Department of Justice

Tasmanian Industrial Commission

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

T294

     

    IN THE TASMANIAN INDUSTRIAL COMMISSION

    Industrial Relations Act 1984

     

T.No. 294 of 1985 IN THE MATTER OF a referral by the Department of Labour and Industry pursuant to Section 13(2) of the Long Service Leave Act 1976 of a dispute between Cadbury Schweppes Pty. Ltd. and Mr. K. F. Cunningham
   
  Re : Long Service Leave entitlement
   
DEPUTY PRESIDENT ROBINSON HOBART, 3 June 1986
   

REASONS FOR DECISION

 
  APPEARANCES:  
   
For Cadbury Schweppes Pty Ltd - Mr. L. Potter
  and Mrs J. Enright
   
Mr. K. Cunningham - in Person
   
For the Department of Labour and Industry - Mr. J. Wyton
   
DATES AND PLACE OF HEARING -  
   
5 March 1986           Hobart  
18 March 1986         Hobart  
   

This matter concerns a dispute in relation to a claim for payment of pro-rata long service leave by Mr. K. F. Cunningham against Cadbury Schweppes Pty. Ltd. of Claremont on the basis of his voluntary termination of services through alleged "domestic or other pressing necessity".

The matter was referred to the Commission as a dispute by the Secretary for Labour pursuant to the provisions of Section 13(2) of the Long Service Leave Act, 1976.

Mr. Cunningham was continuously employed from 25 February 1974 to 23 January 1985 inclusive - a period of 10 years, 11 months and 1 day. At the time his services concluded, he was classified as a fork lift truck driver and paid a weekly wage of $308.40.

The claim in money terms amounts to $2918.54.

The essential facts were presented to the Commission by Mr. J. Wyton, the investigating officer concerned, following the making of a complaint to the Department of Labour and Industry on 23 August 1985.

Both parties were given full opportunity to hear Mr. Wyton's report and cross-examine him as to matters of fact .

Subsequently Mr. Cunningham presented his own case, which was supported by the giving of sworn evidence by one witness and the production of two signed, unsworn written statements.

Mr. Potter opposed the claim by way of submissions, 2 exhibits which were staff notices issued by the Company and his own affirmation of relevant facts known to him personally.

Mr. Cunningham's claim is predicated upon the following facts:

- His marital circumstances changed as from March 1983 and he and a "permanent/temporary" employee of Cadbury/Schweppes (hereinafter referred to as Mrs. K.) set up house together.

- Mr. Cunningham and Mrs. K. were jointly committed to heavy financial obligations, including Mr. Cunningham's maintenance payments to his former wife.

- In December 1984, the then employment officer of Cadbury/Schweppes, a Mr. John Adkins, told Mrs. K. that she would not be required back again next year (1985) following the installation of certain new machinery.

- The same information was separately given to Mr. Cunningham, who said he had spoken to Mr. Adkins on several occasions regarding Mrs. K.'s continued employment and was told Mrs. K. would not be back in 1985.

- This is consistent with what was told to others and two employees signed an unsworn statement which said:

    "John Adkins told me and others that we would not be required when the new room started production in the New Year, 1985."

Each statement was headed:

    "Re Temporary Workers Cadburys."

- Being convinced that Mrs. K. would not be re-employed the following year, and as a consequence they could not meet their financial commitments, Mr. Cunningham sought alternative, higher paid employment.

- He was successful in obtaining a position with Electrolytic Zinc Company of Australasia Ltd. at a weekly income of approximately $355 gross.

- Prior to his termination of services on 23 January 1985, Mr. Cunningham's weekly wage at Cadbury/Schweppes was $308.40.

Cadbury/Schweppes opposed the granting of the claim on the basis that the essential facts are contested and consequently the reasons for Mr. Cunningham leaving his employment do not constitute "pressing or other domestic necessity."

In summary, the employer relies upon the following:

- Mr. Cunningham ascertained that he was not entitled to pro-rata long service leave before he resigned.

- The employee elected to leave Cadbury/Schweppes when at the time -

    (a) his base salary was $308.40;

    (b) his average salary was $360 per week with overtime;

    (c) he was able to earn an extra $80.00 (on an irregular basis) playing in a band;

    (d) his combined income was therefore $440 per week.

- Mr. Cunningham went to another position at the Electrolytic Zinc Company of Australasia Ltd. where his ordinary wage was only $229.70 per week, or $334.00 including overtime and shift loadings.

- In 1983 Mr. Cunningham and Mrs. K. changed there place of residence from Claremont to New Norfolk. The additional expenditure incurred in travelling to E.Z. Company instead of Cadbury/Schweppes amounted to an estimated $31.00 per week.

- Mr. Cunningham applied for re-employment with Cadbury/Schweppes in August 1985 and March 1986, despite the fact that his financial and domestic circumstances were essentially the same at the time when he left.

- Mr. John Adkins, former Employment Officer for Cadbury/Schweppes (now located in London) recently told Mr. Potter by telephone that he had not said to Mrs. K. or anyone else that she would not be reemployed in 1985.

- Mr. Adkins had no different information to that known to the Supervisor or Mr. Potter at the relevant time and it would not have been consistent with the facts to have said such a thing.

- Mrs. K. has been employed as a "permanent part-time" for a number of years and enjoyed a right to preference in employment when work exists each year.

- As it eventuated, Mrs. K. was re-employed in 1985 for a good period of time, i.e. seven (7) months.

    In addition, 117 new temporaries were taken on in that year.

- Employment of temporary staff was not restricted to the Assortments Section where Mrs. K. had usually been employed.

- Mrs. K. was not sufficiently concerned about the joint financial situation of both partners in January 1985 to seek alternative employment at that time.

- Mr. Cunningham admits seeking alternative employment before Mrs. K. finished up in December, 1985.

During the course of the hearing, considerable detail was entered into and I assure the parties that even though I have not committed all of such detail to writing, it has certainly not been overlooked.

Mr. Cunningham did for instance testify that whilst his base pay at E.Z. Company was low, he had been led to believe from enquiries made that -

    "men at E.Z. are earning $20,000; $22,000; $24,000 per year or whatever amount of overtime you want."

(transcript page 29)

Furthermore the circumstances which prevented him achieving his earnings goal were that he contracted dermatitis and was transferred to the store and received no overtime for a period of time.

Decision

For the claim to be sustainable, I need to be satisfied that the evidence produced proves, on the balance of probabilities, the circumstances fall within the criteria of Section 8(2)(e) of the Long Service Leave Act, 1976.

The Act gives an entitlement of pro-rata long service leave to an employee who has been continuously employed for a minimum of seven (7) years and who is, quote:

    "(c) an employee who terminates his employment on account of incapacity or domestic or other pressing necessity of such a nature as to justify the termination of that employment..."

Both parties placed a good deal of reliance upon the validity of the allegation by Mr. Cunningham that both he and Mrs. K. were told by Mr. Adkins, the then Employment Officer of the Company, that Mrs. K. would not be employed by Cadbury/Schweppes in 1985.

Support was given to this allegation by two unsworn signed statements.

The claimant, Mr. Cunningham, presented as a truthful person who gave his testimony in a forthright manner. In addition, his employer willingly volunteered that this man had a good work record and was well respected.

I found it refreshing that Mr. Cunningham was prepared to recognise and acknowledge that, with the benefit of hindsight, he had made an error in terminating his services with Cadbury/Schweppes.

Mrs. K. gave sworn evidence that she was definitely told by the Company's Employment Officer, Mr. John Adkins, that she would not be back in 1985. No amount of cross-examination could shake that testimony.

The balance of supporting evidence was two unsworn statements from employees who did not appear in person.

This later type of evidence was of little, if any, benefit as it carried virtually no weight so far as I am concerned. The Commission has a wide discretion to inform itself as best it can, but simply put, one cannot cross-examine or observe the demeanour of a piece of paper, and as a consequence many questions necessarily remain unanswered.

Cadbury/Schweppes were in the unfortunate position of not having their principal witness in this country and whilst the Commission was sympathetic to their difficulty and said it was prepared to allow reasonable time to produce this witness, the reality was that this was impracticable.

In these circumstances, I accept the hearsay evidence of Mr. Potter, as a reliable witness himself.

To be consistent, however, I must say that this type of evidence carries lesser weight than best evidence for much the same reasons.

Even though the Commission operates as a lay jurisdiction and admits hearsay, it must be understood that where evidence conflicts, then more weight attaches to best evidence than hearsay.

Given the paucity of hard evidence, it would be fair to say Cadbury/Schweppes relied heavily upon the logic of sequential facts to prove their argument.

On the evidence before me I can reach no other conclusion than that, during December 1984, Mr. Cunningham and Mrs. K. were justified in concluding that the latter would not be required back at work as a part-time employee.

Having reached this finding, the fact that Mrs. K. was subsequently re-employed becomes irrelevant.

Mr. Cunningham was obliged to make a decision based upon facts made known to him at the relevant time. If the information was later proven to be wrong or was conveyed in a way which gave the wrong impression then that is beyond the point.

In any domestic circumstances, the loss of income which was being relied upon would have an impact, and it follows that the larger the sum concerned, the greater the impact. In this regard, Mrs. K. had worked approximately 9 1/2 months during 1984 and whilst it was not disclosed what her earnings were during that year, the fact that she worked 36 hours per week and was paid $269.90 per week in 1985, demonstrates well enough the significant order of loss of income.

Details of Mr. Cunnigham's heavy financial commitments at the relevant time were provided to the hearing and were not disputed. I am satisfied that the extent of those commitments represented a financial burden of some magnitude.

Clearly the dilemma created by such financial difficulty had been painfully evident to the couple for some time and was no doubt why Mr. Cunningham had been making a number of job enquiries before December 1984, when rumours of job cut backs had been circulating.

When these rumours were confirmed so far as he was concerned by the events of December 1984, Mr. Cunningham made a conscious decision to leave Cadbury/Schweppes for a "better paid" job.

It is now beyond question that the claimant's decision to resign and take another job to earn more money was a disastrous mistake. Not only did he fail to achieve a superior income, but he did not even maintain the income that he had before. In fact his income was significantly reduced as a result of his changed jobs and at one stage it appeared he may end up jobless.

It would be easy to conclude that events have proven that it was not "necessary" for Mr. Cunningham to terminate his services at the relevant time, but rather that his financial and domestic circumstances made it necessary that he stay on with his existing employer.

However, in mitigation some allowance must be made for the fact that Mr. Cunningham's plight was exacerbated by loss of wages after he contracted dermatitis in his new employment - an event which would have been extremely difficult to predict.

Before this event occurred, however, Mr. Cunningham's ordinary rate of pay at E.Z. Company was appreciably below that which he was receiving before he resigned from Cadbury/Schweppes, i.e. $229.70 compared to $308.40. Even if one takes at face value the hearsay evidence that considerable overtime was available to those who wanted it, it is obvious that the lower ordinary rate would make it extremely difficult to achieve a better gross pay overall.

The evidence of the Department of Labour and Industry Inspector, Mr. Wyton, based upon statements made to him by Mr. Cunningham on 23 August 1985 was that Mr. Cunningham had already bettered his financial status by changing his employment.

At page 5 of transcript Mr. Wyton said, inter alia:

    "Mr. Cunningham was successful in obtaining a position with E.Z. Company at a weekly income of $355.00,some $46.60 per week increase on his normal wage on termination at Cadbury/Schweppes."

But later at page 6 doubt was cast upon the accuracy of Mr. Cunningham's statement following subsequent investigation:

    "It is claimed by Cadbury/Schweppes that Mr. Cunningham's average weekly income from June 1984 to termination amounted to $360.00."

It was not contested before me that Mr. Cunningham received overtime at Cadbury/Schweppes and averaged $360.00 per week as a result.

Subsequently it was confirmed during the course of the hearing that Mr. Cunningham's commencing salary was not $355.00 as stated to the Department of Labour and Industry but only $229.70 per week. Even with shift and other penalty rates, the expected maximum wage became only $334.00.

This was brought out under cross-examination of Mr. Cunningham by Mr. Potter at pages 28 and 29:

    "Mr. Potter:
    Nonetheless, you opted to terminate your employment knowing full well that your commencing salary at E.Z. would be $229.70 and your expectation at that time was $334.00.

    Mr. Cunningham:
    Yes, with overtime and shift work penalty allowances.

    Mr. Potter:
    So in fact you opted to go to a job which was lesser paid ...

    Mr. Cunningham:
    Less base rate of pay but picked up in other areas."

Even if allowance is made for some measure of error and the highest level of weekly income achieveable through shift and penalty rate additions was $355.00 per week as told to the Department of Labour and Industry, and not $344.00, as suggested by Mr. Potter, both figures are below the figure of $360.00 which was average at Cadbury/Schweppes in the period up to 23 January 1985, when Mr. Cunningham left that employer.

On the question of comparable wage levels present and past, supplied to the Department of Labour and Industry by the claimant, the figures presented gave a false picture because Mr. Cunningham's statement created the impression that he was justified in the action he took at the time he resigned and that this was supported by subsequent events.

The explanation provided by Mr. Cunningham during the hearing that the minimum or ordinary rate at Cadbury/Schweppes was used to compare with the maximum received at E.Z. Company, is not satisfactory. Clearly like must be compared with like if a true picture is to be presented.

In my view for the claim to succeed, the claimant would need to be able to demonstrate that he left his employment through real domestic or other pressing necessity of such a nature as to justify the termination of that employment.

It is not sufficient merely to show that the perceived circumstances were such that it was thought to be a good move to leave. It must have been reasonably necessary in all of the circumstances based upon sound facts.

In many ways the action of Mr. Cunningham can be more appropriately described as a rather unfortunate and illconceived leap in the dark than that of necessity.

His decision was largely speculative and was proven to be too wide of the mark to be sustainable. A more prudent person would have sought confirmation of information before making a final decision in such a vitally important matter as job change .

If Mrs. K. was not likely to be re-employed by Cadbury/Schweppes (or even employed for a shorter period of time than normal) during 1985, then Mr. Cunningham's decision to resign in order to take another position which paid $70.70 per week less as an ordinary rate of pay was clearly unsustainable. It was an error of judgement to expect that shift loadings and overtime would boost the take-home pay to the extent needed to justify the decision to resign.

If financial problems were of such a magnitude as presented, it is also difficult to comprehend how Mr. Cunningham would readily forego the opportunity to earn $80.00 per week, even irregularly, by playing in a band, or to a lesser extent, incur extra travelling costs by taking a job farther from home.

In all of the circumstances, I am unable to find that the claimant has discharged the onus of proving domestic or other pressing necessity of such a nature as to justify his claim.

Accordingly the claim is dismissed.

 

A. Robinson
DEPUTY PRESIDENT