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[2019] FWC 3332
Fair Work Commission
2019-06-14
Original judgment source is linked above.
[2019] FWC 3332 [Note: An appeal pursuant to s.604 (C2019/4101) was lodged against this decision - refer to Full Bench decision dated 9 July 2019 [ [2019] FWC 4783] for result of appeal.]
s.394 - Application for unfair dismissal remedy
BlueScope Steel Limited T/A BlueScope Steel Limited Springhill Works
[1] Mr Zaki Habak (the Applicant) made application for an unfair dismissal remedy in accordance with section 394 of the Fair Work Act, 2009 (the Act), on 10 January 2019 following his termination from BlueScope Steel Limited T/A BlueScope Steel Limited Springhill Works (the Respondent) on 21 December 2018.
[2] The Applicant had worked for the Respondent for more than 39 years. The Applicant worked in the Painting and Finishing Department (PFD) of the Respondent at Springhill, as a Despatch Operator Level 3. The Applicant was required to drive a number of overhead cranes to load and unload trucks with steel coils and to move these coils around the warehouse. The Applicant was an experienced Operator and had driven cranes at the Respondent for the past 28 years.
[3] The Applicant was represented at the Hearing by Ms Jamila Gherjestani, Senior Legal Officer of the Australian Workers' Union, NSW Branch. In accordance with section 596(2) of the Act, leave was granted for the Respondent to be represented by Ms Alice De Boos, Partner from K & L Gates. The Hearing was conducted in Wollongong on 9 May 2018.
[4] Witness statements were attested by the Applicant (Despatch Operator 3), Mr Fernandes (Despatch Operator) and Mr Knowles (Despatch Operator) for the Applicant and by Mr Gary Meta (PFD Operations Manager) for the Respondent. Mr Meta's statement included a USB which contained actual footage of the incident but from a different angle on the other side of the warehouse and a video "re-enactment" from the crane's cabin.
[5] On 8 December 2018, the Applicant was driving crane 13 whilst working night shift. The cabin of crane 13 traverses the western side of the warehouse approximately 5 metres above the floor in the north-south direction. The hook of the crane, which is a C-hook, can only travel east-west or up and down. At approximately 11.30pm the Applicant was requested, to unload a truck and return the coils to the coil field as the load had been cancelled.
[6] After placing the coil in the required position in row A, the row furthest from the crane's cabin some 25-30 metres away, the Applicant attempted to remove the crane's hook from the coil. As a result of this process, the coil was tipped onto the walkway.
[7] The Applicant immediately advised his supervisor of this occurrence. The Applicant was sent for mandatory drug and alcohol testing, which returned a negative result. The Applicant resumed work for the remainder of the shift, but was confined to perform duties on the ground and not drive any cranes.
[8] The Applicant met with his Departmental Operations Manager, Mr Gary Meta on 12 December 2018. The Applicant was stood down, on pay, at the conclusion of this meeting to allow the Respondent to conduct an investigation into the incident. The Respondent met with the Applicant on 19 December 2018. The Respondent advised the Applicant that the investigation had concluded that the Applicant had operated crane13 in a manner which breached Critical Safety Policy 031 (CSP031). As a result, the Respondent was considering terminating the Applicant's employment. The Applicant was asked to provide reasons why he should not be terminated.
[9] The Applicant met with the Respondent on 20 December 2018 and provided the following written response:
I make this statement to show cause why I should not be terminated from my employment.
On Saturday 8 December 2018 I was working night shift, driving 13 crane when the incident happened.
I took a coil off the truck and placed it in the field, after placing the coil on the choc, I proceeded to cross travel west to remove the hook from the bore of the coil. From the crane cabin the hook looked to be clear of the coil. When I proceeded to lift, the tip of the hook clipped the bore of the coil, as soon as I realised what was happening I immediately went down with the hoist and west with tight breaks, meaning that we have had to make so many applications to get a movement to cross travel.
I recognise that I have been warned over 2 other incidents over the last 12 months in the same circumstances within same distance from the cabin which have all occurred on night shifts.
I have been a crane driver in this department for over 25 years, prior to the last 12 months I had no issues with my work ethics or performance. In the last 12 months I have had personal and medical issues (eyesight).
I believe I have been a good and reliable employee with strong work morals. I regret the incidents that have occurred that were never, ever intentional. I am trying to address my personal issues outside of work be seeking counselling, resigning from my outside commitments and have had an eyesight test which showed distant vision loss in my left eye which I was never aware of. I have been advised by the optometrist that I now require glasses for long distances which I intend to wear.
I have always been employed and need to work to support my family as I am the sole earner. I feel remorse over these incidents after 39 years of service to BlueScope therefore I am willing to accept anything that is required by the company for me to do, in order for me to maintain my position in BlueScope."[1]
[10] On 21 December 2018, the Applicant attended a meeting with the Respondent and was provided with the following termination letter:
A meeting was held with you on Wednesday 12 December 2018 to discuss a serious incident that took place on 8 December 2018. On this occasion you drove 13 crane in breach of the critical procedure CSP031 which resulted in a coil being tipped over falling onto the workway.
The Company interviewed you regarding this incident on 8 December 2018, and in arriving at its decision your responses along with all of the information available has been taken into consideration. The Company has also taken into consideration your employment record which includes a number of recent performance issues resulting in warnings for failing to carry out your role in a safe manner as required by our Critical Procedures, including a final written warning being issued to you on the 6 July 2018.
On Wednesday 19 December 2018 you were advised of the outcome of the investigation into these incidents and informed that the Company was considering terminating your employment. You were invited to raise any matters as to why you considered the Company should not terminate your employment. A letter received from you in response to this request has been considered by Company representatives in arriving at its decision.
As a result of your most recent incident, the Company requested that you not attend work and you would be paid whilst the investigation and outcome was concluded. The investigation has been concluded, and the Company has determined that you are incapable of performing the role of an operator safely, and your ongoing employment with the Company constitutes an unacceptable risk to yourself and others, and to our business, and as such your employment will be terminated effective as of today's date.
The Company will pay you five weeks pay in lieu of notice. You will be paid any accrued entitlements and outstanding remuneration, including superannuation, up to and including the date of this letter. Final payment details will be sent to your mailing address.
Travel to coil and lower C-Hook to coil bore. Use visuals to line up hook to prevent damage and avoid knocking over coils.
Always check for people or equipment around the coil being moved.
Sound horn and wait for area to be clear before accessing.
Ensure hook is fully engaged against coil and ropes vertical before hoisting. Take extra care when not inserting hook fully for doubling up coils; hoist slowly, stop if lift looks unsafe. If unsure on staggered coils contact STL before lifting.
Never move crane if people are in the line of fire.
Place coil in desired location gently. Ensure the hook is clear of coil bore before hoisting. Watch the load and C-Hook when removing and hoisting.
Ensure coils are place centrally in and supported by chocks in coil field. Report damaged chocks to CMS controller.
[12] The relevant sections of the Act in relation to this matter are:
(a) to establish a framework for dealing with unfair dismissal that balances:
(i) the needs of business (including small business); and
(b) to establish procedures for dealing with unfair dismissal that:
(ii) address the needs of employers and employees; and
(c) to provide remedies if a dismissal is found to be unfair, with an emphasis on reinstatement.
(2) The procedures and remedies referred to in paragraphs (1)(b) and (c), and the manner of deciding on and working out such remedies, are intended to ensure that a "fair go all round" is accorded to both the employer and employee concerned.
Note: The expression "fair go all round" was used by Sheldon J in in re Loty and Holloway v Australian Workers' Union [1971] AR (NSW) 95.
382 When a person is protected from unfair dismissal
A person is protected from unfair dismissal at a time if, at that time:
(a) the person is an employee who has completed a period of employment with his or her employer of at least the minimum employment period; and
(ii) an enterprise agreement applies to the person in relation to the employment;
(iii) the sum of the person's annual rate of earnings, and such other amounts (if any) worked out in relation to the person in accordance with the regulations, is less than the high income threshold.
A person has been unfairly dismissed if the FWC is satisfied that:
(b) the dismissal was harsh, unjust or unreasonable; and
(c) the dismissal was not consistent with the Small Business Fair Dismissal Code; and
(d) the dismissal was not a case of genuine redundancy.
Note: For the definition of consistent with the Small Business Fair Dismissal Code: see section 388.
In considering whether it is satisfied that a dismissal was harsh, unjust or unreasonable, the FWC must take into account:
(a) whether there was a valid reason for the dismissal related to the person's capacity or conduct (including its effect on the safety and welfare of other employees); and
(b) whether the person was notified of that reason; and
(c) whether the person was given an opportunity to respond to any reason related to the capacity or conduct of the person; and
(d) any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal; and
(e) if the dismissal related to unsatisfactory performance by the person - whether the person had been warned about that unsatisfactory performance before the dismissal; and
(f) the degree to which the size of the employer's enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(g) the degree to which the absence of dedicated human resource management specialists or expertise in the enterprise would be likely to impact on the procedures followed in effecting the dismissal; and
(h) any other matters that the FWC considers relevant.
[13] The Applicant has admitted that he tipped the coil. That fact is not in dispute. The Applicant has argued though that the tipping of the coil does not provide the Respondent with a valid reason to terminate his employment.
[14] Further, that one of the reasons that the coil tipped was due to the malfunction of crane 13, where the cross travel breaks were faulty. The Applicant claims that this issue had been raised with the Respondent on a regular basis for more than 6 months but the Respondent had simply ignored the employees' concerns.
[15] Also, the two earlier warnings that had been issued by the Respondent to the Applicant over the last 12 months should not be taken into account because they were not "sound, defensible or well founded". The Applicant also submitted that because the Respondent's disciplinary procedure is outside the purview of the FWC and the employee does not have access to any right of appeal associated with any disciplinary decision of the Respondent, apart from termination, the process is procedurally unfair and should be ignored.
[16] The Applicant submitted that, even if the Respondent had a valid reason to terminate the Applicant, the decision by the Respondent was harsh, unjust or unreasonable. The Applicant argued that the FWC must take into account:
the Applicant's 39 years of continuous service with the Respondent;
the fact that the Applicant is 57 years of age with 5 financially dependent family members living with him;
the Applicant has a mortgage and loans of approximately $600,000; and
the fact that the Illawarra Region has a high unemployment rate and that he has been unable to find alternate employment in the Illawarra and beyond.
[17] The Respondent submitted that the Applicant had breached a critical safety procedure (CSP031) for the third time in twelve months thereby giving it a valid reason to terminate the Applicant's employment.
[18] The Respondent argued that the Applicant is a highly skilled and experienced crane operator who, like his colleagues, adapts his operation of the cranes in PFD to suit the operating mannerisms and restrictions of the variety of cranes every day, in order to operate in a safe and efficient manner.
[19] The Respondent highlighted that only 6 coils have been tipped or dropped in the PFD since January 2017, and that the Applicant was responsible for 3 of those incidents in the last 12 months. Further, crane 13 has moved 90,000 coils in the last two years and the only coil to be tipped was by the Applicant on 8 December 2018.
[20] The Respondent argued that the Applicant has a clearly identified problem with following safety instructions and that his ongoing employment provides a safety risk to his colleagues. The Respondent submitted that it takes very seriously its obligations under the Work Health and Safety Act (NSW) 2010.
[21] The Respondent submitted that it had a right to expect a highly skilled, trained and qualified operator, like the Applicant, would work in a safe manner in the workplace. As a result, it could not turn a blind eye to the Applicant's unsafe actions.
[22] The Respondent also highlighted that the Applicant had changed his explanation of what occurred on the evening of 8 December 2019:
"Since the Incident, the Applicant has provided different reasons for why the Incident occurred. On the night of the Incident he admitted to his supervisor that he misjudged the movement and it was driver error. On 12 December 2019 (sic) he admitted to Mr Meta that he did not see the crane swinging at all and he was fatigued on the night. On19 and 20 December 2019 (sic) he blamed the Incident on a failure of the cross-travel brakes but also said his eye-sight had deteriorated. In his Application, he sought to place blame on the Respondent's alleged failure to conduct vision testing. In the Applicant's evidence he made a vague allegation that Crane 13 had further issues on the night of the Incident but has failed to provide any specific evidence regarding this."[4]
[23] As a result of the Applicant's adaptive explanation, the Respondent invited the Commission to adopt the initial explanation provided by the Applicant as the accurate explanation of what occurred and that he had simply misjudged the movement of the crane.
[24] The Respondent claims that it considered the Applicant's length of service, previous disciplinary history and the option of an alternate work placement prior to dismissal but, after careful consideration and peer review, decided that terminating the Applicant's employment was the appropriate course of action.
[25] The Commission conducted an inspection of the PFD on 5 April 2019. During the inspection, Mr Fernandes drove crane 13. The Applicant, Mr Meta and myself were in the crane with Mr Fernandes. The crane is old, noisy and provides a bumpy ride as it traverses the warehouse in a north-south direction. Mr Fernandes was asked to pick up a coil from the same location as the coil that was tipped by the Applicant. Mr Fernandes raised this coil and then placed it back on its chocks. Mr Fernandes then removed the C-hook from the coil. I noted that the back of the hook touched the coil that was in the bay immediately behind it even though it was offset. I noted that the coils were "wrapped" so inadvertent touching does not cause any damage to the coil. In order for Mr Fernandes to make the coil travel in an east-west direction, Mr Fernandes had to flick the joystick on an excessive number of occasions in order to get the crane to respond appropriately. I also noted the high visibility of the coil farm and its surrounds from the elevated position of the crane operators cabin. I have taken into account the high level of skills required to manipulate crane 13 to place it on chocks some 25-30 metres away when the surrounding area is full of other coils.
[26] When considering whether a termination of an employee was harsh, unjust or unreasonable, the oft-quoted joint judgement of McHugh and Gummow JJ in Byrne v Australian Airlines (Byrne) is of significance:
"It may be that the termination is harsh but not unjust or unreasonable, unjust but not harsh or unreasonable, or unreasonable but not harsh or unjust. In many cases the concepts will overlap. Thus, the one termination of employment may be unjust because the employee was not guilty of the misconduct on which the employer acted, may be unreasonable because it was decided upon inferences which could not reasonably have been drawn from the material before the employer, and may be harsh in its consequences for the personal and economic situation of the employee or because it is disproportionate to the gravity of the misconduct in respect of which the employer acted.
... In Lane v Arrowcrest Group Pty Ltd, von Doussa J considered the example of the dismissal of an accountant who held a position of trust where it was discovered after the dismissal that the accountant had been systematically embezzling money from the employer. His Honour said it would be astonishing if the employer could not resist an allegation that the dismissal was harsh, unjust or unreasonable, within the meaning of the relevant award, by pointing to those facts discovered after the dismissal, so long as they concerned circumstances in existence when the decision was made. His Honour concluded:
"Whether the decision can be so justified will depend on all the circumstances. A circumstance, likely to favour the decision to dismiss, would be that fraud or dishonesty of the employee had caused or contributed to the employer's state of ignorance. A circumstance likely to weigh against the decision would be that the employer had failed to make reasonable inquiries which would have brought existing facts to its knowledge before the dismissal occurred.""[5]
"The above extract is authority for the proposition that a termination of employment may be:
[28] I now turn to the provisions of section 387 of the Act to determine whether the Applicant's termination was harsh, unjust or unreasonable.
[29] I have taken into account all of the evidence and materials that have been submitted to the Commission. The fact that an issue does not appear in this decision does not mean that it has not been taken into account.
[30] I have taken into account the list of objections that were raised by the Respondent to the witness statements in support of the Applicant. Whilst the Commission is not bound by the "Rules of Evidence" (see section 591 of the Act), I have given the evidence the weight that it is appropriate in this circumstance.
[31] The meaning of the phrase "valid reasons" has been universally drawn from the judgement of Northrop J in Selvachandran v Peteron Plastics Pty Ltd:
"In broad terms, the right is limited to cases where the employer is able to satisfy the Court of a valid reason or valid reasons for terminating the employment connected with the employee's capacity or performance or based on the operational requirements of the employer. ...
Section 170DE(1) refers to "a valid reason, or valid reasons", but the Act does not give a meaning to those phrases or the adjective "valid". A reference to dictionaries shows that the word "valid" has a number of different meanings depending on the context in which it is used. In the Shorter Oxford Dictionary, the relevant meaning given is: "2. Of an argument, assertion, objection, etc; well founded and applicable, sound, defensible: Effective, having some force, pertinency, or value." In the Macquarie Dictionary the relevant meaning is "sound, just, or well founded; a valid reason".
In its context in s 170DE(1), the adjective "valid" should be given the meaning of sound, defensible or well founded. A reason which is capricious, fanciful, spiteful or prejudiced could never be a valid reason for the purposes of s 170DE(1). At the same time the reason must be valid in the context of the employee's capacity or conduct or based upon the operational requirements of the employer's business. Further, in considering whether a reason is valid, it must be remembered that the requirement applies in the practical sphere of the relationship between an employer and an employee where each has rights and privileges and duties and obligations conferred and imposed on them. The provisions must "be applied in a practical, commonsense way to ensure that" the employer and employee are each treated fairly..."[8]
[32] In Rode v Burwood Mitsubishi, a Full Bench of the Australian Industrial Relations Commission held:
"... the meaning of s.170CG(3)(a) the reason for termination must be defensible or justifiable on an objective analysis of the relevant facts. It is not sufficient for an employer to simply show that he or she acted in the belief that the termination was for a valid reason."[9]
[33] In Qantas Airways Ltd v Cornwall, the Full Court of the Federal Court of Australia said:
"The question is whether there was a valid reason. In general, conduct of that kind would plainly provide a valid reason. However, conduct is not committed in a vacuum, but in the course of the interaction of persons and circumstances, and the events which lead up to an action and those which accompany it may qualify or characterize the nature of the conduct involved."[10]
[34] In B, C & D v Australian Postal Corporation t/a Australia Post (Australia Post), a Full Bench of the Commission held:
"A failure to comply with a lawful and reasonable policy is a breach of the fundamental term of the contract of employment that obliges employees to comply with the lawful and reasonable directions of the employer. In this way, a substantial and wilful breach of a policy will often, if not usually, constitute a "valid reason" for dismissal."[11]
[35] The Applicant was issued a written warning on 11 December 2017, which contained the following:
The investigation of the incident identified the following key points:
The Company is concerned about your behaviour as a crane driver and as an employee. You must follow and adhere to Critical Procedures at all times.
[36] On 6 July 2018, the Applicant was issued with a final written warning which stated:
The Company has been investigating incident involving your driving of the 14 crane. This incident occurred on the 30 June 2018. During your driving of 14 crane you lost control of the coil you were lowering into the coil field. The tong and coil landed on the adjoining coil causing the tong to tip and resulted in the coil falling to the ground. The coil then toppled back against the now damaged adjoining coil and remained upright...
The investigation of the incident identified the following key points:
It is acknowledged that on 6 December 2017 you received a warning following an incident that resulted in a coil being dropped on a stand sustaining sever damage.
The Company is concerned about your behaviour as a crane operator and as an employee. You must follow and adhere to Critical Procedures at all times.
As a result of investigation and the seriousness of the incident, you are being issued this Final Warning. I urge you to take this Final Warning seriously. Failure to address this behaviour may result in further disciplinary action up to and including termination of your employment.
You are to receive retraining in the form of re-accreditation in CSP031. You are expected to make a commitment to operate the crane safely at all times taking the appropriate care to operate the crane safely and adhering to your Standard Operating Procedures and training. Further, you must adhere to the Critical Safety procedures you have been accredited in. You will be suspended from operating cranes and confined to loader duties until you successfully complete these requirements.
[37] The relevant sections of CSP031 in relation to this incident have been highlighted earlier. The safety requirement or task which the crane operator must follow in the procedure for crane 13 are in relation to the lifting of a coil, the placement of the coil, the removal of the hook from the coil and to ensure that there are no people in the "line of fire". The three experienced crane drivers all gave evidence that this phrase means that if anybody is in the vicinity of where you are to put the coil then you simply stop and wait for the area to be cleared. I have taken this into account.
[38] I was impressed by the honesty and clarity of Mr Fernandes' evidence and his assistance in driving crane 13 during the inspection. Mr Fernandes testified that the speed in which the crane operator was operating crane 13 during the re-enactment video was the normal speed at which the crane was normally operated.
In relation to the speed in which that coil was placed and the C-Hook removed, is that the normal speed of operation?---That is the normal speed.
So that's how fast you would normally work?---Yes, it is. That's correct."[14]
[39] I have taken this into account.
[40] I note that the Applicant was of the opinion that the video was taken in slow motion or that the task was performed in slow motion.
Thank you?---Plus this video it taken in slow motion. We don't work in slow motion.
MS DEBOOS: I don't think it's in slow motion?---I think they're doing it a step at a time. They put the coil down, they move slowly - yes, it's done in slow motion. We don't work in slow motion in the workplace.
THE COMMISSIONER: Pardon. Let me try and clarify it. Are you saying that this video was taken - was the tasks performed at a speed a lot slower than would normally - - -?---Definitely.
But isn't the speed of your crane your decision as to you're required to work safely?---Yes, but we also need to perform the work, need to do the work and keep up with the tasks. If we were to work - - -
Well are you saying there was a number of lifts that you had to undertake each hour, or - - -?---When you've got trucks to load and stands to empty and this and that, you're expected to work at a pace where you keep up with the work."[15]
[41] I have taken these issues into account.
[42] I agree with Ms Gherjestani that there is an element of procedural unfairness in the Respondent's disciplinary process on the basis that the steps prior to termination are not open for external review or appeal. However, in the present circumstance, it would appear that the Applicant had concurred with the Respondent's findings and disciplinary decisions. I note that the Applicant signed both of his earlier warnings. There were no written comments from him disputing these warnings. If the Applicant had disagreed or objected to the warnings he should have refused to sign either document or made a note identifying his protest at being issued these warnings.
[43] Mr Meta testified that since January 2017, more than 90,000 coils have been moved in the Department by crane 13 with only 1 coil being tipped or dropped - the coil tipped by the Applicant. I accept the evidence of the three crane drivers that they use their skill and expertise to operate the crane, irrespective of its malfunction or operational deficiency.
[44] I have taken this into account.
[45] BlueScope has an expectation that its' employees will work in accordance with its policies and procedures. I am of the view and find that the Applicant has breached policy CSP031 on three separate occasions within the last year. Whilst I agree with the views of Mr Meta that the Applicant did not act with any malice or deliberate intent, the Applicant clearly did not take sufficient care when hoisting away from the coil. The failure to follow this policy for the third time provided the Respondent with a valid reason to terminate the Applicant.
[46] I find that BlueScope had a valid reason to terminate the Applicant's employment.
[47] In Crozier v Palazzo Corporation, a Full Bench of the Commission said:
"As a matter of logic procedural fairness would require that an employee be notified of a valid reason for their termination before any decision is taken to terminate their employment in order to provide them with an opportunity to respond to the reason identified. Section 170CG(3)(b) and (c) would have very little (if any) practical effect if it was sufficient to notify employees and give them an opportunity to respond after a decision had been taken to terminate their employment. Much like shutting the stable door after the horse has bolted."[16]
[48] The Applicant was notified of the reason for his termination at a meeting with the Respondent on 21 December 2018 and confirmed by correspondence of the same date.
[49] I am satisfied that the Applicant was notified of the reason for his dismissal.
[50] In Gibson v Bosmac Pty Ltd (Gibson), Wilcox CJ said:
"Ordinarily, before being dismissed for reasons related to conduct or performance, an employee must be made aware of the particular matters that are putting his or her job at risk and given an adequate opportunity of defence. However, I also pointed out that the section does not require any particular formality. It is intended to be applied in a practical, commonsense way so as to ensure that the affected employee is treated fairly. Where the employee is aware of the precise nature of the employer's concern about his or her conduct or performance and has a full opportunity to respond to this concern, this is enough to satisfy the requirements of the section."[17]
[51] On 19 December 2018, following an internal investigation, the Applicant was invited to raise any issues as to why the Respondent should not terminate his employment. The Applicant provided a written response to the Respondent the following day.
[52] I am satisfied that the Applicant was provided with an opportunity to respond.
[53] The Applicant was not prevented from bringing a support person to any of the meetings during the disciplinary process.
Section 387(e) Warning about unsatisfactory performance
[54] The Applicant received a written warning on 6 December 2017 for failing to operate a crane safely in accordance with CSP031. The Applicant received a final written warning on 6 July 2018 for failing to operate a crane safely in accordance with CSP031.
[55] Mr Meta's testimony on this issue is of relevance:
...Under what I would regard as the Old Mates Act in a workplace, as a long-serving employee why wouldn't you pull him aside and say, "Look, Zak, I think there's a problem here. Your attitude seems to be a bit skew-whiff. What's wrong"?---Well, I did do that. That happens at the beginning, so before - at the time of the first warning we did have a frank discussion. We are on cordial terms. That incident demonstrated great complacency and negligence on his part, and we did have a frank discussion then.
What about when you issued the final written warning though?---When I issued him a final written warning we had another discussion and it had been six months, and he - six months had passed. He moved a lot of coil, but he had made another poor decision.
I don't want to put words in your mouth, but is that what you're saying to me? The major issue as far as you're concerned - the reason why Mr Habak was terminated rather than demoted was because of this serious safety issue?---He has shown repeated failures in being able to carry out his role safely; move coils safely. His failures have been fundamental; basic operation."[18]
[56] I am satisfied that the Applicant had previously been warned about his unsatisfactory performance.
Section 387(f) Size of Enterprise - Procedures Followed
[57] The Respondent is a large employer which appears to have followed its internal disciplinary procedures. I have taken this into account.
[58] The Respondent has a dedicated and experienced HR team. I have taken this into account.
[59] The Applicant has been employed by the Respondent for an inordinately long 39 years. Whilst the Applicant was not a cleanskin in relation to his disciplinary history, up until the most recent issues, there had been no real performance issues since 2006. I also note that the Applicant received a "Sustained High Performance" commendation from his Supervisor in May 2014.
[60] I find that the Applicant's disciplinary record is more than satisfactory for an employee with 39 years' service. From my 26 years' experience in dealing with Respondent, whilst in no way criticizing the Respondent, I note that the Respondent takes a more than proactive attitude in relation to its internal disciplinary processes. This has been a deliberate policy approach on behalf of the Respondent in order to maintain discipline and safety over its large blue collar workforce. I have taken this into account.
[61] I have taken into account that, from my previous experience, there are a plethora of employees who have multiple final warnings. Mr Knowles is but one of those employees. The Respondent's internal disciplinary process is a matter for the Respondent, however, the inconsistent application of the policy, across both organisations and sites, can sustain an argument of unfairness. I recommend that the parties to the Agreement negotiate a way for the disciplinary process to be applied to ensure a consistent application.
[62] The Applicant testified that he is the sole income provider for his dependant wife, 3 children and elderly father, who all reside with him in the family home. The Applicant has a mortgage and a personal loan of $600,000. The Applicant's only other asset is the old family home. I have taken this into account.
[63] The Applicant has applied for dozens of jobs in the Illawarra area, without success. The Applicant has also applied for employment in the Sutherland Shire, which is some (50km) away from his home. Whilst the Applicant has transportable skills, globalisation and the introduction of robotics has led to a decrease in demand for those skills. I note that the Applicant has sought employment in a variety of fields, not just crane driving. I also note the higher than average unemployment rate in the Illawarra region and the on-going difficulty that the Applicant will encounter in finding employment due to his age. I have taken these issues into account.
[64] I have taken into account that Mr Meta has never driven crane 13 and is not the Applicant's direct report. I note that the Applicant's direct report, Mr Costello did not provide evidence in these proceedings.
[65] I have taken into account the unchallenged evidence that the operation of crane 13 had been the subject of complaint by the Applicant and his colleagues at tool box meetings and in daily checklists for more than 6 months. I understand the economic basis of "sweating" an asset, however, a crane with more than 40 years' service which rides and operates, in my view, very roughly and whose operation has been continuously raised as an issue with Management, may require some extensive maintenance, overhaul and/or replacement. I also note that crane 13 does not have sensors or warning lights to identify when the hook is clear from the coil. In reality, the operation of crane 13 is based on the skills and "eye" of the operator.
[66] I have taken into account the terms of CSP031. I am not convinced that the tipping of a coil is necessarily a significant safety issue. There were no employees in the vicinity of the coil. If there were, the Applicant's testimony, supported by both Mr Fernandes and Mr Knowles was that the crane operator would simply stop until the person on the ground was no longer in "the line of fire". The vision from the crane cabin is excellent. If anybody had been in the walkway then the Applicant would have been able to see them. The Applicant's unchallenged evidence was that he would always stop if there was a person within 6-10 metres of his load. I do not accept the scenario as portrayed by Mr Meta:
"You gave an example of a truck driver walking through. That policy that your employees - BlueScope employees - are following says, "Never move crane" - so not any parts of the crane - "while people are in the line of fire", which means if hypothetically Mr Habak saw a truck driver walking in, Mr Habak would have paused and stopped in accordance with that policy. That's what the policy says?---That's one possibility."[19]
[67] Mr Meta raised the issue that the tipped coil may have fallen onto another employee or truck driver due to the vicinity of the toilets. The Applicant's representative challenged this possibility, arguing that the toilets were not near where the coil was tipped. I note that Mr Meta did not identify the location of the toilets during the inspection on 5 April 2019. On 11 June 2019, I asked both parties to provide me with a sketch of the warehouse identifying the location of the toilets. The AWU provided a photo, which I will identify as MFI2, which shows that the toilets are in close proximity to the truck loading bay but some 30 metres from where the coil was tipped. The Respondent provided a detailed floor plan which I will mark as MFI3 which shows the same information. There would be absolutely no reason for a truck driver to be anywhere near the bay where the coil was tipped. I also note from the video that the truck driver was approximately 50metres away from the tipped coil next to his truck. I have taken this into account.
[68] I find that the Applicant's tipping of a coil on 8 December 2018 did not create a safety incident. I note that the Applicant's termination letter specifically states that he was "incapable of performing his role safely".
[69] Mr Meta appeared to be confused over whether the Applicant was terminated for his actions being unsafe or for his negligence or lack of consistency:
Can you describe for the Commission what the primary considerations were for you in reaching your decision to terminate?---The coil was tipped over into a walkway. It's a higher risk than if the coil is tipped over in the middle of the field. Over a walkway, that puts people - the possibility of people being in that position.
If exactly the same series of events had occurred yet the coil was placed somewhere else in the field - if that's what you call it - would you have formed the same conclusion about Mr Habak's employment?---The underlying issue is his application of his skill on the task at hand and his inability to do that consistently."[20]
[70] I have taken this into account.
[71] I have viewed the video that was taken of the actual incident from the opposite side of the warehouse from the crane cabin on a dozen occasions. I have paid particular attention to the swinging of the hook. The hook swung 4 times after the Applicant had put the coil on the ground. On the first swing, when the Applicant was applying the cross travel, the majority of the hook appears to have come out of the coil, the hook then swings back into the coil. On the second swing, the hook comes fully out of the coil then swings fully back into the coil, so far in fact that the nose of the hook protrudes on the other side of the coil. The third swing replicates the second swing. On the fourth swing, the hook once again comes out of the coil. The Applicant then hoists the hook but the hook swings back into the core of the coil before the hook lifts and the coil tips over. It is obvious that the hook should not swing to that degree. I agree with Mr Meta that the swing of the hook was "huge". The opinion of Mr Fernandes, an experienced driver of crane 13, is that the swing of the hook was caused by the failure of the brake mechanism. Mr Meta testified that Despatch Operators are not specifically instructed on how to drive a crane and that sticky or tight brakes can result in the brakes either engaging or disengaging sharply rather then gradually. As a result of this evidence and opinion, I am satisfied that the huge swing of the hook on crane 13 was caused by the improper functioning of the crane rather than any action by the Applicant. I have taken this into account.
[72] I have previously found that the Respondent had a valid reason to terminate the Applicant employment.
[73] I have also found that the Respondent has complied with all of its obligations in relation to sections 387(b)-(g) of the Act.
[74] The final questions to be answered are whether the parties received a "fair go all round" and whether the Applicant's termination was harsh, unjust or unreasonable based on an assessment of issues identified in accordance with section 387(h) of the Act.
[75] The Applicant is 57 years old with little prospect of finding alternate employment having worked for the Respondent all of his adult life. The Applicant is the sole income earner in a household with his wife, three children and elderly father. The Applicant has financial debts of $600,000. I find that the termination of the Applicant will have a significant detrimental effect on the financial and personal circumstances of the Applicant with no evidence or likelihood of any improvement in his situation.
[76] The Applicant made a mistake. He hoisted the C-hook when it was insufficiently clear of the core of a thin, tall coil which had a high centre of gravity. The coil tipped. However, this chain of events was caused by the malfunction of the crane. The brakes were tight. The breaks on crane 13 had been complained about consistently for more than 6 months. The huge swing on the crane was caused by these faulty brakes. Based on the evidence of the Applicant, Mr Fernandes, Mr Knowles and my own observations during the inspection, I find that the crane does not respond to every direction given to it by the Operator. It cannot be fair or reasonable for a person who has spent 39 years working for the same employer to be terminated in such a scenario.
[77] I find that the action of the Applicant in tipping the coil was negligent. The Applicant should have waited for the hook to stop its metre swing or waited for the cross travel to re-engage and move further away from the coil before hoisting. However, the Applicant appears to be an impatient crane operator. He works faster than his fellow employees. He has been commended for his speed by his supervisor. There appears to be other coils to unload from the truck. Relevantly, the Respondent does not believe that the Applicant acted maliciously or with intent.
[78] If the Applicant had tipped the coil deliberately, or if there was a real, rather than hypothetically possible, issue in relation to safety or if the crane was operating perfectly and did not rely on the advanced skill of the operator to continuously manipulate the crane to get it to respond, than I would agree that the Applicant's record and actions would justify termination.
[80] The tipping of a coil where there was no damage to the coil or cost to the Respondent, in a situation which was did not provide an imminent risk of injury to another person whilst using a crane which was not operating properly, does not justify or warrant a future of personal and economic devastation to the Applicant. The penalty of termination was disproportionate to the act of tipping the coil.
[81] I find that the termination of the Applicant was harsh and unreasonable.
[82] Remedy
[83] The relevant provisions of the Act are:
When the FWC may order remedy for unfair dismissal
(1) Subject to subsection (3), the FWC may order a person's reinstatement, or the payment of compensation to a person, if:
(a) the FWC is satisfied that the person was protected from unfair dismissal (see Division 2) at the time of being dismissed; and
(b) the person has been unfairly dismissed (see Division 3).
(2) The FWC may make the order only if the person has made an application under section 394.
(3) The FWC must not order the payment of compensation to the person unless:
(a) the FWC is satisfied that reinstatement of the person is inappropriate; and
(b) the FWC considers an order for payment of compensation is appropriate in all the circumstances of the case."
(1) An order for a person's reinstatement must be an order that the person's employer at the time of the dismissal reinstate the person by:
(a) reappointing the person to the position in which the person was employed immediately before the dismissal; or
(b) appointing the person to another position on terms and conditions no less favourable than those on which the person was employed immediately before the dismissal.
(a) the position in which the person was employed immediately before the dismissal is no longer a position with the person's employer at the time of the dismissal; and
(b) that position, or an equivalent position, is a position with an associated entity of the employer;
the order under subsection (1) may be an order to the associated entity to:
(c) appoint the person to the position in which the person was employed immediately before the dismissal; or
(d) appoint the person to another position on terms and conditions no less favourable than those on which the person was employed immediately before the dismissal.
(2) If the FWC makes an order under subsection (1) and considers it appropriate to do so, the FWC may also make any order that the FWC considers appropriate to maintain the following:
(b) the period of the person's continuous service with the employer, or (if subsection (1A) applies) the associated entity.
(3) If the FWC makes an order under subsection (1) and considers it appropriate to do so, the FWC may also make any order that the FWC considers appropriate to cause the employer to pay to the person an amount for the remuneration lost, or likely to have been lost, by the person because of the dismissal.
(4) In determining an amount for the purposes of an order under subsection (3), the FWC must take into account:
(a) the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for reinstatement; and
(b) the amount of any remuneration reasonably likely to be so earned by the person during the period between the making of the order for reinstatement and the actual reinstatement.
(1) An order for the payment of compensation to a person must be an order that the person's employer at the time of the dismissal pay compensation to the person in lieu of reinstatement.
(2) In determining an amount for the purposes of an order under subsection (1), the FWC must take into account all the circumstances of the case including:
(a) the effect of the order on the viability of the employer's enterprise; and
(b) the length of the person's service with the employer; and
(c) the remuneration that the person would have received, or would have been likely to receive, if the person had not been dismissed; and
(d) the efforts of the person (if any) to mitigate the loss suffered by the person because of the dismissal; and
(e) the amount of any remuneration earned by the person from employment or other work during the period between the dismissal and the making of the order for compensation; and
(f) the amount of any income reasonably likely to be so earned by the person during the period between the making of the order for compensation and the actual compensation; and
(g) any other matter that the FWC considers relevant.
(3) If the FWC is satisfied that misconduct of a person contributed to the employer's decision to dismiss the person, the FWC must reduce the amount it would otherwise order under subsection (1) by an appropriate amount on account of the misconduct.
(4) The amount ordered by the FWC to be paid to a person under subsection (1) must not include a component by way of compensation for shock, distress or humiliation, or other analogous hurt, caused to the person by the manner of the person's dismissal.
(5) The amount ordered by the FWC to be paid to a person under subsection (1) must not exceed the lesser of:
(a) the amount worked out under subsection (6); and
(b) half the amount of the high income threshold immediately before the dismissal.
(6) The amount is the total of the following amounts:
(whichever is higher) for any period of employment with the employer during the 26 weeks immediately before the dismissal; and
(b) if the employee was on leave without pay or without full pay while so employed during any part of that period - the amount of remuneration taken to have been received by the employee for the period of leave in accordance with the regulations."
[84] In relation to remedy, the Applicant submitted that the Applicant should be reinstated to his old role or to a position with no less favourable terms and conditions, backpay for the time that he has been terminated and an order in relation to his continuity of service.
[85] The Respondent submitted that they had lost trust and confidence in the Applicant. Mr Meta testified that he was not satisfied that the Applicant had taken responsibility for the incident and that he has no confidence that the Applicant would, in the future, work in accordance with the necessary safety standards. Also, if the Applicant was reinstated then this decision would send a very damaging and negative message to the rest of the employees of the Respondent in relation to safety.
[86] Further, the Respondent submitted that the Applicant has made some ungenerous comments about the Respondent claiming that the Respondent's unscrupulous, aggressive and does not follow safety rules which would make the re-establishment of an employment relationship difficult. Having been involved with blue collar workers, in one form or another, since 1981, I find the disparaging comments made by the Applicant in respect of the Respondent to be anything but uncommon, especially after a long running dispute. If every employee who thought their boss was overpaid, not up to the job or didn't understand safety was to be dismissed then, from my personal experience, there would be an unlimited number of blue collar workers looking for new employment.
[87] In Perkins v Grace Worldwide (Aust) Pty Ltd, the Full Court of the Industrial Court said:
"Trust and confidence is a necessary ingredient in any employment relationship. ... So we accept that the question whether there has been a loss of trust and confidence is a relevant consideration in determining whether reinstatement is impracticable, provided that such loss of trust and confidence is soundly and rationally based.
At the same time, it must be recognised that, where an employer, or a senior officer of an employer, accuses an employee of wrongdoing justifying the summary termination of the employee's employment, the accuser will often be reluctant to shift from the view that such wrongdoing has occurred, irrespective of the Court's finding on that question in the resolution of an application under Di 3 of Pt VIA of the Act.
If the Court were to adopt a general attitude that such a reluctance destroyed the relationship of trust and confidence between employer and employee, and so made reinstatement impracticable, an employee who was terminated after an accusation of wrongdoing but later succeeded in an application under the Division would be denied access to the primary remedy provided by the legislation. Compensation, which is subject to a statutory limit, would be the only available remedy. Consequently, it is important that the Court carefully scrutinise any claim by an employer that reinstatement is impracticable because of a loss of confidence in the employee.
... It is rare for any human being to have total trust in another. What is important in the employment relationship is that there be sufficient trust to make the relationship viable and productive. Whether that standard is reached in any particular case must depend upon the circumstances of the particular case. And in assessing that question, it is appropriate to consider the rationality of any attitude taken by a party.
It may be difficult or embarrassing for an employer to be required to re-employ a person the employer believed to have been guilty of wrongdoing. The requirement may cause inconvenience to the employer. But if there is such a requirement, it will be because the employee's employment was earlier terminated without a valid reason or without extending procedural fairness to the employee. The problems will be of the employer's own making. If the employer is of even average fair-mindedness, they are likely to prove short-lived. Problems such as this do not necessarily indicate such a loss of confidence as to make the restoration of the employment relationship impracticable."[22]
[88] In Nguyen v Vietnamese Community in Australia t/a Vietnamese Community Ethnic School South Australia Chapter, a Full Bench of the Commission conveniently summarised this issue:
"The following propositions concerning the impact of a loss of trust and confidence on the question of whether reinstatement is appropriate may be distilled from the decided cases:
Ultimately, the question is whether there can be a sufficient level of trust and confidence restored to make the relationship viable and productive. In making this assessment, it is appropriate to consider the rationality of any attitude taken by a party."[23]
[89] I have taken into account the parties submission on remedy.
[90] The primary remedy for a successful unfair dismissal application is reinstatement. In this current case though, I am concerned that the Applicant has not taken ultimate responsibility for his actions. I do not believe that he could not see the coil swinging. If that were the case then he would have serious problems with his eyesight which have not been diagnosed by his optometrist. I have taken this into account.
[91] The problem with awarding the Applicant with a remedy of financial composition is that, based on the Applicant's age and the depressed employment market in the Illawarra, any benefit of financial compensation will be temporary if he is unable to find meaningful employment. I have taken this into account.
[92] I have taken into account that Mr Costello, the Applicant's immediate Supervisor, did not stand the Applicant down after the incident. The Applicant was returned to the workplace, although I acknowledge not into his normal crane driving role. If Mr Costello had lost trust and confidence in the Applicant then he would have been stood down immediately. I am satisfied that the requisite level of trust and competence can be re-established. The Applicant is an experienced crane driver. Two of his colleagues thought highly enough of him to come and testify on his behalf. As I have said previously, trust and confidence are operational requisites of an employment relationship. There is no evidence to suggest that Mr Costello cannot re-establish a good working relationship with the Applicant.
[93] I am in no doubt that the attitude of the Applicant needs to change. He needs to take more care in undertaking his role. Whilst I am hesitant in ordering reinstatement, ultimately, I am of the view that it is the only remedy which is appropriate.
[94] I hereby order that the Applicant be reinstated to his former position with the Respondent.
[95] The Applicant has requested that my order extend to the issues of backpay and continuity.
[96] In accordance with section 391(2) of the Act, I hereby order the Applicant's continuity of employment with the Respondent.
[97] I note that the Applicant received 5 weeks' pay upon termination. Based on the negligent action of the Applicant and his conduct in embellishing his recollection since the incident, I have decided to make no orders in relation to section 391(3) of the Act.
[98] I so Order.
Printed by authority of the Commonwealth Government Printer
Zaki Habak
BlueScope Steel Limited T/A BlueScope Steel Limited Springhill Works [2019] FWC 3332
(1995) 185 CLR 410
(1998) 84 FCR 483
(1998) 84 IR 1
(1995) 62 IR 371
(2000) 98 IR 137
(1995) 60 IR 1
(1997) 72 IR 186