Howell v Red Australia Equipment

LEGAL REPRESENTATIVES: RESPONDENT Mrs E Morson Australian Industry Group

JUDGMENT: - 8 - INDUSTRIAL RELATIONS COMMISSION OF NEW SOUTH WALES CORAM: HARRISON DP Friday, 31 May 2002 Matter No IRC 7968 of 2001

Application re unfair dismissal pursuant to section 84 of the Industrial Relations Act 1996 DECISION [2002]NSWIRComm 119 1 This matter was subject to arbitration proceedings on 6 May 2002 consequent upon earlier proceedings which determined that the matter could not be settled by agreement between the parties and which gave rise to directions for the filing and serving of statements of evidence. 2 On hearing Mr S Austin of Counsel, instructed by Mr S Churches, appeared on behalf of Mr Trevor Howell, the applicant. Mrs E Morson Australian Industry Group, appeared on behalf of Red Australia Equipment Pty Ltd, the respondent, with Mr Gavin Pringle and Mr Tony Iredale. 3 Mr Austin brought evidence from Mr Howell. 4 Mrs Morson brought evidence from Mr Pringle, Employee Relations Consultant with the respondent; and Mr Iredale, employed by the respondent as Sales Manager. THE EVIDENCE 5 The evidence established that Mr Howell was employed by Red Australia from 15 January 2001 to 8 October 2001 in the capacity of Area Sales Manager. Mr Howell commenced employment at the Ourimbah/Gosford Branch, reporting to Mr Jeff Gearing, Branch Manager, at the Sandgate office. At the time of Mr Howell's engagement Mr Iredale was the Area Sales Manager at Sandgate and a Mr Kelly was the Area Sales Manager at the Dubbo office. 6 Mr Howell's duties involved the sale of forklift trucks and related equipment, including material handling equipment, and the sale of maintenance and service contracts for equipment which was either sold or leased to clients. Mr Howell spent little time in the Ourimbah/Gosford office, his duties requiring him to visit clients and potential clients and regularly report to the Sandgate premises. 7 Mr Howell's evidence is that in May 2001 he became aware that a Mr Robert Rambough, with whom he had worked previously, was returning from Western Australia to the Newcastle area. Mr Howell deposed that he was aware that Mr Rambough had extensive sales experience in the relevant field and accordingly recommended him to Mr Iredale, should the respondent require additional sales staff. 8 Mr Rambough arrived in Newcastle in June 2001. Mr Howell provided him with contact details for Mr Iredale and Mr Gearing. Mr Rambough was subsequently employed and the sales areas were reorganised, resulting in Mr Howell losing some of his area to accommodate the now four Area Sales Managers engaged by the respondent. 9 In September 2001 the respondent took a decision to close the Ourimbah/Gosford office due to economic circumstances and retrenched Mr Howell. The bona fides of the decision to close the branch for financial reasons is not challenged, nor is the respondent's decision to make redundant one position. The complaint of unfairness from which relief is sought is that the applicant was selected for that apparent redundancy in place of Mr Rambough, who had been employed during the course of consideration of closure of Gosford and other operating locations. 10 Mr Howell's evidence is that without any information available to him of uncertainty of future employment, he took two weeks leave, due to return on 8 October 2001. On Mr Howell's return from leave he was informed by Mr Iredale that he had been made redundant. This evidence is found at para 44 of Mr Howell's affidavit (Ex 1) in the following terms: Tony [Iredale] said to me, "Trevor this is not a sales meeting, I have got some bad news, unfortunately I have got the job to let you know that you have been made redundant with the company from today." He said "I have got all the paperwork for that here, I would like to read it" and he handed me some papers that included a certificate of service, a letter informing me of my redundancy dated 5 October 2001 and a document headed termination advice annexed hereto and marked with the letter "B" are copies of those documents. I read the documents. After reading them I said to Tony "this is bad news." He said "yes the Central Coast branch is also no longer as from today." I believe he also did tell me that the Gold Coast branch was also being closed on the same day. I didn't say very much at all except to say "well there is not much I can do about it." Tony also said after you have had a read of that stuff again at home if you are not happy with anything just contact me." I then left the office. Another staff member drove me home in the company car and he retained possession of the company car after dropping me at home. 11 Mr Howell's evidence is that he was shocked and disappointed at the termination of his employment, and he was not aware that a redundancy could, in particular circumstances, found an application for relief from unfair dismissal. 12 Mr Howell's evidence is that within a few days he commenced to seek alternate employment and was successful in obtaining a position in which he was engaged for a period of two weeks, earing approximately $500 per week before tax. Mr Howell's evidence is that he resigned from this position consequent upon that employer failing to make payment of wages in the second week of his engagement and, having regard to his knowledge of sales and turnover acquired during the period of his employment, held grave concerns regarding the viability of the organisation which led to a belief that he would not be paid on a regular basis. Mr Howell has been unsuccessful in finding employment since that engagement. 13 Subsequent to the termination of the latter employment Mr Howell discovered that there may be grounds for an application for relief from unfair dismissal and consulted Mr Churches on 12 November 2001, putting in train the events leading to the filing of this application on 30 November 2001. 14 The argument advanced by Mr Austin is that Mr Howell's sales performance was superior to that of Mr Rambough and that Mr Howell should have been retained in employment on that basis and in consideration of his longer service. Mr Austin, supported by evidence from Mr Howell, put that reinstatement or re-employment were not practical and sought compensation, which he acknowledged, given that Mr Howell had been employed for less than twelve months, would fall at the lower end of the scale. 15 Mr Austin submitted that an exercise of discretion to admit the application out of time was justified. 16 Mrs Morson relied upon the evidence of Mr Pringle that Mr Rambough had been engaged to fill a genuine vacancy at the time of his appointment, and that no adverse finding was available from the filling of a vacancy during the course of a national business restructure. 17 Mr Pringle's evidence is that in June 2001 Mr Gearing, the then Northern New South Wales Branch Manager, was informed by Mr Caldwell, the General Manager, Finance and Operations, that he had until the end of September 2001 to improve operations at the Gosford branch if it was to stay open; which, in Mr Pringle's evidence, was quite a distinct and separate consideration from the vacancy arising at the Sandgate branch. 18 Mrs Morson submitted that she was unable to bring evidence from Mr Gearing, who had left the respondent's employment in acrimonious circumstances. 19 Mrs Morson opposed the admission of the application out of time, submitting that the application was so far out of time as to visit prejudice upon the respondent, and that the applicant had failed at any time during the course of the 21 day period allowed by the Industrial Relations Act 1996 ('the Act') to indicate to the respondent in any way, shape or form, that the termination of employment was other than accepted. 20 Mrs Morson noted that in addition to the applicant's failure to put the respondent on notice, there was no action by Mr Churches to do so subsequent to his first meeting with Mr Howell on 12 November 2001 and prior to the filing of the application on 30 November 2001. 21 Mrs Morson referred me to the following list of authorities to support her submissions: · Graham v Micromex [2001] NSWIRComm 123 · Brisbane South Regional Health Authority v Taylor (1996) 70 ALJR 866 · McKinley and Port Stephens Baywatch Pty Ltd [1998] NSWIRComm 441 · Gallo v Dawson (1990) 93 ALR 479 · Smith and Australia Meat Holdings Pty Ltd [2000] NSWIRComm 1135 · Lucic v Nolan and Others (1982) 45 ALR 411 · Baxter and Charlestown Shopping Centre Holdings Pty Ltd (Harrison DP, IRC 1999/829, 17/3/99 unreported,) · Fuller and Southeron Earthmoving Pty Limited [1998] NSWIRC 420 · Quality Bakers of Australia Ltd v Goulding and Another (1995) 60 IR 327 · Thomas v Repco Auto Tech (Tabbaa C IRC1998/3900 23/3/98 unreported) 22 In particular, Mrs Morson relied on the following passages from Graham v Micromex:

28 A primary rationale for the imposition of the time limit is that a respondent is entitled to know within a reasonable time (21 days) that the termination is to be challenged. Such advice by filing of an application in time or such other effective advice allows consideration of the primary remedies of reinstatement or re-employment at a time when these may be available and practical.

29 The applicant at no time by action or advice prior to filing of the application put the respondent on notice that the termination of employment would be contested or challenged in any way. The actions of the respondent were such that the respondent was entitled to form the view that no further action would be taken by the applicant, a view the respondent was entitled to take as confirmed on the expiration of the 21 day period prescribed by s85(1).

30 An exercise of discretion is not automatic, the onus resting upon the applicant to make out grounds for departure from the mandatory requirements of s85(1) that an application must be made within 21 days of termination of employment.

and from McKinley: The issues of justice and access are addressed by reference to Brisbane South Regional Health Authority v Taylor ((1996) 70 ALJR 866). McHugh J said at page 872 that:

"A limitation provision is the general rule, an extension provision is the exception to it. The extension provision is a legislative recognition that general conceptions of what justice requires in particular categories of cases may sometimes be overridden by the facts of an individual case.... But whether injustice has occurred must be evaluated by reference to the rationales of the limitation period that has barred that action. The discretion to extend should therefore be seen as requiring the application to show that his or her case is a justifiable exception to the rule that the welfare of the State is best served by the limitation period in question. Accordingly, when an applicant seeks an extension of time to commence an action after a limitation period has expired, he or she has the positive burden of demonstrating that the justice of the case requires that extension. 23 The reference to Taylor's case and the appropriate principles flowing therefrom are expressed in Baxter in the following terms:

The principles to be considered by the Commission in the exercise of discretion to accept an application out of time are discussed in Lucic v Nolan and Others ((1982) 45 ALR 411) which holds that an applicant has an onus of proof to positively satisfy the Commission to accept an application out of time over the prima facie rule that it should not be; Griffith Ex-Services Club Ltd v Federated Liquor and Allied Industries Union of Australia on behalf of Vian (51 IR 186) which holds, among other matters, that the Commission must balance the competing interest of the applicant and the respondent in the exercise of discretion to admit an application out of time; and Cohen v Orange City Council (Connor C, IRC1823 of 1995 , 23/11/95 , unreported) where Cohen's case was admitted out of time as the applicant had put the respondent on notice within the 21 day period that an application would be made, a condition which was absent in this matter, the respondent here receiving no indication of litigation until ten months after the termination of employment.

Having regard to the length of the delay and the primary reason advanced that the applicant thought she would obtain other employment and that she was unaware of the right of redress, I form the opinion that the grounds and reasons advanced by the applicant are not such as to sustain the exercise of discretion to admit the application out of time. The length of delay is excessive. It is difficult to accept that the applicant was unaware of the right to seek relief from unfair dismissal given the public notoriety afforded the subject in recent years; in any event, ignorance of the law is no defence. The expressed presumption of finding alternate employment displays an immediate preference against prosecution of a claim within the time limit. There is nothing alleged or implied in respect to the conduct of the employer to give rise to consideration of admission of the claim so far as time is concerned. CONSIDERATION 24 Having regard to the provisions of s 85(3) of the Act, I conclude that the reason for and the length of delay in making the application in this matter are insufficient to support an exercise of discretion. 25 A consideration of hardship that may be caused to the applicant or the respondent falls against the applicant in this matter. The decision to terminate Mr Howell's employment in preference to the retention of Mr Rambough may well have been a poor management decision, having regard to Mr Howell's greater experience and better sales performance, and on the evidence not logistically precluded. However, the failure of the applicant to agitate the matter deprived management of the ability to reconsider and review the decision at a time when reinstatement or re-employment may have been practical and has deprived the respondent of the availability of Mr Gearing, the principle decision maker, in the conduct of these proceedings. 26 There is, in my opinion, nothing in the conduct of the respondent relating to the dismissal which would give rise to a consideration of discretion to admit out of time. At the time of termination the applicant was specifically invited to consider his position and the information available to him and contact the respondent in respect to any matter. 27 For the reasons expressed, I decline to exercise discretion to admit the application out of time. 28 The application is dismissed.

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