[1] This is an appeal, for which leave is required, by Robert Alberto Caspanello (the appellant) against the decision of Commissioner Hingley on 10 July 2002.[1] In that decision, the Commissioner found that the appellant's termination of the applicant's employment by Telstra Corporation Limited (the respondent) on 19 November 2001 was not harsh, unjust or unreasonable and dismissed the appellant's application for relief under s.170CE of the Workplace Relations Act 1996 (the WR Act).

[2] The factual circumstances leading up to the termination are set out in the Commissioner's decision. Briefly, for the purposes of this decision, they may be summarised as follows -

· the appellant was employed by the respondent for some twelve years;

· at the time of the termination of his employment, he was employed as a technician with commuter rights to a vehicle;

· the respondent had warned the appellant on a number of occasions for conduct related to breaches of the commuter use policy, including a final warning in February 1999 and a further final warning in December 2000;

· for a period of about two years prior to the termination, the appellant had been living with his father at a residence at Hampton Park;

· in 2001, his father bought another residence and decided to rent out the Hampton Park house;

· as a result, it was expected that the appellant would leave the house but no precise time-frame was set;

· the appellant's father, on Saturday 27 October 2001, for the first time gave him a deadline of that weekend to vacate the Hampton Park house;

· the appellant vacated the house on Sunday, 28 October 2001 after removing his personal motor vehicle and possessions to a house he owned at West Preston;

· the appellant then decided to move his Telstra vehicle from the vacated property to his new residence last thing on the evening of Sunday, 28 October 2001;

· he did not notify the respondent that he intended to do so in contravention of the respondent's commuter use vehicle policy but decided in lieu to make a report to his immediate team leader, Mr Winch, the next working day, being Monday, 29 October 2001;

· he made such a report to his team leader on that day;

· his team leader interviewed him and referred the matter to his Manager, Mr Trimarchi;

· on 5 November 2001, the appellant was suspended from duty pending an investigation and consideration by the respondent of the consequences of the breach;

· on 19 November 2001, Mr Trimarchi and Mr Winch visited the appellant at his home in West Preston and advised him his employment had been terminated for reasons previously raised with him and provided him with a letter to that effect.

[3] In his decision, the Commissioner, after setting out the facts and the parties' submissions, noted that, in considering whether a termination is harsh, unjust or unreasonable, the Commission is required to have regard to the factors set out in s.170CG(3) of the WR Act. In respect of these statutory considerations, he made the following findings -

· that there was a valid reason for the termination of the respondent's employment, i.e. the failure of the appellant to strictly adhere to the respondent's commuter use vehicle policy in the face of warnings when he knew and understood that policy;

· that the appellant was notified of the reason for the termination at the interview with his team leader and Service Manager on 5 November 2001;

· that the appellant was given an opportunity to respond to the reason for termination and that the reasons for his conduct were deemed unacceptable;

· that the appellant had been given two written warnings which were current; and

· that the size and structure of the respondent rendered the requirements of ss.170CG(3)(da) and (db) irrelevant.

[4] After expressing concerns about the action of the appellant's team leader in adding to a record of interview and the respondent's failure to interview the appellant's father, the Commissioner then went on to state -

[41 On all that was before me and having regard to a "fair go all round" on balance I am positively satisfied the termination of Mr Caspanello's employment with Telstra was not harsh, unjust or unreasonable.

[5] The appeal in this matter is against a decision dismissing an application brought pursuant to s.170CE(1)(a) of the WR Act. That sub-section provides, in so far as is relevant, that -

an employee whose employment has been terminated by the employer may apply to the Commission for relief in respect of the termination of that employment ... on the ground that the termination was harsh, unjust or unreasonable.

[6] The appeal, subject to the grant of leave, is brought pursuant to s.45 of the WR Act. By virtue of s.170JF(2), an appeal of this kind may be made "only on the grounds that the Commission was in error in deciding to make the order".

[7] The powers that may be exercised by a Full Bench on the hearing of an appeal are set out in s.45(7). Those powers are exercisable only if there is error on the part of the primary decision-maker.[2]

[8] The Commissioner's decision in this case may be appropriately described as a discretionary decision. The errors that might be made in exercising such a discretion were described in House v The King[3] in the following terms:

If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so.

[9] In the circumstances, it is both convenient and appropriate that we consider the question of leave in conjunction with the merits. We would, however, reiterate the proper approach to the granting of leave to appeal.

[10] Section 45(1) of the WR Act makes it clear that an appeal lies to a Full Bench only with leave of the Full Bench. Section 45(2) requires a Full Bench to grant leave if it forms the opinion that the matter is of such importance that, in the public interest, leave to appeal should be granted. If such an opinion is formed, the Full Bench is obliged to grant leave. However, that obligatory basis for granting leave is additional to and does not replace the conventional grounds for granting leave. Such conventional grounds include -

... whether, in all the circumstances, the decision is attended with sufficient doubt to warrant its being reconsidered by the Full Bench, or whether substantial injustice would result if leave were refused.[4]

[11] On behalf of the appellant, it was contended that there were two primary considerations which founded the respondent's decision to terminate the appellant's employment. The first of these, i.e. that the appellant had used the respondent's motor vehicle in an unauthorised manner, was not contested before the Commissioner or at the hearing on appeal. The second consideration was that the appellant's explanations for the use of the vehicle were not credible. The appellant argued that this second consideration was not made out by the respondent in the proceedings before the Commissioner and that the Commissioner had failed to take into account the respondent's erroneous conclusion in this respect.

[12] Where a termination of employment is for reasons related to conduct, the relevant test is not whether the employer believed, on reasonable grounds after sufficient enquiry, that the employee was guilty of the conduct that resulted in the termination. The Commission is required to determine for itself on the evidence before it whether or not the alleged conduct occurred.[5]

[13] As to the first allegation made against the appellant, the Commissioner was satisfied that the appellant had used the respondent's motor vehicle in an unauthorised manner, had been aware that such use was contrary to the respondent's commuter use vehicle policy and had received prior warnings for similar conduct. In our view, he was entitled to reach such a conclusion on the evidence before him. It was this conduct which, in the Commissioner's view, constituted a valid reason for the termination.

[14] As to the second allegation, it is apparent that the Commissioner accepted that the appellant had not known until Saturday, 27 October 2001 that he had to vacate the premises at Hampton Park by the following day. From a reading of his decision as a whole, it is equally apparent that the Commissioner had regard to this fact in conjunction with the appellant's explanation that he was acting to maintain the safety of the vehicle and its contents and so as not to disrupt the following Monday's work. His conclusion that such explanations did not override the necessity to abide by the policy was one that was open to him on the evidence.

[15] It was also submitted on behalf of the appellant that the Commissioner had failed to take into account the proportionality of termination to the gravity of the alleged conduct of the appellant.

[16] It may well be that, unless otherwise dealt with as being a relevant consideration under s.170CG(3)(e), the stage at which proportionality of penalty should be taken into account is at the stage of determining whether or not there was a valid reason for the termination. Support for that approach may be found in the following statement by Moore J in Edwards v Giudice and others[6] -

The reason would be valid because the conduct occurred and justified termination. The reason might not be valid because the conduct did not occur or it did occur but did not justify termination.

[17] It is well established that for a reason to be a valid reason for termination of employment it must be "sound, defensible or well founded".[7] If a punishment is inappropriate to the circumstances, there can hardly be a defensible reason for that punishment.[8] The reason for termination must be considered in the context of the penalty of termination and, for that reason, the termination needs, amongst other things, to be proportionate to the reason upon which reliance is placed. If the reason for the termination is particular conduct and that conduct does not justify termination, then the reason for the termination may not be valid. The issue of proportionality may arise under either paragraph (a) or paragraph (e) of s.170CG(3). In our view, whether or not, in a particular case, there is a valid reason for a termination of employment, the termination may still be found to be harsh on a number of bases including lack of proportionality.

[18] We do not agree that the Commissioner, in this case, did not have regard to the proportionality of termination to the gravity of the alleged conduct. He accepts that, if the appellant's conduct had been a single instance of an unauthorised use of a vehicle, it would not have constituted a valid reason for termination. He took into account the fact that there had been prior instances of the same conduct, two of which had given rise to final warnings. The Commissioner's approach does not disclose any appealable error.

[19] The third ground of appeal is that the Commissioner failed to take into account the length of the appellant's service in assessing the harshness of the termination. The Commissioner records in his decision the fact that the appellant was employed by the respondent for twelve years. We do not consider the fact that he makes no reference to that length of service in his conclusions demonstrates any error warranting correction on appeal. In this case, length of service could be a two edged sword. It could well be argued that, with such length of service, an employee should have a more responsible attitude to compliance with known policy.

[20] The next ground of appeal was that the Commissioner failed to take into account the appellant's submission at first instance that the respondent would have authorised the movement of the vehicle if permission had been sought by the appellant. Firstly, we do not accept that this submission was not taken into account by the Commissioner. Secondly, the evidence as to whether or not such permission would have been granted was disputed. Thirdly, whether or not such permission would have been given does not, in the circumstances of this case, carry much, if any, weight. The fact is that, despite the prior warnings in relation to similar conduct, permission was not sought at the proper time and the appellant acted without the requisite permission.

[21] The appellant then contended that the Commissioner had failed to make any finding as to whether or not the appellant had acted in accordance with the requirement of the respondent's policy that staff maintain the security of a motor vehicle and its contents. In our view, the Commissioner was entitled, in the circumstances of this matter, to give priority to the policy requirement regarding prior authorisation for private use of such a vehicle. Further, there is no basis for accepting that it was any more reasonable to move the vehicle to the new premises than to leave it at the Hampton Park premises.

[22] Other grounds of appeal included the alleged failure of the Commissioner to take into account the fact that the applicant did not attempt to conceal his conduct, the finding that the respondent did not have any option but to terminate the appellant's employment and the finding that a lack of trustworthiness regarding the commuter use vehicle policy did not justify employment in a capacity where such vehicle use was not available. We do not consider that any of these grounds establish any appealable error on the part of the Commissioner.

[23] It is often said that, in order to warrant a decision granting leave to appeal, more is usually required than simply establishing a case that might have persuaded the Full Bench to exercise the discretion in another way to that exercised at first instance. In the absence of a seriously arguable case of either legal error or miscarriage of discretion, the Commission would not grant leave to appeal merely to substitute its decision for the decision under appeal.

[24] In the circumstances of this case, we are not satisfied that the appellant has made out a seriously arguable case that the Commissioner erred in his decision or that the appeal raises public interest grounds warranting the grant of leave to appeal. Leave to appeal is therefore refused.

2 Coal and Allied Operations Pty Ltd v Australian Industrial Relations Commission [2000] HCA 47; (2000) 174 ALR 585, 74 ALJR 1348.

3 [1936] HCA 40; (1936) 55 CLR 499, at 505. This passage was cited with approval by the majority in Coal & Allied Pty Ltd v Australian Industrial Relations Commission [2000] HCA 47; (2000) 174 ALR 585, 74 ALJR 1348.

4 Construction, Forestry, Mining and Energy Union v Australian Industrial Relations Commission (1998) 84 IR 314, 333.

5 Australian Meat Holdings Pty Ltd v McLauchlan (1998) 84 IR 1; Edwards v Giudice and Others [1999] FCA 1836; (1999) 169 ALR 89; King v Freshmore (Vic) Pty Ltd Print S4213, 17 March 2000 (Ross VP, Williams SDP and Hingley C).

6 (1999) 169 ALR 88, at 92.

7 (1995) 62 IR 371, at 373 (Northrop J).

8 Ricegrowers Co-operative Limited v Schliebs Print PR 908351, 31 August 2001 (Duncan SDP, Cartwright SDP and Larkin C).

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