission to be just in the circumstances of the case. Not only can no wider discretion be conceived, but the whole subject of right and remedy under this section was thus committed exclusively to the Industrial Tribunal. The Full Court continued: [91] In Barclays Australia Investment Services Ltd v Nordby (1995) 99 IR 258 at 279 a Full Bench of the Industrial Court of New South Wales (Bauer, Glynn and Hill JJ) said: The task of assessing a 'just' monetary amount is one which, not infrequently, involves the exercise of broad judgment without the assistance of defined and identifiable parameters or heads of loss or damage.

221 The Full Court also referred with approval to the judgment of the Full Industrial Court in State of New South Wales v Health and Research Employees' Association of New South Wales (unreported, Fisher CJ, Bauer and Hill JJ, 31 March 1993). In that case the Court stated: It is clear that an instruction for the payment of a sum 'just in the circumstances' in s 88F(2) has a wider base than that generally available under the principles of common law damages. Indeed, the existence of s 88F indicates that the legislature found that common law remedies are not necessarily appropriate and it seems to follow, insofar as argument by analogy might be useful, that although persuasive, reliance solely upon common law rules as to 'damages' may well be inappropriate. Further, Kirby P in Walker v The Industrial Court of New South Wales (1994) 53 IR 121 at 135 said: The High Court of Australia, and this Court, have repeatedly stressed the very wide discretion conferred by s 88F upon the former Industrial Commission (and now the Court). When s 88F(1) attaches, the remedies that are then at the disposal of the Commission (now the Court) are also extremely wide. There is no warrant for confining this very large power, or for narrowing the circumstances of its exercise, except as statute provides …

222 I have been guided by these approaches in determining the order that should be made pursuant to the provisions of s 106(5) of the Act. In assessing the amount of money to be paid by the respondent which is just in the circumstances of the case, I have had regard to the following matters: (a) the applicant's unemployment for a period of approximately seven and one-half months; (b) the imposition of a period of probation which was not objectively justified by the respondent but simply imposed as part of its standard form offer of employment; (c) the unequal bargaining position of the applicant, both in relation to the formation and terms of the contract, and also in relation to the manner in which it was carried out; (d) the termination of the applicant's contract of employment without adequate investigation and consultation and on a basis which was not justified on the material before the decision makers; (e) the applicant's loss of the benefit of a full and proper inquiry into all matters during his tenure of ongoing employment, when this benefit was lost by applying an unfairly long period of probation; (f) the unfairness associated with the respondent's speedy decision to terminate before the period of probation concluded in order to avoid a proper investigation of the complaints made against the applicant and the complaints raised by the applicant, together with the failure to inform the applicant that he could be reinstated should the investigation support his allegations; (g) the unfairness of the pressure applied to the applicant to make unauthorised claims in relation to FOE placements. (j) the loss to the applicant of the benefit of long term, ongoing and secure employment with the respondent. Bearing these matters in mind the applicant should be paid the sum of $18,000 by the respondent plus interest.

ORDERS 223 The Court makes the following orders:

1. A declaration that the contract between the applicant and the respondent under which the applicant performed work in an industry was at its inception, and became by reason of the conduct of the respondent, harsh and unfair.

2. An order varying the contract between the applicant and the respondent from its commencement, so as to include the following terms: (a) the applicant shall not be required (either directly or indirectly) to make claims for placement fees in relation to persons who find their own employment unless authorised to do so under the arrangements existing between the respondent and the Federal Government; (b) the applicant shall not be dismissed or otherwise disadvantaged in his employment for any reason relating to his failure to make claims for placement fees in relation to persons who have found their own employment in circumstances where such claims are not authorised under the arrangements existing between the respondent and the Federal Government; (c) the applicant shall not be dismissed or otherwise disadvantaged in his employment, for any reason relating to his reporting of the practice of making unauthorised claims for placement fees in relation to persons who found their own employment; (d) the initial employment will be for a period of two months probation which shall not be unreasonably terminated by the respondent.

3. The respondent will pay the applicant the amount of $18,000 plus interest.

4. The respondent will pay the applicant's costs of the proceedings.

224 If any party wishes to be heard in relation to the order for costs they may do so by notifying my Associate within seven days and by notifying the other party of the issue or issues which are sought to be raised. Should any party seek to have the question of costs addressed, upon hearing the parties the Court may reconsider or otherwise amend the costs order.

DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.