Fair Work Act 2009

s 604 - Appeal of decisions

Application to appeal a decision of Deputy President Binet on 11 October 2018 in matter U2018/2882 - unfair dismissal application dismissed - dismissal not harsh, unjust or unreasonable - allegations of misconduct against Security Patrol Officer - representation of the parties - both parties agree the matter is complex - denial of procedural fairness - appealable error established - appeal upheld - decision quashed - remitted for hearing.

[1] Pursuant to ss 604 and 400 of the Fair Work Act 2009 (the 'Act'), Mr Neil Emery (the 'appellant') has lodged an application for permission to appeal and appeal of a decision and order of Deputy President Binet at Perth on 11 October 2018; see: Emery v City of Stirling [2018] FWC 4303 (the 'Decision'); PR701253 (the 'Order'). The Deputy President dismissed the appellant's application, filed under s 394 of the Act, in which he had sought an unfair dismissal remedy as a consequence of his dismissal as a Security Patrol Officer by the City of Stirling (the 'City' or the 'respondent') for alleged misconduct. Shortly stated, the misconduct was described as:

'Carry and possession of an extendable baton without endorsement and not following Western Australian legislation that must be complied with under your security officer's licence and the city's internal policy requirements.'

[2] We granted permission to appeal on 1 February 2019, having been satisfied that it was in the public interest to do so; see: Emery v City of Stirling [2019] FWCFB 199 (the 'PTA Decision'). Our summary of the Decision is set out in the PTA Decision at [7] to [20].

[3] The substantive appeal was listed on 19 March 2019 and this decision determines the matter. At the appeal hearing, Mr P Mullally, Agent, Workclaims Australia, appeared for the appellant, and Ms E Hartley, Solicitor, HWL Ebsworth Lawyers, appeared for the City. The parties' representation continued, pursuant to an earlier decision to grant permission for both parties to be represented by a paid agent and a lawyer respectively, pursuant to s 596 of the Act.

[4] In its amended Notice of Appeal, the appellant identified seven grounds of appeal (although Appeal Ground E was not pressed), which may be described in short form, claiming that the Deputy President:

• refused to grant permission for the appellant to be represented by a paid agent - Ground A;

• made no findings of fact to support a finding of valid reason for the dismissal - Ground B;

• permitted the admission of hearsay evidence - Ground C;

• permitted the admission of out of court statements - Ground D;

• erred in finding that the appellant could breach the statutory regime in the future - Ground F; and

• did not take into account the differential treatment afforded to the appellant and another employee - Ground G.

[5] It is apparent that the primary focus of the appellant's appeal is on Ground A, being a procedural matter going to the conduct of the proceedings directly impacting on the outcome in the case. We are satisfied that this appeal ground has been established and that it is sufficient to dispose of this appeal. These are our reasons.

[6] As noted in the PTA Decision, section 596 of the Act deals with representation by lawyers and paid agents in Commission proceedings. While there are some exceptions, a person generally requires permission to be represented by a lawyer or paid agent. The Commission may only grant permission if satisfied as to one of the criteria set out in section 596(2). An identified error in a decision made under s 596 does not necessarily lead to the Decision being quashed; see: New South Wales Bar Association v Brett McAuliffe; Commonwealth of Australia represented by the Australian Taxation Office [2014] FWCFB 1663 and Fitzgerald v Woolworths Limited [2017] FWCFB 2797 ('Fitzgerald'). However, for the reasons we set out below, we consider that this case is one where that is the appropriate course.

[7] There is no dispute in this matter that both parties sought to be represented in the determinative conference and did not oppose the other being represented. Permission was refused in each case. The Deputy President was not, of course, bound to accept the consent position of the parties. The Deputy President was required to make an independent determination on the statutory tests in s 596(2) of the Act. That being said, we would observe that often Commission hearings (or in the case, a determinative conference) dealing with unfair dismissal involve a degree of complexity and can proceed more efficiently and effectively if parties have already agreed on such procedural matters as an Agreed Statement of Facts, the order of witnesses, whether witnesses are required for cross examination, and other like procedural matters. Where both parties agree that a matter is complex and would be dealt with more efficiently with representation, their views should be given appropriate weight in the exercise of discretion under s 596 of the Act.

[8] It is plainly apparent that the Deputy President's decision allowed the parties to be represented for the purposes of preparing submissions and witness statements and for both parties to be represented in the MAC and even in preparing final submissions (PN13). It is difficult to reconcile these steps with her decision to deny representation at the determinative conference. It might be inferred that the Deputy President did so for the benefit of the parties and to assist in having the case prepared efficiently, having regard to its complexity. If this was so, it is difficult to understand what prompted the different treatment of representation for the purpose of the conference.

[9] We note there is no distinction drawn, for the purposes of s 596, between matters conducted by way of hearing or determinative conference. Convening a determinative conference, rather than a hearing, does not alter the evidentiary foundation required to establish the relevant facts, making findings on conflicting evidence, and analysing and applying all the facts and circumstances to the statutory provisions.

[10] In this case, matters in contest encompassed not only provisions of the Act, but also alleged breaches of the Security and Related Activities (Control) Act 1996 (WA), the Weapons Act 1999 (WA) and its Regulations, and the City's policies and procedures. It involved considerations unique to the security industry which are not commonly encountered in unfair dismissal matters.

[11] In our opinion, it was a legally complex case and it was open to the Deputy President to exercise her discretion in favour of representation for the purposes of the conference. We are satisfied that there may have been a different outcome in the case if permission been granted to the parties. So much is evident from the various exchanges between the Deputy President and the appellant as to the conduct of proceedings, as we observed in the PTA Decision. The appellant was clearly unfamiliar with and confused by the evidentiary process, as demonstrated in his exchange with the Deputy President concerning the admissibility of Mr Cappa and Mr Almond's statements. The appellant objected to their statements being admitted, but was at a disadvantage as to how to argue his objection effectively. The Deputy President also had to caution the City's representative for leading a witness (PN302).

[12] There are also three other matters relevant to whether the Deputy President erred in refusing representation to the appellant:

• (a) The chronology of events leading to the email from the Deputy President's Chambers on 25 June 2018 was, with respect, confusing. Directions had been issued, which included submissions on permission to be represented, and then reissued in full, but without reference to submissions on permission to be represented. Given what had occurred with both parties being actively represented, it was not unreasonable for the parties to assume that permission to be represented at the determinative conference would be granted.

• (b) Mr Mullally submitted that the Deputy President could not have made the decision to refuse permission to be represented based on his observations of the parties during the conciliation. This was because the appellant did not speak during the conference. He had relied on Mr Mullally to put his position. Ms Hartley did not dispute this fact. If that is what occurred, the Deputy President's conclusion based on her observations of the appellant in conciliation, when he had not been an active participant, appears to us to have been a significant error of fact.

• (c) It is apparent that the Deputy President refused permission for the appellant to be represented by focussing on her view that the matter had to that point, not been dealt with efficiently by Mr Mullally's involvement, because of his failure to file the appellant's submissions in accordance with her directions, or seek an extension of time. Putting aside whether this reason was justified, with respect, we consider the Deputy President focussed on the wrong question. The question should not have been about the conduct of Mr Mullally, but rather, whether the matter would be dealt with more efficiently, having regard for its complexity, if the parties were represented. This was a discretionary error which resulted in a denial of procedural fairness.

[13] Further, in our view, focussing on efficiency without reference to the matter's complexity, was also an error. The correct test under s 596(2)(a) is whether the matter will be able to be dealt with more efficiently, taking into account its complexity. In other words, the complexity of a matter is a mandatory consideration. It is not apparent that the Deputy President considered the question of representation by giving effect to the correct statutory context.

[14] In Adrian Tainsh v Toyota Motor Corporation Australia Limited t/a Toyota [2018] FWCFB 7565 ('Tainsh'), the Full Bench of the Commission said at [44]-[46]:

'[44] It is well established that members of the Commission are required to act in a judicial manner and accord all parties procedural fairness. This duty must be applied in the context of the particular circumstances including the nature of representation and the nature of the matter before the Commission. In Coal & Allied Mining Services v Lawler, 44 Buchanan J said:

'There is no doubt that members of FWA are (as were members of its statutory predecessors, the Commonwealth Conciliation and Arbitration Commission and the Australian Industrial Relations Commission ("the AIRC")) bound to act "judicially" in the sense that they are obliged to respect and apply traditional notions of procedural fairness and impartiality. (See Re Australian Bank Employees Union; Ex parte Citicorp Australia Ltd [1989] HCA 41; (1989) 167 CLR 513 at 519, citing R v Commonwealth Conciliation and Arbitration Commission; Ex parte Angliss Group (1969) 122 CLR 546 at 552; R v Moore; Ex parte Victoria [1977] HCA 58; (1977) 140 CLR 92 at 101-102. See also Re Polites; Ex parte Hoyts Corporation Pty Limited (1991) 173 CLR 78; Re Finance Sector Union of Australia; Ex parte Illaton Pty Ltd [1992] HCA 30; (1992) 66 ALJR 583). However, it is an important aspect of the work of FWA, at all levels including on appeal (as it was of its statutory predecessors), that it is to proceed without unnecessary technicality and as informally as the circumstances of the case permit. FWA is not a court and its members are not judicial officers as such (although the President has the same status as a judge of this Court and some senior members of FWA retain an equivalent status from earlier statutory arrangements). It is not inappropriate to say that the members of FWA have a statutory mandate to get to the heart of matters as directly and effectively as possible.'

[15] We are satisfied that the appellant was denied procedural fairness in the proceedings at first instance. We cannot be satisfied that the denial of procedural fairness would not have had the potential or likelihood of a different outcome in the case. Ms Hartley submitted that the appellant had not demonstrated how the errors he had identified, would have led to a different outcome had the error/s not been made (without conceding there were errors or that they were significant). It is not necessary in an appeal to demonstrate that had an error not been made, it would have led to a different outcome. It is only necessary to establish that there was a potential or possibility that a different outcome would have been the result. We are satisfied that the errors we have earlier identified were significant; had they not been made, a different outcome was a likely possibility.

[16] Accordingly, Grounds A and B of the Notice to Appeal are upheld.

[17] Mr Mullally submitted that the statements of Mr Almond and Mr Cappa, attached to Ms Fairman's statement, should not have been accepted into evidence. If they were, the appellant should have been given an opportunity to cross examine Mr Almond and Mr Cappa, particularly in respect to the ownership of the baton.

[18] It is well established that while the Commission is not bound by the rules of evidence, it tends to follow them as a general guide to good procedure. However, what is ultimately required is judicial fairness. What is fair in a particular case will depend on the circumstances; see: Tainsh above and Pearse v Viva Energy Refining Pty Ltd [2017] FWCFB 4701 at [14]. Hearsay evidence would not ordinarily be relied upon in circumstances where the opposing party is denied an opportunity to contradict that evidence by presenting their own evidence to the contrary; see: Enterprise Flexibility Test Case May 1995 (1995) 59 IR 430.

[19] Neither Mr Almond nor Mr Cappa were witnesses in the proceeding. Their evidence, such as it was, came in the form of statements provided to the respondent as part of its investigation of the baton incident. Those statements included hearsay evidence.

[20] The actual statements of Mr Almond and Mr Cappa are not definitive about the ownership of the baton. Mr Almond said he was told by Mr Cappa 'yeah that is Neil's'. Mr Cappa said he thought it belonged to the appellant, because he had asked him (Mr Cappa) to put it in his (the appellant's) locker.

[21] The Deputy President's consideration of the evidence as to the ownership of the baton is recorded in [34]-[35] of the Decision as follows:

'[34] On 22 January 2018, the City located the baton in Mr Emery's locker, after its presence was reported by Mr Almond. According to Ms Fairman, an investigation on 22 January 2018 revealed that Mr Almond discovered the baton in a pouch in the driver's side storage compartment of the vehicle and that he had asked his Team Leader, Mr Cappa, if he knew who the baton belonged to. In a statement prepared on 6 February 2017, Mr Almond says that Mr Cappa told him 'yeah that is Neil's'.

[35] According to Ms Fairman, when questioned on 22 January 2018, Mr Cappa admitted that he took possession of the baton and placed it in the locker of the person it belonged to and told that person that they should take the baton home. Ms Fairman says that Mr Cappa initially refused to identify the person to whom the baton belonged and offered to resign rather than 'dob'. She says Mr Cappa admitted that he had done the wrong thing in failing to report the baton, but that it was not safe while on duty, so he understood why an officer might feel it necessary to carry a baton. According to Ms Fairman, Mr Cappa told her he did not want to reveal the identity of the owner of the baton because that individual had looked out for him since Mr Cappa started employment with the City.' (footnotes omitted)

[22] In the proceedings below, the appellant insisted he had found the baton and had intended to turn it over to the Police. On one view, the issue of the baton's ownership is not relevant to the finding of misconduct, which was that the baton was in the appellant's possession, regardless of whether he found it, or owned it. However, it was a 'live' issue as far as the appellant was concerned and he was entitled to an opportunity to contradict the evidence of Mr Almond and Mr Cappa on the issue.

[23] It is a matter of record that the appellant was given such an opportunity in relation to Mr Cappa. He gave direct evidence about his discussions with Mr Cappa and denied owning the baton. The same cannot be said for the evidence of Mr Almond. As neither Mr Cappa nor Mr Almond were witnesses in the proceeding, there was no opportunity to cross-examine them. In other words, their evidence was not able to tested.

[24] The Deputy President noted during the conference that the appellant had not sought orders for either Mr Almond or Mr Cappa to attend and give evidence in the proceeding. However, it was the respondent who sought to rely on their statements as part of its defence and who chose not to call them. In our view, the hearsay evidence introduced by the respondent about who owned the baton and how it came to be in the appellant's possession, is likely to have informed, or at least influenced the conclusions reached by the Deputy President. In circumstances where the appellant (while unrepresented) objected to the introduction of Mr Almond and Mr Cappa's evidence, the weight to be attributed to that evidence was a material consideration, having regard to the direct evidence of the appellant to the contrary. It is not apparent on the face of the Decision that the matter was given any relevant weight. In our view, this was an error in the exercise of discretion of the kind described in House v King (1936) 55 CLR 499 ('House v King'). We uphold Grounds C and D of the appeal.

[25] At [99] of the Decision, the Deputy President found that the appellant had shown no contrition or remorse for his conduct. This would mean that there would be a potential risk to the City in that he would likely engage in similar behaviour (if he was reinstated). Mr Mullally raised a Browne v Dunn objection in that this proposition had never been put to the appellant and, in any event, had not been part of the respondent's original case. While we accept there was an evidentiary basis for the Deputy President's finding, the evidence in this respect could not be said to be highly persuasive.

[26] Ms Nobbs at [34] of her statement had merely said 'he did not show any contrition or remorse' and Ms Fairman similarly said 'I was surprised he had not admitted any wrongdoing'. Mr Beard had only said in his statement at [85]: '(his) employment should be terminated, as he posed a risk that I did not want in the workplace.' Neither Ms Fairman, Ms Nobbs, or Mr Beard were questioned by the appellant, nor did the respondent refer to this evidence in their final submissions. We uphold this ground of appeal. It is a matter which may properly be considered in a rehearing of this application.

[27] As to differential treatment between Mr Cappa and the appellant, we are satisfied that the Deputy President had a sufficient basis for her reasons to distinguish the differential treatment the City accorded to Mr Cappa compared to the appellant. In Sexton at [36], Lawler VP dealt with the question of differential outcomes in unfair dismissal cases as follows:

'[36] In my opinion the Commission should approach with caution claims of differential treatment in other cases advanced as a basis for supporting a finding that a termination was harsh, unjust or unreasonable within the meaning of s.170CE(1) or in determining whether there has been a "fair go all round" within the meaning of s.170CA(2). In particular, it is important that the Commission be satisfied that cases which are advanced as comparable cases in which there was no termination are in truth properly comparable: the Commission must ensure that it is comparing "apples with apples". There must be sufficient evidence of the circumstances of the allegedly comparable cases to enable a proper comparison to be made. Obviously, where, as in National Jet Systems, there is differential treatment between persons involved in the same incident the Commission can more readily conclude that the cases are properly comparable. However, even then the Commission must approach the matter with caution. Specifically, the Commission must be conscious that there may be considerations subjective to the circumstances of an individual that caused an employer to take a more lenient approach in an allegedly comparable case. For example, a worker guilty of particular misconduct justifying termination might be shown leniency because of extreme need or stress arising from the serious illness of a close dependent. Another worker guilty of the same misconduct could not necessarily rely upon the leniency shown to the first worker as a basis for demonstrating that his or her termination was harsh, unjust or unreasonable. Many other examples could be constructed.'

[28] The Deputy President's reasons in this respect are set out at [143]-[144]:

'[143] The advancement of a claim that a dismissal is harsh, unjust or unreasonable as a consequence of differential treatment between an applicant and other employees involved in the same incident must be approached with caution.

"In particular, it is important that the Commission be satisfied that the cases which are advanced as comparable cases in which there was no termination are in truth properly comparable: the Commission must ensure that it is comparing 'apples with apples'."

[144] Mr Cappa was contrite when his involvement in the incident was raised with him. He initially offered to resign. The City suggested that he instead participate in an investigation which on all accounts he did willingly, notwithstanding his initial reluctance to 'dob on a mate'. Mr Cappa acknowledged that his failure to report the presence of the baton to management was inappropriate, and also said that he would handle the same situation differently in the future. Mr Cappa was ultimately given a first and final warning and demoted as a Team Leader. I am not satisfied that the treatment of Mr Cappa as compared to Mr Emery is such as to render Mr Emery's dismissal harsh, unjust or unreasonable.'

[29] We do not discern any relevant error in this weighing up of the evidence in relation to the different treatment as between the appellant and Mr Cappa. This ground of appeal is not made out.

[30] For the reasons set out above, the Decision is affected by error. We have decided to uphold the appeal and quash the Decision of the Deputy President.

[31] Given our findings in the appeal it is not appropriate to determine the application to finality for ourselves. There may be questions as to the admission of evidence and cross examination of witnesses, which can be effectively dealt with by a single member on remittal.

[32] We make the following orders:

• The appeal is upheld except in relation to Grounds E and G;

• The Decision in Emery v City of Stirling [2018] FWC 4303 is quashed; and

• Matter U2018/2882 is remitted to the Region 3 Regional Coordinator for allocation to another member for rehearing.

P Mullally, Agent, Workclaims Australia for the appellant

E Hartley, Solicitor, HWL Ebsworth Lawyers for the respondent

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