The Fair Work Commission’s decision in Sathananthan v BT Financial Group Limited should be of interest to any employer whose employees say that they are overworked or that their allegations of misconduct aren't being taken seriously. 

Mr Sathananthan was employed as a Business Development Manager for BT. On 12 March 2019, he resigned. His last day at BT was 12 April 2019.

Mr Sathananthan then made an unfair dismissal claim. He claimed his resignation was forced by his treatment by BT. In particular, he alleged that BT failed to:
 
1. Take steps to manage his workload in circumstances where he was overworked
 
2. Investigate allegations of misconduct he made against a colleague.
 
The Commission accepted that Mr Sathananthan often worked over 70 hours per week and that he had repeatedly raised this issue – and the effect it was having on his health – with his people leader. While his people leader took some steps to arrange further support for Mr Sananthan, the Commission found no significant changes were made to his role or responsibilities.
 
The question of how allegations of misconduct made by Mr Sathananthan were managed was more complex.
 
Mr Sathananthan and a female colleague (who was not identified in the decision) had a consensual relationship between December 2017 and April 2018. After the relationship ended, the working relationship between the two of them became strained. Both employees made allegations against each other.
 
The female colleague’s allegations against Mr Sathananthan were formally investigated by BT’s Human Resources team. Most of those allegations were found to be unsubstantiated and no formal disciplinary steps were taken against Mr Sathananthan.
 
Mr Sathananthan’s allegations against his female colleague were not treated the same way. BT explained one reason for this was that his allegations raised performance, rather than misconduct, issues. The Commission described this assessment as “questionable”. BT also decided that it could not investigate some of his allegations because they were personal matters outside the scope of the female colleague’s employment. The Commission found that, while that view may have been justified, BT did not demonstrate that it had properly considered the connections between the conduct alleged and the workplace. Further, the Commission found that BT did not properly communicate its views to Mr Sathananthan.
 
In the circumstances, the Commission found that Mr Sathananthan had "no effective or real option but to resign his employment from BT".

Commissioner Hampton stated:
 
"the combination of the excessive working hours and the absence of any real recognition of this issue or steps taken by BT to manage this, combined with the absence of any indication that BT intended to investigate or deal with those conduct matters raised by Mr Sathananthan concerning [his female colleague] that were capable of directly impacting upon the workplace, are particularly influential in the assessment as to whether that resignation was forced. I add that it is only the combination of these events, and the working hours in particular, rather than the treatment of the Applicant’s concerns about the [the female colleague’s] conduct in isolation, which has led to the requisite finding." 
 
The Commission found that Mr Sathanathan was unfairly dismissed. Mr Sathananthan did not seek re-instatement and was awarded compensation of approximately $46,000.

Two recent Fair Work Commission decisions have looked at whether a dismissal for operational reasons was unfair - and come up with different answers.

In Arnold v Real Estate Mt Hawthorn Pty Ltd, Mr Arnold was an estate agent employed on a commission-only basis.

In 2018, the relevant award was amended to exclude commission only positions. The effect of that change was that Mr Arnold would then have to be paid a salary regardless of whether or not he made any sales.

Partly because of that change, and partly because of a real estate downturn in Western Australia, Mr Arnold's employer decided to change the focus of the business to real estate management – which would reduce the need for agents who concentrated on sales.

On 10 April 2019, the employer met with Mr Arnold and discussed the effect of these changes. The employer told Mr Arnold that his employment would end and the parties agreed that Mr Arnold’s last day would be 12 April 2019.

Later that day the employer sent Mr Arnold a dismissal letter. In that letter, the employer noted that the decision did not reflect adversely on Mr Arnold’s performance and offered to give him a reference to help him find a new job.

Mr Arnold then made an unfair dismissal claim.

Although Mr Arnold’s role was, in the employer’s mind, redundant, the employer failed to consult with the affected employee as required by the award. Accordingly, the Commission found the situation was not a “genuine redundancy” for the purpose of the Fair Work Act.  

However, the Commission nevertheless decided that the dismissal was not, in all the circumstances, unfair.

The Commission stated:

"[The employer] failed to fully comply with the consultation provisions set out in the relevant Award. I am satisfied that he did so as a consequence of a lack of human resource expertise. There is no evidence that compliance with the consultation provisions would have led to any different outcome. [The employer] took a variety of steps to avoid the redundancies. He explained in detail the steps he had taken and the reasons why he believed the retrenchment was necessary. He endeavoured to assist Mr Arnold secure alternative employment including offering to provide a reference.
Having regard to all the evidence before me, while [the employer] should have more fully consulted with Mr Arnold, I am not satisfied that the failure to meet the consultation obligation in the Award is significant in the overall context of determining whether the termination was harsh, unjust or unreasonable. I find that more extensive consultation would not have altered the outcome arrived at by Oxford. The absence of consultation in accordance with the Award means the redundancy was not a “genuine redundancy”, but it was not so serious a procedural deficiency to support a conclusion that the dismissal was harsh, unjust or unreasonable."

In Raftery v Heng Rui Pty Ltd www.austlii.edu.au/cgi-bin/viewdoc/au/cases/cth/FWC/2019/6919.html the employee worked at the Sonder Café.
On 21 May 2019, there was a change in the ownership of the café’s business.  It seems that, immediately after the change in ownership, the new owner decided that there needed to be some significant changes made for the business to succeed.
On 29 May 2019, the new owner dismissed Mr Raftery.
As in Arnold, it appears that in the employer’s mind, the relevant role was redundant, however, the employer failed to consult with the affected employee as required by the award. Accordingly, the Commission found the situation was not a “genuine redundancy” for the purpose of the Fair Work Act.  
The Commission went on to determine that, in the circumstances, the failure to consult did make the dismissal unfair. While the Commission acknowledged that the consultation process would have been unlikely to change the outcome, the Commission thought the employer should have given the employee the chance to find some suitable solution that would have seen his employment continue.
The two decisions are hard to reconcile. In both cases, it might be said that the failure to consult deprived the employee of the chance to find a better outcome. And in both cases, it might also be said that consultation would not have changed anything.
In our view, the relevant distinction was that in Arnold, the employer could show they had carefully thought through the possible options before reaching a decision. Conversely, in Raftery, the employer appeared to have acted more hastily. The lesson for employers is perhaps that it is important to document the reasons for decisions so you can establish that you have genuinely tried to give employees a fair go.

The difference between a criminal and workplace investigation was highlighted in the recent New South Wales Industrial Relations Commission decision of Bobin v Commissioner of Police.

On 26 July 2014, Mr Bobin and his then girlfriend, Ms Plumridge, had a fight.

Mr Bobin was charged with assault and intimidation as a result of what took place, but acquitted of those charges.

In 2018, Mr Bobin was, in effect, dismissed from the police force.

One of the grounds for dismissal was that his conduct on 26 July 2014 was contrary to legislated standards and the NSW Police Force Code of Conduct and Ethics.

Mr Bobin challenged his dismissal. Mr Bobin argued that his acquittal of the criminal charges meant that any allegations of misconduct in relation to the 26 July 2014 events were not made out.

The Commission rejected this argument on two bases.

First, the argument ignored the difference between the criminal and civil standards of proof. In relation to that, the Commission stated:

“The applicant’s submission of “Not Guilty” of the assault and intimidation charges therefore “Not Guilty” of [the misconduct allegations] does not take into account: the differences between the charges and the Allegations and the standard of proof required to establish guilt of the charges of assault and intimidation versus the standard of proof in this matter.”

Second, the argument ignored the difference between a criminal acts and conduct that breaches a relevant employment obligation. In relation to that, the Commission concluded that – whether or not he had engaged in criminal conduct - Mr Bobin had admitted to conduct that “created an environment that caused Ms Plumridge to fear some form of physical violence and she had reasonable grounds for those fears”.

Accordingly, the Commission found that Mr Bobin’s conduct did breach the relevant Act, Regulations and Code of Conduct.

The case highlights the important differences between criminal conduct and workplace misconduct. Employers sometimes believe that they should stand by if an issue is being investigated by the police. This decision emphasises why that attitude may not be correct. In some cases it may be appropriate, or indeed necessary, for an employer to conduct their own workplace investigation while criminal proceedings are underway.

The Fair Work Commission's decision in Reseigh v Stegbar Pty Ltd is an interesting example of when procedural defects in a dismissal will not render the dismissal unfair.

Mr Reseigh had been employed by Stegbar for more than 20 years before his dismissal. For the vast majority of that time, it appears that the employment relationship was successful.

Unfortunately, Mr Reseigh suffered a series of health issues in the last two to three years of his employment that affected both his physical and mental health.

Mr Reseigh took a great deal of sick leave to deal with his health issues. He also became increasingly erratic in terms of his attendance at work. He often failed to arrive at work on time, or at all, without any explanation.

It appears that his managers at Stegbar were genuinely concerned about his health and had many meetings with him to try to best understand how to support him through the problems he was facing. Changes were made to Mr Reseigh’s work arrangements in light of his health issues. However, Mr Reseigh’s attendance at work continued to be unpredictable.

After some time, Stegbar told Mr Reseigh that his behaviour had to change.

On 22 June 2018, he was given a written warning that his employment may be at risk. Despite this, Mr Reseigh continued to struggle to attend work regularly for what he said was a range of medical reasons.

In April 2019, Stegbar asked Mr Reseigh to attend a medical assessment. Stegbar did not provide the resultant medical report to Mr Reseigh.

On 21 May 2019, Mr Reseigh met with representatives from Stegbar to discuss why he continued to need so much time off. Mr Reseigh said he knew his employment was under review because he could not work a full week. Later that day, Mr Reseigh’s union sent a request to Stegbar asking that Mr Reseigh take some leave.

On 23 May 2019, Mr Reseigh called his supervisor to ask what was happening with his leave request and was told that Stegbar had decided to terminate his employment because of his inconsistent attendance and lateness. He subsequently received a termination letter.

Mr Reseigh then made an unfair dismissal application.

The Commission decided that there was a valid reason for Mr Reseigh’s dismissal, being his poor work attendance and regular lateness in circumstances where:

1. There was no evidence Mr Reseigh’s situation would change in the short to medium term

2. Stegbar had tried to support Mr Reseigh for some time and “did not rush to judgement”.

The Commission then considered whether the dismissal was nevertheless harsh, unjust or unreasonable. In relation to that, the Commission found that two aspects of the process could have been improved.

1. Mr Reseigh was expressly warned that his employment was at risk in 2018. However, this warning was not repeated at the meeting on 21 May 2019. The Commission stated:

“Whilst it would have been preferable to advise Mr Reseigh that Stegbar was considering his dismissal, the meeting … allowed Mr Reseigh an opportunity, which he used, to respond to the attendance issue.”

2. Mr Reseigh was not given the chance to respond to the medical assessment obtained in April 2019. The Commission stated:

“Whilst it would have been preferable for Stegbar to have referred to [the medical] report on 21 May 2019, it does not appear that Mr Reseigh was disadvantaged by this as the details it provided were within his knowledge.”

In the circumstances, the Commission decided that the dismissal was not harsh, unjust or unreasonable despite these two procedural defects.

The decision is an interesting example of the principle that not every procedural flaw will result in a dismissal being unfair. In this case, it appears that the Commission very much took a holistic view of the situation. Ultimately, the fact that Stegbar was able to show that it had tried to support Mr Reseigh over a relatively long period weighed strongly in its favour.

The Fair Work Commission’s recent decision in Peto v Ausgrid Management Pty Ltd is an interesting example of collective responsibility in the workplace and how workplace investigators can deal with uncertainty.

Sydney suffered some severe storms in December 2018. The power supply to many homes was affected. Mr Peto was one of the Ausgrid employees involved in reconnecting power. He worked as part of a five person team.

Unfortunately, a significant mistake was made while the team was reconnecting power to one house. The potentially fatal error involved the live and earth connections at the house being reversed. The resident immediately reported smoke coming out of a wall and a phone charger being ‘spat out’ of a socket. Happily, the situation was fixed without anyone being hurt.

The technical cause of the error was diagnosed relatively quickly as being an incorrect connection at the switchboard of the house.

The question of who was responsible for the error was more difficult to determine. Team members gave conflicting accounts to the workplace investigator about exactly what had happened.

Ultimately, the workplace investigator was unable to conclude which team member had made the incorrect connection. However, he determined that – whoever carried out the connection – the underlying cause of the mistake was a “gross breakdown in communication” between Mr Peto and two other team members.

The same consequences were applied to all three of these team members. Each of them received a formal warning.

Two of the team members accepted that outcome. Mr Peto challenged the decision under the dispute settlement procedure of Ausgrid’s enterprise agreement.

Mr Peto’s position was that he was responsible for reconnecting power at the nearest pole (which was done correctly) but not the house. He argued it was unreasonable to issue a warning to him for an error where there was no finding that he made the mistake.

The Commission rejected the argument that the workplace investigator ought to have made a finding about which employee had carried out the faulty connection. The Commission accepted that – given the conflicting evidence – not making such a finding was appropriate.

The Commission stated:

“The evidence makes clear that in the circumstances faced that day and which are commonly faced for this type of work, there must be a high level of communication and understanding of who performs what task, or step in the process. If a failure occurs in this respect, it seems to me it is only logical that all members of the Team have a shared responsibility. Shared responsibility for carrying out a job safely must also mean a shared understanding that not only are certain aspects of the job allocated, but that the work is done. In such safety critical work, assumptions as to who had done what in respect to vital safety checks, is extremely risky and could have catastrophic consequences.”

In the circumstances, the Commission found that:

"the disciplinary action proposed for Mr Peto is not unreasonable. The proposed disciplinary outcome does not ‘lack an evident and intelligible justification’.”

The case is a useful example of how workplace investigators can approach a situation where they are unable to form a view on the balance of probabilities about precisely what happened during an incident. This decision suggests that, in those circumstances, it is still reasonable for the investigator to make findings on responsibility and misconduct in the face of that uncertainty.

Very different decisions were handed down in two cases that were in some ways alike last week.

In Prasad v Cordina Chicken Farms the Fair Work Commission ordered the reinstatement of an employee who had been sacked for failing to report a safety incident. The employer had described Mr Prasad’s conduct as “inexcusably casual and lackadaisical”.

Mr Prasad’s explanation for the failure to report was that he was not on-site when the incident occurred and he had been told by a supervisor that the incident had already been reported to senior management who were investigating it.

The employer’s Group HR Manager gave evidence that:

“this was not the first time he had failed to report and then he always had basically given an excuse that he couldn’t report because of various reasons”.

It is fair to say that this evidence did not find favour with the Commission. The Commission stated:

“Regrettably, this evidence and the evidence provided more generally by [the Group HR Manager] was unconvincing and largely unsatisfactory. There was clearly a logical, plausible and reasonable explanation for why the applicant did not complete a formal report or further investigate the safety incident. There was no evidence to establish a proper basis for [the Group HR Manager] to reject this explanation. In simple terms, whatever the applicant may have done or not done in the past does not represent a sound or defensible basis upon which to determine the issues that were under examination at that time.”

In Ramadas v Industrial Relations Secretary (Legal Aid Commission of NSW),
the NSW Industrial Relations Commission rejected the employee's unfair dismissal claim.

Ms Ramadas had been dismissed for a number of reasons, including that she had made vexatious complaints against some of her colleagues.

Although the evidence suggested that the employer had been sceptical of the employee’s complaints from the outset, the employer did not dismiss them out of hand. Instead, the employer conducted an initial investigation and – only once that was concluded – engaged an external workplace investigator to review whether the allegations were vexatious.

The workplace investigator appears to have conducted an extensive review and he produced a report of over 400 pages concluding that the allegations were not made in good faith.

The Commission accepted that the allegations by the employee were “baseless and, in some cases, scandalous” and that the employee's conduct in making them was “misconduct such as to warrant the termination of her employment”.

Obviously, every case turns on its facts. But the two cases serve as contrasting examples of how to respond to misconduct issues. In Prasad the employer perhaps jumped too quickly to the conclusion that the employee should be dismissed without giving the employee a “fair go”. Conversely, in Ramadas the employer proceeded more cautiously before reaching the decision to dismiss.

Note - this note relates to a decision that was quashed on appeal - our note on the appeal decision is here.

The Fair Work Commission’s decision in Odgers v Central Queensland Services Pty Ltd  highlights the need for employers to follow their own processes when disciplining employees for misconduct.

Ms Odgers was employed by a subsidiary of BHP as a truck driver at a remote mine site. She was dismissed in March 2019.

The FWC found that BHP took three incidents into account in reaching the decision to dismiss Ms Odgers.

1. In September 2018, Ms Odgers spoke to both her supervisor and other workers inappropriately about a decision to dismiss a contractor who was a friend of hers.

2. In October 2018, Ms Odgers put some butter knives and a sex toy in a colleague’s bag just before they went through airport security. Ms Odgers said the this was a prank to get back at the colleague for a prank he had played on her some time earlier. There was no evidence that any of Ms Odgers’ colleagues were offended by what Ms Odgers did.

3. In March 2019, Ms Odgers (and others) posed for a sexually suggestive photo at the mine site while in their work uniforms.

The Commission found that Ms Odgers’ conduct did create a valid reason for her dismissal. The Commission stated, “[i]n no uncertain terms, Ms Odgers’ misconduct was unacceptable”.

However, the Commission found that there was an “abject failure” by the employer to follow its own investigative and disciplinary process. The evidence suggested that the relevant decision maker (who was not an HR professional) had completely ignored the relevant guidelines.

In those circumstances, the Commission found that the dismissal was unjust and unreasonable.

The Commission emphasised that not every procedural breach would render a dismissal unfair, stating:

“I wish to reiterate that each time this respondent has a matter before me I will not hold it to the highest standard of ensuring every inch of procedural fairness has been afforded to a dismissed employee. In every matter the circumstances of each dismissal will be given appropriate consideration.

However, for the respondent to have no regard at all to its obligations in this matter of applying [its own guidelines] pursuant to the relevant enterprise agreement, means that despite there being a valid reason for the dismissal, and despite Ms Odgers knowing the context of the respondent’s findings in relation to each of the incidents, I conclude that for the reasons above, the dismissal was unjust and unreasonable."

The decision is another example of how having clear guidelines about disciplinary issues can be useful - but only if the employer follows them. Having and, critically, following, a fair process is a fundamental part of giving employees a “fair go”.

In many cases, an employee’s long and positive employment history counts in their favour when assessing an unfair dismissal claim. For example, in the recent decision of Scott v Latrobe Regional Hospital, the employee’s length of service was one of the factors that went towards the Fair Work Commission finding in favour of the employee notwithstanding that there was a valid reason for dismissal.

However, two recent decisions have highlighted the potential “double edged sword” for experienced workers facing misconduct allegations.

In BlueScope Steel v Habak, the Full Bench of the Fair Work Commission considered a case involving a worker who had given 39 years’ service and who had been commended for “sustained high performance” in 2014.

The Full Bench found that the there was a valid reason for the employee’s dismissal. In considering whether the dismissal was nevertheless harsh, the Full Bench stated:

“The [employee’s] work history and the impact of the dismissal on him are factors that weigh in favour of a finding of harshness. However, these factors have to be balanced against an expectation that such a long serving employee would follow the policies and procedures of the [employer].”

Ultimately, the Full Bench found against the employee - reversing the decision at first instance.

Similarly, in Dias v Commonwealth Bank of Australia, the Fair Work Commission considered an unfair dismissal claim made by a bank employee with 13 years’ experience. Again, the employee’s length of service worked both as an asset and a liability. The Commission stated:

“I have taken into account the [employee’s] 13 year period of service, her family circumstances and poor prospects of alternative employment in the banking sector. I have earnestly grappled with the issue of whether these factors of ‘harshness’ outweigh the seriousness of the allegations of misconduct, when viewed collectively, and in the context of other ongoing performance issues over two years. Regrettably, I am satisfied that they do not. On one view, an employee’s long period of service will actually tell against a finding of ‘harshness’, where it might ordinarily be expected the employee would be very familiar with the Bank’s policies and procedures and where the employee has been properly trained. In short, a long serving employee would be expected to know better.”

The Habak and Dias decisions highlight that an employee’s extensive experience might count against them in the context of a workplace misconduct investigation and its consequences. In both those cases, the matters in issue involved fundamental aspects of the employee’s role – safe operation of machinery in the case of Habak and following an account authority in the case of Dias. In those types of situations, it may be reasonable for employers to expect more of very experienced employees than they would of others.






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How you draft the allegations against the respondent can have a real impact on whether the investigation process is fair.

A recent example of this arose in the New South Wales Industrial Relations Commission’s decision in Gaite v Commissioner of Fire and Rescue NSW. 

In that case, the Commission ordered that Mr Gaite be reinstated to his position with Fire and Rescue NSW.

Mr Gaite had conducted basic life support training for some new recruits. After the training, concerns were raised about Mr Gaite’s conduct. As a result, a misconduct investigation began.

The letter setting out the allegations against Mr Gaite included an allegation that – as a result of various matters – Mr Gaite had “victimised, humiliated, intimidated or threatened the recruits”.

In assessing whether Mr Gaite was given “a fair go all round”, the Commission observed:

“Presumably, there was a purpose behind the use by FRNSW of four separate terms to describe Mr Gaite’s behaviour and FRNSW intended each word have work to do. The evidence does not disclose, however, what meaning FRNSW attributed to each term. [The investigation report] does not draw a distinction between the various terms but [the investigator] seems to have accepted that the Allegation was sustained in all respects.

Bringing an allegation against an employee involving multiple and possibly overlapping elements can create uncertainty as to the nature of the case that the employee must meet. This does little to ensure “a fair go” to the employee.”

The important take-away for those drafting allegations in a workplace misconduct investigation is to think carefully about the precise wording of the allegations. In this case, with the benefit of hindsight, it would have been preferable for the investigator to be clear about why all four words were used and for the final report to make clear precisely what aspects of the allegation had been substantiated (and why).

The approach taken to the drafting of the misconduct allegations here stands in contrast to that taken by the employer in another recent case - Dias v Commonwealth Securities Limited. Our note of that case is here.