FEDERAL COURT OF AUSTRALIA

Stevenson v Murdoch Community Services Inc [2010] FCA 648

THE COURT ORDERS THAT:

1.                  The Applicant is granted leave to amend her application to include reference to ss 659(2)(a) and (e) of the Workplace Relations Act 1996 (Cth) (the WR Act) and to include a claim for reinstatement under s 665(1)(b) of the WR Act.

2.                  Within 28 days of these Orders:

(a)                The Respondent pay a penalty of $7,500 to the Applicant; and

(b)               The Respondent pay an amount of compensation to the Applicant comprising six months remuneration, less the amount paid to the Applicant in lieu of notice at the time of the termination of the Applicant’s employment.

3.                  No order as to costs.

Note:    Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.

THE COURT ORDERS THAT:

1.                  The Applicant is granted leave to amend her application to include reference to s 42 of the Disability Discrimination Act 1992 (Cth).

2.                  The application is dismissed.

3.                  No order as to costs.

Note:Settlement and entry of orders is dealt with in Order 36 of the Federal Court Rules.
The text of entered orders can be located using Federal Law Search on the Court’s website.

and:

REASONS FOR JUDGMENT

I.          INTRODUCTION

1                                             Heather Ann Stevenson (Ms Stevenson) was employed by Murdoch Community Services Inc (MCS) from about September 1988 until the termination of her employment on 29 June 2009.  MCS is an incorporated association providing employment, residential and day programs for people with a disability.  Until her resignation on 28 May 2010, Ms Nancy McColl Bowen (Ms McColl Bowen) was the Chief Executive Officer of MCS. 

2                                             Ms Stevenson was a full-time employee of MCS and, at all relevant times, was the Co-ordinator of the Laundry Services area of MCS (the Laundromat).  A number of people employed in the Laundromat had a disability and were employed as supported employees.  It was part of Ms Stevenson’s role, as Co-ordinator of the Laundry Services, to coordinate the work of the supported and non supported employees in the Laundromat. 

3                                             Ms Stevenson filed two applications with the Court.  The first claim (VID 661 of 2009) alleges unlawful termination of her employment by MCS in contravention of the Workplace Relations Act 1996 (Cth) (the WR Act).  The second claim (VID 737 of 2009) is an application under s 46PO of the Human Rights and Equal Opportunity Commission Act 1986 (Cth) for compensation and other relief for alleged contraventions of the Disability Discrimination Act 1992 (Cth) (the DDA) by MCS and Ms McColl Bowen.  Both applications are based on the same factual circumstances and were heard together on 10 March 2010, 24 March 2010 and 26 May 2010.  

4                                             On the final day of the hearing, Ms Stevenson sought leave to amend her originating applications under both the WR Act and the DDA to better reflect the remedies sought and the basis of contravention. 

5                                             In her originating application under the WR Act, Ms Stevenson alleged that MCS contravened s 659(2)(f) of the WR Act.  The relief sought by Ms Stevenson under the WR Act was:

1.         Imposition of a penalty under s 665(1)(a);

2.         Compensation for loss of wages under s 665(1)(c); and

3.         Such further or other order as the Court deems fit.

6                                             However, in Ms Stevenson’s final submissions, she submitted that reliance was also placed on s 659(2)(a) and s 659(2)(e) of the WR Act and that the remedy she sought above all others was reinstatement pursuant to s 665(1)(b) because:

[M]onetary compensation alone is not sufficient to redress the detriment she has suffered as a result of termination of her employment, as a result of limited alternative prospects of employment and her long-standing association with and emotional attachment to [MCS].

Ms Stevenson further submitted that if monetary compensation was to be awarded, the equivalent of six months remuneration, together with a penalty, should be awarded.  Finally, she submitted that if reinstatement was not granted, the Court should:

[O]rder amendment of the Applicant’s Employment Seperation (sic) Certification to remove the assertion she was dismissed because of conduct or performance and reflect the fact she had a current WorkCover claim at the time of termination of her employment.

7                                             In her originating application under the DDA, Ms Stevenson alleged that MCS and Ms McColl Bowen contravened ss 5, 6, and 15 of the DDA.  In her supporting affidavit, Ms Stevenson relied on her submissions to the Australian Human Rights Commission (the HRC) which further alleged MCS had victimised Ms Stevenson in contravention of s 42 of the DDA.  Ms Stevenson initially claimed that MCS and Ms McColl Bowen discriminated against her by reason of her association with her disabled sister, Ms Lorraine Flanagan (Ms Flanagan).  However, during the course of the hearing and in her final submissions, Ms Stevenson submitted that she in fact had a disability, a thyroid condition, which was known to the Respondents.  

8                                             The relief sought under the DDA was:

1.                   A written expression that [Ms Stevenson] will be respected by [Ms McColl Bowen] and other management and employees of [MCS];

2.                   [Ms McColl Bowen] and other senior employees of [MCS] will undertake disability awareness training;

3.                   A written expression of support from [MCS] and [Ms McColl Bowen] of [Ms Stevenson’s] right to be Ms Flanagan’s carer without any criticism or negative attitudes being directed towards her by the Respondents;

4.                   Compensation for the pain and suffering caused by the actions of [MCS and Ms McColl Bowen]; and

5.                   Compensation for any legal costs arising from this complaint.

9                                             On the final day of the hearing, Ms Stevenson sought leave to amend her originating application under the DDA to include the victimisation complaint under s 42 of the DDA. 

10                                          The proposed amendments to the originating applications and whether leave should be granted will be dealt with later in these reasons for decision in the context of each application. 

II.        FACTS

11                                          Ms Stevenson commenced working at MCS in September 1988.  At all times relevant to these proceedings, Ms Stevenson was the carer of her disabled sister, Ms Flanagan.

December 2006 – August 2007

12                                          Before addressing the particular facts giving rise to the dispute between Ms Stevenson and MCS it is necessary to consider the development of the Policies and Procedures Manual (the Manual) at MCS.  The Manual, and its amendments, are relevant because it is these policies and procedures Ms Stevenson was alleged to have breached and it is specifically the amendments in January – March 2009 to the policies affecting the Laundromat which aggrieved Ms Stevenson. 

13                                          On her arrival at MCS in 2006, Ms McColl Bowen had concerns about the viability of the MCS organisation including the “lack of a basic, operating framework” and the lack of “documented policies or procedures around any activity”.  As a result, on or about 10 December 2006, Ms Elizabeth Vance Jones (Ms Vance Jones) was commissioned by MCS in conjunction with the Department of Human Services (DHS) to conduct a review and report on MCS and was asked to:

Develop and implement operational policies and procedures (excluding financial policies) based on a recognised quality management system and provide recommendations for a revised management structure to more effectively support the service / program activities of [MCS].

14                                          On 29 January 2007, Ms Vance Jones completed her review and concluded that there were “in effect, no operational procedures for staff to follow”.  In March 2007, Ms Vance Jones was engaged by MCS (with funding support from DHS) to develop a quality management system and manual procedure.  Between March and August 2007, Ms Vance Jones completed the Manual which she “developed in consultation with staff at [MCS]”.

15                                          On 10 August 2007, the Manual was substantially completed but several policies were still being developed.  The Manual was described by Ms Vance Jones as “not a static document” and, according to Ms McColl Bowen, changes could be made to the Manual based on a “continuous improvement model”.  Between August and December 2007, Ms Vance Jones attended MCS regularly to assist staff to learn how to implement the procedures, check their appropriateness and develop any revisions.  During this time, Ms Vance Jones held training sessions concerning the Manual.  Attendance registers of those meetings revealed that Ms Stevenson attended these training sessions. 

16                                          The evidence about the development of the Manual was not controversial.  What is of significance is that as at December 2007 none of the subsequent changes to the Manual relating to the Laundromat and proposed by MCS in January and February 2009 had been identified by Ms Vance Jones.

May 2008

17                                          On 5 May 2008, a driving incident occurred near the MCS workplace involving Ms Stevenson’s sister, Ms Flanagan, and Ms McColl Bowen.  As a result of the incident, driving restrictions were imposed on Ms Flanagan.  Theprecise details of the incident are not presently relevant and are the subject of separate proceedings involving Ms Flanagan: see Flanagan v Murdoch Community Services Inc [2010] FCA 647.  What is relevant for these claims is that Ms Stevenson contends that it was from the time of the incident involving her sister that MCS’ attitude towards her changed.  The Respondents dispute that contention and submit that the difficulties that existed between them were not connected with or related to the incident involving Ms Flanagan.

18                                          Later on 5 May 2008, Ms Stevenson was told that a meeting had been arranged between MCS, her sister and an advocate for her sister, Ms Debbie Verdon (Ms Verdon).  The meeting was to be held on 6 May 2008.  At approximately 4:30pm on 5 May 2008, Ms Stevenson telephoned Ms Sharon Davey, Manager of Client Services at MCS (Ms Davey), to find out what the meeting was to be about.  Ms Davey told her of the alleged driving incident.  During the same telephone call, Ms Stevenson cancelled the meeting.  She considered “it was not appropriate for [MCS] to decide on [her] sister’s behalf, who should be her advocate” and she believed that the alleged driving incident was not a work matter, but if serious, a police matter. 

19                                          The next day, 6 May 2008, Ms Stevenson was telephoned at work by Ms Sue Medlyn, the Quality Manager at MCS (Ms Medlyn), and asked to attend a meeting.  Ms McColl Bowen and Ms Davey also attended the meeting.  The alleged driving incident involving Ms Flanagan was discussed.  Although Ms Stevenson was not cross-examined on the contents of the meeting of 6 May 2008, her affidavit evidence was that she vigorously protested on behalf of her sister and that it was during this meeting that Ms McColl Bowen spoke aggressively to her and told her that she had a problem with Ms Stevenson being both a staff member and a carer of an employee.  In cross-examination, Ms McColl Bowen stated that she did not have concerns that Ms Stevenson was acting as Ms Flanagan’s carer but she “certainly understood that [Ms Stevenson] did” and that “it didn’t really matter who represented [Ms Flanagan] as long as somebody did”.

20                                          Two days later, 8 May 2008, Ms Davey contacted Ms Stevenson to enquire why her sister had not come to work.  Ms Stevenson’s evidence was that she told Ms Davey that her sister could not attend until the driving incident was resolved.  In response to a request that the reason for Ms Flanagan’s non attendance at work be put in writing, Ms Stevenson’s evidence was that she told Ms Davey to contact her sister’s advocate, Ms Verdon. 

21                                          The next day, 9 May 2008, Ms Stevenson received another telephone call from Ms Davey about her sister not being at work.  Ms Stevenson’s evidence was that she again told Ms Davey that her sister would not attend until the driving incident was resolved.  Ms Davey was not cross-examined about the meeting of 6 May 2008 or the telephone calls on 8 and 9 May 2008.  Ms Davey’s evidence was that she did not think Ms Stevenson’s dual roles as both an employee and carer of Ms Flanagan was a barrier to her properly communicating with Ms Flanagan.  Ms McColl Bowen’s evidence about the telephone calls of 8 and 9 May 2008 was that she “neither liked or disliked [Ms Stevenson’s] response” and that “Ms Stevenson was conveying information which I absorbed”.  This was the tone of her evidence throughout. 

22                                          On 12 May 2008, a meeting occurred between Ms Flanagan, Ms Verdon, Ms Kelly Wilson from Pinarc support services (a disability support service) and Ms Davey on behalf of MCS.  Neither Ms Stevenson nor Ms McColl Bowen attended this meeting.  A file note prepared by Ms Davey for Ms McColl Bowen about the meeting was tendered in evidence.  Ms Davey recorded that Ms Flanagan had stated she would “come back to work if [Ms Stevenson] told her to do so”.  Ms Davey stated in cross-examination that she “just simply wrote down what was said during the meeting” and disagreed with the suggestion by Ms Stevenson’s Counsel that she “believed Ms Stevenson had wasted [her] time by causing confusion over whether she was Ms Flanagan’s advocate or not”.  In response to questioning concerning whether she believed when Ms Stevenson was dismissed that Ms Flanagan would have come back to work at MCS if Ms Stevenson had told her to, Ms Davey said she assumed “if [Ms Flanagan] had said that at that time, later on the same thing would have been the case”.  Ms McColl Bowen said of the file note that the view expressed by Ms Flanagan was “of interest” but it made no difference to how she then proceeded in relation to Ms Stevenson.  Ms Davey’s evidence was consistent with the file note and I accept that the file note accurately records the substance of the matters discussed at the meeting.  

23                                          On 29 May 2008, Ms Stevenson was asked to make a WorkCover statement concerning the incident involving Ms Flanagan.  A copy of the witness statement was in evidence and was relied upon by Ms Stevenson as another “incident … of distress”.  The contents of the statement were not the subject of cross-examination and may be put to one side.  It is the circumstances in which she made the statement that are relevant.  Ms Stevenson’s evidence was that MCS “put huge pressure on [her]” to provide a statement.  Ms Stevenson characterised the request as a requirement for her to make a statement “against her sister”.  No witness for MCS was cross-examined about this matter.  Ms McColl Bowen’s written evidence described the situation as follows:

I am aware that [Ms Stevenson] was interviewed by … the investigators appointed by the insurer following a WorkCover claim by [Ms Flanagan].  [MCS] was required to identify those employees we believed would be relevant to [Ms Flanagan’s] WorkCover claim.  However, [Ms Stevenson] was not directed to attend the interview.  Neither I nor anyone else from [MCS] attended the interview between [Ms Stevenson] and the investigator.  I did not receive a copy of [Ms Stevenson’s] statement prior to her complaint to the Australian Human Rights Commission.  To my knowledge, at no time prior to her complaint did [Ms Stevenson] indicate that she did not wish to be interviewed.  It is my view that had I or [MCS] excluded [Ms Stevenson] from the WorkCover investigation that this may have been unfair to [Ms Flanagan]. 

24                                          During cross-examination, Ms Stevenson acknowledged that no person from MCS was present when she made her statement and that she only became aware recently that her statement was never disclosed to MCS.  She further stated that it was not explained to her that the reason for the WorkCover statement was because MCS was required to identify to WorkCover all persons who might be able to provide information.  I accept Ms Stevenson was distressed by the incident.  I do not accept she was required to make a statement “against her sister”.  MCS was merely fulfilling its obligations to WorkCover in the investigation of the incident involving Ms Flanagan.

June 2008

25                                          On 24 June 2008, Ms Stevenson was called to attend a meeting with Ms McColl Bowen.  A file note of the meeting entitled “Record of Counselling / Warning Form” was tendered in evidence.  (The word “counselling” was circled.  The word “verbal warning” was not circled.  This was the first and only formal record of counselling.  There was no record of any formal warning having ever been given to Ms Stevenson).  Under the heading “Details of performance / behavioural problem discussed with employee” the file note recorded:

Heather becomes agitated, and then very angry with very little provocation.  Once she is in this state, staff find it very difficult to reason with her – or to have any conversation with her.  Heather raises her voice; uses bad language; does not allow the other person to speak; makes claims that are “over the top” or silly eg “you are trying to get rid of me!”  Code of conduct?

26                                          The file note then recorded that Ms Stevenson was informed of a number of incidents alleging inappropriate behaviour by her.  The first complaint alleged inappropriate language was used when Ms Stevenson was speaking on the telephone with Ms Davey.  The file note then set out Ms Stevenson’s response to these matters.  The note records her response in the following terms:

*Frustration – asking for help but response is not helpful

- Regular occurrence

Work load is extreme & need to help

No computer manual

Medication.

- Does not swear - …

HS does not agree with process.

27                                          The file note recorded that Ms Stevenson acknowledged the problem (expression of frustration and emotion) and then identified the following four items as the agreed action to remedy the problem:

1.                   HS will try keep emotional frustrations under control.

2.                   offer from MCS re counselling.

3.                   PMP to be fast tracked – July / August  - 22^nd July 3.15-4.20.

4.                   Sharon [Davey] to try and spend time at Laundromat during busy time.

28                                          Ms Stevenson disputed that the file note accurately recorded what transpired at that meeting.  In cross-examination, Ms Stevenson said that Ms McColl Bowen only discussed one incident with her (involving a phone call where Ms Stevenson used the word “crap”) and that no other incidents were discussed.  However, she also stated that the “other three were just written on the piece of paper … I was not told what they were about but I got told it was four complaints”.  Ms Stevenson denied the other incidents recorded in the file note occurred and gave evidence that she believed that the allegations set out in the file note were made “in order to get back at [her] for [her] support of [her] sister”.  She further stated she should have been given a right of reply before the meeting “so [she] could go to a meeting with a bit of fairness and know what [she was] going there for”. 

29                                          The evidence did not identify who were the other attendees at the meeting.  In cross-examination Ms Stevenson stated “Sharon Shepherd was there at the meeting with me and could have verified that … half of that document was already written before I even walked into the meeting”.  Ms Shepherd, a former support worker at MCS, was called as a witness for Ms Stevenson.  Ms Shepherd did not give evidence about the meeting.

30                                          I reject Ms Stevenson’s evidence that the file note did not accurately record the matters discussed at the meeting and that only one incident was raised at that meeting.  Ms McColl Bowen prepared the file note on the same day as the meeting.  Counsel for Ms Stevenson did not cross-examine Ms McColl Bowen on the contents of the file note.  The only relevant cross-examination of Ms McColl Bowen was the suggestion from Counsel for Ms Stevenson that Ms McColl Bowen “knew very well that Ms Stevenson was under stress because of her workload”, a claim which Ms McColl Bowen rejected.  Ms Davey provided a similar response when the same suggestion was put to her.  The evidence of Ms McColl Bowen was supported by and is consistent with the contents of the file note and in this respect is to be preferred. 

July – October 2008

31                                          The next event in the chronology relied upon by either Ms Stevenson or the Respondents was a dispute which arose between July and October 2008 concerning Ms Stevenson’s dermatitis condition which primarily affected her hands.  It was common ground that Ms McColl Bowen requested Ms Stevenson to make a WorkCover claim for reimbursement for the cost of dermatitis cream she required to treat the condition. 

32                                          In early July 2008, Ms Stevenson visited a medical specialist in Melbourne about the condition of her hands.  A copy of specialist’s report was provided to MCS.  After reviewing that report, Ms McColl Bowen sent two memoranda to Ms Stevenson.  The first, dated 11 July 2008, stated:

Following your visit to Melbourne recently, I have received a copy of the medical specialist’s report about the condition of your hands.

The report establishes that your skin condition is connected to the work that you do, and that there are clear OH&S risks in your continuing to perform your role in the way you have been doing to date.

As of Monday, 14^th July 2008, I am directing you to wear gloves at all times at the Laundromat when you are involved in washing, ironing and folding activities.

I will be giving further consideration over the next week to the implications of the report and will be in contact with you to discuss how we might resolve this issue.

33                                          Five days later, 16 July 2008, a further memorandum was sent by Ms McColl Bowen to Ms Stevenson entitled “Issues around your role at MCS” which stated:

I refer to my Memo to you dated 11^th July 2008.  I have further considered this matter and the medical report from Dr. Sagal (sic) in relation to irritation / eczema evident on your hands.

I note the following:

·         Washing, folding and ironing is an inherent part of the current Laundromat Supervisor role that you perform (from your report to Dr. Segal, those activities take up to 32 of the 36 hours you work per week).

·         The Laundromat is a relatively small business unit.

·         You are frequently the only worker without a disability who is on duty in the Laundromat.

·         Workers with a disability frequently need assistance from you in the capacity of Laundromat Supervisor.

·         Dr. Segal suggests that you see a dermatologist for a review of your condition.

Given the above points:

·         You need to continue to wear gloves when engaged in washing, ironing or folding at the Laundromat; and

·         We will organise as soon as possible an appointment for you [to] see a dermatologist during your normal working hours.  The dermatologist will supply us with a report clarifying the causes, symptoms and treatment or other resolution of your condition.

Sue Medlyn will be in contact with you shortly to arrange your appointment with a dermatologist.

Please feel free to contact me if you wish to discuss any aspect of this memorandum.

(Emphasis added).

34                                          The dispute then intensified.  The evidence disclosed that Ms Medlyn, the person responsible for WorkCover matters at MCS, did arrange an appointment for Ms Stevenson to see a local doctor to obtain a referral to a specialist and then an appointment with a specialist.  That appointment ultimately replaced a previous appointment Ms Stevenson had made with her general practitioner.  Ms Stevenson was advised of the appointment by a memorandum issued to her on 8 August 2008 by Ms Davey which stated:

This is a reminder that Sue Medlyn, as the senior staff member dealing with WorkCover issues, will make the appointment for you with the local doctor in order to obtain a referral to a specialist, in regard to your skin condition.  Sue will also make the appointment with the specialist.  [MCS] will pay for that consultation and for the subsequent specialist appointment.

If you choose to make an appointment with the doctor for personal reasons, you are free to do so but [MCS] will not pay for such consultations.

Sue will talk to you next week about making the WorkCover related appointment with the local doctor.

35                                          Ms Stevenson’s evidence was that the third memorandum (dated 8 August 2008) was issued on the day she arranged to see her own general practitioner and that Ms Davey rang her general practitioner while she was seeing the doctor and requested that her medical report and referral be sent to MCS and not given to her.  Ms Stevenson also gave evidence that the date, time and name of the specialist she was to be referred to were all changed by Ms Davey.  Ms Stevenson disputed the entitlement of MCS to make these changes without her knowledge or consent and cited this incident as another example of the growing tension between her and MCS.  I accept that MCS arranged an appointment for Ms Stevenson to see a specialist about her skin condition and did so because MCS was able to obtain an appointment with the specialist months earlier than may otherwise have been the case.  I do not accept that MCS took that step as part of a campaign to upset Ms Stevenson or as retaliation “in order to get back at [her] for [her] support of [her] sister”.  On the contrary, I accept the evidence of Ms McColl Bowen that MCS took the step to ensure that Ms Stevenson obtained specialist treatment as early as possible.  Ms Stevenson ultimately consulted a dermatologist and a further memorandum was sent by Ms McColl Bowen to Ms Stevenson on 16 October 2008 entitled “Your hand dermatitis / Workcover claim” which stated:

I refer to my Memo to you dated 16 July 2008 in which I noted that washing, folding and ironing are tasks which must be performed daily by the Laundry Service Coordinator. 

You have now attended a dermatologist who has assessed your condition and provided a report which advises the following:

·         You should use a cloth [to] towel dry your hands

·         You should use a hand cream he recommends

·         You should apply a topical steroid he recommends

·         You should wear “cotton gloves inside rubber gloves or plastic gloves for any wet work or handling that involves potential chemical exposure”.

[MCS] takes our OH&S responsibilities very seriously.  We do expect that you will follow the dermatologist’s instructions.

Please note that any failure on your part to comply may result in disciplinary action.

36                                          Then in October 2008, Ms Stevenson applied for unpaid study leave.  Ms Stevenson gave evidence that MCS was reluctant to grant her this leave and that Ms McColl Bowen told her she did not have the “brains” to do the course.  This alleged incident was cited by Ms Stevenson as another example of the growing tension between herself and MCS and of the Respondents’ changed attitude toward her.  There is little doubt that MCS was reluctant to grant her study leave.  Ms McColl Bowen was not cross-examined about this matter.  Ms McColl Bowen did however give uncontroverted affidavit evidence that she did want to know more about Ms Stevenson’s proposed course of study and that “the impasse was resolved with the assistance of the Health Services Union [(HSU)]”.  As part of the resolution of that dispute, Ms Stevenson was to provide a written assurance that the study was relevant to her employment and notify Ms McColl Bowen of the topic for her thesis. 

December 2008 – March 2009

37                                          Between 24 December 2008 and 31 March 2009, Ms Stevenson took extended leave from MCS comprising annual leave and long service leave.  During this time, the relationship between MCS (and in particular Ms McColl Bowen) and Ms Stevenson continued to deteriorate. 

38                                          In January 2009, Ms Davey expressed concern within MCS that there was not enough information for casual Laundromat staff employed during Ms Stevenson’s absence to run the Laundromat adequately.  As a result of these concerns, changes were made to the Manual concerning the operation of the Laundromat:  cf [12] to [16] above.  The changes were said to include additional details on various tasks including completion of a job book, laundry pick up and delivery, daily float and closing responsibilities. 

39                                          On 24 February 2009, Ms McColl Bowen sent a letter to Ms Stevenson informing her of these changes to the procedures in the Laundromat.  That letter provided:

… I wish to alert you to some changes in laundry services work practices which were introduced in January.  Some changes had to be introduced urgently, in your first week of absence, because the replacement supervising staff were not able to manage the laundry service with the limited information they had available to them.  Neither the Policy and Procedures Manual nor the Information Folder at the Laundromat provided the details the staff needed in order to manage the business well.

To overcome this difficult situation, senior staff developed and implemented some clear procedures around cash payments by customers, cash floats, machine feed coins, as well as how each job is tracked through the Laundromat.  These procedures are now working well, and have been documented, ready for inclusion into the MCS manual.

It is unfortunate that you, as the Coordinator of Laundry Services, were unable to participate actively in the development and implementation of these changes.  However, we shall arrange for a detailed handover, on your first day back at work, so that you are supported to become familiar with the new arrangements quickly.  We will also welcome your suggestions for further improvements.

40                                          The next day, 25 February 2009, Ms Stevenson sent a letter to the President of the MCS Management Committee lodging a grievance against Ms McColl Bowen and Ms Davey.  The letter provided:

On the 25/02/09 I received the letter from the CEO of MCS.  I was deeply distressed by its implied content.

I wish to place a grievance on both Nancy McColl Bowen CEO and Sharon Davey CSM.

I have been solely responsible for the Laundromat for 15 out of 20 years and never before have there been any issues with the procedures in place or work performance in any area.

In her letter to me Nancy implies that I have been negligent in the weeks / months leading up to my annual / long service leave by not providing adequate information to relieving staff.

I strongly contest this as I was not permitted to have any input into the preparations for this years (sic) Christmas break.  The staff members who usually cover the Laundromat during this period are both permanent-part time staff who are confident in running the business for an extended time and who were both refused their usual occupation for this time of year.  They were both forced to take annual leave for a time during this period.  This is despite repeated requests from both to perform their usual duties as per the last few years.

This year when December 2008 came and I was preparing to arrange leave requirements for the Laundromat, I asked Sharon Davey on serval (sic) occasions who was to be relieving me, I was told curtly it had nothing to do with me.  When I asked if I needed to do any thing or prepare a written statement of instructions Sharon said no.

I was not permitted to know who was to be covering the Laundromat nor allowed to train new a new casual staff member to manage the business, not even a single shadow shift was permitted.  This shadow shift practice is currently in place in all other employment areas and also respite and day services.

There as (sic) been a steady reduction in facilities needed to perform the work required as a co-ordinator of the Laundromat, removal of computer system/internet (creating isolation and crippling my ability to complete EAP’s etc), reduction in assistants (sic) hours from 20 hours per week to just 8.  A casual is now employed for 1 ½ hrs per week to cover my lunch break on 3 days.   I am not permitted to call in any staff if business needs require it.  Deliveries are now done in allocated client free time (paperwork time) which may not suit the customer’s needs.  I no longer have the ability to negotiate contracts as I have done successfully in the past.  I am not permitted to be innovative in delivering a successful Laundromat operation that supports up to 7 clients on any given day.  There is no consultation or information sharing from management and my opinions are not valued or respected.

My extensive experience is not being utilised to the benefit of MCS and my current studies (Advanced diploma in business management) are not being supported either financially or through paid study leave.  I am completing this study to enable myself to more effectively manage the Laundromat business and expand my future employment options with MCS.

I believe this behaviour and these measures were deliberately set so as to assist management to performance manage my position out of existence.

I have been subjected to blackmail as witnessed by Sharon Shepherd, had unachievable Laundromat goals placed upon me and very unpleasant letters from the CEO.  I am not willing to accept responsibility for the need for changes that have been made in my absence and without my input at the Laundromat.  As written in Nancy’s letter delivered while I am on long service leave.

Approximately 8 months ago my sister was put on work cover due to a conflict with the CEO and it is still unresolved.  I believe this conflict was another management tool to pressure another permanent staff member into resignation.  24 staff members have left this service taking their experience, qualifications, intellectual property and on ground knowledge to be snapped up by rival services.

I find the organised handover of my first day back to be insulting as the changes implemented have been done so only while I am absent and unable to have input into them.  My credibility has been undermined and the implied negligence is without just cause.

41                                          Two observations can be made about these letters.  First, the tensions between MCS and Ms Stevenson were self evident from the tone of these letters.  Secondly, the letter sets out Ms Stevenson’s views and dissatisfaction with MCS.  It will be necessary to compare the form and content of this letter with the form and content of later correspondence provided by Ms Stevenson.

42                                          On 18 March 2009, Ms McColl Bowen (not the President of the MCS Management Committee) responded to Ms Stevenson’s letter.  The letter, signed by Ms McColl Bowen, stated that Ms McColl Bowen would handle the issues raised in accordance with MCS’ Grievance Procedures.  The letter suggested a meeting to discuss the issues and attached a draft agenda which listed the following items:

1.         Arrangements put in place to cover [Ms Stevenson’s] extended leave over December 08 to March 09.

2.         Reduction in supports available to the Laundry Services [C]oordinator:

            a.         Computer email

            b.         Fewer hours of second supervisor

            c.         Crisis support

            d.         Client-free time

3.         Negotiation of contracts by superviser (sic).

4.         Consultation with management.

5.         Heather’s studies.

6.         Performance management process.

7.         Blackmail.

8.         Unachievable goals.

9.         Proposed handover on Heather’s return.

10.        Changed, draft procedures.

The final item, item 10, was handwritten.

43                                          Ms Stevenson did not respond by 24 March 2009.  Ms McColl Bowen sent another letter to Ms Stevenson.  That letter (dated 24 March 2009) provided:

I have not heard from you regarding my suggestion that we meet to discuss the grievances you detailed in your letter dated 25^th February to the President of the Committee of Management.  I am aware that you will return to work next Tuesday, 31^st March, and that many of your grievances concern your role as Laundry Services Coordinator, and the changes which have been implemented during your three month absence.

I therefore would like to meet with you at your normal starting time of 8.15am on Tuesday, 31^st March, in my office at Long Street, so that we may discuss your grievances and the changes to procedures at the Laundromat, prior to your re-commencing your role there.

This request follows the MCS Grievance policy and procedures, which requires that a person with a grievance sits down with the person or people with whom she has a grievance, in order to try and reach a resolution.

You may provide me with a list of issues which you wish to discuss, or a list of issues which you do not wish to discuss.  If you do not provide me with any such list, I shall use the draft agenda sent to you in my letter dated 18^th March.  To that agenda, I wish to add an item about the Laundromat changes to procedures.

I look forward to welcoming you back to work next Tuesday, and to participating in a positive and productive discussion of issues at 8.15 am in my office.  Please note that a replacement supervisor will be rostered on in the Laundromat, so that the laundry services team will undertake their usual duties during our meeting time.  

44                                          On 31 March 2009, Ms Stevenson returned to work.  On that morning, Ms Stevenson attended a meeting with Ms McColl Bowen, Ms Davey and Mr Derek Bell of the HSU.  Ms Stevenson’s recollection of the incident was that the meeting “followed the Respondent’s (sic) agenda and did not address the scope of [her] workplace grievances”.  However, Mr Bell, who was called to give evidence as part of Ms Stevenson’s case, accepted in cross-examination, that it “would be fair” to say that Ms Stevenson’s concerns were listened to and taken into account by Ms McColl Bowen and MCS during the meeting.  What those concerns were was not explained.

45                                          At the conclusion of the meeting on 31 March 2009, Ms Stevenson received a copy of revised procedures for Laundromat operations and was “inducted” back into the Laundromat by Ms Davey.  At the hearing, MCS could not identify what revised procedures document Ms Stevenson was given on 31 March 2009.  Ms Stevenson tendered a document she believed had been handed to her on 31 March 2009.  The document bore the handwritten words “Draft” and “Given to me by Sharon Davey on the 31^st March 2009” in the top right hand corner.  The policy name and number under the heading “Section 8 - Business Services Management” was “8.1 … Laundromat Operations”.  The document was seven pages long and listed 15 procedures that the Laundromat Co-ordinator was required to implement.  In cross-examination, Ms Davey was shown the document identified by Ms Stevenson.  Her evidence was that she could not recall whether that document was the one she handed to Ms Stevenson on 31 March 2009 and later identified other pages of the Manual as the version she handed to Ms Stevenson.  The version of the Manual identified by Ms Davey was different to the document produced by Ms Stevenson in a number of respects.  First, the policy number was different – it was an earlier version.  Secondly, the document was only six pages in length.  Finally, there were 17 procedures that the Laundromat Co-ordinator was required to implement, however the description of those procedures was less detailed than the version provided by Ms Stevenson.  I accept that it was more probable than not that the document produced by Ms Stevenson was the document handed to her on 31 March 2009.

46                                          From Ms Stevenson’s perspective, there were a number of problems with what had occurred prior to and on 31 March 2009.  I will identify three.  There were others.  First, she did not accept the factual foundation for the changes in the procedures of the Laundromat.  Secondly, she was unhappy with the process by which those changes were implemented and, thirdly, she claimed to feel disrespected and humiliated about having to be inducted back into a Laundromat which she had coordinated for in excess of 15 years. 

47                                          As noted earlier, Ms Shepherd, a support worker at MCS for approximately seven years until 10 March 2009, was called to give evidence as part of Ms Stevenson’s case.  Ms Shepherd assisted Ms Stevenson in the Laundromat and ran the Laundromat on occasions when Ms Stevenson was on leave.  Ms Shepherd’s evidence was that Ms Stevenson ran the Laundromat “efficiently”.  She was cross-examined on her understanding of the Laundromat policies that were in place in the period she worked in the Laundromat.  Counsel for Ms Stevenson did not explain how this evidence was relevant to Ms Stevenson’s case.  It may be put to one side.

48                                          During April 2009, the situation worsened.  Ms Davey gave evidence that during the afternoon of 1 April 2009 she asked Ms Stevenson if she had any questions regarding the new procedures and that Ms Stevenson responded saying she understood them.  However, Ms Davey’s evidence was that on 21 April 2009 she was told by Ms Stevenson that she had not looked at the procedures.  Ms Stevenson was not cross-examined about these incidents.  Ms Stevenson’s evidence was she received the amendments to the procedures and noted that there were “major changes”. 

49                                          That was not the only problem during April.  On 14 April 2009, Ms McColl Bowen sent a memorandum to Ms Stevenson concerning her working hours which noted that since she had returned to work on 31 March 2009, Ms Stevenson had left the workplace earlier than her roster specified.  The memorandum recorded that Ms Stevenson’s sign out times were earlier than her roster specified on the following days and times:

2 April - 4.15pm - 6 min early

3 April - 3.55 pm - 6 min early

6 April - 4.17pm - 4 min early

7 April - 4.15pm - 6 mins early

8 April - 4.10pm - 11 mins early

9 April - 4.10pm - 11 mins early

The memorandum concluded by stating that Ms Stevenson would be required to meet with Ms Davey on a fortnightly basis “so that issues, such as this one, may be resolved very quickly”.  Ms Stevenson’s evidence was that she was authorised to leave work early.  The source of that authority was not identified.  Counsel for Ms Stevenson suggested the allegations were “trivial”.  Whether the memorandum was justified, and whether it was trivial, is not necessary to determine.  What is clear is that at this point in time MCS had identified a number of alleged issues with Ms Stevenson’s work performance.  It is the manner in which MCS dealt with those issues that gives rise to these proceedings.

50                                          On 19 May 2009, Ms Stevenson allegedly received another memorandum from Ms McColl Bowen concerning inappropriate behaviour in the workplace.  It is necessary to record this allegation because the memorandum was not tendered in evidence.  The memorandum was referred to in a letter from MCS to Ms Stevenson of 29 June 2009 terminating Ms Stevenson’s employment.  The contents of the memorandum were not in evidence.  Mr Bell referred to the contents of the memorandum on 23 June 2009 (see [69] below) in the following terms:

The original complaint against her was sent to her on the 19^th of May, 2009.

The matter originally concerned an invoice dated 27 April, where it is alleged Ms Stevenson made a purchase contrary to the organisations policies.”

In cross-examination, Ms Stevenson acknowledged receiving this memorandum by email from Ms McColl Bowen.

51                                          On or about 2 June 2009, Ms Stevenson lodged a complaint with the HRC stating that the actions of the Respondents toward her “have been directly related to her role as Ms Flanagan’s carer”.  Although the complaint form was dated 28 May 2009, an email from the HRC noted that it received the complaint on 2 June 2009.  At this point in time, Ms McColl Bowen and MCS were not aware of the HRC complaint.

52                                          On 5 June 2009, Ms McColl Bowen sent another letter to Ms Stevenson entitled ‘Allegations of unsatisfactory performance and conduct’ (5 June letter).  The 5 June letter contained 19 allegations of poor behaviour in the workplace.  For reasons which will become evident, it is unfortunately necessary to set out the entirety of the 5 June letter. 

Dear Heather

Allegations of unsatisfactory performance and conduct

We write further to our memorandum of 19 May 2009.  [MCS] has received a number of allegations with respect to your behaviour in the workplace.

The allegations are as follows:

Failure to follow the policies and procedures of Murdoch

1.         On … 13 May 2008 at 10.15am Sue Medlyn delivered mail to the [L]aundromat, and found you in the backyard of the [L]aundromat, smoking, with a second staff member, Sharon Brooks.  Six supported employees were left unsupported in the workroom.

On … 5 June 2008 at 12.40pm, Lynne Goodwin went into the [L]aundromat through the public access area and found three supported employees in the workroom by themselves.  You were in the backyard, smoking, with two other staff members.

Specifically, it is alleged that you often leave the supported employees without support in the workroom, in order to smoke outside, sometimes with a visitor.  This is a breach of Procedure 8.9.8 which states that supported employees are not to be left unsupported.

2.         On … 7 July 2008, Sharon Davey was organising Alan Roberts, the local security guard to open and lock up the [L]aundromat, so that the public area was accessible for as long as possible.  Alan alerted Sharon to the fact that, some time ago, you had allowed David Marsh, a friend of yours, to have a [L]aundromat key so that he could use the machines in the middle of the night.

3.         On … 8 December 2008, several senior DHS officers visited me in order to discuss a range of issues.  As they were leaving, they asked whether they could drop into the [L]aundromat in order to check on the emergency exit signage.  Because I had another appointment, I asked Eril Sherwell, the Coordinator Gardening Services, to take them down there.  Eril returned very upset, saying that you behaved very rudely to these important visitors.  You acted as if they were suspicious people, you demanded to be introduced to them, and they were clearly embarrassed.  They left as quickly as possible.

Specifically, on this occasion you acted in a way which may have compromised our relationship with an important funding body, namely the Department of Human Services.

4.         On 1 April 2009, Sharon Davey, Manager of Client Services, asked if you had any questions about the new policies and procedures that had been implemented during your absence on long service leave.  You stated that you had received a handover regarding the new policies and procedures and you knew all about them. 

On … 7 April 2009, you admitted to Sue Medlyn, Quality Manager, that you had not looked at the new policies and procedures that had been implemented during the period of your absence on long service leave.

Subsequently, on 21 April 2009 at a supervision meeting with Sharon Davey, she again asked if you had any queries about the new policies and procedures.  You then admitted that you had not had time to look at them. 

5.         On 27 April 2009, you personally arranged for a purchase of [L]aundromat powder from Landmark, St Arnaud.

Specifically, this is in breach of Policy 4.9 Purchasing.  Procedure 4.9.1 directs that all purchases are to be arranged by the Corporate Services Department.  Further, you were reminded about the contents of this policy in a memorandum from Sharon Davey, Manager of Client Services, dated 30 March 2009.

6.         On 27 April 2009, you asked a supported employee to collect and sign for the [L]aundromat powder from Landmark, St Arnaud.  This is in breach of Procedure 4.9.1 which states that supported employees do not have authority to sign off on any purchases.

7.         On 1 May 2009, you gave a supported employee some notes (paper money) and asked her to get change from the bank.

Specifically, this is in breach of Procedure 8.9.6 Daily Administration which states that Corporate Services will undertake the banking which was previously undertaken by the [L]aundromat staff.

8.         On 20 May 2009 at the Coordinators’ meeting, you reported that supported employees in your area had been doing puzzles during their working hours because there was no work to be done.

Specifically, this is in breach of Procedure 8.9.10 (previously 8.9.12) Other Laundromat Tasks, which states that supported employees are to undertake a range of other tasks when laundry work is not available.  A full list of other tasks is provided in the Laundromat Information Folder which is kept in the workroom.

9.         At the Coordinators’ meeting on … 20 May, you reported that supported employee, MH, had been ringing her mother during the working hours, to tell her that she (MH) was bored because there was no work to do.

Specifically, you were allowing a breach of Procedure 4.4.2 which states that “Personal mobile phones will be turned off when staff and supported employees are at work.”

10.        On … 1 or … 2 June 2009, you placed two applications for leave in the mail slot of the Manager Quality Systems.  However, the Manger Client Services is your supervisor.  She signs off your time sheets and approves your annual and sick leave applications.  The Manager Quality Systems has no authority to approve your leave application.  In addition, you failed to complete the section of each application detailing what program management arrangements you would be putting into place during your absence.

Specifically, this is a breach of procedure 3.2.6 Leave and failure to complete HRM 314 Application for Leave appropriately.

Failure to manage the [L]aundromat business unit efficiently

11.        You have failed to arrange the workroom in a way which ensures the security of your till.  Your usual practice has been to leave the till open near the workroom door, within easy reach of people using the public [L]aundromat.  The till was removed to your office area during your absence early this year, but I am told that it remains open, displaying all the cash.  This is despite my memorandum to you dated 8 October 2008 wherein I direct you in Point 6 to “keep the till drawer closed when not in use”.

12.        You have allowed/encouraged customers to enter the workroom and to stay chatting, when supported employees are working with hot irons and the pressing machine.  This is an OH&S issue.  You were directed to restrict access to the workroom in a memorandum from Sharon Davey on … 24 July 2008.  However, you have admitted to Sharon on … 28th April 2009 that customers continue to walk into the workroom with their baskets of laundry.  You have resisted the trialling of a desk/table at the workroom entrance where customers could place their baskets; and instead, you have scattered other items on this table. 

13.        In July, August and September 2008, I was informed by the Corporate Services staff that a total of $270 had not been collected from cash customers who had picked up their laundry items.  When I questioned you about this, on Tuesday 7 October 2008, you stated that you were frequently not aware of money coming into, and going out of, the [L]aundromat.  You believed that the supported employees sometimes accepted cash payments from customers when you may have been out the back smoking, or busy with other laundry duties.  You admitted that you generally did not follow up cash customers who had not paid. 

14.        When you went on long service leave in December 2008 you failed to ensure that replacement staff had access to the information they needed to manage the business.  A folder containing scraps of paper was on the work table, but replacement staff found that neither that folder (Laundromat Information folder) nor the Policy and Procedures Manual included adequate details or tasks to be undertaken.  Some regular customers and pick ups/deliveries were not listed.  Supported employees provided some information, and otherwise, replacement staff had to refer to the Manager Client Services or to the Coordinator Gardening Services, who had worked in this area some time ago. 

15.        Sue Medlyn was approached by a member of the public on Friday 3 October 2008 in the main street of St. Arnaud.  This person wanted to know how [L]aundromat fees were calculated because she was regularly charged $16 for a basket of ironing when Brenda was on duty, but she was charged $25 per basket when you were on duty.

Customers such as Aileen Hewitt, Mark Swanton and others, have been charged less than the Price List, resulting in an overall loss for MCS on many jobs.

On … 15 May 2009, Dana Decker worked in the [L]aundromat and both Colleen Rusk and Alison Fahey picked up their baskets of completed ironing.  You had told them that the cost was $12 each, but Dana said that the baskets were full and should have charged at $16.50 according to the Price List.

Specifically, it is alleged that you frequently breach Procedure 8.9.6 Daily Administration (previously 8.9.9 Receipt of Laundry) which refers to the Laundromat Price List BSM 871 and the Laundromat Product Price List BSM 870 as the basis for laundry services charges. 

16.        Fees charged do not always cover what it costs MCS to provide the service, resulting in an operating loss for Murdoch.  For example:

•           HACC customers are charge $8.80 for a load of washing.  However, MCS costs include $6-$7 worth of coins in machines, laundry detergent and the time it takes for a worker to load the machines and to fold items.

•           Greasy overalls require an extra cycle in the industrial washing machine ($6) and laundry detergent, neither of which is charged for.

•           Red Line de-greaser is used for greasy items but is frequently not charged for.

•           You have charged the local bakery just $5 for wash/dry/fold of between 20 and 30 tea towels.  You did not charge them any pick up or delivery fee.  The amount of $5 does not cover the cost to MCS of washing, drying and folding the tea towels.  During your long service leave, this situation was noticed and Sharon Davey negotiated a more reasonable price with the bakery.  MCS now charge them $11.20 to $13.20 for the same service (depending on the number of tea towels).

•           Public customers pay $2 to receive a small box of laundry powder.  The actual cost of the box is almost $2.10.

17.        On 11 February 2009, a supported employee (PR) told the replacement staff member (Dana Decker) that you take money out of the till to pay for personal items, such as the local paper or any other purchase, business or personal that you make during the day.  No receipt for any of these items has been sighted by Corporate Services staff.

Specifically, it is alleged that you have breached Policy 4.9 Purchasing, Procedure 4.9.1 which details how purchasing is to occur with Corporate Services receiving invoices, receipts and other paperwork so that income and expenditure may be kept separate and then reconciled.  Also Procedure 4.9.7 Petty Cash, which states that “At no time is any money to be take from the day’s takings to be used a Petty Cash.”

18.        You have failed to properly manage the [L]aundromat in that you allowed supported employees to sleep or to do puzzles when they should be working.

Specifically, on 1 May 2009, Dana Decker, supervisor, entered the [L]aundromat and found one supported employee (KW) asleep at the work table while another was doing puzzles.  This was despite the fact that on the previous day you had attended an EAP meeting where it had been decided that the supported employee’s should not be allowed to sleep at work.

19.        During the week beginning 18 May 2009 you spoke with Janelle Patching of Corporate Services about a large order for cleaning products which had been placed with you by the Rex Cinema in Charlton.  Janelle noted that the Rex Cinema was not listed with MCS as a customer, although you stated that they had been placing orders for cleaning products for some years.  Janelle asked what mark-up you had put on their order, and you said you knew nothing about mark-ups.  When Janelle checked [an] old [L]aundromat receipt book she found a receipt you had written to the Rex Cinema in October 2006.  The amount charged to the Rex Cinema by you was the product cost, which MCS had paid our supplier, less GST.  No mark-up had been added.

Specifically, it is alleged that:

(a)        you have been selling cleaning products at a rate which results in a loss to MCS.

(b)        you have little understanding of GST and its implications for the [L]aundromat business.

(c)        you have little understanding of retailing practices, and their application in the [L]aundromat business.

(d)        you have breached Policy 4.8 Sales, Procedure 4.8.1 which details how Business areas must report regularly to Corporate Services about their income generating activities.

MCS is deeply concerned about these allegations.  If substantiated, the behaviours detailed in these allegations may constitute breaches of the polices and procedures of MCS and your contract of employment. 

As part of the investigation, MCS will hold a meeting to hear your response to these allegations.  The meeting will be held in the MCS Boardroom on Friday 12 June at 11:00am.  I will conduct the meeting together with Natasha Cushway of Workplace Legal.  You may have a union or other representative attend the meeting to assist you.  You may want to provide a copy of this letter to your representative. 

If this meeting time is unsuitable for you and/or your representative, please contact Janelle Patching on tel. 5495 4566 as soon as possible to arrange another time.

Please note that, should your explanation be unsatisfactory, disciplinary action may result up to and including summary termination of employment.  In the event that you do not attend the meeting, we will proceed with this process based on the information we have to hand. 

Yours sincerely

Nancy McColl Bowen

Chief Executive Officer

Murdoch Community Services Inc

(Emphasis added).

53                                          The 5 June letter concluded by stating that MCS would hold a meeting with Ms Stevenson to hear her responses to the allegations on 12 June 2009.  Ms Stevenson went on sick leave from 5 June 2009.

54                                          The substance of the allegations in the 5 June letter was the subject of extensive cross-examination.  Counsel for Ms Stevenson questioned Ms McColl Bowen and Ms Davey about most of the allegations and challenged their legitimacy.  It is unnecessary to address Ms McColl Bowen and Ms Davey’s responses.  Ms McColl Bowen admitted during cross examination that not all of the 19 allegations were substantiated but went on to assert that “the ones that had been substantiated were very clearly substantiated and gave [her] sufficient reasons … to finish things”.  As will be discussed later in these reasons for decision, the ultimate issue for the Court is whether the reason for termination (or part of the reason for termination) of Ms Stevenson’s employment by MCS was one of the proscribed reasons in s 659 of the WR Act.  The validity of the reason for termination (even assuming that all of the 19 allegations were substantiated) is not an issue for the purposes of s 659.

55                                          From 5 June 2009 onwards, the relationship between Ms Stevenson and MCS worsened.  On 10 June 2009, Ms Natasha Cushway of Workplace Legal, on behalf of MCS, sent an email to Mr Bell of the HSU (who was acting on behalf of Ms Stevenson) which provided:

Further to our telephone conversation this afternoon, I wanted to reiterate that [MCS] does not accept that Heather cannot respond to the allegations and any further delay is unacceptable.

Therefore, the disciplinary meeting will be conducted on 17 June 2009 at [MCS].  If Heather does not attend the meeting we will expect a written response (from Heather or the HSU as her representative be it Robyn or someone else) by the close of business on 17 June 2009.

If Heather does not intend to go to the meeting on 17 June, I would appreciate someone from the HSU letting me know.  It is a long way to drive if the meeting is cancelled!

…

56                                          Mr Bell responded on 11 June 2009:

Thankyou for your email.  The HSU’s position remains the same.  Heather is unfit for her duties (as per her medical certificate) and is therefore unable to attend the disciplinary meeting scheduled for the 17^th.

We do not believe a written submission will be able to provide an opportunity for Heather to adequately respond to lengthy list of 19 allegations provided by [MCS].

In the interests of affording natural justice to Heather, I ask that the meeting be scheduled to a date as soon as practicable after she returns from sick leave.  …

57                                          On 12 June 2009, Workplace Legal sent a letter to Mr Bell which provided, inter alia the following:

…

In your e-mail you stated that Heather will not be attending the disciplinary meeting on 17 June 2009 as she has been certified unfit for her usual duties (until 20 June 2009).  The medical certificate does not prevent Ms Stevenson attending a meeting to respond to the allegations.  The medical certificate states she is unfit for her usual duties.  We are directing that Ms Stevenson respond to allegations, not perform her usual duties.

… To ensure that every fairness is provided to Ms Stevenson, we have rescheduled the meeting to Monday 22 June at 11:00 …

Alternatively, Ms Stevenson can provide a written response to the allegations or instruct you as her representative to provide a written response by close of business 22 June 2009.  In the event that Ms Stevenson does not attend the meeting or fails to provide a written response, we will make a decision based on the information that we have to hand.  Please note that if the response is unsatisfactory or if no response is received, disciplinary action up to and including summary termination of Ms Stevenson’s employment may result.

58                                          On 15 June 2009, Ms McColl Bowen became aware of Ms Stevenson and Ms Flanagan’s complaints to the HRC as a result of a telephone conversation and email communication with Ms Vanessa Crawford of the HRC.

59                                          On 19 June 2009, a further email was sent from Mr Bell to Workplace Legal which stated that Ms Stevenson had provided a further medical certificate stating she was unfit to continue her usual occupation and requested a further extension to respond to the allegations.  Ms Stevenson’s medical certificate, which was in evidence and provided to MCS’ solicitors, stated Ms Stevenson was “very distressed and not able to provide a written response to the allegations of unsatisfactory performance related to her work” for the period from 22 June 2009 to 6 July 2009.  Workplace Legal only agreed to extend the time for Ms Stevenson to file a response to 24 June 2009.  

60                                          On 23 June 2009, Mr Bell sent a further email to Ms Cushway requesting another extension to prepare a response.  The letter provided:

I’ve spoken to Heather.  She still maintains that she is not well enough to provide a comprehensive response to the allegations.  Given that [MCS] is insisting that a response is forthcoming, it appears she is left with little option but to respond.  Heather feels strong duress is being applied to her to do so.  I have never had an employer so insistent that an employee respond while on sick leave.  The approach of [MCS] appears to be exacerbating Heather’s situation.

When I spoke to Heather, she was not 100% coherent.  She spoke broadly about the allegations put to her and also brought in unrelated issues.  It is my belief that she will need considerable help to fashion her responses into some semblance of order.

The original complaint against her was sent to her on the 19^th of May, 2009.  The matter originally concerned an invoice dated 27 April, where it is alleged Ms Stevenson made a purchase contrary to the organisation’s policies.  This has now blown out to 19 allegations dating back over a year.

…

In response to this letter and a further letter from AED Legal Centre on the same day which raised similar concerns, MCS’ lawyers acknowledged the medical certificate (see [59] above) and then only provided Ms Stevenson an extension to file a response to 26 June 2009, still 10 days before the date identified in her medical certificate.

61                                          Several observations can be, and should be, made about the correspondence referred to in paragraphs [55] to [60] above.  First, MCS was aware of the existence of, and the contents of, Ms Stevenson’s medical certificate that covered her until 6 July 2009:  see [59] above.  Put simply, she was not in a fit state to respond to the allegations.  If that medical certificate had been provided to the Court, I have little doubt that proceedings would have been adjourned to enable Ms Stevenson to recover sufficiently to respond to the serious allegations raised against her.  The period sought was short.  Secondly, Mr Bell of the HSU had told MCS’ lawyers that when he spoke to Ms Stevenson she was not 100% coherent.  Thirdly, MCS wanted the matter resolved quickly notwithstanding Ms Stevenson’s illness.  Fourthly, the first three allegations raised in the 5 June letter were alleged to have occurred in May and June 2008.  Those matters were not raised at the MCS meeting on 24 June 2008 or for that matter at any other meeting.  No meeting to discuss these issues was even suggested by MCS until that identified in the 5 June letter.  Fifthly, in less than three weeks, the allegations had increased from one incident on 27 April (raised in the memorandum of 19 May 2009 (see [50] above)) to 19 separate and detailed allegations covering a period in excess of 12 months.

62                                          On 26 June 2009, Ms Stevenson provided a written “response” to the 19 allegations outlined in the 5 June letter.  In the email attaching the response Mr Bell stated:

Please find attached the response from Heather Stevenson …

…

I’ll summarise my objections as below:

1.         I still find it highly unusual for someone to be required to provide a response while on sick leave.  I have never had this as an issue before.  I find this to be quite unfair, but given the dogged insistence of [MCS] on this, we have been left with little alternative but to respond.

2.         The issues Heather has been asked to respond to, date back to May last year.  A reasonable person would have trouble recalling what happened on the 13^th May this year, let alone the 13^th of May last year.  It is unreasonable to ask a person to respond to such old allegations.

3.         Many of these issues should have been dealt with in house as part of the day to day management.  [MCS] needs to take some responsibility for these failures.

4.         The allegations started out as a single allegation dated the 19^th of May.  This has since ballooned out to 19 allegations which smells like a fishing expedition.

5.         One of the allegations relates to an incorrectly filled out leave form.  This is at best finicky nitpicking.

I trust that [MCS] will apply the principles of natural justice to Heather’s responses.

The emphasis was in the original.  Each of the objections identified by Mr Bell had substance.  These objections were never addressed by MCS. 

63                                          Ms Stevenson’s response was lengthy.  It is not necessary to set out its entire contents.  However, the following observations can be made about the form and contents of the “response”.  The document attempts to respond to the allegations in the 5 June letter.  The response was, in many aspects, unintelligible and emotionally charged.  The document was difficult to follow both in its content and form.  The numbering did not match that of the 5 June letter and even if particular paragraphs were matched with specific allegations in the 5 June letter, extraneous matters were raised throughout the responses.  It was apparent that Ms Stevenson had not had access to documentary records to assist her in preparing the response.  The form and content of her response stood in stark contrast with her earlier correspondence to MCS in February 2009:  see [40] above.  

64                                          The following extract from Ms Stevenson’s “response” to just some of the allegations raised in the 5 June letter provides direct and contemporaneous evidence of the matters just described and of the problems and difficulties identified by Mr Bell in his covering email (see [62] above):

As requested by 3 oclock (sic) on Friday the 26^th June

‘I am making this statement under duress and against the advice of my doctor.  My doctor does not believe that I am competent to respond fully to these allegations.’

I wish to put my interpretation to the service delivery that a supported employment setting needs to meet the commonwealth standards and the disability acts 2006.  That we are supposed to be providing work experiences as equal to the norm as possible. 

The policy and procedure documents comprising of two volumes has now created virtual maize (sic) to work through.  Access to policies and procedure manuals is limited as time is restricted due to 30 hours of hands on support time in my program area and all administration tasks that have been requested to be completed for the administration area.  The policy and procedures manuals are written in a format which is difficult to navigate and the language is hard to understand.

Application of this document is creating a conflict between what the correct practice is under the current Acts, Standards and guidelines versus policy and procedure.

…

15.

July, August, September 2008

I was given a memo dated the 8^th October about money management on 7^th October 2008 at 3.30 and it was already written out with what I had said when in fact I had not even had the chance to explain anything and she stated she was not interested ... .

Nancy states that $270.00 had not been collected when I was informed by Nancy about this I was not told who had not paid or given the chance to go and check the duplicate copies that were at the Laundromat to see what had occurred.  As the day sheets were written on a duplicate copy and removed from the book at the end of each week and taken to the centre.  Customers that had not collected there (sic) laundry in that week came back the following week and we would have to mark paid on the duplicate copy and initial.  No cross reference has been made on any of the duplicate[s] as I have no idea of who these people are as Nancy never told me.  This was the practice that I had to do up to the 24^th December 2008. 

Supported employees have always been allowed in the 16 years that MCS has had the Laundromat to serve the customers and take money and give change when the support staff is present.  I am discussed (sic) to think that I am not allow[ed] to have a 10 minute break in the morning or afternoon break.  i (sic) am there on my own and that speaks for itself.  If management were reasonable they would send a staff member down to cover my breaks and allow me to have my break time.  Example of unsupported supported employees is if I go to the toilet any time in the day I would be un supporting (sic) supported employees.  This is currently the practice as I am a worker on my own with supported employees.

Another example is there are four rooms (Public Area, Toilet, Kitchen, workroom) and I could be out in the public area with two supported employees assisting them with the washing and this means the other 4 supported employees are in the work room ironing unsupported until I finish assisting the others.

Follow up on cash customers

I have always followed up with customers concerns, if there were any issues about a customer that owed money.  I would get the office staff to send customers out an account.  Practice that was always done in the past.

16

I went on leave on the 24^th December

I asked from about the beginning of October right through to when I went on leave what arrangement[s] were in placed for my leave and I was told in no uncertain words that it was not my problem by Sharon Davey.  On several occasion[s] I asked Sharon Davey if she wanted me to do anything to assist the staff before I went on leave and I was told no.  Attached is a copy of [the] letter sent to Sharon Shepherd the permanent staff person that had previously covered my leave in January 2008 that verifies that I had nothing to do with staffing for this year (sic) leave arrangements.  …

Before my computer was removed I had internet and had access to emails, and templates from the policy manuals.

Since January 2007 I have not had a computer of any kind at the Laundromat.  Nancy rang up one day and said Fiona was coming to get my computer no explanation or reason for this.

My computer had all templates for the policy and procedure on it and now I have to get the office staff to photocopy any document and this could take days to complete.  I have asked if I could assess (sic) to other computers to type up Employment Plans of clients but no.  This recently was request[ed] at an EAP Meeting by me to Sharon Davey and I was told no.  The clients and her advocates were there when I requested this simple thing.  But No was given by Sharon Davey. 

As far as the folder with scrap paper and no one could understand it.

Sharon Shepherd ran the Laundromat from boxing day to new years day and found the information sufficient to follow all customers were listed in my messy folder as you put it.

She will verify this in writing if required if I had a computer.  I could of type[d] this information out.

…

19

11.2.2009        I WAS ON LEAVE

My honesty and integrity has never in 21 years ever been questioned before.  But I will say there has been many times over the years I have had to change money out of my purse with the change in the till to allow me to give customers back change when the customer is in a hurry.  Customers would be able to verify this as I have done this practice in front of them as it quicken[s] up the time for the customer.  Brenda Burke can verify this practice as she does it to.  Attachment 8. 

20

As far as I bringing this up at the coordinators meeting about Laundromat was extremely quiet all week and the supported employees could only clean so much I had to find activities for them to do so as to minimize behavior (sic) as there was little work.  I may breach policies but what else could I do. 

May the 1^st Dana Decker support work casual entered the Laundromat and found one client asleep and one doing a jigsaw puzzle.  In response to client sleeping I would like to say that I was at a Employment plan meeting with this supported employee the day before and I raised this issue as it had concerned me for a long time that this supported employee was dropping to sleep as soon as she sat.  It was brought to Sharon Davey[’s] attention by THE SUPPORTED EMPLOYEES ADVOCATE HAD ANYTHING BEEN DONE TO FIND OUT WHY SHE DID NOT KNOW and I said nothing and supported employee said the same.  It was put into the supported employees eap that she attend her local GP and find out if there was any medical reason for this to be occurring.  This person receives an outreach service and I have raised this concern with the coordinator several times but she must of thought it not to be important. 

The other supported employee that was doing a jigsaw had hurt her hand and could not iron or do any work this week so she was sent to work from respite House as there is no staff on during the day to supervise her.  Fiona Sillis asked me if this would be all right and I agree[ed] that she could come down and try to do task[s] but the supported employee found it very difficult. 

(Emphasis in the original).

65                                          Three days later, on 29 June 2009, MCS terminated Ms Stevenson’s employment.  The letter terminating her employment stated:

Dear Heather

Unsatisfactory performance and conduct - termination of employment

We write further to the memorandum of 19 May 2009, letters dated 5 June 2009 and 10 June 2009, a letter dated 12 June which was sent to your chosen representative, the Health Services Union (“the HSU”), and your response to the allegations along with attachments dated 26 June 2009.

We have been seeking a response to allegations that relate to unsatisfactory performance and conduct by you, specifically failure to follow policies and procedures of [MCS] and failure to manage the [L]aundromat business unit efficiently.

Disciplinary Process

After we put allegations to you in a letter dated 5 June 2009, you submitted a medical certificate stating that you were unfit to perform your usual duties.  After receiving your medical certificate, we wrote to you on 10 June 2009, providing you with the following options to enable to you to respond to the allegations:

1.       Attend a meeting scheduled for 11:00 on 17 June 2009;

2.       Provide a written response to the allegations by close of business on 17 June 2009; or

3.       Instruct your representative, the HSU to respond to the allegations by the close of business 17 June 2009/

At the request of the HSU, the meeting and / or deadline for a response to the allegations was moved to a date after you were to return from personal leave.  In our letter to the HSU dated 12 June 2009, we offered the following options to enable you to respond to the allegations:

1.       Attend the meeting scheduled for 11:00 on 22 June 2009;

2.       Provide a written response to the allegations by 22 June 2009;

3.       Instruct the HSU as your representative to respond to the allegations by 22 June 2009;

You submitted another medical certificate on 22 June, certifying you as unfit to perform your usual duties and unfit to provide a written response to the allegations.

We extended the deadline for a response to 24 June 2009.  On 23 June 2009, the HSU advised us that you were willing to provide a written response to the allegations but requested that the deadline be extended by 5 days.  We have at all times been mindful that you are entitled to an opportunity to respond and agreed to extend the deadline to 26 June 2009 at 15:00.

We note that you have chosen to provide a written response to the allegations personally, rather than instruct the HSU as your representative.

Decision

We have now concluded our investigations.  We have considered your response to the allegations and the attachments that were provided to [MCS] by you, along with the material obtained by [MCS].

You admit that you have failed to follow the policies and procedures of [MCS] on numerous occasions, despite receiving lawful and reasonable directions from [MCS] to follow such policies and procedures.  You have displayed no insight into your behaviour and conduct and as a result we have lost the necessary trust and confidence in you and your ability to perform your job.  We have concluded that your conduct constitutes serious and wilful misconduct.  As a result we have decided to terminate your employment summarily, effective today.  However, in all the circumstances, we have decided to make a payment to you equivalent to five weeks salary in lieu of notice.

…

66                                          As can be seen, events had moved quickly in June 2009. 

67                                          I am not satisfied that any response Ms Stevenson gave would have made any difference to MCS’ proposed course of conduct, that is to terminate Ms Stevenson’s employment.  I find that MCS was prepared to terminate Ms Stevenson’s employment regardless of the form and content of the response, if any, from Ms Stevenson.  This finding was supported by the direct evidence of Ms McColl Bowen when she admitted that one of the reasons for the urgency in terminating Ms Stevenson’s employment in June was because of the changes from the WR Act to the Fair Work Act 2009 (Cth) (the Fair Work Act), which was due to commence from 1 July 2009.  In her evidence she stated:

I knew the change was going to happen on 30 June, and realistically I knew Heather would not be happy with whatever I did.  And by working through the process, giving her every opportunity to respond, but to move it along and, you know, not just to say, “Well, once more, we’ll let things lie as it happened.”  Really, we needed to move on this for the sake of the organisation.

(Emphasis added).

68                                          Contrary to Ms McColl Bowen’s assertions, I do not accept that MCS gave Ms Stevenson “every opportunity to respond”.  MCS’ letter of 29 June 2009 was inaccurate.  MCS had not “provided” an opportunity for Ms Stevenson to respond.  MCS had demanded a response and it did so despite the medical and other evidence as to Ms Stevenson’s inability to respond to the serious allegations raised in the 5 June letter.  If Ms Stevenson did not respond, her employment would be likely to be terminated:  see the 5 June letter.  If she did respond (despite the medical and other evidence which established that she was not fit to respond), her employment would be likely to be, and was, terminated.  With full knowledge of Ms Stevenson’s medical certificate which certified she was unable to respond to the allegations before 6 July 2009 (see [59] above) MCS continued to press for an immediate response.  I accept the evidence of Mr Bell that the pressure applied by MCS while Ms Stevenson was on sick leave “exacerbated the situation” (see [60] above) and made a coherent (and acceptable) response from Ms Stevenson less likely.  In my view, if Ms Stevenson’s termination (as suggested in the 5 June letter) was dependant on or at least likely to be affected by her response to the allegations put against her, MCS should have waited until Ms Stevenson was in a position to respond.  MCS’ failure to wait until Ms Stevenson’s temporary absence from work due to illness had passed, as well as the steps MCS took to speed up the process of termination of her employment in those circumstances, are separately and collectively evidence of the fact that MCS took advantage of and used Ms Stevenson’s temporary absence from work due to illness (in addition to the legislative provisions) in terminating her employment.  As will be seen later in these reasons for decision, this has significant consequences for MCS.

69                                          On 30 June 2009, Ms Stevenson applied to the Australian Industrial Relations Commission (AIRC) for relief in relation to termination of her employment.

Ms Stevenson’s Thyroid Condition

70                                          One factual matter that falls outside of the chronology just identified requires separate consideration.  Ms Stevenson claimed that since 1999 she has had a chronic thyroid condition and that she has always informed the people she worked with that she had such a condition.  As proof of her thyroid condition, Ms Stevenson submitted a medical certificate of Dr Vesna Slipcevic dated 9 February 2010 which provided:

Re: Ms Heather Ann Stevenson …

Brief outline of Medical History

Mr Heather (sic) presented 27 February 2009 acutely distressed because of abusive letters that she was receiving from her manager at work while on long service leave.  Upset, worried, problems sleeping, concentrating, coping with everyday life stressors/ issues.

I’ve seen her again, 12 March when we did her routine thyroid functions test review (she has chronic hypothyroidism and takes regular thyroid hormone supplement) and needed adjustment of medication, ongoing stress related to work might have been contributing to thyroid upset.

9 June 2009.

Another consultation for same, ongoing problem, this time she was, in her opinion, unfairly treated and given letter to the effect that the medical certificate does not provide … basis upon which Mrs. Stevenson need not reply to the allegations.

24.06.2009. another consultation for ongoing problem, worried, stressed, not coping well and was referred for support and counselling to psychologist.

10.08.09

Review, started to improve and coping better, waiting for court case.

71                                          For the present purposes, it is sufficient to note that while this medical certificate confirms that Ms Stevenson has a thyroid condition, it does not establish that MCS knew of this condition since 1999 or at all.  Ms Stevenson submitted that this thyroid condition is a disability within the meaning of the DDA. 

72                                          Ms Stevenson further submitted that MCS’ knowledge of Ms Stevenson’s thyroid condition could be inferred from two facts.  First, on 8 April 2008, when Ms Stevenson’s Staff and Volunteer Code of Conduct (Code of Conduct)was amended.  The Code of Conduct was amended on 8 April 2008 when an email was sent from Michael Claven of the Australian Education Union to Ms McColl Bowen.  The email provided:

Dear Nancy

Please find amended words to be inserted in Heather Stevenson’s and Sharon Brooks’ “Staff and Volunteer Code of Conduct” documents with [MCS].

Please substitute wording in the section re Alcohol & Drugs

Delete:

-           Be under the influence of alcohol or an illegal substance, or partake at work, alcohol or an illegal substance.

Substitute with

“Being intoxicated at work.  The employee will be taken to be intoxicated at work if their faculties are so impaired because they have consumed alcohol or another drug (except if the drug is taken in accordance with the directions of a person lawfully authorised to administer or prescribe the drug) that the employee is unfit to perform their duties in accordance with their position description or any other duty which the employer may lawfully and reasonably request of the employee. (An exception to the consumption of alcohol, on [MCS] premises would be, at an approved organisational function).”

We hope this clarifies the matter.  Should this wording be substituted as indicated, our members would have no hesitation in signing the document. 

(Emphasis in the original).

73                                          Ms Stevenson submitted that the Code of Conduct was changed to “take account of the fact that [Ms Stevenson] was on medication”.  However, Ms McColl Bowen’s recollection of the proposed amendment was that:

[Ms Stevenson] came to see me about a particular clause in the [C]ode of [C]onduct and she said “What about if I smoke a joint on Sunday evening and you blood test me on Monday morning?”

She further stated that the amendments had nothing to do with Ms Stevenson’s thyroid condition and that she “didn’t know she had a thyroid condition”.  Ms Davey stated that she had never seen the email of 8 April 2008.

74                                          I do not accept that MCS and Ms McColl Bowen’s knowledge of Ms Stevenson’s thyroid condition is to be inferred from the 8 April 2008 email.  The evidence given by all parties on this particular issue was unsatisfactory.  The oral evidence given by all parties was coloured by the tensions that exist between Ms Stevenson and Ms McColl Bowen.

75                                          The second fact relied upon by Ms Stevenson from which MCS’ knowledge of Ms Stevenson’s thyroid condition could be inferred was the meeting of 24 June 2008 (see [25] to [29] above) and, in particular, the reference in the file note to “medication”.  This evidence does not provide a sufficient basis to infer that MCS knew of Ms Stevenson’s thyroid condition.  I have found (see [30] above) that the file note was an accurate record of the meeting.  There is no mention in that record of Ms Stevenson’s thyroid condition, and the reference to the word “medication” is not, in my view, sufficient to establish otherwise.  Moreover, as noted above (see [33]), on 16 July 2008, MCS referred to Ms Stevenson as an employee “without a disability”.  

III.       OPERATION OF SECTION 674 OF THE WR ACT

76                                          Before addressing the substantive submissions under the DDA and the WR Act, it is necessary to address the Respondents’ submission that because Ms Stevenson alleged unlawful termination of employment under both the DDA and the WR Act, she was barred from making both claims by reason of s 674 of the WR Act. 

77                                          Section 674 provides:

(1)        An application alleging unlawful termination of employment must not be made by an employee if other termination proceedings have already been commenced in respect of the termination of employment, unless the other termination proceedings:

            (a)        have been discontinued by the employee; or

            (b)        have failed for want of jurisdiction.

…

(4)        Without limiting subsection (3), other termination proceedings includes an enquiry in respect of a complaint (the HREOC complaint):

(a)        made under the Human Rights and Equal Opportunity Commission Act 1986; and

(b)        that relates to the termination of employment of an employee (whether or not as a result of an amendment of the complaint)

(5)        For the purposes of this section, an employee commences other termination proceedings of a kind referred to in subsection (4):

            (a)        … when the employee makes the HREOC complaint; …

78                                          The Respondents submitted that Ms Stevenson’s complaint to the HRC on or about 2 June 2009 was “other termination proceedings” and that because the DDA complaint arose first (the AIRC claim commenced on 30 June 2009), Ms Stevenson had to elect between her DDA claim and her WR Act claim. 

79                                          Counsel for Ms Stevenson rejected that submission.  Ms Stevenson submitted that the DDA claim was not intended to deal with the termination but rather “everything leading up to it”.  I accept that submission.  The HRC complaint was made before Ms Stevenson’s employment was terminated and does not concern her termination.  Accordingly, the DDA claim cannot be characterised as “termination proceedings”.  In my view, Ms Stevenson is entitled to seek relief under both applications. 

IV.       CLAIM UNDER THE DISABILITY DISCRIMINATION ACT

Leave to amend originating process

80                                          As noted earlier (see [7] to [9] above), the basis of Ms Stevenson’s claim under the DDA changed during the course of the proceedings.  In her originating application, the only alleged contraventions by the Respondents were of ss 5, 6 and 15 of the DDA.  During final submissions, Ms Stevenson sought leave to amend the basis of her claim to assert that the Respondents had also breached s 42 of the DDA through committing an act of victimisation. 

81                                          Leave to amend, at any stage, is governed by O 13 r 2 of the Federal Court Rules and, notwithstanding the difference in language in the applicable Rules of Court, the decision of the High Court in AON Risk Services Australia Limited v Australian National University (2009) 239 CLR 175.  As Edmonds J said in SPI Spirits (Cyprus) Ltd v Diageo Australia Ltd (No 4) [2007] FCA 1035 at [14], considerations of ensuring decisions are made on the real matter of controversy, without prejudice to the other party, are relevant.  However, those considerations must themselves be balanced against other considerations of case management, delay and wasted costs: AON 239 CLR 175at [111]. 

82                                          The alleged contraventions of s 42 were included in Ms Stevenson’s HRC complaint.  No explanation was proffered by Ms Stevenson’s Counsel as to why the claim under s 42 was not included in her originating application.  Presumably, it was an oversight.  Ms Stevenson’s Counsel submitted that her case had been run on the basis that s 42 was contravened.  The Respondents’ Counsel acknowledged that it was aware that s 42 was included in the HRC complaint, that they had prepared their case on that basis and could not identify any prejudice if leave to make the amendment was granted.  Significantly, no costs or delays were identified if leave was granted.  In the circumstances and in light of the principles discussed at [81] above, I would grant Ms Stevenson leave to amend her application to include an alleged contravention of s 42 of the DDA.

Legal principles and analysis

83                                          Section 4(1) of the DDA in force at the time of the relevant events defined “disability” as follows:

disability, in relation to a person, means:

(a)        total or partial loss of the person’s bodily or mental functions; or

(b)        total or partial loss of a part of the body; or

(c)        the presence in the body of organisms causing disease or illness; or

(d)        the presence in the body of organisms capable of causing disease or illness; or

(e)        the malfunction, malformation or disfigurement of a part of the person’s body; or

(f)        a disorder or malfunction that results in the person learning differently from a person without the disorder or malfunction; or

(g)        a disorder, illness or disease that affects a person’s thought processes, perception of reality, emotions or judgment or that results in disturbed behaviour;

and includes a disability that:

(h)        presently exists; or

(i)         previously existed but no longer exists; or

(j)         may exist in the future; or

(k)        is imputed to a person.

84                                          Section 5 as it was at the time of the events is also relevant.  It provided:

(1)        For the purposes of this Act, a person (discriminator) discriminates against another person (aggrieved person) on the ground of a disability of the aggrieved person if, because of the aggrieved person’s disability, the discriminator treats or proposes to treat the aggrieved person less favourably than, in circumstances that are the same or are not materially different, the discriminator treats or would treat a person without the disability.

(2)        For the purposes of subsection (1), circumstances in which a person treats or would treat another person with a disability are not materially different because of the fact that different accommodation or services may be required by the person with a disability.

85                                          The words “because of” in s 5(1) require a causal connection between the disability and the “less favourable treatment”.  In Purvis v New South Wales (Department of Education and Training) (2003) 217 CLR 92 at [236] Gummow, Hayne and Heydon JJ posed the question to be asked in the following terms:

[T]he central question will always be - why was the aggrieved person treated as he or she was?  If the aggrieved person was treated less favourably was it ‘because of’, ‘by reason of’, that person’s disability?

86                                          In determining whether a person has been treated “less favourably” in circumstances that are the same or not materially different, the proper comparator is a person with the same behavioural characteristics without the disability: see Purvis 217 CLR 92 at [11] and Zhang 174 FCR 366 at [64] per Jessup and Gordon JJ. 

Ms Stevenson’s Thyroid Condition

87                                          In DDA proceedings, the alleged disability must be identified with precision: see Qantas Airways Ltd v Gama (2008) 167 FCR 537 at [91].  As noted earlier, Ms Stevenson asserted that her disability was her thyroid condition.  Ms Stevenson did not make any submissions establishing, on the balance of probabilities, that her thyroid condition was in fact a disability within the meaning of s 4 of the DDA.  Indeed, the submissions of Ms Stevenson appear to assume it is a disability. No evidence was adduced concerning how the condition manifested itself or how the condition affected Ms Stevenson from May 2008 to June 2009.  The only evidence concerning her condition was in the medical certificate of Dr Slipcevic (see [70] above) which stated that she had chronic hypothyroidism and that she needed an adjustment of medication to accommodate her “thyroid upset” due to stress. 

88                                          That evidence was not sufficient.  I am not satisfied that Ms Stevenson demonstrated that her thyroid condition can be described as a disability in circumstances where limited evidence was adduced as to its existence and no evidence was adduced as to its seriousness or its impact. 

89                                          Moreover, even if one assumes for the present purposes that Ms Stevenson’s thyroid condition was a disability, I do not accept that the Respondents were aware of this disability (see [70] to [75] above) or, even if they were, that they treated Ms Stevenson less favourably because of her disability.  Ms Stevenson did not identify how the thyroid condition had any relevance to the conduct of MCS and Ms McColl Bowen between May 2008 and June 2009.  Ms Stevenson’s claim on this basis is dismissed.

Disability based on the association with Ms Flanagan

90                                          Ms Stevenson also alleged a disability on the basis of her association with Ms Flanagan.  However, in her submissions, Ms Stevenson erroneously relied on later amendments to the DDA which are not applicable to the facts of this case.  In 2009, the Disability Discrimination and Other Human Rights Legislation Amendment Act 2009 (Cth) (the Amending Act) substantially amended the DDA and inserted a new s 7 which provided:

This Act applies in relation to a person who has an associate with a disability in the same way as it applies in relation to a person with the disability.

91                                          These amendments came into force on 5 August 2009.  Ms Stevenson’s Counsel relied on this provision notwithstanding that it did not come into force until after the relevant events (that is, between 5 May 2008 – 29 June 2009).  As the applicable Act is that which is in force at the time of the relevant events (Zhang 174 FCR 366), the reliance on the amended s 7 is misplaced.

92                                          That is not to say that Ms Stevenson’s relationship with Ms Flanagan is irrelevant under the DDA in force at the time of the relevant events.  Section 15(2) was also relied on by Ms Stevenson.  It provided:

(2)        It is unlawful for an employer or a person acting or purporting to act on behalf of an employer to discriminate against an employee on the ground of the employee’s disability or a disability of any of that employee’s associates:

(a)        in the terms or conditions of employment that the employer affords the employee; or

(b)        by denying the employee access, or limiting the employee’s access, to opportunities for promotion, transfer or training, or to any other benefits associated with employment; or

(c)        by dismissing the employee; or

(d)        by subjecting the employee to any other detriment.

93                                          Ms Stevenson, as Ms Flanagan’s carer, is an “associate” for the purposes of the DDA: see s 4 of the DDA.  However, Ms Stevenson did not identify what element of s 15(2) of the DDA was breached.  Presumably reliance is placed on s 15(2)(d) – subjecting the employee to any other detriment.  I draw this inference based on the following evidence from Ms Stevenson:

Lorraine with 5 May, I get put into a meeting on the 6th, became a part of that issue that you were just discussing.  When Lorraine had the work cover, I got a file note.  When she was meeting to talk about this with Sharon, I got a file note.  On 8 December, Nancy had a meeting with Lorraine to try and resolve this situation.  I got a file not.  And it goes on and on.  For every time something happened with Lorraine there was a file note written against me.  And I was not told about it until on 5 June when I received those 19 points of allegation that 95 per cent of them all match up with something that happened with Lorraine the day before or the day after.

94                                          In light of the findings made above concerning the behaviour of MCS and Ms McColl Bowen (see [17] to [69]) to Ms Stevenson, I reject that Ms Stevenson was subjected to a detriment because of her relationship with Ms Flanagan.  Ms Stevenson has not established any link between her relationship with Ms Flanagan and her treatment by MCS and Ms McColl Bowen.  Ms Stevenson’s claim on this basis is dismissed.

Victimisation

95                                          Ms Stevenson’s final submission concerning s 42 of the DDA can be addressed briefly.  Ms Stevenson submitted that the actions of MCS and Ms McColl Bowen from 5 June 2009 (the date on which the 19 allegations of non-performance were made) to 29 June 2009 (the date of termination) were an act of victimisation as a result of her complaint, or alternatively Ms Flanagan’s complaint, to the HRC.  The evidence disclosed that neither MCS nor Ms McColl Bowen became aware that Ms Stevenson and Ms Flanagan had filed their complaints with the HRC until 15 June 2009, 10 days after the 5 June letter.  Further, Ms Stevenson has not demonstrated that once MCS and Ms McColl Bowen became aware of the HRC complaints (between 15 June and 29 June 2009), their behaviour described in paragraphs [55] to [65] above was in any way linked to or as a result of the HRC complaints.  Ms Stevenson’s claim on this basis is also dismissed.

V.        CLAIM UNDER THE WORKPLACE RELATIONS ACT

Leave to amend originating application

96                                          As noted earlier (see [4] to [6] above), the basis of Ms Stevenson’s claim under the WR Act substantially changed during the course of the proceedings.  In her originating application, the only alleged contravention by MCS was of s 659(2)(f) of the WR Act, being unlawful termination on the basis of physical disability and / or family responsibilities.  During final submissions, Ms Stevenson sought leave to amend the basis of her claim to assert that in contravention of ss 659(2)(a) and (e) of the WR Act, her employment was terminated for proscribed reasons, namely “temporary absence from work because of illness or injury” (s 659(2)(a)) and the filing of a complaint against an employer involving alleged violation of laws (s 659(2)(e)).  Ms Stevenson also sought reinstatement under s 665 of the WR Act.  MCS (the only Respondent in proceedings VID 661 of 2009) opposed the grant of leave. 

97                                          The alleged contraventions under ss 659(2)(a) and (e), and the relief sought under s 665, were included in the complaint to the AIRC.  No explanation was proffered by Ms Stevenson’s Counsel as to why the proposed amendments were not included in her originating application.  Again, presumably it was an oversight.  However, Ms Stevenson submitted that her entire case had been run on the basis that ss 659(2)(a) and (e) were contravened and relief was sought under s 665 of the WR Act. 

98                                          Counsel for MCS acknowledged that they were aware the AIRC complaint included these alleged contraventions and claims for relief and further that correspondence had been received from Ms Stevenson as early as 10 August 2009 that identified the grounds now sought to be included.  MCS originally submitted it was prejudiced because it “broaden[ed] the scope of inquiry that was filed before the Court” and that “little, if any, cross-examination of witnesses [was undertaken] for [MCS] as to the relevant considerations”.  However, after acknowledging MCS had run the case with the knowledge that these matters were relied upon by Ms Stevenson, Counsel for MCS could not identify any prejudice that would result in leave being granted.  In the circumstances, I would grant Ms Stevenson leave to amend her application to include an allegation that in contravention of ss 659(2)(a) and (e) of the WR Act, her employment was terminated for proscribed reasons.  I would also grant her leave to seek relief of reinstatement under s 665 of the WR Act. 

Legal Principles

99                                          Section 659 of the WR Act is a “reverse onus” provision:  see ss 664 and 809 of the WR Act. 

100                                       As a result:

1.                  where there is an allegation of termination of employment by an employer for a proscribed reason, it is sufficient for it to be presumed that the conduct was engaged in for that reason unless the employer proves to the contrary:  see, by way of example, Rojas v Esselte Australia Pty Ltd (No 2) (2008) 177 IR 306 at [46] – [51]; Greater Dandenong City Council v Australian Municipal, Clerical and Services Union (2001) 112 FCR 232 at [7]; Davids Distribution Pty Ltd v National Union of Workers (1999) 91 FCR 463 at [109] (dealing with the predecessor to s 298V of the WR Act); Maritime Union of Australia v Geraldton Port Authority (1999) 93 FCR 34 at 68.  That presumption is rebuttable:  Geraldton Port Authority 93 FCR 34 at 68;

2.                  however, notwithstanding that presumption, an applicant must prove the existence of objective facts which the applicant contends provide a basis for the respondent’s contravening conduct:  see Construction, Forestry, Mining and Energy Union  v Coal and Allied Operations Pty Ltd (1999) 140 IR 131 at [161] – [162].  The presumption “simply … alleviate[s] the evidentiary difficulty facing the applicant of providing proof of the intent or reason which motivated, or formed part of the motivation for, the respondent’s conduct following the absence of the employee from work” (emphasis added); 

3.                  if an applicant proves those facts and alleges that the conduct was carried out for a prohibited reason, then the onus shifts to the respondent to prove, on the balance of probabilities, that it was not motivated by a proscribed reason:  Geraldton Port Authority 93 FCR 34 at 68.  Why?  Because, as Nicholson J stated, “[t]he reversal of the onus in respect of proof of the reasons for the conduct is a recognition that ‘the circumstances by reason of which an employer may take action against an employee are, of necessity, peculiarly with the knowledge of the employer’”; and

4.                  where the onus has shifted, an employer will usually need to adduce evidence of the real reason for the dismissal, consistent with the absence of a prohibited reason, to rebut the presumption: Rojas 177 IR 306 at [46] – [51] and Seymour v Saint-Gobain Abrasives Pty Ltd (2006) 161 IR 9at [29].

101                                       Consistent with those principles, Ms Stevenson was required to prove the existence of objective facts which provided a basis for contending that MCS terminated her employment for proscribed reasons, namely physical or mental disability or family responsibilities, temporary absence from work because of illness or injury and further or alternatively, the filing of a complaint or participation in proceedings against an employer involving alleged violation of laws. 

Analysis

102                                       Having regard to all of the evidence (see [17] to [69] above), I consider that Ms Stevenson has established “preliminary facts necessary to enliven the need for [MCS] to embark upon attempting to rebut the presumption”.  However, the preliminary facts were directed at only one of the alleged proscribed reasons – temporary absence from work because of illness or injury.  There was insufficient facts to establish the claim under s 659(2)(e) – the filing of a complaint against an employer involving alleged violation of laws.  The allegations of misconduct which led to Ms Stevenson’s dismissal (in the 5 June letter) were raised 10 days before MCS became aware of the complaint to the HRC.  There was no evidence to suggest any relationship between the timing of the complaint to the HRC and the timing of the 5 June 2009 letter.  It is true that the 29 June termination letter came after MCS became aware of the complaint to the HRC, but all of the evidence suggests that MCS’ decision to terminate Ms Stevenson’s employment was first contemplated before the HRC complaint was known to MCS and was determined, rightly or wrongly, for reasons distinct from the HRC complaint:  see [67] and [68]. 

103                                       Additionally, the evidence did not disclose that Ms Stevenson had “family responsibilities” at the time she was terminated.  It is true that Ms Stevenson was Ms Flanagan’s carer, and that Ms Flanagan was involved in her own dispute with MCS.  However, Ms Stevenson did not adduce any evidence to identify that, at the time of her termination, she had any responsibilities to her sister that impacted her employment.  This can be contrasted, for example, with Laz v Downer Group (2000) 108 IR 244, where the applicant successfully established that she needed to leave early to collect her child from childcare, and the respondent failed to show that this did not contribute to their decision to terminate her employment.  Additionally, for the reasons identified above (see [87] to [94]), there was no or insufficient evidence to establish that Ms Stevenson had a physical or mental disability. 

104                                       That leaves the allegation that Ms Stevenson’s employment was terminated for a proscribed reason – temporary absence from work because of illness or injury in contravention of s 659(2)(a) of the WR Act.

105                                       The evidence disclosed that at the time Ms Stevenson’s employment with MCS was terminated she was temporarily absent from work because of illness:  see [55] to [68] above.  It was accepted that Ms Stevenson’s absence was a “temporary absence” appropriately identified with a medical certificate (see [59] above) consistent with reg 12.8(1) of the Workplace Relations Regulations 2006 (Cth).

106                                       That being so, the onus shifted to MCS to prove, on the balance of probabilities, that MCS was not motivated by that proscribed reason and that the proscribed reason (temporary absence from work because of illness or injury) did not contribute to their decision to terminate her employment.  As I have said earlier, an employer would usually need to adduce evidence of the real reason for the dismissal, consistent with the absence of a prohibited reason, to rebut the presumption.  In the present case, I do not consider that MCS has discharged its onus. 

107                                       First, MCS (and for that matter Ms McColl Bowen) acknowledged and accepted that the process adopted by MCS in terminating Ms Stevenson’s employment “may not have been fair or morally acceptable from [Ms Stevenson’s] or even the Court’s perspective”.  However, notwithstanding that admission, the Respondents submitted that the termination of Ms Stevenson’s employment was not because she was temporarily absent from work because of illness:  see [67] and [68] above. 

108                                       As I found earlier, Ms McColl Bowen wished to terminate Ms Stevenson’s employment and, on her own admission, to do so before the repeal of the WR Act and the introduction of the Fair Work Act: see [67] above.  Her evidence was that she terminated Ms Stevenson’s employment because of the admissions Ms Stevenson had made in her response of 26 June 2009, and in particular, her failure to follow the policies and procedures of MCS: see [66] to [68] above.  I reject that as a complete and accurate description of the reasons why Ms Stevenson’s employment was terminated. 

109                                       Given the form and content of Ms Stevenson’s response, the circumstances in which she responded and that Ms Stevenson and her HSU representative had both expressly stated that Ms Stevenson was not well enough to respond to the allegations, the timing and content of MCS’ 29 June termination letter was surprising.  MCS decided within three days of receiving a response from Ms Stevenson that her employment should be terminated.  The 29 June termination letter was self serving, vague and inaccurate: see [66] to [68] above.  Ms McColl Bowen admitted that not all of the allegations in the 5 June letter were substantiated.  This was not disclosed in the 29 June termination letter.  In fact, the 29 June termination letter did not identify any specific fact or matter (other than reference to previous letters) as a basis for termination of Ms Stevenson’s employment.  Its content stands in stark contrast to the detail of the 5 June letter:  see [52] above.  No evidence was adduced of any investigations or enquiries having been made by MCS of Ms Stevenson or others concerning any of the matters raised by Ms Stevenson or any of the matters raised by Mr Bell. 

110                                       In these circumstances, MCS has not provided “an explanation of the real reason” for terminating Ms Stevenson’s employment consistent with the absence of a proscribed reason – namely temporary absence from work because of illness or injury:  see Seymour161 IR 9 at [29].  I do not consider that MCS discharged its onus.  MCS took advantage of Ms Stevenson’s temporary absence from work because of illness and terminated her employment.  MCS terminated her employment in circumstances where she was unable to properly respond to the allegations raised against her by reason of the proscribed reason - her temporary absence from work because of illness:  see [63] to [68] and [109].  I am satisfied that MCS terminated Ms Stevenson’s employment at least for a reason that included a proscribed reason, namely her temporary absence from work because of illness.  MCS has not established on the balance of probabilities that it was not motivated by that proscribed reason and that the proscribed reason did not contribute to its decision to terminate Ms Stevenson’s employment.  MCS admitted that the process it adopted was unfair and morally reprehensible.  However, it was also unlawful - it contravened s 659(2)(a) of the WR Act.

VI.       RELIEF

111                                       The relief Ms Stevenson sought under the WR Act above all others was reinstatement under s 665(1)(b).  In the circumstances, I do not consider that I should order reinstatement of Ms Stevenson.  MCS is a relatively small organisation.  Despite the changes in management which recently occurred (including the resignation of Ms McColl Bowen, Ms Davey and Ms Medlyn), no evidence was adduced about the practicality of reinstatement of Ms Stevenson.  On the contrary, the tension between MCS and Ms Stevenson which was evident throughout the conduct of these proceedings demonstrates the impracticality of such a remedy: see Laz 108 IR 244.  I accept that this places Ms Stevenson in a difficult position.  But that difficulty does not warrant making the order for reinstatement which she seeks. 

112                                       Instead, I consider that MCS should pay Ms Stevenson compensation in the form of the remuneration Ms Stevenson would have received for a period of six months under s 665(1)(c):  see also ss 665(2), (3) and (5).  That amount of compensation is to be reduced by the amount that MCS provided to Ms Stevenson at termination: see s 665(3)(a).  In fixing that amount, I take into account the very long service which Ms Stevenson has had with, and given to, MCS: see Vickery v Assetta [2004] FCA 555.  The relationship between the parties having now broken down it is not inappropriate to treat the amount of compensation to be allowed in an amount similar to what might have been allowed had Ms Stevenson been made redundant.

113                                       That leaves two issues – amendment to the separation statement (see [6] above) and the imposition of a penalty.  In relation to the first, assuming that I have power to make such a direction (a matter not addressed by the parties) (cf s 665(1)(d)), I do not consider that it is appropriate to direct that the separation statement be amended in light of these reasons for decision.  In general terms, the substance of the complaints made by MCS were not addressed.  These reasons for decision record those facts and the circumstances why that is so.

114                                       In relation to the imposition of a penalty – the power is discretionary: see Commonwealth Bank of Australia v Finance Sector Union of Australia (2007) 157 FCR 329 at [181] – [182] and Laz 108 IR 244 at [44].  In my view, this is a case where a penalty should be imposed.  The conduct was not innocent or inadvertent.  It was a process which MCS admitted was unfair and morally reprehensible. 

115                                       The question which then arises is the amount of penalty to be imposed.  In Construction, Forestry, Mining & Energy Union v Coal & Allied Operations Pty Ltd (No 2) (1999) 94 IR 231 at [7] – [8] Branson J set out some of the considerations to be taken into account in assessing a penalty in respect of a contravention of Pt XA (as it then was) of the WR Act: 

The [WR] Act gives no explicit guidance as to the circumstances in which an order imposing a penalty under s 298U [as it then was] of the Act will be appropriate or as to the circumstances in which a penalty of or near the maximum, or alternatively of a lesser amount, may be called for.  The Court is simply directed to consider what is appropriate in all the circumstances of the case.  

The following matters, which are not intended to comprise an exhaustive list, seem to me to be considerations to which the Court may appropriately have regard in determining whether particular conduct calls for the imposition of a penalty, and assuming that it does, the amount of the penalty:

(a)        The circumstances in which the relevant conduct took place (including whether the conduct was undertaken in deliberate defiance or disregard of the Act);

(b)        Whether the respondent has previously been found to have engaged in conduct in contravention of Pt XA of the Act;

(c)        Where more than one contravention of Pt XA is involved, whether the various contraventions are properly seen as distinct or whether they arise out of the one course of conduct;

(d)        The consequences of the conduct found to be in contravention of Pt XA of the Act;

(e)        The need, in the circumstances, for the protection of industrial freedom of association; and

(f)        The need, in the circumstances, for deterrence.

See also Kelly v Fitzpatrick (2007) 166 IR 14 at [14] and in the context of penalties under s 170CR(1)(a) (the predecessor to s 665(1)(a)), see Laz 108 IR 244 at [44] and [45] citing Fox v St Barbara Mines Ltd [1998] FCA 621.

116                                       As has been said on many occasions, the task of the Court is to fix a penalty that pays appropriate regard to the contraventions that have occurred: Kelly 166 IR 14 at [14]; Rojas 177 IR 306 at [65]; Australian Ophthalmic Supplies Pty Ltd v McAlary-Smith (2008) 165 FCR 560 at [12] and [91] and Plancor Pty Ltd v Liquor, Hospitality and Miscellaneous Union (2008) 171 FCR 357 at [60]. 

117                                       In the circumstances, I have concluded that a mid to high range penalty should be imposed.  No evidence was led to indicate that MCS had engaged in similar conduct in the past.  The person who primarily drove the conduct (Ms McColl Bowen) has since resigned from and left the employ of MCS.  However, the decision to terminate Ms Stevenson was made against a background where the relations between Ms Stevenson and MCS had got entirely out of hand.  It was a decision which was vindictive and wrong.  It was a decision which, at the very least, exploited the temporary absence of Ms Stevenson due to illness.  In addition, imposing a penalty will provide deterrence, both general and specific: Kelly 166 IR 14 at [14] and [28]; Plancor 171 FCR 357 at [37] and Australian Ophthalmic Supplies 165 FCR 560 at [88] – [90].

118                                       The maximum penalty is $10,000.00: s 665(1)(a).  I consider that, in this case, an appropriate penalty is $7,500.00.  Moreover, I consider that the penalty should be paid to Ms Stevenson: see s 841(b) of the WR Act.  MCS made no submissions about to whom the penalty should be paid.  (MCS did submit that a penalty should not be imposed). 

VII.     CONCLUSION

119                                       For the reasons stated, in VID 737 of 2009, I would dismiss the proceeding and make no order as to costs.  The factual substratum was common with proceedings VID 661 of 2009.  In VID 661 of 2009, I would order MCS to pay an amount of compensation to Ms Stevenson comprising six months remuneration (less the five weeks leave in lieu of notice she was provided on termination) and a penalty of $7,500.00.  Those amounts should be paid within 28 days. 

Associate:

Dated:         23 June 2010