100423133

WESTERN AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION

PARTIES BARRIE THOMAS KERTON

APPLICANT

 -v-

 BANDABERRY PTY LTD - TRADING AS MANDURAH HOLDEN

RESPONDENT

CORAM COMMISSIONER S J KENNER

DATE TUESDAY, 15 JUNE 2004

FILE NO/S APPLICATION 567 OF 2003

CITATION NO. 2004 WAIRC 11731

_______________________________________________________________________________

Catchwords Industrial Law - Termination of employment – Harsh, oppressive and unfair dismissal – Principles applied – Applicant summarily dismissed – Lack of procedural fairness – Applicant harshly, oppressively and unfairly dismissed – Application upheld – Reinstatement impracticable – Compensation ordered – Industrial Relations Act 1979 (WA) s 29(1)(b)(i), s 23A, s 26(1)(a), s 26(1)(c), s 23A(8)

Result Application upheld.  Order issued

Representation

Applicant Mr K Trainer as agent

Respondent Mr G Miller as agent

_______________________________________________________________________________

Reasons for Decision

1          The respondent is a motor vehicle dealership based in Mandurah in this State.  It is a dealership within the General Motors Holden motor company network.  The applicant commenced employment with the respondent as a sales person on or about 11 September 2000.  The applicant's employment came to an end summarily, on or about 19 April 2003 for misconduct, arising from an incident that occurred on that day.  As a consequence of his dismissal, the applicant now brings this claim pursuant to s 29(1)(b)(i) of the Industrial Relations Act 1979 (“the Act”) seeking orders pursuant to s 23A of the Act.

Factual Background

2          The applicant testified that he attended for work on Saturday 19 April 2003 at about eight o’clock in the morning.  The applicant had arrived at the yard that morning, in one of the respondent's vehicles, which was permitted by its policies.  As he arrived, Mr Merks, the respondent's general sales manager, on observing the state of the vehicle which he considered to be unclean, requested the applicant to clean it in order that it could be in presentable condition for sale to prospective customers.  The applicant testified that he then drove the vehicle into the cleaning bay to clean it, but did not do so immediately.

3          According to the applicant's evidence, shortly after, Mr Merks requested that the applicant see him in his office.  The applicant went to Mr Merks’ office at which time Mr Merks questioned the applicant regarding a used car deal the applicant had negotiated with a customer Mr Bain.  There was some issue as to whether the applicant had sought Mr Merks' approval for the transaction, which was apparently the respondent’s written policy.  The applicant alleged that in discussing this matter, Mr Merks spoke to him in an abusive manner, and suggested that Mr Merks told him he was “nothing but a f... conman.”  The transaction was said to have cost the dealership about three or four thousand dollars in losses. 

4          The applicant testified that Mr Merks continued to abuse him and use obscene language and he in response became irate and offended.  He testified that he raised his voice and “gave as good as he got”.  The applicant's evidence was he tried to explain to Mr Merks that he may have been mistaken about the trade in vehicle transaction and he may have mistaken the transaction for another “deal” done.

5          Mr Merks, called to testify by the respondent, denied he was mistaken in relation to the deal.  He said that the respondent’s policies for used car sales were clear, and that for all trade-ins, he was required to inspect the trade-in vehicle and provide an estimate of value.  This did not occur in relation to the Bain transaction. 

6          Mr Merks' version of the events as they unfolded in his office was quite at odds with the applicant's.  He testified that he spoke to the applicant about the paper work for the Bain transaction, and the applicant “blew up” and became abusive and aggressive.  Mr Merks denied that he suggested the applicant was a conman or trickster but did say in cross-examination that he told the applicant that he had misled him on the transaction.  Mr Merks denied that he used profane language to the applicant and moreover, said he was concerned for his safety.  He said this because according to the evidence of Mr Merks, the applicant, when he “blew up”, put his fist in Mr Merks' face and with his body bulk, given he was much larger physically than Mr Merks, pushed Mr Merks back into his office chair.  Mr Merks testified the applicant was so loud, he thought everyone in the area could hear it.  There was some suggestion in a statement prepared by Mr Merks, tendered as exhibit A6, and made on or about 23 April 2003, that on leaving his office, the applicant closed the sliding door so hard that it came of its mountings.  This was not explored however, with Mr Merks in his testimony.  Mr Merks did agree, that the applicant may have said to him that he “did not like being treated like shit.”

7          Mr Merks denied that he also raised his voice, and said he remained generally calm because he was concerned the applicant was going to hit him.

8          After the applicant left the office, Mr Merks left his office and went over towards the new car manager’s office, which was approximately 30 metres away in another building. By this time apparently, the applicant had gone back to his own office.  Mr Merks testified that he informed the new car manager, Mr Spark, of what had just occurred.  Mr Spark was also called to testify.  He said that on the morning in question, he heard loud noises coming from the used car office building.  He said there were some sales people in the area who were also within earshot of the incident.  Mr Spark’s evidence was that he in the main heard the applicant's voice, not that of Mr Merks.  He said there was very bad language used, and some customers were also in the yard at the time.  Mr Spark testified that Mr Merks told him what had happened and that there had been an altercation in his office.  There was some suggestion that Mr Merks had or had attempted, to dismiss the applicant.  Indeed, Mr Spark seemed to have the impression after he spoke with Mr Merks at this time that the applicant had already been dismissed. 

9          In relation to the issue of a dismissal at this point, the evidence was somewhat equivocal. Mr Merks testified that he told the applicant after the altercation, that he could not work with him but also testified that he did not have the authority to “hire and fire”, that being a matter for the dealer principal, Mr Van Dale.

10       After this initial incident, it seems that a further incident occurred, in Mr Kerton's office.  Mr Merks went in to see the applicant, and requested he leave the premises.  The applicant refused, taking the view that Mr Merks was not able to dismiss him.  According to the applicant's version of events, he was out of his chair and Mr Merks stood near the back wall of the office.  The applicant denied that he was engaging in any further threatening behaviour and they were standing about one metre apart.

11       This was not Mr Merks' evidence.  He testified that again the applicant was abusing and threatening him, and had him up against the wall and was leaning over him with his larger body bulk and frame.  According to Mr Spark, he heard loud and course language, and went in to the office.  He testified that he saw the applicant standing over Mr Merks, and pushing him up against the wall.  He said that as he approached them, they were touching and he pushed in between him to separate them. In terms of the shouting and language, it was Mr Spark’s evidence, that it was not only the applicant who used course language, but the loudest and majority of it came from the applicant.

12       At some point during this incident, that was not entirely clear on the evidence, the dealer principal Mr Van Dale telephoned the office.  He was apparently away from the office on holiday at the time, but had a practice to ring in to keep in contact.  When he did this, he spoke with Mr Merks who informed of the events that morning.  Mr Merks had informed him about the failure by the applicant to clean his motor vehicle when requested, but most importantly, the incident that occurred in the office and the applicant's threatening behaviour.  According to Mr Van Dale, he did not regard the documentation of the Bain transaction as major, but was very concerned to hear of the abusive and threatening behaviour by the applicant.  It was Mr Van Dale's evidence, that he supported Mr Merks' decision, that the applicant be dismissed.  He accepted in evidence that he did not speak with the applicant to verify his version of events, prior to this decision being taken.  Mr Van Dale also testified that Mr Merks did not inform him that the applicant thought he was accused of misleading Mr Merks at the outset of the meeting in the office.

Consideration

13       I turn now to consider some of the relevant principles in relation to matters of this nature. It is well settled in matters such as these that the test as to whether a dismissal is harsh, oppressive or unfair is whether the right of the employer to dismiss an employee has been exercised so harshly or oppressively such as to constitute an abuse of that right: Miles v Federated Miscellaneous Workers Union of Australia, Industrial Union of Workers, Western Australian Branch (1985) 65 WAIG 385.

14       Additionally, in assessing a claim such as the present matter, it is not the province of the Commission to assume the role of the manager, but to consider the dismissal objectively and in accordance with the obligations imposed on the Commission pursuant to s 26(1)(a) and 26(1)(c) of the Act. Moreover, in objectively assessing the circumstances of the case, the practical realities of the workplace need to be considered and a commonsense approach to the application of the statutory provisions should be adopted: Gibson v Bosmac (1995) 60 IR 1.

15       It is also the case in this jurisdiction, that the lack of any procedural fairness in matters such as these can be a most important circumstance, but a failure to afford it may not necessarily render a dismissal unfair if the result would have been the same in any event: Shire of Esperance v Mouritz (1991) 71 WAIG 891.

16       Additionally, in circumstances where a dismissal has been effected summarily for misconduct, there is an obligation on the employer to establish on the balance of probabilities that as a matter of fact the misconduct has occurred: Newmont Australia Ltd v The Australian Workers Union, West Australian Branch, Industrial Union of Workers (1988) 68 WAIG 677.  Whilst this has been described as an evidential burden, it has also been held that it does not require the employer to establish that summary dismissal for misconduct was “justified”, but rather, requires the employer to establish by evidence, the existence of facts that would support the decision to dismiss summarily: Shire of Esperance per Kennedy J at 895.  That is in the context of the present matter, it is for the respondent to establish by cogent evidence, the existence of facts to support its decision to summarily dismiss the applicant for misconduct.  In my opinion, the evidential burden goes no further than this, as questions as to the procedure adopted by an employer to effect a dismissal for misconduct are matters relevant to an assessment overall of the fairness of a dismissal and the persuasive onus in this regard, remains with an applicant employee.

17       It is also the case, that a dismissal may be held to be harsh, oppressive or unfair, on the basis that it is either substantively or procedurally unfair: Bostik (Australia) Pty Ltd v. Gorgevski (1992) 41 IR 452.  However, it is important to recognise that all of the circumstances must be taken into account, and in the case of misconduct, the gravity of the conduct must be balanced against any suggested failure to afford procedural fairness: Byrne and Frew v. Australian Airlines Ltd (1992) 45 IR 178: Shire of Esperance per Nicholson J at 899; Bostik per Gray J at 466.

18       For example, if it can be established that given the gravity of the conduct complained of, affording procedural fairness would not have altered the outcome in any event, then such a failure will not of itself, render a dismissal harsh, oppressive or unfair.  Moreover, to conclude that procedural fairness alone may render a dismissal unfair, without considering the substantive performance or conduct issues surrounding the dismissal of an employee, and their gravity, would be to ignore the requirements of s 26(1)(a) of the Act, requiring the Commission in the exercise of its jurisdiction, to have regard to the substantial merits of the case.  In each case, it is a matter of judgement in the exercise of a discretion as to the weight to be apportioned to substantive and procedural factors.

19       In this case, I am satisfied on the evidence and I find that there were three essential complaints by the respondent concerning the applicant's conduct.  The first complaint, concerns allegations that the applicant failed to comply with the respondent's documented vehicle sale procedures, in particular regarding valuation approvals.  The second issue is the allegation that the applicant failed to comply with a lawful and reasonable direction, to clean the motor vehicle the applicant was driving on 19 April 2003.  The third issue, and in my opinion clearly the most serious, is the allegation that the applicant engaged in threatening and abusive behaviour towards his manager Mr Merks.

20       As to the first issue, I do not place much weight on the allegation that the applicant failed to comply with documentary procedures concerning the respondent's motor vehicle sales policy.  It is not necessary for me to find conclusively whether or not there had been a failure to comply, although it appears that the lack of a pre-sale valuation being obtained from Mr Merks, may have contravened the respondent's policy.  Furthermore, this did not appear to be a matter of any real concern to Mr Van Dale, when giving his evidence, about the incidents that occurred on the morning of 19 April 2003.

21       In relation to the second issue of the alleged failure to comply with the direction, on the evidence, I am not satisfied that there was a direction by Mr Merks for the applicant to clean the motor vehicle immediately, however I am satisfied that a direction was made that it be cleaned.  It was apparent however, that other events intervened between the time of the applicant's arrival at the respondent's premises and the termination of the applicant's employment, which overtook this particular issue.  In my opinion, I am not persuaded that great weight can be placed upon this matter and in any event, it was not raised by the respondent at the time, as a reason for the applicant's summary dismissal for misconduct.

22       It is the issue of the alleged threatening and intimidating behaviour that the Commission now turns to.

23       In relation to this issue, the only evidence as to the first incident is that of the applicant and Mr Merks.  There were no witnesses to the altercation that took place between them in Mr Merks' office.  There was evidence however, from Mr Spark, in relation to what he heard from where he was located, and the discussion he had with Mr Merks immediately after the first incident when Mr Merks walked from the used car office to Mr Spark’s location.  From the evidence, I am satisfied and I find that Mr Merks initiated the discussion with the applicant by suggesting to the applicant that he had misled Mr Merks about the Bain transaction.  Whether or not Mr Merks used profane language in suggesting this, as asserted by the applicant, I am not able to specifically determine one way or another, as there was no independent witness to the events.  However, I am satisfied on the evidence that whatever was said by Mr Merks, the applicant reacted and engaged Mr Merks in a loud and heated exchange.  This fact was supported by the evidence of Mr Spark, who testified he could quite clearly hear, as apparently could others, raised voices.  Importantly however, it was not only the applicant's voice that Mr Spark could hear, as he said both the applicant and Mr Merks were shouting, however the majority of the raised voices was the applicant's.  Additionally, Mr Spark confirmed in his evidence, that at times, both used course language. I am simply not persuaded it was all a one sided incident, as the agent for the respondent submitted to the Commission.

24       I therefore do not accept Mr Merks’ evidence, that throughout the initial stage of this incident in his office, he remained entirely calm as was asserted in his original statement and his oral testimony.  I am persuaded however, that it was the applicant who was the dominant participant in the altercation between them.  I also accept that Mr Merks was intimidated by the applicant as this was consistent with the evidence from Mr Spark that when he first saw Mr Merks when he came over from his office, he looked shaken.

25       The next issue is what occurred after the initial altercation in Mr Merks' office.  The evidence was and I find that the applicant left Mr Merks' office, obviously in a very angry state, and I accept that he probably did slam the office door, and he then returned to his own work location.  Thereafter, Mr Merks spoke with Mr Spark, who confirmed in his written statement, as I have observed above, made at about the time of the incident, that Mr Merks looked shaken.  This evidence is consistent with what Mr Merks said had just occurred.

26       In the applicant's office, an extension of the altercation took place.  I accept on the evidence, that when Mr Spark entered the office, he saw Mr Merks, standing up against the wall of the office, with the applicant standing over him and both were shouting.  I am of the view on the evidence of Mr Spark, that the applicant was very close to if not touching the body of Mr Merks, such that Mr Spark had to get between them to separate the two men.  I am satisfied on the evidence and I find, that in behaving in this way, the applicant engaged in threatening behaviour towards Mr Merks.  There was also an obvious size difference between the applicant, who is a large man of large build, and Mr Merks, who is a person of smaller stature and slighter build.  I accept on the evidence, that given the physical differences between the two men, that the applicant would have very much been “standing over” Mr Merks when in the larger office, during the second incident.  I find accordingly

27       On the evidence as a whole, I also accept that as a result of this altercation, both in his office and in the larger office area occupied by the applicant that Mr Merks did feel threatened and intimidated by the applicant's behaviour.  The obvious size differential between the two of them, no doubt contributed to this circumstance.

28       I am satisfied on the evidence that Mr Merks, backed up it seems by Mr Spark, told the applicant that he could not remain on the respondent's premises because of his behaviour.  That is, that his employment was being summarily terminated at that point.  This is so, notwithstanding some lack of clarity on the evidence, as to who had the lawful authority to engage and dismiss employees.  It was Mr Van Dale's evidence, that managers in the positions of Mr Merks and Mr Spark, did have such authority, but as a matter of courtesy, he was usually informed of the proposed course of action.  No issue however, was taken by the applicant concerning this matter, in the sense as to whether there was a valid termination of the employment contract or not.

29       I am also satisfied on the evidence, that at no time prior to the applicant's departure from the respondent's premises and hence his dismissal, did the respondent seek any explanation from the applicant as to the incidents that occurred in both Mr Merks' office and in the larger office occupied by the applicant.  In other words, the applicant was not afforded the opportunity, to put his side of the events to the employer.  Nor was there any consideration of other factors such as the applicant’s work record, length of service or alternatives to dismissal.  The issue that arises then is what is the consequence of this failure?

30       I am satisfied on the evidence, that whilst there may have been some level of provocation, in that the applicant considered he was being wrongly accused of misleading Mr Merks, his subsequent conduct towards Mr Merks, both in Mr Merks' office and later, in the larger office area, was unacceptable behaviour on any measure.

31       The issue in this matter is however, whether, if the applicant had been consulted by the respondent as to his view of events, and therefore been afforded procedural fairness, the outcome of the matter would have been any different.  I have considered this matter carefully.  On the assumption that the applicant would have informed Mr Van Dale that he considered he was provoked by Mr Merks, by being accused of misleading Mr Merks, and having regard to the evidence of Mr Spark, would Mr Van Dale's decision have been any different?  In the circumstances, consideration needs to be given to the circumstances of the employee and that of the employer.  From the perspective of the applicant, he has found himself in the position of having been dismissed and hence at the time, lost his livelihood.  From the perspective of the employer, the circumstances were such that an employee engaged in inappropriate threatening and abusive behaviour, not only to a manager with authority over him and to whom he was responsible, but also within the earshot of other staff and customers of the respondent.  The gravity of the conduct is to be taken into account by the Commission: Bostick at 17.

32       In the context of the present matter, I am satisfied that the absence of any inquiry at all as to the applicant’s version of the events and consideration of alternatives did amount to procedural unfairness to the applicant. Had there been an investigation into the incident by Mr Van Dale, it would seem to me that the issue of provocation would have been a live issue.  That is, it would have been necessary to hear from both the applicant and Mr Merks, and Mr Spark, before any judgement could be made as to whether the applicant was guilty of behaviour warranting dismissal, including summary dismissal, and importantly, whether there were any mitigating circumstances arising.  This would also include any consideration of Mr Merk’s conduct as well. 

33       It is also the case that it is not in every instance of fighting or threatening behaviour in the workplace, that summary dismissal for misconduct will be justified: Mt Newman Mining Co Pty Ltd v The Australian Workers Union, Western Australian Branch, Industrial Union of Workers (1983) 63 WAIG 2397; AFMEPKIU v Dampier Salt Operations Ltd 79 WAIG 2305; AFMEPKIU v John Holland Construction & Engineering Pty Ltd 79 WAIG 1302.  All of the circumstances of the case must be considered, as s 26(1)(a) of the Act plainly requires.

34       On balance, and having regard to the totality of the circumstances I am satisfied that the applicant has been, by the failure of the respondent to afford the applicant procedural fairness, deprived of the opportunity of putting issues to the respondent that may have caused it to consider alternatives to summary dismissal. Such factors could have included any conduct of Mr Merks in the incident, the applicant’s length of service and work performance and any other relevant matters.  I am therefore of the opinion that the applicant’s dismissal was harsh, oppressive and unfair. 

35       I now turn to the issue of remedy.  The applicant does not seek reinstatement or re-employment and in the circumstances, I am satisfied that neither would be practicable. In relation to compensation for loss, I apply the principles in the well-known decision of the Full Bench of this Commission in Bogunovich v Bayside Western Australia (1999) 79 WAIG 8.  I am satisfied, on the evidence given by the applicant, that after the dismissal which occurred, the applicant has actively sought alternative employment.  Tendered as exhibit A5 was a letter from a job search assistance provider referring to the applicant having been a client and his job search activities since July 2003.  As at the date of the hearing, the applicant had not been successful in obtaining alternative employment.

36       The applicant was remunerated on a base salary and commission basis. On the evidence before me, including that contained in exhibit A1, a summary of the applicant’s payments over his period of employment at the respondent, that the applicant’s average remuneration was some $885.48 per week, exclusive of payments made on termination of employment.  An average rate of remuneration may be used for the purposes of determining compensation for loss: s 23A(9) Act.  Given that the applicant has been unemployed since his dismissal to the date of the hearing, the applicant’s total loss is $38,961.49.  I find accordingly.  I am satisfied that the applicant has not earned any other income that should be deducted from this figure.  Given that from the applicant’s loss any sums in lieu of notice should be deducted, the parties will be directed to confer on the final sum.  The cap on compensation under s 23A(8) of the Act will then need to be applied.