Schoeman v Director-General, Department of Attorney-General and Justice

The Commission's powers 84It is helpful to here set out the Commission's powers in a matter of this kind. 85This is, as noted above, an appeal brought pursuant to s.98 of the Act. I note that the appeal was lodged within the 28 days prescribed by subs.100B(2) of the Act. 86The Commission's statutory powers in relation to an appeal of this kind are set out at ss.100C and 100D of the Act, which fall within Division 3 of Part 7, Public Sector Promotion and Disciplinary Appeals, of Chapter 2 of the Act. 87These sections, indeed this Division, were inserted into the Act in 2010. 88.Section 100C provides as follows: 100C Decisions with respect to appeals (1) The Commission, in relation to a promotion appeal, may decide to allow or disallow the appeal. (2) The Commission, in relation to a disciplinary appeal, may decide to allow or disallow the appeal or make such other decision with respect to the appeal as it thinks fit. (3) Without limiting the generality of subsection (2), if in relation to a disciplinary appeal it appears to the Commission that the employer failed to comply with the rules of procedural fairness in making the decision appealed against, the Commission: (a) is not required to allow the appeal solely on that basis and may proceed to decide the appeal on its merits, or (b) may quash the decision and remit the matter back to the employer with such directions (if any) as to which stage of the disciplinary process in relation to the matter may be recommenced by the employer. (4) The decision of the Commission in respect of an appeal is, except as provided by section 197B, final and is to be given effect to by the employer against whose decision the appeal was brought. 89Section 100D provides: 100D Orders by Commission with respect to payment of salary and continuity of employment (1) Without limiting section 100C, if the Commission decides to allow a disciplinary appeal, the Commission may: (a) if the employee has paid a fine imposed by the employer or his or her pay has been forfeited-order the employer to repay the amount of any such fine or forfeited pay, and (b) order the employer to pay the employee an amount stated in the order that does not exceed the remuneration the employee would, but for the decision of the employer, have received from the employer, and (c) order that any period of employment of the employee with the employer is taken not to have been broken by the decision of the employer. (2) Any such order by the Commission must be given effect to by the employer. (3) Nothing in subsection (1) enables the Commission to make an order for compensation in the case where a person is not reinstated or does not continue in employment. 90It is immediately apparent from the words of subs.100C(2) that an appeal before the Commission is an appeal de novo. That is, the Commission is to hear and determine the matter afresh on the materials before it, not simply review the decision of the initial decisionmaker: see Calman v Commissioner of Police [1999] HCA 60; (1999) 167 ALR 91. 91The Commission may, in relation to a disciplinary appeal, allow or disallow the appeal or make such other decision with respect to the appeal as it thinks fit. The Commission is therefore not constrained merely to accept or reject the initial decision. It may impose any decision it thinks fit, including a harsher penalty than that which the initial decisionmaker imposed.

The applicable jurisprudence 92 Division 3 of Part 7 of Chapter 2 of the Act was inserted by Act 54 of 2010. It essentially transfers the jurisdiction formerly exercised by the Government and Related Employees' Appeal Tribunal ('GREAT') into the Act. Indeed, the Explanatory Memorandum to the Bill specifically identified ss.100C and 100D of the Act as being ' substantially the same as sections 48 and 48A, respectively, of the GREAT Act.' 93In the Second Reading Speech (Hansard, Legislative Council, 23 June 2010) it was made clear that the jurisprudence previously exercised by GREAT is not altered by the incorporation of those provisions into the Act. The Second Reading Speech contained the following explanation: The Government recognises that public sector promotional and disciplinary appeals are unique issues, quite distinct from general industrial disputes, and that resolution of these matters requires a tailored approach. For this reason, the bill will not affect the fundamental principles which underpin the existing public sector appeals framework. Nor will it alter the format and style of hearing practices that have been refined over time and which public sector employees, employers and their representatives are familiar with. The bill preserves current hearing processes for both informal and formal appeals under the Government and Related Appeals Tribunal Act and the Transport Appeals Boards Act, while granting the commission sufficient flexibility to make adjustments to suit prevailing operational and administrative requirements. 94It follows that the jurisprudence developed by GREAT pursuant to ss.48 and 48A of the GREAT Act is to be followed by the Commission in exercising its powers under ss.100C and 100D of the Act. 95Counsel for Ms Schoeman submitted that the disciplinary power exercised by the Director-General pursuant to the Regulations is 'protective, not punitive', no doubt invoking that phrase having regard to the way in which disciplinary powers exercised by, for example, the Commissioner for Police have been characterised: Commissioner for Police v Donlan (unreported, Supreme Court of NSW, 8 August 1995). 96That submission is not in my view correct in this case. 97The position with respect to employees employed in junior clerical positions by the Department is quite different to that of a police officer or indeed any public servant charged with holding a public office who may have obligations akin to fiduciary obligations. 98In respect of positions with fiduciary-like obligations and functions the applicable disciplinary system is, as was held in Donlan, protective. There is not, however, to be found within the Regulations - or indeed the Public Sector Employment and Management Act 2002 ('the PSEM Act') in its application to an employee such as Ms Schoeman - any basis for importing a protective jurisdiction of that kind, and a disciplinary sanction imposed on an employee such as Ms Schoeman is simply punitive in nature, not protective of the general public: Duhbihur v Transport Appeal Board [2005] NSWSC 811; 149 IR 276, at [106]-[107]. 99Of course, the Commission carries out all its functions in the light of a statutory obligation to have regard to the public interest: Act, s.146(2). The purpose of s.146, however, made evident by the specific references in subs.(2) to the Objects of the Act and the economy of the State, makes it clear that this obligation does not of itself alter the nature of the discipline imposed on an employee of this kind. 100The Commission's view of the matter is to be formed simply on the basis of, first, whether the misconduct said to be the basis for the punishment is made out; and second, if it is, whether the punishment imposed, here dismissal, is appropriate: Duhbihur loc cit.

Reasonableness 101The primary test in relation to punishment is whether the punishment is appropriate to such misconduct as is made out. That necessarily requires an assessment of its reasonableness, as it is an essential condition of every exercise of power by a statutory officeholder that the power be exercised reasonably: Minister for Immigration and Citizenship v Li [2013] HCA 18 at [23] ff per French CJ; Abebe v Commonwealth (1999) 197 CLR 510 at 554. 102Reasonableness in this context connotes proportionality. A disproportionate exercise of an administrative discretion, 'taking a sledgehammer to crack a nut' as French CJ characterised it in Li supra, will not be a reasonable use of an officeholder's power. 103An unreasonable decision in the context of the exercise of an officeholder's discretion will be without power, in that it goes beyond the framework of rationality or reasonableness provided by the relevant statute: Li supra at [26].

Onus of proof 104This is a case in which misconduct is alleged. 105As I note above, the first fundamental test in an appeal of this nature is to determine whether the misconduct which was cited as the basis for the punishment actually occurred. 106Misconduct is a serious matter, with potentially serious consequences. The obligation to make out that misconduct falls accordingly on the employer: Pastrycooks Employees, Biscuit Makers and Flour and Sugar Goods Workers' Union v Gartrell White (No 3) (1990) 35 IR 70 at 83-4; National Union of Workers NSW Branch (on behalf of Khan) v Cuno Pacific Pty Ltd (2005) 146 IR 441 at [35]. 107And where, as here, the dismissal is said to be for misconduct, the respondent must make out the misconduct on the balance of probabilities, but at a satisfactory level of proof: Briginshaw v Briginshaw (1938) 60 CLR 336; 'in a convincing way' as it has been expressed by the Full Commission: NSW Health Services Northern Sydney Local Health District v Hargreaves [2012] NSWIRComm 123 at [29]. 108An element of proving that misconduct has occurred where, as in this case, it is alleged that the misconduct was a failure to abide by a direction necessarily requires a consideration of whether the direction was lawful. That consideration necessarily includes, as I set out above, a consideration of whether it was reasonable. 109None of this of course detracts from the fact that a party seeking to persuade the Commission to allow an appeal against a disciplinary decision necessarily carries the onus of so persuading: Saini v Director-General, NSW Agriculture (Court of Appeal of NSW, 11 November 1996, unrep) per Cole JA, with whom Clarke JA and Maher JA agreed, at p 3.

The Regulations 110The Director-General purported to rely on certain regulations in giving the directions to Ms Schoeman which are at the centre of the allegation of misconduct. 111Considerable argument in the matter turned on the regulations and it is accordingly necessary here to set out the relevant regulatory provisions. 112Specifically, the Director-General invoked regulations which confer on the Department Head in certain circumstances a power to direct an employee to attend a medical assessment. 113Until 2009, the relevant Regulation was the Public Sector Employment and Management (General) Regulation 1996. ('the 1996 Regulation') 114That Regulation relevantly provides: 17 Health and safety (1) For the purposes of this clause, a member of staff is not fit for work if the health of the member of staff: (a) may render the member of staff a danger to other members of staff or to the public, or (b) is likely to be seriously affected by the staff member's remaining on duty or, if the member of staff is absent from duty, by the staff member's resuming duty. (2) The appropriate Department Head may direct a member of staff to submit to such medical examination or other health assessment as the Department Head may, on the advice of HealthQuest, consider necessary, if the Department Head has reason to believe that the member of staff is not fit for work. (3) If the appropriate Department Head has issued any such direction to a member of staff, the member of staff: (a) must, if on duty, cease duty immediately, and (b) must not resume duty until the completion of the medical examination or other health assessment concerned unless the concurrence of HealthQuest is first obtained or a certificate is furnished by a medical practitioner that the member of staff is fit for work. (4) If the appropriate Department Head receives a health assessment from HealthQuest that a member of staff: (a) is fit for work, the Department Head is to direct in writing that the member of staff, if absent from duty, must resume duty, or (b) is not fit for work, the Department Head is to direct in writing that the member of staff must cease duty immediately or, if absent from duty, must not resume duty. (5) If a direction has been given to a member of staff under subclause (4), the nature of the leave, if any, to be granted to the member of staff during the absence from duty is to be determined by the appropriate Department Head after consideration of any relevant advice of HealthQuest. (6) A member of staff to whom a direction has been given under subclause (4) (b) must not resume duty unless the appropriate Department Head, on the advice of HealthQuest, approves in writing. (7) The appropriate Department Head is to give the health care professional providing a health assessment of a member of staff under this clause any requested information about the duties of the staff member's position that is reasonably required for the purpose of providing the assessment. 115Although the Director-General invoked the 1996 Regulation in his letter of 23 January 2012, that Regulation had in fact been repealed rather more than two years earlier, on 1 September 2009, and replaced on that date with the Public Sector Employment and Management Regulation 2009. ('the 2009 Regulation') 116The 2009 Regulation reads as follows: 13 Health and safety (1) For the purposes of this clause, a member of staff is not fit for work if the health of the member of staff: (a) may render the member of staff a danger to other members of staff or to the public, or (b) is likely to be seriously affected by the staff member remaining on duty or, if the member of staff is absent from duty, by the staff member resuming duty. (2) If the appropriate Department Head has reason to believe that a member of staff is not fit for work, he or she may direct the member of staff to submit to such medical examination or other health assessment as the Department Head may, on the advice of a nominated medical assessor, consider necessary. (3) If the appropriate Department Head has issued a direction under subclause (2) to a member of staff, the member of staff: (a) must, if on duty, cease duty immediately, and (b) must not resume duty until the completion of the medical examination or other health assessment concerned unless the concurrence of a nominated medical assessor is first obtained or a certificate is furnished by a medical practitioner that the member of staff is fit for work. (4) If the appropriate Department Head receives a health assessment from a nominated medical assessor that a member of staff: (a) is fit for work, the Department Head is to direct in writing that the member of staff, if absent from duty, must resume duty, or (b) is not fit for work, the Department Head is to direct in writing that the member of staff must cease duty immediately or, if absent from duty, must not resume duty. (5) If a direction has been given to a member of staff under subclause (4), the nature of the leave, if any, to be granted to the member of staff during the absence from duty is to be determined by the appropriate Department Head after consideration of any relevant advice of the nominated medical assessor. (6) A member of staff to whom a direction has been given under subclause (4) (b) must not resume duty unless the appropriate Department Head, on the advice of a nominated medical assessor, approves in writing. (7) The appropriate Department Head is to give the health care professional providing a health assessment of a member of staff under this clause any requested information about the duties of the staff member's position that is reasonably required for the purpose of providing the assessment. (8) In this clause: nominated medical assessor means a person or body, or a person who is a member of a class of persons, nominated by the Public Service Commissioner for the purposes of this clause. 117A detailed comparison of the Regulations is not necessary at this point, but it is to be noted that under both Regulations the prerequisite for a direction to attend a medical assessment pursuant to the Regulation is that the Department Head, before so directing, must form a view that an employee is not fit for work, as that term is defined in the Regulation.

Approach to determining appeal 118Counsel for the Department summarised the Department's case in opening in this way: 119'This is a relatively simple matter. The respondent's case has always been that it had a valid reason to refer the appellant for a medical examination and that the appellant refused to attend the direction to attend the medical assessment, not just once but on three separate occasions. The appellant does not deny that she refused to attend the medical assessment. ... The respondent after attempting three times to have the appellant medically assessed without any success and any prospect of success the respondent instigated a disciplinary investigation as it was required to do as per s 46 of the Public Sector Employment and Management Act. 120For the Appellant's part, counsel for Ms Schoeman advanced that the case turned solely on, as he put it, a point of law. He submitted as follows: 121'Clause 13 sub (2) and its construction sits at the forefront of this case. The applicant's case will be that in each of the three directions the requirements in cl 13 sub (2) were not met; thus, the direction was not lawful and thus not a direction at all. In cl 13 sub (2), on its face it reads fairly plainly that the department head has reason to believe that a member of staff is not fit for work, that is - they are terribly important words - is not fit for work, he or she may direct the member of staff to submit to such medical examination or other health assessment as the department head makes on the advice of a nominated medical assessor consider necessary. What happened was the Director General directed the applicant to attend a psychiatric assessment in order to be able to assess which positions she would be suitable for. It was a suitability assessment which is not the same as a determination that one is not fit for work. They are different. With respect, what the Director General did by and large sits in conformity with common law, but in this case the common law cases on a direction to attend a medical assessment on reasonable grounds fall away, because there is a regulation. The regulation is different from the common law position.' 122The Appellant's proposition was developed, as it necessarily had to be given that submission, by asserting that the Regulation, whether the 1996 or the 2009 Regulation, was a comprehensive code dealing with the circumstances in which a Department head may direct an employee to attend a medical assessment: transcript, 8 August p 39. No authority was advanced for that proposition. 123.In my view the proposition that the Regulation (whether under the 1996 or 2009 Regulations) is a comprehensive code is not correct. The Regulation cannot be a comprehensive code on when the Department head may direct an employee to attend a medical assessment. Its own words, and specifically the precondition necessary to the Department head acting, that is, the formation of a view that an employee is not fit for work, limit the Regulation to being a comprehensive code on how a Department head may proceed if he forms the view that an employee is not fit for work. 124The fact that a Department head must proceed in accordance with the Regulation if he forms the view that an employee is not fit for work does not confine him or his officers in respect of circumstances where an employee is not believed to be unfit for work and the Regulation is not therefore activated at all. 125Nothing in the Regulations or the PSEM Act go to suggest that the regulation in question is intended to cover the field of the circumstances in which a direction to attend a medical assessment may be issued. Absent such a clear statement of statutory intent, the general powers of the Director-General - for example, pursuant to subs.14(2) of the PSEM Act, which provides that in the management of a Department, 'a Department head may take such action as the Department head considers appropriate in the circumstances but may not take action that is inconsistent with the functions specified in this Act or of the Minister administering the Act or of the Director of Public Employment' - should not be read down. 126A public servant in Ms Schoeman's position is an employee. The ordinary precepts of the common law regarding the contract of employment are not excluded as a matter of principle from the contract, but only if the express statutory provisions of an Act or regulations exclude them: Director-General of Education v Suttling (1987) 162 CLR 427 at 437-8 per Brennan J; Crown in Right of the State of New South Wales (Director-General, NSW Department of Health) in respect of Sydney West Area Health Service v New South Wales Nurses' Association [2011] NSWIRComm 111 at [177] - [185]; Public Service Association and Professional Officers' Association Amalgamated Union of New South Wales v Director of Public Employment [2011] NSWIRComm 152 at [83]. 127The common law permits an employer to direct an employee to attend a medical assessment, provided that such a direction is reasonable: Thompson v IGT (Australia) Pty Ltd [2008] FCA 994; 173 IR 395; R v Darling Island Stevedoring and Lighterage Co Ltd; ex parte Halliday (1938) 60 CLR 601 at 621-22. Indeed, in his opening submission set out above, counsel for Ms Schoeman expressly submitted that the Director-General acted in conformity with the common law in directing Ms Schoeman to a medical assessment, drawing attention to the requirement for reasonableness in such a direction. 128If the Regulation did not displace the common law, as in my view it demonstrated no intention to do and did not, then there can be little doubt that the Director-General had the power to direct an employee to attend a medical examination, provided that the direction is reasonable: Blackadder v Ramsey Butchering Services Pty Ltd (2005) 221 CLR 539. In part that power arises from the obligations an employer, here including the Crown, has pursuant to what is now the Work Health and Safety Act 2011: Thompson v IGT (Australia) Pty Ltd loc cit at 408-409.

Reliance on the Repealed Regulation 129Although a good deal of time was spent cross-examining the Respondent's witness to the effect that the repealed regulation had been wrongly called in aid in the Director-General's initial letters, as it obviously had, counsel for the appellant ultimately did not proceed to argue that simply citing the incorrect regulation in a letter invalidated the directions that were given, conceding, in general correctly in my view, that if a power existed in a statutory officeholder to take a particular action on the particular facts of a case, it matters not if he incorrectly regarded himself as acting under another power: transcript, 8 August, p 18 ll. 9-20. 130As the respondent's counsel submitted, 'The fact that the wrong regulation or a repealed regulation was cited within a letter does not of itself make the direction or the order unlawful. What it means is that there was a mistake made. If the authority or the power existed at the time that the direction was made it does not matter that it was wrongly cited or wrongly referred to in the correspondence.' (transcript, 8 August, p 7 l.23 ff) 131As a general principle, if the decisionmaker had at the time of making any decision a power on which he could properly have relied to make that decision, it does not invalidate the decision that the wrong statutory power was invoked: Trigger v Australian Telecommunications Commission [1984] 6 IR 446; Re PSA and POA and Macquarie Generation [2004] NSWIRComm 11; semble, Munnings v Smith (1987) 22 IR 254 at 264 per Northrop and Spender JJ. 132That might be different if the subject of the decision was placed at a disadvantage by the invocation of the wrong Regulation, in that for example he was left unaware of rights of appeal that would have been drawn to his attention if the correct Regulation had been invoked, but that is not the case here. 133As I say above, in general, in my view, there can be no real doubt that the Director-General and his appropriately-delegated staff had a power at large to direct Ms Schoeman to attend a medical examination. That says nothing about whether the power was reasonably, correctly or appropriately exercised, or if it was actually exercised at all, on the facts of this case, and nor does that of itself determine that misconduct occurred.

The circumstances of this case 134I now turn from the general to the particular circumstances of this matter. 135The elephant in the room in this case is that Ms Schoeman had been for some time a difficulty to the Department. That did not extend to her actual performance of her technical duties, which on the uncontested evidence was of a high standard and certainly did not form the basis of any allegation against her. 136However, on the unchallenged evidence she had made extreme, colourful and personally-directed allegations of corruption and misconduct at senior levels in the Department, and persisted in them even though a Departmental investigation found them to be unsubstantiated. She had then taken over a period of some years considerable periods of leave and was on restricted duties. If only for that latter reason, the view is inescapable - and it is confirmed by the contents, language and tone of the preliminary and final reports submitted to the Director-General set out above - that she was perceived as an employee about whose situation something had to be done.

Was it misconduct to refuse to obey the directions? 137There are two elements to this aspect of the matter. 138The first is whether valid instructions and directions were made at all. It can be misconduct to refuse a direction or instruction only if it was a valid direction or instruction. 139in my view the directions from the Director-General and the instructions from Ms Dunn were all invalid as they were beyond power. 140That is for the fundamental reason that they were unreasonable. 141As the High Court has held, it is an essential condition of every exercise of power by a statutory officeholder that the power be exercised reasonably: Minister for Immigration and Citizenship v Li loc cit at [23] ff; Abebe v Commonwealth loc cit at 554. 142An unreasonable decision by an officeholder in the exercise of a statutory discretionary power will be without power, in that it goes beyond the framework of rationality or reasonableness provided by the relevant statute: Li supra at [26]. 143The instructions by Ms Dunn and the purported directions from the Director-General were all, and were specifically expressed to be, for the purpose of obtaining a psychiatric assessment, as set out above. 144At the time of the instruction and directions purportedly given, Ms Schoeman was on restricted duties because of a wrist injury. The instruction and directions were for her to attend a psychiatrist. 145She was not on the evidence suffering a psychiatric condition. Dr Dowda and Ms Schoeman's treating doctor had said that she was not to work in the CPD because that would result in recurrence of her symptoms. Dr Dowda said that was because of 'unresolved human resources issues', not because of any persisting illness on Ms Schoeman's part. 146The Department had not in fact sought to place Ms Schoeman in the CPD since 2009 and indeed had expressly disavowed any intention of so doing, as the Director-General said in correspondence to Ms Schoeman during the course of the directions. There was no need to require a psychiatric assessment to 'assist with identifying suitable duties' as Ms Dunn's first letter put it. 147At the time of the directions and instructions to Ms Schoeman, there was simply no functional requirement to direct Ms Schoeman to a psychiatrist. 148The reference in later correspondence from the Department to the fact that Ms Schoeman had earlier seen a Dr Cameron, a psychologist, was patently called in aid as an afterthought. There was no active part of any treatment plan applying to Ms Schoeman at the time the directions were made that she visit a psychologist, let alone a psychiatrist, and, on the materials provided by her doctors to the Department, no evidence of any ongoing psychiatric illness. That HR Branch may have thought Ms Schoeman needed to see a psychiatrist because of the extreme and colourful nature of her allegations of corruption is not at all to the point. 149In those circumstances, any and every direction that she attend a psychiatric assessment in 2011 and 2012 was unreasonable and therefore without power. The instructions and directions were invalid at common law, let alone pursuant to any statutory powers. 150As the directions and instructions were without power, it follows that the finding of misconduct for failing to obey a lawful direction is necessarily wrong. Ms Schoeman did not refuse a lawful direction because the instructions and directions she was given, without anything else, were without power, and not lawful, because they were unreasonable. 151Fundamentally, the right to impose a punishment following a charge of misconduct is dependent on a finding that an employee committed the specific act of misconduct with which they are charged, not merely upon a finding of fact that the employee is guilty of any act of misconduct: Re Public Service Association and Professional Officers' Association Amalgamated Union of NSW and Macquarie Generation [2004] NSWIRComm 11 at [73] - [74]; Public Service Association of NSW and Public Service Board Re Ristau (No 2) (1979) AR 357 at 373. 152Here the specific misconduct with which Ms Schoeman was charged cannot be sustained. Neither the employer nor the Commission can recast the charge or view her conduct other than against the charges of misconduct as they were specifically framed and put to her. 153 The onus of proving the misconduct falls on the Department. It is an onus the Department does not satisfy. 154The fact that there was no misconduct meant that there was no basis for any disciplinary sanction to be imposed: PSEM Act s.46(2).

Further reason that finding of misconduct fails 155Even were I wrong in finding that the instructions and directions were invalid for being unreasonable, Ms Schoeman has not committed misconduct in relation to, at least, the Director-General's directions for another reason. 156Addressing the Director-General's letters to Ms Schoeman, it is evident that here the decisionmaker expressly and specifically relied on a particular statutory power, the regulation, to give a direction. He expressly set out the factual purpose for which he sought to invoke that power; a suitability assessment. That was a purpose for which the statutory power he invoked was not and could not have been used. 157That is, the Director-General purported to direct Ms Schoeman to a medical assessment under a Regulation which required as a precondition that he form a view that she was unfit to work. He did not form that view, and could not have formed that view on the facts. Indeed, he did not assert that he had formed that view, instead asserting to Ms Schoeman in writing that the basis for his direction was something altogether different, a requirement to assess Ms Schoeman's suitability for other placements. 158As the Director-General had not formed a view that Ms Schoeman was unfit, he had no power to direct her to attend a medical assessment under the Regulation, as the necessary precondition to the exercise of the power granted by the Regulation had not been met: Director-General, Department of Education ad Training v Sud [2010] NSWIRComm 147 at 33. 159It was evident on the face of the letters containing the directions, citing as they did the specific regulatory basis called in aid for the directions to an assessment, together with a statement of the purpose for which the assessment was to be used, that the directions were an invalid use of the statutory power actually invoked, that is, the Regulation 160Indeed, Ms Schoeman in each of her responses to these directions pointed out that they were without legal foundation. That did not lead the Director-General to consider any other powers he may have had in the circumstances; he persisted in directing Ms Schoeman under the Regulation. 161On one view the directions were simply invalid for the reason, further to their unreasonableness, that they were expressly framed as being under a regulatory power and the precondition for their issue under that power was on the evidence not met. 162But even without that, and even if it is said that the Director-General had a power to direct Ms Schoeman to a medical assessment, in my view Ms Schoeman was entitled to resist the Director-General's directions, as they were on the face of the letters received by her invalid directions, made without power, for reason that the factual circumstances simply did not provide the necessary precondition to the direction in the terms that it was made and indeed reinforced to Ms Schoeman. As I note above, Ms Schoeman expressly resisted the directions on the basis that they were without legal foundation. On the face of the letters she was given, she was right to say so. 163That is because Ms Schoeman, as any employee, was entitled to assume that the Director-General was acting, on the advice of his senior and experienced staff, in full competence and in full knowledge of his powers. 164Faced with directions on their face invalid, in that they expressly invoked a regulation (whether the 1996 or 2009 Regulation) that on the facts did not permit the Director-General to give the direction he purported to give, as he had not formed the necessary prerequisite view that she was not fit for work, it is not for Ms Schoeman (or any employee) to assume that the Director-General has erred in his written direction, further assume that as a matter of law he could have given the direction validly under another power to which he has not referred, then assume to herself an obligation to act as if the direction had been given under that other, unexpressed and unidentified, power, and then to act accordingly by attending the assessment. 165The Director-General's directions were, given the facts of the matter, on their face bad. To refuse the Director-General's directions in the terms that they were made was simply not misconduct. 166This is not made any different by the proposition of law set out above, that an officeholder identifying the wrong power for an action will not of itself invalidate the direction when in fact he had another power that permitted a valid direction. That may be the law but, as I say above, it is not for Ms Schoeman to know that and assume an obligation to act on it when she is not told it by the Director-General. 167As noted above, the Director-General invoked in two letters the Department of Premier and Cabinet Circular C2011-23 at Section 5.1. That does not improve the Department's position. The Circular does provide that employees are required to comply with an agency's direction to attend and participate in a medical assessment. It does not provide a power to direct independent of the powers actually held by the Director-General or his delegates, and it does not confer reasonableness on an otherwise unreasonable exercise of the power. 168It again follows that there was simply no misconduct in refusing to attend a medical assessment as the Director-General purportedly directed. Again, it follows that there was no basis for any disciplinary sanction to be imposed: PSEM Act s.46(2). 169As to the Dunn instruction, if I were wrong about it being invalid for unreasonableness, it is, it is true, not invalidated by a reliance on a regulatory power that could not be invoked. 170It is nevertheless of itself not a basis for the imposition of any disciplinary sanction approaching dismissal, which was the punishment imposed. If I were held to be wrong on the bases set out above and also below, concerning procedural fairness, the refusal of the Dunn instruction itself warranted, in the context of the Department's dealings with Ms Schoeman, and given her unblemished records, no more than a reprimand. However, for the reasons I set out above and below, such a punishment is not warranted.

Further reason that the punishment is improperly imposed 171For the reasons I set out above, the punishment imposed on Ms Schoeman was not properly imposed, as the fact that there was no misconduct meant that there was no basis for any disciplinary sanction to be imposed. 172There is however another aspect of this matter that provides another reason why the appeal should be upheld and the punishment should not be allowed to stand. 173It is apparent from the evidentiary material set out above that the reports, both preliminary and final, provided to the Director-General and endorsed by him contained language that had no place in any reasoned, balanced and objective exercise of statutory officeholder powers. On their faces the two reports that gave rise to the decision to dismiss use language divorced from the sort of language than a disinterested party would advance, and use language which is openly coloured against and prejudicial toward Ms Schoeman. That was itself a real procedural unfairness to Ms Schoeman. 174It constituted an unfairness in the preliminary report, as the use of such language stood against the obligation to keep an open mind and be ready and willing to be persuaded by Ms Schoeman until she had been heard: Hall v NSW Trotting Club [1977] 1 NSWLR 378 at 388. It constituted unfairness in the final report because the use of such language by a decisionmaker does not permit the conclusion that the decisionmaker has acted objectively. 175Secondly, and more importantly, even aside from the language used, there was concretely a good deal of prejudicial material, some of it as I note above unsourced hearsay, advanced to the Director-General and taken into account by him, that was wholly outside the actual allegations of misconduct that were purportedly the subject of the decision, and therefore irrelevant. 176As I note, there was no allegation against Ms Schoeman that she had breached minimum ethical standards, or failed to comprehend basic principles of respect and courtesy, or demonstrated a continued pattern of disrespect of law and authority, or demonstrated a lack of respect for the authority and legislative processes, or engaged in inappropriate, unprofessional and unacceptable behaviour. Nor did the allegations of misconduct include an allegation that in relation to her workers' compensation claim she was 'often unco-operative, evasive in providing requested documentation and on occasions, rude and discourteous to staff'. 177Yet this irrelevant and prejudicial material was expressly taken into account, on the Department's evidence, in the findings on the specific allegations of misconduct that were made and the decision to impose dismissal as a punishment. 178That constituted a significant procedural unfairness toward Ms Schoeman. 179Discretely, the reliance on irrelevant material rendered the whole of the decision to impose a punishment ultra vires. 180Further, the process adopted by the Department was significantly procedurally unfair for yet another reason; that the Director-General expressly used Ms Schoeman's written submissions on penalty dated 17 December 2012, which were submitted after the allegations and the initial findings of misconduct, as a further material basis for a final finding of misconduct and a decision to dismiss, without giving her any opportunity to be aware that he was doing so, let alone an opportunity to be heard about that. This was egregiously unfair. 181Pursuant to s.100C of the Act, of course, the Commission is not required to allow an appeal solely on the basis that the employer failed to comply with the rules of procedural fairness. The Act nevertheless permits the Commission to uphold an appeal solely on that basis. 182If I were wrong on the substantive matters set out above, that is, that the directions and instructions were invalid, and, discretely, that even if they were not, there was no misconduct, the appeal would nevertheless be properly upheld solely on the basis of this tripartite procedural unfairness to which Ms Schoeman was exposed. 183It would also, quite discretely, properly be upheld on yet another basis, that being that the decision imposing the punishment of dismissal was ultra vires for reason of the Director-General taking into account irrelevant prejudicial material, material which it was the Department's express evidence that he did take into account in making the final decision. 184As I have found that there was no misconduct, there is no reason to remit the matter to the Department to decide afresh under the Commission's powers pursuant to s.100C(3) of the Act. 185Were I thought to be wrong on all but the procedural fairness issues, however, for reason that the reports advanced to the Director-General by senior Departmental officers display language inconsistent, as I say, with any objective assessment of the matter and indeed displaying some animus toward Ms Schoeman, to exercise the Commission's powers to return the matter to the Department to decide again would in my view be nugatory. 186As I have found that there was no valid direction in the first place, and therefore no misconduct in refusing to obey it, there was no basis for the imposition of any punishment. No punishment is warranted where no misconduct lay, and accordingly the proper outcome is that the appeal be upheld and the punishment of dismissal be set aside. Orders to that effect will follow, together with orders going to monies payable under subs.100D(1).

Question of practicability of reinstatement 187There is, however, yet one further issue. 188I have referred above to the allegations Ms Schoeman has voiced against the last Director-General, the present incumbent and senior Departmental officers. The tone of those allegations and comments are evident in her last letter to the Director-General which I have in part set out above. 189It was put by counsel for the respondent that the repeated and extreme allegations and declarations of a complete and utter lack of trust by Ms Schoeman in Departmental officers, not to mention to use of terms such as devious, dishonest and corrupt, meant that whatever might come of this appeal, the employment relationship could not be restored. It was pointed out, correctly, that Ms Schoeman had been equally unstinting in her personal criticisms of the present Director-General. 190This was raised at the end of proceedings and I gave both counsel the opportunity to make further written submissions on the point; both did so. 191The argument advanced by the respondent was essentially this; after setting out the well-known tests in Blyth Chemicals v Bushnell (1933) 49 CLR 66 at 81-82, it was submitted that the refusal of the directions by Ms Schoeman was so destructive of the relationship between employer and employee that it is 'fundamentally impracticable to reinstate the Appellant to her employment.' That submission falls away once it is apparent that there was no refusal of a lawful direction, and that Ms Schoeman was entitled to resist what were unreasonable directions. 192The second limb of the respondent's argument, however, was that the 'highly critical and disparaging' statements made by Ms Schoeman 'display a profound and utter lack of respect for the Director-General' and that her 'ongoing lack of trust in key personnel within the employing department' make reinstatement impracticable. 193There is no doubt that the characterisation of Ms Schoeman's statements as 'highly critical and disparaging' is accurate, indeed restrained. 194The position, however, is this. 195The task before the Commission is to determine, first, whether the misconduct alleged in fact occurred, and second, whether a punishment is appropriate or justified,. 196I have found that there was no misconduct. There is no basis for the imposition of any punishment. The Commission simply has no power to impose any sort of punishment - which would be the effect of failing to set aside the decision to dismiss - in circumstances where there was no misconduct. It follows that the question of the restoration of the employer-employee relationship is simply not a matter that the Commission has to, or can, address in this matter. 197Even if I were wrong about that, the Commission's jurisdiction under s.100 must be contrasted with that under s.89 in relation to an application made under s.84 of the Act. Under s.89, the Commission is given a statutory obligation to consider practicability. That is not the case here. The parliament has chosen not to make such a weighing exercise part of the statutory regime applying to appeals. The issue does not arise in this case, as there was no misconduct, but even if there were, the question is simply whether the punishment imposed is appropriate. A consideration of, as advanced by the respondent, whether 'reinstatement is practicable', does not arise.

Orders 198The Orders that I make in this matter are as follows.

1. The appeal is allowed.
2. The decision of the Director-General to dismiss Ms Schoeman dated 10 January 2013 is set aside.
3. The respondent is directed to pay to Ms Schoeman an amount of remuneration equivalent to the amount which she would have received, but for the decision of the Director-General to dismiss her, between 10 January 2013 and the date of this decision.
4. Ms Schoeman's continuity of employment with the respondent is taken to be unbroken. PETER NEWALL Commissioner DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated. Decision last updated: 30 September 2013