West v Director-General NSW Ministry of Health in respect of Western Sydney Local Health District

Legislative Framework & Principles governing late applications 26The Industrial Relations Act 1996 relevantly provides: PART 6 - UNFAIR DISMISSALS SECTION 85 TIME FOR MAKING APPLICATIONS 85(1) [No later than 21 days after dismissal] An application under this Part must be made not later than 21 days after the dismissal of the employee. 85(2) .... 85(3) [Commission may accept application lodged out of time] The Commission may accept an application that is made out of time if the Commission considers there is a sufficient reason to do so, having regard in particular to: (a)the reason for, and the length of, the delay in making the application, and (b)any hardship that may be caused to the applicant or the employer if the application is or is not rejected, and (c)the conduct of the employer relating to the dismissal. SECTION 90 EFFECT OF AVAILABILITY OF OTHER REMEDIES 90 The Commission must not determine an applicant's claim by making an order under section 89 if: (a) another Act or a statutory instrument provides for redress to the person in relation to the dismissal, and (b) the person has commenced proceedings under the other Act or instrument or has not lodged a written undertaking not to proceed under the other Act or instrument. PART 7 - PUBLIC SECTOR DISCIPLINARY APPEALS SECTION 99 ALTERNATIVE RIGHTS OF APPEAL 99 (1) Nothing in section 98 derogates from or otherwise affects any right of appeal a public sector employee may have, or other proceedings which may be instituted by the employee or on his or her behalf, under this or any other Act or law or any industrial award or agreement (whether enacted, existing or made before, on or after 1 July 2010) in respect of an appealable decision. 99(2) A public sector employee may not appeal to the Commission under section 98 in respect of an appealable decision if: (a) the employee has elected, in writing, to forgo a right of appeal under section 98 in respect of the decision, or (b) the employee makes an appeal or institutes other proceedings, or proceedings are instituted on the employee's behalf, in respect of an appealable decision under an Act or law or an industrial award or agreement referred to in subsection (1). 99(3) If an employee appeals to the Commission under section 98 in respect of an appealable decision, the employee may not then, in respect of that decision, appeal or institute other proceedings or proceedings may not be instituted on his or her behalf under an Act or law or an industrial award or agreement referred to in subsection (1).

The Issues 27There are two issues that arise for consideration by the Commission

1. Was the application out of time?
2. If so, then is the Commission prepared to exercise its discretion to accept the out of time application?

Was the application out of time? 28The Applicant contended that the Respondent was obliged, in accordance with the requirements of the NSW Health Policy PD2005_225 (Disciplinary Process in NSW Health - A Framework for Managing), to advise him of the appeal mechanisms available to him and that advice was not included by the Chief Executive, Mr Danny O'Connor, in the letter of termination dated 12 February 2013. The Applicant's Solicitor, Petrine Costigan or Petrine Costigan Lawyers, wrote to Mr O'Connor on 14 February 2013 advising that her client wished to appeal the decision to terminate him and sought, in accordance with the said policy, written advice of the appeal mechanisms available to him. In correspondence dated 18 February 2013, Mr O'Connor responded that there were no internal appeal mechanisms, however, as had been identified by the Applicant's lawyers, there were appeal mechanisms to an appropriate jurisdiction available to the Applicant. 29Mr Gardner forwarded an email letter to the Applicant's Solicitor on 17 June 2013 in which he addressed, amongst other things, the competency of the proceedings brought on behalf of the Applicant. He wrote in part: On our instructions, the Applicant was at no relevant time an employee entitled to appeal to the Government and Related Employees Appeal Tribunal Act 1980 (GREAT Act) immediately before its repeal on 1 July 2010. We also understand that at all material times, your client's employment was covered by the Health Managers (State Award (Award). Clause 5 of the Award expressly incorporates the terms of a memorandum of understanding which at all material times removed covered of the GREAT Act and Part 7 of the Act in respect of employees covered by the Award. It therefore appears that s.92 (1)(b) of the Act operates to exclude the Applicant from Part 7 of the Act. We would appreciate your explanation as to how Mr West can competently proceed under Part 7. If you are of the view that our observations are incorrect, then please provide reasons. We reserve our client's rights in this regard, including to apply for summary dismissal of the proceedings. This can be raised at the next directions hearing. 30Newall C provided the Applicant with time to consider the jurisdictional issue raised by the Respondent. The Applicant decided to pursue the Part 7 claim which was ultimately decided in favour of the Respondent. 31The Part 6 application, filed on the first business day after the Part 7 application was determined, was made 11 months after the expiration of the prima facie time limit set by section 85 (1) of the Act. The Applicant was dismissed from employment on 12 February 2013. The s 84 application was not filed until 13 January 2014. 32No evidence was submitted by the Applicant that he was unaware of the limitation period. In fact, there was no dispute between the parties that the claim was filed out of time. 33That question is therefore answered in the affirmative.

Is the Commission prepared to exercise its discretion to accept the out of time application? 34In Paul Thomas and Repco Auto-tech, a division of the Distribution Group, [1999] NSWIRComm 108 (23 March 1999), the following six factors were identified for consideration in the exercise of the discretion available to the Commission regarding section 85 (3): (i) the length of the delay; (ii) the reason for the delay; (iii) the hardship to the applicant if the application is rejected; (iv) the hardship to the respondent if the application was not rejected; (v) the conduct of the employer relating to the dismissal; and (vi) the conduct of the applicant. 35The Respondent helpfully summarised the principles governing out of time applications as follows:

• The limitation period is not an arbitrary cut-off date unrelated to the demands of justice or the welfare of society; rather it represents the legislature's judgment that the welfare of society is best served by causes of action being litigated within the limitation period, notwithstanding that the limitation period may result in a good cause of action being defeated: McDiarmid v Shoalhaven City Council [2013] NSWIRComm 1024 at [15].
• It follows that the prima facie position is that an application out of time is excluded and the applicant bears the positive burden of demonstrating that the justice of the case requires an extension: Brisbane South Regional Health Authority v Taylor (1996) 186 CLR 541 per McHugh J; Lucic v Nolan (1982) 45 ALR 411 at [416].
• There is no prescription in the statute or in decided cases as to what constitutes a "sufficient reason" to extend time: Griffith Ex-Services Club Limited v Federated Liquor and Allied Industries Employees Union of Australia (NSW Branch) (1993) 51 IR 186 at 190; The decision to extend time involves a balancing of a range of considerations which may include an applicant's ignorance of the relevant time limit, whether an applicant has an arguable case and the Applicant's prospects of success: Hurrell v Queensland Cotton Corporation Limited (2003) 125 IR 145 at [12] - [13]; and
• The exercise of the discretion is ultimately governed by the requirements of justice in a particular case: Skelly v Prouds Jewellers Pty Ltd (1994) 53 IR 3 at 6. 36The factors identified in Repco are considered below against those Principles.

Reason for, and length of, the delay 37With respect to the reason for, and length of, the delay, the Applicant submitted the following: a. The Respondent failed, on three separate occasions, to advise him of the appeal mechanisms available to him despite the "unambiguous obligation" imposed on the Respondent by PD2005_225 Disciplinary Process and NSW Health - A Framework for Managing (the Disciplinary Process); b. The Part 7 Public Sector Disciplinary Appeal was filed within the prescribed time limit (on 4 March 2013); c. The jurisdictional issue was not raised by the Respondent either at, or prior to, the conciliation proceedings as is required by the Industrial Relations Commission which advises on its website, in relation to Public Sector Disciplinary Appeals, that: If the employer considers that there are any jurisdictional issues which may prevent the matter from proceeding to a hearing, those issues should be raised at the conciliation. It was not raised until more than two months after the conciliation conference. d. He was not aware of the existence of the MOU that existed between NSW Health and the HSU that removed his appeal rights pursuant to Part 7. However, the Respondent was aware of its provisions and its impact on him prior to Mr O'Connor's letter to him of 18 February 2013. He insisted that if Mr O'Connor had advised him of his appeal rights pursuant to Part 6, he would not have proceeded under Part 7. The Applicant stated that he believed that he had a choice between Part 7 and Part 6 proceedings and "I chose to appeal under Part 7". e. Following correspondence between the parties, he instructed his Solicitor to withdraw his Part 7 appeal and to lodge an out of time application under Part 6. He did not proceed with that intention when the Respondent objected to having the steps already taken in the Part 7 proceedings flow to the Part 6 proceedings. He submitted that if that objection had not been made, he would have proceeded under Part 6. f. Newall C had criticised the Respondent for its tardiness in filing the Notice of Motion challenging jurisdiction almost eight months after the dismissal and 4.5 months after first raising the issue with the Applicant. g. There was no delay between the time Newall C handed down his decision and the filing of this claim. He commenced Part 6 proceedings on 13 January 2014, the business day immediately following the handing down of Newall C decision in the Part 7 proceedings (10 January 2014) in which the Commission found in favour of the Respondent. 38The Respondent submitted, in response, that: a. The Applicant was, until recently, represented by experienced lawyers. b. The Applicant must be considered as having been aware of the relative advantages/disadvantages of proceeding under Part 7 compared to Part 6. c. Any doubts the Applicant may have had would have been dispelled by the comments made by Newall C on 15 November 2013. d. The Applicant, therefore, made an "informed" and "forensic" decision to persist in what his Solicitor called "his preferred jurisdiction" in preference to Part 6 proceedings. He did so, presumably, for two reasons. Firstly, because the focus of that section is on procedure and the applicant's focus is very much on procedural deficiencies. Secondly, the Applicant correctly apprehended a serious risk of a costs order in Part 6 proceedings but not under Part 7. There is therefore no injustice in holding him to that informed election. e. Parties are generally bound by the forensic decisions they make: Permanent Custodians Ltd v Adzioski [2013] NSWSC 804 at [14] citing Aon Risk Services Australia Limited v Australian National University [2009] 239 CLR 175 at 951; Seaton v Burnand [1900] AC 135 at 145. That is so, particularly in relation to unfair dismissal remedies where the legislature provides for Parts 6 and 7 of the Act as alternatives with applicants being obliged to weigh up the benefits and drawbacks of each course prior to making an election between those alternatives: see sections 85 (1), 90 and 99 (3). f. Therefore, the delay did not result from ignorance or incapacity. He was given the option by the Respondent to change courses and he declined. There is no injustice in holding the Applicant to his choice. 39The Applicant is seeking an opportunity to be heard on the merits of the claim so that he can clear his name of the allegations made against him. 40In submissions to the Commission, the Applicant conceded the following: (1)he had engaged solicitors from the outset, that is, from the time he was put on suspension until a few days prior to the hearing of the Part 6 threshold issue; (2)his Solicitors had advised him of the provisions of Part 6 and Part 7; (3)the Respondent's Solicitors advised him in June 2013 that he was proceeding under the wrong section; (4)the Respondent's Solicitors also advised him that the Respondent would not take issue with the out of timeness of the claim if he decided then to abandon the Part 7 proceedings and commence Part 6 proceedings; and (5)he had elected to proceed under Part 7. 41I accept the Respondent's submission that his legal representation from the outset rendered irrelevant the submissions of the Applicant about the lack of advice by Mr O'Connor on his appeal rights. 42I do not accept:

• the contention that the Applicant would have gone down the path of a Part 6 appeal if Mr O'Connor had advised him of that from the very beginning. I accept that there was no rational reason why the advice from the Respondent's Solicitors, supported by the views expressed by Newall C, would have been accepted in the first instance if it had come from Mr O'Connor; and
• that there was any obligation on Mr O'Connor to provide advice on external mechanisms for litigation. He did what I believe was required of him and provided advice on internal mechanisms of which there were none. 43The fact that the Respondent would not consent to the procedural orders sought by the Applicant and indicated that it would seek the standard directions instead is not a sufficient reason for the Applicant to reject the proposal. The Applicant could have relied on the evidence he had already prepared and submitted in the Part 7 proceedings without any further preparation on his part. 44I find that the reason for, and the length of the delay, were caused by the Applicant who, having had the benefit of legal advice on his options, and given time to consider the Respondent's proposal about aborting the Part 7 claim and pursuing, without demur on the jurisdictional issue, a Part 6 application, made an informed choice to continue down the path of a full hearing under Part 7 of the Act.

Hardship to either of the parties 45In relation to hardship that he would incur if the application is rejected, the Applicant submitted the following: a. He would have lodged his appeal in the appropriate jurisdiction had the Respondent advised him of the appeal mechanisms pursuant to the NSW Health Policy; b. He has suffered from a sense of isolation, emotional drain and stress. In addition, his close and extended family have suffered personal disadvantage and cost and have been confronted in a very real way with what the Respondent has taken away from them. c. He has exhausted his resources in his attempts to have the merits of his claim heard and the conduct of the Respondent examined relating to this dismissal; d. He has protested his innocence at every opportunity and actively pursued the Respondent through two jurisdictions. Despite spending all his money in that pursuit, he has not been provided with an opportunity to clear his name by defending himself against the serious allegations made against him; and e. He requires an opportunity to "fully expose the conduct of the WSLHD relating to the investigation of the allegations and [his] dismissal". 46In relation to hardship that it would incur if the application is accepted, the Respondent submitted the following: a. It conceded that it had notice for some time that the Applicant was contesting his dismissal and therefore will not suffer prejudice on the basis of lack of notice. Nevertheless, it will suffer precisely the prejudice that sections 85 (1), 90 and 99 (3) of the Act seek to avoid. It will incur the cost and effort in defending a further set of proceedings in respect of the same dismissal in addition to those unrecoverable costs expended in the Part 7 challenge: Public Employment Office, Department of Corrective Services v Boda (2005) 150 IR 169 at 177 [31] and Commissioner of the NSW Fire Brigades v NSW Fire Brigade Employees' Union (on behalf of Levy) [2009] NSWIRComm 138 at [21]. b. For his part, the Applicant will suffer the same hardship suffered by all other employees who are precluded by a time limit from prosecuting unfair dismissal claims - "a hardship imposed by the legislature as a corollary of the establishment of a limitation period". c. On that basis, the prejudice flowing to the Respondent weighs against the grant of an extension to the Applicant. 47In addition, the Respondent submitted that the burden should not be allowed to be imposed on the Commission pointing out that case management principles emphasise the burden on the public in terms of the drain on public resources. 48Consideration of hardship to the Employer involves more than mere consideration of the financial cost that might be incurred. The Employer is allowed to reasonably assume, at the conclusion of the 21 day limit, that its decision to terminate an employee would not be challenged and it can go on with its business operations. When a significant period beyond 21 days has elapsed, the employer is perfectly entitled to expect finality of the matter: McClymont and Thomson Financial Pty. Ltd. [2002] NSWIRComm 283. 49In Bimalananda Maity and Express Publications Pty Ltd [2001] NSWIRComm 169, Sams DP commented that: In a case where the onus is on the applicant to convince the Commission it should exercise its discretion in his favour, it is incumbent upon the applicant to bring positive evidence to demonstrate hardship. ..... merely asserting hardship is not good enough. Moreover, one might well imagine, if a dismissed employee was fearful of the economic hardship his dismissal might create, that a hasty decision would be made to lodge a claim, in the hope that some compensatory relief under Pt 6 ch 2 of the Act might result from the conciliation or arbitration proceedings. Having this in mind, I do not accept the applicant's bland assertion of hardship when he chose to wait seventy-seven (77) days before lodging his claim. 50I accept that the Respondent, whilst aware that the Applicant was disputing his dismissal from the outset, will nevertheless suffer precisely the prejudice that sections 85 (1), 90 and 99 (3) of the Act seek to avoid. Its costs in defending the Part 7 claim cannot be recouped. In addition, it is entitled to expect finality of the matter once a decision was handed down in the Part 7 proceedings. 51Apart from the bland assertion of hardship, no positive evidence was placed before the Commission to demonstrate hardship. I do not consider the aspect of financial hardship to be an issue and is not a persuasive factor.

Conduct of the employer related to the dismissal 52The Respondent submitted that s. 85 (3)(c) of the Act is directed towards the conduct of the employer relevant to the delay in the Applicant filing his claim: McDiarmid at [12]. 53The Respondent relied on the affidavit of Mr Gardner which set out the opportunities given by the Respondent to the Applicant to withdraw the Part 7 proceedings and commence Part 6 proceedings without objection. (Those opportunities are set out above in the overview.) It was submitted that the Respondent went beyond the call of duty and "did everything that could reasonably be expected of it in the circumstances". 54The Respondent concluded that there was nothing in its conduct relevant to the delay in the filing of the claim that weighs in favour of an extension. 55The Respondent pointed out that a consideration of the merits of the case would also weigh heavily against the grant of an extension of time. The Respondent's expert evidence demonstrated beyond any serious doubt that the allegations against the Applicant are well founded. It was pointed out that the proof of the Applicant's misconduct was compelling and unaffected by the procedure adopted in respect of his dismissal. It was also pointed out that not only does the Applicant's expert evidence not contradict its own expert evidence, but the Applicant ignored repeated invitations to convene a meeting of experts preferring to maintain his contention that his computer system must have been "hacked". 56The Respondent submitted that even if the Applicant were successful in demonstrating any procedural unfairness in the process of dismissal, such deficiency, on its own, would not render the dismissal unfair: In Farquharson v Qantas Airways Limited [2006] AIRC 488; (2006) 155 IR 22 the Full Bench held: [41] The fact of unfairness in the employer's decision making process, even if it involves a breach of a term in a certified agreement, is but a factor to be taken to account in determining whether a termination of employment was harsh, unjust or unreasonable. In circumstances where, as here, the merits of a termination of employment based on misconduct have been the subject of a full hearing in the Commission (in which the employer must establish the alleged misconduct on the balance of probabilities) and the dismissal has been found to be justified, it will be rare for a defect in an internal disciplinary process that preceded the termination justifying a conclusion that the termination was harsh, unjust or unreasonable. This is so because, almost invariably in such circumstances, it may be inferred that the outcome of the disciplinary process would have been the same even if there had been no such defect. 57The decision of the Full Bench is consistent with the comments of the High Court in Byrne v Australian Airlines (1995) 185 CLR 410 and reflects a similar approach to that taken by the Industrial Commission of NSW in Wang v Crestell Industries Pty Ltd (1997) 73 IR 454. 58The Respondent concluded that, given that the Applicant's prospects of success in the substantive application are very poor and will inevitably fail, it would not be in the public interest or in the interests of justice to grant the out of time application because "it will be time consuming, costly and ultimately pointless exercise, the burden of which will fall on the Commission and the respondent". 59The Applicant lay the blame for the delay in filing the claim at the feet of the Respondent. He submitted that the delay would not have occurred if: a. the Respondent had complied with the NSW Health Policy and advised him of the appeal mechanisms available to him; b. the Respondent had raised the issue of jurisdiction at the first conciliation conference; c. the Respondent had not applied a condition to the switch to a Part 6 application; and d. the Respondent had not delayed taking issue with jurisdiction thereby resulting in the vacation of the December hearing dates. 60The Applicant submitted that if the claim is rejected as a result of it being out of time, it would have a detrimental impact on his substantive rights, he would be denied natural justice and "a terrible injustice will have been perpetrated" because he has not been able to defend himself against the serious allegations made against him. He would be denied the opportunity to expose the conduct of the Respondent relating to the investigation of the allegations and his ultimate dismissal. He pointed out that he had protested his innocence at every opportunity and had actively and consistently pursued the Respondent through two jurisdictions. 61The Respondent hired an IT professional who produced the second report which was based on the most basic level of information that the department has, that is, the raw proxy logs. It was pointed out that the Applicant's expert agreed that the raw proxy logs are the best evidence of internet access as they are obtained from the server which records, within a millisecond, all internet access by date, time and location. The IT professional's examination confirmed that there had been very extensive access to inappropriate material via the Applicant's login and that the access occurred at times when the Applicant was at work and did not occur on days when he was not at work or on leave or on suspension. 62The Respondent advised that it repeatedly asked for expert conclaves "because it's the start and the finish of the matter so far as the substance goes". The Applicant refused to allow his expert to participate. At the hearing, when pressed, he indicated that his expert went overseas for a couple of weeks. Considering the amount of data collected by the Respondent, I accept that it would be a very time consuming and costly exercise arbitrating such a claim without the assistance of the expert conclave sifting through the material and arriving at some agreed conclusions. 63The Commission is required to concentrate on whether or not there was evidence of conduct by the employer which inhibited or prevented the Applicant from lodgement of the claim within time. Apart from the observations made in [61] and [62] above, I do not consider it helpful to embark on an assessment of the substantive matter: Robert Stanley Green v. Mayne Nickless Ltd trading as Armaguard. [2008] NSWIRComm 40. 64There was no conduct of the Respondent demonstrated to me as being a contributing factor to the delay in the Applicant lodging his claim.

CONSIDERATION 65Section 85 (1) of the Act provides that an application made pursuant to Chapter 2, Part 6 of the Act must be made not later than 21 days after the dismissal of the employee. 66The Act has a limitation period in order that employers may arrange their businesses without having to fear litigation after the expiration of the prescribed period. In addition, s.162 (2)(a) of the Act requires the Commission to act as quickly as is practicable. That was reinforced in Kent Gorrell v Uwatec Pty Ltd (Unreported) IRC 1700 of 1999, 11 November 1999 in which it was stated that there is a public interest in the prompt institution and prosecution of litigation before the Commission. 67The intention of the legislature to ensure that the balance of justice is fairly applied to both parties is imperative. 68Statutory limits should be adhered to and should neither be treated, nor perceived, as "trivial" or an administrative inconvenience. McHugh J. in Brisbane South Regional Health Authority v. Taylor (1996) 139 ALR 1 held that: The discretion to extend time must be exercised in the context of the rationales for the existence of limitation periods. For nearly 400 years the policy of the law has been to fix definite time limits (usually six but often three years) for prosecuting civil claims. The enactment of time limitations has been driven by the general perception that "[w]here there is delay the whole quality of justice deteriorates.... 69Section 85(3) has been interpreted quite narrowly by the Commission with late applications only being allowed in extreme circumstances. 70In Uwatec, Sams DP summarised the relevant principles relating to out of time applications in unfair dismissal matters as follows: (a) The Commission's power to accept out of time applications is discretionary; (b) The onus rests on the Applicant to convince the Commission of a "sufficient reason" to accept an out of time application; (c) It is inappropriate to establish a rigid definition of what constitutes a "sufficient reason". Each case must be considered on its own facts and circumstances; (d) There is a definite purpose in the power of the Commission to exercise its discretion in extending the time limit of twenty-one days; just as there is a definite purpose in the legislature establishing time limitations for filing; (e) There is a public interest in the prompt institution and prosecution of litigation before the Commission; (f) The discretion to allow out of time applications is directed to ensuring that justice is afforded to both parties; (g) Each of the subclauses (a), (b) and (c) in s. 85 (3) should be addressed and an explanation provided. It is only necessary to establish a sufficient reason for the Commission's discretion to be exercised; and (h) Ignorantia legis neminem excusat (ignorance of the law excuses no one). 71The Commission has discretion to accept late applications if there is a "sufficient reason to do so". 72The set of facts and circumstances of each case determine whether there is "sufficient reason" to exercise that discretion. 73The discretion to allow out of time applications is for the purpose of ensuring that justice is afforded to both parties. 74I concur with the submission of the Respondent that it would create a dangerous precedent if an informed employee, who settled on a course of action well aware of, and warned about, the risks associated with that choice, is able to escape the consequences of that election. 75Having regard to the provisions of Section 85 (3) of the Industrial Relations Act 1996, I do not regard that the Applicant has discharged the onus of proof to establish a sufficient reason for the delay and hereby decline to accept the out-of-time application. The requirements of the Act have not been sufficiently satisfactorily met to allow the Commission to make a discretionary decision in terms of allowing the claim to be accepted. A proper examination of those factors causes that discretion to be exercised in the Respondent's favour. 76Matter IRC 16 of 2014 is hereby concluded by rejection of the Applicant's application for the Commission to exercise its discretion to allow the out of time application.

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: 29 October 2014