Johns v Gunns Limited IRCA

to the hearing failed to resolve the matter. WITNESSES The respondent presented its case first in accordance with the principles identified by Northrop J in Johns v Gunns Limited IRCA (unreported) 18 May 1995 at pages 8 and 9 and Selvachandran v Peteron Plastics Pty Ltd IRCA (unreported) 7 July 1995 at pages 3 and 4. Belinda McGrath, Senior Claims Officer, M.M.I. Workers Compensation (Victoria) Limited (formerly Switzerland and General Insurance) gave some limited evidence of: (i) the management of the applicant's second Work Cover claim (ii) the rehabilitation program discussed with the respondent (iii) the reinstatement of weekly payments to the applicant following proceedings in the Magistrates Court (iv) the final cessation of weekly payments (v) the recommendation by a Work Cover Conciliator for a brief continuation of weekly payments, a recommendation which was not accepted by the insurer (vi) County Court proceedings pending in which the applicant again seeks the reinstatement of weekly payments. Deryk Cook, Human Relations Manager, Pilkington (Australia) Limited gave evidence of: (i) his general oversight of rehabilitation policy (ii) the allocation of modified duties to the applicant as a graphic artist's assistant (iii) his directions to his staff to develop staged duties designed to return the applicant to the factory floor as a process worker (iv) his directions to his staff to develop two formal written offers of full time employment both of which were in identical terms and provided for a "stepped staged" return to full time process worker duties on a furnace line (v) his involvement in discussions with the applicant and the applicant's unwillingness to return to full time process work on the factory floor Geoffrey McLeay, People Developer, Pilkington Automotive Division gave evidence of: (i) his role in occupational health and safety training (ii) his involvement in and co-ordination of return to work and rehabilitation programs for injured workers (iii) his attendance together with the applicant and the Work Cover insurer at a Work Cover conciliation on 16 June 1995 (iv) discussions with the applicant about his desire to return to modified duties similar to the graphic artist's assistant duties performed by the applicant between August 1992 and December 1993 (v) discussions with the applicant in which the applicant indicated he had no money and was desperate to return to some kind of paid employment (vi) the preparation of the letter of termination of 14 June 1995 including the discussions with and directions and advice from Mr Brad Gething, Employee Relations Leader, Pilkington (Australia) Limited. The applicant gave evidence. His counsel called no other witnesses. THE HEARING The matter was listed for trial on 27 and 28 November. Mr Kenyon appeared for the applicant and Mr McIlroy for the respondent. At the conclusion of the trial on 28 November I found contraventions of Division 3 Part VIA of the Industrial Relations Act 1988 and ordered reinstatement. These are the reasons for the decision. COMMON GROUND There is a deal of common ground. The applicant was employed by the respondent from 14 May 1987 to 23 June to 1995 when he was dismissed from his employment. The applicant was employed as a process worker at the North Geelong plant in the Automotive Division. He suffered two separate straining injuries to the right ankle in the course of his employment. The first injury occurred in 1988 and the second in 1992. As a result of the first injury the applicant was off work for 8 to 9 weeks. He then returned to normal duties. On or about 18 June 1992 the applicant stepped on an air hose which was lying on the floor of the factory. He twisted his right ankle and suffered a reasonably severe injury to the ankle joint and was away from work for 7 or 8 weeks. He returned to modified full time duties about 14 August 1992 and ceased work on 7 December 1993 when those duties were no longer available. The applicant received work cover payments on 11 November 1994 and these payments appear to have covered in whole or in part his absence from work due to the second injury on 18 June 1992. On 23 May 1995 the insurers terminated weekly work cover payments. Indeed, the insurer had previously terminated the weekly payments on 16 December 1993 having formed the view that the applicant was capable of returning to normal duties or at least to suitable employment as a person with "less than 30% of whole body impairment...who had (refused) a reasonable job offer". The applicant filed a complaint in the Magistrates Court and the decision to terminate the weekly work cover payments was reversed on the basis that at that stage the applicant required further surgery. On 31 May 1995 the applicant claims that a Work Cover Conciliator recommended that he remain on weekly payments until at least 10 July 1995 but that no work cover payments have been received since 23 May. In paragraph 16 of contentions the respondent does not dispute the applicant's statement to this effect in paragraph 6 of the applicant's contentions. The respondent simply states: "Discussions took place between management and the applicant regarding (the applicant's) apparent reluctance to return to shift work." On or about 15 June 1995 the applicant received a letter of termination of employment signed by Mr Geoff McLeay. The letter (Exhibit R6) reads as follows: "Pilkington (Australia) Limited 14 June 1995 Automotive Division Mr J Slezak 11 Nagle Drive Melbourne Road Belmont 3216 North Geelong Dear Mr Slezak, It has been determined that you are unable to fulfil your work contract in so far that you are unable to be gainfully employed at Pilkington. Because of this reason, the decision has been made to terminate your employment contract with Pilkington as at 23rd June 1995. If you have any queries regard this matter you may contact the writer during business hours by phoning 796222. Yours sincerely Geoff. McLeay" Mr McLeay describes himself as a "people developer". I am somewhat out of date and tend to confine my comprehension of that activity to procreation be it in ventro or in vitro. However, Mr McLeay's role, as a person with occupational health and safety training, seems to involve processing of work cover certificates of capacity and I have no doubt that his duties include some involvement in and co-ordination of return to work and rehabilitation programs for injured workers. CHRONOLOGY It has been difficult to establish a precise chronology of relevant events other than from the evidence of the applicant. I found him an impressive, direct, honest witness. The two employee witnesses for the respondent were far less impressive and their evidence on dates and times is less precise. However, the following appears to be a reasonable chronology based on all the evidence. 18 June 1992 Applicant sustains second injury to ankle. 17 July 1992 Insurer admits liability (Exhibit R1). 14 August 1992 (approx)Applicant returns to modified duties as a Graphic Artist's Assistant. February 1993 (approx) Mr Cook states that "after about 6 months" he questioned "his people" about the continuation of the applicant in the modified duties in the position of Graphic Artist's Assistant. Mr Cook states that he got the "line manager and the Occupational Health and Safety Person" to approach the applicant. mid to late 1993 (probably before 21 September 1993); Mr Cook calls a conference and requests that steps be taken to ensure that the applicant "returns to work on the factory floor". 21 September 1993 Bill Nikolovski, (Group Leader - Sidelights) signs a detailed written offer described therein as "a stepped staged return to work...including production duties on the complex bender rotating every half hour between loader of glass from pallet to line, soldering position (left side of line), examining and packing and soldering position (right side of line)...with rotation on all duties as required (including the possibility of fulltime work on the complex bender furnace line after 9 weeks). October 1993 (approx) Mr Cook instructs staff to make a second return to work offer to the applicant. 4 November 1993 A second written offer in exactly the same terms as the offer of 21 September 1993 is provided to the applicant. 7 December 1993 S Falzon, (Unit Manager-Toughening)) writes to the applicant in the following terms: 'Due to the economic condition, the alternative duties are no longer available as of today. However, should you agree to take up the duties offered to you as outlined in the job offer dated 4th November 1993, we would be more than willing to accommodate you in these duties.' The reference to alternative duties was a reference to the applicant's work in the position of Graphic Artist's Assistant and the applicant ceased work on 7 December 1993. 26 April 1994 Applicant undergoes surgery to right ankle and insurer makes a payment of $900. 6 July 1994 Applicant examined by Dr Byrne, Psychiatrist. 24 July 1994 Applicant examined by Dr Piniskier. 30 September 1994 Supplementary report from Dr Byrne. 16 November 1994 Applicant examined by Dr Baker, specialist in Occupational Medicine. 12 January 1995 Applicant examined by Dr Jones, Orthopaedic Surgeon. 19 April 1995 Insurer advises employer that a determination has been made pursuant to S114(2)(b) of the Accident Compensation Act that the applicant is not or is no longer entitled to weekly payments as the worker has been incapacitated within the meaning of the Act for 104 weeks or more and does not have a serious injury and is not totally and permanently incapacitated. 22 May 1995 Weekly Work Cover payments of compensation to the applicant cease. 31 May 1995 Work Cover conciliator recommends that the applicant remain on weekly payments of compensation until he has been further assessed medically by way of a specialist appointment organised for 10 July 1995. This recommendation was not accepted by the Insurer. No payments have been made to the applicant since 22 May and this is the subject of current action by the applicant in the County Court. 13 June 1995 Applicant attends at workplace and requests of Mr McLeay that he be re-engaged on suitable modified duties as soon as possible. Applicant indicates that he has no income and is desperate to obtain suitable employment. 14 June 1995 Mr McLeay prepares letter of termination on the direction of Mr Gething. 23 June 1995 The employment of the applicant with the respondent is terminated. ONUS OF PROOF S170EDA S170EDA applies with respect to terminations where the employee alleges there are no valid reasons for the termination under ss170DE(1) as well as to reasons, not necessarily the only reason, prohibited under ss170DF(1). Northrop J has expressed the opinion in Johns v Gunns Limited IRCA 18 May 1995 (unreported) at page 22 that the opening words of ss170EDA(1) are to be construed as meaning that if, upon all of the evidence, the termination is proved, then the employee is entitled to a remedy unless the employer establishes a valid reason or reasons under ss170DE(1). If established, ss170DE(2) has to be applied. For similar reasons, the opening words of ss170EDA(2) are to be given the same meaning. However, accordingly to Northrop J in Johns at 22 a very important result follows. Under ss170EDA(2), where that sub-section is to be applied, the termination is taken to have contravened ss170DF(1) unless the employer proves: "(c) the employment was not terminated for the particular reason or reasons or for reasons that included the particular reason or reasons" In Heidt v Chrysler Australia Limited (1976) 26 FLR 257 Northrop J dealt with the application of ss5(4) of the Conciliation and Arbitration Act 1904. ss5(4) of the Act was a predecessor of ss170DF(1)(a) of the Industrial Relations Act 1988. Northrop J said: "The provisions of ss5(4) of the Act cast an onus of disproving facts, namely, that the reason for the defendant's action was not actuated by the reason alleged in the charge. It has been held that a defendant need not prove the reason why he dismissed an employee; Atkins v Kirkstall-Repco Pty Ltd (1957) 3 FLR 439. The mere proof of a reason for dismissal, other than the reason alleged in the charge, does not necessarily negate the reason alleged in the charge. A mere denial of the reason alleged in the charge may not be sufficient to satisfy the onus cast upon the defendant. All the facts and circumstances leading up to the dismissal must be considered, including any reason expressed at the time of the dismissal, as well as any denial of the reason alleged in the charge." It is not sufficient for the respondent in this case to establish the reasons for dismissal as set out in the statement of contentions and evidence and that they constituted valid reasons for termination under ss170DE(1). The respondent has to establish a negative namely that the reasons for dismissal did not include the reason that Mr Slezak was temporarily absent from work because of injury. A mere denial may not be sufficient. In this case a mere denial is not sufficient. All the facts and circumstances of the case have to be considered. During the course of the case presented on behalf of Mr Slezak, it was obvious that Mr Slezak was alleging that one of the reasons the respondent terminated him was that he, Mr Slezak, had temporary absences from work because of injury. In my opinion, the respondent has not satisfied the onus of proof cast upon it by ss170EDA(2). The onus is to be satisfied on the civil basis of balance of probabilities. On the whole of the evidence, I am not satisfied, on the balance of probabilities, that the extended absence of work of Mr Slezak because of his unwillingness, and I would say inability, to perform certain process work was not included as a reason of the respondent in terminating the employment of Mr Slezak. Accordingly, on this basis, Mr Slezak is entitled to a remedy. SUITABLE ALTERNATIVE DUTIES The respondent did not produce evidence to establish that: (i) the applicant failed to comply with reasonable directions to return to normal duties under a structured rehabilitation program (ii) the company was unable to provide suitable alternative duties and had taken all steps reasonable and practicable to return the applicant to normal duties in the workplace (iii) the applicant "was unable to fulfill (his) work contract insofar that (he was) unable to be gainfully employed." VALID REASON However if I am wrong and the respondent was to be found to have discharged the onus under ss170EDA, and if the respondent was found to have established that it did not terminate the employment for reasons including temporary absence from work because of injury, the applicant would still succeed. The respondent has not established a valid reason for termination. The respondent has not established that: (i) the offers of September and November 1993 were of work which the applicant could reasonably perform (ii) there were any offers after 1993 of modified duties that the applicant could reasonably perform (iii) the company was unable to provide suitable alternative duties (iv) the company had taken all steps reasonable and practicable to return the applicant to normal duties in the workplace Because of (i) to (iv) above the respondent has also failed to establish that, in terms of operational requirements, it was unable to provide suitable alternative duties and that the applicant was terminated for valid reason associated with the respondent's operational requirements. HARSH, UNJUST AND UNREASONABLE Had the respondent established that there was a valid reason for termination associated with operational requirements the Court would have found nevertheless that a termination was harsh, unjust and unreasonable. There is no evidence of any offer of modified suitable duties from 7 December 1993 to the termination on 23 June 1995. The applicant is 47 years of age. He had worked as a process worker at Ford Geelong for 5 years after migrating to Australia without any skills in English and without any opportunity to utilise his qualifications in teaching or mechanical engineering. He has not at any stage undertaken the training and education which would have been necessary to have such qualifications recognised in Australia. There is no evidence that he could have readily or effectively undertaken such training and, in any event, he has not done so. He worked for several years as a process worker for the respondent. There have been no problems or complaints about his conduct or performance as a process worker with the respondent or as a graphic artist's assistant from August 1992 to December 1993. There is no evidence of offers of modified duties which the applicant could reasonably perform since the cessation of the graphic artist's assistant work on 7 December 1993. The applicant did not refuse to perform all of the duties associated with the September and November 1993 offers. His consistent, firm evidence, which the Court accepts, is that he was willing to perform all of the duties outlined in the September and November 1993 offers except packing and loading glass on the furnace line and loading glass on the line. An examination of the September and November 1993 offers suggests that the applicant, on the basis of medical advice, consistently held to the position that he was not fit or able to perform certain of the process worker duties namely: (i) loading glass from pallet to line (ii) lifting up the glass and stacks or packs into the pallet The applicant did not suggest that he could not perform the following duties: (i) development of employee manuals (ii) taking photographs (iii) art work (iv) clerical work (v) checking quantity and quality of the loads (vi) burnishing terminal contact areas (vii) soldering the connector terminal to the previously prepared glass area on either side of the glass FAILURE TO CALL EVIDENCE A curious aspect of this case is the failure of the respondent to call employees who were directly involved in what the respondent claims were reasonable and persistent attempts to negotiate a return to work. The applicant gave evidence that Robin Hunter, "Bernie" Rowe and Bill Nikolovski were involved. It seems that Stephen Falzon, Unit Manager-Toughening was also involved. However, none of these employees were called to give evidence. No person directly involved in the return to work negotiations with the possible exception of Mr Cook, gave evidence on behalf of the respondent. Furthermore, while Mr Cook gave evidence of some discussions with the applicant he directed that return to work negotiations and offers proceed but did not take part in the negotiations and he did not make the September and November 1993 offers. More surprising again is the failure to call Mr Brad Gething. He signed the employer's Notice of Appearance on 30 June 1995 and was described in that document as employee relations leader. According to Mr McLeay it was Mr Gething who: (i) directed that the letter of termination of 14 June 1995 be prepared and delivered to the applicant (ii) determined on behalf of the respondent that the employment of the applicant was to be terminated effective from 23 June 1995 (iii) approved of the terms and general format of the letter of termination (iv) decided that one week's notice was appropriate Mr Gething was present at the Court for the hearing and was present in Court during the greater part of the hearing. On the basis of the only respondent witness who gave evidence of the termination (Mr McLeay), Mr Gething and only Mr Gething could have given evidence of the reasons for the termination. FINDING At the conclusion of the hearing on 28 November the Court indicated that having heard the evidence and considered the exhibits it was satisfied that: 1. the respondent had failed to discharge the onus under ss170EDA(2) and had therefore breached ss170DF(1)(a) 2. the respondent had breached ss170DE(1) and 170DE(2) 3. the respondent had breached ss170DB(2) but, given the orders about to be made it was unlikely that there was any need for a specific order in relation to that breach ORDERS The Court, not being satisfied that reinstatement was impracticable, and having found contraventions of ss170DF(1)(a), 170DE(1), 170DE(2) and ss170DB(2) orders that: (1) The employer reinstate the employee Jerzy Slezak to either the position in which he was employed immediately before termination or to another position on terms and conditions no less favourable to those on which the employee was employed immediately before termination. (2) All steps necessary are to be taken to ensure the continuity of the employee's employment from the date of termination. (3) The employer pay to the employee the remuneration lost by the employee because of the termination. This sum is to be settled by agreement. In the event that this sum is not agreed by the solicitors for the applicant and the solicitors for the respondent the remuneration lost will be determined by the Court. Liberty to apply is granted. (4) The order for reinstatement of the applicant is effective from Friday 1 December 1995. I certify that this and the preceding pages are a true copy of the Reasons for Judgment of Judicial Registrar Ryan. Associate : Date : 1 December 1995 Appearances: