The appellant was employed by the respondent as Director – Corporate Services. He commenced as Manager of Human Resources in June 2012 and was promoted in April 2013. In May 2023, the appellant was summarily dismissed for misconduct, specifically for initiating an undocumented pay arrangement in April 2019. This arrangement postponed salary increases to be received as backpay in the future and was not disclosed to the CEO nor properly documented.

Upon discovery in March 2023, an investigation was conducted by the respondent, which lead to the appellant’s dismissal. The appellant brought two claims before the Commission: (1) unfair dismissal, arguing the process and outcome were unjust, and (2) denied contractual benefits, seeking payment for the balance of his fixed-term contract.

At first instance, the Commission dismissed both claims, finding that the pay arrangement breached contractual and statutory obligations, was secretive, and justified summary dismissal. The Commission held that the respondent did not need to prove actual breaches of law, but that a “real and substantial risk” of a breach sufficed. The investigation was found to be procedurally fair, and the appellant’s conduct was deemed serious misconduct.

The appellant raised sixteen grounds of appeal to the Full Bench, arguing that the Commissioner wrongly found a “real and substantial risk” of a breach sufficient for summary dismissal without proof of actual misconduct. Claims of procedural unfairness were made regarding the Council’s process under the Local Government Act 1995. The appellant also disputed any contractual breach and argued that any pay arrangement was a self-initiated variation, negating liability. Statutory breaches under various employment and tax laws were denied, as was any breach of the respondent’s Code of Conduct, which was said to rely on incorrect statutory findings. Additional grounds included failure to consider key evidence (such as testimony from the former CEO), reliance on irrelevant matters, flawed credibility assessments, and arguments regarding disparity of treatment, noting that a colleague was terminated with notice, which was relevant to the fairness of the appellant’s dismissal.

In considering the appeal, the Full Bench determined that:

• The Council, not the CEO, was the statutory decision-maker for the dismissal of senior employees under the Local Government Act 1995.
• Procedural fairness was compromised by the failure to provide the Council with complete and accurate information, including the appellant’s full response and mitigating circumstances.
• Summary dismissal requires proof of actual misconduct (wilful or grave), not merely a “real and substantial risk” of breach.
• The contractual right to summarily dismiss was conditional on the appellant being found “guilty” of misconduct.
• Errors were identified in the application of the Minimum Conditions of Employment Act 1993 and the Local Government Officers’ Award, which did not apply during the relevant period, and findings of risk of breach of tax and superannuation laws were unsupported.
• The investigation was found to be procedurally unfair, particularly in the process before the Council, which was misled as to key facts and not provided with all relevant material.
• Some adverse credibility findings were affected by error, especially those relating to the Award and matters irrelevant to the dismissal.

The Full Bench distinguished the circumstances of the appellant’s colleague but emphasised the need to consider mitigating circumstances and the impact of dismissal.

The Full Bench found that the summary dismissal was unfair as the conduct did not meet the contractual threshold for summary termination—specifically, there was no wilful or grave misconduct—and that the dismissal was procedurally unfair due to errors in the process before the Council and a failure to provide accurate, complete information. In addition, reinstatement was deemed impracticable owing to the breakdown in trust and confidence.  Accordingly, the appeal was upheld.

The decision can be read here.