Application for a remedy in relation to termination of employment - certificate issued - no reasonable prospect of success - whether decision to issue certificate affected by error - whether termination at the initiative of the employer - Workplace Relations Act 1996 ss45,170CE and 170CF .

[1] This is an appeal, for which leave is required, by Paul O'Meara (the appellant) against a certificate issued by Commissioner Raffaelli on 15 May 2006 under s.170CF(4) of the Workplace Relations Act 1996 (the Act). The appellant had applied pursuant to s.170CE of the Act for relief in relation to the termination of his employment. The certificate stated that the application had no reasonable prospect of success at arbitration. The statutory effect of such a certificate is that the application is dismissed.

[2] By force of reg.4.3 and reg.4.11 of Chapter 7, Part 4 of the Workplace Relations Regulations 2006 the appeals are to be determined pursuant to the provisions of the Act as in force prior to the coming into operation of the Workplace Relations Amendment (Work Choices) Act 2005.

[3] The appeals concern the operation of s.170CF of the Act. Section 170CF is as follows:

(1) When an application is lodged with the Commission, the Commission must attempt to settle the matter to which the application relates by conciliation.

(2) If the Commission is satisfied that all reasonable attempts to settle the matter by conciliation are, or are likely to be, unsuccessful so far as concerns at least one ground of the application, the Commission:

(a) must issue a certificate in writing stating that it is so satisfied in respect of that ground or each such ground; and

(b) must indicate to the parties the Commission's assessment of the merits of the application in so far as it relates to that ground or to each such ground; and

c) if the Commission thinks fit, may recommend that the applicant elect not to pursue a ground or grounds of the application (whether or not also recommending other means of resolving the matter); and

(d) if the Commission considers, having regard to all the materials before the Commission, that the application has no reasonable prospect of success, it must advise the parties accordingly.

(a) the ground or one of the grounds of the application is the ground referred to in paragraph 170CE(1)(a); and

(b) the Commission has indicated that the applicant's claim in respect of the ground so referred has no reasonable prospect of success;

the Commission must invite the applicant to provide further information in support of that ground within a period specified by the Commission.

(4) If, in relation to an application to which subsection�(3) applies:

(a) the applicant does not provide further information regarding the applicant's claim in respect of the ground referred to in paragraph 170CE(1)(a); or

(b) after consideration of the original application and the further material provided by the applicant in support of that ground;

the Commission concludes that the application has no reasonable prospect of success at arbitration, it must issue a certificate to that effect.

(5) If the Commission issues a certificate under subsection�(4) in respect of an applicant's claim in respect of the ground referred to in paragraph 170CE(1)(a), the application is dismissed, insofar as it relates to that ground, with effect from the date of issue of the certificate."

[4] The appellant was employed by Stanley Works Pty Ltd (the employer) from 10�August 2000 until the termination of his employment in February 2006. He lodged an application for relief in relation to the termination on 25 February 2006. At a conciliation conference convened by the Commission on 10 April 2006 Commissioner Raffaelli indicated that he considered that the application had no reasonable prospect of success at arbitration. He subsequently wrote to the parties to inform them of this view and invited the appellant to provide further information in support of the application under s.170CF(3) of the Act. The appellant's solicitors responded to the Commissioner by letter dated 13 April 2006. They indicated on behalf of their client that they saw no reason to provide further information, but nevertheless took the opportunity to re-state and clarify the submissions that had already been put to the Commission in the conciliation conference.

[5] Counsel for the employer objected to us having regard to the letter from the appellant's solicitor dated 13 April 2006. The objection was based principally on the terms of s.104(5) of the Act. We decided to admit the letter. While it referred to what had transpired in conciliation we concluded that s.104(5) does not apply to these proceedings. Furthermore the letter was furnished in response to a request from the Commission pursuant to s.170CF(3). Without having regard to the contents of the letter it would be practically impossible to give proper consideration to the appeal. While it is important to protect the privilege which is traditionally accorded to what is said and done in conciliation, the conclusion we reached was dictated by the terms of the legislation and the circumstances.

[6] On 15 May 2006 the Commissioner issued a certificate in the following terms:

"This certificate is issued pursuant to the provisions of section 650 of the Workplace Relations Amendment (WorkChoices) Act 2005. However, given that the application was lodged prior to the amendment to the Workplace Relations Act 1996 (the Act) reference will be made to relevant provisions of the Act.

In accordance with subsection 170CF(2) of the Act, the Commission hereby certifies that all reasonable attempts to settle the matter by conciliation have been unsuccessful.

The Commission has advised the parties that it considers, having regard to all the materials before it, that the application, in so far as it is based on the ground that the termination was harsh unjust or unreasonable (section 170CE(1)(a)), has no reasonable prospect of success.

Having invited the applicant to provide such further information in support of the application under subsection 170CF(3) of the Act, and after consideration of the material and such further information as provided by the applicant, the Commission concludes that the application has no reasonable prospect of success at arbitration.

The application is therefore dismissed insofar as the application relates to s.170CE(1)(a) of the Act with effect from the date of issue of this certificate."

[7] No party made an application to the Commissioner for reasons to be issued pursuant to Rule 46 of the Australian Industrial Relations Commission Rules 1998.

[8] The grounds of appeal are expressed as follows:

a) failing to make any or any reasonable attempt to settle the matter by conciliation; and, or in the alternative, by

b) hindering the prospect of successful conciliation

- in that, at a conciliation conference that was held on 7 April 2006, he:

i) Failed to make any attempt to engage the parties in settlement discussions

ii) Encouraged the respondent's representatives to reject the only settlement offer that was made on behalf of the applicant

iii) Made disparaging comments about the perceived merits of the applicant's case and the applicant's purported reason for bringing the application, in the presence of the respondent's representatives

iv) Failed to talk to the parties separately as is customary in conciliation conferences.

2) The learned Commissioner erred by making findings of fact and law (if he did) in relation to factual and legal issues that were in dispute between the parties.

3) The learned Commissioner erred in finding that all reasonable attempts to settle the matter by conciliation were, or were likely to be, unsuccessful.

4) The learned Commissioner erred in failing to apply the correct legal principles, alternatively by failing to apply those principles correctly, to the task of assessing the merits of the applicant's case." [1]

[9] On 6 February 2006 the appellant sent a letter to the employer's warehouse manager in the following terms:

I would like to resign from as Store man at Stanley Works.

I have been concerned for sometime about health and safety not being taken seriously by management, and wish again to draw attention that I have already sustained two injuries.

I feel I will sustain more injuries if I remain, and am leaving for that reason.

There are certain people who are dangerous and should be cautioned. As the situation remains I have no alternative but resign.

I am retaining a coy of this for future action with Occupational Health and Safety people and hope you will change as others may be injured due to lack of inaction.

Signed, With Regret [signature] (Paul O'Meara)" [2]

[10] On its face the letter indicates that the appellant resigned his employment. The appellant's position, however, is that the termination of employment was a constructive dismissal by the employer. The basis for that contention, as explained in the appellant's solicitors' letter of 13 April 2006, was that the employer "had repeatedly breached its duty to provide a safe workplace" for the appellant and that the employer's "negligence with respect to its OH&S obligations:

• caused the applicant to be physically injured on at least two occasions (and noting that the applicant is still not recovered from those injuries); and

• caused the applicant to be assaulted by his supervisor; and

• placed him at risk of serious injury on other occasions." [3]

[11] It was further contended that the employer's conduct "was so serious that it amounted to a repudiation of the employment contract, which ultimately caused the applicant to cease his employment." [4]

[12] The letter recorded the position taken by the employer in the conciliation conference as follows:

"In reply, the respondent contended that, although it may have had OH&S issues in the past when it was located at other premises, it had substantially improved its performance since moving to new premises. The applicant's allegations were denied in general terms, and the respondent pointed to matters which it said supported the view that its OH&S performance was now quite sound. The respondent said that the applicant had been given ample opportunity to retract his resignation. In respect of the alleged assaults against the applicant, the respondent's representative admitted that he had no instructions." [5]

[13] The letter also contained an allegation that the Commissioner had erred in reaching the view that all reasonable attempts to settle the matter by conciliation were, or were unlikely to be, successful.

[14] Although there is no specific indication of the Commissioner's reasons for reaching the conclusion expressed in the certificate, it seems clear enough that the Commissioner formed the view that the appellant would not be able to establish that the termination of his employment was at the initiative of the employer. A termination of employment which is not at the initiative of the employer does not give rise to a remedy under s.170CE of the Act.

[15] The principles to be applied in relation to the issue of a certificate under s.170CF(4) are discussed at considerable length in the Full Bench decision of Wright v Australian Customs Service [6] (Wright). Those principles were recently applied by this Full Bench in Dauer & Herra v Australian Future Communications.[7]

[16] As we have indicated, although the Commissioner did not give reasons for his conclusion it is clear enough that he took the view that if the application went to arbitration the appellant would not be able to establish that his employment was terminated at the initiative of the employer. In that case the application was bound to fail.

[17] Whether there is a termination at the initiative of the employer is a jurisdictional fact. Equally a conclusion under s.170CF(4) that an application has no reasonable prospect of success involves the exercise of a discretion. In this regard we adopt, with respect, the following passage from the joint judgment of Gleeson CJ, Gaudron and Hayne JJ in Coal and Allied Operations v AIRC [8]:

"'Discretion' is a notion that 'signifies a number of different legal concepts' [Norbis v Norbis (1986) 161 CLR 513 at 518 per Mason and Deane JJ]. In general terms, it refers to a decision-making process in which 'no one [consideration] and no combination of [considerations] is necessarily determinative of the result.' [Jago v District Court (NSW) (1989) 168 CLR 23 at 76 per Gaudron J] Rather, the decision-maker is allowed some latitude as to the choice of the decision to be made [See Jago v District Court (NSW) (1989) 168 CLR 23 at 75-76 per Gaudron J; Russo v Russo [1953] VLR 57 at 62 per Sholl J. See also Pattenden, Judicial Discretion and Criminal Litigation, 2nd ed (1990) at 5-6]. The latitude may be considerable as, for example, where the relevant considerations are confined only by the subject-matter and object of the legislation which confers the discretion [Water Conservation and Irrigation Commission (NSW) v Browning (1947) 74 CLR 492 at 504-505 per Dixon J; R v Australian Broadcasting Tribunal; Ex parte 2HD Pty Ltd (1979) 144 CLR 45 at 49]. On the other hand, it may be quite narrow where, for example, the decision-maker is required to make a particular decision if he or she forms a particular opinion or value judgment." [9]

[18] Because this is an appeal from a discretionary decision it follows that it is to be dealt with in accordance with the principles outlined in House v R. [10] According to those principles an appeal can only succeed if the decision is affected by error in the relevant sense. As noted in Wright, the assessment under s.170CF(4) is based in substance on the case alleged by the applicant. Necessarily, that assessment is made without the benefit of a full hearing and in particular without sworn evidence or findings on contested issues. Nevertheless, both the applicant and the respondent have a responsibility to put forward the basis of their respective cases in conciliation. The employee also has the opportunity to put additional information to an invitation under s.170CF(3). For the employer the role will primarily be performed at the conciliation conference.

[19] The circumstances in which a resignation, while apparently a termination of employment by the employee, nevertheless constitutes a termination at the initiative of the employer, have been considered in a number of cases. A prominent authority is the decision of a Full Court of the Federal Court of Australia in Mohazab v Dick Smith Electronics Pty Ltd [11] (Mohazab). In that case, the employer made a threat that unless the employee resigned the employer would ask the police to charge the employee with an offence. The analysis of the concept of termination at the initiative of the employer by the Court in that case has not always been quoted in full. It is desirable that we do so in this case. After referring to dictionary definitions of the term "initiative" and the convention giving rise to the statutory provisions, the Full Court said:

"These definitions reflect the ordinary meaning of the word 'initiative'. Viewed as a whole, the Convention is plainly intended to protect workers from termination by the employer unless there is a valid reason for termination. It addresses the termination of the employment relationship by the employer. It accords with the purpose of the Convention to treat the expression 'termination at the initiative of the employer' as a reference to a termination that is brought about by an employer and which is not agreed to by the employee. Consistent with the ordinary meaning of the expression in the Convention, a termination of employment at the initiative of the employer may be treated as a termination in which the action of the employer is the principal contributing factor which leads to the termination of the employment relationship. We proceed on the basis that the termination of the employment relationship is what is comprehended by the expression 'termination of employment': Siagian v Sanel [1994] IRCA 2; (1994) 1 IRCR 1 at 19; 54 IR 185 at 201. In many, if not most, situations the act of the employer that terminates the employment relationship is not only the act that puts in train the process leading to its termination but is, in substance, the entire process. An example would be a situation where the employer decided to dismiss an employee and did so orally or in writing with immediate effect. Other situations may be more complex as exemplified by the circumstances considered by Moore J in Grout v Gunnedah Shire Council (1994) 1 IRCR 143; 57 IR 243 where an employee had given written notice purporting to terminate the employment relationship. The notice was not reasonable but was accepted by the employer which later refused to allow the employee to withdraw the notice. A question arose as to whether that was a termination of the employment at the initiative of the employer and his Honour held it was. His Honour said at 160-161; 259:

'I have already said that Div 3 concerns termination at the initiative of the employer. The respondent submits that "initiate" means "to begin, commence, enter upon; to introduce, set going, or initiate": see Shorter Oxford English Dictionary. In this matter, it is submitted, it was the applicant and not the respondent that initiated the termination by writing the letter of 18 May. This, in my opinion, gives the expression "termination" in the Act, read in conjunction with Art 3 of the Convention which speaks of "termination … at the initiative of the employer", a narrow meaning that was not intended. A principal purpose, if not the sole purpose, of Div 3 is to provide an employee with a right to seek a remedy in circumstances where the employee did not voluntarily leave the employment. An employee may do some act which is the first in a chain of events that leads to termination. An example would be an employee who engaged in misconduct at work which ultimately led to the employer dismissing the employee. However, that situation and the present are not situations where the termination was at the initiative of the employee. In both instances the step or steps that effectively terminated the employment or purported to do so were taken by the employer.'

In these proceedings it is unnecessary and undesirable to endeavour to formulate an exhaustive description of what is termination at the initiative of the employer but plainly an important feature is that the act of the employer results directly or consequentially in the termination of the employment and the employment relationship is not voluntarily left by the employee. That is, had the employer not taken the action it did, the employee would have remained in the employment relationship. This issue was addressed by Wilcox CJ in APESMA v David Graphics Pty Ltd (unreported, Industrial Relations Court of Australia, 12 July 1995, Wilcox CJ). His Honour, at p 3, referred to the situation of an employee who resigned because 'he felt he had no other option'. His Honour described those circumstances as:

'… a termination of employment at the instance [of] the employer rather than of the employee.'

'I agree with the proposition that termination may involve more than one action. But I think it is necessary to ask oneself what was the critical action, or what were the critical actions, that constituted a termination of the employment.'" [12]

[20] Moore J, one of the members of the Full Court in Mohazab, addressed the question further in Rheinberger v Huxley Marketing Pty Limited [13] (Rheinberger). His Honour said, after referring to extracts from Mohazab:

"However it is plain from these passages that it is not sufficient to demonstrate that the employee did not voluntarily leave his or her employment to establish that there had been a termination of the employment at the initiative of the employer. Such a termination must result from some action on the part of the employer intended to bring the employment to an end and perhaps action which would, on any reasonable view, probably have that effect. I leave open the question of whether a termination of employment at the initiative of the employer requires the employer to intend by its action that the employment will conclude. I am prepared to assume, for present purposes, that there can be a termination at the initiative of the employer if the cessation of the employment relationship is the probable result of the employer's conduct." [14]

[21] In this Commission the concepts have been addressed on numerous occasions and by a number of Full Benches. In Pawel v Advanced Precast Pty Ltd [15] (Pawel) a Full Bench said:

"[13] It is plain that the Full Court in Mohazab considered that an important feature in the question of whether termination is at the initiative of the employer is whether the act of an employer results directly or consequentially in the termination of the employment and that the employment relationship is not voluntarily left by the employee. However, it is to be noted that the Full Court described it as an important feature. It plainly cannot be the only feature. An example will serve to illustrate this point. Suppose an employee wants a pay rise and makes such a request of his or her employer. If the employer declines and the employee, feeling dissatisfied resigns, can the resignation be said to be a termination at the initiative of the employer? We do not think it can and yet it can be said that the act of the employer i.e. refusing the pay rise, has at least consequentially resulted in the termination of the employment. This situation may be contrasted with the position where an employee is told to resign or he or she will be terminated. We think that all of the circumstances and not only the act of the employer must be examined. These in our view, will include the circumstances giving rise to the termination, the seriousness of the issues involved and the respective conduct of the employer and the employee. In the instant case the uncontested factual findings are that the applicant had for almost the whole of his employment performed welding duties; that there was no objective threat to his health and safety involved in the requirement that he undertake welding duties so long as it was not on a continuous basis and that the welding he was required to do was not continuous." [16]

[22] In the Full Bench decision of ABB Engineering Construction Pty Ltd v Doumit [17] (ABB Engineering) it was said:

"Often it will only be a narrow line that distinguishes conduct that leaves an employee no real choice but to resign employment, from conduct that cannot be held to cause a resultant resignation to be a termination at the initiative of the employer. But narrow though it be, it is important that that line be closely drawn and rigorously observed. Otherwise, the remedy against unfair termination of employment at the initiative of the employer may be too readily invoked in circumstances where it is the discretion of a resigning employee, rather than that of the employer, that gives rise to the termination. The remedies provided in the Act are directed to the provision of remedies against unlawful termination of employment. Where it is the immediate action of the employee that causes the employment relationship to cease, it is necessary to ensure that the employer's conduct, said to have been the principal contributing factor in the resultant termination of employment, is weighed objectively. The employer's conduct may be shown to be a sufficiently operative factor in the resignation for it to be tantamount to a reason for dismissal. In such circumstances, a resignation may fairly readily be conceived to be a termination at the initiative of the employer. The validity of any associated reason for the termination by resignation is tested. Where the conduct of the employer is ambiguous, and the bearing it has on the decision to resign is based largely on the perceptions and subjective response of the employee made unilaterally, considerable caution should be exercised in treating the resignation as other than voluntary." [18]

[23] In our view the full statement of reasons in Mohazab which we have set out together with the further explanation by Moore J in Rheinberger and the decisions of Full Benches of this Commission in Pawel and ABB Engineering require that there to be some action on the part of the employer which is either intended to bring the employment to an end or has the probable result of bringing the employment relationship to an end. It is not simply a question of whether "the act of the employer [resulted] directly or consequentially in the termination of the employment." [19] Decisions which adopt the shorter formulation of the reasons for decision should be treated with some caution as they may not give full weight to the decision in Mohazab. In determining whether a termination was at the initiative of the employer an objective analysis of the employer's conduct is required to determine whether it was of such a nature that resignation was the probable result or that the appellant had no effective or real choice but to resign.

[24] In this case the appellant wrote a letter on NUW letterhead resigning from his employment. It is not a situation of a 'heat of the moment' reaction, but rather one that appears to have been taken at least with the opportunity of obtaining advice. The letter referred to a long-standing concern that management did not take health seriously, drew attention to injuries which had been sustained and indicated that his apprehension of further injury had led to his resignation. The letter went on to state that there were certain people who were dangerous and should be cautioned and that the appellant had no alternative but to resign.

[25] The Commissioner indicated a preliminary view that the appellant had resigned voluntarily. He then provided the appellant, in accordance with the legislative requirement, with an opportunity to produce information which might persuade the Commissioner that his preliminary view was wrong. The response did not greatly assist the appellant's case. The appellant questioned whether there was any reason to provide further information, contended that no reasonable attempt had been made to settle the matter by conciliation, and re-stated matters raised at the conciliation conference. Neither in the letter of 13 April 2006 nor elsewhere did the appellant provide information or allegations which tended to indicate that the resignation was other than voluntary. No specific allegations about the employer's conduct in relation to occupational health and safety were made, apart from the earlier reference to an unspecified assault by a supervisor. Nor was it indicated how the relevant connection between the employer's alleged attitude to health and safety and the employee's resignation was to be established. It is relevant in this regard that the appellant was represented by legal practitioners. When faced with the Commissioner's indication of a preliminary view adverse to his prospects of success and given an opportunity to provide further material, the appellant was clearly on notice that more material was needed. The fact that it was not forthcoming is significant.

[26] Taking all of the material of which we are aware into account we think it was open to the Commissioner to conclude that there was no reasonable prospect of the appellant succeeding in demonstrating that the employer's conduct was of such a character.

[27] We have considered all of the grounds of appeal. None of them discloses any appealable error. Apart from what we have already said it is only necessary to comment on the other primary ground, namely: the ground which alleges that the Commissioner erred by failing to make any or any reasonable attempt to settle the matter by conciliation and, or in the alternative, by hindering the prospect of successful conciliation. We have set out the terms of s.170CF(1) and (2) earlier. Section 170CF(1) relevantly requires the Commission to attempt to settle the application by conciliation. Section 170CF(2) requires the Commission to issue a certificate if it is "satisfied" that "all reasonable attempts to settle the matter by conciliation are, or are likely to be, unsuccessful." It is clear that these provisions leave a great deal to the judgment of the member of the Commission to whom the matter is allocated for conciliation. Unless there is some patent failure on the part of the member to exercise the discretion appropriately, an appeal bench would be reluctant to disturb a conclusion that conciliation or further conciliation would be unlikely to resolve the matter. It would clearly be contrary to the public interest and potentially wasteful of resources if conclusions of this kind were liable to be set aside on appeal without good grounds for doing so. Members of the Commission should not be discouraged from exercising their judgment in an efficient and timely manner by an apprehension of close scrutiny at the appellate level. It is sufficient if we indicate that in this case no good grounds were advanced.

[28] The appellant has not established that the Commissioner erred in concluding that the case had no reasonable prospect of success at arbitration. Because the appeal raised issues relating to the application of s.170CF(4) we grant leave to appeal, but, for the reasons given, we dismiss the appeal.

[6] PR926115 at paragraphs 29-34.

[8] [2000] HCA 47; 174 ALR 585 at 591.

[10] [1936] HCA 40; (1936) 55 CLR 499.

[11] (1995) 62 IR 200.

[13] (1966) 67 IR 154.

[15] Print S5904, 12 May 2000 per Polites SDP, Watson SDP and Gay C.

[17] Print N6999, 9 December 1996 per Munro J, Duncan DP and Merriman C; quoted with approval in BC Stubbs v Austar Entertainment Pty Ltd, Print Q0008, 17 December 1998 per Ross VP, Munro J and Harrison C and in Mosey v Australian Customs Service (2002) 116 IR 1.

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