Department of Justice

Tasmanian Industrial Commission

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

T12670

 

TASMANIAN INDUSTRIAL COMMISSION

Industrial Relations Act 1984
s70(1) appeal against decision

Classic Video Pty Ltd
trading as Video City

(T12670 of 2006)

and

Georgina Margaret Taylor

FULL BENCH:
PRESIDENT P.L. LEARY
COMMISSIONER T.J. ABEY
COMMISSIONER J.P. McALPINE

HOBART, 4 August 2006

Appeal against a decision handed down by Deputy President P.C. Shelley arising out of T12466 of 2005 - order revoked

REASONS FOR DECISION

[1] This is an appeal by Classic Video Pty Ltd, trading as Video City (the appellant), against a decision of Deputy President Shelley. In Matter T12466 of 2005 the Deputy President ordered that:

"Classic Video Pty Ltd trading as Video City pay to Georgina Margaret Taylor the sum of One Thousand Dollars and Seventy Two Cents by close of business on 18 May 2006."

[2] The order represented a payment of two weeks wages following the alleged termination of Georgina Taylor's employment by the appellant.

[3] The grounds of appeal were as follows:

The Deputy President made an error of fact as:

(i) the employee was employed as a probationer;

(ii) the employee was [not] dismissed.

The Deputy President made an error of interpretation of the Australian Workplace Agreement (AWA), Clause 31 - Contract of Employment clause.

[4] The appellant was requested, pursuant to s.71(2A), to provide "further and better particulars of the grounds of appeal."

[5] The following comprehensive correspondence was received in response to the request:

"I will refer to the AWA under which the employee was employed. In the document the employee was employed on the clear understanding her status was that of a probationary employee and subject to a probationary period of 12 weeks. After the expiration of 12 weeks, the employee will become eligible for permanent employment but the completion of the 12 week probationary period does not of itself confer any right to permanent employment.

This condition of employment was made known to the employee prior to her accepting a position with the Company when she had in her possession for a period of 5 days an AWA which she subsequently signed accepting this as a condition of her employment. I refer you to the Contract of employment specifically page 19 Clause 31 Contract of Employment.

The employee was not dismissed as a finding of the Commissioner. No evidence was offered by the employee to evidence such a finding.

The Commissioner drew bias in the proceedings when the Commissioner stated (PN 59) "now, you were dismissed back ......" when no evidence had been tendered suggesting such an action had been taken by the Company.

It is submitted the proceedings from that point in time became one surrounding the act of "dismissal" rather than what the written document (AWA) provided for and that is the Company's entitlement not to offer permanent employment to the employee before the completion of the probationary period.

In the employee opening statement to the Commission (PN 19) she stated Mr Ewing said to her (the employee):

"As you're aware your three month probation period ends as of tomorrow and I've decided not to offer you a position at this time".

Further the employee in her submission to seek a hearing stated she was employed as a probationer and employment was terminated "the day before my 3 mth probation period was up".

The AWA provides for a probationary period and completion of this period does not of itself confer any right to permanent employment and in fact an offer of permanent employment must be made by the employer to the employee. No such offer was made to the employee in this instance. (see Clause 31 of the AWA).

The employee would have been aware of the provision of probationary employment clause in the AWA. The employee signed the AWA following a period of time in which she had the opportunity to study and consider the terms of her employment.

Therefore, the employee was aware the offer of employment would be subject to the completion of a probationary period without the right of permanent employment during or at the completion of the probationary employment.

During the probationary period each party to the agreement has the right to terminate the employment without explanation and without reason and more importantly without repercussions to either party. This is spelt out in the AWA and was agreed between the parties.

It is further submitted the Commissioner failed to interpret the AWA in that the Commissioner read the Termination clause (for permanent employees) as if it was part of the Probationary clause. Yet the Commissioner acknowledged the employee was a probationer (PN 207). Moreover, the employee acknowledged she was a probationer when she replied to the Commissioner's question (PN207) with the answer "yes" (PN 208).

The Commissioner erred in suggesting the "respondent has no authority to offer anything by way of a settlement" (PN 218) in that the AWA provided for an agreed settlement; the settlement being termination of employment without explanation and without any repercussion.

It follows therefore a "to offer a settlement" was not open to the Commissioner to seek nor does it follow the Commissioner is required to make a "determination" (PN 220).

The Commissioner has further erred in that the probationary clause is not silent on the question of notice. Notice is not required in the probationary period and to suggest the normal termination clause applies to the probationary clause is to interpret the probationary clause as to include a notice period.

The probationary clause clearly expresses the right of either party, the employer or the employee, to terminate the employment contract during the probationary period without explanation and without any repercussions.

To conclude the termination was unfair is not open to such a finding in that during the probationary period, each party has the right to terminate the contractual relationship at their own discretion.

It is submitted the Commissioner failed to observe the written agreement made between the parties and ignored the view "agreement between the parties has some weight" (Finding (23).

It is submitted a written agreement has significant weight and should not be set aside simply because no formal warnings; no notice was given or the other reasons provided in the Commissioner's findings (Finding 25).

The probationary clause does not provide for those matters because it allows either party to terminate their contract of employment for that very reason - to terminate without explanation; without any repercussions. To infer because such matters as notice; warning etc is not provided for does not prima facie make the exercise of the clause unfair. It was agreed between the parties that this clause will govern the employment contract.

It is submitted furthermore, to suggest the probationary clause is silent on the issue of notice and then draws upon another clause to insert a notice period falls outside the expertise of the Commissioner.

It is further submitted a notice clause is not required during the probationary period as to infer such is to make the clause redundant as it provides for termination without notice."

[6] The employee Georgina Margaret Taylor (the respondent to the appeal) was employed under an AWA. A Filing Receipt dated 29 August 2005 from the Office of the Employment Advocate was provided which said (where relevant):

"This receipt confirms that the Australian workplace agreement between Classic Video Pty Ltd and GEORGIE TAYLOR was filed by the Employment Advocate today.

The Employment Advocate is now assessing the Australian workplace agreement to determine whether it meets the approval requirements. You will be contacted by an officer of the Office of the Employment Advocate (OEA) if further information is required.

Under the Workplace Relations Act 1996, an employer must give each employee who is party to the Australian workplace agreement a copy of this notice as soon as practical after receiving it."

[7] The parties agreed that the respondent was party to a properly registered document known as the Classic Video Pty Limited Australian Workplace Agreement 2004 (the AWA).

[8] The AWA, although individually signed, appears to have general application to all employees, provides:

"Duration:

New Employees

This AWA starts operating on the later of:

· The day after the filing receipt was issued;
· The day specified in the AWA as the starting day; or
· The day the employment commences.

Existing Employees

This AWA starts operating on the later of:

· The day after the date of the approval notice; or
· The day specified in the AWA.

This AWA expires after 3 years."

[9] The respondent signed her copy of the AWA on 22 August 2005, having been provided with a copy of the AWA on 19 August 2005. She was employed as a Full-time Library Attendant, a classification specified in the AWA.

[10] Under the definition of Full Time Employee the AWA states:

"Any person who is engaged on an ongoing basis to perform 38 hours ordinary work as prescribed in the Hours of Work clause. It is expressly noted and agreed that the words "full time employee" do not imply any undertakings or guarantees as to tenure or job security. The mutual notice period is two weeks as prescribed in the Contract of Employment clause."

[11] Clause 31 of the AWA - Contract of Employment - provides: (where relevant):

"Probationary Period:

The employee is initially engaged on the basis of a twelve weeks probationary period. During the probationary period the employer or the employee has the right to terminate the employment for any reason without explanation and without any repercussions. Wage entitlements will only be for the hours work. (sic) There is no annual leave or sick leave accrual or entitlements during this period.

The purpose of the probationary period is to enable the employee and the employer to ascertain their suitability and capability to work together. At the completion of the 12 week probationary period the employee will become eligible for permanent employment. The completion of the 12 week probationary does not confer the right of permanent employment. An offer of permanent employment must be made by the employer to the employee.

Employee access to entitlements to sick leave and annual leave shall commence from the date of appointment as a permanent employee. All sick leave and annual leave entitlements will accrue from the commencement day of employment."

[12] Clause 31 also provides:

"Termination of Employment

Employment may be brought to an end by the giving of two weeks notice by either party, or by the payment or forfeiture of two weeks as the case may be.

An employee who fails to provide two weeks notice of their intention to resign shall forfeit wages or entitlements already earned but not paid up to the equivalent amount."

[13] Clause 10 of the AWA - Agreement Prevails over Award - prescribes:

"This agreement replaces in its entirety the Miscellaneous Workers Award and any other Award or Agreements which otherwise may be held to apply to Classic Video Pty Limited."

[14] The Deputy President noted at paragraph 20 of her decision that:

"This hearing was unusual in that the respondent was represented by a young woman who had no instructions in relation to the proceedings, no experience in matters such as this, and who, through her own statements, had no direct knowledge of the events. No jurisdictional matters were raised as a bar to the Commission determining the matter."

[15] The appellant addressed all of the appeal grounds together. Basically his argument was that Ms Taylor had completed her period of probation and there was no offer of on going employment and, according to the terms of the AWA, there is no entitlement to any further payment.

[16] The respondent claimed that she had in fact been dismissed, as was stated by the Deputy President, and that the appellant seems to argue that he has the right to terminate her employment at any time without notice during the probationary period. It was conceded however that the AWA did allow termination during the probationary period without notice but that the issue before the Deputy President was the "manner in which the termination took place." [PN81]

[17] It was submitted that there was a denial of natural justice in terms of the termination and some reliance was placed on the Oxford dictionary meaning of "to terminate" which is "to bring or come to an end."

[18] We note that the period of probation did "come to an end" by application of the relevant clause in the AWA.

[19] On behalf of the respondent it was argued that the AWA states that "During the probationary period the employer or the employee has the right to terminate the employment for any reason without explanation and without any repercussions" and that the reference to repercussions means, according to the Oxford dictionary, that there should be no "indirect effect or reaction following an event or action, the recoil after impact or an echo or reverberation." Ms Butler, for the respondent, said that "...the immediate cessation of your employment with no financial compensation for that is a repercussion...."

[20] Further it was submitted that the termination clause is silent as to whether it applies to the probationary period of employment. Ms Butler submitted that the termination clause is silent as to its definition of employee however as the probationary period stated the intent that there were to be no repercussions it would follow that two weeks notice would be essential to satisfy that intent. She noted that the Deputy President had found that the termination was procedurally unfair. At paragraph 25 of the decision the Deputy President said:

"I find that the termination was procedurally unfair. There is insufficient evidence to make a determination as to whether or not the applicant's performance was so poor as to warrant the termination of her employment, but even if it were, the termination was procedurally unfair in that no formal warnings were issued, no notice was given, the applicant was not informed in advance of the reason for the meeting at which she was terminated, the decision to terminate was made in advance of the applicant being given the opportunity to put her case and she was not given the opportunity to be represented."

[21] Ms Butler relied on a decision of the Australian Industrial Relations Commission in E Clarkson v Vanda Holdings Pty Limited t/as Carol Fuels [Print R4279] where Commissioner Foggo has recorded some salient comments from the decision of Sheldon J in his decision J Loty and Holloway v Australian Workers Union [1971] AR (NSW) 95 which is the seminal decision in respect to 'a fair go all round' in termination of employment matters. That decision states:

"... I say 'unfairly' because adjectival tyranny should be resisted and I believe that in the modern context expressions used in the older cases such as 'harsh', 'oppressive' and 'unconscionable' as determinants as to whether intervention by an industrial authority is in its discretion permissible are properly interpreted on the basis simply of firstly deciding in all the circumstances, even though in the dismissal (be it summary or notice) the employer has not exceeded his common law and/or award rights, whether the employee has received less than a fair deal. Mr Commissioner Manuel in a recent case put it in a nutshell and in language readily understood in the industrial world when he conceived his duty to be to ensure 'a fair go all round'. In my view, the use of the old adjectives, with their overtones from other jurisdictions, tends to distort this basically simple approach in that they can be strained to mean that an employer can be less than fair in exercising this right to dismiss and yet stand outside the permissible area within which an industrial authority in its discretion may act. It is a question of emphasis rather than substance as these adjectives have frequently been used in conjunction with and as alternatives to such expressions as 'unfair', 'unjust' and 'unfair dealing'. The last expression was used as an alternative to 'injustice' and 'oppression' as far back as 1921 in the historic Bank Officers Case, and it is inconceivable that a more rigid test should be applied half a century later. The less fetters there are on the discretion the better (none appear in the Act) but it is all-important that it should be exercised soundly. The objective in these cases is always industrial justice and to this end weight must be given in varying degrees according to the requirements of each case to the importance but not the inviolability of the right of the employer to manage his business, the nature and quality of the work in question, the circumstances surrounding the dismissal and the likely practical outcome if an order of reinstatement is made. There certainly may be cases where the dismissal had many elements of unfairness but an industrial authority if it was convinced of the practical uselessness of trying to re-establish the employer-employee relationship, would not intervene at all. There may be other cases where there are reasonable prospects for the future of the relationship if clarifying conditions are imposed."

Findings:

[22] The respondent, Ms Taylor, was not dismissed by the appellant. We are not sure that the Deputy President found that Ms Taylor was dismissed however she did find that the employment was terminated unfairly. We agree that the manner in which the termination was effected was unfair albeit such process is allowed under the terms of the AWA.

[23] Ms Taylor was on a period of probation, the terms of which are clearly stipulated in the AWA and the probationary period clause includes within its terms a process for termination by either party. The period of probation had come to an end with no offer of further employment being made to Ms Taylor.

[24] The Termination of Employment subclause has no application to an employee on a period of probation.

[25] The Deputy President did not definitively find that the Termination of Employment subclause had application to Ms Taylor, although such a conclusion might be inferred. We find that, to the extent that this inference was drawn and influenced the remedy subsequently ordered, the Deputy President fell into error.

[26] Ms Taylor had completed her 12 weeks probation and the AWA does not confer any right of on going employment, as such there could be no expectation that the employment would continue unless this had been indicated by the appellant. There was no evidence to suggest this was the case.

[27] The Deputy President was at a disadvantage by the employer being represented by a person who was not familiar with the issue, was not familiar with the procedures in the Commission and had no instructions and no authority to attempt to reach a settlement. This could be seen as disrespectful of the Commission and its processes.

[28] The Commission encourages the application of procedural fairness and commonly accepted effective human relations management. It seems to us that had Ms Taylor been informed at an earlier date that her employment would not continue beyond her period of probation; and further if there were any genuine performance issues they should have been raised prior to her being informed that there would be no offer of on going employment. By providing such information to Ms Taylor in a timely fashion she would have been aware of her circumstances and been able to make an informed decision as to her future. Such a process if properly followed would be unlikely to draw the sort of criticism made by the Deputy President and with which we agree.

[29] Prima facie it would seem to us unlikely that the AWA signed by Ms Taylor would have passed the no disadvantage test required by the Workplace Relations Act, 1996, at Part VIE, Section 170XA(1) and (2).

[30] The decision of the Deputy President is revoked.

 

P.L. Leary
PRESIDENT

Appearances:
Mr T Ewing for Classic Video Pty Ltd, trading as Video City.
Ms D. Butler from Launceston Community Legal Centre for Ms Taylor.

Date and Place of Hearing:
2006
16 June
Hobart