Fair Work Act 2009

s.394 - Application for unfair dismissal remedy

Unfair dismissal - alleged serious misconduct - no valid reason for dismissal - procedural deficiencies - harsh, unjust and unreasonable dismissal - reinstatement Ordered.

[1] This Decision involves an application for unfair dismissal remedy made pursuant to section 394 of the Fair Work Act 2009 (the Act). The application was made by Madeline Patricia Wait (the applicant). The respondent employer is Tenterfield Care Centre Limited (ABN 28 136 819 059) (the employer or Tenterfield Care).

[2] The application was filed on 17 October 2017, and the applicant has been represented by the Health Services Union (the Union).

[3] The application indicated that the date the applicant's dismissal took effect was 5 October 2017. Consequently, the application was made within the 21 day time limit prescribed by subsection 394 (2) of the Act.

[4] The matter was not resolved at conciliation and it has proceeded to arbitration before the Commission in a Hearing conducted at Armidale on 24 January 2018, and at Sydney on 9 April 2018.

[5] At the Hearing, Ms S Harper from the Union appeared for the applicant. The applicant was the only witness called to provide evidence in support of the claim. Ms Harper also provided witness statements from a further three individuals. These statements were admitted into evidence without the requirement for cross-examination of the respective deponents.

[6] The employer was granted permission pursuant to s. 596 of the Act to be represented by lawyers or paid agents, and Ms P Lowson, barrister, instructed by Holman Webb lawyers, appeared for the employer at the Hearing. Ms Lowson introduced evidence from four witnesses who were cross-examined by Ms Harper.

[7] The applicant is a woman of some 61 years of age and she had worked for the employer for about 5 years and seven months. The applicant initially worked as a casual Kitchen Hand, and she was subsequently engaged as a Maintenance/Gardening Officer on a part-time basis. The applicant performed a wide range of general maintenance, gardening, cleaning and associated duties. At different times during the period of her employment, the applicant worked at each of two sites operated by the employer and which are located in the New South Wales regional town of Tenterfield.

[8] The employer is a not-for-profit aged care service provider. The employer provides aged care services at two separate sites that are located approximately 700 metres apart, the Haddington Nursing Home (Haddington) and the Millrace Hostel (Millrace). The employer has more than 100 employees.

[9] In about September 2015, the applicant worked at both Haddington and Millrace, and she was engaged to work 75 hours per fortnight across both sites. From about August 2016, the applicant worked only at Millrace, and she continued to be engaged for 75 hours per fortnight working at the one site.

[10] In March 2014, the applicant was issued with a formal written warning for using offensive language towards another employee whom she had called "a bitch". The written warning was issued to the applicant by the employer's then Director of Care at Millrace, Dianne Johnston. In April 2015, Ms Johnston made a file note entitled "Staff Discussion" which was signed by the applicant and which recorded a discussion regarding the removal of leftover food scraps from the kitchen.

[11] In early 2016, the employer restructured aspects of its operations across its two sites such that Ms Johnston's position of Director of Care at Millrace was made redundant, and Ms Julianne Ellis became the Director of Nursing and Facility Manager for both Haddington and Millrace. Later in 2016, an incident occurred whereby the applicant was planting roses at Haddington when Ms Ellis instructed her to remove the roses and return them to Millrace because there was a termite infestation at Haddington. The applicant challenged the instruction to remove the roses, and there was something of an unpleasant interchange between the two women about the matter of the removal of the roses.

[12] On Saturday, 19 August 2017, Ms Ellis received an email communication from a staff member at Millrace which advised that two other staff members had reported seeing the applicant; "putting a chainsaw and edge trimmer from Millrace's shed into the back of her ute. She then pulled the tarp over the top to cover and drove away." The applicant was not rostered to work on Saturday, 19 August 2017, and therefore her attendance at the premises was understood not to be for work purposes. Ms Ellis commenced an investigation into what appeared to be the applicant's unauthorised use and removal of the employer's property, and she obtained written reports from the two staff members who had witnessed the applicant's activities on 19 August.

[13] Ms Ellis commenced to prepare a letter setting out an allegation against the applicant regarding the apparent unauthorised use and removal of the employer's property, namely a chainsaw and hedge trimmer, as witnessed by two staff members on 19 August 2017. Ms Ellis took advice from her HR advisors, Aged and Community Services Australia (ACSA), and she had drafted but not finalised, a letter of allegation when, on the night of 31 August 2017, a Critical Incident occurred at Millrace.

[14] The Critical Incident involved an elderly and frail resident who went missing when, at approximately 8:30 pm on 31 August, the resident was not located when staff went to his room to prepare him for bed and administer medication. Following an unsuccessful search of the buildings and the exterior of the premises, the police were called and an extensive search of the premises was conducted. At about 10:10 pm the missing resident was found lying in an exterior area near the front of the hostel and he had been obscured from view as he was partially buried under a pile of leaves and garden debris.

[15] Once discovered, the resident stated that he was under the leaves to keep warm. He also stated that he had been chased and he was getting away. The resident had packed a bag with toiletries and a jumper. The resident appeared to have fallen, he complained of a sore shoulder, and he had dried blood on his right ear where his hearing-aid had been shattered. An ambulance was called, and the resident was transported to hospital for overnight assessment.

[16] On the morning following the Critical Incident, (Friday, 1 September 2017), the applicant commenced work at her usual starting time of 8 am. A short time after she had commenced work the applicant was informed of the Critical Incident of the previous night by another staff member who was a Registered Nurse (RN Overell). RN Overell had been involved in the search for the missing resident, and she explained to the applicant that the missing resident had been obscured under the leaf debris and that it was necessary to clean up all of the leaves and other debris from the area. At about 9:30 am, after the applicant had completed some other tasks, she went to the maintenance shed where she made a note on a whiteboard about the need to clean the leaf debris from the area where the missing resident had been found.

[17] After making a note on the whiteboard about cleaning up the leaf debris, the applicant collected a rake and wheelbarrow and went to the rose garden and performed gardening work in the rose garden area. While the applicant was performing this work, at about 10:15 am, she was approached by Ms Ellis who told the applicant that she wanted the area where the missing resident had been found to be cleaned up. Ms Ellis told the applicant that she wanted the area cleaned up by lunchtime, and that she would be back at lunchtime to check that it had been completed. The applicant acknowledged this instruction although according to Ms Ellis, she did so in a sarcastic manner.

[18] The applicant finished her work in the rose garden, and she then returned the equipment that she had been using to the maintenance shed. At this time it was approaching 10:30 am which was the time of the allocated tea break, so the applicant proceeded to the staffroom to take a tea break.

[19] On the way to the staffroom the applicant was approached again by Ms Ellis. Ms Ellis asked the applicant if the clean-up of the leaf debris had been done, and the applicant sarcastically replied with words to the effect of "Yeah right, it only takes five minutes." The applicant said that she was going to have her coffee break, to which Ms Ellis replied with words to the effect of; "No Maddie you need to do it now. Then you can have your coffee break." The applicant then responded to Ms Ellis with words to the effect of; "Get real wake up to yourself."

[20] The applicant then proceeded on her tea break, after which, at about 10:50 am, she returned to the maintenance shed and gathered the relevant equipment needed to clean up the leaves and debris from the area where the missing resident had been found. The applicant cleaned up the leaves and debris, and she finished this task at around 1pm. Ms Ellis and RN Overell inspected the site and they confirmed with the applicant that the job had been satisfactorily completed.

[21] The applicant continued to work for the remainder of the afternoon, and at about 4:10 pm Ms Ellis approached the applicant and handed her a letter without further discussion or explanation. The applicant opened the letter which advised that the applicant was to attend a meeting at Haddington on Monday, 4 September 2017 at 9:30 am for the purposes of responding to allegations. The allegations related to the applicant's conduct on Saturday, 19 August 2017, when she was observed to remove the chainsaw and hedge trimmer, and also her conduct of earlier that day, 1 September, which was said to involve a response "with inappropriate verbal comments namely, "what do you think I am, get real"". The letter further stated that the applicant's alleged behaviour constituted unauthorised use of equipment and improper conduct.

[22] On Sunday, 3 September 2017, the applicant sent an email to the employer requesting that the meeting scheduled for the following day be rescheduled so as to provide the applicant with an opportunity to arrange for assistance from a support person. This request was granted by Ms Ellis and the applicant attended for work on Monday, 4 September as usual.

[23] At about 2:30 pm on Monday, 4 September, Ms Ellis handed the applicant another letter without further explanation or discussion. The applicant opened this second letter which was headed "RE: SUSPENSION FROM DUTIES". The second letter advised, inter alia, that the applicant was stood down from her duties as the matters under consideration by the employer involved serious allegations. Further, the second letter advised that the meeting to deal with the allegations would now be held on Wednesday, 6 September 2017.

[24] The meeting to provide the applicant with an opportunity to respond to the allegations proceeded as planned on 6 September. The applicant had the assistance of a support person who was present in the meeting, and a Union official also participated via telephone. Ms Ellis and the employer's General Manager, Ms Fiona Murphy attended the meeting together with another employee who acted as a note taker.

[25] At the meeting held on 6 September 2017, the applicant provided the employer with a document dated 3 September 2017, which set out her responses to the allegations about; 1. Her conduct on 19 August whereby she admitted that she borrowed the chainsaw and hedge trimmer being the property of the employer for her personal use, and; 2. Her conduct on 1 September involving, in particular, her verbal exchange with Ms Ellis regarding the directive to immediately commence the clean-up of the leaf debris.

[26] In broad terms, the applicant confirmed her admission regarding the conduct as alleged in respect to the first allegation. The applicant asserted that she had previously obtained verbal approval for using the employer's equipment for personal use, and that the approval had been provided by her previous manager, Ms Johnston. Further, in respect to the second allegation, the applicant broadly admitted the words that were attributed to her during the verbal exchange with Ms Ellis. However, the applicant rejected that she had been given any directive to undertake the clean-up of the leaf debris as a matter of urgency.

[27] The meeting concluded with the applicant being advised that she would remain on paid suspension from duties and that following a period of pre-approved annual leave from 13 to 22 September 2017, the applicant would be provided with further advice regarding the allegations under consideration by the employer.

[28] On 22 September 2017 and 3 October 2017, the applicant was sent email communications from the employer which required the applicant to attend a further meeting on 5 October 2017. The applicant remained on paid suspension from duties up to 5 October when she attended the meeting with the employer as directed.

[29] At the meeting held on 5 October, Ms Ellis advised the applicant that the employer had made a decision to terminate her employment. The applicant was provided with a letter dated 4 October 2017, which confirmed that the applicant had been dismissed on the basis that; 1. her unauthorised removal and use of the employer's property constituted serious misconduct, and 2. that the applicant had refused to follow a lawful and reasonable request in a timely manner, and her insubordinate behaviour constituted further serious misconduct. The letter of dismissal also referred to s. 12 of the Act, and Regulation 1.07, specifically highlighting that the meaning of serious misconduct involved an employee, in the course of the employee's employment, engaging in theft.

[30] The letter of dismissal provided to the applicant indicated that the termination of employment took immediate effect. However, the applicant was paid an amount equivalent to 5 weeks remuneration in lieu of notice, together with her outstanding leave entitlements.

[31] Following the dismissal the applicant has made attempts to find alternative employment. However, as at the time of Hearing, the applicant had not been able to obtain any income from any other employment.

[32] Ms Harper from the Union appeared for the applicant and she made verbal submissions in addition to documentary material that had been filed. Ms Harper submitted that the dismissal of the applicant was harsh, unjust or unreasonable.

[33] Ms Harper submitted that there was no valid reason for the dismissal of the applicant. The absence of valid reason was said to arise from the employer forming the erroneous view that the applicant had engaged in serious misconduct that warranted termination of employment. Ms Harper made detailed submissions about the two separate matters which were said to have established the serious misconduct for which the applicant was dismissed.

[34] The submissions of Ms Harper addressed the first aspect of alleged misconduct by the applicant involved the alleged unauthorised removal and return of the employer's gardening equipment. Ms Harper submitted that the applicant had always believed that she had approval for the use of the gardening equipment and although the employer could not confirm any written acknowledgement of any such approval, the employer did not attempt to contact the applicant's previous manager, Ms Johnston, in order to determine whether any verbal permission for the use of the gardening equipment had been provided.

[35] Consequently, Ms Harper submitted that the employer's factual finding as to the applicant removing the gardening equipment and using it for personal purposes without authorisation or permission was incorrect. Therefore, Ms Harper said that this aspect of the finding of serious misconduct found against the applicant was not a reason for dismissal that was sound, defensible or well-founded.

[36] Ms Harper made further submissions which challenged the second basis of alleged misconduct upon which the employer had determined to dismiss the applicant. Ms Harper submitted that there could not be a finding made that the applicant had failed to follow a reasonable and lawful direction because the applicant did as a matter of fact, clean up the debris in the garden in the time required by the employer. Ms Harper made submissions which referred to what she described as "particularly obstinate" responses provided by Ms Ellis during her cross-examination on the question as to whether the applicant had completed the task within the time allocated.

[37] The submissions made by Ms Harper asserted that once the employer realised that it could not rely upon any failure of the applicant to actually undertake the required task within the time allocated, it altered the allegation to include alleged insubordination on the part of the applicant. Ms Harper submitted that this aspect of the alleged misconduct was made as a thinly veiled attempt to remedy the underlying flawed reason for dismissal. In respect to the alleged urgency to clean up the leaf debris, Ms Harper pointed to the evidence provided by Ms Ellis that she had told the applicant that she would check that the job had been completed at lunchtime, and that this represented the only indication of the timeframe that was required for completion of the job.

[38] In further submissions, Ms Harper made criticism of the inclusion of the suggestion of theft that was contained in the dismissal letter provided to the applicant. Further, Ms Harper said that it was clear that the employer had included a number of matters as part of its determination to dismiss the applicant which had not been put to the applicant. Ms Harper pointed to allegations of the failure of the applicant to perform work as requested by another manager which she said were matters that the applicant was not informed of, and not provided with an opportunity to respond to. According to the submissions made by Ms Harper, these matters which only came to light after the investigation, were relevant and formed part of the basis for the decision to dismiss.

[39] Ms Harper made submissions which criticised the process that the employer had adopted for dealing with the allegations made against the applicant. In particular, Ms Harper made submissions which criticised the involvement of Ms Ellis in the investigation and ultimate determination to dismiss the applicant. Ms Harper submitted that a primary basis for the dismissal involved the interaction between Ms Ellis and the applicant on 1 September 2017. Ms Ellis was aggrieved by the exchange that occurred with the applicant. However, according to the submissions made by Ms Harper, Ms Ellis essentially acted as investigator and decision-maker in respect of her own complaint.

[40] Ms Harper also submitted that the dismissal of the applicant was particularly harsh. In this regard it was submitted that significant harshness arose because dismissal was an outcome that was disproportionate to the conduct of the applicant. Further, Ms Harper said that particular harshness arose because of the total failure on the part of the employer to take into account the personal circumstances of the applicant. In this regard Ms Harper submitted that the applicant was a diligent worker who had only been the subject of one written disciplinary warning issued during her more than 5 years of employment.

[41] Further submissions made by Ms Harper addressed the question of the remedy sought by the applicant. Ms Harper submitted that the applicant should be provided with a remedy of reinstatement, continuity of service, and full restoration of lost pay. Ms Harper submitted that there was no evidence that reinstatement of the applicant was inappropriate. Ms Harper submitted that there had been no genuine breakdown of trust and confidence, and she said that the employer had introduced allegations of complaint against the applicant which had been advanced in an attempt to challenge any reinstatement of the applicant. Further, Ms Harper submitted that the applicant had not engaged in conduct which would make reinstatement inappropriate.

[42] In conclusion, Ms Harper summarised that the dismissal of the applicant was unfair as it had been based on reasons that were not sound, defensible or well-founded. Therefore, according to Ms Harper, the applicant had not been dismissed for valid reason. Further, Ms Harper submitted that the dismissal of the applicant involved an absence of procedural fairness. Ms Harper urged that the Commission find that the dismissal of the applicant was unfair, and that it would be appropriate for the applicant to be reinstated to her former position, with no loss of continuity, and payment of lost remuneration.

[43] The employer was represented by Ms Lowson, of Counsel, who submitted that the dismissal of the applicant was not unfair. Ms Lowson made verbal submissions which elaborated upon documentary material that had been filed on behalf of the employer.

[44] Ms Lowson commenced her submissions by stating that the issue for determination by the Commission was whether there was a valid reason for the dismissal of the applicant. Ms Lowson submitted that there were two main issues of misconduct that were investigated by the employer and found proven and which represented valid reason for the dismissal of the applicant. Ms Lowson said that the two main issues of misconduct involved firstly, the unauthorised removal of the hedge trimmer and chainsaw from Millrace for the applicant's personal use on 19 August 2017, and secondly, the failure of the applicant to attend to the task of removing debris from a specified area of the grounds, and insubordination to a manager in that regard.

[45] Ms Lowson made further submissions which focused upon the first issue of misconduct involving the removal of the employer's gardening equipment for the personal use of the applicant. Ms Lowson said that it had become apparent that the applicant was dishonest with her employer when, during the investigation, she had asserted that she had authorisation to use the gardening equipment for her personal use. In particular, Ms Lowson submitted that the applicant had subsequently admitted that any authorisation she may have previously obtained from Ms Johnston was confined to the hedge trimmer and she had no authorisation to remove the chainsaw. Consequently, according to the submissions made by Ms Lowson, the applicant had lied to her employer at the outset when she said she had verbal authority to use both items, the hedge trimmer and the chainsaw.

1. Ms Lowson made further submissions which also challenged that the applicant had verbal approval from Ms Johnston for personal use of any of the employer's gardening equipment. Ms Lowson said that the applicant was obliged to call Ms Johnston as a witness so as to provide evidence to prove that verbal approval had been given to the applicant for her personal use of the employer's equipment. Further, Ms Lowson submitted that an adverse inference, in accordance with the principle established in the case of Jones v Dunkel,[1] should be drawn from the applicant's failure to bring evidence from Ms Johnston.

[47] Ms Lowson further submitted that if any verbal authority ever existed it was extinguished by the departure of Ms Johnston. Ms Lowson said that the applicant realised that she did not have any ongoing authority for personal use of the employer's equipment and the applicant knew that she should not be taking that equipment. Consequently, Ms Lowson said that there were certain inconsistencies in the reasons that the applicant gave for her attendance at the workplace on 19 August which exposed her underlying knowledge that she did not have any ongoing authority to remove the gardening equipment for her personal use.

[48] The submissions made by Ms Lowson then examined the conduct of the applicant on 1 September 2017. Ms Lowson submitted that the applicant had been positively rude to Ms Ellis and that she was reluctant to take directions from her managers. Ms Lowson referred to the evidence provided by the applicant during cross-examination where she accepted that her comments to Ms Ellis were cheeky. However, Ms Lowson submitted that the applicant had made rude remarks, and she had shown herself to be insubordinate and reluctant to follow the instructions of the employer.

[49] Ms Lowson made further submissions which stressed that the applicant's insubordination reflected an attitude which meant that the employer had lost trust and faith in the applicant and the employment relationship had been irrevocably damaged. In this regard, Ms Lowson submitted that the employment relationship had been damaged and therefore any reinstatement of that relationship would be inappropriate.

[50] Ms Lowson stressed that the employer primarily relied upon its submission that the dismissal of the applicant was not unfair. However, by way of alternative further submissions, Ms Lowson strongly opposed any remedy of reinstatement. Ms Lowson said that the employment relationship had been severely damaged by the insubordinate conduct of the applicant, and that she had been shown to be dishonest in her answers during the investigation process. Further, Ms Lowson said that the work of the applicant previously undertook had now been allocated to a casual employee and so therefore the job that the applicant previously did no longer existed.

[51] The submissions made on behalf of the employer also acknowledged that certain aspects of the investigation procedure could have been improved. However, Ms Lowson submitted that any identified procedural deficiencies were not of a nature so as to overcome the serious matters of misconduct that the applicant had engaged in, and which provided valid reason for her dismissal.

[52] Part 3-2 of the Act contains provisions which deal with unfair dismissal, and one of those provisions, section 385, stipulates that the Commission must be satisfied that four cumulative elements are met in order to establish an unfair dismissal. These elements are:

(b) the dismissal was harsh, unjust or unreasonable; and

(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and

(d) the dismissal was not a case of genuine redundancy.

[53] In this case, there was no dispute that the matter was confined to a determination of that element contained in subsection 385 (b) of the Act, specifically whether the dismissal of the applicant was harsh, unjust or unreasonable. Section 387 of the Act contains criteria that the Commission must take into account in any determination of whether a dismissal is harsh, unjust or unreasonable. These criteria are:

(a) whether there was a valid reason for the dismissal related to the person's capacity or conduct (including its effect on the safety and welfare of other employees); and

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

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

(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and

(e) if the dismissal related to unsatisfactory performance by the person - whether the person had been warned about that unsatisfactory performance before the dismissal; and

(f) the degree to which the size of the employer's enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and

(h) any other matters that the FWC considers relevant.

387 (a) - Valid Reason for the Dismissal Related to Capacity or Conduct

[54] In this case the applicant was dismissed upon the employer's findings that she had committed acts of serious misconduct. There were two particular aspects of serious misconduct found by the employer.

[55] Firstly, on 19 August 2017, the applicant removed the employer's gardening equipment, (hedge trimmer and chainsaw) from the workplace for her personal use. The employer found that the applicant did not have authority for the personal use of the employer's equipment, and that the unauthorised removal and use of this equipment constituted serious misconduct.

[56] Secondly, on 1 September 2017, the applicant was found to have refused to follow lawful and reasonable requests in a timely manner, and to have been insubordinate towards the Director of Nursing. The employer found that the failure to follow lawful and reasonable requests in a timely manner, and insubordinate behaviour, constituted serious misconduct.

[57] In respect to the first component of the serious misconduct found by the employer, the applicant asserted that her previous manager, Ms Johnston, had provided verbal approval for her personal use of the employer's hedge trimmer. There was no documented record of any such approval, and it was clear that the employer rejected the applicant's assertion that either verbal approval of Ms Johnston was provided, or that such approval could have ongoing application following the departure of Ms Johnston.

[58] There was significant contest as to any inference that should have been drawn from the absence of evidence from Ms Johnston. The applicant said that she had made contact with Ms Johnston and asked her to provide evidence. However, according to the applicant, Ms Johnston was reluctant to become involved in the unfair dismissal proceedings, and the applicant said that she would respect Ms Johnston's wishes and not press her to provide any evidence. Alternatively, the employer made no attempt to make any contact with Ms Johnston.

1. Notwithstanding the contest that emerged as to which Party should have called Ms Johnston to give evidence, the most telling evidence on the issue of whether the applicant had verbal approval from Ms Johnston came from a witness called by the employer, Ms Melling. Ms Melling provided evidence that in August 2016 she made a diary note[2] that recorded that the applicant and her husband had appeared at Millrace on a Saturday and borrowed the hedge trimmer in an event that was almost identical to what she had witnessed on 19 August 2017, and which she subsequently reported to the employer.

[60] However, when questioned as to why she did not report the 2016 event as she did with the same or similar event in 2017, Ms Melling provided evidence which clearly inferred that either Ms Johnston would have approved of the applicant's borrowing of the equipment, or no action would have been taken by Ms Johnston to stop the applicant's actions. Consequently, on any reasonable and objective evaluation, and without seeking any confirmation to the contrary, the employer should have properly concluded that the applicant had been provided with verbal approval from Ms Johnston to "borrow the hedge trimmer." The evidence that was presented to the Commission overwhelmingly supports that position.

[61] The employer erroneously proceeded on the basis that the absence of any documentation confirming approval from Ms Johnston meant that the applicant's actions constituted unauthorised use of the employer's equipment. However, despite being provided with verbal approval to "borrow the hedge trimmer" there were two further aspects of the applicant's actions which potentially invalidated the previous verbal authorisation provided to her by Ms Johnston.

1. Firstly, during the Hearing, Counsel for the employer raised a distinction between authorisation for the private use of the hedge trimmer as opposed to any authorisation for the private use of the chainsaw. The evidence provided by the applicant confirmed that she had borrowed the hedge trimmer on many occasions in the past, but on 19 August 2017, she also borrowed the chainsaw for the first time.[3] Further, the applicant accepted that she did not have authority to take the chainsaw.[4]

[63] Although a distinction was made during the Hearing between any approval to take the hedge trimmer as opposed to the chainsaw, no such distinction arose during the employer's investigation into the allegations regarding the applicant's unauthorised use of the employer's equipment. Further, it was clear that the applicant made the assumption that the verbal approval to use the hedge trimmer would be equally applicable to the chainsaw. The hedge trimmer and the chainsaw are similar pieces of equipment, both being handheld motorised gardening tools. In my view, it was reasonable and open to the applicant to assume that the verbal approval provided for the hedge trimmer would similarly apply to the chainsaw.

1. Secondly, a more significant potential for invalidation of the verbal approval previously provided by Ms Johnston was presented by the applicant's further assumption that the approval provided by her previous manager would continue to operate under a new manager. The applicant said that she was "still going on the previous authority"[5] when she took the equipment on 19 August 2017. The employer stated that "it should have been obvious to Ms Wait that she would need to obtain fresh approval."[6]

[65] Any employee takes a risk if they assume that what was acceptable to their previous manager would also be acceptable to a new manager. In this instance, the applicant was taking such a risk when she continued to borrow the gardening equipment without first clarifying with her new managers, Ms Ellis and Ms Murphy, that it was okay to do so. However, whether the applicant's actions could be attributed to inadvertence, ignorance, foolishness, passive evasion, or any combination of such factors, the conduct of the applicant was erroneously elevated by the employer to represent serious misconduct.

[66] The essential factual circumstances surrounding the allegation of unauthorised use of the employer's equipment were known to the employer from as early as the Monday after the event was reported, Saturday 19 August. Initially, Ms Ellis was treating these allegations with an appropriate level of seriousness. She was gathering statements from witnesses, and finalising a letter that was to be provided to the applicant regarding an allegation of unauthorised use of the employer's equipment. The unauthorised use of the employer's equipment was initially, and properly, not construed as serious misconduct. It was a matter which, at its highest, might properly attract some reprimand and warning.

[67] The subsequent events involving the verbal exchange between the applicant and Ms Ellis on 1 September regarding the clean-up of the leaf debris following the Critical Incident of the night before, caused the employer to treat the unauthorised use of employer's equipment with an entirely unrealistic level of seriousness, such that it artificially elevated the event of 19 August to represent serious misconduct. The artificiality of the employer's contemplation was reflected in the unfortunate use of the suggestion of theft contained in the letter of dismissal. Consequently, when properly evaluated, the actions of the applicant on 19 August, even if considered to represent the unauthorised use of the employer's equipment, did not represent serious misconduct, but rather, inappropriate conduct and wrongdoing which warranted reprimand and warning.

[68] Therefore, to the extent that the conduct of the applicant on 19 August 2017 represented the unauthorised personal use of the employer's equipment, such conduct could not be properly construed as serious misconduct. The reliance upon this event to represent serious misconduct as reason for dismissal of the applicant is not a reason that was sound, defensible or well-founded and therefore not a valid reason for dismissal.

Failure to Follow Reasonable and Lawful Direction and Insubordination

[69] The second component of the serious misconduct found by the employer as reason for the dismissal of the applicant involved her conduct on 1 September 2017. The employer determined that on this occasion the applicant had refused to follow lawful and reasonable requests in a timely manner, and that she was insubordinate towards the Director of Nursing, Ms Ellis.

[70] The letter of dismissal stated that the applicant was directed "on three times by two of your supervisors" to clean up the leaf debris. However, the factual position as understood by the employer was incorrect. Ms Ellis stated that she "understood" that RN Overell had already asked the applicant to clean up the leaves and debris. This understanding was erroneous, as the applicant provided unchallenged evidence that RN Overell had only made the applicant aware of the Critical Incident and the need to have the leaf debris cleaned up. RN Overell had not made any specific direction to the applicant, and particularly, she had made no direction as to when the leaf debris was to be cleaned up.

[71] Later in the morning of 1 September, circa 10:15 am, Ms Ellis encountered the applicant near the rose garden and she told the applicant that the leaf debris needed to be cleaned up by lunchtime. The applicant acknowledged this instruction, albeit apparently in a sarcastic manner. At this time, Ms Ellis did not tell the applicant to stop doing the current task that she was undertaking (rose pruning) and to commence the leaf debris clean-up work immediately. Consequently, Ms Ellis had clearly established the timeframe for completion of the leaf debris clean-up work to be lunchtime.

[72] About 15 minutes later, Ms Ellis then asked the applicant if she had completed the leaf debris clean-up. On any objective assessment this was a peculiar, incongruous inquiry, and it elicited an unfortunately sarcastic response from the applicant. Ms Ellis then instructed the applicant to commence the leaf debris clean-up work immediately despite the applicant indicating that she was about to take a "coffee break". The applicant had been given a lunchtime time frame for completion of the clean-up of the leaf debris, and there was no rationale to support the sudden introduction of immediate urgency that would deprive the applicant of a scheduled tea break. In these circumstances, the instruction given by Ms Ellis was not reasonable.

[73] The instruction given by Ms Ellis may also have been unlawful. The work of the applicant was governed by the terms of the Tenterfield Care Centre Limited, NSWNMA and HSU NSW Enterprise Agreement 2014 - 2017 (the Agreement). Clause 17 of the Agreement stipulates that employees are entitled to certain paid breaks (tea breaks) and unpaid breaks (meal breaks). It would appear from the terms of clause 17.1 of the Agreement that an employee would be entitled to at least one 10 minute tea break in each four hour period of work.

[74] Further, the potential effect of the instruction given by Ms Ellis may have, depending upon how long it took the applicant to complete the clean-up of the leaf debris, caused the applicant to have worked more than 5 hours without either a tea break or a meal break. In those circumstances, the instruction would have had the effect of contravening clause 17.2 (a) of the Agreement. In addition, the instruction given by Ms Ellis appeared to contravene clause 1.9.2 of the employer's staff handbook which relevantly stated; "Meal breaks must be taken."

[75] The employer characterised the conduct of the applicant during the verbal exchange with Ms Ellis on 1 September as insubordination. The applicant clearly disobeyed the instruction given by Ms Ellis at about 10:30 am to immediately commence the clean-up of the leaf debris and to not take her scheduled tea break. However, this was an unreasonable instruction and in general terms a failure to comply with an unreasonable instruction should not represent insubordination.

1. On balance, it should also be recognised that the applicant did make an intemperate remark towards her manager Ms Ellis when she forcefully said words to the effect of; "what do you think I am, get real."[7] This unfortunate remark was made in response to the unreasonable instruction to immediately commence the clean-up of the leaf debris and to not take the scheduled tea break. The applicant acknowledged that she was "not very diplomatic with words"[8] and although this admission was made in respect to written entries that she had made in a communication book, it was clear that the applicant occasionally exhibited a lack of courtesy during verbal exchanges with her managers and other employees.

[77] Therefore, when properly examined, the alleged insubordination of the applicant could not be sustained. The applicant disobeyed an unreasonable and possibly unlawful instruction, and disobedience in such circumstances does not constitute insubordination. However, the applicant should have been reprimanded about her inappropriate verbal comments, and it would have been appropriate to warn her about her general level of undiplomatic or discourteous verbal communication with other employees and managers in particular. Importantly, the actions of the applicant on 1 September 2017 during her verbal exchanges with Ms Ellis, did not represent a refusal to follow lawful and reasonable requests in a timely manner, nor did it represent insubordination.

[78] In summary therefore, the reasons for the dismissal of the applicant were artificially elevated to represent serious misconduct. Although particular aspects of the applicant's conduct on both 19 August and 1 September 2017 were open to justifiable criticism, there was no valid basis to characterise her conduct as serious misconduct. The purported serious misconduct of the applicant was not a reason that was sound, defensible or well-founded. Therefore, there was not a valid reason for the dismissal of the applicant related to her capacity or conduct.

[79] The applicant was provided with notification of the reason for dismissal on 5 October when she attended the workplace for a further meeting with Ms Ellis. Unfortunately, the letter of dismissal was dated the previous day, 4 October 2017, and it referred to the meeting held on 6 September 2017 when the applicant provided her response to the allegations set out in the letter of 1 September 2017.

[80] Consequently, the notification of the reason for dismissal did not properly address the findings of serious misconduct in a manner which would have allowed the applicant to respond to the employer's findings of serious misconduct.

387 (c) - Opportunity to Respond to any Reason Related to Capacity or Conduct

[81] The absence of any prior notification to the applicant that the employer was treating the conduct of the applicant on both 19 August and 1 September as serious misconduct meant that the applicant had no opportunity to respond to the elevated level of seriousness with which the employer was treating the allegations. Although the applicant had been placed on paid suspension from duty and would have understandably assumed that the employer had introduced a heightened level of seriousness, she nevertheless did not have an opportunity to respond to the particular findings that the employer made of serious misconduct. Further, there were other factors that the employer introduced into its consideration regarding the dismissal such as the applicant's written entries into the communications book, and about which the applicant was not advised.

[82] Consequently, the dismissal of the applicant involved some regrettable procedural deficiencies such that the applicant was not provided an opportunity to make out a defence about the findings of serious misconduct and other factors within the employer's consideration before the decision to dismiss was made. In this regard the applicant was denied natural justice.

387 (d) - Unreasonable Refusal to Allow a Support Person to Assist

[83] There was no evidence that the employer unreasonably refused to allow the applicant have a support person present during any discussions relating to the dismissal.

387 (e) - Warning about Unsatisfactory Performance

[84] This factor has no relevance in this instance.

387 (f) - Size of Enterprise likely to Impact on Procedures

[85] The size of the employer's operation should have provided for a much higher standard of procedure to have been followed.

387 (g) - Absence of Management Specialists or Expertise likely to Impact on Procedures

[86] The employer did have access to dedicated "HR specialists," from ACSA. Unfortunately the evidence suggested that such specialists may not have assisted in ensuring that both substantive and procedural fairness was provided to the applicant. In particular, it was regrettable that the assistance of "HR specialists" did not avoid the unwarranted and offensive suggestion of theft contained in the letter of dismissal.

[87] There was no evidence that the employer considered the particular personal circumstances of the applicant, and the impact that loss of employment would be likely to have on a person of her age, geographical location, and limited skills.

[88] The applicant was dismissed upon findings that the employer made of serious misconduct. Upon proper analysis of the conduct of the applicant in respect to events of 19 August and 1 September 2017, there was no proper basis upon which the employer established serious misconduct. The employer had artificially elevated the seriousness of the transgressions, mistakes and impolite comments made by the applicant in respect to the events of 19 August and 1 September 2017. Consequently, the reasons for the applicant's dismissal were not sound, defensible or well-founded. The applicant was not dismissed for valid reason related to her capacity or conduct.

[89] The procedure that the employer adopted in dealing with its investigation into allegations made against the applicant involved particular deficiencies, including that the applicant was not given an opportunity to respond to the level of seriousness that led to the employer finding that the applicant had, on both 19 August and 1 September 2017, committed serious misconduct. Further, the employer introduced into its consideration of the dismissal matters that were not put to the applicant in order to provide her with an opportunity to respond. Thus, the employer denied natural justice to the applicant.

[90] In summary, this case has involved a very regrettable absence of valid reason for the applicant's dismissal. The employer issued unreasonable instructions to the applicant, and an unfortunate verbal exchange occurred between the applicant and Ms Ellis. As a result of this unfortunate verbal exchange the employer artificially elevated the level of seriousness of the matters under consideration, and it erroneously determined that the applicant was guilty of serious misconduct.

[91] Consequently, the dismissal was without valid reason and it was infected with procedural deficiency. The dismissal of the applicant was harsh, unjust and unreasonable. The applicant is a person protected from unfair dismissal, and she is entitled to have the Commission provide an appropriate remedy.

[92] The applicant has sought reinstatement as remedy for her unfair dismissal.

[93] The question of remedy in respect of an unfair dismissal is the subject of Division 4 of Part 3-2 (ss. 390 - 393) of the Act. Section 390 of the Act is relevant to the consideration in this instance and is in the following terms:

"390 When the FWC may order remedy for unfair dismissal

(1) Subject to subsection (3), the FWC may order a person's reinstatement, or the payment of compensation to a person, if:

(a) the FWC is satisfied that the person was protected from unfair dismissal (see Division 2) at the time of being dismissed; and

(b) the person has been unfairly dismissed (see Division 3).

(2) The FWC may make the order only if the person has made an application under section 394.

(3) The FWC must not order the payment of compensation to the person unless:

(a) the FWC is satisfied that reinstatement of the person is inappropriate; and

(b) the FWC considers an order for payment of compensation is appropriate in all the circumstances of the case."

[94] I have carefully considered whether it would be appropriate to make Orders for the reinstatement of the applicant. I do not accept that there has been a genuine loss of trust and confidence such that the employment relationship should not be re-established. Further, I have not been persuaded that the rearrangement of the work previously performed by the applicant now being undertaken by a casual employee, establishes any barrier to reinstatement, or would otherwise make reinstatement inappropriate.

[95] In the particular circumstances of this case, I have formed the view that a significant injustice would occur if the applicant was not provided with the remedy that she has earnestly sought. Therefore, I have concluded that reinstatement would be appropriate in all of the circumstances of this case.

[96] Consequently, for the reasons stated above, I find that the dismissal of the applicant was unfair, and I am prepared to make Orders for the reinstatement of the applicant.

[97] Orders providing for the reinstatement of the applicant will be issued separately. In the event that the Parties are unable to agree on the amount to be paid to the applicant in accordance with Order 3, regarding an Order to restore lost pay, the application will be listed for further proceedings to enable the Commission to determine that amount. Any request for such further proceedings should be made within 21 days from the date of this Decision.

Ms S Harper of the Health Services Union appeared for the applicant.

Ms P Lowson of Counsel with Ms A Mataere of Holman Webb Lawyers appeared for the employer.

1. [1] Jones v Dunkel [1959] HCA 8; (1959) 101 CLR 298.
2. [2] Exhibit 12.
3. [3] Transcript @ PN465.
4. [4] Transcript @PN593 and PN623.
5. [5] Transcript @PN523.
6. [6] Exhibit 9 - paragraph 20.
7. [7] Exhibit 1 - Attachment - MW6.
8. [8] Transcript @ PN296.

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