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T9287

 

TASMANIAN INDUSTRIAL COMMISSION

Industrial Relations Act 1984
s70(1) appeal against an order

Kenneth James Farrell
(also known as Ken Farrell)

(T9287 of 2001)

and

The Crown in Right of State of Tasmania
Department of Premier and Cabinet
Office of the Premier

 

FULL BENCH:
PRESIDENT P L LEARY
COMMISSIONER P A IMLACH
COMMISSIONER T J ABEY

HOBART, 18 September 2001

Appeal against order handed down by Commissioner P C Shelley on 1 November 2001 in Matter T9147 of 2000 - identification of employer - jurisdiction to enforce instrument of appointment - period of notice - hearsay evidence - procedural fairness - appeal dismissed - decision confirmed

REASONS FOR DECISION

Introduction

(1) These proceedings concern an appeal against a decision of Commissioner Shelley on 1 November 2000.1 The hearing at first instance dealt with an application lodged by Kenneth James Farrell alleging that he had been unfairly dismissed by his employer, the Crown in Right of State of Tasmania, through Office of the Leader of the Opposition. In the case at first instance, Mr Farrell was represented by Mr R Young, a legal practitioner. In the appeal proceedings Mr Farrell represented himself.

Background

(2) The background to this dispute was described in Commissioner Shelley's decision as follows:2

"Mr Kenneth James Farrell commenced work on 14 December 1998 as an adviser to the then Leader of the Opposition, the Honourable Tony Rundle, MHA. Mr Farrell's principal role was economic analysis of state government initiatives and appropriate matters in the public domain.

On 8 February 1999 he was appointed to that position, by an Instrument of Appointment ("the Instrument"), formalising his appointment from the date he commenced (14 December 1998). The Instrument contained provisions relating to the terms of his employment, in particular the duration of the appointment and the manner in which it could be terminated. Schedules to the Instrument set out conditions of employment in relation to remuneration, superannuation, expenses, general employment conditions, and severance pay entitlements should the appointment be terminated in accordance with the provisions of the Instrument.

The Instrument allowed for the termination of the appointment by the giving of two weeks notice in writing either by Mr Farrell or by the Premier or his delegate.

Should the employment not be terminated by either party in the above manner, then the appointment would remain in place until 31 October 2002, or the end of the term of government, whichever occurred sooner.

On 2 July 1999, the Honourable Sue Napier became the new Leader of the Opposition, and Mr Farrell's employment continued as before.

On 1 February Mrs Napier verbally advised Mr Farrell that she had decided to terminate his employment on the basis that she wished to have a political adviser rather than an economic adviser; that Mr Farrell did not have the required political policy skills; and that consequently there would not be a job in her office for a full time economic adviser.

Mr Farrell was advised that his employment would terminate on 1 June 2000, that is, four months later. This advice was confirmed, in writing, by Mrs Napier to Mr Farrell in a letter dated the following day, 2 February 2000. In that letter Mrs Napier said that action would be initiated to conclude his appointment with effect from close of business on 1 June 2000.

On 13 February 2000 Mr Farrell, in a letter to Mrs Napier, outlined the substance of the discussions which had taken place at the meeting between himself and Mrs Napier on 2 February 2000. In that letter he requested that, if he was unable to find new employment prior to 1 June 2000, then he would be assisted were he to be able to take leave without pay at that point, for a period of one month, and, by doing so, delay his termination date until 1 July 2000.

On 9 May 2000, Mr Farrell, in a letter to Mrs Napier, repeated his request for leave without pay for the period 2 June 2000 until 3 July 2000 and that his appointment be concluded with effect from close of business 3 July 2000.

The evidence was that Mrs Napier granted that request, however she subsequently advised Mr Farrell, by letter dated 25 May 2000 that, whilst she was prepared to extend his period of employment until 3 July 2000, and would advise the Premier accordingly, leave without pay was contrary to Departmental policy, which required employees to utilise recreation leave credits before leave without pay could be granted, unless there were exceptional circumstances. Mrs Napier requested that Mr Farrell provide details of any such exceptional circumstances, or, alternatively, that he submit an application for recreation leave. Mr Farrell neither provided details of exceptional circumstances, nor did he apply for recreational leave.

Mr Farrell continued to attend for work until 1 June 2000, after which date he went on a vacation with his partner and her children, returning to Hobart on 15 June. He did not present for work again. Mr Farrell's salary continued to be paid into his credit union account, with payments made on 7 July, and 21 July. Both pay advice slips described the payments as "normal pay", not as recreation leave payments. The evidence was that the absence was subsequently regarded as recreation leave on the part of the Department.

On 22 June 2000, the Secretary of the Department of Premier and Cabinet, Linda Hornsey, formally advised Mr Farrell, in writing, that in accordance with his Instrument of Appointment, the Premier had given approval for the termination of his appointment, effective from close of business on Monday 3 July 2000. Mr Farrell's evidence was that he did not receive the letter until Monday 26 June 2000.

On or about 6 July 2000 Mr Farrell received a salary payment advice dated 3 July setting out the details of the payment that had been made to him on the termination of his employment.

On 5 July 2000 Mr Farrell wrote to Ms Hornsey and to the Premier, the Honourable Jim Bacon, MHA, stating that he did not accept the termination or the terms of the termination, and requesting that it be reviewed. He also asked what procedures he should follow in order to initiate such a review.

In a letter dated 18 July 2000, Mr Geoff Owen, Acting Director, Corporate Services, responded to both letters, saying inter alia, that Mr Farrell's employment had been terminated by the Premier in accordance with the provisions of the Instrument of Appointment.

On 28 July 2000, Mr Farrell wrote again to the Premier, advising that he disputed that the termination of his employment was valid and that he disputed that he was on recreation leave during the month of June.

On 11 August 2000, Mr Farrell made application to this Commission for a hearing in respect of an industrial dispute, alleging unfair termination of employment."

Commissioner Shelley's Findings

(3) Commissioner Shelley initially determined a jurisdictional question and an application for extension of time. Neither of these decisions are subject to the appeal proceedings. In dealing with the merits of the application the Commissioner made a number of findings which can be summarised as follows:

Valid Reason

(4) The requirement of a senior politician to obtain one kind of advice, in preference to another, falls within the test of what "operational requirements" means. The work performed by Mr Farrell was no longer required in the restructured environment.

(5) Mr Farrell was dismissed for a valid reason, which was a genuine redundancy situation arising out of the operational requirements of the Office of the Leader of the Opposition, and in this respect the dismissal was not unfair.

Severance Pay

(6) The six weeks' severance pay calculated in accordance with Schedule 3 of Mr Farrell's Instrument of Appointment equated to four weeks' pay for each year of service or part thereof. The schedule was consistent with Article 12 of ILO Convention 158 and in the circumstances the amount of severance pay was fair.

The "Contract" of Employment

(7) Because the Instrument of Appointment contains a clause which gives the unqualified right to either party to terminate the contract at any time upon the giving of two weeks' notice without reason, and it contains a term which provides for severance pay in the circumstances, Mr Farrell's contract is not a fixed term contract. The date of expiry [i.e. 31 October 2002) or the termination of the Government, does no more than state the maximum duration of the contract.

The Martin Case3

(8) There are many more differences between Martin and the instant case than there are similarities. In particular, Mr Martin was immediately removed from his employment and hence given no opportunity to persuade his employer to reconsider his termination. This can be contrasted with Mr Farrell's situation in that he had five months in which to try and influence the final outcome.

Notice

(9) The ILO Convention requirement for a worker to be given a reasonable period of notice applies to the commonsense every day understanding of what notice is. It should not be vague or equivocal and should clearly specify what it is that is going to happen. The Commissioner was of the view that Mr Farrell knew that his employment was going to be terminated five months prior to the date of termination, and that he accepted this as notice. In the circumstances Mr Farrell was given reasonable notice consistent with the terms of the ILO Convention.

The Formal Notice Required by the Instrument of Appointment

(10) The Commission does not have jurisdiction to enforce the terms of the Instrument of Appointment.

(11) It is accepted that the formal notice given by letter dated 22 June 2001 fell short of the two weeks required by the Instrument of Appointment. Whilst there was no evidence either way as to whether Ms Hornsey had a delegation from the Premier, it was a reasonable assumption that she had been instructed to so act by the Premier.

(12) The contention that a deficiency in the formal notice meant that there is no notice, is rejected as the Commissioner had already found that reasonable notice had been given consistent with the requirements of the ILO Convention.

Procedural Fairness

(13) Mr Farrell was given clear reasons for his termination and ample opportunity to try to persuade Mrs Napier to reconsider her position. The evidence was that Mr Farrell did not indicate an intention to challenge the decision until after the date of termination. There was therefore no breach of procedural fairness.

(14) The only aspect of Mr Farrell's dismissal which was unfair was that he did not receive an additional week of employment in accordance with the formal notice requirements of the Instrument of Appointment. Apart from that the dismissal itself was not unfair, either procedurally or substantively.

Other Issues

(15) Comments attributed to other members of the Liberal Party, to the effect that they disagreed with Mrs Napier's decision, were hearsay only and not relevant to the industrial questions to be decided.

Remedy

(16) In settlement of the industrial dispute, Mr Farrell should be paid one weeks' wages. Mr Farrell was dismissed for a valid reason, paid reasonable severance pay, given reasonable notice and given the opportunity to put his case prior to his dismissal. The only unfairness to Mr Farrell was the failure in timing, by one week, in the issuing of his formal notice under the terms of the Instrument of Appointment.

Grounds of Appeal

(17) Mr Farrell lodged eight grounds of appeal but during proceedings withdrew one of them. The grounds for the consideration of this Bench are as follows:

1. "The decision is inconsistent in finding that I was not properly notified of the termination, which is unfair yet I was not unfairly dismissed. I have been fed a curate's egg.

2. The decision is also inconsistent in several areas of its argument, including but not limited to for example it dismisses my sworn evidence of what the Members of the Parliamentary Liberal Party said to me as hearsay yet it apparently allows hearsay evidence of the Crown such as the statement in Linda Hornsey's letter of 22 June 2000 that the Premier had approved the termination of my appointment. No evidence was presented to the hearing that the Premier did in fact give such approval and the Commission therefore has no grounds other than hearsay to assume that he did. I wish to describe all of these inconsistencies to the Commission.

3. The decision is contrary to law and legal precedent in that a breach of the termination requirements of the Instrument of Appointment was admitted by the Crown and therefore the contract is a nullity and damages are at large.

4. The Decision does not take into account a number of facts and considerations, including but not limited to the reasons Mrs Napier took nearly 5 months to act on her stated intention to take action to terminate my appointment, the fact that Mrs Napier did not and has not restructured her office and my capacity to fill a new position that may have been created in any restructuring (a matter specifically identified in my application for a Hearing yet not specifically addressed in the Decision), the failure of the Crown as my employer to exercise appropriate care in its duty to ensure the termination of my appointment was fair, and Mrs Napier's relationship to the Premier in terms of her capacity to reasonably give me notice of termination. These are too numerous to mention in precis and I wish to have the opportunity to put them to the Commission in detail.

5. The Decision incorrectly interprets a number of facts and arguments including but not limited to what my duties were in Mrs Napier's office, what was the appropriate termination date if any, the role of Ms Linda Hornsey, Secretary of the Department of Premier and Cabinet, and the right of Members of Parliament to dismiss their employees without constraint. I wish to detail these incorrect interpretations to the Commission.

6. Parts of the Decision rely in part on the Commission's own interpretation and logic rather than on evidence and argument put by the parties at the Hearing, such as Linda Hornsey's role. In some of those I differ strongly with the Commission's interpretation and logic yet I have been accorded no opportunity to challenge them. Neither has the Crown. It is only fair that both parties should have an opportunity to put their views on argument and interpretation forming part of the decision that neither party has had an opportunity on which to comment to the Commission.

7. Even if the decision overall were correct, and I state again that it is not, the compensation awarded is incorrectly calculated by reference to 3 July 2000 rather than to 1 June 2000 being the date which Mrs Napier advised me she would be terminating my appointment and from which there was no variation, in fact there was specific exclusion by the Crown itself of the termination arrangement I requested. The Crown has expropriated my rights to termination payments as of 1 June 2000 in order to pay me salary from 1 June to 3 July 2000. This has been at considerable financial cost to me."

(18) To be successful in an appeal, the appellant is required to demonstrate that the Commissioner at first instant:

    1.  made a legal error;

    2.  acted on a wrong principle;

    3.  gave weight to an irrelevant matter; or

    4.  gave insufficient weight to a relevant matter; or

    5.  made a mistake as to the facts;

    6.  or the decision was plainly unreasonable or unjust.

(19) The guiding principles for the determination of appeals are found in the High Court judgement in House v The King [1936] 55 CLR 499, at 504-505 per Dixon J, Evatt J and McTiernan J which provides:

"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 to properly exercise the discretion which the law reposes in the court of first instance. In such 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."

(20) On the authority of House v The King it is clear that it is not enough that members of an appellate bench, had they been hearing the matter in the first instant, may have formed a different view. There must be some error in the exercise of discretion in the first instance.

(21) Similarly it is very clear that appeals in this jurisdiction do not proceed by way of re-hearing. The appellant must show where the Commissioner at first instance fell into error. This is an important consideration in this case as elements of the appellant's case certainly strayed into the area of a re-hearing.

(22) A further difficulty is that the appellant chose to argue the grounds in a global sense with a number of contentions and themes recurring in more than one ground.

(23) For these reasons we have chosen to depart from the normal procedure of considering each ground as a separate entity. Instead we have looked at the totality of Mr Farrell's submissions and summarised his major contentions. We have then considered a number of key questions which go to the heart of the original application and the appeal. Having determined those questions we then address the appeal grounds.

The Appellant's Submissions

(24) Having looked at the totality of Mr Farrell's submissions we have summarised his main contentions as follows:

(25) Section 4[a] of the Instrument of Appointment requires the giving of two weeks' notice of termination. Mr Farrell was only given six or seven days' notice and therefore the termination was unfair.

(26) Fairness does not have a dimension. It is either fair or it is not fair. There is no middle ground as it is impossible to know the outcome had the unfair event not occurred. The Commissioner erred in that she stated:4

"I find that the only aspect of Mr Farrell's dismissal which was unfair was that he did not receive the additional week of employment. I do not find that the dismissal itself was unfair, either procedurally or substantively."

(27) It is not open to the Commissioner to find that one aspect of the termination to be unfair, but that the termination overall was not unfair.

(28) What might be seen as a small administrative glitch can have serious consequences. There was no evidence that Ms Hornsey was the Premier's delegate in purporting to effect the termination, and in any event the letter from Ms Hornsey5 did not actually terminate his employment. Just because an administrative glitch may appear minor does not make it any less unfair. In the absence of evidence the Commissioner erred in finding that Ms Hornsey did have a proper delegation from the Premier.

(29) There is ambiguity in the Instrument of Appointment. Clause 1[a] states:

"The appointment shall be for a term expiring on the thirty first day of October two thousand and two or on the resignation or other termination of the Government whichever shall occur earlier [hereinafter called 'the termination date']."

(30) Whereas Clause 4(a) states:

"The appointment may be terminated by the appointee or by the Premier, or his delegate, upon two weeks notice in writing to the other."

(31) In 1[a] shall can only be read as must. There is clearly ambiguity between the two clauses and we don't know which takes precedence. In these circumstances the doctrine of contra preferentum is important. This doctrine states:6

"... that the construction least favourable to the person putting forward an instrument should be adopted against him."

(32) It follows that as the instrument was drafted by the Government, any ambiguity should be resolved in favour of Mr Farrell. The two clauses are in conflict and therefore 4[a] should be ignored and 1[a] relied upon.

(33) The actions of Mrs Napier on 1 February, and subsequently, were contrary to ILO Convention 158 and in particular the absence of procedural fairness. Mr Farrell was not given any advance warning as to the subject matter of the meeting and was therefore denied the opportunity to prepare his response. He was not consulted on the proposed restructure nor was he given an opportunity to demonstrate his own capacity to perform in the restructured role. He was effectively presented with a fait accompli and talks or exchanges after the event could not be construed as consultations as the Commissioner seemed to suggest.

(34) The letter of 2 February was no more than a statement of intent that something would happen in the future and the law distinguishes between an intent and the actual implementation of that intent. Mrs Napier did not have the power to implement a termination as the Instrument of Appointment made it clear that it was only the Premier, or his delegate, who had such authority. A notice of intention to do something carries no weight unless that person has the power and authority to deliver on that intention. Moreover the letter did not give any reasons for his termination.

(35) It was not the actions of Mrs Napier which were important but rather the actions of the Government, and in particular the role of the Premier. There can be no doubt that the Government perceived itself as Mr Farrell's employer as evidenced by the rejection of his application for unpaid leave.

(36) The Crown had a clear duty of care to ensure that the termination was fair and reasonable and in accordance with the law and the Instrument of Appointment. This would involve ensuring that the office restructure was genuine, that there was a revised Position Description, and then an assessment as to whether Mr Farrell was capable of filling that role. This did not occur and the Commissioner fell into error because she did not assess whether the Premier had exercised a proper duty of care.

(37) Because this case involved two political parties who are diametrically opposed, then the formalities ought to be observed with scrupulous care. There is no room for error or the tiniest bit of uncertainty. Mr Farrell expressed it in these terms:7

"What is then required for acceptability? When a Labor Premier or the politically appointed head of his department terminates the employment of a staff member of the State Liberal Opposition, using a power which he, the Premier, sought and obtained for himself from the Governor, a process of the termination must be as smooth as silk. It has to be squeaky clean. It has to be of crystal clear transparency. It must be completely and rigorously accounted for - there must be full justification of the steps. Why? Because in these circumstances, in these most unusual bizarre political circumstances, if there is anything hidden or unaccounted for in the process - if there is anything coarse or that doesn't fit fairly and snugly with the rules, then someone just might get the whiff of unfair process."

(38) It followed that any tribunal to be scrupulously fair should err on the side of the weaker party in the proceedings.

(39) The Commissioner erred in finding that there had been no breach of procedural fairness.

(40) The Commissioner erred in that the whole tenor of the decision was that Mrs Napier had the authority to terminate Mr Farrell's employment. Any deficiency in the process is the responsibility of the Government, not Mrs Napier.

(41) Employers, including political leaders, do have the right to choose who they wish to employ. They do not, however, have the right to fire people for no apparent reason. The law relating to termination of employment applies, not just the Instrument of Appointment. If there were different rules applicable to Mr Farrell's contract of employment, they would have been spelt out in the Instrument of Appointment. The Commission erred in not concluding that Mr Farrell's rights as an employee were protected and should have been applied by the Government.

(42) The decision was defective in that it does not explain why it has apparently chosen to give little weight to some aspects and heavy weight to others. To use the term "in all the circumstances" is not good enough.

(43) The decision contained a number of inconsistencies or factual errors. The following are examples:

  • The decision dismisses as hearsay evidence Mr Farrell's sworn statement as to what certain members of the Liberal Party had told him yet accepted what amounts to hearsay evidence in the letter from Ms Hornsey and his own letter of 13 February to Mrs Napier.
  • The Commissioner's conclusion that Mr Farrell knew that he was going to be terminated five months prior to the actual termination8 was untrue in that he was only given six or seven days' notice.
  • The Commissioner misinterpreted Mr Farrell's statement about his employment coming to an end on 1 June 2001.9
  • The Commissioner said on the one hand that the door was open to have the decision changed yet at the same time the Commissioner had concluded that Mr Farrell had been advised in "clear and unequivocal terms" that the employment would come to an end. This is inconsistent.
  • The Commissioner was wrong in stating that Mr Farrell had been appointed as an economist. He had in fact been appointed as an Adviser.
  • The Commissioner was wrong in stating that Mr Farrell gained an extra month's employment at his request. He had applied for leave without pay which was rejected. He was effectively sent off on annual leave without any consultation.
  • The Commissioner was wrong in finding that Mr Farrell was not treated in a humiliating manner.10

(44) The 2 February letter from Mrs Napier was vague and equivocal in that it did not specify when and what action would be taken by whom to terminate Mr Farrell's employment. In fact there is no evidence that Mrs Napier ever did take action to terminate his employment. Even if she had done so, there was no certainty that the employer (the Government) would have accepted Mrs Napier's recommendation.

(45) The Commissioner erred in not putting the onus firmly on the Government [as the employer] to show that the termination was fair.

The Key Issues

(46) The original application and this appeal turn on a number of critical issues. In this section we identify and consider these key questions.

1. Who was Mr Farrell's Employer?

(47) There can be no doubt that the decision to terminate Mr Farrell's services was taken and initiated by Mrs Napier.

(48) Mr Farrell's Instrument of Appointment was signed by the Governor. Clause 4[a] of this document states:

"4[a] The appointment may be terminated by the appointee or by the Premier, or his delegate, upon two weeks notice in writing to the other."

(49) Mr Farrell submitted that his employer was clearly the Crown, meaning either the Premier or his delegate. Mrs Napier did not have the power to terminate his services and Commissioner Shelley was wrong in finding that she did have such power. It followed that the Crown had a clear duty of care to ensure that the termination was fair and reasonable and in accordance with the law and the Instrument of Appointment.

(50) Relevant to this question Commissioner Shelley said:11

"From the final result (which was termination), it is evident that Mrs Napier had the authority to commence the process which would lead to the termination of Mr Farrell's appointment. It was not put to me that Mrs Napier did not have the authority to do so, or was not delegated to do so (although Mr Young did, in the course of objecting to a question, state that Mrs Napier did not have the power to terminate).12"

(51) In dealing with this question Commissioner Shelley was required to have regard for the ILO Convention together with the underpinning notion of a fair go all round. In our view the Commissioner was correct in finding that Mrs Napier had the authority to commence the process. Mr Farrell is also correct in his contention that only the Premier [or his delegate] could formally terminate his employment.

(52) The question before Commissioner Shelley was not one of who was the employer in a strict legal sense, but rather, whether Mr Farrell was unfairly dismissed. In our view the over-riding consideration must be the realities of the employment arrangements.

(53) Even if we accept that in a strict legal sense Mr Farrell's employer was the Premier, the reality is that he took his day-to-day work instructions from Mrs Napier. He would not have been employed in the first instance if Mrs Napier [or her predecessor] had not taken the initiative to do so. Mr Farrell would not be terminated if Mrs Napier had not initiated the action.

(54) For the Premier to inquire into the veracity of the office restructure and the revised Position Description, and then assess Mr Farrell's suitability for the position, not only flies in the face of reality, but could also give rise to a major political incident.

(55) In assessing whether Mr Farrell's termination was unfair, the over-riding consideration must be the actions taken by, and the behaviour of, Mrs Napier.

2. Is There Ambiguity in the Instrument of Appointment?

(56) Clause 1[a] of the Instrument of Appointment reads as follows:

"1(a] The appointment shall be for a term expiring on the thirty-first day of October two thousand and two or on the resignation or other termination of the Government whichever shall occur earlier (hereinafter called 'the termination date']."

(57) Clause 4[a] of the same document reads:

"4(a) The appointment may be terminated by the appointee or by the Premier, or his delegate, upon two weeks notice in writing to the other."

(58) Mr Farrell submitted that there is a clear ambiguity between these two clauses and in accordance with the doctrine of contra preferentum, any ambiguity should be resolved in his favour. Indeed Mr Farrell asserted that we should ignore clause 4[a] and rely on 1[a] alone.13

(59) To adopt Mr Farrell's position of ignoring 4[a] would of course lead to the untenable position whereby Mr Farrell's ability to resign his own position on the giving of two weeks' notice would be removed. This clearly would be contrary to the intent of the contract as freely entered into by the parties.

(60) We do not consider there is any ambiguity between the two clauses. We concur with the finding of Commissioner Shelley14 whereby she said that the term of appointment in clause 1[a] does no more than state the maximum duration of the contract. When that event occurs, the contract automatically comes to an end without any action required on the part of the employer. Clause 4[a] sits quite comfortably in that it simply allows either party the option to terminate the contract part way through the term specified in Clause 1[a]. Where the termination is initiated by the employer, a severance payment is also required.

3. Does the Commission Have Jurisdiction to Enforce the Terms of the Instrument of Appointment?

(61) Much of the argument at first instance revolved around alleged breaches of the Instrument of Appointment and administrative procedures arising from this document. The question of unfairness was raised by the applicant very late in the proceedings, largely in response to questioning from Commissioner Shelley.

(62) In these proceedings Mr Farrell submitted that "fairness" does not have a dimension. It is either fair or it is not fair and there is no middle ground. He instanced the fact that the formal notice required by the Instrument of Appointment fell short by approximately one week. This was both unfair and meant that the contract was a nullity. It followed that damages were at large.

(63) In the earlier proceedings counsel for Mr Farrell contended that in such circumstances the appropriate remedy would be payment of salary for the balance of the contract, plus a component for loss of opportunity to renew the contract. In the case of Mr Farrell this amounted to a sum in the order of $200,000.

(64) The notion of a quite minor administrative breach leading to damages being at large is something which is quite foreign to this jurisdiction. Commissioner Shelley found that the enforcement of the Instrument of Appointment was outside the jurisdiction of this Commission. We agree with this finding. This does not mean that the Commission could not deal with an industrial dispute, an element of which is an alleged breach of the Instrument of Appointment. Indeed Commissioner Shelley did just this in ordering, pursuant to s.31[1], that an amount equivalent to one week's pay be made in settlement of the shortcoming in the formal notice given.

(65) We do not accept Mr Farrell's submission to the effect that there are no degrees of fairness. This Commission will for example view a minor and inadvertent procedural defect quite differently from, say, a gross denial of natural justice and will structure its remedies accordingly.

(66) To a point there is some force in Mr Farrell's contention that, but for the unfair act, it is impossible to know what the outcome might have been. It is not difficult to envisage a situation whereby a minor administrative oversight might lead to a grossly unfair outcome. However we can only deal with facts of the given situation. In the instant case the administrative breach amounted to less than the required formal notice being given. We are quite satisfied that this administrative shortcoming did not in any way impact on the final outcome, that being the termination of Mr Farrell's contract of employment.

4. Was Mr Farrell Given Reasonable Notice of Termination?

(67) The crux of this question is Mr Farrell's contention that notice of an intention to do something is not the same as actually doing it. He argued that Mrs Napier's letter of 2 February was no more than a statement of an intention to do something in the future. He asserts that there was no evidence that Mrs Napier ever actually did anything to activate this intention. We are unable to accept this. The letter from Ms Hornsey of 22 June did not materialise in a vacuum. Clearly Mrs Napier took some action at some point in time to give effect to her earlier stated intention.

(68) Even allowing for what he saw as the defective nature of the 22 June letter, Mr Farrell contended that at best he was only given six or seven days' notice and the termination was therefore unfair.

(69) On this question Commissioner Shelley said:15

"In my view, the ILO Convention requirement for a worker to be given a reasonable period of notice applies to the commonsense every day understanding of what notice is. It is something that happens that puts someone on notice that something else is going to happen. It should not be vague or equivocal. It should clearly specify what it is that is going to happen. Most importantly, the worker must be aware that they have been given notice, or, as in the case of constructive notice, the accompanying circumstances must be such that the knowledge of the notice can be imputed to the worker.

In my opinion, the letter of Mrs Napier to Mr Farrell on 1 February 2000, was very clear notice that his employment would come to an end on 1 June 2000 (later changed at Mr Farrell's request to 3 July 2000)."

(70) Later in the decision the Commissioner identified a number of examples from the evidence indicating that Mr Farrell accepted that his employment would be terminated.

(71) In the hearing before Commissioner Shelley Mr Young said:16

"Commissioner, it's not disputed that Mr Farrell had an expectation that his contract would be terminated on 1 June. That's not disputed."

(72) Whilst we accept that a distinction can be drawn between a statement of an intention to do something and actually doing it, the weight that should be given to this distinction must inevitably turn on the facts of any given situation. Importantly in this case there is no evidence at all that Mrs Napier at any stage between February and June 2000 may have been reconsidering the position.

(73) We conclude that the approach and finding of Commissioner Shelley was correct and properly applied the provisions of the ILO Convention.

5. Was There Any Inconsistency in the Treatment of Hearsay Evidence?

(74) Under the heading of "Other Issues" Commissioner Shelley expressed the view that comments attributed to certain members of the Liberal Party were hearsay only, and not relevant to the industrial questions to be decided.

(75) Mr Farrell contended that the Commissioner was inconsistent in that she accepted, without supporting evidence, the word of Ms Hornsey to the effect that the Premier had approved the termination [letter of 22 June]. Mr Farrell also instanced the acceptance of his own recollection of the 1 February meeting with Mrs Napier [see letter of 13 February].

(76) In our view it was the two letters, rather than the comments contained therein, which Commissioner Shelley accepted into evidence. This is quite different from accepting as evidence comments which certain members of the Liberal Party had purportedly made. The veracity or otherwise of the contents of the letter is another question. The degree to which a Commissioner should pursue supporting evidence will depend on the substance of any challenge and the relative importance of the issue.

(77) In relation to the Hornsey letter, there was no evidence either way as to whether the Premier had approved the termination, and Commissioner Shelley said that as Ms Hornsey was the most senior officer in the Department of Premier and Cabinet, it was reasonable to assume that the Premier had instructed her to issue the notice of termination. In relation to Mr Farrell's own recollection of events, no challenge had been issued by anyone as to their accuracy. In the circumstances we find that the approach of Commissioner Shelley to these issues was reasonably open to her.

(78) We conclude that the Commissioner did not fall into error or apply an inconsistent approach in relation to the consideration of hearsay evidence.

6. What was the status of Mr Farrell's employment during the period 2 June to 3 July 2000?

(79) By letter of 9 May Mr Farrell repeated his earlier request for leave without pay for the above period. The evidence suggests that Mrs Napier initially approved this application. However on 25 May Mrs Napier wrote to Mr Farrell in the following terms:

"I refer to my letter of 2 February, 2000 in which I indicated to you that your employment would be terminated in accordance with Clause 4(a) of your Instrument of Appointment with effect from 1 June 2000. I refer also to recent discussions in respect of leave which you have requested.

I confirm that, in accordance with your wishes, I am prepared to extend your period of employment until 3 July 2000 and will advise the Premier, as your employer, accordingly. The reasons for the termination of your employment and details of termination payments are as specified in my letter of 2 February 2000.

In relation to your request for leave without pay for the period 2 June 2000 until 3 July 2000, I have been advised by the Acting Director Corporate Services of the Department of Premier and Cabinet that approval of leave without pay in these circumstances is contrary to Departmental policy.

That policy stipulates that recreation leave credits must be utilised prior to the granting of leave without pay. In your particular situation it appears that you have sufficient recreation leave credits to cover your proposed period of leave. The policy can be waived in exceptional circumstances but in the absence of such circumstances you will be required to use your recreation leave credits. I therefore request you provide details of any such exceptional circumstances or if there are none, that you submit an application for recreation leave for the above period, if that is still your wish."

(80) In our view the extension of the period of employment was entirely conditional on Mr Farrell either providing details of "exceptional circumstances" or submitting an application for [paid] recreation leave. Mr Farrell chose to do neither but proceeded to travel interstate with his family in any event.

(81) In the circumstances we consider that the subsequent treatment of this period as paid recreation leave is not unreasonable.

7. Was Mr Farrell Denied Procedural Fairness?

(82) On this question Commissioner Shelley found as follows:17

"The evidence was that he was given clear reasons for his dismissal, and ample opportunity to try to persuade Mrs Napier to reconsider her decision. The evidence also showed that Mr Farrell did not indicate that he intended to challenge the decision to terminate until after the date of the termination - not until 5 July 2000.

I therefore consider that there was no breach of procedural fairness in this respect."

(83) In the proceedings before this Bench Mr Farrell contended that procedural fairness had been denied in that he had no advance warning, was not consulted on the restructure which was presented as a fait accompli, and was not given the opportunity to apply for the new position.

(84) In the normal course of alleged unfair dismissal applications, a submission along these lines would have considerable force. We also accept that the existence of Clause 4[a] in the Instrument of Appointment does not mean that the employer may act without reason and ignore procedural fairness.

(85) Procedural fairness must of course be judged in the context of the environment in which the employment contract subsists. The standards of procedural fairness may well be different for a short term casual employee than it would for an employee of long standing with a soundly based expectation of ongoing employment until retirement. This is particularly so in respect of prior consultation. This was acknowledged by Commissioner Shelley when she said:18

"I also accept, to a certain extent, the submissions of Mr Willingham, (which were not challenged by Mr Young), that in the case of a person employed in a sensitive political environment at a high level, the circumstances are somewhat different to those of an "ordinary" worker, and that the Leader of the Opposition has a right to determine who his/her advisers should be, and the nature of the advice they require. However, I do not consider this to be an unfettered "right". In my opinion, it would still be necessary, even at that level, to provide a reason for the termination of an employee's employment, and it would need to be a valid reason, as has been demonstrated in this case."

(86) Arguably this very issue appears to be contemplated in the Instrument of Appointment in that a severance payment automatically applies when notice of termination is given. This is not something which is widely found in contracts of employment applying in more "normal" workplaces.

(87) A further difficulty is that the aspects of procedural fairness advanced by Mr Farrell in the appeal proceedings appear to have been barely touched upon in the original hearing. Indeed Mr Young said:19

"And one could be flabbergasted about the unfairness of the change of the structure, but it is no doubt Mrs Napier and the Liberal Party's purview to say what sort of advisers they want. It's the nature of political parties. They're entitled to all sorts of advisers that might get their number up in the polls."

(88) We have little doubt that Mr Farrell told Mrs Napier that he considered her decision to be unfair. We are however unable to find where the submissions put to this Appeal Bench were made to Mrs Napier. Mr Farrell's letter of 13 February consists of a re-statement of what had occurred at the 1 February meeting. It did not challenge the validity of the termination or seek the opportunity to be considered for the restructured role. Indeed Mr Farrell agreed that this letter did not challenge the validity or the justness of the decision to terminate his employment.20

(89) That Mr Farrell did not wish to "rock the boat" whilst he was still in employment is understandable. Nonetheless, on the material that is before us, Mrs Napier could quite reasonably have been of the view that Mr Farrell, whilst unhappy with the turn of events, accepted the validity of the decision.

(90) In all the circumstances we conclude that the approach and finding of Commissioner Shelley on this question was reasonably open to her.

Conclusion

(91) We are unable to conclude that any of the grounds of appeal have been made out.

(92) Pursuant to Section 71[13] of the Act, the appeal is dismissed and the decision of Commissioner Shelley is confirmed.

 

P L Leary
PRESIDENT

Appearances:
Mr K Farrell representing himself.
Mr C Willingham for The Crown in Right of State of Tasmania, Department of Premier and Cabinet, Office of the Premier.

Date and place of hearing:
2001
July 25
Hobart

1 T9147 of 2000
2 Original decision p. 3
3 Martin v Tasmanian Development and Resources, Federal Court, 1999 FCA 593
4 Original decision p. 32
5 Exhibit Y1J
6 Transcript para 660
7 Supra para 3545
8 Original decision p. 30
9 Supra p. 19
10 Original decision p. 28
11 Supra p. 30
12 Transcript T9147 21/9/00 p. 50
13 Transcript para 955
14 Original decision p. 28
15 Original decision p. 29
16 Original transcript p. 56
17 Original decision p. 31
18 Original decision p. 26
19 Original transcript p. 81
20 Supra p.64