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T7402

 

TASMANIAN INDUSTRIAL COMMISSION

Industrial Relations Act 1984
s70 appeal against decision

Tasmanian Chamber of Commerce and Industry Limited
for and on behalf of
Classic Video Pty Ltd trading as Video City

(T7402 of 1997)

and

Timothy Richard Smith

 

FULL BENCH:
PRESIDENT F D WESTWOOD
DEPUTY PRESIDENT B R JOHNSON
DEPUTY PRESIDENT J G KING (Dissenting)

HOBART, 11 September 1998

Appeal - decision by Commissioner R J Watling on 19 November 1997 in matter T7008 of 1997 - decision and order confirmed - appeal dismissed

REASONS FOR DECISION

WESTWOOD P AND JOHNSON DP

Introduction

Matter T7008 of 1997 concerned an application by Mr T R Smith regarding the termination of his employment on 20 May 1997 by Video City.1 Commissioner Watling heard the matter and, by decision dated 17 October 1997, determined that Video City's dismissal of Mr Smith was unfair. The Commissioner then adjourned the matter, with directions that the parties let him have further submissions about the question of remedy.

After hearing those additional submissions the Commissioner, in a decision dated 19 November 1997, found that reinstatement was impractical. He then went on to consider the question of compensation and subsequently ordered Video City to pay to Mr Smith the sum of $3642.80. The Commissioner's Reasons for Further Decision show he arrived at that amount by way of the following calculation:2

"On balance, I appraise adequate compensation, in accordance with Article 10 of the ILO, to be 20 weeks' wages based on 38-hour week at ordinary time rate of pay, ie $388.74 per week, totalling $7774.80.

From this, an amount of $4132.00 is to be subtracted, being monies received by the applicant:

(a) whilst undertaking casual employment; and

(b) as unemployment benefits."

The matter now before the Commission concerns an appeal by Video City against the Commissioner's order. The appeal is made pursuant to Section 70(1) of the Industrial Relations Act 1984.

Appearances

When the appeal came on for hearing on Monday 16 February 1998 Mr S J Gates of the Tasmanian Chamber of Commerce and Industry Limited appeared for and on behalf of Video City with Mr T Ewing. Mr D Holden appeared for Mr Smith.

Grounds of Appeal

Appeal Ground No. 1

"The Commissioner erred in that he did not disclose the factors which led to the calculation of the 20 weeks compensation."

The Appellant's Case

Mr Gates submitted that Commissioner Watling's Reasons for Further Decision do not disclose the factors which led him to conclude that the level of compensation should be the equivalent of 20 weeks' pay. In his order the Commissioner refers to "on balance" and "I appraise" but he does not say what he balanced or what he appraised. In the circumstances, Mr Gates went on, because it is not possible to determine how he reached his conclusion as to compensation, especially having regard to the facts presented in his decision, the outcome is unreasonable and unfair. Accordingly, Mr Gates said, it is open to us to infer that the Commissioner failed to properly exercise his discretion.

Mr Gates acknowledged that Commissioner Watling discussed the question of compensation in the context of Nicolson v Heaven & Earth Gallery Pty Ltd (1994) 126 ALR 233, ie "what would have been likely to occur if the unfair dismissal of the applicant had not taken place".3 In the course of that discussion, Mr Gates said, the Commissioner referred to the evidence before him regarding, as to the applicant, the possibility of employment ending because of a lawful dismissal, the absence of any history of unsatisfactory work performance, the unlikelihood of long term career prospects, an unresolved conflict with a Regional Manager and the possibility of residing outside Tasmania.4

However, Mr Gates submitted, Commissioner Watling offered no conclusion as to the meaning of that evidence, nor did he say which evidentiary factor or factors led him to his assessment that the appropriate measure of compensation was "20 weeks' wages". It is clear that Video City dismissed the respondent on 20 May 1997 and that Commissioner Watling published his final decision in respect of the matter on 19 November 1997. No arrangement of dates within that period, even allowing for delays caused by the parties themselves and the Commissioner's first decision of 17 October, Mr Gates inferred, bears any relationship to a period of 20 weeks.

In the circumstances, Mr Gates contended, in the absence of any calculations of the kind that appear in Nicolson or in Bostik (Australia) Pty Ltd v Gorgevski (No. 1) (1992) 36 FCR 20 (upon which the employer relied at first instance), it is beyond this Commission to determine how the Commissioner, in the proper exercise of his discretion, came up with a period of 20 weeks. That time period, Mr Gates submitted, "has nothing more ... than the hallmarks of a figure which has been plucked out of the air and put into the decision as to what he [Commissioner Watling] believes to be suitable in this particular matter ...".5 In short, Mr Gates said, if we cannot satisfy ourselves as to the basis upon which Watling C made his determination of "20 weeks' wages" then that inability discloses a manifest error on the part of the Commissioner in the exercise of his discretion. In those circumstances, Mr Gates contended, we must uphold the appeal and revoke Commissioner Watling's order.

The Respondent's Case

Nothing put to the Commission by the appellant, Mr Holden contended, shows that Commissioner Watling's decision to award "20 weeks' pay" contained a manifest wrong. The Commissioner's determination, he said, was in effect an exercise of discretion based on all the facts and circumstances put to him: he observed and questioned the participants and the witnesses during the course of the hearing and he heard and studied the lengthy submissions and all the evidence. The Commissioner then considered and weighed those factors and "on balance", a classic exercise of discretion, Mr Holden submitted, arrived at his decision.

The two decisions issued by Commissioner Watling in this matter, Mr Holden submitted, show very clearly that he did not misdirect himself having regard to the totality of the submissions and evidence. To the contrary, he added, the Commissioner exercised his discretion in "a proper, reasonable, but on balance, conservative manner".6

The Commission's exercise of discretion, Mr Holden submitted, is guided by very well established principles, the primary authority being the High Court case of House v The King [1936] 55 CLR 499, 504-505 per Dixon, Evatt and McTiernan JJ, ie:

"It is not enough that the judges composing the appellate court consider that, if they had been in the position of the primary judge, they would have taken a different course. It must appear that some error has been made in exercising the discretion. If the judge acts upon a wrong principle, if he allows extraneous or irrelevant matters to guide or affect him, if he mistakes the facts, if he does not take into account some material consideration, then his determination should be reviewed and the appellate court may exercise its own discretion in substitution for his if it has the materials for doing so. It may not appear how the primary judge has reached the result embodied in his order, but, if upon the facts it is unreasonable or plainly unjust, the appellate court may infer that in some way there has been a failure properly to exercise the discretion which the law reposes in the court of first instance. In such a case, although the nature of the error may not be discoverable, the exercise of the discretion is reviewed on the ground that a substantial wrong has in fact occurred."

Having regard to those guidelines, Mr Holden submitted, the Commission should decide, as did a Full Bench in matter T1429 of 1988, that there is "not a scintilla of evidence to suggest that Mr Commissioner Watling called in aid an incorrect principle or misinterpreted the evidence. Nor do we consider that he applied his mind to extraneous matters of no relevance to the decision taken".7 In that case, Mr Holden said, the Full Bench "formed the opinion that this appeal may well have been summarily dismissed as trivial", a course of action which, he added, we should follow in the present matter.

Commissioner Watling's two decisions, when taken together, Mr Holden submitted, demonstrate that he took into account all the matters put to him by the parties. He even went to the extent of inviting the parties to put further submissions to him regarding remedy and, in doing so, informed them of his intention to have regard to certain decided cases which he nominated.8

In the circumstances, Mr Holden contended, given that the Commissioner's decision shows he considered all the factors put to him, weighed them, and made a determination "on balance", there was no obligation on Commissioner Watling to spell out the actual weight he gave to each particular factor. Consequently, he continued, there are no grounds for asserting, as the appellant does, that the Commissioner did not disclose the factors that led him to his decision regarding the level of compensation that he ultimately awarded.

Findings

In coming to his decision regarding compensation, Commissioner Watling's Reasons for Further Decision, at pages 3-5, show he considered and took into account the parties' contentions that:

  • the applicant's employment might have come to an end as the result of a lawful dismissal;

  • while the Court in Bostik found that the employee concerned had substantial security of employment, a finding echoed in Nicolson, that finding was not intended to be a proposition of universal application;

  • the applicant was employed pursuant to the Miscellaneous Workers Award which, as to termination, required of either party only one week's notice - consequently, appropriate compensation should be assessed at one week's pay;

  • the applicant's employment would not have continued for any length of time into the future because he frequently travelled to Sydney and desired to reside in that city;

  • because the applicant was 27 years of age, of reasonable intelligence, and had his future in front of him, his future earnings would not be jeopardised;

  • the applicant did not want reinstatement, but only the benefits that might flow from impracticality of reinstatement, because it was well known that he did not intend to stay with the Company if reinstated;

  • the applicant said there was no reason for him to leave his job and that his intentions regarding the Company and Sydney were nothing more than hearsay because all his assets were in Tasmania - his house, car, friends and girlfriend;

  • the applicant, although generally a good worker, was once counselled, albeit about an issue of no real significance;

  • the applicant said he was an exemplary worker - early for work, never late, often stayed back, and was conscientious;

  • the applicant said, contrary to the Company's submission, he had acted to mitigate his loss;

Having recited details of the parties' contentions and rebuttals, Commissioner Watling's decision shows he then moved to discuss the law that he proposed to apply and to make certain findings of fact. At the conclusion of that exercise the Commissioner went on to "appraise" "on balance" the amount that he proposed to award by way of compensation.

In our opinion Commissioner Watling's decision on its face makes it abundantly plain what he "balanced" and "appraised", ie the parties' contentions and rebuttals as recorded above. In the circumstances, in our view, there is no substance to the appellant's contention that Commissioner Watling did not say what he balanced or what he appraised.

The appellant's further contention that the compensation awarded should bear some connection to the passage of time over which the case was heard and determined, in our opinion having regard to the facts of the case, does not appear to have any relevance at all to the Commissioner's task. That is because the Commissioner's task, as he himself explained, was to assess, in terms of Nicolson, what might have occurred had the dismissal not taken place.

In dealing with this ground of appeal Mr Gates also included submissions concerning the quantum of Commissioner Watling's compensation order.9 Those submissions, in our opinion, are more appropriately dealt with under Appeal Ground No. 4.

It is clear to us, taking into account the above discussion and having regard also to what we say about security of employment under Appeal Ground No. 3 and quantum under Appeal Ground No. 4, that Commissioner Watling considered all the above factors in coming to his decision regarding compensation. From our perusal of the facts of the matter we find it difficult to see what else he should have relevantly considered. Certainly, in terms of House v The King, the principles of which we accept, it does not seem to us that Commissioner Watling either allowed himself to be guided by extraneous or irrelevant matters, or mistook the facts. In the circumstances we reject the contention that the Commissioner erred in that he did not disclose the factors that led him to fix compensation at "20 weeks' pay". Accordingly we dismiss Appeal Ground No. 1.

Appeal Ground No. 2

"The Commissioner erred by not providing weight or sufficient weight in the calculation of compensation or in the alternative by not revealing the weight and adjustment factor for the following matters:-

2.1 The applicant's conflict with his immediate supervisor which the employee had declined to ameliorate;

2.2 The applicant's delay in the commencement of proceedings before the Commission due to his inability to attend;

2.3 The unwillingness of the employee to readily accept certain tasks that were required to be undertaken;

2.4 The Commission's finding that the applicant may have chosen to terminate his employment and reside outside Tasmania."

The Appellant's Case

Commissioner Watling's order of "20 weeks' wages" is plainly unjust and unreasonable, Mr Gates submitted, because he failed to describe what weight, if any, he placed on the issues of the respondent's (i) conflict with his supervisor; (ii) delay in commencing proceedings; (iii) unwillingness to accept certain tasks; and (iv) intention to reside in Sydney. For that reason, Mr Gates contended, the Commissioner fell into error in the exercise of his discretion.

Conflict with immediate supervisor: Concerning the respondent's conflict with his Regional Manager, Mr Gates submitted, Commissioner Watling found that this remained unresolved because the respondent had declined to ameliorate the matter by seeking the assistance of other appropriate persons.10 However, he said, the Commissioner's order appears to assume that, were the respondent to have remained in his employment for that period of time, the issue would have been completely irrelevant. That is to say, he continued, it would not have impacted upon the likelihood of Video City terminating the respondent's employment or upon his resigning.

The evidence before Commissioner Watling on this issue, Mr Gates submitted, clearly shows that as between the respondent and others in the workplace there was a great deal of antagonism and conflict. For example, Mr Gates said, the respondent, whom Video City had employed for only nine months, conceded that he did not know how long he would last with the organisation; that he had problems because of personality conflicts with, in particular, his supervisor and also his Regional Manager; and that he maintained a perception, given to him by a Mr Reed, that he was over-qualified for the job he was employed to do but had potential for a supervisory position.11

The employer's concerns, Mr Gates submitted, were that the respondent had been counselled on one occasion about his interaction with customers; that his employment was terminated because of falsification of time and wages records; that he wanted to move to Sydney; and that, generally, his relationship with others at the workplace was unsatisfactory.12

All that evidence, Mr Gates contended, demonstrates that there was a poor working relationship at the workplace between the respondent and others, including the employer. In the circumstances, he submitted, it was clearly unreasonable for Commissioner Watling to assume that the employer/employee relationship between the respondent and Video City would have continued for, at least, a further 20 weeks. For those reasons, Mr Gates asserted, Commissioner Watling erred in that he failed to give any or sufficient weight to the evidence that was before him about the poor working relationship that existed at the workplace.

Delay in commencement of proceedings: The Commission's records, Mr Gates submitted, show that even though the respondent applied within the time period prescribed by the Act for a hearing in relation to his dismissal on 20 May 1997, the hearing itself did not commence until 18 September 1997 - almost three and a half months later. The evidence regarding that delay, Mr Gates submitted, is that the respondent failed to attend the first listed hearing of his application in Launceston on 28 July 1997 because he was out of the State at the time. The respondent, Mr Gates asserted, took no steps to inform the Commission that he would be unable to attend the hearing as notified. As a consequence, the appellant's representative, who resides in Hobart, travelled to Launceston in vain and at unnecessary expense.

It is clear from this evidence, Mr Gates submitted, that the delay in the matter coming on for hearing rested with the respondent and not with the employer (now the appellant). The significance of those circumstances, Mr Gates contended, is that they necessarily impacted upon Commissioner Watling's exercise of discretion to order "20 weeks' wages" as compensation. That is so he argued because, of necessity, the Commissioner's order must have a causal link with the period of time over which the case was heard and determined.

Mr Gates submitted that Commissioner Watling simply did not consider the question of delay as one of the issues he "balanced" in determining his order, because his Reasons for Further Decision contain no mention of the matter at all. If the hearing had proceeded on 28 July instead of 18 September, ie about one and a half months earlier, Mr Gates postulated, Commissioner Watling, in considering "20 weeks' wages" as his measure of compensation "would have been having a stab in the dark as to what this person would have done, what his loss would have been into the future".13 In the circumstances, Mr Gates contended, Commissioner Watling is manifestly in error because "it is unjust and it is unreasonable to penalise the employer in such a manner by awarding 20 weeks' pay when the delay was not through his fault".14

Unwillingness to readily accept certain tasks: The evidence that was before Commissioner Watling, Mr Gates submitted, does not support his finding that "... it is not possible to conclude that the applicant's employment might have come to an end as a result of a lawful dismissal ...".15 If, in that regard, Mr Gates continued, the Commissioner is relying on his subsequent observation that he could not "deduce a history of unsatisfactory work performance" then the evidence does not support that conclusion because "work performance" need not necessarily include conduct. Concerning conduct, Mr Gates said, the evidence shows that the respondent was counselled on one occasion, although the employer did concede it was not a significant matter.16 Nevertheless, Mr Gates went on, the matter was obviously an issue because, even though the respondent was otherwise a good worker, the employer felt he needed counselling.

There are other factors, Mr Gates submitted, that go to support the appellant's assertion that the employer/employee relationship would not have extended for a further period of 20 weeks. For example, he said, there was the reason for the dismissal itself, ie falsification of time and wages records, his reluctance to perform certain tasks that were on his duty statement, his problems with both his supervisor and Regional Manager as reflected, in the case of the former, in the warning that "failure to report to work [at a newly designated home library] will be taken as abandonment of your position".17

In the circumstances, Mr Gates contended, it was not reasonably open to Commissioner Watling, on the evidence, to conclude that the respondent would not have had his employment lawfully and fairly terminated before the expiry of a 20 weeks' period. That he did so conclude, Mr Gates submitted, was a manifest error and clearly unjust.

A desire to reside outside Tasmania: In relation to residing outside Tasmania, the employer's evidence before Commissioner Watling, Mr Gates said, was that it was well known the respondent wanted to reside in Sydney and that he frequently travelled to Sydney on his days off.18 Even though Mr Gates acknowledged that the respondent contested that evidence on grounds of relevance and hearsay, Commissioner Watling nevertheless appeared to attach significant weight to the employer's submission in that regard, Mr Gates submitted, because he found it "noteworthy that 30 of the 44 positions sought by the applicant were outside the State".19 The Commissioner also found, Mr Gates added, that he was not "persuaded that the applicant had a long term career" with Video City.20

The respondent's attraction to Sydney, Mr Gates submitted, when added to the counselling episode, the problems he was experiencing with his supervisor and his Regional Manager, and the fact that he did not have a long term career with Video City, shows that it would have been reasonable for Commissioner Watling to have concluded that the respondent would have moved to Sydney within a period of 20 weeks.

Mr Gates contended that to the extent the Commissioner did not so conclude, by instead ordering compensation at the level of "20 weeks' wages", his decision was unreasonable and he erred by not giving weight or sufficient weight to the evidence that was before him on this point.

The Respondent's Case

There is no decided authority anywhere, Mr Holden submitted, that obliged Commissioner Watling, or obliges any other Commissioner for that matter, to compartmentalise various elements of evidence as to their respective weights. The assessment of evidence, he said, relying on observations of Deputy President Johnson in McKenzie v Chubb Protective Services, is not a scientific calculation, but an exercise of discretion having regard to all the facts and circumstances.21 It must be that way, Mr Holden added, because it is very difficult to determine exactly what will happen in the future. For example, Mr Holden postulated, "who is not to say one of the supervisors would have left and that, given a statement about Mr Smith's potential, he may well have been elevated to the level of supervisor".22

Commissioner Watling did what the law required him to do, Mr Holden said - he based his decision on a balance of all the factors involved, including the four matters raised by Mr Gates in this ground of appeal.

Conflict with immediate supervisor: Mr Holden submitted that, because Commissioner Watling referred to and acknowledged in his decision the existence of "an unresolved conflict between the applicant and the Regional Manager", there is no substance to the argument that he did not give the matter some weight.23 As to whether that weight was, or was not, sufficient is a matter that the appellant did not address at all in terms of what the measure of weight should otherwise be - "is it a little or is it a lot?".

Furthermore, Mr Holden contended, the fact that the respondent applied for several jobs in both Launceston and Sydney at similar levels to the job he held with the appellant shows there is no factual basis for the allegation that he believed himself to be over-qualified for his then job.

Delay in commencement of proceedings: Mr Holden submitted that, to the extent that the appellant's submissions attribute delay solely to the respondent, they are wrong. The first hearing date nominated by Commissioner Watling, ie 9 July 1997 rather than 28 July as suggested by Mr Gates, was vacated by the Commissioner at the appellant's written request.24 In so advising the Commissioner, Mr Holden continued, Video City also informed him that the Company's prior commitments prevented it from appearing before the Commission for what amounted to 20 of the available forthcoming 30 working days.

There then followed some kind of communication breakdown, Mr Holden said, which subsequently involved the respondent not attending the rescheduled hearing of 28 July. The Commissioner dealt with that problem and subsequently relisted the matter for hearing on 18 September 1997.25

In the circumstances, Mr Holden submitted, the original delay was clearly not the respondent's responsibility.

Unwillingness to readily accept certain tasks: Commissioner Watling, Mr Holden contended, was well aware of this issue because he made mention of it in his decision. The Commissioner also reported that he could not "deduce a history of unsatisfactory work performance" on the respondent's part.26 In the circumstances, Mr Holden submitted, having already worked for Video City for nine months, the respondent might well have gone on to work with the Company for another two years. However, he said, Commissioner Watling determined that, having regard to all the facts, a further 20 weeks would be the maximum that could be expected. In so deciding, Mr Holden contended, Commissioner Watling clearly had regard to the respondent's alleged unwillingness to readily accept certain tasks.

A desire to reside outside Tasmania: The matter of the respondent's frequent travel to Sydney, Mr Holden submitted, is no more relevant to the present matter than whether he banks with the National Bank or the Commonwealth Bank. An employee, Mr Holden contended, is free to do what he wants outside working hours, provided that his activities do not have a detrimental effect on the employer. In any event, Mr Holden asserted, the respondent also had a house in Launceston, furniture, a girl friend and, of the 44 positions for which he applied, 14 were in Launceston.

The evidence in its totality, Mr Holden contended, discloses that there certainly were sufficient grounds available to Commissioner Watling to enable him to conclude that, had he not been unfairly dismissed, the respondent might in fact have stayed in Launceston indefinitely.

Findings

We reject at the outset the appellant's contention, which was put to us merely as an assertion from the bar table without any supporting authority, that Commissioner Watling erred by "not revealing the weight and adjustment factor" he assigned to each of the individual elements that make up this ground of appeal. The Commissioner's task, as we see it, was to weigh all the relevant facts and circumstances of the case before him and, in the exercise of his discretion, come to a conclusion based on those factors. In that regard we agree with Mr Holden. There is no decided authority, in our view, that could be said to oblige a Commissioner, in coming to a conclusion as the result of an exercise of discretion and apart from setting out the evidence upon which he or she relies for that conclusion, to slavishly prescribe the weight assigned to each evidentiary factor as if the exercise involved the application of some kind of precise arithmetical formula.

Moving now to Commissioner Watling's Reasons for Further Decision, it is clear to us on the face of his decision that, in coming to his conclusion, he considered and gave weight to three of the four separate elements that comprise this ground of appeal. At page 5 of his decision we note that he discussed and made findings regarding the matter of the applicant's conflict with his supervisor (Appeal Ground 2.1); the unwillingness of the employee to accept certain tasks (Appeal Ground 2.3); and, in the same context, he remarked on the possibility of the applicant choosing to terminate his job for the purpose of residing outside Tasmania (Appeal Ground 2.4).

In the circumstances we reject, as being without substance, the appellant's contention that Commissioner Watling erred by "not providing any weight" to those particular factors.

However, the appellant also argued that the Commissioner erred by not giving "sufficient weight" to those contentions. Concerning the respondent's conflict with his immediate supervisor, Commissioner Watling acknowledged that the conflict was unresolved, a fact he clearly took into account in finding that "I have not been persuaded the applicant had a long term career with the respondent".27 The structure of the Commissioner's decision shows that it was also one of the matters he balanced in coming to his conclusion regarding compensation.

The Commissioner also acknowledged the applicant's unwillingness to readily accept certain tasks and conceded that he "may have chosen to terminate his position ... and ... reside outside the State of Tasmania".28 Again, the structure of his decision shows that he considered and weighed both matters in coming to his decision regarding compensation.

These matters, as the appellant asserted, appear to suggest a less than satisfactory workplace relationship. But, the fact remains that they were all considered and taken into account by Commissioner Watling. As Mr Holden pointed out, it was he (Watling C) who "observed and questioned the participants and the witnesses ... and heard and studied the lengthy submissions and all the evidence".29 After reviewing the evidence in the light of that background, the Commissioner very clearly disclosed his findings in his decision, ie he could not conclude that the respondent's employment would have come to an end by way of a lawful dismissal and he could not deduce a history of unsatisfactory work performance.30

In our view those findings, as a matter of evidentiary weight, were clearly open to Commissioner Watling on the facts and circumstances before him. In terms of House v The King we are satisfied that the appellant's submissions disclose no error on the Commissioner's part in the manner in which he exercised his discretion.

For the above reasons we reject the appellant's contention that Commissioner Watling erred by not giving sufficient weight to the grounds of appeal here considered.

In terms of Appeal Ground 2.2 the appellant's contention, as we understand it, is that in some way Commissioner Watling, in ordering compensation of "20 weeks' pay", penalised the employer when the delay was not the Company's fault.31

The evidence shows that each party was responsible for some delay in the case proceeding to hearing. In the Company's case, that delay amounted to just short of three weeks (9 - 28 July 1997) whereas, in the respondent's case, the delay might arguably have been to the order of just over six weeks (28 July - 18 September 1997). In that regard we think Mr Gates was mistaken when he said delay amounted to "seven days" and "two months" respectively.32

Commissioner Watling dealt with the procedural aspects of the respondent's failure to attend the hearing of 28 July 1997 in his Reasons for Decision of 17 October 1997.33 We agree with the appellant that the Commissioner did not again refer to the matter of delay in his subsequent decision of 19 November 1997. Contrary to the appellant's submission, however, we believe the proper inference to be drawn from that omission is that, in the absence of any submissions to the contrary, the Commissioner regarded the question of delay, as a matter of evidentiary weight, as being neutral between the parties. Given that each party was responsible for some delay, we believe it was open to Commissioner Watling in the circumstances to take that view in determining the question of compensation. In terms of House v The King it does not appear to us that the Commissioner made an error, in that regard, in the exercise of his discretion.

However, in further support of the appellant's contention regarding delay and the associated notion of the employer suffering a penalty, Mr Gates argued that "the Commissioner's order must have a causal link with the period of time over which the case was heard and determined".34 This contention, too, was put to us by Mr Gates without benefit of any supporting authority and, as we see it, purely as a matter of conjecture. We take that view because he did not refer us to any evidence or commentary of either the parties or the Commissioner suggesting that, in coming to his conclusion about compensation, he should have regard to, or did take into account, the period of time over which he heard and determined the matter.

In our view this contention is without substance. There is no evidence of any kind, either before us or in his Reasons for Further Decision, that tends to show, or even suggest, that the Commissioner took into account, in making his determination regarding compensation, the period of time over which he heard and concluded the matter. Consequently, no question of penalty can arise.

In light of our finding above that it was open to Commissioner Watling to conclude, as he did, that the issue of delay was a matter of equal weight between the parties, we are of the opinion that the Commissioner did not err by "not providing weight or sufficient weight" to the matter of the "applicant's delay in the commencement of proceedings". In our opinion the course he took was one properly open to him on the evidence and nothing put to us shows that, in so exercising his discretion, he made any error of the kind referred to in House v The King.

For all the reasons advanced above we dismiss Appeal Ground No. 2.

Appeal Ground No. 3

"The Commissioner erred in that he failed to give any or sufficient weight to the submission of the respondent that the appropriate test to be applied to the determination of compensation was that set out in Bostik (Australia) Pty Ltd v Gorgevski [No. 1] (1992) 36 FCR 20."

The Appellant's Case

In terms of Bostik, Mr Gates submitted, the employer's submission was that the respondent, in his employment with Video City, had no substantial security of employment of the kind considered in that case. To the contrary, he said, because the respondent was then employed only in accordance with the Miscellaneous Workers Award, notice of one week by either party is all that was required to terminate the contract of employment. That submission, Mr Gates added, was specifically put to Commissioner Watling by Video City.35

The Commissioner, Mr Gates contended, erred in not accepting the submission. Not only did the respondent have no substantial security of employment, Mr Gates submitted, but there were also other factors that impacted upon the employment relationship. For instance, he said, although the respondent had only been employed for nine months, there was already the counselling episode, substantial problems with both his supervisor and his Regional Manager, and his reluctance to perform certain tasks.

All the evidence shows, Mr Gates submitted, that it would have been reasonable for Commissioner Watling to conclude that Video City would have lawfully terminated the respondent's employment on those grounds before the expiry of a 20 weeks' period. Mr Gates said the fact that the Commissioner did not so conclude and found, instead, that "it is not possible to conclude that the applicant's employment might have come to an end as a result of a lawful dismissal which was not unfair", demonstrates that he erred by not giving weight or sufficient weight to the evidence that was before him on this point.

The Respondent's Case

Commissioner Watling, Mr Holden said, told the parties in advance that he would look at certain cases, ie Perkins v Grace Worldwide (Aust) Pty Ltd (1997) 72IR 186, Nicolson v Heaven & Earth Gallery Pty Ltd (1994) 126 ALR 233 and Bostik (Australia) Pty Ltd v Gorgevski (No 1) (1992) 36 FCR 20 for purposes of determining the question of remedy.36 Having heard the parties on the issue he subsequently decided that he should follow Nicolson. It was clearly open to him to do so, Mr Holden submitted, not only on the facts and circumstances before him, but also because of the general line taken by this Commission in such cases as, for example and among others, Capital Hill Corporation Pty Ltd v O'Connor37 and McKenzie v Chubb Protective Services38.

Mr Holden submitted that, unless there were "very, very specific reasons why he should not have done that", and nothing was put by the appellant in these proceedings to that end, this ground of appeal must fail.

Findings

We note that Commissioner Watling did not specifically express an opinion about the employer's submission concerning the applicant's security of employment. However, in Capital Hill Corporation v O'Connor a Full Bench of this Commission (which included Commissioner Watling) considered and rejected a similar submission. In that case, after finding that the ILO Convention, by reason of Section 31(1A) of the Act, "vests employees with certain rights regarding termination of employment at the initiative of the employer" the Bench went on to observe that:39

"We think that ingredient [security of employment] is to be found in the several Articles of the ILO Convention and, in particular concerning the current matter, Article 7, ie 'the employment of a worker shall not be terminated for reasons related to the worker's conduct or performance before he is provided an opportunity to defend himself against the allegations made'."

In short terms, in our opinion, it is the Act itself that provides the necessary security of employment, ie an employee has the right to not be dismissed for misconduct or poor work performance unless and until he or she has been given an opportunity to defend themselves against the particular allegations. In the present matter it is exactly that right that Commissioner Watling found Video City had breached when it dismissed the respondent, ie "the applicant was denied the opportunity of having the allegations clearly presented to him, thus denying him an adequate opportunity to respond".40 The appellant did not challenge that finding in this appeal.

In the circumstances we have no doubt that, having considered Section 31(1A) of the Act and the ILO Convention,41 Commissioner Watling was fully aware of and took into account, when dealing with the question of compensation, the fact that, contrary to the employer's submission, the Act itself vested the respondent with a certain security of employment. In that regard, as he himself noted, the Commissioner was following Nicolson (a more recent relevant authority) rather than Bostik.

Having regard to the above discussion we are of the view that this appeal ground is without substance because it misconceives the law. It does so, in our opinion, because the respondent's security of employment derives not from case law such as Nicolson and Bostik or the award, but by operation of Part II, Standards of General Application of the International Labour Organisation's Convention concerning the Termination of Employment at the Initiative of the Employer as incorporated into Tasmanian legislation by Section 31(1A) of Industrial Relations Act 1984.

Appeal Ground No. 4

"The compensation ordered by the Commission was in all of the circumstances manifestly excessive and not in compliance with ILO Convention 158 and particularly Article 10."

The Appellant's Case

In support of the Company's submission that, in the exercise of his discretion in the matter of determining the appropriate amount of compensation, Commissioner Watling erred, Mr Gates relied on the contentions already mentioned above.

In addition, Mr Gates submitted that even though the applicant had been an employee of Video City for only nine months and was generally an unsatisfactory employee, Commissioner Watling nevertheless awarded compensation of "20 weeks' pay" or essentially five months' employment. In the circumstances, Mr Gates submitted, it was not appropriate in terms of Article 10 of the ILO Convention for Commissioner Watling to have awarded "20 weeks' pay" when that sum represented more than one-half of the respondent's actual period of service with Video City. That the Commissioner did so, Mr Gates contended, is manifestly excessive and unfair, having regard to all the surrounding facts.

Commissioner Watling also fell into error, Mr Gates submitted, in that he failed to obtain conclusive proof regarding certain matters that were fundamental to his making a proper assessment of the amount of compensation due to the respondent. For example, Mr Gates said, the applicant, when asked by the Commissioner to declare his earnings following the termination of his employment with Video City, reported that "I've earned about three and a half thousand dollars".42 No other evidence of any kind, eg copies of pay packets,43 Mr Gates continued, was put to the Commissioner on this point. In the circumstances, he submitted, it was impossible for Commissioner Watling to know exactly how much the applicant had received. That is because, he explained, "'about' is fairly ambiguous. Does 'about' mean probably $3300 or does 'about' mean four grand; does 'about' mean gross or net. I mean - he says it was gross, but was he wrong?"44

In such circumstances, Mr Gates submitted, the onus is on the Commission to at least accurately establish a fact that is so absolutely fundamental. For example, he argued, if the amount earned by the respondent was actually $3700, rather than $3500, then, should the Commissioner's order be upheld, Video City must pay $200 more than it is legally required to do on the basis of a proper application of the relevant principles. Such an outcome, Mr Gates contended, would be absolutely unfair. For that reason, he submitted, Commissioner Watling's reliance upon the respondent's inexact expression of his actual earnings constituted a fundamental error on the part of the Commissioner.

Commissioner Watling also fell into error, Mr Gates asserted, by failing to exactly identify the amount of unemployment benefits that the respondent received. That must be so, he said, because even the former employee, when responding to a question from the Commissioner, conceded that the weekly amount was not exactly $158, but "within cents" of that figure.45 Clearly, Mr Gates submitted, the Commissioner's acceptance of $158 was wrong, because the evidence shows that it was an incorrect amount.

Furthermore, Mr Gates contended, Commissioner Watling failed to take into account, in determining the amount of compensation due to the respondent, any mitigating effect of the respondent's hopes for a job in the near future with the Sydney Harbour Casino. That job, according to the respondent's evidence, Mr Gates said, "will replace what monies I have lost over the past six months".46 While the Commissioner never asked the respondent for any information on that job, the view of Video City, Mr Gates said, is that the evidence suggests the level of earnings the respondent expected from the new job would be "in excess of his wages through Video City and therefore there [would] be a net effect ... obviating that loss over time".47

It follows therefore, Mr Gates contended, that because the respondent intended to mitigate his loss, the expected new job and the earnings that would flow from it constituted a material factor that Commissioner Watling should have considered and weighed in determining the amount of compensation. The fact that he did not do so, Mr Gates said, caused him to fall into serious error because he assessed compensation at an excessive level, which resulted in a manifest injustice to the employer.

The Respondent's Case

There is nothing in the appellant's submissions, Mr Holden asserted, that goes to support the claim that Commissioner Watling's decision was contrary to the ILO Convention. In McKenzie v Chubb, he said, a decision was taken to award compensation on the basis of 20 weeks' pay in circumstances not dissimilar from those that apply in the present case, ie a relatively short period of employment, disharmony between the employee and a supervisor, and the absence of precise calculations regarding earnings following dismissal.48

Mr Holden submitted that, in the circumstances, nothing has been put to the Commission by the appellant that in any way suggests "20 weeks' pay" is excessive. The respondent, he said, was found by Commissioner Watling to have been unfairly dismissed, as a consequence of which he is entitled to compensation to recompense that wrong, his future prospects with Sydney Harbour Casino notwithstanding, since that is an irrelevant consideration.

Findings

To our mind, the applicant's opinion that the respondent was generally an unsatisfactory employee is not necessarily well-founded from an evidentiary point of view. While it is quite clear that the respondent's conflict with his immediate supervisor remained unresolved49 and that he was reluctant to perform certain tasks required of him,50 other evidence, we believe, operated to his advantage. For example:

  • the appellant acknowledged that the applicant was generally a good worker;51 and

  • Commissioner Watling found that there was no history of unsatisfactory work performance.52

Other factors that follow below, which Mr Gates relied on in support of the contention that the respondent was generally an unsatisfactory employee, in our view, do not assist the appellant's case.

First, Mr Gates encouraged us to accept that, because the respondent took the view53 that he was over-qualified for the job required of him, he might well become dissatisfied in the absence of any promotion. So far as we can see from the evidence, that proposition is merely conjecture, since it appears to have no evidentiary basis whatsoever.

Second, Mr Gates reminded us that the respondent was counselled on one occasion which, he said, must have been an issue because, otherwise, there would have been no need for the counselling. On the appellant's own admission however, as Commissioner Watling recorded in his decision, the issue was not considered to be significant.54

Third, Mr Gates called in aid the employer's allegation that the respondent was dismissed for "falsification of time and wages records".55 As we read his decision, there was no conclusion of that nature by Commissioner Watling, whose finding was simply that "the applicant did not accurately complete his time sheet for 16 May 1997, to reflect his absence from work"56 during a particular period on that day. Whether that was an innocent error or a deliberate falsification, however, is a matter the Commissioner was not required to address, because he found that the employer "did not genuinely and fully investigate the allegations".57

We have set these matters out in some detail for the purpose of demonstrating that, contrary to the appellant's submissions, it was clearly open to Commissioner Watling, on the evidence, to conclude that the employee was something better than "generally unsatisfactory".

Mr Gates next placed emphasis on the fact that, despite the respondent's period of employment with the Company being only nine months, Commissioner Watling had ordered the equivalent of five months' employment. While conceding that Article 10 of the ILO Convention does not refer to compensation based on service, Mr Gates submitted that the Article nevertheless vests a wide discretion in the Commission to award such compensation as it "deemed appropriate". By way of example, he continued, an employee with 20 years' service may be treated differently from one with, say, one week's service. Mr Gates could not, however, cite any authority that supported his contention.

In the circumstances, we do not accept that length of service is necessarily a concept of essential relevance to a question of compensation that arises under Article 10 of the ILO Convention. As we have already stated, relying on Nicolson, compensation is a matter to be assessed on the basis of, in Commissioner Watling's words, "what would have been likely to occur if the unfair dismissal of the applicant had not taken place".58 In our view, that is what Commissioner Watling did in fact do.

Mr Gates continued by pressing us to adopt the view that, given the applicant's demonstrated desire to live in Sydney, it was not open to Commissioner Watling, having found that the applicant did not have a long term career with the Company, to then find that the applicant would not have moved to Sydney within a 20 weeks' period. We have already found that the Commissioner took these matters into account in coming to his conclusion about compensation.59 Commissioner Watling's decision shows that he was also aware of and took into account the evidence before him that (a) the respondent challenged what he called hearsay evidence about his intentions regarding Sydney;60 (b) the respondent's assets and personal relationships were in Tasmania;61 and (c) he had applied for 14 jobs in Launceston.62 In light of that evidence and being of the opinion that an order of "20 weeks' pay" in the circumstances does not contradict the Commissioner's finding concerning the respondent's long term career prospects, we are of the opinion that it was open to Commissioner Watling to form the view that he did as to the quantum of compensation.

Another aspect of the appellant's contentions regarding Commissioner Watling's order reflects in the assertion put to us by Mr Gates that "20 weeks' pay" was a figure "plucked out of the air" by the Commissioner as an outcome that he personally believed suitable for the occasion.63 As to quantum of compensation, the employer's submission (relying on a perceived absence of security of employment) was that it should not exceed one week's pay. It does not appear to us that the applicant gave Commissioner Watling the benefit of any submissions on the point. However, taking into account our earlier finding regarding the respondent's security of employment,64 we are of the view that it was open to the Commissioner to make a finding, on the evidence, that exceeded the measure of one week's pay.

In putting the appellant's submissions to us regarding this issue, Mr Gates made much of the fact that, in describing his income since the termination of his contract of employment, the respondent could only say that his earnings were "about" a certain sum and that his unemployment benefit was "within cents" of a particular weekly amount. Admittedly, the respondent offered that information by way of submission from the bar table without the benefit of any supporting evidence. However, the fact is that the appellant, at first instance, did not in any way challenge those submissions, seek to rebut them, or urge Commissioner Watling to disregard them as unreliable for want of evidentiary basis. In the circumstances, we believe the Commissioner was entitled to rely on the information put to him by the applicant.

For these reasons, while we believe the Commissioner's order of "20 weeks' pay" was at the high end of an imaginary scale of compensation that he might have ordered, the fact that had we been in Commissioner Watling's position we might have taken a different course does not, in terms of House v The King, assist the appellant. Taking into account all our earlier findings and having regard to House v The King, the appellant's submissions do not, in our view, persuade us that, in exercising his discretion, Commissioner Watling made any error in determining the amount of compensation to order by acting on a wrong principle, allowing extraneous or irrelevant matters to guide him, mistaking the facts, or by omitting to take into account some material consideration. Nor is it our view that, merely because his order exceeded what we might have awarded had we been in his place, the Commissioner's order was for that reason unjust or unreasonable.

Finally, Mr Gates asserted on the appellant's behalf that Commissioner Watling had failed to take into account the prospective earnings likely to flow from the respondent's job offer from Sydney Harbour Casino. Assuming the respondent had an actual job offer at the time (13 November 1997) - the applicant made conflicting statements on this point, ie "I hope to have a job within about two weeks"65 but, later on, "I have been given ... a job"66 and then, a little later still, "another job ... which starts in around three weeks"67 - it does not seem to us to be relevant to the Commissioner's considerations. We take this view because, beginning at the date of the respondent's termination, ie 20 May 1997, the 20 weeks' period of Commissioner Watling's order arguably expired on or about 7 October 1997, well before the respondent was due to start his new job, if he actually had one, in early December 1997. For that reason we believe the respondent's possible earnings from his presumed new job with Sydney Harbour Casino was not a factor that Commissioner Watling was obliged to take into account in his consideration of compensation.

For all the reasons discussed above we dismiss Appeal Ground No. 4.

Conclusion

Taking into account the findings we have made above regarding the several Grounds of Appeal put to us by the appellant we confirm Commissioner Watling's decision and order, and dismiss the appeal.

 

F D Westwood
PRESIDENT

REASONS FOR DECISION

DEPUTY PRESIDENT KING (DISSENTING)

I have had the benefit of reading the conclusions of my colleagues in this matter and agree with many of their findings. However, on the critical issue of the exercise of Commissioner Watling's discretion in his decision in T7008 of 1997, I believe on the evidence before him he (the Commissioner) erred in his assessment of adequate compensation by awarding twenty (20) weeks pay.

It is my view that the appellant in this matter has established a case to support the contention in appeal Ground 2, (2.1) that the Commissioner erred in not giving sufficient weight to the evidence going to Mr Smith's (the Employee) conflict with his immediate supervisors in arriving at his assessment of compensation. Likewise in appeal Ground 2. (2.3) I believe that the Employee's unwillingness to do certain tasks in accordance with the requirements of the employer has not been given sufficient weight by the Commissioner. His decision that twenty (20) weeks was a reasonable assessment of how long the Employee would have remained in employment with Classic Video Pty Ltd if not for the unfair dismissal is therefore I believe flawed and excessive.

The evidence in the case before the Commissioner was that the immediate supervisor was intimidated by the Employee, that there were problems between the Employee and the regional manager and that he refused to undertake some basic tasks in accordance with the "duty list".

This evidence came from the supervisor herself and from the northern regional manager. Mr T Ewing the Managing Director of Classic Video in general submissions and in examination of the above personnel also highlighted the problems between the Employee and his supervisors.

There are no less than twenty separate references to the above problems in the transcript of proceedings in the first instance.68 The Commissioner in his decision concludes that "there still exists an unresolved conflict between the applicant and the Regional Manager which the applicant declined to ameliorate by seeking the assistance of the General Manager of Operations and/or the Managing Director". The Commissioner goes on to record "In addition, evidence presented during the hearing tends to indicate the applicant did not readily accept that certain tasks were required to be undertaken in accordance with the `duty list'".69

It is my view that these findings and the evidence that led to them were not given sufficient weight by the Commissioner.

I note that the Commissioner himself found that there were reasons why re-instatement was not possible and therefore compensation was appropriate.

The major consideration given by him for that finding was that there was conflict between the Employee and his immediate supervisor.70 If that conflict was accepted as the major reason for not awarding re-instatement it must also be accepted as a major consideration in determining how much longer the employment relationship may have lasted but for the unfair dismissal. It is my conclusion based on the evidence before the Commissioner that the employment relationship would have terminated either by a lawful dismissal or by a decision of the Employee before the expiry of twenty (20) weeks.

In the context of the above conclusion it is appropriate to note part of the submission of Mr Smith before the Commissioner when dealing with one of the problems between himself and his supervisors. It is recorded in the transcript of proceedings before Commissioner Watling as follows:-

"Mr Smith

Now I had stated to her that I was not - you know, it was causing me stress and as a result I feared that they would either fire me or I would have to quit because of the stress they were putting me under and I made Jodi aware of that. She didn't seem at all concerned that I would quit and she made no attempts to clarify or settle the situation which was quite unfortunate."71

(For the record I note that Mr Smith represented himself in the initial proceedings and therefore did not give evidence.)

Having concluded as I have in relation to Appeal Grounds 2.1 and 2.3 it follows that I also find in favour of the appellant in Appeal Ground 4 i.e. in the context of this case "the compensation ordered by the Commission was in all the circumstances manifestly excessive".

For the above reasons I determine this matter by upholding the appeal.

 

J G King
DEPUTY PRESIDENT

Appearances:
Mr S J Gates of the Tasmanian Chamber of Commerce and Industry Limited for and on behalf of Classic Video Pty Ltd trading as Video City with Mr T Ewing.
Mr D Holden for Mr T R Smith.

Date and place of Hearing:
1998
February 16
Hobart

1 Classic Video Pty Ltd trading as Video City.
2 T7008 of 1997, Reasons for Further Decision 19 November 1997, p. 5.
3 T7008 of 1997, Reasons for Further Decision 19 November 1997, p. 5.
4 Supra.
5 T7402 of 1997, transcript 16/2/98, p. 5.
6 Supra, p. 35.
7 Appeal against decision of Watling C in matter T1117 of 1988 re sea-based fin fish farm employees (Koerbin P, Gozzi and King CC)
8 T7008 of 1997, Reasons for Decision 17 October 1997, p. 12.
9 Above, p. 3.
10 T7008 of 1997, Reasons for Further Decision 19 November 1997, p. 5.
11 T7402 of 1997, transcript 16/2/98, pp. 10-12.
12 Supra, pp. 7, 12-13.
13 Supra, p. 15.
14 Supra, p. 14.
15 T7008 of 1997, Reasons for Further Decision 19 November 1997, p. 5.
16 Supra, p. 4.
17 Exhibit A1 in the proceedings before Watling C.
18 T7008 of 1997, Reasons for Further Decision 19 November 1997, p. 4.
19 Supra, p. 5.
20 Supra.
21 T6816 of 1997, Reasons for Decision 29 October 1997, p. 33.
22 T7402 of 1997, transcript 16/2/98, p. 42.
23 T7008 of 1997, Reasons for Further Decision 19 November 1997, p. 5.
24 Exhibit 3.
25 T7008 of 1997, Reasons for Decision 17 October 1997, pp. 2-3.
26 T7008 of 1997, Reasons for Further Decision 19 November 1997, p. 5.
27 T7008 of 1997, Reasons for Further Decision 19 November 1997, p. 5.
28 Supra.
29 Above, p. 3.
30 T7008 of 1997, Reasons for Further Decision 19 November 1997, p. 5.
31 Above, p. 7.
32 T7402 of 1997, transcript 16/2/98, p. 52.
33 T7008 of 1997, pp. 1-3.
34 Above, p. 7.
35 Above, p. 3.
36 T7008 of 1997, Reasons for Decision 17 October 1997, p. 12.
37 T6915 and T6918 of 1997.
38 T6816 of 1997.
39 T6915 and T6918 of 1997, Reasons for Decision 1 October 1997, p. 22.
40 T7008 of 1997, Reasons for Decision 17 October 1997, p. 10.
41 Supra, p. 11.
42 T7008 of 1997, transcript 13/11/97, p. 114.
43 T7402 of 1997, transcript 16/2/98, p. 28.
44 Supra, p. 27.
45 T7008 of 1997, transcript 13/11/97, pp. 114-115.
46 Supra, p. 114.
47 T7402 of 1997, transcript 16/2/98, p. 32.
48 In presenting this submission Mr Holden acknowledged advice from the Bench that no order has yet issued in McKenzie v Chubb because the parties are to make further submissions on the question of the amount of the applicant's earnings following dismissal.
49 Above, pp. 6-7.
50 Above, p. 8.
51 T7008 of 1997, Reasons for Further Decision 19 November 1997, p. 5.
52 Supra, p. 4.
53 We do not say that he did in fact hold such a view, because Comissioner Watling made no finding on the point.
54 T7008 of 1997, Reasons for Further Decision 19 November 1997, p. 4.
55 Above, p. 8.
56 T7008 of 1997, Reasons for Decision 17 October 1997, p. 8.
57 Supra, p. 10.
58 T7008 of 1997, Reasons for Further Decision 19 November 1997, p. 5.
59 Above, p. 12.
60 T7008 of 1997, Reasons for Further Decision 19 November 1997, p. 4.
61 Supra.
62 Supra, p. 5.
63 Above, p. 3.
64 Above, p. 14.
65 T7008 of 1997, transcript 13/11/97, p. 114.
66 Supra, p. 116
67 Supra, p. 117.
68 T7008 of 1997 transcript pages 12, 27, 38, 40, 42, 66, 72, 87, 89, 92, 93, 95, 98, 99, 107, 108., 109, 111, 121 and 129
69 T7008 of 1997 page 5 decision 19 November 1997
70 T7008 of 1997 page 2 decision 19 November 1997
71 T7008 of 1997 transcript page 12