T9219
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TASMANIAN INDUSTRIAL COMMISSION Industrial Relations Act 1984 Patricia Gaye Cox and Netcraft Pty Ltd
Industrial dispute - alleged unfair termination - valid reason for termination - procedurally unfair in that applicant was not given some opportunity to change behaviour as was afforded to other staff - reinstatement impractical - compensation ordered REASONS FOR DECISION On 29 September 2000 Patricia Gaye Cox (the applicant) applied to the President, pursuant to Section 29(1A) of the Industrial Relations Act 1984, for a hearing before a Commissioner in respect of an industrial dispute with Netcraft Pty Ltd (the employer) arising out of the alleged unfair termination of her employment. This application was first listed for hearing on 1 November 2000. Ms K O'Donnell, a solicitor, sought and was granted leave to appear for the applicant. Mr J O'Neill of the Tasmanian Chamber of Commerce and Industry Limited (TCCI) appeared for the employer, together with Mr S Shield and Mr B Stafford. Following a short adjournment, the Commission was advised that the parties had not been able to resolve the matter and that a hearing of the application would be necessary. Following a series of adjournments and deferrals at the request of the applicant, the substantive hearing commenced on 10 January 2001. Mrs Cox had been an employee of Netcraft since 1987. Initially she was employed as a net maker and subsequently moved into the office as a sales representative. She described her employment status as a full-time casual. On 1 September 2000 Mrs Cox was handed a letter1 which had the effect of standing her down with pay pending an investigation into a number of allegations. A fellow employee, Mr Farrow, was similarly stood down. The letter was expressed in the following terms:
On 4 September the General Manager, Ms Sandra Phythian met with all staff together with a union official. All employees were given a memorandum2 which Ms Phythian read and explained. In short, this memorandum covered in some detail a number of issues relating to workplace behaviour and company policies. This included policies in respect of pornographic material, swearing and offensive language, sexual harassment, respect for other employees and supervisors, and confidential information. Mrs Cox responded to the allegations in writing3 and there was subsequent correspondence between her legal representative and the employer.4 During this period management conducted an investigation into the allegations. In large measure this consisted of interviewing all other staff and requesting them to complete a set questionnaire going to the workplace behaviour of Mrs Cox. By letter dated 20 September Mrs Cox's lawyer was advised that the employment of Mrs Cox was to be terminated forthwith. The letter was expressed as follows:5
Ms O'Donnell contended that the workplace had been either ineffectually managed or without management for a long period of time and that staff had no direction. As a consequence work practices had developed which are not generally acceptable in today's workplace. Ms O'Donnell said:6
In relation to Mrs Cox, Ms O'Donnell submitted that7 "... her dismissal was harsh, unjust and unreasonable and done without recourse to the principles of natural justice when taking the workplace as a whole into account". During the hearing the following witnesses gave evidence:
The Workplace Culture During the hearing a considerable amount of evidence was directed towards the "workplace culture" prevailing at Netcraft. Prior to the appointment of Ms Phythian as General Manager on 10 July 2000, there had been a six month's gap without any manager in place. It was common ground that Mrs Cox and Mr Farrow were the two most senior staff at the factory during this period. There was however some debate as to their status. Whilst neither had been specifically appointed as managers or paid additional money, it is clear both had a pivotal role in the day-to-day running of the business and that this was the expectation of the directors, Mr Shield and Mr Stafford. It is very clear that during this period between managers, and indeed probably under the previous General Manager, the workplace behaviour was quite at odds with what might be considered to be appropriate by contemporary standards. Certainly swearing and offensive language was rife throughout the workplace. There was some evidence of behaviour which could be described as sexually provocative, albeit largely in the nature of pranks or larrikinism. It was common ground that no policies were in place in respect of harassment, including sexual harassment. The evidence of Mrs Cox, largely unchallenged, was that there had been no occupational health and safety training. Both Mr Shield and Mr Stafford gave evidence in relation to a meeting on 25 May 1999. Mr Stafford described the meeting in the following terms.8
And later:
Mrs Cox could recall the May 1999 meeting but was vague about the content.9
Miss Ford had no recollection of the May 1999 meeting. I have no doubt that Mr Shield did speak to the staff on the issue of how staff should relate to each other. Nonetheless it clearly did not make an impression. I suspect this is symptomatic of the workplace culture prevailing at the time. That is, the endemic bad language was not seen by the staff as being either wrong or unacceptable. It is noteworthy that the following comment is contained in the 4 September memorandum to all staff:10
Ms O'Donnell summarised the position in the following terms:11
Specific Allegations The specific allegations against Mrs Cox were identified in the memorandum of 1 September.12 In large measure these allegations arose from a complaint lodged by Ms Pittock. These allegations were refined in subsequent correspondence between Mrs Cox's representative and Netcraft. As a consequence the allegation relating to the divulgence of confidential information was withdrawn. During the hearing it became apparent that the allegation concerning directing staff to carry out personal errands was based on a mistaken understanding of the factual position. I have as a consequence disregarded this allegation. Some evidence was led which I suspect was aimed at supporting the allegation relating to a disregard of company procedures. However I found this to be somewhat vague and inconclusive and certainly fell short of constituting serious misconduct. A further matter was raised by the Company concerning a transaction for which management alleges payment was not accounted for. Apparently this issue arose subsequent to the dismissal. Whilst this allegation is potentially serious, the evidence before me was quite incomplete. It would therefore be improper for me to form a view one way or the other. I have therefore disregarded this allegation for the purposes of this decision. During the hearing evidence was led as to the alleged misuse of the company e-mail system. This issue was not raised in the 1 September memorandum nor apparently in the subsequent investigation. The substance of this allegation was that Mrs Cox both received and sent e-mails of a quasi pornographic nature on the Netcraft computer system.13 Mrs Cox did not deny this allegation and added that the previous General Manager was an active participant in the transmission of such e-mails.14 Miss Ford gave evidence that she had also engaged in this activity but had never been told not to do so.15 Mr Shield acknowledged that the issue of pornographic material had not been addressed because it had not been raised with the directors. It is well established that it is open, indeed appropriate, for an employer to have a clear policy on the use of e-mail. In this case the issue was specifically addressed in the 4 September memorandum to all staff. The memorandum stated: 16
Had that policy been in place prior to the suspension of Mrs Cox on 1 September, then the activity referred to above would almost certainly have constituted misconduct. However Mrs Cox categorically denied that she had ever been spoken to by either management or the directors about any of the issues raised in the memorandum, prior to her suspension. I am quite satisfied that, prior to 4 September 2000, there was no policy in place as to the appropriate use of e-mail. In these circumstances, particularly when coupled with the evidence relating to the involvement of the previous General Manager, I am unable to conclude that Mrs Cox's use of the Netcraft e-mail system in the manner described, constituted serious misconduct. This leaves us with allegations grouped under the following broad statements taken from the suspension memorandum.
In relation to these issues, the evidence of Ms Pittock is pivotal. Ms Pittock commenced in the administration section of Netcraft on Monday 28 August. At the time she was employed by an employment agency although she subsequently became a direct employee of Netcraft. The first week was designed to be a change-over period consequent upon the resignation of a Ms Julie Marshall. Both Ms Pittock and Mrs Cox worked in close proximity in the office area. In relation to her first day of employment, the evidence of Ms Pittock was as follows:17
In response to a question relating to the abuse of staff members by Mrs Cox, Ms Pittock said:18
Ms Pittock said that during the day she telephoned the agency and told them that she did not want to return to Netcraft. During cross-examination Ms Pittock agreed that her initial complaint to the agency concerned the behaviour of an individual employee who was not Mrs Cox. The complaint about Mrs Cox arose from subsequent questioning.19 On the question of what Ms Pittock wanted done, the following exchange took place.20
Mrs Cox denied that she ever swore at Ms Pittock but agreed that she did swear in her presence. She also said that Ms Pittock had not given any indication that she was offended by the behaviour in the workplace.21 On the question of "badmouthing" the directors, Mrs Cox's evidence was:22
On the issues of prior warnings and company policies, the following exchange took place:23
That there was a significant problem at Netcraft was readily acknowledged by the directors. Mr Shield said:24
On this issue Mr Stafford said:25
And later:26
Procedural Fairness The catalyst for this dismissal was the telephone call from Ms Pittock to the agency during her first day of employment. For some unexplained reason this complaint, as serious as it was, was not passed on to Netcraft management until an apparently chance meeting four days later. On receipt of this complaint Ms Phythian acted immediately. She interviewed Ms Pittock that same day and arranged a meeting of the directors for the next morning. The directors sought professional advice and then prepared a written statement of the allegations expressed in the broad. Mrs Cox was stood down with pay pending an investigation into the allegations. Mrs Cox was invited to respond either verbally or in writing. She chose the latter. Subsequently her legal representative became involved and detailed correspondence was exchanged. The concurrent investigation consisted largely of an identical questionnaire given to all staff to be completed on a voluntary basis. Ms O'Donnell submitted that whilst she did not take issue with the manner of the investigation, natural justice had nonetheless been denied. Ms O'Donnell's contention on this point is well summarised in her closing submission:27
Finding The behaviour of Mrs Cox, as judged by contemporary workplace standards, was unacceptable. Had it occurred in a post 4 September environment, that is, after the general and specific warning given to all staff, I would have no hesitation in finding that the behaviour amounted to serious misconduct which would justify summary dismissal. The circumstances surrounding this case however demand a special consideration. The evidence relating to the prevailing workplace culture at Netcraft prior to 4 September 2000 is unassailable. It is equally clear that the workplace has changed dramatically for the better following the decisive actions of management and the directors when the reality of the position became known to them. The question for this Commission is whether the summary termination of Mrs Cox was, in all the circumstances, fair. Mrs Cox was an employee of long standing. The largely unchallenged evidence is that she had never been warned or told that her behaviour was unacceptable. It is also clear that, prior to 4 September, the company did not have any policies in place relating to the behaviour complained of. The absence of specific policies is not of course a licence for workplace behaviour to be at large or that anything goes. The absence of such policies will, however, inevitably lower the bar on the fine line between acceptable and unacceptable behaviour. I should also indicate that in instances whereby serious misconduct is involved, prior warnings are not normally a prerequisite, but again, this must be viewed against the circumstances of this particular case. In this context the preamble to the 4 September memorandum is revealing. It states, inter alia:28
The memorandum then goes on to identify pornographic material, swearing and bad language and sexual harassment issues, amongst others. Mrs Cox unquestionably swore and used abusive language on a routine basis. There was however no evidence that Mrs Cox actually directed abuse at Ms Pittock. Similarly there was no evidence that other staff were offended by Mrs Cox's behaviour. Ms Pittock clearly was offended but she did not make that known to Mrs Cox. It is also clear that Mrs Cox was not the primary target of Ms Pittock's initial complaint. In my view the most serious aspect of Mrs Cox's behaviour was the quite derogatory and disrespectful manner in which she spoke of the General Manager and directors in their absence. Yet, on the available evidence, this appeared to be a widespread practice amongst the staff. This leads me to the question of whether the behaviour of Mrs Cox was any worse than that applicable to the workforce generally? On the evidence available, I am unable to conclude that it was. On the evidence of Mr Shield and Mr Stafford, Mrs Cox was, together with Mr Farrow, seen as a "ringleader", with the ability to exert considerable influence on the workforce generally. Whilst there was no actual evidence to support this contention, I am certainly prepared to accept that it was reasonable for the directors to hold this view. Nonetheless, on any reasonable assessment, Mrs Cox, whilst being a senior member of staff, was not a manager. I therefore conclude that it is the actual behaviour of Mrs Cox which is critical, rather than the degree of influence she may have had through dint of personality or otherwise. The behaviour of Mrs Cox was both reprehensible and unacceptable. However the same could probably be said for the majority of the staff at the time. All other staff members [with the exception of Mr Farrow] were told in unambiguous terms what the rules were and given the opportunity to change their behaviour. Mrs Cox was not given that opportunity. To that extent I am prepared to accept the submission of Ms O'Donnell that Mrs Cox was unfairly treated. I find that the employer did have a valid reason for the termination. However I find that there was a significant element of procedural unfairness in the fact that she was not given the same opportunity to modify her behaviour that was afforded the other staff. It is common ground that reinstatement is not a practical option given the effluxion of time and the adversarial nature of the proceedings. I am therefore prepared to award compensation. It would however be wrong to conclude that Mrs Cox is blameless and as a consequence the award of compensation will be modest. ORDER Pursuant to Section 31[1B] of the Industrial Relations Act 1984 I hereby order that Netcraft Pty Ltd, Bundalla Road, Margate pay to Mrs Patricia Gaye Cox, 23 Singapore Street, Midway Point an amount of $2800, such payment to be made within 21 days of the date of this decision.
Tim Abey Appearances: Date and Place of Hearing: 1 Exhibit A1 |