Facts
21 Ms Thompson commenced working as a bar attendant at the Charles Hotel on 27 February 1999. Apart from a break for 2½ months in 1999 for the birth of her second child, until some time in 2004 Ms Thompson appears to have worked three regular day shifts during the week. In 2004 one of these day shifts was replaced by a night shift. She did not work any regular hours on weekends. Substantial changes were made from the week commencing 17 October 2005 but before discussing them it is necessary to provide a summary of some earlier events.
22 In January 2005 Mr Doug Allan became the licensee of the hotel. He remained in that position until 13 October 2005 when Ms Marja Engelhardt took over from him.
23 Mr Wakeford was concerned about a number of aspects of the hotel's operations. On 10 August 2005 he sent a memo to Mr Allan. Excluding introductory and concluding remarks he expressed his concerns as follows:
'My observations of the operation of the hotel and the areas which I feel need attention are listed below.
1 Mode of operation
The hotel has had a real change in the way it has been operated for many years. Successive managers have become seat warmers and have only carried on with events as they have been passed on by their predecessors in the past. We need a fresh approach to the hotel operation.
2 Staffing
Whilst most of the staff are acceptable, there a few who really must go. They are tired in appearance and attitudes and have a negative effect on the rest of the staff and also on our few remaining customers.
New professional staff are urgently required, particularly in the gaming area. Considering I am the one paying the wages I would like some input into employing new staff.
3 Wages level
The wage level at this hotel is excessive and has now reached a point where the wages level exceeds the bar income, which of course is unacceptable. With the introduction of the single bar operation to facilitate the eventual non smoking venue NOW is the time to reform our staffing and to introduce some new blood and ideas into the workforce.
Events over the last few weekends with the bottleshop computer demonstrate that our assistant managers have very little to do bar playing online with our bottleshop computer then leaving it in an inoperable condition.
Once the single bar operation is introduced we will use the assistant managers to serve behind the bar in busy periods.
4 Cleanliness of the hotel
Whilst the hotel is cleaner now than in the past, there is still room for a large improvement and I see a reduction in cleaning hours as a priority.
From my observations over the last month Gary and Trish are enjoying a paid holiday at the hotel.
5 Promotions
Australia day, Saint Patricks day, Valentines day and many other opportunities have passed with no relevant promotions occurring at the hotel.
The gaming promotion which Karen carried out on Thursday evenings was popular, but like most promotions it became tired.
Anzac day was a success because we promoted it.
We need to plan ahead to capatilise [sic] on events as they occur and to promote these events as necessary.
As shown by recent trading figures, Friday night Karoake and noisy bands are a complete waste of money.
6 Bar Percentages
As you heard at the AHA conference the ATO expect our bar trading percentages to be 70% unless we can explain any shortfalls, which I am unable to do.
We are trading around 56% to 58% which is unacceptable.
We need to examine the following and to act on any findings.
Cellar procedures
Bar procedures
Free drinks
Staff drinks
7 Gaming
The gaming receipts have dropped markedly this year as shown on the graph. The operation of the gaming room needs to be reviewed, with vigour.
Free coffee and sandwiches need to be served at the poker machine area to players in a polite manner.
Noise in the gaming room to be soft music, not the crappy staff now being played at a high noise level. A better understanding of gaming must be introduced to all staff.
Moving the TAB will assist.
8 Food
Decent food is a priority.
We must reopen the food area in a professional manner and not use untrained people as cooks.
Meanwhile we should consider bar snacks as a priority.
9 Any other.'
(Bold type in original)
24 Mr Wakeford's opening remarks reminded Mr Allan that the period since January 2005 was the period of greatest decline in the income of the hotel. Other evidence indicated that in the same period the hotel was moving to a single bar operation. This was clearly a period of change which was taking place in a commercially adverse context.
25 On Wednesday, 5 October 2005 Mr Allan gave notice of his resignation following a period of leave which was to commence the following Monday (10 October). Mr Wakeford appointed Ms Engelhardt, then Manager of the bottleshop, to be interim manager of the hotel effective from Thursday, 13 October 2005. Ms Engelhardt had worked for Mr Wakeford for a number of years in various businesses. It appears that, originally, Mr Wakeford intended to find someone else to permanently replace Mr Allan but as events unfolded Ms Engelhardt remained manager and took up the position permanently from 4 November 2005.
26 The relationship between Ms Thompson and Ms Engelhardt (as Manager) appeared to get off to a rocky start. In the week following her appointment as interim Manager Ms Engelhardt authorised changes to the staff rosters. Starting times in the morning were delayed by half-an-hour and two afternoon shifts were cut from the roster altogether - one on Thursday and one on Friday. For the previous twelve months or so Ms Thompson had been working on day shift on Tuesday and Wednesday and on evening shift on Thursday commencing at 5pm. In the week commencing 17 October 2005 she lost her evening shift on Thursday. Ms Thompson bore a relatively large proportion of the cut in working hours, although certainly not the whole of them.
27 On Tuesday, 18 October Ms Thompson recorded in one of the diaries used to communicate between staff (including managers) that she had spoken to Ms Engelhardt about her shift arrangements and been told that she had lost some work because of her attitude. Ms Thompson's note referred to events which occurred on 11 October, two days before Ms Engelhardt's appointment as interim manager. It is likely that they involved some complaint from Ms Thompson about working under the supervision or direction of staff who were younger than she. One of the staff whose authority Ms Thompson appeared to resist and resent was Ms Melissa White. Ms White was 21 years old and had been appointed assistant manager by Mr Allan. At Ms Engelhardt's request she recorded a formal complaint to which she assigned the date 15 October 2005. She said in her evidence that the date was probably not accurate although the events had occurred at around that time. That complaint was as follows:
'Dear Maya [sic],
I wish to make a complaint against Donna Thompson, on several different occasions for the past several weeks I've had a few run ins and been verbally abused by Donna. It started when I started to do some training as assistant manager. Donna told me that she refused to work under or listen to a 21 year old lazy bitch who is to young to be a manager and doesn't no [sic] how to do her job properly. She has mad me feel intimidated and uncomfortable during my shifts with her.
She has bitched to other staff members about my age and capability to work for the pub. This is not on and I don't think I should have put up with it, I have spoke to both you and Tim on several occasions about this matter and written it up in the book, please when you get some time I would like to speak to you further about this matter.
Yours faithfully,
Melissa White'
28 Ms Engelhardt's evidence about the events shortly before her appointment as interim manager was that she was in the main bar and about to go to the bottleshop when Ms Thompson:
'… comes storming in, I'm not working with no effing 21-year-olds and I'm not working with effing Gavin and I'm not working with effing Mel. They're incompetent. They're - she just kept going on about the age and as a supervisor, "I'm not working with no fucking 21-year-old supervisor" and I just said look, settle down, come and see Doug when he's back next week and I did sort of pass a bit of a joke that Gavin is going to be the licensee and she went off.'
29 Gavin and Mel are Mr Visser and Ms White. Mr Visser was also an assistant manager and had been put in charge of the hotel upon Mr Allan going on holidays the day before. He was also much younger than Ms Thompson.
30 It is apparent that Ms Thompson spoke to Ms Engelhardt on 18 October about the loss of her evening shift on 20 October and did so in a way Ms Engelhardt found confronting. Ms Engelhardt's evidence included the following:
'Now, I think you have given his Honour some understanding that you had some contact with Ms Thompson prior to being appointed interim licensee and then licensee?‑‑‑Yes.
Could you describe your contact with Ms Thompson upon becoming licensee?
‑‑‑Upon - very difficult. I just felt like she was out to give me a hard time for some reason. I didn't really know why.
HIS HONOUR: Just give me some idea of the time frame, Ms Engelhardt. Was this before or after the roster changes?‑‑‑No, after. From the moment she came in that first shift with Gavin and saying about Gavin and Mel, I am not working with effing 21-year-olds it became, yes, and then when I changed the rosters and changed the hours she would come in behind the bar and come like two inches from my face and like really, I want my shifts back, I want my shifts back and really, yes, pretty stressful and I would say to her, look, come and talk to me in the office but she would never talk to me in the office about it. She would always confront me in front of patrons and always, like, talking loudly behind the bar and always just coming straight up to my face and, yes, so I would just sort of back away and just say come and see me in the office.
MR CROSS: And how quickly upon your being appointed interim licensee do you say this behaviour commenced?‑‑‑Pretty well straight away.'
31 In the week commencing 24 October 2005 Ms Thompson was rostered to work day shift on Wednesday and half a shift on Saturday evening. In the week commencing 31 October 2005 she was rostered to work evening shift on Monday and day shift on Wednesday. They were also her rostered hours in the week of 7 November 2005. Wednesday of that week was 9 November. Ms Thompson's evidence was that she did not receive another day shift after 9 November. It seems clear that by 9 November Ms Thompson's work relationship with Ms Engelhardt had deteriorated to a marked degree. Ms Engelhardt told her, she said in evidence, that she would not get another day shift as Ms Engelhardt could not work with her.
32 Ms Engelhardt attributed the roster changes that affected Ms Thompson directly to the conflict which was developing between them. She said:
'You have given evidence earlier when we have looked at the differences between the roster for the week commencing 10 October and the roster commencing 17 October as to certain changes that were made that affected the person's rosters?‑‑‑That is correct.
Was there anything peculiar to Ms Thompson after 17 October 2005 that affected the amount of rostered work she received or the time of those rosters?‑‑‑Yes, because she would just make my day so difficult that I ended up putting her on afternoon shifts so that hopefully we could get along if she wasn't on day shift. Then that sort of wasn't really happening so I put her on weekends, hoping we could avoid each other. It just didn't feel like she wanted to be involved in the up and running and getting the hotel back on its feet. It was anything to make my life really hard and I struggled with that kind of behaviour, I didn't know how to deal with it.
Around what time did that conduct affect the rosters received by Ms Thompson?‑‑‑Probably mid November if not a bit earlier because it was just continual.'
(emphasis added)
33 Asked why Ms Thompson's employment had not simply been terminated Ms Engelhardt answered that she had never dealt with problems of this kind and thought Ms Thompson would 'just get over it eventually'. As I understood her evidence Ms Engelhardt did not know what else to do except to ensure that Ms Thompson worked on shifts which were different from Ms Engelhardt's own working times so that the opportunity for confrontation and, as Ms Engelhardt saw it, further harassment by Ms Thompson was removed.
34 On 14 November 2005 Ms Thompson had a meeting at the hotel with Mr Wakeford. Ms Engelhardt and Mr Dale (the accountant) were also present. The meeting on 14 November was arranged when Ms Thompson rang Mr Wakeford on 9 November after speaking to Ms Engelhardt about her rosters.
35 At this meeting Ms Thompson was issued with a warning letter referring to three incidents which had occurred on 9 November. Ms Thompson disputed the substance of each of them in her evidence but in my view that cannot detract from the indication that she was not on good terms with Ms Engelhardt. The three incidents were identified as follows:
'• Failed to ensure TAB race sheets were up
• Failed to ensure there was adequate change for the Lunch break relief
• Displaying a poor attitude / resentment to new Management'
36 There is no indication in the evidence that this warning letter was ever acted upon or had any further formal significance. However the third entry is consistent with other evidence to the effect that Ms Thompson and Ms Engelhardt did not enjoy each other's company at work.
37 Ms Visser's evidence confirmed this general picture. During his cross-examination the following evidence was given:
'HIS HONOUR: Well, Mr Visser, tell me why it was Ms Thompson who lost most of the hours?‑‑‑At this point in time in, like, late November/December, that is when - I don't know how to put it politely but, like, bitchiness, fighting between Mia [Marja] and Donna, saying, I want my effing shifts back, and this is a point in time where it made it impossible for Donna to work in the mornings with Mia [Marja]. It made it too hard to - both people do their jobs. This is when we had customers coming up to us and saying - like, Donna was involving customers in workplace stuff and never need to be done. So it made it really impossible to get on the right shifts so everybody could do their jobs properly.
"Getting on the right shifts" meant, in a practical sense, keeping Ms Engelhardt and Ms Thompson separated?‑‑‑Yes. Because we've had - we had one row. I was coming out of the bottle shop because I wasn't in the pub that day. Donna was working and Mia was finishing. They had a conflict behind the bar. Donna stating that, I want my shifts back, and swearing, pointing, and then they went to the office to sort it out. So I don't know - don't know what happened then.'
38 Ms Thompson began to seek work elsewhere. For a short period, commencing about 11 November 2005, Ms Thompson worked, apparently on a trial basis, at the Albion Park Hotel. Then, about 18 November 2005, she began working at the Collegians Club in Wollongong. It appears that she did not continue to work at the Albion Park Hotel after securing comparatively regular casual employment at the Collegians Club. Her obligation to attend a training shift at the Collegians Club on 22 November 2005 saw her prefer that to working at the Charles Hotel. From about this time, therefore, (i.e. mid November 2005) Ms Thompson made up for the shifts she had lost at the Charles Hotel by working elsewhere. Nevertheless, on 28 November 2005 she again took the matter up with Ms Engelhardt. She raised the matter at the main bar in front of customers. Ms Engelhardt caused the conversation to be moved to her office. Ms Thompson persisted in her complaints. Ms Engelhardt sent her home. Ms Engelhardt's evidence was:
'Then I just said to Donna, come and see me in the office and then when she came in to see me in the office she was like really, I want my shifts back, I want my shifts back and I'm going Donna, I'm tired of the attitude. I'm tired of this behaviour all the time. I'm tired of being attacked in front of customers and all I can recall is Donna kept saying I want my shifts back and I just said look, you know, I could have you sacked for insubordination. I was getting pretty frustrated by this time because I couldn't - you couldn't communicate with her well and I said look, just go home and come back next week for your next shift and we'll settle down and ‑ ‑ ‑
…
HIS HONOUR: Was this before the end of her shift?‑‑‑No. The beginning of her shift.
What happened to her pay for the shift?‑‑‑I paid for the shift.'
The general substance of this conversation was confirmed by another employee who was asked by Ms Thompson to be present as her witness.
39 During December Ms Thompson's rostered shifts at the Charles Hotel became even more sporadic and reduced for three weeks to one shift per week. On 10 December 2005 Ms Thompson wrote saying she would be unavailable to work on Christmas Eve and New Year's Eve. She attributed her unavailability to difficulties of finding suitable and appropriate child care. It became clear that she had in mind also that she might be asked to work at Collegians Club. During this period there were some other occasions when she was rostered to work at the Charles Hotel but did not do so. In the week commencing 2 January 2006 Ms Thompson was not rostered to work at the Charles Hotel. In that week she worked at Collegians Club on four days. She accepted in her evidence that those working arrangements would have been rostered at Collegians Club the week before. Nevertheless Ms Thompson deposed that on 2 January she had a conversation with Ms Engelhardt complaining that she had been left off the roster at the Charles Hotel. Two days later Ms Thompson rang Mr Wakeford directly. It is this conversation which is relied upon by her as suggesting that her ongoing employment with the Charles Hotel was terminated.
40 In her letter of 10 December 2005 Ms Thompson also indicated that she wanted to take 'four weeks vacation' between 6 January 2006 and 6 February 2006. During this period, although she did not perform any work at the Charles Hotel, she worked at the Collegians Club. On 23 January 2006 Ms Thompson filed an application in the Australian Industrial Relations Commission alleging that she had been unfairly dismissed. She did not return to work at the Charles Hotel.