REFERRAL TO COMMISSION UNDER PUBLIC SECTOR MANAGEMENT ACT 1994

WESTERN AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION

CITATION : 2022 WAIRC 00848

DELIVERED : FRIDAY, 16 DECEMBER 2022

FILE NO. : APPL 9 OF 2022

Applicant

AND

Minister for Corrective Services

Respondent

CatchWords : Application for matter to be dismissed under s 27(1)(a) of the Industrial Relations Act 1979 (WA) – Applicant bound by agreement made in related application before the Commission – Finding there was valid consideration and that it would not be in accordance with equity and good conscience for the matter to proceed – Application for matter to be dismissed upheld – Substantive application dismissed

Legislation : Industrial Relations Act 1979 (WA): s 6(b), s 26(1)(a), s 27(1)(a)    

Result : Section 27(1)(a) application upheld & substantive matter dismissed

Representation:

Applicant : Mr J Theodorsen (as agent)

Respondent : Mr J Carroll (of counsel)

Cases referred to in reasons:

Foseberry v Mt Newman Mining Co Pty Limited  (1988) 68 WAIG 1882

Magyar v Department of Education [2019] WAIRC 00781

Re Queensland Electricity Commission; Ex parte Electrical Trades Union of Australia [1987] HCA 27; (1987) 61 ALJR 393

The Australian Rail, Tram and Bus Industry Union of Employees, West Australian Branch v Public Transport Authority of Western Australia [2017] WAIRC 00830

Reasons for Decision

1         Ms Smith has referred to the Commission the decision of the Minister for Corrective Services (Minister) to take disciplinary action against her as a result of a finding that she committed a breach of discipline. 

2         The Minister objects to the Commission hearing and determining that substantive matter because Ms Smith’s union, the Western Australian Prison Officers’ Union of Workers (Union), brought a section 44 application for her benefit challenging the same finding and penalty that are challenged in application APPL 9 of 2022. That section 44 application was resolved after conciliation and further negotiations between the Union and the Minister. The Minister asks the Commission to dismiss application APPL 9 of 2022 under s 27(1)(a) of the Industrial Relations Act 1979 (WA) (IR Act) because it is frivolous, vexatious and an abuse of process to seek to re-litigate matters which have been settled (Dismissal Application).

3         Ms Smith says there is no abuse of process in this case because the agreement reached between the Union and the Minister does not prevent Ms Smith from bringing application APPL 9 of 2022 and the agreement is not legally binding in any event because of a lack of valid consideration.

What the Commission must decide

4         To resolve this matter, the Commission must decide whether to dismiss application APPL 9 of 2022. That involves answering the following questions:

a. What were the terms of the agreement in the section 44 application C 22 of 2021?

b. Was there valid consideration?

c. Would it be in accordance with equity and good conscience for the matter to proceed?

Background

5         By way of disciplinary action, Ms Smith was demoted from Senior Officer to Prison Officer on 6 May 2021.

6         The parties agree that Ms Smith has regularly acted as a Senior Officer since November 2021, including 6, 7, 10, 17 and 18 November 2021, 24 November 2021 to 6 January 2022, 18 February to 31 March 2022, 1 April to 12 May 2022 and 24 June to 4 August 2022.

7         Neither party led any witness evidence. The parties asked that the Commission determine the Dismissal Application on the basis of agreed documents and their submissions.

The Minister’s case

8         The Minister asks that the Commission dismiss application APPL 9 of 2022 under s 27(1)(a)(ii) or (iv) of the IR Act. He says that the section 44 application brought by the Union (application C 22 of 2021) challenged the same finding and penalty which are challenged in these proceedings. That section 44 application was conciliated. Following further negotiation after the conciliation, the parties resolved the dispute. Ms Smith also agreed to the dispute being resolved on the agreed terms. The Minister points to a series of emails that he says show Ms Smith agreed to the resolution. In one email, the Union’s lawyer says ‘Ms Smith and the Union have expressed their agreement to resolve application C 22 of 2021 on the terms referred to in your email below.’ The email below relevantly says:

The Department is willing to extend again its previous offer, namely:

- Ms Smith’s demotion and the disciplinary findings remain;

- Ms Smith acknowledges the disciplinary findings and provides an assurance that the matter will not be repeated;

- Ms Smith completes the Department’s Accountable and Ethical Decision Making module (online); and

- Ms Smith is unable to act in a higher role for a period of 6 months from the service of the original outcome letter (ie until 6 November 2021), save that she may act in a higher role at minimum security prisons.

This offer will remain open until COB Friday 20 August. Please let me know if the Applicant and Ms Smith will accept the proposal.

9         The Minister says the dispute was resolved in such a way that Ms Smith accepted the findings and penalty. The Union’s lawyer asked for and received Ms Smith’s consent to the resolution of the section 44 application on the stated terms. The Minister says that Ms Smith performed her part of the settled outcome, as shown by the emails between the parties and the letter Ms Smith sent the Department on 18 August 2021. That letter said:

Dear Mr August

Disciplinary Matter

I refer to the investigation report CF200422 prepared by your office dated 11 March 2021 (report).

The report related to events that took place at Melaleuca Women’s Prison during a night shift on 8 April 2020.

The report contained findings that were critical of the fact that I remained within an office with a closed door for a period of approximately 4 hours between 1:28am and 5:22am while I was the Senior Officer on shift at the time.

I acknowledge the findings made in the report and I give my assurance that the conduct referred to in the report will not be repeated.

Yours sincerely

Jade Smith

10      The Minister argues that a term of the agreement in application C 22 of 2021 was that Ms Smith’s demotion and the disciplinary findings remain. That cannot leave open the possibility that the Union or Ms Smith could later contest the demotion or the disciplinary findings.

11      Further, the Minister says that his promise not to hold Ms Smith’s demotion against her when considering acting appointments from 6 November 2021 was good consideration.

12      The Minister says the settlement agreement entirely resolved the matter the subject of application C 22 of 2021. He argues that the dispute in this application is the same as the dispute in the section 44 application, which was resolved by agreement. In those circumstances, application APPL 9 of 2022 is frivolous, vexatious and an abuse of the Commission’s processes because it seeks to re-litigate matters that have been settled.

13      The Minister argues that if such re-litigation were available after a settled resolution of section 44 conference, there would be a complete chilling effect on employers engaging in any form of settlement discussions at a section 44 conference. He says these proceedings should be dismissed because it would be oppressive and an abuse of process for them to continue.

Ms Smith’s case

14      Ms Smith argues that the Minister bears a heavy onus to show that application APPL 9 of  2022 should be dismissed.

15      She agrees that it may be an abuse of process for a person to re-litigate a matter that has been the subject of a settlement agreement reached at a conference or binding settlement terms that the parties agree outside the Commission. But Ms Smith says there is no abuse of process in this case because:

a. the agreement reached in application C 22 of 2021 does not prevent Ms Smith from bringing application APPL 9 of 2022; and

b. the agreement in application C 22 of 2021 is not legally binding because there is no valid consideration.

16      Ms Smith argues that the Minister’s ‘consideration’ was merely a promise to fulfil an existing legal duty, which cannot be valid consideration.

What were the terms of the agreement in application C 22 of 2021?

17      Ms Smith says, and it is not in dispute, that the terms of the settlement agreement include:

a. Ms Smith’s demotion and the disciplinary findings would remain;

b. Ms Smith would sign a letter in an agreed form acknowledging the disciplinary findings and assuring that the matter will not be repeated;

c. Ms Smith would complete the Department’s Accountable and Ethical Decision Making module (online);

d. Ms Smith would not act in a higher role until 6 November 2021, other than at minimum security prisons; and

e. the Union would discontinue application C 22 of 2021.

18      Ms Smith maintains that the settlement agreement does not contain a term preventing her from bringing a further application. It does not refer to ‘full and final settlement’ or no further claims. Ms Smith argues that the term that her demotion and the disciplinary findings would remain does ‘no more than state that the respondent will not reconsider the disciplinary decision. Those words do not take a necessary further step by including a promise that Ms Smith or the Union will not pursue other rights that might disturb the demotion or findings.’

19      Ms Smith argues that a term preventing further applications in respect of the demotion cannot be implied because it is not obvious or necessary to the extent that the agreement would be ineffective without it.

Was there valid consideration?

20      Ms Smith says that the only consideration from the Minister in the settlement agreement was that his officers would not prevent Ms Smith from acting in higher positions for a shorter period than originally intended (Minister’s Promise).

21      She says the effect of Commissioner’s Instruction 1: Employment Standard  (Employment Standard) is that public sector employers have a legal obligation to appoint staff to positions (including acting roles) based on the principles of merit, equity, the employee’s interests, the employer’s work-related interests and transparency. In order to comply with their legal obligations, the Minister’s officers could not have appointed Ms Smith to act in a higher position unless such an appointment was consistent with the principles in the Employment Standard. Ms Smith argues that if it was appropriate to appoint her to work in a higher position based on these principles, it would not have been proper to refuse her appointment to act up simply because she had not agreed to refrain from asking the Commission to review the disciplinary outcome.

22      In essence, Ms Smith says that the consideration in the settlement agreement was not valid, because the Minister’s Promise was merely a promise that the Minister would observe the Employment Standard which was an existing legal duty. Accordingly, she argues that the settlement agreement cannot be legally binding.

Would it be in accordance with equity and good conscience for the matter to proceed?

23      Ms Smith says it would be in accordance with equity and good conscience for this matter to proceed because:

a. she has a statutory right to make the application;

b. the conference held in application C 22 of 2021 did not result in settlement;

c. the settlement agreement that was eventually reached did not contain a term preventing Ms Smith from bringing future actions concerning the disciplinary outcome; and

d. in any event, the settlement agreement was not binding because there was no valid consideration.

Consideration

24      A party is entitled to invoke the Commission’s jurisdiction and prima facie expect it to be exercised: Re Queensland Electricity Commission; Ex parte Electrical Trades Union of Australia [1987] HCA 27; (1987) 61 ALJR 393 per Deane J at 399. However it is beyond doubt that the Commission has the power under s 27(1)(a) of the IR Act to dismiss or refrain from further hearing a matter at any stage of proceedings if it is satisfied that the requirements set out in s 27(1)(a) of the IR Act are met. That power is broad and should be exercised with caution: Magyar v Department of Education [2019] WAIRC 00781 [13]-[15], applying the reasoning in The Australian Rail, Tram and Bus Industry Union of Employees, West Australian Branch v Public Transport Authority of Western Australia [2017] WAIRC 00830 at [137]-[139].

25      The Union brought the section 44 application for Ms Smith’s benefit, claiming that the disciplinary findings against her were flawed, unreasonable and untrue, and that her demotion was harsh. The Union sought to overturn the demotion and have compensation paid to Ms Smith. The conference outcome email sent by the Commissioner’s Associate shows that the Union made an offer to settle the section 44 application in a way that would reverse Ms Smith’s demotion. The parties continued to negotiate after the conciliation conference and eventually reached an agreement to settle the section 44 application (Settlement Agreement).

What were the terms of the agreement in application C 22 of 2021?

26      Considering the evidence before the Commission, I am satisfied that the terms of the Settlement Agreement were as set out in Mr Pack’s email dated 13 August 2021 sent at 4:24pm and the reply from the Union’s lawyer. Specifically:

a. Ms Smith’s demotion and the disciplinary findings would remain;

b. Ms Smith would sign a letter in an agreed form acknowledging the disciplinary findings and assuring that the matter will not be repeated;

c. Ms Smith would complete the Department’s Accountable and Ethical Decision Making module (online);

d. Ms Smith would not act in a higher role until 6 November 2021, other than at minimum security prisons; and

e. the Union would discontinue application C 22 of 2021.

27      It is beyond doubt that the terms of the Settlement Agreement included that the findings of breach of discipline and demotion remain in place. Indeed that was expressly set out as the first term. The Union’s lawyer noted that Ms Smith agreed with the terms of settlement. In effect, Ms Smith accepted the findings and penalty.

28      In my view, a fair reading of the correspondence in this matter makes it clear that the Settlement Agreement would entirely resolve the industrial matter the subject of application C 22 of 2021 and the Union would discontinue the proceedings in return. The effect of, and intrinsic to, the term that the findings of breach of discipline and demotion remain in place is that further actions seeking to overturn the findings or penalty are precluded.

29      Therefore I consider that the terms of the Settlement Agreement prevent Ms Smith from appealing the disciplinary outcome.

Was there valid consideration?

30      The Minister’s Promise allowed Ms Smith to be eligible for acting up opportunities from 6 November 2021, which Ms Smith regularly did, as set out at [6] above. The Minister characterises this as a promise not to hold Ms Smith’s demotion against her when considering acting appointments from 6 November 2021, while Ms Smith characterises this as a promise by the Minister that his officers would not prevent Ms Smith from acting in higher positions for a shorter period than originally intended. In my view, both characterisations are accurate and have the same practical effect.

31      I consider that the Minister’s Promise was valid consideration.  It was not merely a promise to observe the Employment Standard.

32      Clause 154 of the Department of Justice Prison Officers’ Industrial Agreement 2020 (Industrial Agreement) regulates the ability to act in higher positions. It provides the expectation of acting up where a Prison Officer meets the eligibility criteria unless the Superintendent decides not to roster a particular officer because she or he has reasons for doing so.

33      The Minister demoted Ms Smith because he found that she committed a breach of discipline. I accept the Minister’s argument that a demotion on the basis that Ms Smith’s conduct does not meet the standards of behaviour expected of a Senior Officer is a good reason not to allow her to act up for a period. The Minister was not obligated to allow Ms Smith to act up. Accordingly, the promise not to hold Ms Smith’s demotion against her when considering acting appointments from 6 November 2021 was good consideration.

34      I am not persuaded that the Employment Standard obligated the Minister to allow Ms Smith to act in a higher role. The Employment Standard requires employment decisions to be made according to principles of merit, equity, interest and transparency. As a matter of merit, it would be open to the Minister to decide that Ms Smith’s recent demotion on the basis that her conduct did not meet the standards of behaviour expected of a Senior Officer was a good reason not to allow her to act up for at least a period after her demotion. Further, I accept that, consistent with the Employment Standard, the Minister could also reasonably decide that the settlement of application C 22 of 2021 (which included acknowledgment by Ms Smith of the findings in the report and her promise not to repeat such conduct) provided a sound basis to allow Ms Smith to act in a higher role in future.

35      I find there was valid consideration.

Would it be in accordance with equity and good conscience for the matter to proceed?

36      Ms Smith eventually conceded that she is bound by the Settlement Agreement. In my view, bringing application APPL 9 of 2022 is inconsistent with agreeing that the disciplinary findings and the demotion remain in place. Further, the industrial matter the subject of these proceedings was entirely resolved by the Settlement Agreement that resolved application C 22 of 2021.

37      In Foseberry v Mt Newman Mining Co Pty Limited  (1988) 68 WAIG 1882 (Foseberry) an employee’s union brought a section 44 application against his former employer contending that the employee’s dismissal was unfair. The matter resolved by agreement following the section 44 conference. The employee then brought an unfair dismissal claim against his former employer. Fielding C (as he then was) held that the application should be dismissed under s 27(1) of the IR Act. He said:

It seems to me to make a mockery of the Act and its stated objects to ascertain a claim by an individual in respect of an alleged unfair dismissal after a union on behalf of the employee, has taken steps in the Commission to resolve the matter by conciliation…. And after that process had produced a result considered satisfactory by both the union and the employer I would have thought that the Commission was entitled to expect that in this instance the Union was acting consistently with its duty under the Act and in so doing represented the Applicant’s interests properly, albeit not to his liking. In these circumstances the Commission would normally be justified in exercising its discretion under section 27(1) of the Act to either dismiss or refrain from hearing the matter.

Still more importantly the Commission is enjoined by section 26 of the Act to act according to equity as well as the substantial merits of the matter when determining any industrial matter before it. The cases suggest that is to be interpreted as requiring the Commission to adopt a broad approach of common sense and fairness without regard to legal technicalities. It hardly seems sensible to allow an employee to first air his grievance before the Commission in respect of the same matter. Still less does it seem fair to submit his employer to two actions in respect of the same matter in the one tribunal.

…In any event it seems to me that there is a great element of unfairness in a process which enables an employee through his union to have access to the Commission in order to settle an industrial grievance affecting him directly and when an agreement in respect of that matter is reached which the union deems acceptable but he does not, and later enables the employee to have the matter aired again by another route. Such a process places the Respondent in double jeopardy in respect of the same matter and contrary to the spirit of the legislation, affords no encouragement to settle the dispute by conciliation processes of the Commission.

38      Broadly I agree with the approach taken in Foseberry. Contrary to Ms Smith’s submissions, I do not consider that the Commission should distinguish Foseberry because in that case, the Union accepted recommendations made by the Commission or because in this case agreement was reached after the conference. Further, I do not consider it significant that in Foseberry the Commissioner considered the merits of the matter. It is clear from the Commissioner’s reasoning that he considered that the matter could be dismissed under s 27(1)(a) of the IR Act without considering the merits. The Commissioner then went on to say: ‘In any event, even if I were not to adopt that course, I take the view that there is nothing on the merits of the matter which leads me to conclude that the Applicant was unfairly dismissed’ (emphasis added).

39      I consider that in all of the circumstances, it would not be in accordance with equity and good conscience for this matter to proceed. The subject matter of this dispute was settled by agreement. Ms Smith does not point to any exceptional reason that would justify her being able to re-litigate the dispute.

40      Ms Smith has had the financial benefit of the deal struck on her behalf in application C 22 of 2021, by having the opportunity to act up in the Senior Officer role. It would be contrary to equity and good conscience for her to take the benefit of the Settlement Agreement and then deny that that deal binds her in these proceedings.

41      Further, the Minister’s submission that allowing re-litigation following a settled resolution to a section 44 conference would have a complete chilling effect on employers engaging in any form of settlement discussions at a section 44 conference is a fair one.

42      I consider that it would be inconsistent with the principal objects of the IR Act to allow Ms Smith to pursue application APPL 9 of 2022 in circumstances where she:

a. agrees she is bound by the agreement in application C 22 of 2021; and

b. agreed to resolve application C 22 of 2021 on the terms set out at [26] above, which included agreeing that the findings of breach of discipline and demotion remain in place.

It would not encourage, and provide means for, conciliation with a view to amicable agreement and preventing and settling industrial disputes: s 6(b) of the IR Act.

Conclusion

43      For these reasons, I am satisfied that application APPL 9 of 2022 should be dismissed under s 27(1)(a) of the IR Act.

44      The Dismissal Application is upheld. The Commission will dismiss application APPL 9 of 2022.