Mr Michael Gelagotis v Esso Australia Pty Ltd [2018] FWC 2398

Mr Michael Gelagotis v Esso Australia Pty Ltd [2018] FWC 2398 - FWC 2018 case summary — Zoe

[5]

[1] This decision concerns applications made by Mr Michael Gelagotis and Mr Michael Hatwell for unfair dismissal remedies under s.394 of the Fair Work Act 2009 (Act).

[2] Mr Hatwell commenced employment with Esso Australia Pty Ltd (Esso) in January 2007. He worked as a power and control technician in the electrical maintenance group at the company's Longford site. He is a member of the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU). From early 2014, Mr Hatwell was an elected shop steward.

[3] On 30 October 2017, Esso summarily terminated Mr Hatwell's employment. He was handed a termination letter which stated that he had engaged in conduct 'designed to ignore, exclude and isolate employees of contractors on site', and that he had used 'offensive and intimidating language towards and about employees of contractors'. The letter also stated that he had been directly involved in a decision to exclude Mr S.P.[1] from the lunchroom, and that he had said to Mr Travis Flens 'You are doing every cunt's job now are you?', and had called him a 'fucking scab.'[2]

[4] Mr Gelagotis was employed by Esso as a maintenance technician in January 2014. In mid-2016 he was elected a health and safety representative. He is a member of the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union known as the Australian Manufacturing Workers Union (AMWU).

[5] On 30 October 2017, Esso summarily terminated Mr Gelagotis' employment. He too was handed a termination letter stating that he had engaged in conduct 'designed to ignore, exclude and isolate employees of contractors on site'. The letter stated that he had initiated discussions to have Mr S.P. excluded from the lunchroom. It further stated that he had used offensive and intimidating language towards and about employees of contractors.[3]

[6] Mr S.P. and Mr Flens are employees of MTCT Services Pty Ltd, commonly referred to as 'UGL'. At Esso's Longford site, some maintenance work is undertaken directly by Esso maintenance employees such as Mr Hatwell and Mr Gelagotis. These employees' employment is covered by the Esso Gippsland (Longford and Long Island Point) Enterprise Agreement 2017[4] (Onshore Agreement). Other maintenance work at Longford is undertaken by employees of contractors. Since 26 June 2017, UGL has been contracted by Esso to provide general, mechanical and electrical maintenance services to Esso, both at Longford and on its offshore platforms. UGL successfully bid for the relevant contract through a tender process initiated by Esso in 2016.

[7] The employment arrangements that apply at UGL have been the subject of controversy. UGL is a wholly owned subsidiary of UGL Operations and Maintenance Pty Ltd. Between September 2010 and July 2017, the contract to provide maintenance services to Esso was held by a joint venture company known as UGL Kaefer Joint Venture (UGLK). The work performed by UGLK's employees was covered by enterprise agreements that had been negotiated with the AMWU, CEPU and the Australian Workers' Union (AWU).

[8] In mid-2017, having won the tender for the maintenance contract, UGL made offers of employment to former employees of UGLK who had previously been engaged in undertaking maintenance work for Esso. The employment of UGL employees is covered by the NM Enterprise Agreement 2016[5] (NM Agreement). The unions are not covered by this agreement. It contains conditions that are in various respects less beneficial than those which were applicable at UGLK. Since 22 June 2017, the AMWU, CEPU and AWU have maintained a protest line outside the Longford site. Those on the protest line have discouraged former UGLK employees from accepting offers of employment with UGL. Some former employees of UGLK have however chosen to accept such offers. Among them are Mr S.P. and Mr Flens.

[9] Esso's reasons for dismissing Mr Hatwell and Mr Gelagotis relate generally to certain types of conduct that they were said to have engaged in towards employees of contractors. But they also relate to the particular events of two days.

[10] First, on 15 June 2017, there occurred a communications meeting of Esso maintenance employees in the lunchroom at Longford. During the meeting, there was a discussion about asking Mr S.P. to stop using the Esso employees' lunchroom. It is not in dispute that Mr Gelagotis raised this issue. Why he did so is contested. Although Mr S.P. was an employee of UGL, he usually ate his lunch in the lunchroom, and had done so for some years while he was employed by UGLK. After the communications meeting, Mr Gelagotis spoke with another Esso employee, Mr Lyndon, about the matter. Mr Lyndon, who was Mr S.P.'s friend, then asked Mr S.P. not to use the lunchroom. Esso concluded that Mr Gelagotis instigated Mr S.P.'s exclusion from the lunchroom because he had recently accepted employment with UGL. It also considered that Mr Hatwell, who chaired the communications meeting, was directly involved in the decision to exclude Mr S.P. from the lunchroom for this reason.

[11] Mr Gelagotis contends that he had legitimate reasons for excluding Mr S.P. from the lunchroom, which were unrelated to Mr S.P.'s acceptance of a UGL contract. Mr Hatwell contends that he simply chaired the communications meeting, during which a range of matters were discussed, and that he had no special involvement in or responsibility for excluding Mr S.P. from the lunchroom.

[12] Secondly, on the afternoon of 31 July 2017, there was an encounter between Mr Hatwell and Mr Flens in the workplace at Longford. Esso contends that Mr Hatwell approached Mr Flens and made the abusive statements referred to above. Mr Hatwell denies making these statements. UGL reported the matter to Esso. The company then commenced an investigation into Mr Flens' allegations.

[13] On 7 August 2017, Mr S.P. attempted to take his own life. He left a note which stated that a number of Esso employees, including Mr Hatwell and Mr Gelagotis, had 'incite(d) hatred, segregation (and) isolation between Esso workers and contractors' ('the note').[6] Esso commenced an investigation into Mr S.P.'s allegations.

[14] As a result of its investigations, Esso dismissed Mr Gelagotis, Mr Hatwell, and two other employees who were named in Mr S.P.'s note. It also issued final warnings to three other employees who were referred to elsewhere in the note.

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[15] The two applications were heard before me over five consecutive days from 29 January 2018. They were heard together, and evidence in the one was considered to be evidence in the other to the extent it was relevant. Thirty-seven witness statements were filed. Mr Gelagotis and Mr Hatwell gave evidence on their own behalf. The company led oral evidence from Mr Flens however Mr S.P. did not give evidence. He was not available to do so, on medical grounds.[7] Ms McMillan, Esso's human resources client contact, and Mr Zvirbulis, HR/IR manager for production, interviewed Mr S.P. and his wife (Mrs S.P) about the allegations in his note. A transcript of this interview was annexed to Ms McMillan's witness statement.[8] Mr S.P.'s wife filed a witness statement, and was to be available for cross-examination, but ultimately did not attend the proceedings. An affidavit was filed by a solicitor from Clayton Utz, Ms Winckworth, attaching the statement of Mrs S.P. Ms Winckworth deposed that she had spoken with Mrs S.P. on the telephone, and that Mrs S.P. had confirmed that the contents of her statement were correct.

[16] I make some preliminary remarks about the evidence.

[17] First, there was debate about what use the Commission should make of Esso's transcript of interview with Mr S.P. and Mrs S.P, and whether any regard at all should be had to Mrs S.P.'s statement. I accepted the affidavit of Ms Winckworth, and the transcript of Esso's interview with Mr S.P. and Mrs S.P., and indicated that I would give consideration to the parties' submissions as to the weight I should accord to them.

[18] The applicants acknowledged in their closing submissions that the Commission could have regard to Esso's interview with Mr S.P. and Mrs S.P., because of Ms McMillan's sworn evidence about it. They contended however that Mr S.P.'s answers should not be regarded as sworn evidence, but rather as untested, and given less weight accordingly. In relation to the witness statement provided by Mrs S.P., the applicants contended that she had originally made herself available for cross-examination, and then on the day for her to appear in the Commission had tendered a medical certificate stating only generally that it would be detrimental for her to attend the proceedings. The applicants submitted that, unlike the position in relation to Mr S.P., there was no material that explained the basis for the doctor's conclusions, and it was therefore not established that Mrs S.P. was unavailable to give evidence. Had the Evidence Act 1995 (Cth) applied, it is doubtful that her statement would have been admissible, although there is a basis for a contrary contention in light of the evidence of Ms Winckworth.[9]

[19] Esso relied on the evidence of both Mr S.P. (through the transcript attached to Ms McMillan's statement) and Mrs S.P. (through Mr Winckworth's affidavit) in relation to the allegations that Mr Hatwell and Mr Gelagotis engaged in 'conduct designed to ignore, exclude and isolate employees of contractors on site', and that they used 'offensive and intimidating language towards and about employees of contractors.'

[20] I have had regard to the evidence of Mr S.P., but have relied on it only to a limited extent in making my factual findings. Mr S.P.'s note is clearly relevant, as it prompted one of Esso's investigations. The applicants did not object to the Commission's use of the existence of the note as a relevant fact, but contested the truth of the statements contained in the note. However, Mr S.P.'s information is not relevant to Mr Hatwell's interaction with Mr Flens, or to what occurred during the communications meeting on 15 June 2017. As to the evidence of Mrs S.P., I have not relied on it in reaching my findings of fact.

[21] The conduct of Mr Hatwell and Mr Gelagotis that I have found below to be substantiated is based on the evidence of the applicants, Mr Flens and the other UGL witnesses, Esso employees who were present at the communications meeting, and evidence of the surrounding circumstances. Where there is a contest on the evidence as between particular witnesses (in particular, Mr Hatwell and Mr Flens), I will explain below whose evidence I prefer and why.

[22] Secondly, the applicants objected to certain evidence about the industrial context of the present matter. In particular, objections were made to certain paragraphs of Ms McMillan's statement about activities on the protest line outside the Longford site. The objections were based principally on relevance. I have received this evidence - 'admitted' seems inapt to say, in the setting of a tribunal not bound by the rules of evidence under its statute. I have done so because I considered it to be relevant. Evidence of circumstances surrounding facts at issue can provide a basis for drawing logical inferences. However, I emphasise that the applicants were not said to have been involved in the protest line. I note also that the applicants elsewhere contended that the broader context was relevant to the question of harshness, and that the industrial disputation associated with UGL's employment arrangements was dividing the workplace and had created tension.[10]

[23] Thirdly, it should be noted that the applicants' direct evidence has four primary sources: the answers they provided to Esso during its investigations, the transcript of which was put in evidence before the Commission; the applicants' initial witness statements prepared for these proceedings; their subsequent 'reply' statements; and their oral evidence before the Commission. Esso contended that the accounts provided by the applicants were not consistent and in various respects dishonest. The applicants rejected this, and contended that any differences between the accounts of each of the applicants are explainable, including because of the generality of the allegations first put to them by Esso. In the course of setting out my factual findings in these reasons, I will address certain inconsistencies in the applicants' evidence, particularly in relation to the evidence of Mr Gelagotis.

[24] Fourthly, I note more generally that, as an administrative, quasi-judicial tribunal, the Commission is required to take into account relevant considerations, and to ignore irrelevant considerations.[11] Relevant considerations are found in 'material which tends logically to show the existence or non-existence of facts relevant to the issue to be determined.'[12] If the material has probative value the weight to be attached to it is a matter for the decision-maker. The Commission should consider and carefully weigh all relevant material, including circumstantial evidence, and where appropriate draw reasonable inferences.

[25] Finally, the Commission is not bound by the rules of evidence,[13] although it tends to follow them.[14] Hearsay may be relied on if it is shown to be probative of a fact in issue, however it would not ordinarily be relied on if the opposing party is denied an opportunity to contradict the material by presenting contrary evidence.[15] Ultimately, the Commission is obliged to perform its functions in a manner that is fair and just.[16]

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[27] These applications concern dismissals for misconduct which occurred in a particular industrial context. This context needs to be considered simply in order to understand the parties' competing contentions. The context may also be evidentially relevant, such as for the purposes of drawing inferences. At the same time, the applicants rightly contend that the focus of the Commission's consideration of the applications must be on what Mr Gelagotis and Mr Hatwell actually did.

[28] Mindful of this, I proceed briefly to address the broader commercial and industrial background, before turning to the particular allegations against the applicants and my consideration of whether they are substantiated. In summarising chronologically the industrial background, I make brief reference to other significant incidents, as the sequence of events will be of relevance.

[29] In January 2017, Esso awarded a five year contract to UGL to undertake maintenance services at Longford. It announced the award of the contract to Esso employees and union delegates in February 2017.[17] From March to May 2017 there were certain negotiations between UGL and the unions for an enterprise agreement to cover the employees who would perform the work under the new contract.[18] The unions' position was that the terms and conditions of a new enterprise agreement should reflect the conditions previously afforded to UGLK employees.

[30] Esso's position is that in May 2017, the unions commenced an 'industrial campaign' against it and UGL. On 19 May 2017, Mr Mooney, CEPU organiser, sent a text message to a UGL employee stating 'War is coming.'[19] The text message contained a hyperlink to an ETU (CEPU) Facebook post of the same date that shared a Gippsland Times news article entitled 'contractor wants to reduce offshore wages'.

[31] On 29 May 2017, the ETU, AMWU and AWU sent a message to members, bearing the logos of each union and providing contact information for relevant organisers, stating (amongst other things):

[12]

[32] In my view it is clear that the unions attempted to discourage UGLK employees from accepting UGL's offers of employment.[21] Their position was that no member should accept the job offer and that to do so was a 'sell out'.[22]

[33] On 9 June 2017, Mr S.P. signed an offer of employment with UGL.[23]

[34] On 14 June 2017, Mr Matthew McDonald, an Esso maintenance employee and AMWU delegate, sent an email concerning the employment arrangements at UGL to Esso maintenance and operations employees, including Mr Hatwell and Mr Gelagotis.[24] It attached clauses from a UGL enterprise agreement for distribution to 'all offshore Esso employees so they understand the position UGL-K employees are in, which will at some point affect all Esso Employees.' The email stated that 'the three Unions are not letting this slip they have got media campaigns well underway and a visual presence will come soon enough'. It further stated that the three unions 'reiterate to all UGL-K members not to sign this crap deal because you would be selling 25 years of hard fought conditions down the drain.'

[35] On the following day, 15 June 2017, the communications meeting referred to above took place, at which there was discussion about asking Mr S.P. not to use the Esso employees' lunchroom. I examine the events of that day further below.

[36] On 20 June 2017, employees of Esso at Longford stopped work,[25] evidently in support of a union rally against UGL and Esso that had been organised in Melbourne that day.[26]

[37] On 21 June 2017, Esso investigated the previous day's walk off and interviewed participants for the purposes of potential disciplinary action. Mr Hatwell lodged a harassment complaint against Ms McMillan in respect of her interview with a Mr Alex Loppardi, an Esso mechanical fitter. Mr Hatwell claimed that Ms McMillan breached Esso's harassment policy during this interview.[27] This was the second time Mr Hatwell had initiated a complaint under Esso's harassment policy, the first being in 2015 when Mr Hatwell alleged breaches of the policy by the Longford plant manager.[28]

[38] On 22 June 2017 a protest line appeared near the entrance to the Longford site. Union flags were placed along the perimeter of Garretts Road, adjacent to the Longford site.[29] A group of people gathered, including former UGLK workers who had not accepted employment with UGL.[30] Officials of the CEPU, AWU and AMWU were also present.[31]

[39] Photographs produced to the Commission showed the presence of slogans and statements such as 'Stop Esso's UGLy plan'. Such references appeared on union social media pages.[32] A dedicated Facebook page entitled 'Esso/Longford UGLy dispute' was created.[33] In my view it is clear that the protest line was organised by the unions.[34]

[40] On the same day that the protest line emerged, Mr Andre Kostelnik, the Longford Production Operations Manager, sent an email to all Esso employees and contractors concerning Esso's Harassment Policy. It contained a hyperlink to the full policy, and relevantly stated:

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[43] On 3 July 2017 a very large inflatable rat appeared outside the entrance to the Longford site.[38] A sign appeared stating 'Don't be Scabby the Rat.' Another sign listed the names of those who had accepted UGL offers of employment.[39] Among those named were Mr S.P.[40] and Mr Flens,[41] as well as Mr Henness, UGL's mechanical supervisor, and Mr Little, a UGL mechanical fitter.[42] Photographs of the above were tendered in evidence before the Commission.[43]

[44] There was evidence that some people on the protest line had shouted at UGL employees who drove through on their way to or from work,[44] using language such as 'dick head', 'scab,' 'dog', 'grub', 'scum' or 'coward'.[45] There was evidence that some had hit cars with placards[46] and approached cars with UGL employees inside, pointing at them and calling out 'scab'.[47] Mr Henness gave evidence that he was stopped in a line of traffic held up by the picket line and approached by two people who opened his car door and said 'I know where you live and I know where your family are, we know what you've been doing and we'll be watching you'.[48] I reiterate that the applicants were not said to have been involved in the protest line.

[45] On 21 July 2017, the Federal Court issued orders against the three unions and three officials of those unions, requiring them to remove the inflatable rat and the signs naming the persons who had accepted employment with UGL.[49] The orders also prohibited the unions from threatening, obstructing, harassing or intimidating UGL employees.

[46] Esso led evidence of various instances of inappropriate behaviour about or towards UGL employees since 2017 (aside from the conduct of the applicants that is at issue in these proceedings). Esso believes, but cannot prove, that Esso employees have been involved in the following: unexplained blocking out of UGL employees' communication over site radios;[50] inappropriate graffiti and signage appearing in the workplace referring to UGL employees, including pictures of the inflatable rat;[51] and a painted sign appearing with the words 'Humans Only, No Scabs'.[52] However, these matters have not been explained. It is not necessary or appropriate to delve into these various allegations. The focus of these proceedings must remain on the conduct of the applicants, and so much of the surrounding circumstance as can be safely proved.

[47] Esso contended that Mr Gelagotis and Mr Hatwell were part of a union 'campaign' against UGL and employees who accepted contracts with it. The applicants contended that it has not been established that there was such a campaign or that they had any part in it. In my view, it is not necessary for me to determine whether the union's position and conduct in relation to the UGL employment arrangements constituted a 'campaign'. The evidence of the applicants and certain other witnesses addresses their understanding of the unions' position; this can speak for itself, without the overlay of any characterisation. I consider this evidence below. I note that the applicants' submissions summarise the broader context as follows: UGL invited the former UGLK workforce to re-apply for their former jobs on inferior terms and conditions, including significantly lower wages; and that in response, an ongoing protest camp was established outside the Longford site from late June 2017.[53]

[48] It has not been alleged that either Mr Hatwell or Mr Gelagotis had any responsibility for the behaviour of any person on the protest line or the conduct of the protest line more generally. The activities on the protest line are relevant to the context in which the allegations against the applicants were made. Whether Mr Hatwell and Mr Gelagotis supported the position of the protestors and the unions is a question of relevance. However, their conduct is not to be judged by the behaviour of others.

[49] Finally, it is uncontroversial that in the months of June and July 2017, the working environment between Esso maintenance employees and contractors at Longford was tense, and that this tension was related to the industrial disputation between UGL and the former employees of UGLK and their unions.

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[50] On Monday 7 August 2017, UGL's site superintendent, Mr Frank Tabone, reported to Esso Mr Flens' allegation about his encounter with Mr Hatwell on 31 July 2017, during which Mr Flens claimed that Mr Hatwell had called him a 'fucking scab.'[54]

[51] Later that day, UGL made a further report to Esso, stating that another UGL employee, Mr S.P., had attempted to take his own life. On 8 August 2017, Esso was provided with a copy of Mr S.P.'s note, in which he stated that certain Esso employees, including the applicants, had 'incite(d) hatred, segregation, isolation between Esso workers and contractors'.[55]

[52] Ms Kirsteen Butler, Esso's human resources manager, gave evidence that on 8 August 2017 she commenced an investigation in relation to the allegations of Mr Flens. The same day, Mr Flens was interviewed by Ms McMillan and Ms Smith. The interview was transcribed.[56] Ms Butler later directed Ms McMillan and Mr Zvirbulus to investigate the allegations in Mr S.P.'s note. Ms Butler ultimately merged the two investigations, as both concerned allegations of mistreatment of UGL employees by Esso employees.[57]

[53] Esso was not immediately able to speak to Mr S.P. concerning the allegations in his note, due to his medical condition. Ms Butler gave evidence that she decided that the appropriate course of action was to suspend the seven employees referred to in Mr S.P.'s note on full pay until Esso could better understand what may have occurred.[58]

[54] On 9 August 2017, Mr Hatwell, Mr Gelagotis and four of the other five Esso employees referred to in Mr S.P.'s note were suspended. The other named employee was suspended on 10 August 2017. Mr Hatwell and Mr Gelagotis received letters from Mr David Anderson, the plant manager, stating that they were suspended while the company investigated allegations concerning 'possible harassment of UGL contractors'.[59] The letters did not refer to Mr S.P., Mr Flens, or any particulars of the alleged harassment. Mr Hatwell gave evidence that after he was stood down, he received some emails from Esso concerning allegations made by Mr Flens however he did not know what those allegations were.

[55] On 10 August 2017, Mr Frank Casella, an Esso operator, sent a text, apparently mistakenly, to Mr Mick Triantafyllou, the Esso safety coordinator, saying:

[21]

[56] According to Mr Triantafyllou, on 14 August 2017 Mr Casella said to him that the message was sent by mistake, that he should delete it and that it 'had nothing to do with the current situation of bullying.'[61] I note that the applicants objected to a paragraph in Ms Smith's statement referring to this matter; however Mr Triantafyllou gave direct evidence of it through his statement, and he was not required for cross-examination. I consider it to be of some relevance to the industrial context, although my findings do not rely on it.

[57] On 15 August 2017, Mr Hatwell was interviewed by Ms Smith and Mr Peter McMillan from Esso in relation to the allegations made by Mr Flens. Mr Hatwell was accompanied by Mr Mooney, ETU Organiser. The interviewed was transcribed.[62]

[58] On 30 August 2017, Mr Hatwell attended a second interview with Ms McMillan and Mr Zvirbulus, accompanied by Ms Weber, an ETU lawyer. Before the start of the interview, Mr Hatwell was given a document headed 'summary of issues', which referred to 'allegations that [Mr S.P], UGL contractor, was harassed, bullied and intimidated by Longford Plant employees.' It stated that the subject of investigation included the 'manner of interactions between Esso employees and [Mr S.P.] and [Mrs S.P]. before and after the UGLK to UGL contract change over; allegations of [Mr S.P.] being excluded from the maintenance lunchroom by Esso employees; conduct of Esso employees when interacting with [Mr S.P.] at the tool store; and Esso employees engaging in conversations about 'scabs', rats', 'dogs' or similar terms'.[63] The interview was transcribed.[64]

[59] On 31 August 2017, Mr Gelagotis was interviewed by Mr Zvirbulus and Ms McMillan about the allegations raised by Mr S.P. Mr Gelagotis was accompanied by Mr Barry Terzic from the AMWU. The interview was transcribed.[65]

[60] On 12 September 2017, Mr S.P. and Mrs S.P. were interviewed by Ms McMillan and Mr Zvirbulus. As noted earlier, that interview was also transcribed.[66] Mr S.P. and Mrs S.P. provided certain additional details of the allegations raised in Mr S.P.'s note. I address some of this evidence further below.

[61] From August to October 2017, Mr Zvirbulus and Ms McMillan conducted some 24 interviews, including with the other Esso employees named in Mr S.P.'s note, in relation to the allegations raised by Mr S.P.[67]

[62] On 17 October 2017, Mr Hatwell and Mr Gelagotis each received a letter from Ms Butler, setting out formal allegations to which they were asked to respond.[68] The letter to Mr Hatwell stated:

[42]

[71] The 'level of comfort' referred to means that the finder of fact must 'feel an actual persuasion of the occurrence or existence of the fact in issue'; the 'mere mechanical comparison of probabilities independent of a reasonable satisfaction will not justify a finding of fact.'[86]

[72] Although there was broad agreement about the principles applicable to the standard of proof and evidence, there was some disagreement as to how these principles applied in the present case. Esso contended that here it sought to prove that the applicants' conduct had breached its policies: there is no question of fraudulent or criminal conduct. It contended that, if allegations attracting the Briginshaw standard were placed on a spectrum, this case would be set at a 'low level'.[87]

[73] The applicants submitted that they are accused of serious misconduct, and that the courts have recognised that employees enjoy the presumption that ordinarily employees do not commit serious misconduct.[88] They say that this presumption is not lightly rebutted. The applicants, like Esso, submitted that the evidence must actually persuade the Commission that the alleged conduct occurred, but contended that the alleged conduct is serious, not a mere breach of policy.

[74] In considering whether there is a valid reason for termination, it is not ordinarily necessary for the Commission to determine whether the conduct was sufficiently serious to constitute serious misconduct. In the present matter, there is a question about whether, if the conduct fell short of serious misconduct, the company was required to apply the procedure in clause 22 of the Onshore Agreement, and how this affects the fairness or otherwise of the dismissals. I deal with this further below.

[75] I agree with the applicants' contention that they have been accused of serious misbehaviour, and that this affects the application of Briginshaw. Irrespective of whether their behaviour constituted serious misconduct, the applicants were summarily dismissed in connection with serious allegations concerning mistreatment of employees of contractors on site. I do not accept Esso's contention that the present matters warrant the application of a 'low level' on the Briginshaw 'spectrum'. Of course, this does not mean that Esso carries a higher or criminal standard of proof.

[76] I note that the Act requires me to consider whether in each of these two matters there was a valid reason for dismissal. Where several reasons for termination are invoked, it is not necessarily the case that all must be substantiated. Further, it is well-established that a valid reason need not necessarily be the one relied upon by the employer. Esso has invoked several valid reasons connected to the conduct of each of Mr Hatwell and Mr Gelagotis.

I shall now examine them to determine whether I am actually persuaded that the applicants committed some or all of the relevant conduct, and whether any such conduct constitutes a valid reason.

[44]

[77] The termination letter given to Mr Hatwell on 30 October 2017 stated that Esso's investigations had concluded that his behaviour and conduct was not acceptable and contributed to creating a hostile and intimidating working environment, in breach of the Company's Harassment in the Workplace Policy.

[78] In their final written submissions, Mr Hatwell and Esso each addressed the reasons for dismissal set out in the termination letter (see [65] above), but in different ways, apparently reflecting different interpretations of it. Esso addressed two reasons for Mr Hatwell's dismissal, which were stated generally and then particularised in the letter as follows: that he was directly involved in the decision to exclude Mr S.P. from the lunchroom, and that he abused Mr Flens in the manner alleged.[89]

[79] Mr Hatwell's submissions understand the reasons for dismissal to be fourfold. In his final submissions, Mr Hatwell addresses as a separate reason for dismissal 'conduct designed to ignore, exclude and isolate employees of contractors'. He submits that this 'generalised and ambiguous statement' did not reflect specific conclusions about discrete acts of alleged misconduct contained in the allegations letter.[90] The termination letter also refers generally to Mr Hatwell using offensive language towards and about employees of contractors. I agree with Mr Hatwell that the termination letter can be read as identifying as reasons for dismissal conduct of a general kind, going beyond the particulars concerning the incident with Mr Flens and the exclusion of Mr S.P from the lunchroom. This general conduct was not the focus of the proceedings, but I shall deal with it briefly.

[80] In its final submissions Esso did not appear to press any contention that Mr Hatwell engaged in conduct designed to ignore, exclude and isolate employees of contractors, other than in relation to Mr S.P. I note that Mr Henness had said in his statement that on 31 July 2017, Mr Hatwell did not acknowledge or make eye contact with him. However, this is one allegation of conduct on a single day, and in my view there is nothing to suggest that Mr Hatwell would ordinarily have engaged with Mr Henness.

[81] To the extent that Esso maintained any broader allegation that Mr Hatwell ignored or excluded, or gave the 'cold shoulder' to Mr Henness or contractors more generally, I find it unsubstantiated.

[82] As to the proposition that Mr Hatwell ignored Mr S.P., the reliable evidence is scant. During his interview with Ms McMillan and Mr Zvirbulis, Mr S.P. said, in response to a prompt from his wife as to whether Mr Hatwell was dropping his head, 'Hats was yeah, he wouldn't even look at me, yeah.'[91] This is of course a very general allegation. It is not known how often the conduct is said to have occurred, or what the circumstances of the various occasions are said to have been. Did Mr S.P. claim that Mr Hatwell would walk right past him and look away; or speak to him in the tool shed where he worked but not look at him while doing so? Or that Mr Hatwell just avoided him? It is not known whether Mr S.P.'s statement is a reflection of perception or fact. Nor is it possible, assuming it were to be a fact, to assess how serious the conduct was.

[83] Against this the Commission has heard Mr Hatwell's sworn evidence. He explained in his second witness statement that he had very little interaction with Mr S.P. He denied deliberately dropping his head or avoiding eye contact with Mr S.P.[92] He stated that he had no idea how Mr S.P. could believe that he had done so.[93]

[84] In my opinion, the proposition that Mr Hatwell ignored Mr S.P. is not substantiated.

[46]

[85] Esso contends that Mr Hatwell was directly involved in a decision to exclude Mr S.P. from the Esso maintenance lunchroom, and that this constitutes a valid reason for his termination.[94]

[86] It is necessary to examine the evidence of the circumstances surrounding Mr S.P. being asked not to use the lunchroom. It was common ground that on 15 June 2017 there was a communications meeting with Esso maintenance employees involving some 40 to 50 employees, and that Mr Hatwell was the chair of the meeting. Mr Hatwell's evidence was that the purpose of the meeting was to provide Esso employees with feedback on recent delegates' meetings, as well as an update on Federal Court proceedings.[95]

[87] It is also uncontested that during the communications meeting, the situation of Mr S.P. was raised. Mr Hatwell gave evidence under cross-examination that he understood the question at issue to be whether Mr S.P. should be excluded from the Esso maintenance lunchroom.[96] It will be recalled that Mr S.P. had signed a contract with UGL six days earlier_._ Mr Hatwell and Mr Gelagotis said that by the time of the communications meeting, they knew that Mr S.P. had accepted an employment offer with UGL (although in cross-examination Mr Hatwell said he did not officially know this until 23 June 2017).[97]

[88] It will also be recalled that the communications meeting occurred one day after Mr McDonald sent an email to Esso maintenance union members stating that the three unions 'reiterate to all UGL-K members not to sign this crap deal because you would be selling 25 years of hard fought conditions down the drain.'[98] Mr McDonald attended the communications meeting and took brief notes of topics discussed. His notes record one topic of discussion being 'UGL feedback'.[99]

[89] Mr Hatwell was asked in cross-examination about this reference in Mr McDonald's notes. He said that there had been discussion about the fact that no agreement had been reached between the unions and UGL and that the negotiations had not progressed.[100] Another issue recorded in Mr McDonald's notes was 'Issue raised, contractors in lunchroom, comments around what does the sign say on the door'.[101]

[90] It is not contested that Mr Gelagotis proposed that S.P. not be allowed to use the Esso employees' lunchroom. Precisely what Mr Gelagotis said, and why he said it, is contested. As I discuss further below, Mr Gelagotis gave evidence to the Commission that he had a number of reasons for raising this issue at the communications meeting. He stated that he believed that all contractors should be asked not to use the lunchroom; and that, as two former apprentices had been asked to leave earlier in the year, it would be fair to ask Mr S.P. to leave also. His evidence was that the lunchroom was for Esso maintenance workers to discuss work and industrial matters. And he gave evidence that he was concerned about allegedly threatening statements that Mr S.P. had made, and that he did not want something bad to happen. Mr Gelagotis told the Commission that during the communications meeting, he raised concerns about the risk of violence if Mr S.P. continued to use the lunchroom. I return to these explanations further below in considering whether there was a valid reason for Mr Gelagotis' dismissal.

[91] When Mr Gelagotis was first interviewed by Esso about the communications meeting, he said that he had made a comment about Mr S.P.'s presence in the lunchroom, and that, given the two apprentice-contractors had been asked to leave earlier in the year, 'if the shoe fits for one it should fit for all'. Mr Gelagotis said in the interview that his comment was directed at all contractors, although there do not appear to have been other contractors using the lunchroom at that time. Of relevance to the position of Mr Hatwell was that Mr Gelagotis told the Esso representatives in his first interview that there had been a 'motion' ('my motion') in relation to this matter,[102] and that there was 'something granted'.[103] This suggested to Esso that a decision was taken at the meeting that Mr S.P. should be excluded from the lunchroom. For Esso, this had particular implications for the culpability of Mr Hatwell, given his role as chair of the meeting.

[92] When Mr Hatwell was interviewed by Esso about the communications meeting, he said that Mr Gelagotis raised the issue concerning Mr S.P.'s presence in the lunchroom, and that he understood that someone had later told Mr Robert Lyndon about the matter, who had in turn asked Mr S.P. not to use the lunchroom. This too will be discussed further below.

[93] It is clear that there was a discussion at the meeting about the issue raised by Mr Gelagotis. It lasted for 5 to 10 minutes.[104] Mr Hatwell stated that neither he nor the broader group made any decision about Mr S.P.'s presence in the lunchroom.[105] He stated that usually, if a decision is to be made, a vote occurs to ensure that members support it; however on the question raised by Mr Gelagotis, there was no vote. He said that he had no further discussions with anybody about Mr S.P. or the lunchroom until after he was suspended on 9 August 2017. Mr Hatwell maintained that the role he played at the communications meeting was simply to chair it, as the ETU delegate.[106]

[94] In cross-examination Mr Hatwell said as follows:

[58]

[97] Esso contended that regardless of the formality or otherwise of the decision-making process, the Commission ought to conclude that Mr Hatwell was actively involved in a decision or process to 'grant' (to use Mr Gelagotis' word) the exclusion of Mr S.P. from the lunchroom. Mr Hatwell was the ETU delegate. He chaired the meeting. For Esso, he must bear some responsibility for the conduct of the meeting and the things that occur as a result of the meeting. Esso submitted that, at the least, the process followed in the meeting led inevitably to steps which meant Mr S.P. was to be excluded from the lunchroom, and that Mr Hatwell agreed with the proposed course of action and did nothing to stop this.

[98] However, in my view, the evidence does not establish that Mr Hatwell played a significant role in excluding Mr S.P. from the lunchroom. He chaired the meeting and was involved in the discussion of this issue. He understood the proposal to be that UGL contractors should be asked not to use the lunchroom. The only contractor identified at that point was Mr S.P. Mr Hatwell was not opposed to the proposal. However he did not have all the information and so 'wasn't going to act on it.'[115] I accept this evidence.

[99] Mr Hatwell could perhaps have used his authority and influence (the extent of which is not established) to prevent further discussion of Mr S.P.'s exclusion from the lunchroom, but did not do so. Whether he should have done so brings into consideration the question of the legitimacy of the request to ask Mr S.P. not to use the lunchroom, which I consider in detail further below in assessing the conduct of Mr Gelagotis. As I will later explain, in my opinion it was not legitimate. However, I am not persuaded that Mr Hatwell's role in the exclusion of Mr S.P. from the lunchroom was significant.

[100] Mr Hatwell did not instigate, organise or encourage the proposed exclusion of Mr S.P from the lunchroom. He understood that a proposal had been raised to exclude Mr S.P. from the lunchroom,[116] and that there was a concern about UGL contractors in the lunchroom.[117] He was not opposed to what had been raised. His failure to take any action to stop the proposal being acted upon was deserving of censure. But it is not established that Mr Hatwell had any active role in raising or implementing the proposal. In my view, the allegation that Mr Hatwell was 'directly involved in a decision to exclude Mr S.P. from the lunch room' is not substantiated.

[97]

[107] UGL employees had taken the place of UGLK employees. Some former UGLK employees, such as Mr Flens and Mr S.P., had taken up employment with UGL. They had not taken the jobs of Esso employees. And the evidence establishes that Esso and UGLK maintenance employees generally had little interaction and worked separately.[123] However, there had been statements of concern about UGL employees potentially taking the jobs of Esso employees. It was put to Mr Hatwell in cross-examination that the conditions of employment being offered at UGL did not affect Esso employees' conditions, to which Mr Hatwell said 'not directly'.[124] He said that there was 'potential down the track that there wouldn't be more Esso guys hired if the contract guys were at a lower rate.'[125]

[108] Mr Hatwell gave evidence that he was concerned from the way in which Mr Flens had responded to him that the generator might be used without first being tested.[126] Such testing had to be undertaken by an electrical worker.[127] Mr Aitken, who heard this part of the conversation, gave evidence that he had the impression from the way Mr Flens said 'it's just a plug in' that Mr Flens did not think an inspection was required before he (Mr Flens) ran the generator.[128]

[109] An abusive statement is not necessarily concerned with factual accuracy, but with making a point. For example, on any view Mr Flens was not doing literally every person's job. That does not make the statement 'you're doing every cunt's job now' unlikely. However, one would expect an abusive statement such as this to have some notional factual or circumstantial reference point. It would be enough that he was doing one other person's job for the abusive statement to 'make sense'. In my view, there was no legitimate reason for Mr Hatwell to say to Mr Flens that he was doing 'every cunt's job'. However, there was a reference point for such a statement. The imputation could quite realistically have been that Mr Flens was doing a former UGLK employee's job, or an Esso maintenance employee's job (in by-passing the required testing, or as Mr Flens conjectured, running continuity leads); or more generally that he was doing work that was beyond his remit, namely setting up a generator to use it, or allow it to be used, without the necessary checks.

[110] Mr Hatwell also contended that he had no reason to abuse Mr Flens for trading off his RDO, when factually Mr Flens had not traded it off. It was contended that Mr Hatwell had no specific knowledge of the terms and conditions of those who had accepted employment with UGL,[129] and that the evidence showed that Mr Flens did have an RDO entitlement but was working, and for doing so acquired a day in lieu.[130] It was contended that Mr Hatwell therefore had no reason to say to Mr Flens 'Oh, you're working your RDO today, oh, that's right, you fucking traded that off, you haven't got an RDO, have you? You're a fucking scab.'

[111] However, in the circumstances, the fact that Mr Hatwell had no specific knowledge of UGL conditions does not tell against him having made an abusive statement about RDO's. Mr Hatwell says he asked Mr Flens if it was an RDO, as it would have explained why no one else was there, and Monday was a common day for an RDO.[131] In my view, it would have been reasonable for Mr Hatwell to think that Mr Flens might be working because he did not have an RDO entitlement. There was reason enough for Mr Hatwell, on his own evidence, to raise the issue of an RDO. This provides a reasonable reference point for an abusive statement concerning the working of RDO's. As noted above, it does not matter whether the abusive statement was true or not, as an abusive statement is not necessarily concerned with factual accuracy, but with making a point in a way that makes sense.

[112] For Mr Hatwell, it was contended that there were several other aspects of Mr Flens' evidence that should lead the Commission to prefer Mr Hatwell's version of events.

[113] First, in his interview with Esso (but not mentioned in his statement), Mr Flens said that when Mr Hatwell walked past him and called him a scab, he was six metres away, and that Mr Flens was wearing both ear plugs and ear muffs in a noisy environment.[132] Mr Flens also stated that he and Mr Hatwell moved further apart from one another. It was suggested to Mr Flens in cross-examination that he had not heard properly, and that Mr Hatwell had simply asked him about whether it was an RDO.[133]

[114] Mr Flens rejected the suggestion that he misunderstood Mr Hatwell. He said that Mr Hatwell had not simply asked if it was an RDO. Mr Flens conceded that it was a noisy environment, and did not seek to downplay the distance between himself and Mr Hatwell. He explained that although he was wearing ear protection, 'we talked, we have to talk, you elevate your voice to talk.'[134] In this regard, I note that Mr Flens evidently had no difficulty hearing Mr Hatwell's reference to RDO's, which Mr Hatwell acknowledges he made. There is no reason to think that he was not able to hear the rest of what was said. There was no indication in the evidence that Mr Flens was having difficulty hearing or understanding Mr Hatwell.

[115] Secondly, it was contended that Mr Flens' evidence of what Mr Hatwell said to him was not consistent with the evidence of those to whom Mr Flens reported the matter. The investigation concluded that Mr Hatwell called Mr Flens 'dog', 'scab', 'grub' and 'scabby contractor', based on the reports from Mr Henness, Mr Tabone, Mr Little as well as Mr Flens. The evidence of these other witnesses was that Mr Flens told them that Mr Hatwell called him a grub for trading in his working conditions (Mr Little);[135] a 'scabby contractor' and a 'grubby cunt' (Mr Henness);[136] and a 'dog' and a 'scab' (Mr Tabone).[137] It was submitted for Mr Hatwell that Mr Flens' story has grown in the telling.

[116] However, Mr Flens' own evidence of the words used by Mr Hatwell was clear and consistent. Mr Flens did not seek to modify his account of events to accommodate the evidence of others. Rather, Mr Flens said simply that the other witnesses can give their evidence, and he will give his.[138] The fact that others reported Mr Flens using different words may reflect their different recollection of what Mr Flens recounted to them. In this regard, it will be recalled that a variety of abusive epithets have been used at Longford. For a person to whom an incident is reported, it may not be of great significance which particular word is used. For example, Mr Little said in his statement that Mr Flens told him on 31 July 2017 that Mr Hatwell had just called him a 'grub or scab for trading in or working his RDO'.[139] For Mr Little the detail was not personal; it was of less significance to him whether the word used was grub or scab, both of which had been used on site. But for a person at whom it is directed, words of abuse would ring in his ears. Mr Flens would be more likely to remember the words accurately, and Mr Flens' account has been unwavering.

[117] Thirdly, it was contended that Mr Flens' evidence about the physical contact with Mr Hatwell changed when he was pressed about it, and that he began to downplay it. This is not how I perceived it. In his interview with Esso, Mr Flens said that Mr Hatwell tapped him on the arm with the back of his hand.[140] In cross-examination he referred to 'physical contact', and also used the word 'bumped'.[141] He did not in my view seek either to emphasise or downplay the contact. It was contended for Mr Hatwell that Mr Flens did not re-iterate in oral evidence his earlier statement that he 'could smell Mr Hatwell's breath' because he was so close.[142] I do not see that as significant.

[118] Fourthly, Mr Aitkens' evidence was that he didn't observe any contact or close interaction between Mr Hatwell and Mr Flens.[143] He also said that he did not hear Mr Hatwell use the words that Mr Flens attributes to him, but was able to overhear the conversation between them about who plugged in the generator.[144] However, Mr Aitken admitted that he was not watching the two men all the time.[145]

[119] Further, in cross-examination, Mr Flens stated that the conversation between him and Mr Hatwell ended with Mr Hatwell saying 'We'll see about that,' until Mr Hatwell later passed him by and called him a 'scab'.[146] Mr Hatwell contends that this conflicts with the account of the conversation Mr Flens provided in his statement. There, he says that that part of the conversation finished with 'You're doing every cunt's job now'. Moreover, there was no mention in the statement of 'We'll see about that'. However, I do not consider these to be significant discrepancies.

[120] Mr Hatwell also submitted that there is no evidence of his saying or doing anything like what Mr Flens attributes to him on any previous occasion, and that on Mr Flens' evidence, this was a one-off. I accept this. There is certainly no evidence of Mr Hatwell abusing anyone else in the manner alleged.

[98]

[121] There is a direct conflict between the evidence of Mr Flens, who says that Mr Hatwell called him a 'fucking scab' and otherwise abused him as set out above, and Mr Hatwell who flatly denies it. I accept the evidence of Mr Flens over that of Mr Hatwell for the following reasons.

[122] First, Mr Flens was in my assessment a credible and convincing witness. He made appropriate concessions. He did not seek to answer questions strategically, but simply and spontaneously. He gave frank and direct answers to questions under cross-examination. In the course of Mr Flens' evidence, he turned to me and said, in reference to his conversation with Mr Hatwell, 'I was told I was a fucking scab'.[147] In my judgement, Mr Flens was telling the truth. Further, from his tone of voice and demeanour, I consider that he found these words to be very upsetting.

[123] Mr Hatwell contended that Mr Flens appeared to downplay the effect of the treatment he had received on the protest line.[148] On Mr Hatwell's argument, this is significant, as it goes to what he says might be Mr Flens' motivation to make false allegations against him (I will return to this question below). It would be a reasonable human reaction to find treatment of the kind to which Mr Flens has been subjected on the protest line upsetting. In addition to having his name appear on the sign 'employee of the week' next to 'scabby the rat',[149] Mr Flens has been subjected to various abuse. He has had eggs thrown at his car. His tyres have been punctured.[150] However, I do not agree that Mr Flens downplayed his mistreatment on the protest line or the effect it has had on him. Mr Flens described the relevant conduct in detail in his witness statement.[151] He accepted that the personal effect of this mistreatment had been upsetting 'to a degree'.[152] He did not specify to what degree he found it upsetting, and this answer in my view reflected his stoic disposition. However, this does not tell against the reliability of his evidence.

[124] Secondly, Mr Hatwell had a motive to abuse Mr Flens, namely because he had accepted employment with UGL. The motive is established by reference to circumstantial evidence and Mr Hatwell's own evidence. It explains why Mr Hatwell might have said the words attributed to him by Mr Flens. Mr Hatwell acknowledged that he agreed with the union's position that former UGLK employees should not accept employment with UGL.[153] Mr Flens was a former UGLK employee who had done just that. Mr Hatwell did not think it was right that UGL had offered employment on lower conditions than those which applied at UGLK.[154] Mr Hatwell acknowledged that as a delegate, he upheld the ETU position on site amongst the electricians.[155] The banners on the protest line, on which the ETU maintained a presence, admonished people not to be 'scabby the rat'. But Mr Flens had accepted employment with UGL. In my view, these circumstances provide a compelling motive for Mr Hatwell to use abusive language towards Mr Flens, and in particular to call him a 'scab'. Such a motive is consistent with the case put against Mr Hatwell by Esso.[156]

[125] Thirdly, and conversely, I do not consider that Mr Flens had a plausible motive to invent a complaint against Mr Hatwell. There is no credible reason as to why Mr Flens would make a false allegation against Mr Hatwell. It is common ground that, although they have known each other for a long time, Mr Flens and Mr Hatwell do not know each other well. They have had little to do with one another. There is no evidence of any history of personal animosity, no previous incidents involving altercations, arguments, hurt feelings, disagreements or even any significant interactions.

[126] Counsel for Mr Hatwell contended that Mr Flens had been subjected to intense criticism from former UGLK employees on the protest line, and that he held a grudge against the union. It was submitted that Mr Hatwell was a delegate and representative of the union, and was therefore a person on whom Mr Flens could exact retribution for the hurt visited on him by the union and its members on the protest line. However, Mr Flens was very open about his attitude to those who had subjected him to abuse. It was put to Mr Flens in cross-examination that he 'blamed the unions and the members who are standing out the front in the protest line for creating [these kinds of effects] on you and your family'. He responded candidly and without hesitation: 'fair statement'.[157] Mr Flens acknowledged that he believed that Esso employees were siding with the protestors,[158] and that he knew that Mr Hatwell was a union delegate.[159] However, Mr Flens said that he did not hold a grudge against the union. He said unions 'have their place,'[160] and that he remains a union member. He openly conceded that he did have a 'grudge' against the former UGLK employees who had subjected him to ill treatment on the protest line.[161] But Mr Hatwell was not such an employee and had not previously mistreated Mr Flens.

[127] Even if Mr Flens did have a grudge against the union, it is not at all clear why he would have selected Mr Hatwell as the unfortunate victim for an act of revenge. The parties' arguments concerning the application of the test in Briginshaw engaged the proposition that ordinarily people do not engage in serious misbehaviour. These observations were made for the purpose of explaining the proper approach to the burden of proof in civil proceedings. However, they are also observations of common sense and are relevant beyond the setting of the burden of proof to the consideration of contested points of evidence as between two witnesses.

[128] According to the course of common experience, a person who bears a grudge against a group will not ordinarily seek revenge against the group by targeting a random member of it. Further, if people seek revenge, it is usually directed at someone whom they consider to have wronged them. Mr Hatwell had not done anything to Mr Flens that would provide a plausible motive for him to seek revenge. In particular, as the applicants emphasised in their submissions on the industrial context, there is no evidence of Mr Hatwell having been present on the protest line, or having been involved in adverse conduct towards Mr Flens, other than as alleged in the investigation. In my view it is inherently unlikely that Mr Flens would target Mr Hatwell for revenge by concocting allegations against him. For Mr Flens to make a false accusation against Mr Hatwell in order to exact revenge against the unions and their members would be an improbable act of spite and treachery, of Shakespearean dimensions.

[129] There is simply no evidentiary basis to support an inference that Mr Flens made his complaint against Mr Hatwell in order to retaliate against the unions, Esso employees, or former UGLK employees, or indeed to retaliate against Mr Hatwell either personally or as some unfortunate proxy for anyone else.

[130] I note that in his response to the allegations letter from Esso, Mr Hatwell raised a different possible motivation for Mr Flens to invent allegations against him. He said that he could only assume that Mr Flens was reacting to Mr Hatwell's criticism of his work, and the fact that Mr Hatwell had raised a safety issue.[162] This seems to me an unlikely motivation. Mr Flens' job was not at risk as a result of Mr Hatwell's intervention, nor did Mr Flens suffer any other adverse consequences from it.

[131] These three reasons - the credibility of Mr Flens' evidence, the presence of a compelling motive for Mr Hatwell to abuse to Mr Flens, and the absence of a plausible motivation for Mr Flens to invent allegations against Mr Hatwell - provide more than a sufficient basis for me to accept Mr Flens' evidence over that of Mr Hatwell in relation to what occurred during their exchange on 31 July 2017. However I shall mention some further reasons.

[132] Fourthly, Mr Hatwell acknowledged that he asked Mr Flens about an RDO. He admitted that there was no reason for him to ask Mr Flens about his terms and conditions of employment.[163] I find it improbable that Mr Hatwell would neutrally, and out of sheer curiosity, ask such a question of a UGL contractor whom he did not know well. Mr Hatwell also acknowledged that shortly after his conversation with Mr Flens, he asked Mr Little, another UGL employee, about whether he was on penalty rates.[164] I leave to one side whether Mr Hatwell 'quizzed' Mr Little about this. The uncontested evidence is that Mr Hatwell asked two employees of UGL about their conditions of employment. Mr Hatwell's acknowledged position was that he did not think people should be accepting offers of employment with UGL.[165] (I note that Mr Hatwell, Mr Gelagotis and various other witnesses maintained that they approached employees of contractors with caution.[166] Asking a UGL employee about one of their conditions of employment does not strike me as a cautious act.) Mr Hatwell's questions about Mr Flens' and Mr Little's conditions of employment at UGL touch on the motive Mr Hatwell had for abusing Mr Flens, namely acceptance of employment with UGL. In my view, these questions are consistent with the existence of such a motive, and show that UGL conditions were on Mr Hatwell's mind during his interaction with Mr Flens.

[133] Fifthly, the language complained of by Mr Flens is consistent with that found on signage on the protest line, where the unions maintained a presence. Mr Hatwell was a CEPU delegate and supported the unions' position. Mr Flens was a person whose name appeared on a list at the protest line of those who had signed contracts with UGL. He was a person against whom the word 'scab', as used on the protest line, was directed, and might 'logically' (although unacceptably) be used: he had accepted a contract with UGL on terms inferior to those that had applied at UGLK.

[134] Sixthly, the word 'scab' was used in the workplace. Mr Hatwell initially gave evidence that he did not use this language, but that he may have heard it on site - although he could not recall who used it.[167] However under cross-examination, he acknowledged that he used the term 'scab' (albeit, he said, in talking about issues that were happening, rather than directing the word at people).[168] His evidence was that all members of his workshop used the word amongst themselves.[169] He said there were lots of conversations on site that involved the words 'scab', 'scum', 'scabby', 'dog', 'grub', or similar terms, and 'scabby the rat', in reference to contractors.[170] It was 'part of the environment.'[171] Mr Hatwell acknowledged that his union's conduct outside Longford was sending a message to UGL workers that they were scabs.[172] Mr Burton also accepted that Esso employees considered UGL employees to be 'scabs': 'we talked about people taking jobs and used the term, 'scab', to describe them'.[173] The evidence suggests that the use of terms such as 'scab', at least on the protest line and among Esso employees themselves, was common place and had become normalised. In normal circumstances, a person does not call another person a scab. But these are not normal circumstances. In my view, they are consistent with a conclusion that Mr Hatwell did use the word scab in his exchange with Mr Flens.

[135] I note that the evidence in the preceding paragraph is the extent of the reliable evidence that goes to any broader allegation that Mr Hatwell 'used offensive and intimidating language towards and about employees of contractors' more generally. Clearly it relates to use of language about, not towards contractors. In the absence of further context (such as how discretely or otherwise the language was used), I do not consider this broader allegation to found a separate valid reason for termination.

[136] I have considered the evidence of Mr Aitken, who said that he did not hear Mr Hatwell make the abusive comments attributed to him.[174] However, Mr Hatwell was not directing his words to Mr Aitken. Mr Hatwell had his back to Mr Aitken for a period of time.[175] It appears that he was moving around and focused on the tasks for which he was responsible. Mr Aitken acknowledged that he did not see or hear the second part of the conversation in which Mr Hatwell was leaving the area and made the remark about the RDO.[176] In short, Mr Aitken's evidence that he did not hear the abuse does not mean that it did not occur or is unlikely to have occurred. There was ample opportunity for the words to be uttered without Mr Aitken being any the wiser.

[137] I would note that the fact that the altercation arose in the setting of Mr Hatwell raising safety concerns is not in my view of particular relevance. Mr Hatwell's position as an electrical inspector establishes his expertise on technical matters. It appears that Mr Aitken was at the job as the electrician responsible for checking continuities[177] and that checking the generator was a separate job for another work permit. Mr Flens assumed that Mr Aitken was the responsible electrician; and 'you wouldn't normally require two Esso electrical employees on that type of job [continuity checks]'.[178] There is some suggestion in this statement that Mr Flens was receiving unwarranted additional attention, however I do not consider this to be the case. Mr Hatwell's explanation for showing interest in Mr Flens' work was cogent, and given Mr Hatwell's electrical expertise, I accept it. In my view the reasons for Mr Hatwell initially engaging with Mr Flens are not of great significance.

[100]

[138] For the above reasons, I accept Mr Flens' evidence that Mr Hatwell said to him: 'You're doing every cunt's job now are you', and 'you don't have an RDO, you're a fucking scab'. I am persuaded that these words were spoken.

[139] I also find that by speaking to Mr Flens in this way, Mr Hatwell contravened Esso's harassment policy. I address the terms of the policy in further detail in relation to Mr Gelagotis, however it suffices to note that it prohibits any inappropriate conduct that has the purpose or effect of creating an intimidating, hostile or offensive work environment.[179] The policy applies the standard of a reasonable person.[180]

[140] It was a term of Mr Hatwell's contract of employment that he comply with the policy.[181] He was reminded, in the warning letter he received on 30 June 2017 in relation to his unauthorised absence from the site, that it remained a condition of his employment that he comply with company policy.[182] He was also reminded of the harassment policy on 22 June 2017, the day the protest line commenced, when Mr Kostelnik sent an email to all employees and contractors, including Mr Hatwell, reiterating that they were to comply with the Harassment Policy.[183] Mr Hatwell had himself invoked the harassment policy on two occasions.[184]

[141] The obligations set by the harassment policy were in my view reasonable. Mr Hatwell contravened the policy by engaging in inappropriate conduct that had 'the purpose or effect of ... creating an intimidating, hostile or offensive work environment', namely by uttering the abusive words to Mr Flens on 31 July 2017.

[142] In closing oral submissions, counsel for Mr Hatwell noted that, in her evidence, Ms Butler had said that she would not dismiss an employee for the single use of the word 'scab'.[185] The context of this evidence makes clear that she is not referring to the single use of the word 'scab' by Mr Hatwell in the circumstances of the present case. She was answering a question of an un-contextualised nature. As I discuss further below in the context of Mr Gelagotis' alleged conduct, an abusive word can be used in a range of possible contexts (including, significantly, in private). Ms Butler was not in my view suggesting that, had the only allegation against Mr Hatwell concerned his use of the word scab in the context of what he said to Mr Flens, she would not have dismissed him.

[143] In any event, regardless of what may be Ms Butler's view of the matter, I consider that to call a person a 'fucking scab' in the circumstances of my findings above is a very serious matter. It constitutes a valid reason for dismissal. I consider further below whether the conduct amounts to serious misconduct, and the significance of clause 22 of the Onshore Agreement.

[102]

[144] The termination letter handed to Mr Gelagotis on 30 October 2017 stated that he had engaged in 'conduct designed to ignore, exclude and isolate employees of contractors on site including by initiating discussions with Mick Hatwell and Shane Bennett seeking to have [Mr S.P.] excluded from the lunchroom, and the use of offensive and intimidating language towards and about employees of contractors' (see [66] above).[186]

[145] There is a preliminary question as to whether there are three reasons for Mr Gelagotis' dismissal, or only two. Esso's final written submissions focus on two matters: Mr Gelagotis' role in Mr S.P.'s exclusion from the lunchroom, and his use of language towards and about contractors. The broader proposition that Mr Gelagotis engaged in conduct to ignore, exclude and isolate contractors is not seriously pressed by Esso, and in my view there is little evidence to support such a proposition. However, it is appropriate that I address the matter briefly.

[146] The principal source of evidence going to the more general allegation that Mr Gelagotis sought to 'ignore, exclude and isolate' employees of contractors was Mr Jordan Knight. He was one of the two contractor-apprentices who were asked to leave the lunchroom in January 2017. Mr Gelagotis gave evidence that Mr Knight is his friend.[187] According to Esso, Mr Gelagotis warned Mr Knight not to accept employment with UGL, and that if he did accept it no one would talk to him just like no one would talk to Mr S.P.

[147] Mr Knight was not called or summonsed to give evidence before the Commission. Mr Gelagotis admitted having a conversation with Mr Knight about the question of a UGL contract but maintained that he said 'have a good think about it and do what's right for you and in your best interests, but you obviously have to know the ramifications of both sides.'[188]

[148] At the hearing, Esso tendered a file note prepared by Ms McMillan[189] of a conversation she had with Mr Knight on 9 October 2017. Ms McMillan records that she asked Mr Knight whether Mr Gelagotis had said to him 'No one's going to talk to you like no one's talking to [Mr S.P.]'. The response recorded by Ms McMillan was that Mr Knight told her that Mr Gelagotis said to him, in the context of him potentially signing a UGL contract, 'you'll probably find that people around here won't talk to you'. In my view it is clear that Mr Knight's position is that Mr Gelagotis did not say to him the words 'like no one's going to speak to [Mr S.P.]'. The second version of Mr Knight's statement appears to have come from Esso's interview with Mr S.P. and Mrs S.P. During the interview, Mrs S.P. answered a number of questions directed to Mr S.P. It was Mrs S.P. who stated that Mr Gelagotis had said to Mr Knight that, if he signed a UGL contract, people might not talk to him 'like we are not going to talk to [Mr S.P].'[190]

[149] I accept the position of Mr Gelagotis that his comments to Mr Knight did not connote any threat.[191] They were a statement of fact and a practical warning to his friend. However, Mr Gelagotis' acknowledgement that there would be 'ramifications' for Mr Knight if he signed a contract is evidence of the tense environment at Longford.

[150] The other alleged instance of Mr Gelagotis 'ignoring, isolating or excluding' employees of contractors was that he ignored Mr S.P. Ms Butler gave evidence that she accepted Mr S.P.'s evidence that Mr Gelagotis had been ignoring him and treating him differently because he was a UGL employee.[192]

[151] It will be recalled that Mr S.P. named Mr Gelagotis in his note as one of those who 'incite hatred, segregation, isolation between Esso workers and contractors'. This claim was not repeated by Mr S.P. during his interview with Esso. When Mr S.P. was asked about what Mr Gelagotis had said to him about signing the UGL contract, Mr S.P. said: 'Oh, he asked what, what I was going to do. And I said oh well I'm going to sign and he said alright, alright, yeah'. The interview then records Mrs S.P. saying 'and then he didn't talk to you.'[193] The conversation then moved on.

[152] In my view, the evidence does not sustain a conclusion that Mr Gelagotis 'ignored' Mr S.P. Mr Gelagotis admits that he kept interaction with Mr S.P. to a minimum.[194] But this does not mean that he ignored him. In any event, in my view, the evidence does not substantiate the more general allegation that Mr Gelagotis 'ignored, excluded and isolated contractors.' It is not a valid reason for dismissal.

[104]

[153] The circumstances surrounding Mr S.P. being excluded from the lunchroom have been addressed earlier in relation to Mr Hatwell's dismissal, and it is not necessary to repeat what was said earlier, but instead to add to it, focusing on the actions and motivations of Mr Gelagotis.

[154] I note that although the grounds for termination refer to Mr Gelagotis initiating discussion 'with Mick Hatwell and Shane Bennett', it is presently appropriate to focus on the role of Mr Gelagotis. What Mr Hatwell did or did not do may be of relevance, but the Commission must consider, and establish, what Mr Gelagotis did in connection with Mr S.P. being asked not to use the lunchroom, and why.

[155] Esso contended that Mr Gelagotis initiated a decision-making process at the communications meeting that led to Mr S.P. being excluded from the lunchroom, and took active measures after the meeting to secure this outcome. It submitted that Mr Gelagotis knew this would be hurtful to Mr S.P., and that the reason for his actions was that Mr S.P. had accepted employment with UGL. It said that this contravened its policy and constituted a valid reason for dismissal.

[156] Mr Gelagotis acknowledged that he raised the use by contractors of the lunchroom at the communications meeting on 15 June 2017, and that this matter also concerned Mr S.P.'s use of the lunchroom.[195] In this sense, it can be accepted that he 'initiated' a discussion about Mr S.P. being asked to leave the lunchroom. In addition, after that discussion, Mr Gelagotis took further action to bring about Mr S.P. being asked not to use the lunchroom.

[157] Mr Gelagotis said in his witness statement that it was suggested during the communications meeting that Mr Lyndon, Mr S.P.'s friend, should talk to Mr S.P. about not using the lunchroom.[196] He appeared to suggest that he had a conversation with Mr Lyndon about this at the communications meeting, but conceded in cross-examination that in fact he had this discussion with Mr Lyndon after the communications meeting.[197] Following the discussion between Mr Gelagotis and Mr Lyndon, Mr Lyndon spoke with Mr S.P. and asked him not to eat his lunch in the lunchroom 'while all this shit's going on'.[198]

[158] According to the evidence of Mr Matt Taylor, Esso's mechanical supervisor, Mr S.P. came into his office and told him that Mr Lyndon had asked him not to eat his lunch in the lunchroom.[199] Mr Taylor said that Mr S.P. was very upset. He asked Mr S.P. if he wanted to make a complaint, to which Mr S.P. said no, and that if he made a formal complaint, it would make matters more difficult.[200] Mr Taylor recounted in his statement various discussions with Mr S.P. that occurred in June and July 2017, in which Mr S.P. spoke of his difficulties in dealing with Esso employees, including Mr Gelagotis.[201] The evidence of Mr S.P. and Mrs S.P. also deals with these issues. I do not place weight on this evidence, as it has not been adequately tested. Mr Taylor's impression was that Mr S.P. was struggling to cope with the contract handover from UGLK to UGL.[202] He said consideration was given to having Mr S.P. employed through an entity other than UGL in order to take pressure off him.[203] On 13 July 2017 Mr S.P. went on leave. He returned to work on 2 August 2017. Since 7 August 2017 Mr S.P. has been on sick leave.

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[163] Further, Mr Gelagotis was asked when he first found out that his union took the position that, if a person accepted a UGL contract, that person was a 'sell out'. He replied that he had not known of this position at all until the day of his evidence.[209] Later however, he acknowledged in cross-examination that by the time he became aware that Mr S.P. had signed a UGL contract, Mr Gelagotis knew that his union took the position that Mr S.P. should not be signing up;[210] and that the inflatable rat was directed at UGL employees, that it was designed to send a message to them, and that his union labelled UGL employees 'scabs'.[211] On one view, the answer to the first question might quibble with what exactly constitutes a 'sell out'. At the least, it is not a candid answer, in light of his subsequent responses.

[164] Thirdly, some of Mr Gelagotis' answers displayed an improbable naivety. For example, Mr Gelagotis said that, although he knew about the union organising a rally in Melbourne on 20 June 2017, he did not know what it was about.[212] As for the walk off at Longford on the same day, for which he and others received a warning letter from Esso, Mr Gelagotis said that he did not know the reason for it.[213] He denied any knowledge that the walk off and rally were in support of a position against UGL.[214] He agreed with a rhetorical proposition that he simply walked off because the union wanted him to.[215] It seems implausible to me that Mr Gelagotis did not have some understanding of these matters.

[165] Further, under cross-examination Mr Gelagotis repeatedly said that he did not know the name of the large inflatable rat that stood on the protest line in the middle of last year.[216] As to whether Mr Gelagotis had seen the sign that said 'Don't be scabby the rat', he gave conflicting answers - first that he had seen it, then that he had not seen it.[217] In a photograph tendered in evidence to the Commission, the sign is immediately next to the rat. It is possible that Mr Gelagotis was looking at the tendered picture of the rat and the sign when he gave his first answer. However, I find it difficult to accept that Mr Gelagotis did not know the name of the rat, and had not seen the prominent sign which referred to it, both of which were on the protest line that he drove past every day.[218]

[166] Another instance of Mr Gelagotis' professed but improbable lack of knowledge concerned the 'employee of the day sign'. Mr Gelagotis acknowledged that he had seen it. But when it was put to him in cross-examination that he knew the sign referred to a UGL employee, Mr Gelagotis said 'no'.[219] When asked who else the sign could possibly refer to - clearly not an Esso employee - Mr Gelagotis agreed, but said now that he did not know who the employee was. He then conceded that he did know that the sign related to an employee who had come back to work for UGL.[220]

[167] I do not make global credit findings in relation to Mr Gelagotis' evidence. The fact that I consider many of his answers to be unsatisfactory and unreliable does not mean that I necessarily reject his answers in respect of other matters. The fact that he has given unsatisfactory answers in relation to his knowledge of the industrial situation at Longford is a matter that can be taken into account in considering the credibility of his evidence about his motivations for initiating the exclusion of Mr S.P. from the lunchroom. However, I will focus attention on Mr Gelagotis' evidence about his motivations (some of the matters I have referred to above relate directly to these motivations), and on the other evidence that is relevant to his stated or actual motivations.

[119]

[172] Mr Gelagotis contends that this evidence corresponds with Mr Lyndon's evidence that Mr S.P. was 'sent home' three or so times for aggressive behaviour.[228]

[173] In his interview with Esso, Mr S.P. denied saying to anyone that, if they had a problem with him, 'they should take it outside the gate'. He said that he might have mentioned to a supervisor that, 'back in the day', they would 'sort it out like men'.[229]

[174] There is no clear evidence as to whom Mr S.P. made the comments alleged by Mr Gelagotis. Mr Gelagotis told Esso that he had been in front of the tool store, where Mr S.P. worked, when he heard Mr S.P. make these remarks. As already noted, in his interview with Esso, Mr Gelagotis could not recall who Mr S.P. made the comments to. In cross-examination, when asked if he could name one person to whom Mr S.P. made these comments, he immediately identified Shane Small and Robert Lyndon.[230] But Mr Small and Mr Lyndon made no reference to this in their evidence. As well as not originally mentioning their names to Esso, Mr Gelagotis did not refer to them in his first statement, or his reply statement. I find Mr Gelagotis' evidence on this matter unreliable.

[175] Mr Lyndon said that he had heard Mr S.P. say several times over the previous 12 months that he wanted to 'drag blokes across the counter'.[231] Again, he does not say who Mr S.P. said this to or about - or indeed what might have prompted Mr S.P. to say such a thing. I would note that in my assessment, Mr Lyndon coloured his evidence about Mr S.P. by remarking that Mr S.P. had been 'sent home' three or so times for aggressive behaviour. There is no evidence of aggressive behaviour; the evidence, such as it is, concerns aggressive comments. Further, to say that he was 'sent home' for aggressive behaviour suggests Mr S.P. was subject to a disciplinary response. There is no evidence of this. Mr Lyndon also said that there was a 'very big risk of conflict' involving Mr S.P.[232] Yet Mr Lyndon had not previously raised this 'big risk' with anyone. And he acknowledged that he was aware that employees should report safety risks.[233]

[176] Nevertheless, based on the evidence of Mr Taylor, Mr Lyndon, and Mr S.P. himself,[234] it can be concluded that Mr S.P. made statements that were or could be considered aggressive. It is not established that he made such statements directly to Esso workers. In my view, if Mr S.P. had said to Esso employees directly words to the effect of 'if you have a problem with me, let's take it out the front', it is likely to have been the subject of some controversy. I consider it likely that a complaint or concern of some kind would have been raised by the Esso employee in question.

[177] Mr S.P.'s denial to Esso that he spoke the words in question was in response to whether he said the words 'to anyone'. The context of the question asked of Mr S.P. in the interview with Esso suggested that the allegation was that he made the remarks directly to those whom he proposed to 'take out the front'. Mr S.P. did not deny, because he was not specifically asked, making the alleged comments to a third party; and indeed he acknowledged making a similar remark to a supervisor. Despite Mr Gelagotis' unsatisfactory evidence about whom Mr S.P. might have made the remarks to, it does not necessarily follow that he is making the entire thing up. I accept that Mr Gelagotis heard Mr S.P. make comments along the lines alleged, but not that they were spoken directly to a person whom he might 'meet out the front.'

[178] What did Mr Gelagotis understand to be the import of Mr S.P.'s remarks? This is to be considered objectively, and in the light of Mr Gelagotis' reaction to the remarks.

[179] It does not appear to me that the statements of Mr S.P. constituted a credible threat of violence or posed any real risk of a situation arising that might lead to violence. I have found that the comments were not threats directed at those to whom they may have related. As with the comments referred to by Mr Lyndon and Mr Taylor, they reflected a person venting his spleen, not someone engaging in a direct altercation with people. There is no evidence before the Commission, or allegation, that Mr S.P. directly threatened anyone, let alone engaged in any aggressive behaviour. The fact that he may have been angry (presumably about his treatment at the hands of others) and complained about it in colourful language to third persons does not to my mind present a risk of violence. Further, I would also not conclude from the formulation 'we'll sort it out outside the front gate' that a physical altercation is implied. It has in mind addressing the matter in some way after work, rather than at work.

[180] Further, Mr Gelagotis did not report the remarks, although he was a health and safety representative. He did not immediately tell others about it. In short, he did not act in a way that suggested that he himself regarded the remarks as posing a safety risk. In my view Mr Gelagotis' evidence of his motivations is not credible. My conclusion in this regard is reinforced by my assessment that Mr Gelagotis' evidence of what he said during the communications meeting is itself not credible, as I will now explain.

[181] In his first witness statement filed in the proceedings, Mr Gelagotis stated that, when he participated in the interview with Esso in September 2017, he was very nervous, and that his anxiety 'got in the way', such that certain clarifications were required in respect of his answers to Esso.

[182] During the interview with Esso in September, Mr Gelagotis said that at a certain point during the communications meeting 'an issue was raised about, well, they [evidently, the two apprentices] can't have lunch with us and youse are picking them out then we shouldn't have [Mr S.P.] in the lunchroom'.[235] Mr Zvirbulus then asked Mr Gelagotis 'Do you know who raised that?' Mr Gelagotis replied 'No, I don't, no ... to the best of my knowledge, no I don't but, I know for a fact that in our meeting that were in there ... there was a motion, there was something that was granted ...'[236] Later, in his witness statement, Mr Gelagotis endeavoured to explain that he had thought Mr Zvirbulis was asking him about who had raised the issue of the apprentices being in the lunchroom at the communications meeting in early 2017.[237] This is not how I would have understood Mr Zvirbulis' question. He was asking who raised the motion. However, perhaps somewhat charitably, I am prepared to accept that nerves might have 'got in the way', as Mr Gelagotis said.

[183] Mr Gelagotis said in his witness statement that what he had not mentioned in the interview with Esso was that he had spoken at the communications meeting of his concerns about Mr S.P., namely that 'in the current environment, with [S.P.] and the EBA, I don't think it's a good idea for him to sit in here, it could turn to violence.'[238] This seems to me to have been a very significant omission.

[184] Further, in cross-examination, Mr Gelagotis was very clear that at the communications meeting, he used the word 'violence'. The following exchange occurred:

[124]

[185] No other witnesses recalled Mr Gelagotis using word 'violence' at the communications meeting. In particular, Mr Hatwell was asked in cross-examination if he recalled Mr Gelagotis saying at the communications meeting that having Mr S.P. in the room could turn to violence. He said 'no'.[240] Further, Mr McDonald's note of the communications meeting says this: 'Issue raised, contractors in lunchroom, comments around what does the sign say on the door'.[241] This is a rather bland reference to a situation that could lead to violence. Surely if a risk of violence had been raised it would have been noted, or remembered by someone.

[186] In my view, it is implausible that Mr Gelagotis raised a concern at the communications meeting about Mr S.P. being violent. It would not only have been natural for him to mention this to Esso during his interview; it would have been a matter of some significance, to be emphasised. As it was, Mr Gelagotis mentioned to Mr Zvirbulis only that he had discussed Mr S.P.'s alleged remarks with Mr Bennett; nothing is said of his having raised the matter at the meeting. If to that point in the interview Mr Gelagotis had somehow forgotten to mention that he had raised a concern about violence at the communications meeting, it seems likely that when the discussion turned to his conversation with Mr Bennett, Mr Gelagotis would have then told Mr Zvirbulis that he also raised the matter at the communications meeting. Instead, Mr Gelagotis told Mr Zvirbulis that the reason for asking Mr S.P. not to use the lunchroom had to do with the fairness and consistency of treatment of two apprentices who had been asked to leave the lunchroom six months earlier. This is a trivial matter as compared to a risk of violence on the part of Mr S.P. When pressed about the matter in cross-examination, Mr Gelagotis simply said that he had 'left that out'.[242] Did he not think it was relevant? Or did he not mention it because it did not occur? In my view, the latter is the case.

[187] In his evidence, Mr Gelagotis was adamant that the exclusion of Mr S.P. from the lunchroom was not about Mr S.P. personally. In his interview with Esso, Mr Zvirbulis asked Mr Gelagotis 'so you didn't raise your hand and say [S.P.] needs to be taken out of the lunchroom?' His response was 'No. Nope, no way, No way. We made a general comment and I made a general comment in the room to say [what's the difference between the apprentices and Mr S.P.]'.[243] Mr Gelagotis said that the 'motion' (however described) was about not having any contractors in the lunchroom. He affirmed in cross-examination that it was a 'blanket rule in respect of contractors',[244] not just about those who had signed with UGL.[245]

[188] On Mr Gelagotis' account, his motivations had nothing to do with Mr S.P.; but on the other hand, they had everything to do with him, because Mr S.P. posed a risk of violence. There is an irreconcilable tension between these positions.

[189] Furthermore, if there had been a genuinely held concern about the risk of violence, it seems to me unlikely that Mr S.P. would be asked not to use the lunchroom, but for no other action to be taken to prevent violence. Violence could potentially occur outside the lunchroom. As Mr Hatwell, Mr Gelagotis and Mr Lyndon themselves acknowledged, there was no evidence suggesting that Mr S.P. was making threats to anyone in the lunchroom.[246] Mr S.P's aggressive statements were said to have been made in the tool store.[247]

[190] Further, the exclusion of Mr S.P. from the lunchroom does not seem to me to be a step that would necessarily minimise the risk of any apprehended conflict. If Mr S.P. was aggressive, an effort to exclude him might just as likely increase the risk of conflict as minimise it.

[191] Finally, the occupational health and safety dimension of Mr S.P.'s alleged potential for violence is also of significance. Esso has safety policies which require the reporting of situations where any worker's safety on site is at risk.[248] Mr Gelagotis was a health and safety representative and was aware of Esso's OHS policies.[249] If a safety issue had been identified on site, the logical and appropriate response would have been to report it. It is a condition of entry into the Longford site, and was a condition of Mr Gelagotis' employment, that conduct of this nature is to be reported,[250]

[192] For the above reasons, I do not accept that Mr Gelagotis took action to have Mr S.P. excluded from the lunchroom for genuine safety reasons_._ I do not believe that Mr Gelagotis held a genuine concern that Mr S.P. might be violent or otherwise posed a safety risk.

[126]

[193] Mr Gelagotis' second motivation for seeking to exclude Mr S.P. from the lunchroom was that this is where Esso maintenance workers speak about important things, such as current disputes and claims made by the unions in enterprise bargaining with Esso. He stated that such matters concerned the interests of Esso workers, who should be able to have discussions freely in the space that has been given to them by the company to meet during breaks. Mr Gelagotis stated that Mr S.P. had made it clear that he did not support the unions or Esso workers.

[194] I accept that there might be important matters of union or Esso business to which employees of contractors should not be privy. Although there was no current enterprise bargaining involving Esso maintenance employees, given that the Onshore Agreement had recently been struck, it is reasonable to assume that there are other workplace matters affecting Esso employees which they may wish to discuss privately, without the presence of employees of contractors. Issues for discussion might well include, and indeed have included, issues related to UGL.[251]

[195] However, if this was a genuine reason for having Mr S.P. not use the lunchroom, why had it not been raised before? Further, why would this require him to be completely excluded? Mr Hatwell and Mr Gelagotis acknowledged in cross-examination that there had not previously been an issue with Mr S.P. leaving the lunchroom during a meeting, if requested.[252] Mr S.P. could have continued to use the lunchroom, and absented himself for meetings, whether scheduled or impromptu, at which union business or matters concerning Esso employees were to be discussed. There is no reason why Mr S.P. could not have been asked to leave. In my opinion, Mr Gelagotis' second reason for seeking to exclude Mr S.P. from the lunchroom is not credible.

[196] Mr Gelagotis' third stated motivation was that two former apprentices were also required to leave the lunchroom earlier in the year, because they were employees of contractors. Mr Gelagotis said that he considered that, if the apprentices were asked not to use the lunchroom, so too should be all other contractors, including Mr S.P. However, why this matter should be attended to some sixth months after the event is not explained.

[197] I accept that the Esso lunchroom was for Esso employees, and contractors had been asked to leave in the past, however an exception to this rule had been made, in practice, for Mr S.P. For Mr Gelagotis it is then contended that Esso employees could, effectively, terminate the exception and apply the 'general rule' that only Esso employees may use the lunchroom; and that there are legitimate industrial reasons for this position. But why did they choose to do so at that particular meeting on 15 June 2017, one day after Mr McDonald's message to employees about UGL? There was no convincing explanation offered by Mr Gelagotis as to this question of timing. It was suggested in final oral argument that the meeting of 15 June 2017 might have been the first opportunity to address this matter at a communications meeting.[253] But this is not persuasive. There does not appear to be any reason why the matter could not have been addressed between communications meetings.

[198] In my view, Mr Gelagotis' third stated motivation for seeking to have Mr S.P. excluded from the lunchroom is not convincing. I reject it.

[127]

[199] I do not accept Mr Gelagotis' explanation of his motivations for proposing, and seeking through his discussion with Mr Lyndon to procure, Mr S.P.'s exclusion from the lunchroom. What then was his actual motivation?

[200] The drawing of inferences from circumstantial evidence is an everyday occurrence in courts, as well as in tribunals required to act judicially, such as the Commission. It is a feature even of the criminal courts, where the finder of fact must usually reach satisfaction beyond reasonable doubt. The Commission may and should draw reasonable inferences as part of its obligation to consider relevant and probative evidence. Proof of any fact on the balance of probabilities can be established by circumstantial evidence; that is, by proof of primary or intermediate facts from which the court infers a further fact.[254]

[201] In Bradshaw v McEwans,[255] the High Court stated that inferences in civil cases may be drawn where the circumstances appearing in the evidence give rise to a 'reasonable and definite inference', rather than just 'conflicting inferences of equal degrees of probability.'[256] I also note that the fact-finding process is directed at the totality of the evidence,[257] and that Briginshaw requires inferences to be reached upon a comfortable level of persuasion, commensurate with the gravity of what is alleged.

[202] It was contended for Mr Gelagotis that much of the circumstantial evidence relied on by Esso about the behaviour of the protestors, and the views apparently expressed by the AMWU and ETU, concerned the behaviour of others. This is true. It was not contended that either of the applicants had any role in the activity on the protest line. Mr Gelagotis submitted that the protest and union campaign material is relied on by Esso as the foundation for an inference supporting the conclusion that they targeted UGL contractors in the ways alleged by Esso; but that the Commission should reject such 'indirect inferences'. For Mr Gelagotis, it was contended that this material does not assist Esso to prove the specific conduct alleged, and it is only useful in explaining the workplace context.[258]

[203] Of course, all inferences are in one sense 'indirect'. If there is direct evidence on a particular matter in dispute, which evidence is accepted, there may be no need to draw inferences in relation to that matter. In the present case, Mr Gelagotis gave direct evidence as to his motivations in seeking to have Mr S.P. excluded from the lunchroom. I do not accept this evidence. Therefore, in seeking to understand what has occurred for the purposes of establishing whether a valid reason for dismissal exists, it is appropriate to consider whether inferences can be drawn as to Mr Gelagotis' real motivation for seeking to have Mr S.P. excluded from the lunchroom.

[204] In my view, the sequence of events leading up to the communications meeting outlined earlier in these reasons, together with the evidence of Mr Gelagotis himself, points clearly to a motivation related to Mr S.P.'s acceptance of a contract with UGL. It will be recalled that on 29 May 2017, a letter was sent jointly by the three unions to their members, stating that no member should be accepting employment with UGL on the current terms and conditions, and that to do so would be a 'sell out' of hard won conditions. On 9 June 2017, Mr S.P. signed an offer of employment with UGL. On 14 June 2017, Mr McDonald, the AMWU delegate, sent an email to Esso maintenance and operations employees, including Mr Hatwell and Mr Gelagotis, stating that the 'unions are not letting this slip', that 'a visual presence will come soon enough', and that UGLK members should not sign 'this crap deal' that was selling '25 years of hard fought conditions down the drain.'[259] The communications meeting at which Mr Gelagotis proposed excluding Mr S.P. occurred the following day.

[205] Mr Gelagotis acknowledged under cross-examination that he was aware by 13 or 14 June 2017 that some UGLK employees had signed a contract with UGL and by mid-June knew that Mr S.P. had signed.[260] He accepted that by the time he became aware that Mr S.P. had signed the contract he knew that his union, the AMWU, was opposed to offers of employment from UGL which reduced terms and conditions of employment,[261] and took the position that Mr S.P. should not have accepted employment with UGL.[262]

[206] Mr Gelagotis instigated the process that resulted in the exclusion of Mr S.P. He followed this up by discussing with Mr Lyndon the task of speaking to Mr S.P. about not using the lunchroom. He was, as Ms Butler put it, 'lobbying' for a particular outcome and succeeded in implementing that outcome.[263] In my view, the inference arises clearly that the reason for Mr Gelagotis seeking to exclude Mr S.P. from the lunchroom was because he had accepted employment with UGL. This motivation accords with his unions' industrial interests, as identified in Mr McDonald's email the day before the meeting. It is also consistent with Mr Hatwell's evidence about his understanding of the concern raised by Mr Gelagotis at the communications meeting, namely that it was about 'UGL contractors in our lunchroom'.[264]

[207] In the present case, a reasonable and definite inference can be drawn that Mr Gelagotis' motivation for excluding Mr S.P. was the fact that he had signed a contract with UGL. I draw this inference upon a comfortable level of persuasion as to its validity. The inference is consistent with the case put against Mr Gelagotis by Esso.[265]

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[212] It was contended for Mr Gelagotis that, given the existence of the practice, it is unfair to apply another standard as a basis for employee discipline that has the effect of limiting or qualifying the circumstances in which a contractor could be asked to leave the lunchroom. Mr Gelagotis contended that he did no more than to instigate a request of a contractor that he eat his lunch outside the lunchroom, consistent with the practice.[269]

[213] I accept there was a practice whereby the lunchroom was for Esso maintenance employees. They could allow others to use it, but could ask those who were not Esso maintenance employees not to use it. However, there was no evidence of the practice of Esso employees deciding who could use the lunchroom being exercised in an arbitrary or discriminatory way. Contractors had been asked not to use the room because they were contractors per se, that is, not Esso employees. This is what occurred in relation to the two apprentices in 2017, and evidently the crane boom drivers referred to by Mr Taylor above. They were 'strangers.' However, there was no practice of excluding people because they were employees of a particular contractor.

[214] It would likely have been consistent with the practice to exclude Mr S.P. from the lunchroom as part of a blanket removal of all contractors. This is what Mr Gelagotis says occurred. But I do not accept this. I have concluded above that Mr Gelagotis sought to exclude Mr S.P. from the lunchroom because he had signed a contract with UGL. In my view this was not consistent with the 'practice'.

[215] Esso further contended that the fact that a practice exists, and was endorsed or tacitly agreed to by Esso, does not mean that the exercise of any 'right' or custom pursuant to the practice is beyond censure. Esso argued that employees could not, for example, exclude women and invoke their customary practice to escape reproach. It contended that whatever practice has developed would operate subject to employees' contracts of employment, and the express terms of Esso's policies, as well as provisions of the Onshore Agreement. However, if a particular practice was effectively authorised by Esso, then, even if it were odious, Esso could not fairly discipline employees for engaging in it.

[216] However, there is no suggestion here that Esso authorised a practice of excluding from the lunchroom employees of particular contractors. Further, the applicants did not contend that the practice was such that it would be permissible to ask Mr S.P. not to use the lunchroom because he had signed a UGL contract.[270]

[217] Mr Gelagotis' conduct was not consistent with the 'practice'. Did it breach Esso's policy? The Commission was taken to the terms of the harassment policy in some detail. The Harassment in the Workplace Policy defines harassment as including 'any inappropriate conduct which has the purpose or effect of ... creating an intimidating, hostile or offensive work environment.'[271] The 'Exxon Mobil Working Together: Harassment in the Workplace Policy and Practices' (Working Together Guide), elaborates on the policy, further addressing the types of conduct that can constitute harassment. In relation to 'hostile work environment' it states:[272]

[133]

[218] Excluding a person from the lunchroom or some other area or group is not specifically identified as a subspecies of harassment. However in my view such conduct can fall within the proscription of creating a hostile working environment, depending on the circumstances. I note that one of the consequences of creating a hostile working environment is identified in the Working Together Guide as making a person feel isolated or ostracised. Whether the conduct might reasonably be expected to lead to such a result is relevant to the question of whether it offends the policy. There might also be a legitimate reason for excluding a person, and this too would need to be considered as part of the 'reasonable person' test. In the present case, I have concluded that there was no legitimate reason for excluding Mr S.P. from the lunchroom. The reason for Mr S.P.'s exclusion was that he had accepted employment with UGL. I also consider that it was reasonably foreseeable that he would feel isolated and ostracised.

[219] Mr Gelagotis contended that Mr Lyndon was asked to approach Mr S.P. about not using the lunchroom in order to ensure that the message was delivered in a respectful way.[273] I accept that Mr Gelagotis gave some consideration to the way in which Mr S.P. was asked not to use the lunchroom, and that asking Mr Lyndon to speak with him meant the delivery of the message was gentler than it might otherwise have been. But this also tends to underscore that Mr Gelagotis knew that Mr S.P. would find his exclusion from the lunchroom hurtful. This was put to Mr Gelagotis in cross-examination, and his response was equivocal - 'well, yes and no.'[274]

[220] I have considered the contention that all Mr S.P. was asked to do was not eat his lunch in the lunchroom until 'this shit blows over'.[275] For Mr Gelagotis it was submitted that this was no permanent ban, but temporary action designed to reduce the risk of conflict. Although I accept Mr Lyndon's evidence about the words he used when speaking with Mr S.P., the effect was that Mr S.P. was banned from the lunchroom, perhaps not for ever, but indefinitely. Mr S.P. was excluded from a group of which he had previously been a part.

[221] The exclusion of Mr S.P. from the lunchroom was only one dimension of his overall 'working environment'. Further, Mr Gelagotis did not singlehandedly 'create' the broader working environment, and although he was the instigator of Mr S.P.'s exclusion from the lunchroom, he did not act alone: Mr Lyndon requested Mr S.P. not to use the lunchroom. However, the expression 'creating a hostile working environment' is not to be read as a term of art requiring an overly technical analysis. It is appropriate simply to consider the ordinary meaning of the words in context, in the setting of a policy document. In my view it can sensibly and assuredly be said that Mr Gelagotis through his actions created a hostile working environment for Mr S.P. Because of Mr Gelagotis' actions, Mr S.P. was no longer welcome to use the room where he had habitually eaten his lunch. He was isolated and ostracised (the latter word means 'excluded from a group').

[222] In my opinion, Mr S.P. knew the reason for his exclusion. He said in his interview with Esso that it was not until he signed his contract that he was 'kicked out' of the lunchroom.[276] According to Mr Lyndon, when he asked Mr S.P. not to use the lunchroom, Mr S.P. said that he had been expecting this.[277] It would be entirely logical for a person in Mr S.P.'s position to draw the conclusion that the reason for his exclusion from the lunchroom was his decision to accept employment with UGL. Even if Mr S.P. did not know the reason, he was still excluded from the lunchroom for an illegitimate reason.

[223] The policy notes that harassment will not be tolerated and states that 'employees who observe or become aware of harassment should immediately advise their supervisors, higher management, or their designated Human Resources Department contacts'.[278] As to the potential consequences of harassment, the policy notes that 'all employees, including supervisors and managers, will be subject to disciplinary action up to and including termination of employment for any act of harassment'.

[224] A breach of policy may constitute a valid reason for dismissal.[279] Generally, it is relevant to consider whether what the policy required was reasonable. However the reasonableness of the policy was not in contest. For Mr Gelagotis it was contended that the harassment policy does not require Esso employees to be friends with one another or with contractors, and that Esso employees are entitled to hold and express opinions. I agree. Had Mr Gelagotis' conduct been confined to such behaviour, it would not have contravened the policy. Had his conduct really related to a general exclusion of all contractors, it would probably not, given the practice and the policy's reasonable person test, have offended the policy.

[225] However, Mr Gelagotis' conduct was intended to exclude Mr S.P., not because he was not an Esso employee (or because he was an employee of a contractor per se), but because he had accepted employment with a particular contractor, UGL. In the circumstances of the present matter, I consider that this created a hostile and intimidating work environment for Mr S.P., judged by the standard of a reasonable person. Mr Gelagotis' conduct fell within the activity proscribed by the policy.

[226] It was a term of Mr Gelagotis' contract of employment that he comply with policies.[280] He had done refresher training on the contents of the Harassment Policy and Working Together Guide in their business practice reviews in 2016.[281] Mr Gelagotis was aware that the policies made it clear that being harassed can make a person feel angry, frustrated, helpless or embarrassed, isolated, ostracised, uncomfortable or guilty[282]and that breaches of these policies are serious matters that could result in dismissal.[283]

[227] By initiating Mr S.P.'s exclusion from the lunchroom in these circumstances, Mr Gelagotis breached the policy and his contract of employment. This constituted a valid reason for dismissal.

[228] I also consider that Mr Gelagotis' actions would have constituted a valid reason for dismissal even in the absence of the policy. Mr S.P. was excluded because he chose to accept employment with UGL. To accept such employment was his industrial right. He was not to be discriminated against on this basis. Others may not approve of his decision. Mr S.P. and other UGL employees would no doubt prefer the more generous conditions that applied at UGLK. However financial and personal circumstances and pressures in life may lead people to exercise their rights in different ways. This must be respected.

[135]

[229] The Commission is required to consider whether there is a valid reason for dismissal. In relation to Mr Gelagotis, one such reason has been established. However I will record my analysis of the second reason for Mr Gelagotis' dismissal, namely that he used language such as 'scab', 'dog', 'grub' or similar language when referring to contractors.

[230] During his interview with Esso, Mr S.P. was asked by Mr Zvirbulis if particular people had used the terms 'scab or similar'; Mr Zvirbulis mentions several names. When Mr Gelagotis' name is mentioned, Mr S.P. says the word 'yep' and nothing more.[284] Mrs S.P. then stated that this would probably have been in the huddle out the front. Mr S.P. says nothing about this. Mrs S.P., in her statement that is attached to Ms Winckworth's affidavit, said that Mr S.P. had told her that Mr Gelagotis and two other employees would talk about scabs and grubs within earshot of Mr S.P. in reference to employees of UGL. However, Mr S.P. had the opportunity to relate such details to Mr Zvirbulis during his interview, but said nothing about this. It would be unsafe to rely on Mrs S.P.'s unsworn and second-hand evidence on this point in such circumstances, and I do not place any weight on it.

[231] Ms Butler concluded that Mr Gelagotis had used the word 'scab' and similar words based on Mr S.P.'s evidence in his interview with Esso.[285] She conceded that the circumstances in which Mr Gelagotis was said to have done so are not apparent and Mr S.P. says nothing about them. She agreed that, on Mr S.P.'s account, Mr Gelagotis might only have said the word 'scab' once, and that he might have said it only to other Esso employees, speaking about contractors rather than to them, although she noted that she would still not consider this acceptable.[286] Ms Butler also conceded that if the only matter before her was an isolated example of an employee using the word 'scab' once, she would not terminate that person's employment.[287]

[232] Mr Burton and Mr Hatwell both gave evidence that the word 'scab' was used on site by Esso employees and that it was used to describe UGL contractors,[288] which provides some support for the contention that Mr Gelagotis also used the word. However, the allegation against Mr Gelagotis rests largely on a bare word from Mr S.P.'s unsworn evidence. Mr Gelagotis denies using the language attributed to him by Esso.[289] He did so under cross-examination before the Commission on oath. Although I have found other aspects of his evidence to be lacking in credibility or unreliable, it does not follow that I should reject all of his evidence.

[233] Even if Mr Gelagotis did use such language, we know nothing of the context. Did Mr S.P. overhear Mr Gelagotis utter the words in hushed tones among a group of Esso employees speaking privately among themselves? Was it said in a raised voice outside the tool store so that it could be easily heard by Mr S.P.? Was it said directly to him, with an abusive adjective? The permutations, and the accompanying levels of seriousness, are many. None has been established.

[234] The allegations against Mr Gelagotis concerning the use of the offensive and abusive words about or towards contractors (or specifically the use of the words 'scab', 'scum', 'dog' and 'grub' towards and about employees of contractors, as was put in the letter of allegations) have too fragile a foundation. I find them unsubstantiated.

[136]

[235] I have concluded that there was a valid reason for the dismissal of Mr Hatwell and for the dismissal of Mr Gelagotis.

[236] On the basis of the factual findings I have made above, I am satisfied on the evidence before me that Mr Hatwell engaged in misconduct in his treatment of Mr Flens on 31 July 2017. This gave Esso a sound, defensible, well-founded and valid reason to dismiss Hatwell.[290]

[237] I am also satisfied that Mr Gelagotis engaged in misconduct by initiating and procuring the exclusion of Mr S.P. from the lunchroom, motivated by the fact that Mr S.P. had accepted a UGL contract, and that this was a valid reason for his dismissal.

[238] Esso contended that it had a further valid reason for the applicants' dismissals constituted by their dishonesty in answering questions during the company's investigation. In light of my conclusions above, it is not necessary for me to address this contention.

[239] For the purposes of establishing a valid reason in the context of s.387(a), it is not necessary to demonstrate misconduct sufficiently serious to justify summary dismissal.[291] The seriousness of the conduct, and the proportionality of the decision to dismiss Mr Hatwell and Mr Gelagotis and to do so summarily, are matters I shall consider further below in the context of s.387(h).

[240] I will also address the question of whether the conduct of each applicant amounted to serious misconduct for the purposes of clause 22 of the Onshore Agreement and whether Esso breached clause 22 in the course of my consideration of s.387(h). Also in that context I address the significance of the fact that some of Esso's grounds for termination of employment have been found to be unsubstantiated.

[241] For a dismissal to be unfair, the Commission must be satisfied that it was harsh, unjust or unreasonable (s.385(b)). In considering whether it is so satisfied, the Commission must take into account the matters specified in s.387. Having considered the question of whether there were valid reasons for dismissal, I will now address each of the remaining matters in turn below.

[138]

[242] The Commission must take into account whether an employee has been notified of the reasons for dismissal and whether the person was afforded an opportunity to respond to any reason related to their conduct or performance.

[243] In order to tell against a finding that the dismissal was unfair, notification of the reason for dismissal should occur before the decision to dismiss is made[292] and be made in explicit, plain and clear terms.[293] The question of whether an employee had an opportunity to respond to reasons relating to conduct or performance should be understood in a common sense way; the focus of the consideration is whether the employee is treated fairly, rather than on any formality.[294]

[244] It was not seriously disputed that Esso notified the applicants of the reasons for dismissal. The letters provided to Mr Hatwell and Mr Gelagotis on 17 October 2017 set out the allegations against them. The reasons for their dismissal were notified to them in the termination letters of 30 October 2017.

[245] I have considered whether the generality of some of the reasons for dismissal affects the question of whether Mr Hatwell and Mr Gelagotis were properly notified of the reasons for dismissal. However, the reasons which I have found to be valid reasons for dismissal were specifically identified. Mr Gelagotis' letter referred in particular to his initiating discussions to have Mr S.P. excluded from the lunchroom. Mr Hatwell's letter identified the abusive language he used towards Mr Flens. I am satisfied that they were notified of the reasons for their dismissal.

[246] The evidence referred to above also establishes that Esso afforded Mr Hatwell and Mr Gelagotis an opportunity to respond to reasons for dismissal related to their conduct. They both received letters setting out the allegations against them. Again, I have considered whether the generality of some of these allegations affects the question of whether they were afforded an opportunity to respond. I take note of the fact that Esso's investigation into the applicants' treatment of Mr S.P. was protracted, and that for quite some time little detail was provided to the applicants about what they were suspected of having done. This is a matter that I will consider in relation to s.387(h) ('any other matters the Commission considers relevant'). For the purposes of s.387(c), I am satisfied that Mr Hatwell and Mr Gelagotis were afforded an opportunity to respond to reasons for their dismissal related to their conduct, and that this opportunity was reasonable.

[247] Finally, as I discuss further below in relation to s.387(h), the applicants advanced a contention that Esso did not comply with the disciplinary procedure in clause 22 of the Onshore Agreement, and that this rendered the dismissal harsh, unjust or unreasonable. They did not separately contend that failure to comply with the procedure resulted in a denial of procedural fairness; nevertheless, failure to follow such a procedure could affect the adequacy of an employee's opportunity to respond to reasons for dismissal. However, as I will explain below, I do not consider that Esso did breach clause 22 of the Onshore Agreement.

[153]

[256] For the applicants, it was contended that the broader industrial context is particularly relevant to the question of harshness.[301] They submitted that the industrial disputation associated with what they describe as UGL's decision to dismiss its workforce and then offer re-employment by a subsidiary company on lower rates of pay is 'dividing the workplace and the broader community'.[302] I agree that it is quite apparent from the evidence that the circumstances surrounding UGL's employment arrangements have resulted in significant tension in the workplace and, it would appear, the local community.

[257] However, the applicants claimed that they did not engage in the conduct alleged against them. While some of the conduct of which they were accused is unsubstantiated, I have found that Mr Hatwell abused Mr Flens in the manner alleged and that Mr Gelagotis initiated the exclusion of Mr S.P. from the lunchroom because he had accepted employment with UGL, in breach of Esso's policy. In those circumstances, it is difficult to see how the broader industrial circumstances weigh in favour of a conclusion that the dismissal of either applicant was harsh, or unjust or unreasonable.

[258] Submissions as to mitigation by reference to the industrial context might have been more compelling if the conduct had been admitted and regretted, but explained in some particular way by reason of the context. It might perhaps have been said that the heightened tensions on site led Mr Hatwell and Mr Gelagotis to do things they might not otherwise have done. But this is not what the applicants say occurred. They denied the conduct which I have found to have occurred. The submission then as to the relevance of the industrial situation for the consideration of whether the dismissals were harsh appears to contend that, although the conduct is denied, should it be found that the conduct did occur, the Commission ought to consider that the conduct may be wholly or partly explainable by the industrial context, or that the context is otherwise mitigating. But because they denied the conduct, the applicants did not explain how their actions were affected by the circumstances and why this is a mitigating factor.

[259] I agree with the applicants' submission that the industrial situation was a material change in the applicants' normal working arrangement. However, in the circumstances I do not consider that it weighs in favour of a conclusion that the dismissal of Mr Hatwell or Mr Gelagotis was harsh, or unjust or unreasonable.

[161]

[269] The applicants also contended that Esso acted inconsistently by dismissing Mr Hatwell and Mr Gelagotis, but taking lesser disciplinary action against Mr Osborn, Mr Burton and Mr Moody.[309] These employees received final written warning letters for engaging in misconduct in breach of Esso's harassment policy. However, I do not consider that the conduct of Mr Hatwell and Mr Gelagotis is comparable to that of the other mentioned employees.

[270] Mr Osborn, Mr Burton and Mr Moody were disciplined for using inappropriate language and engaging in conduct intended to ignore Mr S.P. By contrast, Mr Hatwell directed offensive language towards Mr Flens. I note that Mr Derham was also dismissed for directing disparaging and belittling remarks to Mr S.P.[310] Esso found that Mr Osborn and Mr Burton used offensive language around the Longford site in conversation; Esso did not find that they directed that language at a UGL employee, or towards anyone else with the intention of creating a hostile environment.[311]

[271] I note that Mr Lyndon was not disciplined by Esso at all, nor did Esso interview him about Mr S.P.'s exclusion from the lunchroom. It was contended that this demonstrated Esso's inconsistency in its disciplinary treatment of the applicants and other employees. However, at the time the investigation into Mr S.P.'s allegations commenced, Mr Lyndon was soon to retire. His employment ended on 18 November 2017. Mr Lyndon was not named in Mr S.P.'s note, which may account for why Esso did not seek to interview him or subsequently take any action against him. In any event, his role as the proverbial messenger in Mr S.P.'s exclusion from the lunchroom was much less serious than that of Mr Gelagotis.

[272] Mr Gelagotis initiated and followed up the exclusion of Mr S.P. from the lunchroom. Mr Osborn, Mr Moody and Mr Burton ignored or treated Mr S.P. differently when interacting with him at the tool store.[312] And Mr Burton was found by Esso to have been involved in the discussions about the exclusion of Mr S.P. from the maintenance lunchroom, but he did not instigate the exclusion. There is in my view a qualitative difference between the conduct of Mr Gelagotis and that of these other three employees. It should also be recalled that Mr Bennett and Mr Derham were dismissed for reasons related to their treatment of Mr S.P.[313]

[162]

[273] I take account of the disciplinary history of Mr Hatwell and Mr Gelagotis, which is unblemished, apart from a warning that each received for participating in the walk off on 20 June 2017. There is no evidence of any previous behaviour of the kind that I have found constituted valid reasons for their dismissal. Mr Hatwell had been employed with Esso for over ten years, and Mr Gelagotis for several years, following the completion of his apprenticeship. I note their submissions that they expected to continue their careers at Esso. Mr Hatwell is doing casual work for an electrical contractor but has not been able to find a permanent job. Mr Gelagotis is doing unskilled work for his father. I have taken into consideration that in these respects, and no doubt others, dismissal has had very significant effects on both applicants, and in the case of Mr Hatwell, also on his family.

[274] I have also taken into consideration that Mr Hatwell and Mr Gelagotis were suspended on full pay on 9 August 2017 for nearly three months while Esso conducted an investigation. They did not receive letters setting out the allegations against them until 17 October 2017, although some issues had been raised with them earlier, including during the interviews on 15 August 2017 and 30 August 2017. I appreciate that it was not immediately possible for Esso to interview Mr S.P., that it was difficult for the investigation to move forward until this interview had occurred, and that Mr S.P. needed to be approached with some sensitivity. Nevertheless, during much of the period of the suspension, the applicants did not know the detail of the allegations against them in relation to Mr S.P. Although they were suspended on full pay, it must have been difficult for them not to be able to go to work as usual and lead their normal lives, with the shadow of investigation hanging over them.

[275] Another consideration I have taken into account is that several of the allegations against Mr Hatwell and Mr Gelagotis were unsubstantiated. As I mentioned earlier in these reasons, it is sufficient that there be a valid reason for dismissal. The fact that some reasons for dismissal are not made out does not necessarily affect the fairness or otherwise of a dismissal, but it is a factor that may be considered.

[276] In my assessment, this consideration does not have a bearing on Mr Gelagotis' dismissal. I have found his mistreatment of by S.P., by initiating his exclusion from the lunchroom because he had accepted with UGL, to be substantiated. In the case of Mr Hatwell, I have found his conduct in relation to Mr Flens was a valid reason for dismissal, but have not found substantiated the allegations about his conduct in relation to Mr S.P. Mr Hatwell's suspension was not confined to the issues relating to Mr S.P; the suspension letter refers to allegations about 'harassment of a UGL contractor or contractors', which includes Mr Flens. However, it was the allegations concerning the treatment of Mr S.P. that led to the protracted investigation and lengthy suspension. In my view there is an element of unfairness associated with the fact that Mr Hatwell was suspended for a long period (rather than a shorter period, as would have seemed likely had the investigation been confined to his treatment of Mr Flens) in connection with allegations that I have found to be unsubstantiated. However, it is not unfairness associated with Mr Hatwell's dismissal for mistreating Mr Flens. It does not render his dismissal for that reason harsh, unjust or unreasonable.

[163]

[277] The proportionality of the dismissal to the conduct that is the subject of a valid reason is a matter to be considered in connection with s.387(h). Clearly a dismissal may be harsh because it is disproportionate to the gravity of the misconduct on which the employer acted.

[278] As was noted by the Full Bench in Sharp v BCS Infrastructure Support Pty Limited,[314] an assessment of the degree of seriousness of misconduct which has been found to constitute a valid reason for dismissal for the purposes of s.387(a) is a relevant matter to be taken into account under s.387(h),[315] and it may also be appropriate to conclude that the misconduct was of such a nature as to have justified summary dismissal. This does not mean that it is necessary to consider that an employee's conduct meets any particular postulated standard of serious misconduct.[316]

[279] The applicants contended that for conduct to constitute serious misconduct and justify instant dismissal it must be serious, a 'radical breach' of the employment relationship that is inconsistent with its continuation. In this regard they referred to the decision of the Full Federal Court in Melbourne Stadiums Ltd v Sautner.[317] However, the Full Court in that case cites a passage from Rankin[318] noting that 'there are offences which justify dismissal but which would not, in themselves, show that the employee was intending not to perform contractual obligations in the future'.[319] The Full Court in Melbourne Stadiums also noted that the applicant's conduct in that case did not necessarily have to amount to a repudiation of his contract of employment to justify his summary dismissal.[320]

[280] Summary dismissal embraces termination of employment arising from breach of an essential term of the employment contract, a serious breach of a non-essential term, or conduct manifesting an intention not to be bound by the contract in the future.[321] In my view Mr Hatwell's treatment of Mr Flens on 31 July 2017, and Mr Gelagotis' actions in seeking to exclude Mr S.P. from the lunchroom because he had accepted employment with UGL, were serious matters, and of sufficient gravity to constitute serious misconduct.

[281] Mr Hatwell used very intimidating and abusive language towards Mr Flens. The conduct clearly contravened a policy that applied to Mr Hatwell's employment and with which he was required to comply. He was aware of the policy, had been reminded of it by management, and had himself invoked the policy on two occasions. In my view Mr Hatwell's mistreatment of Mr Flens repudiated his contract of employment with Esso. Even if there had not been such a policy, use of such language is manifestly unacceptable in the workplace and amounts to serious misconduct.

[282] Mr Gelagotis took deliberate steps to exclude Mr S.P. from the lunchroom because he had accepted employment with UGL. The conduct was proscribed by a policy with which he was required to comply. He was a health and safety representative. Mr Kostelnik's reminder to employees of the importance of the policy on 22 June 2017 came after Mr Gelagotis' actions on 15 June 2017; nevertheless, Mr Gelagotis acknowledged that he was aware of the policy, and that breach of the policy could result in dismissal.[322] He had undertaken online refresher training on 29 September 2016.[323] Mr Gelagotis accepted employment with Esso understanding that the policy applied to his employment.[324] The policy prohibited conduct which has the purpose or effect of creating an intimidating, hostile or offensive work environment. Excluding Mr S.P. from the lunchroom because he had accepted employment with UGL contravened the policy, and breached his contract of employment. It contravened an essential term of the contract that governed standards of behaviour in the workplace. Even if this term were considered a non-essential term, the contravention of it was a serious breach. The gravity of the conduct is such as to amount to serious misconduct.

[283] For the purposes of my consideration of s.387, I consider that Esso's summary dismissal of the applicants for these reasons was not disproportionate to their conduct in question.

[170]

[288] The applicants contend that the opening words of clause 22 require Esso to counsel an employee where performance or behaviour falls below acceptable standards. They say that the opening words are mandatory - a supervisor will counsel - and that the clause provides for a series of steps graduating in seriousness and culminating with a third and final warning.

[289] The last paragraph of the clause states that the procedure is designed to protect the rights of the employee, and that it is not intended to diminish the right of the company to dismiss an employee instantly for serious or wilful misconduct. The applicants contend that there is an implication that the clause does diminish the rights of the employer to dismiss for reasons other than serious or wilful misconduct. Accordingly, the applicants say that if conduct falls short of serious misconduct, the counselling process in clause 22 must be applied. It is common ground that the process in clause 22 was not applied in relation to Mr Hatwell and Mr Gelagotis.

[290] It should also be noted that clause 9(a) of the Onshore Agreement states that employment may be terminated by the Company by giving notice in accordance with the Act, or payment in lieu of notice, but this shall not affect the right of the company to dismiss any employee without notice for serious misconduct.

[291] The applicants submit that Esso is not entitled to terminate an employee's employment under clause 9(a) if there is behaviour that engages clause 22, unless it has taken the steps prescribed in that clause. In short, the applicants contend that it is only behaviour that constitutes serious or wilful misconduct that entitles Esso to 'by-pass' the procedure in clause 22 and proceed straight to dismissal.

[292] I do not read clauses 9 and 22 in this way. Clause 9 is cast in general terms and allows the company to terminate on notice as contemplated by the Act. It does not state that it is subject to clause 22, and clause 22 does not state that it derogates from clause 9. Clause 22 says that a supervisor 'will counsel' an employee where performance or behaviour falls below acceptable standards. These standards are defined broadly and inclusively. But the clause then states that counselling will 'normally' take the following form. This suggests that usually, or perhaps in a normal situation (but not always) the form of counselling described in the clause will apply. The applicants say that this goes to the form and content of the counselling, not whether counselling must occur. But if a different 'form' can be adopted, that form might be of a minimal dimension and content. Further, counselling does not necessarily preclude dismissal. A person might be counselled and dismissed.

[293] The last paragraph in clause 22 states that the clause does not diminish the company's right to dismiss an employee for serious misconduct. This suggests that the right to dismiss for other reasons is diminished. But how is it diminished? The succeeding phrase states that 'an employee who is dissatisfied with the way the procedure has been applied may raise the grievance in accordance with the Disputes Procedure_._' If the procedure has been applied, the employee may challenge the application of the procedure. This is the way in which Esso's right to dismiss for conduct short of serious misconduct is curtailed. The 'procedure' might also encompass other forms of counselling that have been adopted, aside from the 'normal' form set out in clause 22.

[294] The clause does not, in my view, say or imply that the employer cannot dismiss an employee on notice unless the counselling procedure has been applied. I note that the reference to clause 9(a) in the second last paragraph of the clause (to the effect that, if there is no improvement, the company can suspend or be free to terminate under clause 9(a)), is in my view simply a statement of fact, not the lifting of a limitation. In any event, this paragraph forms part of the 'normal' counselling procedure, and is not applicable to other forms of counselling that might be used.

[295] As noted earlier, I have concluded that the conduct of the applicants did amount to serious misconduct, and in that circumstance it is common ground that clause 22 of enterprise agreement is not engaged.

At a glance

Court

Decision date

Source

Judgment (396 paragraphs)

Mr Michael Gelagotis v Esso Australia Pty Ltd [2018] FWC 2398 (2 May 2018)

Parties

Legislation Cited (1)

Cases Cited (23)