Serious Misconduct - Yes or No?
Melbourne Stadiums Ltd v Sautner  FCAFC 20
The case of Melbourne Stadiums Ltd v Sautner  FCAFC 20 concerned the termination of a contract of employment between Melbourne Stadiums Limited (‘MSL’) and Mr Sautner, their Director of Commercial Business.
On 3 June 2013, Mr Sautner was provided with written notice that his position was being made redundant with immediate effect and that in addition to redundancy pay, MSL would pay him 6 months’ remuneration in lieu of notice under clause 7.1 of his contract. However, on 20 June 2013, MSL asserted that based on recently discovered information it was entitled to terminate Mr Sautner’s contract for serious misconduct under clause 7.2 of his contract and accordingly, would not be paying him redundancy pay or 6 months’ remuneration in lieu of notice that had been previously offered.
There were four instances of misconduct relied upon by MSL in terminating Mr Sautner for serious misconduct and they were categorised as follows:
The bartering misconduct – Mr Sautner used tickets to the Medallion Club area of the stadium as a form of cash to obtain goods and services for his personal benefit, contrary to MSL policy;
The Australian Rugby Union (‘ARU’) misconduct – Mr Sautner used his position to induce another employee to issue him tickets to a rugby match to be played at the stadium in breach of the ARU’s requirements;
The disparagement conduct – Mr Sautner made disparaging, disrespectful and derogatory comments about the CEO and showed a fellow employee photographs of the CEO, taken without the CEO’s consent;
Breach of the CEO’s direction – Mr Sautner was directed by the CEO not to be involved with a Perth Stadium project but thereafter arranged two tours of the stadium.
Mr Sautner made a common law contract claim to the County Court as well as a claim for payment of redundancy and for the imposition of a civil penalty against MSL under the Fair Work Act 2009 (Cth).
In the initial proceedings, the Judge held that Mr Sautner had not engaged in serious misconduct with regard to any of the abovementioned conduct and accordingly, was entitled to be paid the 6 months’ notice and redundancy pay.
MSL appealed the decision. On appeal, the Court held that Mr Sautner had not engaged in serious misconduct with respect to the conduct described above as ‘breach of the CEO’s direction’, however, they found that Mr Sautner had engaged in serious misconduct with respect to the bartering misconduct, the ARU misconduct and the disparagement conduct.
The Court stated that the problem with the reasoning of the Judge in the initial proceedings was that he focused on things Mr Sautner could have done better, such as clearing the tours of the Perth Stadium or clarifying MSL’s policy with respect to use of Medallion Club tickets. The Federal Court said the focus should have been on the destruction the misconduct caused to the relationship of trust, essential to the employment relationship. The Court held that Mr Sautner’s actions were deliberate, involved elements of dishonesty e.g. Mr Sautner tried to cover his tracks, and struck at the heart of the trust relationship and accordingly, that Mr Sautner had been validly terminated for serious misconduct.
As part of the decision of the Court on appeal it was necessary to address Mr Sautner’s contention that if termination of his contract of employment had occurred under clause 7.1., on or around 3 June 2013, then his contract could not be terminated again on or around 20 June 2013, under clause 7.2, for serious misconduct.
Whilst the court accepted that above contention i.e. that a contract cannot be terminated twice, it held that Mr Sautner’s contract had not been terminated under clause 7.1 and would not have been terminated until payment of the six months’ pay in lieu of notice had been made to Mr Sautner. As of 20 June 2016, it had not been made.
LESSONS FOR EMPLOYERS
Although held to be serious misconduct on appeal, the judge at first instance held that the conduct did not amount to serious misconduct, highlighting that it can be difficult to determine when conduct on the part of an employee amounts serious misconduct. Employers should note that the threshold for serious misconduct is high and often the conduct will need to cause damage to the relationship of trust, essential to the employment relationship, to give the employer grounds for termination.
For advice regarding disciplinary processes, please do not hesitate to contact Workplace Legal on (03) 9972 4950.
When can an employer direct an employee to attend a medical examination before returning to work?
Daniel Cole v PQ Australia Pty Ltd T/A PQ Australia  FWC 1166
A recent unfair dismissal case in the Fair Work Commission, Daniel Cole v PQ Australia Pty Ltd T/A PQ Australia  FWC 1166 provides some guidance to employers on when they can reasonably direct an ill or injured employee to attend a medical examination prior to them returning to work.
Mr Cole was employed as a packer and worked night shifts from August 2011 until he was dismissed on 23 July 2015.
Mr Cole was absent from work for one day on 14 June 2015 and provided a medical certificate for the absence. That afternoon, he was suspended by his employer on the basis that he ‘did not seem to be coping very well at work and we are concerned for your welfare’. Mr Cole had never had any lengthy absences on personal leave to support his employers concerns. Mr Cole was suspended with pay from 14 June 2015 until 3 July 2015 and then without pay until his dismissal on 23 July 2015.
The Employer sent Mr Cole a letter on 17 June 2015 which stated “The reason that we have directed you not to attend for work until further notice is that a number of issues have arisen in the workplace over the last few months which have involved or affected you and we are concerned about the impact these issues have had on you and on others.”
At a meeting on 24 June 2015, Mr Cole was advised that he could not return to work until he attended an independent medical examination (‘IME’) by a doctor nominated by PQ Australia on the basis that they were concerned “you are having problems from time to time maintaining an effective working relationship with some of your work colleagues.” The Employer arranged an appointment for Mr Cole with Dr Baynes for 2 July 2015.
Mr Cole asked the Employer to reconsider the requirement for him to attend the appointment. The Employer advised Mr Cole and his representative that he was required to attend the appointment however Mr Cole failed to attend. Mr Cole was suspended without pay the following day, 3 July 2015.
On 15 July 2015, Mr Cole was again informed by Mr Doran, Vice President of Human Resources that if he failed to attend the IME his employment would be terminated.
On 23 July 2015, Mr Cole’s employment was terminated. The reasons included his failure to comply with the direction to attend an IME.
On 26 July 2015, Mr Cole was advised that his dismissal could be converted to a resignation if he agreed to certain terms. The following day, Mr Cole submitted his resignation, was paid notice and accrued entitlements. Mr Cole then made an application for an unfair dismissal remedy in August 2015.
The Commissioner held that it has long been accepted in case law that an employer may have the right to require an employee to attend a medical examination where the employer has concerns that an employee cannot perform the inherent requirements of their role. This is particularly pertinent in dangerous working environments. Further, under occupational health and safety legislation, employers have an obligation to ensure the health and safety of its workers. To achieve this, it is recognised that:
Employers can direct their employees to attend IME’s to determine if they are fit to safely perform their duties, provided that the direction to do so is reasonable; and
Where an employee refuses a reasonable direction to attend an IME, the employer may have a valid reason to dismiss them.
The decision included an outline of matters that need to be considered when answering the question of whether the requirement to attend an IME prior to returning to work is reasonable:
Is there a genuine need for the IME such as prolonged absences from work or absences without explanation or evidence of an illness which related to the capacity to perform the inherent requirements of the role?
Has the employee already provided adequate medical information that explained their absences and demonstrated fitness to perform their role?
Is the industry or workplace particularly dangerous?
Are there legitimate concerns that an employee’s illness or injury could impact on others in the workplace?
Does the employee agree to the IME?
Was the employee advised of the details of the conduct which led to concerns that they were not fit for duty?
Was the medical practitioner advised of the issues of concern and were those matters focused on the inherent requirements of the role?
Accordingly, the Commission found that the employer had no reasonable basis to assume that Mr Cole had any illness that would affect his ability to perform the inherent requirements of his role. This is particularly so when Mr Cole was absent for a single day and provided a medical certificate for the absence. Further, as the direction to attend an IME was not reasonable, the failure of Mr Cole to attend the IME was not a valid reason for dismissal.
LESSONS FOR EMPLOYERS
The above matters identified by the Commission provide guidance to employers when considering whether to send an employee to an IME before returning to work. If the considerations outlined above are not followed prior to the employer taking action in relation to the illness or injury (such as suspending or terminating employment), the action taken may not be valid and could expose the employer to various claims including unfair dismissal and general protections.
For advice in relation to managing ill or injured employees, please contact Workplace Legal on (03) 9972 4950.
Timelines when making applications at legal forums.
Webb v Disability Services Australia Limited  FWC 41
Timelines are very important when it comes to making applications at Legal forums. They can mean the difference between being able to bring a matter to the attention of the Court and seek relief. In this case, timelines were not adhered to and Mr Justin Webb ("Applicant") was disallowed from making an application at the Fair Work Commission ("FWC").
The Applicant was employed as a support worker with Disability Services Australia ("DSA").
The Applicant commenced work with DSA on 30 March 2015 and was dismissed on 20 August 2015.
The reasons for his dismissal revolved around unsatisfactory performance, and the Applicant having an inappropriate relationship with one of DSA's clients. DSA determined that the Applicant was not suitable for the role and terminated the same accordingly.
Due to the fact that the Applicant was terminated before the 6-month qualifying period was complete, he was not entitled to make an unfair dismissal claim with the FWC. This did not stop him from trying.
On 10 September 2015, the FWC notified the Applicant's representative that he did not meet the minimum employment period for an unfair dismissal application, having been employed by DSA for less than five months.
The Applicant was invited to discontinue the unfair dismissal claim which he did via a Notice of Discontinuance on 24 September 2015. Along with his Notice, the Applicant also submitted a general protections claim to the FWC - this was 14 days past the 21-day statutory timeframe within which he was entitled to file such a claim.
The Applicant applied for an extension of time to file the general protections claim with the FWC, and reasoned that he had shown “a continued, ongoing attempt to protect his right against dismissal" and that his application for an extension of time should not be rejected as a result of the use of the wrong form.
DSA did not oppose the Applicant's extension application.
The FWC however did not consider any of the Applicant's reasons or circumstance exceptional enough to warrant an extension of time for the making of the general protections application, and dismissed the application for the extension of time.
Consequently, the Applicant failed on both his application for the extension of time and the general protections application.
LESSONS FOR EMPLOYERS
It is extremely important to note procedural timelines.
In this matter the 21-day statutory timeframe applied to both unfair dismissal and general protection applications concurrently, and because that was not followed, the matter (notwithstanding its validity) was not heard by the FWC.
As an employer, should you receive any legal claim/application please do not hesitate to contact Workplace Legal on 03 9972 4950.