Department of Justice

Tasmanian Industrial Commission

www.tas.gov.au
Contact  |  Accessibility  |  Disclaimer

T7996

 

TASMANIAN INDUSTRIAL COMMISSION

Industrial Relations Act 1984
s.29 application for a hearing in respect of an industrial dispute

Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union
(T7996 of 1998)

and

Advanced Hearing Laboratories Pty Ltd

 

DEPUTY PRESIDENT J G KING

Hobart, 9 April 1999

Industrial dispute - re termination of an employee, Steven John Hooper - alleged unfair dismissal not sustained - application dismissed.

REASONS FOR DECISION

On 25 January 1999 I issued a decision in this matter which did not determine the issues between the parties and allowed the applicant to seek a further hearing to produce more evidence. The applicant accepted the opportunity and the matter was re-listed on 24 February 1999. The further evidence at my suggestion came from the applicant's witness Mrs R Harvey and one of the Directors of Advanced Hearing Laboratories Pty Ltd Mrs S Grenness.

The General background to this matter and the issues are detailed in my earlier decision and therefore will not be repeated. With the benefit of the further evidence and supporting submissions I now determine this application.

To put this decision in context I repeat the following from my decision of 25 January 1999 -

"My inclination in this matter based on all the evidence before me, the critical aspects of which I have detailed earlier, is to dismiss this application however, there is sufficient doubt in my mind to leave the door open for Mr Baker to have the matter re-listed for further brief hearing to see if some of the gaps in the evidence can be filled and therefore allow me to reach a final conclusion."

and

"Any further evidence in this matter would go to whether a meeting occurred as claimed and whether the approval for increased prices was given."1

This further evidence was also not conclusive but it did enable me to conclude that the most likely date of any discussions on the approval of a warranty figure in the pricing structure for laboratory produced hearing aids was 28 May 1998. The evidence of Mrs Harvey on 24 February 1999 in response to questions from me was:-

"You've indicated you believe it was 28 May, you can't be certain though?...

Not absolutely certain but I can see that Susan was away in Sydney on the 21st and the two in June - I was away once, they were away.

You were away on Thursday, 4 June - is that correct?... That's right. And they were away on 11 June.

They, being Mr and Mrs Grenness were away on 11 June?... That's correct. So it would have to be either 14 May or 28 May, and because I think - I'm pretty sure it was towards the end of May, so that's why I'm going with the 28th." 2

Mrs Grenness in being asked similar questions about the date of a meeting when warranty costs were discussed indicated "that would have been on 28 May"3

It is now necessary for me to decide what was discussed and what was approved on that day.

Again Mrs Harvey was clear on what she heard at the meeting on 28 May 1998. Her responses to questions on the detail were:-

"Can you just describe to me again what occurred when Mrs Grenness gave the okay to increase those charges?... Right. Well, Steven said, I'll put the prices of the aids up then? And she just said, yes.

Had there been detailed discussion before that or not?... Yes, we'd talked about it beforehand, or actually I wasn't actually involved in that discussion but the discussion was between Susan and Steven and they talked about it at length and in the end that was the final comment. He said he'd put the aids up and she said, yes.

And I know the question has been asked before but you're very clear on that discussion?... Definitely.

That it did occur and that's what was said?... It definitely did.

If I suggested to you that you are recounting what occurred in the way that you have in an effort to support Mr Hooper, what would you say?... No. I'd have to say that this is the truth. I was at the meeting and I heard what I heard." 4

However, while the evidence of the Employee and Mrs Harvey is consistent on what they believe was approved by Mrs Grenness on 28 May 1998, Mrs Grenness described what she approved in relation to warranty figures as "it was to be itemised as part of the cost but it wasn't an additional cost."..."it would not have had the effect of putting up the prices. We were talking about having a separate warranty pool itemised so that we could have down the track contingency funds for any work that was done under warranty. This was not done in such a way that it would have affected the retail price of the aid. It was a purely internal housekeeping arrangement" 5

There were other inconsistencies in the evidence going to the meeting of 28 May 1998. For example Mrs Grenness indicates that her husband the other director of the Company was present during the discussion on the warranty charges. The evidence of the Employee and Mrs Harvey was that the discussion was late in the meeting and that Mr Grenness had either not been at the meeting at all on that day or he had left before the discussion on warranty commenced.

Mr Grenness gave evidence that his wife did not give approval for the inclusion of a warranty figure in the Laboratory costs which would have the effect of increasing the retail costs of hearing aids at any staff meeting at which he was present. He indicated he was present at the meeting of 28 May 1998 which is consistent with the evidence of Mrs Grenness. Evidence from Mr Grenness tends to suggest that there was no discussion at all on warranty on 28 May 1998 however, this is not conclusive because of the questions asked of him and his perhaps specific responses. Sufficient to note again that there are significant discrepancies in the evidence of the Employee and Mrs Harvey on the one hand and that of Mr & Mrs Grenness on the other.

In an effort to reach a conclusion about what happened on 28 May 1998 I go to some of the exhibits presented in this matter. The first of those is Exhibit 0.2 which details a price list dated 6 February 1998. It was not disputed that this price list was used by the laboratory from February 1998 until at least May 1998. It contains a retail charge for hearing aids and appliances but makes no reference to a warranty figure. Exhibit O.1 is a price list dated 15 June 1998 and in addition to a column for retail charge also contains a column headed "warranty provided" however this column appears before the retail charge and where comparisons can be made demonstrates quite clearly that the inclusion of a warranty figure has had no effect on the "retail charge" it remains the same.

The evidence was not disputed that that document6 was produced by the Employee and the evidence of Mrs Grenness is that it reflects the outcome of the meeting and discussions on 28 May 1998 regarding warranty amounts. Her evidence on this matter on 24 February 1999 reads:-

"Deputy President

Just to go over what has been said today; you believe that at a meeting on 28 May you did give approval to include a warranty figure but it's on the basis that you describe rather than having the effect of increasing the cost of laboratory items?...Thats correct.

You have no doubt about that?...Absolutely no doubt.

Would you consider it possible that either Mr Hooper or Mrs Harvey or both might have had a misunderstanding about that?... No, because Steven drew up a price list in mid June which clearly shows he understood the basis that the warranty was supposed to be documented. The retail price did not go up."7

A further exhibit 0.7 the same price list as detailed in exhibit 0.1 records some hand written alterations to exhibit 0.1 those alterations increase some "retail charge" figures. Mr Hooper indicated in his evidence that he had altered a price list and added a warranty figure to the "retail charge" column consistent with the approval given to him by Mrs Grenness at the meeting of 28 May 1998. Unfortunately exhibit 0.7 was not produced during the time the Employee was in the witness stand however, I rely on some of his evidence and Mr Bakers comments on record8 to conclude that exhibit 0.7 is in fact a copy of the 15 June 1998 price list9 subsequently altered by the Employee to increase the "retail charge" column for some hearing aids by adding a warranty cost.

There was no evidence to suggest that that altered price list had been updated by computer but it is clear it was subsequently used by the Employee and maybe other staff to record Laboratory costs for the production of at least some hearing aids.

This evidence while not conclusive gives me an indication of what in fact was discussed and ultimately approved from the staff meeting of 28 May 1998. I will come back to my conclusions later.

Another indicator of what was approved on 28 May 1998 in relation to warranty is the evidence of Mr & Mrs Grenness of what occurred on 21 September 1998 when the Employee was interviewed and subsequently dismissed. Mrs Grenness's evidence going to this matter as it was discussed on 21 September 1998, reads:-

"Mr O'Neill X.N.

And at the meeting on the 21st which we heard in primary evidence, was at about a bit after twelve thirty?... Yes.

And that he put to Mr Hooper the question of the June prices and the fact that the evidence was there - that they had been altered or tampered with. What did Mr Hooper state in response to that allegation?... He admitted to doing it.

He admitted to doing it?... He admitted to doing it. He did not say that somebody else had done it. He did not claim that the junior had done. I mean he admitted to doing it which -

Did he say that Mrs Harvey could have possibly done it?... No , he didn't10

and

Deputy President

He didn't make that statement in the - sorry - he didn't make the comments about the increase in prices on the basis that you had approved them?... No. No. He did not."11

Mr Grenniss gave the same responses when asked similar questions in cross examination by Mr Baker.12

These were independent responses without Mr Grenness having the benefit of hearing his wife's evidence.

If the Employee believed that he had the approval of a Director to increase the "retail charge" for hearing aids produced by the laboratory why wasn't that used as his defence/justification at the interview on 21 September 1998. Although the matter was not pursued by Mr Baker in his cross examination of Mr Grenness, Mr Grenness's responses to the questions asked gave me a clear indication that if the Employee had raised the issue of a meeting at which approval was given to increase the charges at the termination discussion he would have required further information from the Employee ie. "I mean if that comment had been made my first question is, well when was it?"13

In arriving at a conclusion in this matter I am confronted with a situation where I have the Employee and Mrs Harvey giving evidence that at a meeting on 28 May Mrs Grenness gave approval to increase the "retail charge" for the production of hearing aids by the laboratory, Mrs Grenness's evidence was that she approved the inclusion of a warranty figure in the costing for the production of hearing aids but it was not to increase the "retail charge."

I have put retail charge in inverted comas because as with so much of the evidence in this matter it has not been clear what it means. As I understood the evidence exhibits 0.1 and 0.2 were documents detailing laboratory items and costings, the final column headed "retail charge" was in fact not a retail figure at all but a cost amount for their production. The retail price of the item was then determined based on other appropriate factors ie. overheads, profit etc. Why the laboratory would use an internal document with the wording "retail charge" on its costing column is not clear to me.

In spite of the above and my observation about inconclusive evidence in relation to many matters in this case I believe on the balance of probabilities from the evidence that the Employee did increase the cost of hearing aids by adding a warranty charge to the then existing laboratory cost of hearing aids without approval from a Director or Directors. These increases are reflected in the hand written alterations on exhibit 0.7.

I have indicated in my earlier decision that I believe Mrs Harvey to be a "a generally good witness who was credible in terms of her evidence going to the meeting and the approval," 14 I believe therefore I should detail my reasons for going against her evidence that supported the Employee in relation to the "approval" at the staff meeting of 28 May 1998.

As detailed previously Mrs Grenness gave evidence that she approved the inclusion of a warranty figure in the laboratory costing. This evidence is supported by the fact that the Employee then produced a document Ex 0.1 which reflects the approval given. If as he alleges Mrs Grenness gave approval to add the warranty figure to the "retail charge" why is that not reflected in Ex 0.1. The additions are in his hand writing on a copy of that document.15 The Employee then used that amended document to price hearing aids produced in the laboratory from about that time ie. June 1998. Why this was done and for what purpose only the Employee knows.

The evidence of Mr Grenness quoted earlier16 indicates that discussion of a pricing structure including a warranty figure took place at the 18 June 1998 staff meeting. That is consistent with the Employee's production of Ex 0.1 which is dated 15 June 1998 and which Mr Grenness indicates was discussed on 18 June 1998. The clear evidence of both Mr & Mrs Grenness is that no approval to increase laboratory prices was given at the 18 June 1998 meeting. If it had been given earlier as claimed by the Employee, why wasn't it reflected in Ex 0.1 and/or raised and discussed at the 18 June 1998 meeting?

My conclusions from all of the above are as indicated earlier that the Employee was not given approval to increase the laboratory "retail charge" costs.

I therefore believe that the Employee increased the price of laboratory items without authority for reasons only known to himself but given the history of his employment and the evidence in this case it would not be unreasonable to conclude that he did so for his own potential personal gain.

However, having concluded that the Employee did not have approval to increase laboratory costs and considering the seriousness of his actions I make the observation that I have problems with the evidence of Mrs Grenness earlier quoted.17 It is inconceivable to me, that having regard for the circumstances in this matter Mrs Grenness would give evidence to the effect that the Employee would believe his actions would not be discovered. She was managing the Employee's day to day work load she was very concerned about the performance of the laboratory and monitoring it clearly and she had the benefit of documents such as exhibit B6. Exhibit B6 clearly shows the unit cost of each hearing aid and reflects the change in price between May and June 1998. If the attachments to exhibit B6 were not provided to Mrs Grenness at the end of June 1998 this was not pointed out to me.

I think it also appropriate to observe that there was significant irrelevant evidence presented by both sides in this matter and much of the overall evidence was unhelpful and in some cases evasive.

Mr Baker argued on the 24 February 1999 that if I found that the Employee had not been unfairly dismissed I should conclude that the time taken to terminate the Employee amounted to a condoning of his actions and therefore the Employer has abrogated the right to dismiss the Employee.

I do not accept this submission as there are a number of reasons which would give grounds to the Employer to justify at least a significant part of the period of delay from June until September 1998. Those grounds are time to properly investigate concerns about the Employee and the Employees sick and annual leave, not insignificant periods, during August and September 1998.

The issues were broached with the Employee on his return to work on 21 September 1998,

In spite of my misgivings about many aspects of this case the available evidence leads me to conclude that the Employee was not unfairly dismissed.

Having regard for the above and in accordance with Section 31(1) of the Industrial Relations Act 1984 I dismiss this application and order accordingly.

 

J G King
DEPUTY PRESIDENT

Appearances:
Mr P Baker of the Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union with Mr S Hooper.
Mr J O'Neill of Tasmanian Chamber of Commerce and Industry Limited with Mrs S Grenness and Mr M Grenness for Advanced Hearing Laboratories Pty Ltd.

Date and place of hearing:
1998
October 13, 19
December 3
1999
February 24
Hobart

1 Decision T7996 of 1998 page 9
2 Transcript page 172
3 Transcript page 183
4 Transcript page 172
5 Transcript page 182/183
6 Ex 0.1
7 Transcript page 184
8 Transcript page 156
9 Ex 0.1
10 Transcript page 94
11 Transcript page 95
12 Transcript page 154
13 Transcript 154
14 Decision 25 January 1999 page 8
15 Ex 0.7
16 Decision 25 January 1999 Page 7
17 Decision 25 January 1999 Page 2