The provisions of s.170CG(1)(a) and s.170CG(1)(b) having been satisfied the matter was listed for arbitration on 9 and 10 December 1998 in Dubbo.

The applicant was represented by Ms K. Robinson, solicitor of Peacocke, Dickens and Price. The respondent was represented by Mr D. McKay, solicitor of Lovett and Green.

It was the applicant's case in summary that she commenced work on 16 July 1990 until 11 May 1998. Prior to 1990 the applicant worked for six years as a casual. After resigning her employment at the hotel the applicant worked for twelve hours a week at the BP Service Station. The applicant also claimed since that time she has worked 32 hours a fortnight at the Rivergum Lodge. The applicant further claimed that at the Port of Bourke Hotel, prior to January 1998, she worked in the hotel cooking lunches and dinners in the bistro for six days a week. The applicant was working 38 to 50 hours a week until August 1997. In her statement the applicant claimed that in July 1997 the new manager, Mr Riy Fathers, commenced employment with the hotel. The applicant claimed that in November 1997 things started to change, that the management gave her extra duties to do and was required to perform those duties within the existing hours. She further claimed in her statement that the manager would approach her and say words to the effect "You look a bit stressed today". Around mid December 1997 the applicant stated that the management said to staff members that there would be changes in the way the hotel was run in the New Year. The applicant said she heard nothing more about it. On 15 January 1998 the applicant further stated that she went to see the manager in his office about having a staff meeting to discuss any problems within the workplace. She claimed that the manager replied "We will sort it out".

"19. On Monday 19 January 1998, I was called into the Manager's office. The Manager said to me "You have been talking about me and the Hotel to other people". I denied his accusation and said to him words to the effect "Please bring forward the people who I have apparently told these things to as I wish to defend my innocence". He replied to me "I will not". He also said to me words to the effect "You have been seeing your doctor frequently over the last few weeks". I said to him "This is a personal thing between the Doctor and myself".

20. I had been seeing the Doctor over that period but this was because I had a problem with my elbow. I did not bring this to the attention of the Manager at the time as I did not believe that it was any of his business.

21. The Manager then said to me words to the effect, "I am reducing your hours. I have rung the Australian Hotels Association and the General Manager (Mr John Wettenhall). Between us both it has been agreed that what I am doing is okay.

22. He then presented me with a letter. A copy of that letter is annexed herewith and marked with the letter "A"."

After our discussion last Thursday (15th January 1998) in relation to your work duties at the Port of Bourke Hotel and previous discussions in November and December of last year, I have decided to implement procedures which will allow you to access and evaluate your position within the organisation.

Commencing from today, Monday 19th January 1998 your duties will be lunch cook on Mondays, Tuesday and Wednesdays of each week, starting at 10.00am and finishing at 2.30pm. This decision has been made after your advice to me on several occasions of the level of stress that you feel, and as a result you feel you are unable to complete your allocated duties.

To help you in this matter, I have previously released you from the role of ordering foods and have had your hours reduced. This further reduction I hope will allow you to feel more relaxed in the work place.

As a valued member of the team, this decision has been made to ensure your continued health and well being.

This decision will be reviewed at the end of a three month period.

"23. I read the letter in his presence and said to him words to the effect "I can not survive on these few hours". His response was "feel free to go and find another job". I then said to him "You have no right to do this to me". I then walked out of the office. I was extremely upset at what had occurred and surprised at the reduction of hours without previous notice.

24. I had already arranged to have 2 days off and was therefore absent from work on leave on Tuesday 20 and Wednesday 21 January 1998. I then returned to the workplace on the morning of Thursday 22 January 1998. I immediately went to the Manager's office at 9.30 am and said to him words to the effect "Please give me back my work or at least some of it". My request was flatly refused and the Manager replied to me "That is my decision".

25. The Manager then said to me words to the effect "Your position will be reviewed at the end of the three months stress leave. That is my decision." I then left the office.

26. In the weeks following that occasion, I approached the Manager on many occasions and again repeated to him words to the effect "Please give me back my hours or some of my hours"."

The applicant continued to work the hours given to her over the next three months although on occasion trying to talk to the manager. On 22 April 1998 the three month period had expired and Ms Taylor was required to attend the manager's office. The manager said words to her to the effect that nothing had changed but he also indicated to her at that time that he would be reducing her hours further and told her that she would be doing dishwashing only for three and a half hours per day. This meant a further reduction of three and a half hours per week reducing her overall hourly work to nine hours per week. The applicant was also placed on kitchen hand duties to assist the cook. The applicant also claimed that the manager said at that time he was going to retrench her but because of her good skills he was going to keep her on. The applicant also claimed that on 23 April 1998 she went to see the general manager to inform him what had been occurring. The general manager informed her that he had no knowledge of what had been going on but he would speak to Riy Fathers about it.

"33. At approximately 8.30 am on the morning of 25 April 1998, I received a phone call from the Manager. It lasted for about 3 minutes. It was apparent to me that the Manager was very angry. He was yelling at me over the phone. He accused me of "spreading gossip about how I have been treating you in the workplace". He also said to me words to the effect "You have been telling people about victimisation". I said back to him "I did not say anything and I can not be responsible for the actions of other people". He would not listen to my responses and continued to yell at me.

34. He then threatened me that he would "put a Court injunction on you" and then said "I will see you in Court". He then slammed the phone down in my ear.

35. There were other things said during the course of this conversation but I can not recall the entire conversation and above is to the best of my recollection.

36. On 11 May 1998, I made a decision that I could no longer tolerate the conditions in which I was working. I therefore resigned from my position with the Port of Bourke Hotel."

It was the applicant's evidence that although she resigned from her position she felt that she had no alternative but to resign otherwise she would have been terminated.

The respondent's case in summary is that the respondent agreed that the applicant's hours had been reduced. The respondent argued that it was because of the personal and domestic problems the applicant had that she asked the respondent to reduce her hours and at times in the workplace she would be found crying and unable to handle her personal problems. To that end the respondent called six witnesses to support their case. A summary of the witness evidence is as follows.

Mr Geoffrey Mervyn Hall gave evidence in this matter for the respondent. Mr Hall stated in his sworn statement that on Wednesday 2 December 1998 he had visited a friend, a Mr Peter Dennis, in Bourke and had arrived at the house at about 3.30 p.m. When Mr Hall arrived he claimed that Mr Dennis was standing on the footpath talking to a woman in a motor vehicle. Mr Hall claimed he did not know the woman but later found out that it was the applicant. He also said in evidence that Mr Dennis had said words to the effect that he was going to go to Dubbo to give evidence in favour of the applicant in a court case for unfair dismissal against the hotel and that he would be paid $500 for his evidence. Mr Hall also indicated, whilst giving evidence, that he thought that the payment of money for giving evidence was unfair and that he went to the hotel and told them about it.

A statement and evidence was also given to me by Ms Susan Hyland. Ms Hyland is employed at the Port of Bourke Hotel as a permanent multi-skilled hand. Her evidence was that the staff were often unhappy working at the hotel with the applicant because she constantly complained and upset people and was never happy unless picking on someone behind their back. In brief Ms Hyland gave evidence that when Mr Fathers became the manager of the hotel he was very fussy and he particularly reprimanded employees. Ms Hyland also claimed that the applicant could not handle being reprimanded or told how to do her job. She also indicated in her evidence that the applicant made the working environment unpleasant.

Ms Dianne May Simpson who is employed by the hotel as Food Preparation Manager also gave evidence. Her evidence in brief was that when Mr Fathers became manager in the middle of 1997 Margaret Taylor tried to get the rest of the staff to gang up on him. Ms Simpson claimed that Ms Taylor would ring her at home almost every day complaining about Mr Fathers and the changes he was making at the hotel. Ms Simpson's evidence continued in that manner.

Mr John Warwick Wettenhall is the General Manager of the company gave evidence in support of the respondent. In his evidence he told how Margaret Taylor had been employed at the hotel for a long period of time. Mr Wettenhall claimed that on 23 April 1998 Ms Taylor had telephoned him and said that she felt the manager of the hotel and been victimising her and had reduced her hours. Mr Wettenhall said in his evidence that Ms Taylor was very upset on the telephone and after listening carefully to what she had said he would investigate the matter with the manager of the hotel then he would get back to her. When he got back to her to explain what had happened on his investigation he said words to her to the effect "I am aware that your hours have been reduced but this was because of Riy's concern for you to help you cope with the stress that you have been experiencing with your personal problems. Riy has been concerned for your well being as a result of his being aware of your undergoing medical treatment for those problems."

Ms Judith Ann Fathers, wife of Riy Fathers, also gave evidence for the respondent in a sworn statement. Ms Fathers outlined a period of time the applicant had worked for the company, the type of duties that she did and indicated that she knew of Ms Taylor's problems and in particular gave evidence of what occurred at the beginning of January 1998.

"11. At about the beginning of January 1998, when Margaret Taylor came to Riy about her stress problems I was present in the office. Margaret arrived shortly before she was due to start work at 9.00am and said to Riy words to the effect, "I want to have a word with you about my hours". She sat in the green directors chair inside the office door and said words to the effect, "I am really stressed because I have so much work to do and not enough time. I need more hours to do the food preparation, because it is all too much for me". Riy said, "what's the main problem?" Margaret said, "I have got family problems and I am stressed over that" Riy said, "I will have to look at the whole problem, before making a decision about what is best to help you". I typed the letter to Margaret that afternoon."

The current manager of the hotel, Mr Riy Fathers, also gave a sworn statement in evidence. In brief Mr Fathers' statement outlined what had occurred since he had taken over the hotel, how he had taken over a loss making hotel, how he had tried during the first period to work out what had been going on, how he had observed the applicant having problems and in quoting in part from his statement:

"11. I had particular concern about her constant breaking down on the job, she would often be found sitting on her own in the darkened dining room crying or upstairs crying with Leslie Malony. I was genuinely concerned about her inability to cope with her job and with her well being generally. As a result of the discussions with Margaret Taylor it was decided to reduce her stress by taking her off the Thursday and Friday Counter Lunches. She was extremely grateful, and said to me words to the effect, "it's nice to have a boss that cares, not only from a professional point of view, but from a personal point of view also". However, as the 3 month period progressed she came to me on a number of occasions, wanting more hours again. I told her we should stick to the three month trial period as agreed."

Pursuant to s.170CG(3) of the Workplace Relations Act 1996 (the Act) the Commission must have regard to the following factors when determining whether a termination was harsh, unjust or unreasonable.

"(3) In determining, for the purposes of the arbitration, whether a termination was harsh, unjust or unreasonable, the Commission must have regard to:

(a) whether there was a valid reason for the termination related to the capacity or conduct of the employee or to the operational requirements of the employer's undertaking, establishment or service; and

(b) whether the employee was notified of that reason; and

(c) whether the employee was given an opportunity to respond to any reason related to the capacity or conduct of the employee; and

(d) if the termination related to unsatisfactory performance by the employee - whether the employee had been warned about that unsatisfactory performance before the termination; and

(e) any other matters that the Commission considers relevant."

In determining whether a particular termination is harsh, unjust or unreasonable pursuant to s.170CG(3) consideration can be given to whether the penalty of termination is excessive or inappropriate. See Byrne v. Australian Airlines Ltd (1995) 185 CLR 410 at 465 per McHugh and Gummo JJ.

"It may be that the termination is harsh but not unjust or unreasonable, unjust but not harsh or unreasonable, or unreasonable but not harsh or unjust. In many cases the concepts will overlap. Thus, the one termination of employment be unjust because the employee was not guilty of the misconduct on which the employer acted, may be unreasonable because it was decided upon inferences which could not reasonably have been drawn from the material before the employer, and may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted."

If a termination is found to be harsh, unjust or unreasonable s.170CH deals with remedies. It is partially extracted below:

"(1) Subject to this section, the Commission may, on completion of the arbitration, make an order that provides for a remedy of a kind referred to in subsection (3), (4) or (6) if it has determined that the termination was harsh, unjust or unreasonable.

(2) The Commission must not make an order under subsection (1) unless the Commission is satisfied, having regard to all the circumstances of the case including:

(a) the effect of the order on the viability of the employer's undertaking, establishment or service; and

(b) the length of the employee's service with the employer; and

(c) the remuneration that the employee would have received, or would have been likely to receive, if the employee's employment had not been terminated; and

(d) the efforts of the employee (if any) to mitigate the loss suffered by the employee as a result of the termination; and

(e) any other matter that the Commission considers relevant;

...(7) Subject to subsection (8), in determining an amount for the purposes of an order under subsection (6), the Commission must have regard to all the circumstances of the case including:

(a) the effect of the order on the viability of the employer's undertaking, establishment or service; and

(b) the length of the employee's service with the employer; and

(c) the remuneration that the employee would have received, or would have been likely to receive, if the employee's employment had not been terminated; and

(d) the efforts of the employee (if any) to mitigate the loss suffered by the employee as a result of the termination; and

(e) any other matter that the Commission considers relevant."

Considering all that has been put before me in this matter I must deal first with the evidence of the witnesses. In respect of the evidence given by Mr Hall I disregard his evidence totally as it was evidence uncorroborated. In respect of the evidence of Messes Hyland and Simpson I have formed the view that their evidence was unreliable and vindictive and where their evidence differs from that of Ms Taylor I prefer the evidence of Ms Taylor.

In respect of the evidence given by Mr Wettenhall his evidence was forthright and straight to the point. The comment I make about Mr Wettenhall's evidence from a question put to him from myself was that when Ms Taylor approached him to talk about her problem he only discussed her problem with the manager of the hotel. In my opinion he had a duty to verify the alleged victimisation of Ms Taylor by the hotel manager through an independent source. Due to his failure to verify the situation through an independent source Mr Wettenhall made his ultimate decision not to do anything about the incident.

In respect of Ms Fathers her evidence was based on a lot of hearsay. Ms Fathers claimed she was present when Ms Taylor spoke to the manager on the day that the management decided to change her hours and claimed that she heard Ms Taylor appeal to work more hours. Ms Taylor's evidence was quite the contrary to that and in those circumstances I prefer the evidence of Ms Taylor.

In respect of Mr Fathers evidence I found his evidence to be evasive and to the point of not wanting to answer the questions when put to him by Ms Taylor's solicitor. In all respects of Mr Fathers' evidence where it differs from the evidence put by Ms Taylor I prefer the evidence of Ms Taylor.

I have carefully considered all that has been put before me in this matter. The first question which I must decide here is whether Ms Taylor really had no alternative but to give her notice of resignation.

I have formed the view that when Ms Taylor gave her notice she in fact had no alternative because of the dramatic reduction in her hours. It can be said that the dramatic reduction in hours from 38 hours per week down to nine hours per week in a span of a few months caused Ms Taylor undue stress and she had no other alternative than to give her notice of resignation. Therefore I find that the decision of Ms Taylor to resign was as a direct response to the employer's actions and was at the initiative of the employer.

In relation to s.170CG(3)(a) of the Act I find that there was not a valid reason for the termination.

In relation to s.170CG(3)(b), this section is not applicable.

In relation to s.170CG(e) there are no other matters that the Commission needs to deal with.

For these reasons I find that the termination was harsh, unjust or unreasonable.

Having regard to the provisions of section 170CH of the Act, I have formed the view that in all the circumstances, reinstatement is not practicable. Therefore, having regard to the provisions of s.170CH(2), I have decided that an appropriate amount of compensation in lieu of reinstatement pursuant to s.170CH(6) would be an amount equal to 20 week's pay and I will so order. This amount will be based on $13.20 per hour for an average 38 hour week totalling $10,032.

That the respondent, Port of Bourke Hotel, pay to the applicant the amount of $10,032 taxed at the appropriate rate within fourteen days from the date of this decision.

Termination of employment - unfair dismissal - arbitration - termination at initiative of employer - hotel industry - applicant claimed new management had provided extra duties to complete within existing hours - within a short space of time applicant's hours significantly reduced for a three month trial period - at end of trial period applicant's hours reduced further - applicant resigned believing had no alternative - respondent claimed that applicant's hours were reduced due to request by applicant to cope with domestic and personal problems - witnesses called in support of respondent - held - applicant's evidence preferred - applicant had no alternative to resignation due to dramatic reduction in hours - direct response to employer's actions and at the initiative of employer - harsh, unjust and unreasonable - remedy - reinstatement not practicable - compensation ordered equal to 20 week's pay, $10,082.

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