FEDERAL COURT OF AUSTRALIA

Whelan v Cigarette & Gift Warehouse Pty Ltd [2017] FCA 1534

ORDERS

THE COURT DECLARES THAT:

1.    The first respondent contravened:

(a)    section 340(1) of the Fair Work Act 2009 (Cth) (FW Act) by taking adverse action against the applicant;

(b)    section 44(1) of the FW Act by failing to provide payment in lieu of notice for termination in accordance with s 117(2) of the FW Act; and

(c)    section 44(1) of the FW Act by failing to pay the applicant amounts owing to him on termination with respect to unused paid annual leave in accordance with s 90(2) of the FW Act.

2.    The second respondent was involved in the first respondent’s contraventions identified in paragraph 1 of these Orders.

THE COURT ORDERS THAT, WITHIN 30 DAYS OF THIS ORDER:

3.    Pursuant to s 545 of the FW Act, the respondents pay the applicant the sum of $17,625.72 in lieu of notice.

4.    Pursuant to s 545 of the FW Act, the respondents pay the applicant the sum of $17,160.40 for untaken but accrued annual leave.

5.    Pursuant to s 545 of the FW Act, the respondents pay the applicant the sum of $5,000 in compensation for non-economic loss.

6.    Pursuant to s 547 of the FW Act, the respondents pay the applicant interest on the compensation awarded in paragraphs 3, 4 and 5 of these Orders, such interest to be calculated from 24 August 2015 until the date of judgment in accordance with the Interest on Judgments Practice Note (GPN-INT) issued 18 September 2017.

AND THE COURT FURTHER ORDERS THAT:

7.    The amended notice of cross-claim filed on 11 October 2016 be dismissed.

8.    The applicant and respondents file submissions in respect of costs and quantum of penalties by a date to be fixed.

9.    The matter be listed for hearing in respect of costs and quantum of penalties at a date to be fixed.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

COLLIER J:

1    Pursuant to an originating application filed on 26 October 2015 the applicant, Mr Whelan, seeks orders against his former employer (the first respondent) and the managing director of the first respondent (Mr Beynon) by way of declarations and orders for the payment of his entitlements, pecuniary penalties, and compensation. Mr Whelan alleges contravention of the Fair Work Act 2009 (Cth) (FW Act), breach of the terms of his employment contract, and contravention of the Australian Consumer Law (ACL) contained in Sch 2 of the Competition and Consumer Act 2010 (Cth), by the first respondent, with Mr Beynon an accessory to those contraventions.

2    Mr Whelan claims that he was the subject of various forms of adverse action by the first respondent, including summary dismissal on 24 August 2015, after he exercised workplace rights. These workplace rights were complaints or inquiries in relation to a bonus or bonuses to which he was entitled and his refusal to ask his wife to sign a non-disclosure agreement as requested by the first respondent. Mr Whelan claims further that he was not paid accrued but untaken but accrued leave or salary in lieu of notice, and that this breached the FW Act. He also claims that prior to his commencement of employment with the first respondent various representations were made to him concerning his employment, and those representations were terms of his employment. Mr Whelan’s contractual claims also include alleged breach of a term of good faith and reasonableness in relation to the payment of discretionary bonuses by the first respondent.

3    The proceedings were complicated by a number of factors. Mr Whelan’s pleaded case progressed through several iterations, and he ultimately relies on a third further amended statement of claim filed on 10 March 2017. Mr Beynon was added as a second respondent on 29 February 2016. The first respondent is also known as “Freechoice”, although there is actually a separate related company known as Freechoice Vending Australia Pty Ltd (Freechoice Vending). Although Mr Whelan’s claims arose from his employment, his case was not limited to proceedings under the FW Act, but extended to claims under contract and the ACL. The first respondent filed a cross-claim, and subsequently an amended notice of cross-claim, seeking from Mr Whelan the sum of $70,000 as a debt due and owing, or alternatively restitution in the sum of $70,000 plus interest. Unsavoury personal allegations were made at various times during the proceedings by various witnesses against others. Recordings of conversations and activity involving Mr Whelan were secretly made by the respondents, sought to be tendered by them, and – in respect of material which were admitted to evidence – relied on by them. Despite orders requiring the parties to file a joint statement of agreed facts and issues for decision, the parties seemed unable to agree on basic matters, and filed separate statements.

4    The proceedings were notable for the identity – and absence – of witnesses who were prepared or able to give evidence. Mr Whelan gave evidence in support of his case, as did Ms Parnia Marshall (who identified herself as a “promotional model goddess for The Candy Shop Mansion” employed by the first respondent from May to November 2015). In support of the respondent’s case, evidence was given by Ms Suzanne Ozioko (the National Human Resources and Operations Manager employed by the first respondent), Mr Daniel Hains (an expert forensic accountant with Vincents Chartered Accountants), and Mr Rajesh Lal (the Group Financial Controller for the FreeChoice Australia corporate group). Curiously for proceedings of this nature, the day that he was due to be called as a witness and for unexplained reasons, Mr Beynon’s representatives told the Court he had chosen not to give evidence in the proceedings. This was surprising in circumstances where, in light of s 361 of the FW Act, the onus of proof in claims of adverse action proceedings may shift to the employer, and it is usual for the decision-maker in such proceedings to give evidence.

Background

5    Despite the apparent inability of the parties to agree on a joint statement of facts and issues in contention, there is some common ground between the parties as to background facts.

6    The first respondent carries on a business of providing services in the cigarette and gift supply industry by way of franchising. Mr Beynon has been the Managing Director of the first respondent since at least June 2014. He appears to be the public face of the first respondent, and is involved in marketing its business by staging publicity associated with a public persona he has created (I understand that Mr Beynon promotes himself as “The Candyman” and his residence at the Gold Coast as “The Candy Shop Mansion”).

7    Mr Whelan claims that Mr Beynon is the person who exercised full managerial control of the first respondent’s business and had the primary responsibility for, and control of, that business. The respondents deny this aspect of Mr Whelan’s claim. However the respondents do admit that, at relevant times and for the purposes of s 793(1) of the FW Act, Mr Beynon was the person whose state of mind (in respect of the conduct referred to in Mr Whelan’s claim) was the state of mind of the first respondent. In my view this is incontrovertible.

8    Mr Whelan was employed as the National Sales Manager of the first respondent from around 6 June 2013 to 10 November 2013, and General Manager from 11 November 2013 until 24 August 2015. Prior to his employment with the first respondent, Mr Whelan was employed by an entity he described in evidence as British American Tobacco (Aust) (BATA). Mr Whelan met Mr Beynon on a number of occasions, and in May 2013 Mr Beynon, on behalf of the first respondent, offered Mr Whelan the role of National Sales Manager with the first respondent.

9    The parties agree that the salary proposed by Mr Beynon at that time was $205,000 per annum. There is some dispute between the parties about bonuses. Mr Whelan claims that the salary was the sum of $205,000 “plus bonuses” whereas the respondents claim that Mr Beynon offered the sum of $205,000 “with the option of a bonus structure”. Mr Whelan also claims that Mr Beynon also offered him $5,000 to assist him to relocate from Sydney to the Gold Coast. This is denied by the respondents, although nothing appears to rest on this issue.

10    Mr Whelan claims that, at a business lunch in Sydney in May 2013, Mr Beynon made various representations to him, upon which Mr Whelan relied and in so doing accepted an offer of employment with the first respondent. The respondents deny that Mr Beynon said words to the effect claimed by Mr Whelan, or that Mr Beynon made the representations claimed by Mr Whelan.

11    It is, however, common ground that Mr Whelan accepted employment with the first respondent on 6 June 2013, and that he signed an employment agreement on or about that date.

12    The terms of Mr Whelan’s employment were subsequently amended, in writing. It is common ground that, on or about 12 November 2013, Mr Whelan received a letter from Mr Beynon on behalf of the first respondent, promoting him to “General Manager”, and amending his terms and conditions of employment to increase his annual salary to $230,000 (backdated to 6 June 2013) and paying him superannuation at a rate of 9.25% per annum. On 17 January 2014, Mr Whelan’s salary was increased to $309,586.

13    So far as concerns his work performance, Mr Whelan claims that his actions resulted in the first respondent’s profit increasing from $2.7 million to $6.4 million in the financial year ending 30 June 2014, and that as a result he was paid a bonus of $100,000 in or about September 2014. He further claims that his actions resulted in the first respondent’s profit increasing from $6.4 million to $10.4 million in the financial year ending 30 June 2015, but that he was not paid a bonus in respect of this performance, and that the first respondent failed or refused to pay him a bonus.

14    The respondents dispute these allegations. They say that the combined net profits before income tax of the first respondent and Freechoice Vending were approximately $2.75 million for the financial year ending 30 June 2013, and $6.4 million for the financial year ending 30 June 2014. The respondents claim that the increase in the combined net profits of the first respondent and Freechoice Vending was attributable to the first respondent and Freechoice Vending signing a new national supply agreement with United Petroleum Pty Ltd, anagreement neither negotiated nor finalised by Mr Whelan. The respondents admit that Freechoice Vending (on behalf of the first respondent) paid Mr Whelan the sum of $100,000 as a bonus for the financial year ended 30 June 2014, but say that this was because the joint net profit before tax of the first respondent and Freechoice Vending for the financial year ending 30 June 2014 had exceeded $6 million. Mr Whelan disputed this characterisation, claiming that he was responsible for securing this national supply agreement, and in any event the bonus scheme in his employment contract was conditional upon the attainment of budget targets rather than specified events.

15    Mr Whelan’s wife, Mrs Tracey Whelan, was employed by the first respondent as a Key Accounts Communications Manager on 19 November 2013. Mrs Whelan resigned in February 2015.

16    The respondents allege that, on 13 November 2014, Mr Whelan requested Mr Beynon to loan him the sum of $70,000 to enable Mr Whelan to purchase a boat. The respondents claim further that Mr Beynon agreed (on behalf of the first respondent) to pay Mr Whelan the sum of $70,000 as an advance on future entitlements payable under the employment contract, and on this basis the first respondent paid the money to Mr Whelan. Mr Whelan denies this allegation – rather he claims that the sum of $70,000 (gross) was a discretionary bonus offered by Mr Beynon in or about the first week of November 2014 and paid to him in December 2014.

17    The respondents allege that on 23 June 2015, Mr Whelan breached cl 10.1 of his employment contract by disclosing confidential information to a third party without the first respondent’s consent. Specifically, the respondents allege that Mr Whelan emailed Ms Chanel Stewart (also referred to as “Chanel Spencer”) a promotional editorial concerning Mr Beynon which was to appear in a future edition of Zoo Magazine, and not in the public domain at that time. I understand that Ms Stewart was a promotional model who had participated in the photo shoot which was featured in that promotional editorial. Mr Whelan admitted sending Ms Stewart the email, but denied that the information was confidential or that he was not authorised by Mr Beynon to send Ms Stewart the email.

18    Mr Whelan alleges that on or about 24 August 2015 he met with Mr Beynon, and asked why he had not been paid a bonus equivalent to one hundred percent of his annual salary in light of the financial performance of the first respondent. Mr Whelan claims that he also inquired at this time about a plan for the payment of a bonus in respect of the current financial year. Mr Whelan claims that Mr Beynon denied he was entitled to a bonus. The respondents deny that Mr Whelan made this bonus request, say that there was no discussion of bonuses at the meeting, and say further that the first respondent was not liable to pay Mr Whelan the bonus he alleged was his entitlement.

19    Mr Whelan alleges that he received no warning of poor or unacceptable performance of his employment duties, and received no counselling by the respondents in relation to any misconduct during his employment. The respondents disputed this, pleading that:

    An oral warning was given by Mr Beynon to Mr Whelan in or around late June 2015 concerning Mr Whelan’s behaviour and work ethic whilst on a business trip to Europe;

    An oral warning was given by Mr Beynon to Mr Whelan on 17 July 2015 concerning the failure of Mr Whelan to perform in his role to the standard expected of him by the first respondent, and Mr Whelan acknowledged this warning in an SMS sent by him to Mr Beynon on the same date; and

    An oral warning was given by Mr Beynon to Mr Whelan on 24 July 2015 concerning Mr Whelan’s (alleged) failure to perform in his role to the standard expected of him by the first respondent.

20    It is common ground that on or about 24 August 2015, Mr Whelan met with Ms Suzanne Ozioko, and Ms Ozioko asked Mr Whelan to arrange for his wife to sign a non-disclosure agreement relating to the first respondent’s business. Mr Whelan claims he asked if partners of other employees were required to sign a similar agreement, and was informed by Ms Ozioko that they were not. Mr Whelan did not arrange execution of the agreement by Mrs Whelan. The respondents concede that Mr Whelan was not legally obliged to carry out this task.

21    The respondents however dispute Mr Whelan’s claim that Mr Beynon subsequently rang him and told him that if Mrs Whelan did not sign the non-disclosure agreement, Mr Whelan’s position would be terminated.

22    It is common ground that Mr Whelan’s employment was terminated without notice and in writing by the first respondent on 24 August 2015, on the ground of breach of confidentiality.

23    In their further amended defence filed 9 March 2017, the respondents pleaded additional allegations concerning Mr Whelan’s work performance. The respondents plead that Mr Whelan’s employment was also terminated for, in summary:

    Lack of fidelity to Mr Beynon about Mr Whelan’s involvement in the disclosure of information to Ms Stewart, and having disclosed it;

    Lack of fidelity to Ms Ozioko about the fact that Mr Whelan had told Mr Beynon, during the course of a business trip to Europe, to “fuck off” when in fact Mr Whelan had not done so, and lying to Mr Beynon about it;

    A lack of trust on the part of Mr Beynon in Mr Whelan’s ability to continue to act as General Manager given Mr Whelan’s inability to manage his own financial affairs, which was discussed by them during the course of the of 24 August 2015 meeting;

    Failure to act with fidelity in his dealings on 24 August 2015 with Mr Beynon;

    Failure to comply with Mr Beynon’s oral instruction given earlier on 24 August 2015 not to leave the office before 5.00 pm that day and to attend a meeting with Mr Beynon that afternoon, by leaving the office before that time, and then failed to answer or return phone calls made to his mobile phone by Mr Beynon;

    The prospect that Mr Whelan would imminently resign from employment with the first respondent and act contrary to its interests by disclosing confidential information.

24    The respondents also plead at paragraphs 39(c)(iB) and (iC) of the further amended defence that on 24 August 2015, Mr Whelan had already decided he was resigning, had physically removed documents from the first respondent and forwarded documents to his wife by text message, and had downloaded a complete copy of the laptop with which he had been provided by the first respondent. The respondents claim that Mr Whelan’s employment was terminable by the first respondent at will pursuant to cl 9.1 of the employment contract and had the first respondent been aware of the matters pleaded in paragraphs 39(c)(iB) and (iC) it would have been entitled to terminate Mr Whelan’s employment and would have done so.

Summary of Mr Whelan’s claims

25    Mr Whelan’s claims as set out in his third further amended statement of claim can be summarised as follows:

(1)    The first respondent took adverse action against him by:

(a)    refusing to pay him the bonus to which he was entitled (paragraph 41(a));

(b)    requiring his wife to sign a non-disclosure document which partners of other staff were not required to sign (paragraph 41(a)); and

(c)    dismissing him from his employment (paragraph 41(b));

(2)    The reason the first respondent took the adverse action was because:

(a)    Mr Whelan had a workplace right to make complaints or inquiries concerning his unpaid bonus and/or the plan whereby that bonus would be calculated, and the first respondent’s request concerning Mrs Whelan’s execution of a confidentiality agreement; and/or

(b)    Mr Whelan had exercised that workplace right (paragraph 42);

(3)    Mr Whelan’s contract of employment with the first respondent was partly written and partly implied (paragraph 18), namely:

(a)    It was written to the extent of an employment agreement signed by Mr Whelan on or about 6 June 2013; and

(b)    It included a term of good faith and reasonableness in the performance of obligations and exercise of rights in the employment contract which was implied by law. This included a reasonable expectation of him receiving a share of the first respondent’s profits in accordance with his contract by way of discretionary bonus (paragraph 58);

(4)    The first respondent breached various clauses of the contract of employment, namely:

(a)    Clause 2.3 (1.0) – by failing to pay Mr Whelan bonuses and commissions for the financial year ending 30 June 2015 (paragraph 44);

(b)    Clause 2.3 (2.0) – by failing to pay Mr Whelan an incentive bonus in the financial years ending 30 June 2014 and 30 June 2015 (paragraph 45);

(c)    Clause 2.3 (3.0) – by failing to set the first respondent’s budget prior to the 2014-2015 financial year, which was a deliberate attempt by the first respondent to prevent Mr Whelan from obtaining a bonus (paragraphs 46-48);

(d)    Clause 2.3 (4.0) – by failing to provide an additional incentive bonus in the financial years ending June 2014 and June 2015 (paragraph 49);

(e)    Clause 1.5 – by failing to pay Mr Whelan untaken paid annual leave upon termination of his employment (paragraph 51). Mr Whelan claims further that the failure to pay him unused annual leave on termination constituted a breach of s 44(1) of the FW Act by reason of s 90(2) of that legislation; and

(f)    Clause 9.1 – by failing to provide Mr Whelan with three weeks’ notice of termination or payment in lieu of notice (paragraph 52). Mr Whelan claims further that this failure constituted a contravention of s 117(2) of the FW Act;

(5)    Mr Beynon was involved in the first respondent’s adverse action in contravention of ss 340(1), 117(2) and 90(2) of the FW Act (paragraphs 68-71);

(6)    Mr Beynon’s words to him at a business lunch in around May 2013 were representations concerning employment, were relied on by Mr Whelan, and were unwritten terms of his employment. Mr Beynon’s conduct was also properly characterised as liable to mislead Mr Whelan as to the nature, terms or conditions of employment (namely his prospects of career advancement and his security of employment) and thus constituted a contravention of ss 4 and 31 of the ACL (paragraphs 60-64);

(7)    Mr Beynon aided and abetted the first respondent, and/or was directly or indirectly knowingly concerned in the contravention of s 31 of the ACL by the first respondent (paragraph 66);

(8)    Mr Whelan has suffered future economic loss, non-economic loss and past economic loss (paragraphs 72-78); and

(9)    Contrary to the cross-claim of the respondents, the $70,000 advanced to Mr Whelan was not a loan, but was an advance on the bonus to which he was entitled.

26    Specifically, Mr Whelan seeks the following relief:

(1)    Declarations that the first respondent contravened:

(a)    Section 340(1) of the FW Act by taking adverse action against Mr Whelan;

(b)    Section 44(1) of the FW Act by failing to provide payment for notice in lieu of termination in accordance with s 117(2) of the FW Act; and

(c)    Section 44(1) of the FW Act by failing to pay Mr Whelan amounts owing to him on termination with respect to unused paid annual leave in accordance with s 90(2) of the FW Act;

(2)    A declaration that Mr Beynon was involved in the first respondent’s contraventions of the FW Act;

(3)    An order pursuant to s 545(2)(b) of the FW Act that the respondents pay compensation to Mr Whelan for the contraventions of the FW Act;

(4)    An order pursuant to s 546 of the FW Act requiring the respondents to pay a pecuniary penalty for breach of the contraventions of the FW Act;

(5)    An order that any penalties imposed by the Court be paid within 30 days of the order for payment;

(6)    An order pursuant to s 546(3)(c) of the FW Act requiring any penalty or penalties imposed on the respondents be paid to Mr Whelan;

(7)    Further or alternatively, the respondents pay Mr Whelan damages for breach of contract (to be assessed);

(8)    Further or alternatively, the respondents pay Mr Whelan damages to be assessed pursuant to s 236 of the ACL;

(9)    Further, an order pursuant to s 224 of the ACL that the respondents pay a pecuniary penalty for contravening s 31 of the ACL;

(10)    Interest pursuant to s 51A(1) of the Federal Court of Australia Act 1976 (Cth) on any judgment for compensation or damages; and

(11)    Costs.

27    The respondents set out detailed defences to these claims in their further amended defence.

Adverse action claim against the first respondent

28    Section 340(1) of the FW Act provides:

(1)    A person must not take adverse action against another person:

(a)    because the other person:

(i)    has a workplace right; or

(ii)    has, or has not, exercised a workplace right; or

(iii)    proposes or proposes not to, or has at any time proposed or proposed not to, exercise a workplace right; or

(b)    to prevent the exercise of a workplace right by the other person.

29    Recently in Perez v Northern Territory Department of Correctional Services [2016] FCA 476 White J summarised principles relevant to an application for relief referable to s 340(1), in the following terms:

51    As noted, s 340(1) requires that there be a causal link between the taking of the adverse action, on the one hand, and the person’s possession, exercise, or proposed exercise, of a workplace right, on the other. Section 361 has the effect of placing the onus of disproving the causal link on the respondent. At the relevant time, s 361(1) provided:

(1)    If:

(a)    in an application in relation to a contravention of this Part, it is alleged that a person took, or is taking, action for a particular reason or with a particular intent; and

(b)    taking that action for that reason or with that intent would constitute a contravention of this Part;

    it is presumed, in proceedings arising from the application, that the action was, or is being, taken for that reason or with that intent, unless the person proves otherwise.

52    Put broadly, an adverse action claim involves three elements:

(1)    a person has a workplace right, has exercised such a right, or proposes to exercise such a right;

(2)    the respondent took “adverse action” of the kind defined in s 342 against that person;

(3)    the respondent took the adverse action because of the possession, exercise or proposed exercise of the workplace right.

53    The onus is on an applicant to establish the first two elements. Section 361 has the effect that the onus is on the respondent to disprove the third element: see Tattsbet Ltd v Morrow [2015] FCAFC 62 at [119]; Construction, Forestry, Mining and Energy Union v Anglo Coal (Dawson Services) Pty Ltd [2015] FCAFC 157 at [27]-[28]; Short v Ambulance Victoria [2015] FCAFC 55 at [54].

54    The principles bearing upon a respondent’s discharge of the s 361 onus were discussed by the High Court in Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012] HCA 32; (2012) 248 CLR 500 and Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [2014] HCA 41. They were summarised by Buchanan and Tracey JJ in State of Victoria (Office of Public Prosecutions) v Grant [2014] FCAFC 184; (2014) 246 IR 441 at [32] as follows:

•    The central question to be determined is one of fact. It is: “Why was the adverse action taken?”

•    That question is to be answered having regard to all the facts established in the proceeding.

•    The Court is concerned to determine the actual reason or reasons which motivated the decision-maker. The Court is not required to determine whether some proscribed reason had subconsciously influenced the decision-maker. Nor should such an enquiry be made.

•    It will be “extremely difficult to displace the statutory presumption in s 361 if no direct testimony is given by the decision-maker acting on behalf of the employer.”

•    Even if the decision-maker gives evidence that he or she acted solely for nonproscribed reasons other evidence (including contradictory evidence given by the decision-maker) may render such assertions unreliable.

•    If, however, the decision-maker’s testimony is accepted as reliable it will be capable of discharging the burden imposed on the employer by s 361.

30    I note that the comments of Buchanan and Tracey JJ in State of Victoria (Office of Public Prosecutions) v Grant [2014] FCAFC 184; (2014) 246 IR 441 (Grant) at [32] referred to comments of the High Court in Board of Bendigo Regional Institute of Technical and Further Education v Barclay [2012] HCA 32; (2012) 248 CLR 500 (Barclay) at 517 (French CJ and Crennan J); 542 (Gummow and Hayne JJ); 545-6 (Heydon J) and Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [2014] HCA 41; (2014) 253 CLR 243 (CFMEU v BHP Coal) at [19]-[22] (French CJ and Kiefel J); [85]-[89] (Gageler J).

31    Further, I respectfully adopt White J’s articulation of principle as relevant to the current proceedings.

Did Mr Whelan have a workplace right, and did he exercise or propose to exercise such a right?

32    Mr Whelan pleads that he exercised a workplace right as defined in section 341 of the FW Act by:

    Inquiring of Mr Beynon when he would be paid an incentive bonus for the 2014/2015 financial year, or when a plan for the payment of an incentive bonus for the 2015/2016 financial year would be put in place, and

    Refusing to comply with a direction that he obtain his wife’s execution of a non-disclosure agreement.

Inquiry about incentive bonus or plan for incentive bonus for financial year ending 30 June 2015

33    Section 341(c)(ii) defines a workplace right in an employee as being the entitlement of the employee to make a complaint or inquiry in relation to his employment. In such cases as Shea v TRUenergy Services Pty Ltd (No 6) [2014] FCA 271; (2014) 242 IR 1 (Shea), Murrihy v Belezy.com.au Pty Ltd [2013] FCA 908; 238 IR 307 and Walsh v Greater Metropolitan Cemeteries Trust (No 2) [2014] FCA 456; 243 IR 468 (Walsh), s 341(c)(ii) was interpreted broadly. In Walsh [41], Bromberg J observed that the requirement in s 341(c)(ii) that a complaint or inquiry by the employee be “in relation to” his employment means that there must be a relationship between the subject matter of the complaint and the complainant’s employment. As Dodds-Streeton J further observed in Shea, a complaint that an employee is able to make in relation to his or her employment is not at large, but must be founded on a source of entitlement, whether instrumental or otherwise.

34    As a general proposition, a complaint or inquiry to the employer by an employee in relation to his or her entitlement to an incentive bonus, or the failure of the employer to prepare an incentive bonus plan, where the terms of employment of that employee make provision for payment of such bonuses or the preparation of such plans, would fall within the scope of s 341(c)(iii) of the FW Act.

35    Turning now to the present circumstances, the following conclusions may be drawn.

36    First, and temporarily placing to one side the parameters of Mr Whelan’s contract of employment, it is plain that Mr Whelan’s terms of employment contemplated payment of incentive bonuses to him. Clause 2.3 of the written contract of employment annexed to the affidavit of Mr Whelan affirmed 1 July 2016 provided:

2.3    Incentive Bonus Plan

2013-14 Bonus Plan

1.0    The employee will be eligible for an incentive bonus if the company meets budget. The actual bonus amount will be determined by your performance to the defined objectives. A minimum of $25,000 will be set for 2013-2014.

2.0    The employee will be eligible for an additional incentive bonus if the company exceeds budget. This will be a percentage base bonus – the employee will be entitled to a % of the total net amount that exceeds the agreed annual budget.

3.0    Annual Bonus Plans will be ongoing and will be set when the budget is finalised prior to each financial year beginning 2014-2015

Discretionary Bonus

4.0    The employee will be eligible for additional incentive bonuses at the discretion of the Managing Director.

(Original emphasis.)

37    It is common ground that the first respondent paid Mr Whelan a bonus of $100,000 in or about September 2014 for the financial year ended 30 June 2014, although the respondents claim that the bonus was referable to the joint net profit of the first respondent and a related entity for that financial year.

38    Second, although the respondents deny that Mr Whelan was entitled to be paid a bonus for the financial year ending 30 June 2015, he had reason to believe that he could be entitled to one. Clause 2.3 (3.0) clearly provided that annual bonus plans (presumably involving him) would be ongoing and beginning that financial year. At the very least the terms of his contract contemplated that there would be a bonus plan for that financial year.

39    Third, even if Mr Whelan was not contractually entitled to a bonus for the financial year ending 30 June 2015 in accordance with cl 2.3 (3.0) of his employment contract, he was eligible for incentive bonuses at the discretion of Mr Beynon in accordance with cl 2.3 (4.0) of the contract. A query by Mr Whelan to Mr Beynon about a bonus could plausibly refer to that clause, irrespective of the financial state of the first respondent.

40    Fourth, there is evidence before me that Mr Whelan made inquiries or complaints concerning his entitlement to be paid a bonus, or the formulation of a bonus plan by the first respondent, both in the months leading up to his summary dismissal and on the day of his dismissal.

41    In his affidavits affirmed 1 July 2016 and 7 October 2016, Mr Whelan gave evidence that he asked Mr Beynon about the prospect of being paid a bonus at least three times between May and August 2015, and that Mr Beynon was either dismissive (“Don’t worry, I will look after you.”) or angry about being asked (“Cash flow is terrible and it’s your fault, targets have not been made for the year so you won’t be getting a bonus, I am sick of you asking.”) Mr Whelan and Mr Beynon had another conversation where Mr Whelan again raised the issue of bonus, and Mr Bonus responded very aggressively. None of this evidence has been contradicted.

42    In his affidavit of 1 July 2016 at [101], Mr Whelan gave further evidence that, at his meeting with Mr Beynon on 24 August 2015, words to the following effect were said:

Me:    “Look nothing is going on, we are just having money troubles, I just thought my bonus would be coming and I’d have money to stop worrying about house payments and car payments and be able to spend money on the family, maybe take them to Africa or America.”

Travers:    “Andrew if you have worries and stress then it will affect me and the business, I need to know if anything is wrong, you have made this my problem.”

Me:    “If you take the boat out of my salary and the car I am no better off than I was a [sic] BATA, unless I get a bonus. I secured the Nightowl contract and I’ve hit the targets we spoke about I should be receiving a 100% of my salary as a bonus.”

Travers:    “You are not on top of vending, yYou [sic] need to do much better on vending. I pay you plenty of money, no one is getting a bonus this year.”

Me:    “Vending is not easy. But I will get on top of it We have much more debt here in Queensland, I was depending on the bonus.”

Travers:    “If you want a fucking bonus, get out and fucking get a bonus.”

(Emphasis omitted.)

43    More detail in respect of the discussion of 24 August 2015 became available following the tender by the respondents of a transcript of recording of that meeting between Mr Beynon (described in the transcript as Facilitator) and Mr Whelan (described in the transcript as Interviewee), marked as Exhibit 11(R) (meeting transcript). It appears that the discussion was recorded without Mr Whelan’s knowledge, however in submissions both parties referred to this document. It appears that the following conversation occurred:

Beynon:    …Or are you going to say I need the bonus of another $100,000 otherwise – so you’re telling me you were getting $400,000 – $340,000 from Barda, because that’s what you told me when we first met.

Whelan:    Yes, it was, Travers.

Beynon:    You said you got $230,000.

Whelan:    $230,000 and bonuses, Travers, and on-costs.

Beynon:    But you weren’t going to get…

Whelan:    Travers, everyone gets a bonus at Barda. You ask Jeff.

Beynon:    That wasn’t what they told me. Shannon and Jeff told me the other day, they didn’t. I remember. There was a fucking uproar. People left because of it. You told me last time, last year, and that’s why you were lucky you left, because people were so pissed at Barda because they haven’t got their bonuses, where every other year they’ve got it.

    So what money problem would you have been in then, at $230,000? It would have been the same as you are in now, because you would have had $230,000 with a $500,000 loan. Now you’re on $470,000 plus a car, so bring that back to $330,000, with an $800,000 loan. So it’s the same thing. It’s pineapples. So you’re in no worse financial position. So you shouldn’t be stressed.

Whelan:    Okay. Okay, then, mate, okay.

44    Shortly thereafter the conversation continued as follows:

Whelan:    No, I don’t want to argue with you, Travers.

Beynon:    Well, I need to know so I can fix it.

Whelan:    I came to you because I wanted to talk about long-term financial goals with Freechoice. That’s why I sent you the text, Travers, not about a bonus now, not about anything like that. To set a long-term plan. Would there be a bonus structure this year?

Beynon:    No, no, this is where you’ve got to slow down. We’re about the job at hand.

Whelan:    I’m doing the job at hand, Trav.

Beynon:    I have asked you for years now, for two years, to get vending under control. Even back to the day of Warren Henry, and you don’t get that involved. I need vending…

Whelan:    I’m in there now, Travis.

45    And later:

Beynon:    You said to me last time we had a conversation, you said you depend on the bonuses. Can you explain to me how? Where is it that you need the bonuses?

Whelan:    I’ll have to get my spreadsheet and show you.

…

Beynon:    … you don’t live like we do and the kids aren’t – they don’t eat like Valentino, and I have four kids, you have two kids. You don’t have a house like mine, with electricity and rate, which all amplifies up. You don’t have that. So living is plenty there. Where is it that you need the bonus to survive, you count on the bonus to survive? That’s what you told me.

Whelan:    Yeah, I do. I’ve always counted on a bonus in any company I’ve gone in because it’s part of any package that I’ve negotiated.

Beynon:    But where does it…

Whelan:    Again, I’ll have to get you the numbers to have a look at.

Beynon:    Well, get the numbers, then, and explain to me where you need the bonus. What about the business?

Whelan:    What do you mean?

Beynon:    You need a bonus for you. What about the business?

Whelan:    I’m not talking about this bonus. We’ve decided that. I’m asking if there’s going to be a plan for one this year. Of course I’m going to ask that question.

Beynon:    See, this is where you don’t get it. You’ve got to get this cleaned up. You’ve got to explain to me this, and then you’ve got to start to get ending back on. You’ve got to prove to me that you’re going to get the day-to-day stuff running, starting from right now. I don’t know. Where is it that the bonus is a – you will be broke if you don’t get the bonus is how you told it to me. You rely on…

Whelan:    No, I never said that.

Beynon:    You rely on the bonus to survive.

Whelan:    I rely on the bonus to do what I want to do, correct, because I have in all the previous companies, Travers, over the last 10 years.

Beynon:    I don’t care what you’ve done in your previous companies…

Whelan:    Well, I do.

46    Mr Whelan was cross-examined extensively about bonuses, including calculation of bonuses for him and other staff, and whether he had inquired about a bonus to Mr Beynon. It is clear from his answers to those questions that he placed considerable emphasis on the inclusion of bonuses as part of any salary package, both his own and that of other senior staff at the first respondent during his time there (I note, for example, transcript page 100), and that while working at the first respondent he was focused on the prospect of being paid a bonus at the end of each financial year. Mr Whelan’s evidence also indicates that Mr Beynon placed importance on bonuses to staff as part of their packages. I note, for example, Mr Whelan’s evidence of working with Mr Beynon to calculate appropriate levels of bonuses for staff (see, for example, transcript page 101 lines 23-40).

47    Mr Whelan’s evidence under cross-examination was consistent with his evidence-in-chief. So, for example, I note the following exchange:

So the first entry says – it’s between 10.08 am and 10.11 am. You say to your wife:

I don’t want to outside of work. No more. He has crossed the line now.

Is that what you were saying to her?---That is, yes.

What was that a reference to?---In reference to the fact that I had a bad meeting with him about bonuses in July, and he told me I was disrespectful to him by – for asking for it so close to his mother dying.

But what’s the reference “I don’t want to outside of work” mean?---Didn’t want to socialise with him outside of work.

(Original emphasis.) (Transcript page 159 lines 19-30)

48    Later:

No. I think you’re right. So it’s true to say, isn’t it, that at no time did you approach Mr Beynon and suggest to him that there needed to be a new annual bonus plan developed for the 2015 year?---Completely untrue.

I see. You say – - -

HER HONOUR: Sorry. So what’s completely untrue? That you - - -?---That statement. I did approach Mr Beynon on numerous occasions.

MR RONEY: There’s not a single email, is there, between you and Mr Beynon which deals with that topic. Do you agree?---I’m not sure. I don’t recall if there’s an email.

I’m putting to you that that’s the case?---Well, I don’t recall.

…

MR RONEY: Don’t recall whether there was a text or not?---No. I don’t recall. I remember there was numerous conversation because it was only four weeks into the financial year ‘15/16 that we realised that there was a serious issue with the previous financial year’s numbers.

Well, you’re aware, aren’t you, that – I will rephrase that. I think the proposition that I put to you was that you had not, in fact, texted or emailed Mr Beynon suggesting or inviting him to produce a new annual bonus plan for the 2015 financial year?---Yes. I don’t recall.

All right. It may well be that you didn’t communicate with him in those ways on that issue. Do you accept that?---No. I did discuss those issues with him. In those ways, I said?---I don’t recall.

But it may be that you didn’t, in fact?---No. I know that I did have a lot of communications within that year because it was a really big issue.

Yes. But you’re not talking about written communications. I am?---Well, that’s a form of communication.

Yes. I’m asking you about written communications. You didn’t send any written communications to Mr Beynon and, I suggest, to anyone else within FreeChoice inviting or suggesting them to revise the bonus plan for 2015?---I don’t recall.

You’re not even prepared to concede the possibility that you didn’t?---No because I don’t recall.

All right.

(Transcript page 129 lines 1-14 34-47, page 130 lines 1-14)

49    And:

All right. I’m just referring to the pleaded case that you put in each of those two documents that her Honour has just admitted. And also that which is in the current pleading. And the proposition I’m putting to you is that in the conversation with Mr Beynon on 24 August, which turned out to be the day you were dismissed, you did not ask him why you had not been paid a bonus, first of all?---No, that’s right.

And he did not say to you that you were not entitled to one, or denied that you were entitled to one?---That’s correct.

In fact, you didn’t have a discussion with him in that conversation of that day, or, I suggest, on any other day in which you were insistent on him in 5 paying you a bonus for that financial year?---That’s incorrect.

You certainly didn’t discuss it on that day, did you?---Not on that day, no.

You had a long meeting that day. As you recall it, how long did that go for?---maybe two hours.

Covered a lot of topics, yes?---Yes.

And, certainly, the issue of bonuses did come up?---Yes, it did.

Right?---Yes.

Now, it’s your case, isn’t it, as you understand it, that the reason that Mr Beynon caused his company to terminate your employment that day was that he did it to avoid paying you a bonus?---That’s correct.

But nothing happened that day which raised the prospect of you demanding that he pay you a bonus; correct?---No, that’s incorrect. I asked also about the – the future bonus.

That’s in that conversation, is it?---It is.

Right. Well, we will come to that in a moment. But you didn’t, coming back to my question, demand that he pay you a bonus of any particular kind, did you?---No.

And he didn’t refuse to provide you with a bonus of any particular kind?---Not on 24.

Nor, I suggest, on any other occasion?---That’s incorrect.

But your case remains that he terminated you that day to avoid paying you a bonus?---Yes.

And you have no basis, I suggest, for that whatsoever?---I don’t agree.

He never said to you in that meeting that you were going to be dismissed or imply that you would be dismissed if you insisted on a bonus?---No, he didn’t.

And on no other occasion when you conversed with him on the topic of bonuses, up till that day, did he suggest or imply that you would be terminated if you insisted on being paid a bonus for that year?---No. He told me I was disrespectful.

Right. So will you answer my question. On no occasion did he ever say to you, in conversation or otherwise leading up to your termination, that if you wanted or insisted on a bonus, you stood the risk of being terminated?---No, that’s – sorry. That’s correct, yes.

(Transcript page150 lines 43-47, page 151, page 152 lines 1-4)

50    Fifth, while the respondents plead that Mr Whelan was not entitled to be paid a bonus for the financial year ending 30 June 2015, I consider his entitlement or otherwise is irrelevant to the question whether he actually made a complaint or inquiry in relation to his employment for the purposes of s 341(c)(ii).

Refusing to comply with a direction that he obtain his wife’s execution of a non-disclosure agreement

51    Evidence was given in respect of this issue by Mr Whelan and Ms Ozioko.

52    It is not in dispute that, on the afternoon of 24 August 2015, Ms Ozioko asked Mr Whelan to arrange for Mrs Whelan to sign a non-disclosure agreement. In her affidavit, Ms Ozioko gives the following evidence:

92.    After my meeting with Travers, I went to Mr Whelan’s work area and asked him if he could obtain a signed confidentiality agreement from Mrs Whelan. He said to me words to the effect that Mrs Whelan shouldn’t have to sign a confidentiality agreement. He told me that I’d have to speak to Mrs Whelan myself. Mr Whelan then left the office. The time was about 2.50pm.

53    At this point however Ms Ozioko’s evidence diverges from that of Mr Whelan.

54    Mr Whelan deposes at [107] of his affidavit affirmed 1 July 2016 that he and Ms Ozioko had the following conversation:

Suzie:    ‘‘Travers has asked that Tracy need [sic] to sign this non-disclosure agreement because you went to the party at the candy mansion.”

Me:    “Is everyone’s partner that attended the party getting this today?”

Suzie:    “No but Travers has said it must be on his desk by 9am tomorrow”

Me:    “I don’t feel comfortable telling my wife to sign it. Feel free to give Tracy a call and you can discuss it with her. You have been dealing with all NDA’s [sic] the models and staff, so I will leave it to you to call Tracy and get it signed.”

(Emphasis omitted.)

55    In contrast in her affidavit affirmed 6 September 2016 Ms Ozioko deposes:

93.    I refer to paragraph 107 of the Whelan Affidavit. Mr Whelan never said words to the effect of “is everyone’s partner that attended the party getting this today?”, and I did not say words to the effect of “Travers has said it must be on his desk by 9am tomorrow”. Mr Whelan did tell me that he did not feel comfortable telling his wife to sign it and that I was free to call her myself. Mr Whelan did not say words to the effect: “You have been dealing with all NDA’s for the models and staff”. In fact, Mr Whelan and I had both been responsible for arranging for the signing of the new confidentiality agreements, so it would have made no sense for Mr Whelan to have said that to me.

56    Ms Whelan gave further evidence that around 3.10 pm on 24 August 2015 he received a telephone call from Mr Beynon in which Mr Beynon said he had been informed by Ms Ozioko that Mr Whelan refused to ask Mrs Whelan to sign the non-disclosure agreement. Mr Whelan’s evidence at [109] of his 1 July affidavit was that his conversation with Mr Beynon continued:

Me:    “I wanted to keep my work and home life separate. This is an unusual and unnecessary request. Suzie has been dealing with these and I don’t want a part of it. I am happy for Suzie and you to meet with Tracy and her Dad and explain to them why she needs to sign it today. I don’t understand why all of a sudden she needs to sign by tomorrow.”

Travers:    “It has to be signed by 9.00am tomorrow morning or else.”

Me:     “Is that a threat?”

Travers:    “Take it as you want, I am now ending this call.”

(Emphasis omitted.)

57    Mr Whelan pleads this aspect of his case in two ways. The first is as a complaint or inquiry, being a refusal to carry out a task he was not legally obliged to do and conduct by which the first respondent, through Mr Beynon, was purporting to terminate his employment if he did not comply. The second is as a particular of the adverse action, namely that the first respondent discriminated against the applicant in his employment by treating him less favourably than other employees who did not make complaints or inquiries that the first respondent required the applicant’s wife to sign a document which other employees’ partners were not required to sign. I will deal with each in turn, though note the ambiguous nature of the pleading.

58    Mr Whelan submits that his refusal to comply with this direction was a complaint in relation to his employment for the purposes of s 341(c)(ii) of the FW Act, and relies on Shea [2014] FCA 271; (2014) 314 ALR 346 at [29] where Dodds-Streeton J explained that a “complaint” for the purposes of s 341(c)(ii) was:

… a communication which, whether expressly or implicitly, as a matter of substance, irrespective of the words used, conveys a grievance, a finding of fault or accusation.

59    I am unable to identify how Mr Whelan’s refusal to accede to the request of Ms Ozioko and Mr Beynon to ask Mrs Whelan to sign a non-disclosure agreement can be described as “a complaint or inquiry” by Mr Whelan such as to fall within the scope of workplace right pursuant to s 341(c)(ii). Most favourably to Mr Whelan, the situation appears to be that Mr Whelan told Ms Ozioko that he was uncomfortable asking his wife to sign the relevant agreement, suggested that Ms Ozioko speak with Mrs Whelan herself, and then received a short and angry telephone call from Mr Beynon about the issue. Even relying on the definition of “complaint” suggested in Shea [2014] FCA 271; (2014) 314 ALR 346, I am not satisfied that anything said or done by Mr Whelan constituted a complaint in the form of a communication conveying a grievance, finding of fault or accusation. Certainly there was no “inquiry” by Mr Whelan about this issue. The terms of s 341(c)(ii) are wide, but not so wide as to include the mere resistance by Mr Whelan to Ms Ozioko’s request and his suggestion that Ms Ozioko ask Mrs Whelan about the non-disclosure agreement, and the inconclusive conversation with Mr Beynon later that day.

60    In my view this issue does not give rise to a workplace right in Mr Whelan within the meaning of the FW Act.

Was “adverse action” taken against Mr Whelan?

61    Item 1 in the table to s 342(1) of the FW Act defines adverse action taken by an employer against an employee as including circumstances where the employer:

(a)    dismisses the employee; or

(b)    injures the employee in his or her employment; or

(c)    alters the position of the employee to the employee’s prejudice; or

(d)    discriminates between the employee and other employees of the employer.

62    As I have already noted, Mr Whelan alleges that adverse action was taken against him in three different ways.

First allegation of adverse action: dismissal

63    It is common ground that Mr Whelan was summarily dismissed by the first respondent, at the direction of Mr Beynon, on 24 August 2015. This dismissal of Mr Whelan was clearly “adverse action” against him by the first respondent, as defined by item 1(a) in the table to s 342(1) of the FW Act.

Second allegation of adverse action: refusal to pay bonuses

64    The second form of adverse action pleaded by Mr Whelan was the refusal of the first respondent to pay Mr Whelan bonuses which were owed to him.

65    The evidence before the Court is that, despite Mr Whelan raising with Mr Beynon the prospect of him being paid a bonus or the prospect of the first respondent preparing a bonus plan, the first respondent, through the second respondent, informed Mr Whelan that he would not be paid a bonus. To the extent that this conduct could be “adverse action” it could only fall within s 342(1)(c) or (d) of the FW Act, namely where an employer:

(b)    injures the employee in his or her employment; or

(c)    alters the position of the employee to the employee’s prejudice;

66    In my view, Mr Whelan was not owed bonuses, such that a refusal by the first respondent to pay him bonuses he has claimed constituted an injury to him in his employment or altered his position to his prejudice. I have formed this view for reasons I will explain later in this judgment in the context of Mr Whelan’s claim of breach of contract.

Third allegation of adverse action: requirement that Mrs Whelan sign a non-disclosure agreement

67    The third type of adverse action alleged by Mr Whelan was the requirement of the first respondent that Mrs Whelan sign a document which other employees’ partners were not required to sign.

68    It is difficult to identify the basis on which Mr Whelan claims that he was the subject of adverse action in this respect.

69    First, the pleading in paragraph 41(a)(ii) of the third further amended statement of claim refers to conduct of the first respondent in respect of Mrs Whelan, not Mr Whelan. On the basis that Mr Whelan could not dictate Mrs Whelan’s decision to execute (or refuse to execute) a non-disclosure agreement, the action of the first respondent as pleaded was directed towards Mrs Whelan, not the applicant.

70    Second, to the extent that Mr Whelan was concerned by the alleged requirement, the evidence shows that Mr Whelan’s principal concern was that he was being tasked with arranging this with Mrs Whelan, when in his view it was Ms Ozioko’s job to approach Mrs Whelan about it. In particular I note his evidence at [107] of his affidavit noted above.

71    Indeed, in cross-examination Mr Whelan accepted that it was reasonable for the first respondent to approach Mrs Whelan to ask her to sign a non-disclosure agreement, because confidentiality in respect of events at The Candy Shop Mansion was important and Mrs Whelan attended such events. In particular I note the following exchange between Mr Roney QC for the respondents and Mr Whelan:

Now, having regard to what I think you’ve agreed was important about protecting confidentiality associated with what happened at the Candy Store Mansion – Candy Shop Mansion, you would accept, wouldn’t you, that it was reasonable to have people like your wife, who were allowed to go to functions there, to sign nondisclosure agreements?---Only in the last couple of months, yes. Yes.

But you accept that it was reasonable to expect people who were going to be allowed to come to those to sign up confidentiality agreements which would cover their attendances, whenever that was?---Yes. Yes.

And on 24 August, Ms Ozioko came to you, didn’t she, and asked you to give effect to some arrangements that she was trying to put in place to get your wife to sign one of those?---Yes, she did.

And you didn’t feel comfortable about asking your wife to do that?---I didn’t, no.

And you effectively said to her, look, if that’s what you need to do, you do it?---Yes. I asked her firstly who else’s partner was signing them that day.

Yes?---And I said to her I don’t feel comfortable in doing that, because she looked after all the nondisclosure agreements, not me.

All right. So was that the only conversation you had with anyone that day, apart from your wife, I mean, about this need to have a confidentiality agreement signed, or a nondisclosure agreement signed?---No. Travers Beynon contacted me as well after that conversation and asked me to do the same thing that Suzie asked me.

All right. And do you remember what he said?---Yes.

Can you tell us?---He said to get it done tomorrow or else. He asked me prior to that why I did not feel comfortable, everyone should be signing nondisclosure agreements. He has to be done by 9 am tomorrow. I asked him if it was a threat. He said you can take it as you will, but it needs to be on his desk by 9 am tomorrow. I again said to him I don’t feel comfortable in doing that. At no time did I say Tracey would not sign it. But what I said is that Tracey would actually speak with her father and look to why she needed to sign that document. But I would prefer Ms Ozioko or himself to contact my wife, because I didn’t feel comfortable in doing that.

And we know, don’t we, that he then did speak to Ms Ozioko about that, and Ms Ozioko did approach your wife?---That’s right.

(Transcript page 220 lines 6-45)

72    Third, if Mr Whelan had considered the first respondent’s requirement in respect of Mrs Whelan inappropriate or discriminatory of him, he could have told Ms Ozioko this.He did not. Instead, Mr Whelan’s evidence was that he suggested that Ms Ozioko contact Mrs Whelan directly. Ms Ozioko gave evidence that following her conversation with Mr Whelan she did what Mr Whelan told her, and contacted Mrs Whelan directly. Ms Ozioko’s unchallenged affidavit evidence was as follows:

95.    At approximately 3:08pm, I sent a text message to Mrs Whelan. The text message read:

“Hi Tracy

I need to set up a time to have you sign the confidentiality agreement, we are having everyone that has attended and been involved in events and will be in the future sign and you and tori are my last ones. Can we coordinate this? I can come to you if necessary? I need to get this done by tomorrow. Let me know.

Regards

Suzie”

96.    I did not receive a response to my text message.

73    Fourth, I note the unchallenged evidence before the Court that when Mr Whelan told Ms Ozioko that she (rather than he) should contact Mrs Whelan, Ms Ozioko informed Mr Beynon who then rang Mr Whelan and told him to have the signed agreement by Mrs Whelan on his desk the following morning, “or else.” The respondents concede that this instruction had an imperative element to it, however, they submit that it was scarcely a demand in relation to an issue of such critical significance that non-compliance with it then and there would have resulted in Mr Whelan’s dismissal. I agree. “Or else” potentially covers a range of consequences, including further unpleasant conversations with Mr Beynon. Dismissal of Mr Whelan was not threatened at that stage by Mr Beynon.

74    Fifth, Ms Ozioko gave the following evidence:

93.    I refer to paragraph 107 of the Whelan Affidavit. Mr Whelan never said words to the effect of “is everyone’s partner that attended the party getting this today?”, and I did not say words to the effect of “Travers has said it must be on his desk by 9am tomorrow”.

75    Contrary to Ms Ozioko’s evidence, I consider it plausible that Mr Whelan did ask whether other employees’ partners were receiving non-disclosure agreements that day. I consider this plausible because Mr Whelan had earlier that day been party to a difficult conversation with Mr Beynon, and it is possible that he was feeling defensive in its aftermath. However, it does not follow, even if Mr Whelan understood that only Mrs Whelan was being approached for a non-disclosure agreement, that he objected. Indeed his other evidence suggests he thought it appropriate that Mrs Whelan be asked to sign a non-disclosure agreement, because of her privileged position in being invited to attend functions at The Candy Shop Mansion, and the clear importance of confidentiality to the first respondent.

76    I do however accept Ms Ozioko’s evidence that she did not tell Mr Whelan that Mr Beynon had said the agreement must be on his desk by the following morning. Ms Ozioko reported to Mr Whelan, and I consider it unlikely that she would have made this communication to her manager in the form of the ultimatum alleged by Mr Whelan.

77    Sixth, although Mr Whelan does not specifically plead s 342(1)(d), I note that that section defines adverse action as including where an employer discriminates between the employee and other employees of the employer. Mr Whelan pleads at [41(a)(ii)] that the first respondent discriminated against the applicant in his employment by treating him less favourably than other employees who did not make complaints or inquiries in that the first respondent required Mr Whelan’s wife to sign a document which other employees’ partners were not required to sign. However, I am not satisfied that the facts as pleaded supports a finding of discrimination. To the extent that “discrimination” in s 342(1)(d) of the FW Act bears the ordinary dictionary meaning of “to treat employees differently” (see the discussion in Creighton WB, Creighton and Stewart’s Labour Law (6th ed, Federation Press, 2016) at [20.48] (Creighton and Stewart)) there is no evidence that Mr Whelan was treated differently from other employees. Rather, it is apparent that Mrs Whelan was being asked by the first respondent to sign a non-disclosure agreement because she had been allowed to attend functions at The Candy Shop Mansion. I consider it likely that if partners of other executives attended such functions, they would also have been asked to sign non-disclosure agreements.

78    I consider that Mr Whelan’s claim of adverse action against him relating to Mrs Whelan being required to sign a non-disclosure agreement has no merit.

79    The next – and key – question is whether the adverse action taken by the first respondent against Mr Whelan in the form of summary dismissal was because Mr Whelan exercised a workplace right.

Was there a causal nexus between the exercise by Mr Whelan of a workplace right and the adverse action taken against him?

80    The evidence before the Court demonstrates that Mr Whelan had made inquiries about either payment of a bonus or the establishment of a bonus plan both in the weeks prior to, and on the day of, his dismissal. These inquiries can properly be characterised as complaints or inquiries in relation to his employment, and therefore the exercise of a workplace right.

81    It follows that not only was adverse action taken, but also a relevant workplace right existed as an objective fact: Tattsbet Limited v Morrow [2015] FCAFC 62; (2015) 233 FCR 46 at [119]; Construction, Forestry, Mining and Energy Union v Anglo Coal (Dawson Services) Pty Ltd [2015] FCAFC 157; (2015) 238 FCR 273 at [76], [132]. There was a causal nexus between the exercise by Mr Whelan of a workplace right and the adverse action taken against him.

Reason for the adverse action taken against Mr Whelan by the first respondent

82    Turning now to this issue, I note the following preliminary points.

83    First, the onus rests with the first respondent to disprove the presumption which the Court now entertains that the adverse action against Mr Whelan was taken for a reason proscribed by the FW Act, namely because Mr Whelan exercised a workplace right.

84    Second, as Buchanan and Tracey JJ observed in Grant at [32] it is extremely difficult for an employer to displace the statutory presumption in s 361 if no direct testimony is given by the decision-maker acting on behalf of the employer. That is precisely the position in this case. The decision-maker in respect of Mr Whelan’s summary dismissal was, without doubt, Mr Beynon. That this is so is evident from Mr Whelan’s termination letter of 24 August 2015 signed by Mr Beynon on behalf of the first respondent (and marked as annexure AW-15 to Mr Whelan’s affidavit affirmed 1 July 2016), evidence of Ms Ozioko that Mr Beynon had told her on 24 August 2015 that he “had no choice but to terminate [Mr Whelan’s] employment” (see Ms Ozioko’s affidavit affirmed 6 September 2016 at [100]), and the admission of the respondents that Mr Beynon was the managing director of the first respondent at that time and in that role he had oversight of the operation of the first respondent’s business activities and managed its senior staff. However, Mr Beynon has not given evidence concerning Mr Whelan’s summary dismissal. As Mr Whelan correctly submits, this lacuna in evidence makes it difficult for the Court to determine with absolute clarity the “real” reasons for Mr Whelan’s dismissal on 24 August 2015.

85    Third, in the absence of evidence given by Mr Beynon, the respondents relied heavily on the transcript of the recorded meeting between Mr Beynon and Mr Whelan of 24 August 2015. While this transcript is in evidence, I treat it and its contents with caution. Mr Whelan’s statements during the course of that meeting either were, or could have been, tested and clarified at the hearing by cross-examination. Mr Beynon’s statements were not tested, and could not be tested, given that he gave no evidence in the proceedings.

The respondents’ case

86    With the onus resting on the respondents in mind, I now turn to the arguments advanced by the respondents as to why Mr Whelan was dismissed.

87    The respondents submit that “it is unquestionably the case” that Mr Beynon terminated Mr Whelan’s employment because Mr Whelan had breached confidentiality associated with the publication of an article and associated photoshoot in Zoo Magazine by giving an advance copy of that article to Ms Chanel Stewart, such conduct being “gross misconduct” on Mr Whelan’s part. Relevantly I note that cl 9.1 of Mr Whelan’s contract entitles the first respondent to dismiss him without notice in the event of gross misconduct.

88    In written submissions the respondents elaborate:

116.    The justifications included those matters, but others that were in the mind of Ms Ozioko and Mr Beynon namely:

(a)    lying to the Second Respondent about the Applicant’s involvement in the disclosure of the Zoo article information above and his having disclosed such information;

(b)    lying to Ms Suzie Ozioko about the fact that the Applicant had told the Second Respondent during the course of the business trip to Europe to “fuck off” when the Applicant had not in fact done so, and lying to the Second Respondent in relation to that conversation both since and on the day of termination;

(c)    a lack of trust on the part of the Second Respondent in the Applicant’s ability to continue to act as General Manager given the Applicant’s inability to manage his own financial affairs, which matter was discussed during the course of the meeting that day;

(d)    the Applicant failing to act in a truthful way in his dealings on 24 August 2015 with the Second Respondent;

(e)    the Applicant’s failure to comply with the Second Respondent’s oral instruction given earlier on 24 August 2015 not to leave the office before 5.00pm that day to attend a meeting with the Second Respondent that afternoon, by leaving the office before that time;

(f)    in the circumstances the Applicant’s intention or failure to either answer or return telephone calls made by the Second Respondent to the Applicant’s mobile phone; and

(g)    the prospect, having regard to the matters pleaded in paragraphs A to F above that the Applicant would imminently resign from his employment with the First Respondent and act contrary to the First Respondent’s interests including in disclosing confidential information.

89    As to the allegation that Mr Whelan failed to act in a truthful way in his dealings on 24 August 2015 with Mr Beynon, the respondents particularised the allegation in [117] of their written submissions of 18 May 2017 as follows:

(a)    Mr Whelan was perceived to be evasive in telling the truth about the reasons he was in such financial circumstances Beynon asked Whelan whether he had purchased a new property and Andrew said no. Mr Whelan had purchased a new property just weeks early. The relevant part of exhibit 11 contains this exchange …

(b)    Mr Whelan was perceived to be evasive in telling the truth about and Whelan continued to deny that he had told Ms Ozioko that he’d told Travers to “fuck off” on the European trip when Beynon believed he had done so …

(c)    Mr Whelan was perceived to be evasive in telling the truth about whether he had been absent from work whilst Travers and Suzie were away from the office in July which Mr Beynon did not believe …

(d)    Mr Whelan was perceived to be evasive in telling the truth about Andrew denied that he had been leaving work before 5pm …

90    Ms Ozioko gave evidence concerning the importance of confidentiality in the business dealings of the first respondent. There was extensive cross-examination of Mr Whelan concerning this issue, during which Mr Whelan accepted that confidentiality in the business practices of the first respondent was of high importance to it.

91    The respondents submit that, reduced to a minimum, Mr Whelan’s case is that there was a sham or deceit in relation to the reason for termination, and that he was not really terminated for breach of confidentiality, or for any other reason, but to ensure Mr Whelan was not paid a bonus when he was otherwise entitled to one. They submit further that the cross-examination of Ms Ozioko left the majority of her evidence on the issues which are critical to the determination of this case almost entirely untouched and unchallenged and that her evidence directly explained the process of thinking in the first respondent leading up to Mr Whelan’s dismissal.

92    The respondents submit that when Mr Whelan contacted Mr Beynon on 17 August 2015 he said nothing to Mr Beynon about a bonus.

Evidence before the Court

93    I have already referred to evidence of Mr Whelan as to his exchanges with Mr Beynon concerning Mr Whelan’s request for a bonus in the financial year ending 30 June 2015, and the transcript of the recording of the meeting between Mr Beynon and Mr Whelan of 24 August 2015 so far as concerned bonuses. I have also noted that Mr Beynon has not given evidence of his reasons for dismissing Mr Whelan.

94    Although initially relying on Mr Whelan’s alleged gross misconduct, the case of the respondents expanded to claim that the “real” reasons for Mr Whelan’s dismissal were his gross misconduct in breaching confidentiality, his lack of candour, the inability of Mr Beynon to trust him, his failure to follow oral directions, and the belief of Mr Beynon that Mr Whelan was about to resign. In order to understand the respondents’ defence it is necessary to have regard to such evidence as is before the Court.

Evidence of Mr Whelan

95    Mr Whelan gave evidence that in about May 2015, Mr Beynon held a “Candyman” photo shoot at his house, attended by senior staff including Mr Whelan, and that Mr Beynon informed them that the photographs were intended to appear on social media to promote the business as well as in Zoo Magazine. In his affidavit affirmed 1 July 2016, he continued:

128    Shortly after the photo event, Travers and I went overseas on a business trip on behalf of Freechoice, but which I understood was really just an opportunity for more photos to promote the “Candyman” image that Travers believed would promote Freechoice. I say this because there was no work done for Freechoice only photo shoots and he bought along his photographer from Australia. Whilst overseas, I received an electronic copy of the article from Zoo Weekly Magazine on my phone, which included some of the photos taken at the photoshoot. I shared this article and photos with Travers whilst staying at a hotel in Spain and we read through the article together.

129.    Later that afternoon, one of the models of the photo shoot, Chanel Spencer, sent me a text message and asked if I had a copy of the Zoo Magazine article as the magazine article had sold out in stores at home. I had a conversation with Travers to the following effect:

Me:    “Chanel has texted me asking if she can get a copy of the Zoo article because she can’t get a copy back home as it sold out. Is it ok if I send it to her?”

Travers:    “No problems how cool is it that it is sold out.”

130.    I then forwarded the photos and article to Chanel via email. Annexed and marked AW-16 is a copy of the Zoo Magazine article.

131.    Following subsequent discussions with Travers’ publicist, I learnt that the Zoo Weekly magazine was not due to be published until the next week. I wasn’t concerned that I had sent this to Chanel and this was never discussed any further with Travers or the publicist Bruce Nelson. It was never bought to my attention that I had breached any confidential communication provisions of the employment contract as a result of forwarding the Zoo article to Chanel until I received the letter of termination.

(Emphasis omitted.)

96    Annexure AW-16 to Mr Whelan’s affidavit is an email dated 23 June 2015 from Mr Whelan to Ms Stewart, attaching an article containing numerous photographs of Mr Beynon with women wearing bikinis, and prose under the heading “The Aussie who’s living the dream”. The email read:

Hey Babe

Hope you get this

Andrew

97    The email also forwarded an earlier email to Mr Whelan from Mr Bruce Nelson of Zakazukha Marketing Communications which read “Hi Andrew, To discuss later today” and attached the article.

98    Mr Whelan was extensively cross-examined by Mr Roney QC for the respondents about events related to the Zoo Magazine article and the trip to Europe. Mr Whelan gave evidence including the following:

    It was Ms Ozioko’s job, not his job, to get non-disclosure agreements signed by participants in the ZOO Magazine photoshoot (transcript page 184 lines 21-27);

    He had verbal authority from Mr Beynon to send Ms Stewart the Zoo Magazine article. Mr Beynon never expressed any annoyance or anger to Mr Whelan concerning Mr Whelan’s action in sending Ms Stewart the Zoo Magazine article (transcript page 185 lines 20-28, page 186 lines 39-47);

    Mr Beynon accused him of “falling in love” with one of the promotional models, Ms Scarlett Bouvier, on a yacht during the Europe trip (transcript page 196 lines 1-4, page 199 lines 32-45). Mr Whelan gave evidence denying this, and further that he told Mr Beynon to “piss off” (transcript page 196 lines 6-10, page 200 lines 4-6);

    During the Europe trip in June 2015, Mr Beynon complained that Mr Whelan spent too much time with the promotional models rather than with him (transcript page 199 lines 14-19);

    On his return to Australia from the trip to Europe in June 2015, he did not tell Ms Ozioko that he had told Mr Beynon to “fuck off” – he told Ms Ozioko that he and Mr Beynon had had an argument (transcript page 193 lines 43-44). Mr Beynon was furious that Mr Whelan had told Ms Ozioko that they had argued during the trip (transcript page 194 line 16);

    He did not answer Mr Beynon’s telephone calls around 4.00 pm on the afternoon of 24 August 2015 because he did not hear or see Mr Beynon’s missed calls, being at the time attending a medical appointment because he felt unwell (transcript pages 282-283);

    He sent the following text message to his wife at 12.16 pm on 24 August 2015 after meeting with Mr Beynon:

Terrible. He’s a cunt, darling. I can’t stand it any more and can’t put up with his abuse and shit. No bonus, no bonus structure this year. Said he will give a bonus when he feels like it. I need to leave ASAP.

Under cross-examination Mr Whelan said that this did not meant that he intended to resign at that point – rather he was upset at Mr Beynon because of their meeting of earlier that day (transcript page 271 lines 1-18);

    Mr Beynon had said the following words to Mr Whelan on the morning of 24 August 2015:

I have a problem with you not being in the office as much as you should be. That has got to change. If you’re going to get a doctor’s appointment, it’s not in the afternoon, especially a Friday. You be here especially with vending. Make sure you’re there.

Mr Whelan conceded that Mr Beynon had a perception that Mr Whelan was taking time off when he should have been at the office, however Mr Whelan denied that this was the case (transcript page 267 lines 31-43). Under cross-examination Mr Whelan also gave the following evidence:

Did he communicate to you in that meeting that he believed that you spent too much time with your family and not enough at work?---Yes, I believe so.

Did you decide that you didn’t want to have anything to do with him any more?---I thought that was unfair, what he said.

(Transcript page 270 lines 21-25)

    In relation to whether Mr Whelan and Mr Beynon were to have a meeting later in the day on 24 August 2015:

Now, after the meeting that day, you were due to see him later on the day – on that day, weren’t you?---No. Incorrect.

All right. You would normally, though, liaise with him during the day on a workday, wouldn’t you?---During the day, yes, when he was in.

So – and he was in that day, was he not?---Only till about 1.30/2 o’clock – - -

Right?--- – - – as he normally is.

Okay. But in any event, on a normal day as this was apart from the fact that you had this meeting, you would be interacting with him in the course of doing your ordinary duties?---All depends what he’s doing as well.

Yes?---Yes.

But on an ordinary day, that’s what would happen?---Well, there was never an ordinary day because he wasn’t there very much.

(Transcript page 266 lines 5-22)

99    I have already set out in some detail the evidence given by Mr Whelan during cross-examination in relation to whether he had asked Mr Beynon about bonuses, or bonus plans, in the time prior to and on the day of his dismissal.

Evidence of Ms Parnia Marshall

100    Ms Marshall gave evidence that she was at The Candy Shop Mansion on the evening of 24 August 2015 with Mr Beynon and Ms Ozioko when “there was a conversation that was held mainly to do with Andrew’s firing – being sacked.” Ms Marshall continued:

And basically how the conversation started was Travers pretty much said he’s gone, he’s gone, and Suzie said words to the effect of – to do with the Zoo Magazine article. Did you tell him that you could send it on? Did – like, you know, that was pretty much what was said. And then Suzie – and then Travers said yes, I did, but we were away on holidays. And then Suzie said do you have any, like, text message proof of that or any email proof of that. And then Travers replied no, and then he said – he said I can fire him – I can get rid of him for that, and he goes he won’t have the money to fight me in court anyway. And then to finish up the conversation, like, he was sort of smirking at the time after he said that, and then to finish off the conversation he was like, don’t pay him – sorry to swear, but – a fucking cent.

(Transcript page 358 lines 37-46)

Evidence of Ms Ozioko

101    In her affidavit affirmed 6 August 2016, Ms Ozioko deposes that both she and Mr Whelan worked at The Candy Shop Mansion on the day of the Zoo Magazine photoshoot in early June 2015, to ensure that all of the participating models and photographers signed confidentiality agreements. Ms Ozioko deposes that, on or about 22 June 2015, she received an email from Mr Whelan with a copy of the proposed ZOO Magazine article. She understood from the public relations company that the article would be published in the next edition of Zoo Magazine. Ms Ozioko deposes further:

71.    On the morning of 29 June 2015, Travers invited me to his home for a meeting. He told me about some incidents that had occurred on a recent trip to Europe involving Mr Whelan. He was quite upset with Mr Whelan’s performance and told me that he had had to reprimand him at the end of the trip. Travers also told me that it had come to his attention that someone had disclosed a copy of the proposed Zoo Magazine article to Ms Chanel Stewart, one of the models that had been working for ‘Freechoice Australia’ at the photo shoot. Travers asked me to look into who had disclosed the document without permission.

72.    Whilst I was at Travers’ home that day, Travers received a call from the hospital informing him that his mother had lost consciousness. He left for the hospital immediately. Travers’ mother died later that day. He did not return to work for some time after that.

73.    Later that day I had a meeting with Mr Whelan during which he told me that he and Travers had got into an argument on their Europe trip and that he had told Travers that he was “done with Freechoice” and that Travers could “go fuck himself’ and that he wanted nothing more to do with him. I was shocked to hear that.

74.    Because of the death of Travers’s mother, I did not see much of Travers around that time; however, we did speak on the phone from time to time.

75.    I recall that several days after the conversation with Mr Whelan that I described above, I had a conversation with Travers. I mentioned during that conversation that Mr Whelan had told me there had been an argument during the Europe trip. Travers asked me what Mr Whelan had told me. I repeated what Mr Whelan had told me. Travers told me that Whelan’s version of events was a complete fabrication. He said that he was upset about what Mr Whelan had told me but that he would have to deal with it later because of the personal issues he was dealing with at that time.

76.    To the best of my recollection, approximately a few days after Travers’ mother’s funeral, on or about 17 July 2015, Travers called Mr Whelan to a meeting at his house. I understand from a subsequent discussion with Travers that at the meeting Travers spoke to Mr Whelan about his performance generally and about Mr Whelan’s version of their argument on their Europe trip.

77.    Mr Whelan had met with Travers on 17 July 2015, Mr Whelan returned to the office and called me in to the boardroom. He told me that Travers had given him a dressing down about what I had told Travers that Mr Whelan had said to me (namely that he was “done with Freechoice”). Mr Whelan told me that he’d be more careful what he said around me in the future. I felt he was rude and intimidating toward me. He then stormed of the boardroom and left.

78.    In or around the beginning of August 2015, I contacted Ms Chanel Stewart’s manager, Ms Jacqueline Armstrong and asked her who had disclosed the Zoo Magazine article to Ms Stewart. Ms Armstrong told me that that Mr Whelan had emailed the article to Ms Stewart. She subsequently provided me with a copy of that email. I reported this back to Travers.

102    The respondents submit that, before the Court, there is unchallenged evidence of Ms Ozioko that Mr Beynon was very angry when he discovered that the publication of the Zoo Magazine article had occurred immediately after his return from a trip to Europe, and that there is independent objective evidence to demonstrate that Mr Beynon had never authorised the publication of photos from the Zoo Magazine photoshoot while he was overseas. The respondents relied heavily on testimony of Ms Ozioko, emphasising that key aspects of her evidence were unchallenged by cross-examination or otherwise. This evidence is summarised at [157] of the respondents’ written submissions and includes:

    Her evidence that Mr Whelan’s signed employment agreement and confidentiality agreement were missing;

    All of her evidence in relation to the circumstances of the bonus scheme;

    Her evidence about Mr Whelan’s work hours and conversation with him about it;

    The fact that Mr Whelan would, from time to time, yell and swear at employees;

    What occurred at The Candy Shop Mansion photo shoot in June 2015;

    The conversation with Mr Beynon on 29 June 2015 that it had come to his attention that the ZOO Magazine article had been leaked;

    The conversation in which Mr Whelan told her about verbally abusing Mr Beynon and said that he wanted nothing more to do with him;

    The later conversation with Mr Beynon in which they discussed this alleged abuse by Mr Whelan on the trip and Mr Beynon saying he was upset about that having been a fabrication;

    Her evidence that after Mr Whelan had been given a dressing down by Mr Beynon on 17 July 2015, Mr Whelan came to her and said he would be more careful about what he said to her in the future in a rude and threatening way; and

    Her evidence that there was no conversation with Mr Whelan in which he said he was expecting a bonus.

Conclusions

103    The decisions of the High Court in Barclay and CFMEU v BHP Coal, read with relevant provisions of the FW Act, provide guidance on the appropriate approach the Court should take in determining the reason or reasons that the adverse action was taken against Mr Whelan by the first respondent.

104    Ascertaining why, for the purposes of s 361(1) of the FW Act, an employer took adverse action against an employee involves determination of the “particular reason” of the decision-maker for taking that adverse action: Barclay at [42], [43], [45], [127]; CFMEU v BHP Coal at [9], [38]. Identification of the decision-maker is, accordingly, critical. I have already observed that the person who made the decision to dismiss Mr Whelan was Mr Beynon. I do not understand there to be any dispute about this point.

105    Section 360 of the FW Act provides that, for the purposes of that Part of the Act, a person takes action for a particular reason if the reasons for the action include that reason. If a substantial or operative reason for Mr Whelan’s dismissal was his complaints or inquiries concerning payment of bonus, the first respondent has contravened the FW Act even if it was only one reason for the first respondent’s actions: Barclay at [56], [57], [85], [88], [127]; CFMEU v BHP Coal at [85], [89], [90].

106    As I have already noted, Mr Beynon did not give evidence of why he decided to dismiss Mr Whelan. In light of my earlier findings that, as an objective fact, Mr Whelan exercised a workplace right and was then the subject of adverse action, s 361 of the FW Act operates such that the onus lies on the respondents to prove, on the balance of probabilities, that the relevant adverse action taken against Mr Whelan was not for his exercise of the workplace right (and therefore not in contravention of the FW Act). The absence of any evidence from Mr Beynon makes much more difficult the task of the Court in determining Mr Beynon’s reason or reasons for dismissing Mr Whelan. However, while direct evidence of a decision-maker as to his or her state of mind, intent or purpose will bear upon the question of why adverse action was taken, the central question remains “why was the adverse action taken?”: Barclay at [44], CFMEU v BHP Coal at [39]. The Court is required to determine the reason as a question of fact, which must be answered in the light of all the facts established in the proceeding: Barclay at [41], [45].

107    All relevant facts are identifiable by reference to the evidence before the Court. Examining that evidence, I am not satisfied that the respondents have discharged the onus of proving that Mr Whelan’s exercise of a workplace right was not a substantive or operative reason for his dismissal. I take this view for the following reasons.

108    First, I have already found that Mr Whelan asked Mr Beynon about his entitlement to a bonus or the development of a bonus plan on multiple occasions prior to 24 August 2015. Mr Whelan specifically asked Mr Beynon about the development of a bonus plan pursuant to which a bonus would be paid to him on 24 August 2015, when adverse action was taken against Mr Whelan. Relevantly, I am also satisfied that, both prior to 24 August 2015 and on that date, Mr Beynon was angered by Mr Whelan’s inquiries because he was concerned about the financial state of the first respondent, and because he considered that Mr Whelan did not deserve a bonus and should not be asking for one.

109    Mr Whelan gave undisputed evidence that Mr Beynon was angered by Mr Whelan raising the issue of bonuses in July 2015 around the time of the death of Mr Beynon’s mother, and that Mr Beynon considered that Mr Whelan had been disrespectful to do so (transcript page 159 lines 25-27). I accept that this is plausible.

110    Turning to the transcript of the meeting of 24 August 2015, I note that Mr Whelan explained to Mr Beynon that he had acquired too many debts, was having difficulty paying them, and it was in that context that he had pressed Mr Beynon earlier in the year for a bonus and was continuing to press for a bonus plan to be developed. During the course of the meeting the following exchanges took place between Mr Beynon and Mr Whelan:

Beynon:    So it’s $850,000, but it wouldn’t be anything more, so that might go up a couple of grand, but still, where’s $93,000 gone?

Whelan:    I don’t know. As I said, I don’t know. I’ve got all my spreadsheet of everything at home that we do on our expenses and everything.

Beynon:    But where would it be? The point is, I don’t...

Whelan:    When we got the bonus last year, we had a holiday. We put money on our credit cards that we owed. We had to do some things around the house that needed fixing.

Beynon:    So I understand the holiday. Credit card. If you put money off that, then that would be less. That’s based on $30,000.

Whelan:    Yes, it is.

(Meeting transcript page 9)

111    I also note the following:

Beynon:    …Then I rang you and said whoa, what the fuck is going on? Because if you had come to me, I would have done this same thing. Let me help you. This is how I know. How else do you want me to help you? You’re on $470,000, and if it’s not that, it’s $309,000 plus possible bonuses. Now, that’s a fucking lot of money, and I fucking want to get to the bottom of it, because I need to know if you’re capable of handling money, one, and two, are you going to pull the pin at some point because you’re not going to get your shit worked out?

    Or are you going to say I need the bonus of another $100,000 otherwise – so you’re telling me you were getting $400,000 – $340,000 from Barda, because that’s what you told me when we first met.

Whelan:    Yes, it was, Travers.

Beynon:    You said you got $230,000.

Whelan:    $230,000 and bonuses, Travers, and on-costs.

Beynon:    But you weren’t going to get...

Whelan:    Travers, everyone gets a bonus at Barda. You ask Jeff.

Beynon:    That wasn’t what they told me. Shannon and Jeff told me the other day, they didn’t. I remember. There was a fucking uproar. People left because of it. You told me last time, last year, and that’s why you were lucky you left, because people were so pissed at Barda because they haven’t got their bonuses, where every other year they’ve got it. So what money problem would you have been in then, at $230,000? It would have been the same as you are in now, because you would have had $230,000 with a $500,000 loan. Now you’re on $470,000 plus a car, so bring that back to $330,000, with an $800,000 loan. So it’s the same thing. It’s pineapples. So you’re in no worse financial position. So you shouldn’t be stressed.

Whelan:    Okay. Okay, then, mate, okay.

(Meeting transcript pages 15-16)

112    Shortly afterwards in the discussion the following exchange occurred:

Whelan:    I came to you because I wanted to talk about long-term financial goals with Freechoice. That’s why I sent you the text, Travers, not about a bonus now, not about anything like that. To set a long-term plan. Would there be a bonus structure this year?

Beynon:    No, no, this is where you’ve got to slow down. We’re about the job at hand.

Whelan:    I’m doing the job at hand, Trav.

Beynon:    I have asked you for years now, for two years, to get vending under control. Even back to the day of Warren Henry, and you don’t get that involved. I need vending ...

Whelan:    I’m in there now, Travis.

Beynon:    Yes, but it’s not turning around. You said to me the last six weeks have been tough for me, and I know for you. I don’t know how this fucking compares with losing your mother. You asked me to come to you on certain things affecting me at the moment and would like to take you up on it. What is that? Money issues, is that right? That’s all it is? Is that all it is? Is that all it is, Andrew?

Whelan:    Yes.

Beynon:    Okay. So now you don’t want to talk about it.

Whelan:    I don’t have the detail with me. You’re asking me specifics about the detail and I don’t have it with me, Travers. I’m sorry.

…

Beynon:    Well, get the numbers, then, and explain to me where you need the bonus. What about the business?

Whelan:    What do you mean?

Beynon:    You need a bonus for you. What about the business?

Whelan:    I’m not talking about this bonus. We’ve decided that. I’m asking if there’s going to be a plan for one this year. Of course I’m going to ask that question.

Beynon:    See, this is where you don’t get it. You’ve got to get this cleaned up. You’ve got to explain to me this, and then you’ve got to start to get vending back on. You’ve got to prove to me that you’re going to get the day-to-day stuff running, starting from right now. I don’t know.

    Where is it that the bonus is a – you will be broke if you don’t get the bonus is how you told it to me. You rely on ...

Whelan:    No, I never said that.

Beynon:    You rely on the bonus to survive.

Whelan:    I rely on the bonus to do what I want to do, correct, because I have in all the previous companies, Travers, over the last 10 years.

Beynon:    I don’t care what you’ve done in your previous companies ...

Whelan:    Well, I do .

(Meeting transcript page 17)

113    The thread of discussion concerning bonuses culminated in Mr Beynon saying:

…So if you’ve got to concentrate on being here, making sure that everyone’s doing their thing, and you’ve got to do vending, that’s the perfect spot. That’s the step. There are no promises for the future of bonuses and all that now. The only promise you have is – you never really ask – I never have, because I always knew I was always in control of the bonus. You don’t ask for a bonus, you’re given it. You take it by working to a point where you deserve it.

You’re asking me to predict the future without even knowing the future about whether a bonus is going to be available. No. How you get something somewhere – so it’s not even a question. If you want a fucking bonus, go and get a fucking bonus. Do you understand what I’m saying? It’s not for me to decide. That’s for you to decide. It really is. Prove yourself. Can you be the right-hand man? Let’s see how tough you really are.

(Meeting transcript page 51)

114    To the extent that I can draw inferences from the meeting transcript, I consider that, in light of the repeated and extensive discussion during that meeting of Mr Whelan’s financial position and Mr Whelan pressing for a bonus based on his previous employment, the issue of Mr Whelan asking for either a bonus or the development of a bonus plan was on Mr Beynon’s mind on 24 August 2015.

115    Second, the respondents submit that it is of critical significance that Ms Ozioko was not cross-examined about the grounds of termination. They also submit that her unchallenged evidence about her communications with Mr Beynon on 24 August 2015 explained the process of thinking, evidenced by the steps that occurred, which lead to Mr Whelan dismissal. I reject this submission. Ms Ozioko reported directly to Mr Whelan (transcript page 440 line 43). She had no authority to dismiss him, and no role in his dismissal except as directed by Mr Beynon. There is no reason for me to conclude that Ms Ozioko was a particular confidant of Mr Beynon such that he reliably and honestly informed her of his motives for taking adverse action against a staff member in the senior role that Mr Whelan occupied. There is no suggestion that Ms Ozioko advised Mr Beynon to dismiss Mr Whelan, or did anything other than what he told her to do to assist him in his dismissal of Mr Whelan.

116    Ms Ozioko’s evidence concerning her conversations with Mr Beynon is hearsay and, although I was prepared to admit it for narrative purposes, I give it little weight. It could not be tested by cross-examination of Mr Beynon, whose state of mind in deciding to dismiss Mr Whelan was critical. But in any event, even at its most favourable for the respondents’ case, the evidence of Ms Ozioko in relation to Mr Beynon’s state of mind on 24 August 2015 concerning Mr Whelan is inconclusive and unhelpful. Ms Ozioko deposed that Mr Beynon told her that his meeting with Mr Whelan “did not go well” and that although he had not terminated Mr Whelan’s employment he had impressed on Mr Whelan that he wanted his performance to immediately improve. Even accepting this evidence, one inference which could reasonably be drawn from Ms Ozioko’s evidence is that during or immediately after the meeting with Mr Whelan – in which the issues of bonuses for Mr Whelan and bonus plans were clearly a subject of both discussion and annoyance to Mr Beynon – Mr Beynon was considering dismissing Mr Whelan even though he had not terminated his employment at that point.

117    Third, the respondents mounted a detailed attack on Mr Whelan’s credibility, submitting (inter alia) that Mr Whelan had planned to resign in any event, that he was disloyal and disrespectful to Mr Beynon and mocked him behind his back, that he removed documentation from the workplace on the date of his dismissal, and that he improperly left work early on that date. In my view these issues bear little on Mr Whelan’s evidence so far as concerns his discussions with Mr Beynon concerning bonuses and bonus plans. As I have already observed, I am satisfied that Mr Whelan was anxious to the point of obsession in the months leading up to his dismissal, and on the day of his dismissal, about whether the first respondent would either pay him a bonus or develop a bonus plan. It was clear that Mr Whelan was relying on the payment of a bonus to extricate him from his financial straits. His evidence concerning this anxiety, and his interactions with Mr Beynon both prior to and on 24 August 2015 concerning bonuses, was credible.

118    Fourth, I do not accept the respondents’ claim that Mr Whelan was dismissed for gross misconduct because he had, without authorisation, sent a copy of the Zoo Magazine article and photo shoot to Ms Bouvier. I take this view because:

    Mr Whelan acknowledged the importance to the first respondent’s business of confidentiality, however he gave evidence that Mr Beynon had given him permission to send a copy of the Zoo Magazine article to Ms Stewart. This evidence is not contradicted by any substantive evidence, and I consider it plausible that Mr Beynon would not have objected to a copy of the material being sent to Ms Stewart, particularly if there was some confusion about whether the Zoo Magazine article had already been published when Mr Whelan forwarded a copy of the material to Ms Stewart.

    The only evidence the respondents advanced on this point was that of Ms Ozioko, deposing that Mr Beynon had told her there had been unauthorised disclosure to Ms Stewart, and asking her to investigate. How Mr Beynon had allegedly come by this knowledge is unknown and was not the subject of evidence or testing. Further, Ms Ozioko’s evidence concerning this issue is minimal. I consider that Ms Ozioko’s evidence on this point is of little value.

    Mr Whelan’s allegedly unauthorised provision of the article to Ms Stewart was apparently known to Ms Ozioko by early August 2015. Ms Ozioko gave evidence that she reported this information to Mr Beynon. Although it is not clear when Ms Ozioko made this report, it is logical that she would have done so immediately if it were as important as she stated in her evidence. I consider that if Mr Beynon had had concerns about Mr Whelan’s alleged conduct in respect of the ZOO Magazine article such that it warranted summary dismissal, he would have confronted Mr Whelan about this matter in early August, and certainly prior to 24 August 2015. There is no evidence that such a confrontation occurred.

    Examination of the transcript of the meeting of 24 August 2015 reveals no discussion of the Zoo Magazine article during the course of that meeting. This is consistent with Mr Whelan’s evidence that it was not bought to his attention that he had allegedly breached any confidential communication provisions of his employment contract as a result of forwarding the ZOO Magazine article to Ms Stewart until he received the letter of termination.

    Although Ms Ozioko disputed Ms Marshall’s version of events of the evening of 24 August 2015 (transcript page 384 lines 17-19, 29-34), I consider that Ms Marshall was a credible witness, and prefer her evidence in respect of the events of the evening of 24 August 2015 to that of Ms Ozioko. I take this view because Ms Marshall was an independent witness, with no convincing motive to give untruthful evidence in this respect. It was also apparent from her testimony that the events of that evening made a significant impression on her, such that she was able to recall with those events with clarity. I also consider her version of events plausible.

119    In my view, the allegedly unauthorised provision by Mr Whelan to Ms Stewart of the ZOO Magazine material was irrelevant to Mr Beynon’s decision to dismiss Mr Whelan.

120    Fifth, both in [39] of their defence and in submissions the respondents claim that the “real” grounds for terminating Mr Whelan’s employment included other matters “in the mind of Ms Ozioko and Mr Beynon” which I set out earlier in this judgment. In relation to these other matters I make the following observations.

121    What was “in the mind of Ms Ozioko” insofar as concerns Mr Whelan’s summary dismissal is irrelevant. Ms Ozioko was not the decision-maker, and could only surmise what motivated Mr Beynon to dismiss Mr Whelan.

122    The respondents claim that Mr Whelan had demonstrated lack of fidelity to Ms Ozioko in that Mr Whelan had allegedly told Mr Beynon, during the course of a business trip to Europe, to “fuck off” when in fact Mr Whelan had not done so, and when Mr Whelan subsequently lied to Mr Beynon about it. Ms Ozioko gave evidence that she understood from Mr Whelan that on 17 July 2015, Mr Beynon had remonstrated with Mr Whelan about Mr Whelan’s comments to Ms Ozioko, and what Mr Whelan had allegedly said to Mr Beynon during the Europe business trip. This incident took place five weeks before Mr Whelan was dismissed. The respondents submit that the issue of what Mr Whelan had said was raised by Mr Beynon during the meeting of 24 August 2015 and note the following exchange:

Beynon:    Be very careful with me. You’ve lost. You’ve lost my ability. You think you know me. You sat there at my place and argued about what Suzie said, what you didn’t say, and you did fucking say it.

Whelan:    I couldn’t remember saying it. I was wrong on that occasion.

(Meeting transcript page 27)

123    However, even assuming that this conversation related to the Mr Whelan’s alleged comments about Mr Beynon, as reported by Ms Ozioko – and this is not at all certain because it was not put to Mr Whelan during the trial and not tested by cross-examination of Mr Beynon – the matter appears to be of minor importance. At most, the evidence suggests that Mr Beynon took the view that Mr Whelan had been posturing to Ms Ozioko about Mr Whelan’s alleged comments to Mr Beynon during their business trip to Europe, that Mr Beynon had called him to account for it and put him in his place for saying it. It was not mentioned again by Mr Beynon during the meeting. Further, whether Ms Ozioko took the view that Mr Whelan had lied to her is not material. I am satisfied that the issue concerning whether Mr Whelan had told Ms Ozioko that he had told Mr Beynon to “fuck off” during their Europe business trip was irrelevant to Mr Beynon’s decision to dismiss Mr Whelan on 24 August 2015.

124    The respondents claimed that Mr Beynon did not trust Mr Whelan’s ability to continue to act as General Manager given Mr Whelan’s inability to manage his own financial affairs. The transcript of the discussion of 24 August 2015 certainly indicates that Mr Beynon considered that Mr Whelan was mismanaging his domestic financial affairs at that time. However the meeting ended with Mr Whelan and Mr Beynon continuing with business as usual, after Mr Beynon had told Mr Whelan to get his financial affairs in order. This suggests that Mr Beynon believed that Mr Whelan could get his financial affairs in order. If Mr Beynon formed a view at that meeting that Mr Whelan was incapable of managing the business of the first respondent and should be dismissed for that reason, it is not evident from the transcript of the meeting.

125    The respondents claimed that Mr Whelan had failed to act in a truthful way in his dealings on 24 August 2015. In addition to Mr Whelan’s alleged evasiveness concerning his having told Mr Beynon to “fuck off” while in Europe – which I have already found irrelevant in the circumstances of this case – the respondents referred to:

    Mr Whelan’s evasiveness about the reasons he was in such financial circumstances (including whether Mr Whelan had purchased a new property); and

    Mr Whelan’s evasiveness about being absent from work in July 2015 and on other days before 5.00 pm.

126    In relation to the Mr Whelan’s alleged evasiveness concerning his financial circumstances, the transcript shows that Mr Beynon pressed Mr Whelan for an explanation of why Mr Whelan was in financial straits. However, there is no evidence before me to indicate that Mr Beynon considered that Mr Whelan should be dismissed because of it – rather Mr Beynon appeared merely impatient and exasperated with Mr Whelan, and required him to get his financial affairs in order to remove the external stress on him which might affect his performance at work.

127    In relation to Mr Whelan’s alleged evasiveness concerning his alleged absences from work, from the meeting transcript Mr Beynon appeared to believe (and further appeared to be angry) that Mr Whelan had been absent from work before 5.00 pm on business days, and had been away from the office during July 2015 when both Mr Beynon and Ms Ozioko were away. In particular the respondents rely on the following exchange in the meeting transcript of 24 August 2015:

Beynon:    The only time you were out, beside the bad memory, you think that the only time you were out when my mum died that week was because of Night Owl. So I’ll find out the Night Owl appointment. If you can give me the Night Owl appointment, and I know the week my mum ...

Whelan:    Yes.

Beynon:    And you were only out for one day. I got the call, and it wasn’t – you got the Night Owl later in the week. I know the day you went to Night Owl, and that was fine, but it was prior to that that I got the shits, Andrew. I got the shits, but I was dealing with my mum, so I wasn’t going to fucking even bother about it, but I got and heard prior to that Night Owl meeting, which was another occasion. That was prior to that.

Whelan:    Travers, I don’t leave here and go and sit on a beach.

Beynon:    I don’t care. I don’t care where you go.

Whelan:    But you should, because you’re talking to me about that I was out, so there’s an issue ...

Beynon:    Andrew ...

Whelan:    ... of trust.

Beynon:    The Night Owl is one thing, but again, I shouldn’t be talking to a general manager ...

Whelan:    Correct, exactly.

Beynon    I haven’t finished. I’m dealing with my mum. I’m away. Suzie’s on holiday. Sorry, Night Owl, can I postpone it next week, there’s no one at the office. The managing director is gone, the HR operations manager is gone and I’m the only one there. I can’t leave the business. So you sitting there making fucking excuses is worse. Don’t defend yourself with something like that. It’s irresponsible because you should have gone well, I can’t leave the fucking business. The fucking cats go, the mice will fucking play.

    Do you think it’s fair that Suzie gets called on holidays? Would you be okay? Would you be okay if you got the calls when you were on holiday? I know what you’re like. You’d lose your shit if Suzie turned to you and said well, I was fucking meeting with somebody. I was away. Or should I be here? Should I be managing people? Should I be here making sure that fucking the business is run properly? I don’t think so. Because you don’t see the work I do. You think because I’m away, I don’t know what’s going on?

Whelan:    I never said that. You’re making assumptions about me.

Beynon:    I’m actually setting a point up, Andrew. You take a very long time to work me out, still. The point is you’re right, I am still fucking very much owner of the business. It doesn’t mean I have to be here. So I’m not here. Suzie’s on fucking holiday. You know that. As general manager, you should have enough fucking wits to say well, I’m not leaving. Sorry, Night Owl, can I come next week? Our major staff is away for the week. It’s just this week; she’s back next week, I can come on Monday.

    There are no excuses. Do you think that’s reasonable? You did. It happened a couple of times in the week. It wasn’t just Night Owl. Like I said. At what point are you going to say shit, I’m responsible? I don’t want Suzie bothered, because that’s not fair, because you know when I go on holidays, I expect people to fucking be responsible enough to sort the fucking shit out and have somebody there looking after the team. I don’t fucking care who, how, or why, just make sure no one fucking rings me on holidays. Would that be fair from you?

Whelan:    No, it wouldn’t.

Beynon:    That’s you speaking.

Whelan:    No, I never say that.

Beynon:    For you to believe that. Okay. Because you never speak like that. Guys, can you just make sure someone’s there, please? While I’m on holidays, I don’t want to be bothered because someone at the senior level can’t be responsible for making sure the team is under control. You would have sworn your head off, Andrew, if someone had called you on holidays because Suzie was fucking somewhere and they couldn’t get her so they had to ring you on holidays. How would you react?

Whelan:    I always get called on holidays.

Beynon:    How would you react if it was called – yeah, for particular things, but if someone called you because they couldn’t get Suzie, because she’s just left for something. I need to get this, but there’s no one around. Would you lose your shit? Maybe get a call for a big deal, for a price snap. Okay, fine, done, but to be called just for fucking no other reason than Suzie’s just fucking left and gone somewhere. She can defend oh, but I was there. I wasn’t down the beach, I was at a customer, or R&G tech, or I was there.

    Well, hang on, why didn’t you get R&G there or told Night Owl to fucking come here or can we do it next week because I cannot be another fucking person down?

(Meeting transcript page 27-30)

128    In the absence of cross-examination of Mr Beynon, however, this material is of little assistance to the respondents’ case. I am unable to form a view whether Mr Beynon was simply delivering a tirade at Mr Whelan, or whether Mr Beynon believed Mr Whelan was being evasive, or the extent to which Mr Beynon considered that Mr Whelan’s alleged conduct meant he should be dismissed. I am also not persuaded that Mr Whelan was being evasive as the respondents claim. Rather it appeared from the transcript that he was endeavouring to placate Mr Beynon. Significantly, this material was not put to Mr Whelan in cross-examination.

129    The respondents claim that Mr Whelan was dismissed because there was a prospect that Mr Whelan would imminently resign from employment with the first respondent and act contrary to its interests by disclosing confidential information. In my view this claim has no merit. There is no evidence before the Court that, when he dismissed him, Mr Beynon considered that Mr Whelan was about to resign and act to the detriment of the first respondent. Mr Whelan’s evidence was that he was prepared to continue to endure working for the first respondent because he needed the money. In my view, the evidence supports a finding to that effect.

130    The respondents claim that Mr Whelan was dismissed because he failed to comply with Mr Beynon’s oral instruction given earlier on 24 August 2015 by leaving the office before 5.00 pm, and then failing to answer or return phone calls made to his mobile phone by Mr Beynon. It is not in dispute that Mr Whelan left the office before 5.00 pm on 24 August 2015. His evidence was that he was unwell, and indeed he attended a medical clinic around 4.00 pm that day where he received a medical certificate as being unwell. As I noted earlier in this judgment, Mr Whelan gave evidence that he did not answer or return Mr Beynon’s phone calls because he was unaware of them while in the medical clinic.

131    Notwithstanding Mr Whelan’s explanation in his evidence, it does appear likely that Mr Beynon’s decision to summarily dismiss him was at least partially due to his anger at Mr Whelan’s early departure from the office on a day when Mr Beynon had specifically told him not to leave early, whether for medical consultations or otherwise. I make this observation, placing to one side the question whether dismissal of Mr Whelan for attending a medical consultation because of illness would not itself be a contravention of s 352 of the FW Act. I also consider it likely that Mr Beynon would have been angered by Mr Whelan’s failure to answer his telephone calls. This is consistent with Ms Ozioko’s evidence concerning Mr Beynon’s response when she informed him that Mr Whelan had left the office.

132    However, this conclusion does not mean that Mr Beynon’s views of Mr Whelan repeatedly inquiring about a bonus was not a substantive or operative factor in his decision.

133    The onus was on the respondents to prove that Mr Whelan’s inquiries about payment of a bonus or establishment of a bonus plan were not a substantive or operative reason for his dismissal, and I do not consider that they have discharged that onus. Taking into account the material before the Court I consider that Mr Beynon dismissed Mr Whelan because he considered Mr Whelan unreliable and his performance poor, exacerbated by repeated requests by Mr Whelan for more money by way of bonus payments or the development of a bonus plan. At the meeting on 24 August 2015, Mr Beynon had derisively dismissed Mr Whelan’s applications for bonus or a bonus plan as undeserving, and was clearly annoyed by Mr Whelan’s supplications in light of his unfavourable view of Mr Whelan’s conduct in the workplace and his perception of Mr Whelan’s mismanagement of his personal financial affairs. The meeting between Mr Beynon and Mr Whelan on 24 August 2015, where Mr Whelan again sought a bonus plan and Mr Beynon’s dismissal of Mr Whelan’s inquiries discussed in some detail, set the scene for Mr Whelan’s dismissal later that day. I consider it likely that, as far as Mr Beynon was concerned, Mr Whelan’s conduct on the afternoon of 24 August 2015 – specifically leaving early on the very day when Mr Beynon had stridently criticised Mr Whelan’s workplace performance and his allegedly frequent early departures from the workplace, and then failing to answer Mr Beynon’s telephone calls – was “the last straw” for Mr Beynon.

134    In my view, Mr Whelan has substantiated his claim against the first respondent for contravention of s 340 of the FW Act.

Was Mr Beynon involved in the contravention of s 340(1) of the FW Act?

135    Section 550 of the FW Act provides:

Involvement in contravention treated in same way as actual contravention

(1)    A person who is involved in a contravention of a civil remedy provision is taken to have contravened that provision.

Note:    If a person (the involved person) is taken under this subsection to have contravened a civil remedy provision, the involved person’s contravention may be a serious contravention (see subsection 557A(5A)). Serious contraventions attract higher maximum penalties (see subsection 539(2)).

(2)    A person is involved in a contravention of a civil remedy provision if, and only if, the person:

(a)    has aided, abetted, counselled or procured the contravention; or

(b)    has induced the contravention, whether by threats or promises or otherwise; or

(c)    has been in any way, by act or omission, directly or indirectly, knowingly concerned in or party to the contravention; or

(d)    has conspired with others to effect the contravention.

136    Section 340 of the FW Act is a civil remedy provision.

137    As the Full Court explained in Construction, Forestry, Mining and Energy Union v Director of the Fair Work Building Industry Inspectorate [2012] FCAFC 178; (2012) 209 FCR 448 at [38]:

The relevant principle to be derived from Giorgianni, Yorke v Lucas (1985) 158 CLR 661, Handlen v The Queen (2011) 245 CLR 282 at [6] and Rafferty v Madgwicks (2012) 203 FCR 1 is that the putative accessory must intentionally participate in the contravention and to form the requisite intent he must have knowledge of the essential matters which go to make up the contravention, whether or not he knows that those matters amount to a contravention. The necessary intent is absent if the person alleged to be the accessory does not know or believe that what he is assisting or encouraging is something which goes to make up the facts which constitute the contravention.

138    In Fair Work Ombudsman v Devine Marine Group Pty Ltd [2014] FCA 1365, White J set out the following principles relevant to claims of accessorial liability under s 550(1) of the FW Act:

176    Although the general principles relating to accessorial liability are settled, their application in a case such as the present is not without difficulty. In order to aid, abet, counsel or procure the relevant contravention, the person must intentionally participate in the contravention with the requisite intention: Yorke v Lucas (1984) 158 CLR 661 at 667. In order to have the requisite intention, the person must have knowledge of “the essential matters” which go to make up the events, whether or not the person knows that those matters amount to a crime: Yorke v Lucas at 667. Although it is necessary for the person to be an intentional participant and to have knowledge of the matters or things constituting the contravention, it is not necessary for the person to know those matters or things do constitute a contravention: Rural Press Ltd v Australian Competition and Consumer Commission [2002] FCAFC 213; (2002) 118 FCR 236 at [159]-[160]. That is to say, it is not necessary that the accessory should appreciate that the conduct in question is unlawful. The Full Court in Rafferty v Madgwicks [2012] FCAFC 37; (2012) 287 ALR 437 summarised the position in this respect at [254]:

[W]hile the identification of the elements of a contravention requires careful legal analysis, “[i]n order to know the essential facts, and thus satisfy s 75B(1) ... and like provisions, it is not necessary to know those facts are capable of characterisation in the language of the statute” ... This is another aspect of the longstanding principle that it is not necessary for a person to “recognise” the contravention as such, or explicitly to think about the relevant legislation that their actions may contravene ...

177    Actual, rather than imputed, knowledge is required. So much was made clear in Giorgianni v The Queen (1985) 156 CLR 473 at 506-7 by Wilson, Deane and Dawson JJ:

... [Offences of aiding and abetting and counselling and procuring] require intentional participation in a crime by lending assistance or encouragement. They do not, of course, require knowledge of the law and it is necessary to distinguish between knowledge of or belief in the existence of facts which constitute a criminal offence and knowledge or belief that those facts are made a criminal offence under the law. The necessary intent is absent if the person alleged to be a secondary participant does not know or believe that what he is assisting or encouraging is something which goes to make up the facts which constitute the commission of the relevant criminal offence. He need not recognize the criminal offence as such, but his participation must be intentionally aimed at the commission of the acts which constitute it. It is not sufficient if his knowledge or belief extends only to the possibility or even probability that the acts which he is assisting or encouraging are such, whether he realizes it or not, as to constitute the factual ingredients of a crime. If that were sufficient, a person might be guilty of aiding, abetting, counselling or procuring the commission of an offence which formed no part of his design. Intent is required and it is an intent which must be based upon knowledge or belief of the necessary facts. ...

178    The notion of being “knowingly concerned” in a contravention has a different emphasis from that of aiding, abetting, counselling or procuring” a contravention. To be knowingly concerned in a contravention, the person must have engaged in some act or conduct which “implicates or involves him or her” in the contravention so that there be a “practical connection between” the person and the contravention: Construction, Forestry, Mining and Energy Union v Clarke [2007] FCAFC 87; (2007) 164 IR 299 at [26]; Qantas Airways Ltd v Transport Workers’ Union of Australia [2011] FCA 470; (2011) 280 ALR 503 at [324]-[325].

139    The respondents rely on the following observations of Cameron FM in Fair Work Ombudsman v Centennial Financial Services Pty Ltd [2010] FMCA 863; (2010) 245 FLR 242 at [151]:

Involvement in a contravention under s.728 can only be made out if it is proved that a person has engaged in conduct specified in s.728(2). Thus, to make out involvement it is necessary to allege that a person has engaged in such conduct. In the present proceedings, the further amended statement of claim made no reference to conduct specified in s.728(2). It is also necessary to particularise which acts or set of acts constituted conduct amounting to involvement but the further amended statement of claim did not do this. Further, to form the requisite intent the respondent must have had knowledge of the essential matters which have gone to make up the contravention in question: Yorke v Lucas (1985) 158 CLR 661. Consequently, an allegation of accessorial liability requires a pleading that the accessory had actual knowledge of each and every element of the principal’s contravening conduct and an election to engage in the relevant conduct; the pleading must assert as material facts that the accessory was sufficiently aware of all the relevant facts going to the contravention: Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union (AMWU) v John Holland Pty Ltd (2009) 180 IR 350 at 359-360 [44], [45]. The further amended statement of claim did not make such allegations.

140    The respondents submit that that the third further amended statement of claim did not make relevant allegations and Mr Beynon was not called upon to answer them, as a result of which the claim must fail. They further submit that there is no evidentiary support for the proposition that Mr Beynon was liable in this category of claim.

141    I do not demur from the principles explained by the learned Federal Magistrate. It is instructive, however, to examine his Honour’s judgment further – at [152] his Honour continued:

However, as will be discussed below, in some respects this case proceeded beyond what was pleaded. Consequently, the fact that the Ombudsman’s further amended statement of claim was not pleaded or particularised as it should have been need not necessarily deprive the Court of jurisdiction or necessarily lead to a denial of procedural fairness. There is an important difference between these proceedings and Kirk v Industrial Court of New South Wales. In this case it cannot be said that all relevant alleged acts or omissions have not been identified at any point in the proceedings …

142    Mr Whelan pleads at [67] of the third further amended statement of claim that Mr Beynon was involved in the first respondent’s adverse action in contravention of s 340(1) within the meaning of s 550(2). Mr Beynon made the decision to dismiss Mr Whelan and as a result Mr Whelan was dismissed by the first respondent. Ms Ozioko gave evidence to that effect, and there is no dispute that he was the relevant decision-maker. The action of the first respondent followed the direction of Mr Beynon.

143    To paraphrase the comment of Cameron FM, it cannot be said that all relevant alleged acts or omissions have not been identified in these proceedings. Mr Beynon was an intentional participant in the factual matters which comprise the adverse action alleged against the first respondent. It must follow that, as a contravention of the Act by the first respondent has been established, Mr Beynon was directly or indirectly, knowingly concerned in, or party to, that contravention.

Claimed failure of the first respondent to pay Mr Whelan’s statutory entitlements on termination

144    Clause 1.5 of Mr Whelan’s contract of employment provides:

This contract is subject to the relevant terms of the Fair Work Act 2009 and the National Employment Standards (NES).

145    In any event, s 44(1) of the FW Act provides:

(1)    An employer must not contravene a provision of the National Employment Standards.

Note:    This subsection is a civil remedy provision (see Part 4-1).

146    The National Employment Standards (NES) are set out in Pt 2-2 of the FW Act, being minimum standards that apply to the employment of national system employees which cannot be displaced (ss 59 and 61 of the FW Act).

147    Relevant to Mr Whelan’s claim for unpaid annual leave is s 90 of the FW Act which provides:

Payment for annual leave

…

(2)    If, when the employment of an employee ends, the employee has a period of untaken paid annual leave, the employer must pay the employee the amount that would have been payable to the employee had the employee taken that period of leave.

148    In respect of his claim for salary in lieu of notice, cl 9.1 of his contract and s 117 of the FW Act are relevant. Clause 9.1 of the contract provides:

9.1    Termination by Employer

(a)    The Employer may dismiss the Employee only if the Employee has been given the following notice:

(b)    In addition to the notice in (a) above, if the Employee is 45 years old or over and has completed at least 2 years’ continuous service with the Employer, the Employee shall be entitled to an additional week’s notice.

(c)    Payment in lieu of notice shall be made in accordance with the table above when appropriate notice is not given.

Provision that employment may be terminated by part of the period of notice specified and part payment in lieu thereof.

(d)    The period of notice in this clause shall not apply in the case of dismissal for gross misconduct or other grounds that justify instant dismissal.

(Original emphasis.)

149    Section 117(2) of the FW Act provides:

Amount of notice or payment in lieu of notice

(2)    The employer must not terminate the employee’s employment unless:

(a)    the time between giving the notice and the day of the termination is at least the period (the minimum period of notice) worked out under subsection (3); or

(b)    the employer has paid to the employee (or to another person on the employee’s behalf) payment in lieu of notice of at least the amount the employer would have been liable to pay to the employee (or to another person on the employee’s behalf) at the full rate of pay for the hours the employee would have worked had the employment continued until the end of the minimum period of notice.

150    Mr Whelan claims:

    Payment in lieu of notice in the sum of $17,625.72 (calculated as three weeks being 112.5 hours at an hourly rate of $156.6731); and

    Payment for untaken but accrued annual leave in the sum of $17,160.40 (calculated as 109.53 hours at an hourly rate of $156.6731).

151    It is not in dispute that the first respondent did not pay Mr Whelan the amounts he has claimed.

152    Ms Ozioko gave the following evidence during cross-examination:

All right. Can I ask you about – as the HR manager for FreeChoice what you understood the entitlements that ought to be paid to an employee whose employment is terminated?---They were to be paid outstanding entitlements of annual leave and notice period, if they were entitled to it.

And any long service leave, if that was appropriate?---If appropriate.

Yes. And you were asked on a number of occasions, weren’t you, by Mr Whelan to work out what his statutory entitlements were. Correct?---No. Incorrect.

Can I show you a document. You recognise that document?---Yes.

That’s a document dated 26 August, two days after Mr Whelan was terminated, and he or his wife have asked you to provide the payout figure with days worked, annual leave, etcetera, broken down and what date this will be paid. Correct?---Yes.

So is it – - -?---It’s a request from his wife, yes.

You distinguished the request from his wife from a request from the employee, do you?---Yes, I do.

I see. So – all right. Do you agree with me that there was a request made by Mr Whelan’s wife for you to calculate the payout figure and the annual leave that he was entitled to?---Yes.

And he also asks there for you to arrange for his personal belongings to be returned?---Yes.

Did you ever work out his annual leave?---It was worked out at some point, yes.

Did you ever advise Mr Whelan what that annual leave entitlement was?---No, I did not.

All right. So you worked it out but you didn’t tell him?---No. That’s correct.

And you’ve not paid it to him?---That’s correct.

And you understand that any accrued leave – I will rephrase that. What amount did you work out that Mr Whelan would be entitled to regarding his annual leave?---I can’t recall the exact figure off the top of my head, but it was the annual leave amount owing to him. I believe it was a few weeks.

Around about $17,000?---Yes.

Does that ring a bell?---Give or take, yes.

And you say you calculated that amount but you haven’t paid it?---That’s correct.

Why is that?---We withheld it on the basis that Mr Whelan had our company documents and at that time we were going through the process of obtaining an Anton Piller in order to retain our company documents.

Well, that all finished on about 8 September 2015, didn’t it?---The actual execution of the order finished at that time, yes.

And all the documents were returned and there were no more outstanding documents.

Correct?---They were returned to the courts, yes.

Yes. Well, Mr Whelan doesn’t have them, does he?---Not that I’m aware of, no.

FreeChoice hasn’t gone out of business as a result of that, have they?---No.

No. So why wasn’t the accrued leave paid when it was – when it ought to have been paid upon his termination?---We did not pay them.

No, you didn’t, and I’m asking you why you didn’t?---Well, we withheld them on the basis of the confidential documents being withheld, and they were not – they were not paid after that time either.

That – - -?---We don’t have a further reason.

I beg your pardon? You don’t have a further reason?---We don’t have a further reason.

So the fact that any documents, confidential or otherwise, that were all returned back in early September 2015, that’s the only reason you say is you didn’t pay Mr Whelan his accrued leave entitlements?---That’s correct.

(Transcript pages 453-455)

153    Notwithstanding Ms Ozioko’s evidence that Mr Whelan had accrued statutory entitlements, it appears that the respondents originally considered that they were entitled to retain Mr Whelan’s termination entitlements because he had retained confidential documents of the first respondent (evidence of Ms Ozioko transcript page 454), and further because the first respondent had a cross-claim against him and considered that any amounts Mr Whelan was owed should properly be set off against the amount owing by him under the cross-claim (see, for example, submission of Mr Roney QC for the respondents at transcript page 455 lines 15-18).

154    The position of the first respondent has no merit.

155    First, s 323(1) provides that an employer must pay an employee amounts payable to the employee in relation to the performance of work in full (except as provided by s 324). Section 324(1) in turn provides:

(1)    An employer may deduct an amount from an amount payable to an employee in accordance with subsection 323(1) if:

(a)    the deduction is authorised in writing by the employee and is principally for the employee’s benefit; or

(b)    the deduction is authorised by the employee in accordance with an enterprise agreement; or

(c)    the deduction is authorised by or under a modern award or an FWC order; or

(d)    the deduction is authorised by or under a law of the Commonwealth, a State or a Territory, or an order of a court.

156    The withholding of Mr Whelan’s entitlements on the termination of his employment was not authorised under s 324(1).

157    Second, as Ms Ozioko conceded during cross-examination, issues between Mr Whelan and the first respondent concerning confidential documents have long been resolved but the first respondent continues to hold back Mr Whelan’s entitlements. I note the following evidence of Ms Ozioko:

And you say you calculated that amount but you haven’t paid it?---That’s correct.

Why is that?---We withheld it on the basis that Mr Whelan had our company documents and at that time we were going through the process of obtaining an Anton Piller in order to retain our company documents. Well, that all finished on about 8 September 2015, didn’t it?---The actual execution of the order finished at that time, yes.

And all the documents were returned and there were no more outstanding documents.

Correct?---They were returned to the courts, yes.

Yes. Well, Mr Whelan doesn’t have them, does he?---Not that I’m aware of, no.

FreeChoice hasn’t gone out of business as a result of that, have they?---No.

No. So why wasn’t the accrued leave paid when it was – when it ought to have been paid upon his termination?---We did not pay them.

(Transcript page 454 lines 22-39)

158    Third, I have already found that Mr Whelan was not dismissed for “gross misconduct” as the first respondent claimed. To that extent the provison in cl 9.1(d) of his contract of employment does not apply to entitle the first respondent to dismiss Mr Whelan without notice.

159    Fourth, I will examine the first respondent’s cross-claim later in this judgment. However the FW Act does not permit an employer to withhold statutory entitlements of this type in circumstances other than contemplated by s 324(1) of the FW Act. At the hearing the respondents submitted, in summary, that s 324(1) of the FW Act includes an entitlement to withhold where it is authorised by or under any law of the Commonwealth, a State or a Territory, amongst other things, and the respondents claim the right to withhold the payments because of a right under the general law to set off. By email dated 25 May 2017, however, Counsel for the respondents informed both the Court and the applicant that the respondents no longer pressed the submission that a set off is permitted under s 324.

160    In my view the decision to not press an allegation of a set off is appropriate, because the argument has no merit.

161    I am satisfied that Mr Whelan is entitled to these amounts claimed by him.

162    The failure of the first respondent to pay Mr Whelan his unpaid leave and salary in lieu of notice means that the first respondent has contravened s 44(1).

Was Mr Beynon involved in the first respondent’s contravention of s 44(1) of the FW Act?

163    Earlier in this judgment I set out principles relevant to accessorial liability under s 550(1) of the FW Act.

164    Mr Beynon gave no evidence concerning the first respondent’s failure to pay Mr Whelan his statutory entitlements.

165    Evidence was however given by Ms Ozioko and Ms Marshall concerning this issue during the hearing.

166    Relevantly Ms Ozioko said:

Well, we withheld them on the basis of the confidential documents being withheld, and they were not – they were not paid after that time either.

(Transcript page 454 lines 41-43)

…

MR WHITE: Yes. Was it your decision, though, Ms Ozioko, to not pay it?---Was it my decision? Yes. I was the person responsible for it.

(Transcript page 455 lines 40-41)

167    Ms Marshall gave evidence of witnessing a conversation between Mr Beynon and Ms Ozioko on the evening of 24 August 2015 after Mr Whelan had been dismissed, as follows:

And then to finish up the conversation, like, he was sort of smirking at the time after he said that, and then to finish off the conversation he was like, don’t pay him – sorry to swear, but – a fucking cent.

168    Although Ms Ozioko claims that it was her decision not to pay Mr Whelan his statutory entitlements, on the material before me I consider that Mr Beynon was knowingly involved in that conduct. Ms Ozioko referred to “we” withholding Mr Whelan’s money – I consider it implausible that Ms Ozioko would have done so in the absence of approval or indeed direction by Mr Beynon. He was the mind and will of the first respondent, and Mr Whelan was a senior officer of the first respondent. I consider it very likely that Mr Beynon would have taken the angry and vengeful approach to Mr Whelan described by Ms Marshall.