FEDERAL COURT OF AUSTRALIA

Newton v Australian Postal Corporation (No 2) [2019] FCA 2192

ORDERS

THE COURT ORDERS THAT:

1.    On or before 24 January 2020, the applicant and the first respondent:

(i)    file and serve an outline of any witness evidence dealing with the applicant’s earnings and employment circumstances post-November 2018 that the party seeks to rely upon; or in the alternative

(ii)    file a statement of agreed facts dealing with those matters; or in the further alternative

(iii)    should there be agreement on the quantum of damages and interest payable reflective of the findings made by the Court, file a minute of the orders those parties propose should be made.

2.    Subject to any further order, the proceeding be listed for further hearing on a date to be fixed in the week of 3 February 2020.

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

REASONS FOR JUDGMENT

BROMBERG J:

1    In this proceeding the applicant (“Michael Newton”) seeks various remedies against four respondents in relation to alleged contraventions of ss 340(1), 348 and 355 of the Fair Work Act 2009 (Cth) (“FW Act”). He also seeks damages with respect to alleged breaches of his contract of employment by the first respondent (“APC”).

2    The second respondent, Ahmed Fahour (“Fahour”) was, at all material times, the Managing Director and Group Chief Executive Officer (“CEO”) of APC. APC and Fahour filed a joint defence and were jointly represented. Where convenient (and appropriate) I will refer to them together as the “APC respondents”. The third respondent is the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (the “CEPU”). The fourth respondent, James (Jim) Metcher (“Metcher”), was at all material times the Branch Secretary of the New South Wales Postal and Telecommunications Branch of the CEPU and an “officer” of the CEPU within the meaning of s 12 of the FW Act.

3    On 24 March 2014, Michael Newton commenced employment at APC as its National Compensation Manager pursuant to a contract of employment executed on 13 March 2014. In that role, Michael Newton reported to Emma Blee (“Blee”), Head of Enterprise Safety, who in turn reported to Catherine Walsh (“Walsh”), General Manager, Group Executive, Human Resources and Safety. Walsh reported to Chris Blake (“Blake”), Executive General Manager, Corporate Affairs and People. Blake reported to Fahour.

4    One of Michael Newton’s key responsibilities was to drive “Project Dove” outcomes. This was weighted at 20% of his overall performance evaluation in the mid-year performance plan for the 2015/16 financial year. Project Dove was an internal project that assumed some significance in the proceedings, the status of the project and the level of executive oversight over it are matters in dispute. Broadly speaking, it was a project designed to change the way in which APC dealt with some 3,000 injured employees who were receiving workers’ compensation and not performing full duties. Project Dove was worked on by a team with members from different areas within APC and its executive sponsors were Walsh and Peter Bass (“Bass”), the General Manager, Mail Network and Postal Safety.

5    Broadly stated, the alleged contraventions of the FW Act and the contractual breaches are said to arise from two events which occurred in 2016:

(1)    when Michael Newton was removed from his position as National Compensation Manager at APC on 5 February 2016 (the “Removal decision”) and Project Dove was cancelled; and

(2)    when Michael Newton was prohibited from attending work and allegedly placed on “garden leave” on 27 April 2016 (the “Garden leave decision”).

6    Michael Newton alleges that Metcher contravened ss 348 and 355 of the FW Act on 5 February 2016 during a telephone conversation with Fahour which led to the Removal decision and the cancellation of Project Dove. It is alleged that the CEPU is liable for those contraventions by operation of ss 363 and 793 of the FW Act. It is further alleged that Fahour was “involved in” the contraventions by Metcher within the meaning of s 550 of the FW Act, and that APC is liable for these contraventions under s 793 of the FW Act.

7    Michael Newton alleges that the Removal decision was a breach of s 340(1) of the FW Act by APC. Fahour is alleged to have been “involved in” the contravention by APC within the meaning of s 550 of the FW Act.

8    Michael Newton also alleges that by the Garden leave decision APC also contravened s 340(1) of the FW Act.

9    Finally, Michael Newton alleges that the Removal decision and the Garden leave decision were in breach of his contract of employment with APC. There is no dispute that on 11 August 2016, Michael Newton was terminated from his employment with APC. Michael Newton does not contend that APC’s act of terminating his contract of employment was itself a breach of that contract. He maintains, however, that the termination of his employment contract was a “consequence” of APC’s contractual breach in giving effect to the Removal decision.

10    By way of remedy for his statutory breach claims, Michael Newton seeks orders for reinstatement, and orders for compensation and penalties. Michael Newton seeks damages for his breach of contract claims.

11    These reasons are broadly divided into two sections – the first deals with the statutory claims made by Michael Newton (other than relating to the Garden leave decision) and the second deals with his contractual claims. Many of the facts are relevant, at least by way of background, to both the statutory and the contractual claims as well as the statutory claim made in respect of the Garden leave decision. Nevertheless, given the chronological order of the most significant events, it is convenient that I record those facts primarily of relevance to the statutory claims (other than the Garden leave decision) in the first section of these reasons and likewise deal with the facts of primary relevance to the remainder of the claims in the second section of these reasons. The overlapping relevance of many of the facts recorded should not, however, be overlooked.

sections 348 and 355 claims – removal decision and cancellation of Project Dove

12    Michael Newton alleges three separate contraventions of ss 348 and 355 of the FW Act by Metcher and the CEPU. What was communicated by Metcher to Fahour when they spoke by telephone on 5 February 2016 is critical to Michael Newton’s success on these claims.

13    Michael Newton alleges that Metcher said that he would:

(1)    leak documents about “Project Dove” to the media and politicians;

(2)    arrange protest rallies about “Project Dove”;

(3)    take APC to the cleaners;

(4)    take serious industrial action; and

(5)    take legal action

unless Fahour cancelled Project Dove and removed Michael Newton from his role as National Compensation Manager.

14    The contraventions of ss 348 and 355 of the FW Act are alleged on the basis that Metcher said to Fahour that, unless Fahour cancelled Project Dove and removed Michael Newton from his position as National Compensation Manager, Metcher would carry out the threatened actions detailed above. The alleged contraventions are said to be as follows:

(1)    A contravention of s 348 by reason of Metcher making threats to take action against APC with intent to coerce APC to engage in “industrial activity”, namely, complying with a lawful request (s 347(b)(iv)) or, alternatively, an unlawful request (s 347(e)) made by the CEPU to APC for Michael Newton to be removed from his position as National Compensation Manager.

(2)    A contravention of s 355 of the FW Act by reason of Metcher threatening to take action with intent to coerce APC not to allocate to Michael Newton the duties and responsibilities or not to designate Michael Newton as having the duties and responsibilities of the role of National Compensation Manager.

(3)    A contravention of s 348 of the FW Act by reason of Metcher making threats to take action against APC with intent to coerce APC to engage in “industrial activity”, namely, complying with a lawful request (s 347(b)(iv)) made by the CEPU to APC for Project Dove to be cancelled.

15    Insofar as the CEPU is concerned, and in reliance on ss 363(1)(b) and 793(1)(a) of the FW Act, Michael Newton alleges that the actions of Metcher were the actions of the CEPU and that therefore the CEPU contravened ss 348 and 355 on each occasion that those provisions were contravened by Metcher. Insofar as APC and Fahour are concerned, and in reliance on s 550 of the FW Act, Michael Newton alleges that they were “involved in” each of Metcher’s contraventions set out above, such that they themselves are taken to have contravened those provisions.

16    Metcher and the CEPU resist any findings of any primary contraventions of ss 348 or 355 of the FW Act.

17    The APC respondents resist any findings of any contraventions of ss 348 or 355 of the FW Act on the following alternative bases:

(1)    none of the primary contraventions are made out (for a number of reasons); and

(2)    in the alternative, APC and Fahour were not “involved in” any contraventions.

Relevant Legislation and Legal Principles

18    Section 348 of the FW Act is in the following terms:

Coercion

A person must not organise or take, or threaten to organise or take, any action against another person with intent to coerce the other person, or a third person, to engage in industrial activity.

19    The phrase “engage in industrial activity” used in s 348 is defined in s 347 to include complying with a “lawful request made by, or requirement of, an industrial association” (s 347(b)(iv)) and complying with “an unlawful request made by, or requirement of, an industrial association” (s 347(e)).

20    Section 355 of the FW Act also deals with coercive conduct but is directed at protecting a person’s capacity to employ or not employ a particular person and the allocation of duties and responsibilities to a particular person. Relevantly, s 355 provides:

A person must not organise or take, or threaten to organise or take, any action against another person with intent to coerce the other person, or a third person, to:

…

(c)    allocate, or not allocate, particular duties or responsibilities to a particular employee or independent contractor; or

(d)    designate a particular employee or independent contractor as having, or not having, particular duties or responsibilities.

21    Because ss 348 and 355 are found in Pt 3-1 of the FW Act, s 361(1) can have application if it is engaged. Section 361 of the FW Act is in the following terms:

(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 that the action was, or is being, taken for that reason or with that intent, unless the person proves otherwise.

(2)    Subsection (1) does not apply in relation to orders for an interim injunction.

22    Section 361(1) creates a rebuttable presumption. The operation of s 361 was described by Kiefel CJ, Keane, Nettle and Edelman JJ in Esso Australia Pty Ltd v Australian Workers’ Union (2017) 263 CLR 551 (“Esso-HC”) at [58] as follows:

Section 361 of the Fair Work Act relevantly provides that where it is alleged that a person took action for a particular reason or with a particular intent, and taking the action for that reason or with that intent would constitute a contravention of Pt 3-1 (which includes ss 343 and 348), it is presumed that the action was taken for that reason or with that intent unless the person proves otherwise. Thus the burden of proof was on the AWU to establish the absence of coercive intent in relation to ss 343 and 348.

23    Questions arise in this proceeding as to who it is that bears the onus of proof and whether the presumption in s 361(1) of the FW Act has application and if so to which elements or ingredients of the causes of action under ss 348 and 355 of the FW Act. Whether that provision was here engaged because the pre-conditions to its engagement were satisfied is also at issue, as is a question as to whether s 361(1) has any application to conduct constituted by a threat.

24    Both ss 348 and 355 are made up of a number of elements or ingredients that need to be proved, these include both “state of mind” elements and other elements which I will call “objective elements”. In considering questions about onus of proof the starting point is that, ordinarily, the applicant bears the onus of proof for each and every element of a contravention. However, as I will explain, if s 361(1) applies and is engaged, then the onus of proof in relation to the “state of mind elements” in ss 348 and 355 is altered and it falls upon the respondent to rebut the presumption applied by s 361(1). In order to address these questions, I will first address the applicability of s 361(1) to each of the elements that make up ss 348 and 355 relevant to this proceeding. I will then separately discuss the question of the engagement of s 361(1) and its applicability to conduct constituted by a threat.

Elements of ss 348 and 355

That “action” was threatened

25    Each of ss 348 and 355 requires that it be proved that “action” was organised, taken or threatened. Relevant to this proceeding is the prohibition that a person must not “threaten to…take, any action against another person”. An issue arises as to what constitutes a threat of a kind capable of engaging ss 348 or 355 of the FW Act. The phrase “threatening to take action” appears in s 342(2) of the FW Act as part of the meaning of “adverse action”. In Fair Work Ombudsman v Australian Workers’ Union [2017] FCA 528 at [53]-[54], I surveyed the authorities on the meaning of that phrase. There is no reason, in my view, as to why the phrase “threaten to…take…action” in ss 348 and 355 should bear a different meaning. At [54] of Fair Work Ombudsman I said this:

[54]    A number of principles may be drawn from the authorities I have just outlined. First, ‘threatening to take action’ must involve the communication of a threat directed at an ascertainable person which is received or is likely to be received by that person. That a particular outcome is threatened by existing or prospective circumstances is not a threat of the requisite kind. Second, to threaten means to communicate an intent to inflict harm or, in other words, a warning of an intention to inflict harm. Third, the essence of a threat is that it is made for the purpose of intimidating a person. Accordingly, ‘threatening to take action’ must involve an expression of an intimidatory purpose. Fourth, it is not necessary that a subjective intent to carry out the threat be established. Fifth, the notion of a threat is not confined to an intent to inflict harm which was unlawful or unjustified. Sixth, the presence of malice or some other injurious motive is not a prerequisite. Lastly, a threat to take action may be conditional (in the sense that X will occur if Y does not).

26    Whether or not what was done constitutes a threat is to be determined objectively: Australian Building and Construction Commissioner v McDermott (No 2) [2018] FCA 1611 at [149] (Charlesworth J). This is an element that must be proved by the applicant and to which s 361(1) has no application.

Use of unlawful, illegitimate or unconscionable conduct

27    Both ss 348 and 355 prohibit a person from taking or threatening to take action against another person with “intent to coerce” that other person. Relevant principles as to the meaning of the phrase “intent to coerce” find their source in the legal meaning of the common law concepts of coercion and duress and are now “settled”: State of Victoria v Construction, Forestry, Mining and Energy Union (2013) 218 FCR 172 at [70], [72] (Buchanan and Griffiths JJ). The expression “intent to coerce” has been held to comprise two discrete elements. First, a state of mind element, being, the negation of choice (which I will discuss in more detail below), and second an objective element – the use of unlawful, illegitimate or unconscionable conduct. This distinction was helpfully summarised by Tracey, Reeves and Bromwich JJ in relation to s 355 and s 343(1) (which also deals with coercive conduct), in Australian Building and Construction Commissioner v Hall (2018) 261 FCR 347 at [25]:

[25]    It is well-established that the expression ‘intent to coerce’ in ss 343 and 355 carries within it a requirement to establish two discrete elements: the negation of choice; and the use of unlawful, illegitimate or unconscionable conduct to do so (see Esso Australia Pty Ltd v Australian Workers’ Union (2016) 245 FCR 39 at [174] (Buchanan J, with whom Siopis J agreed at [1])). We interpose that this conclusion and the line of authorities relied upon to reach it do not appear to have been affected by the recent High Court judgment on appeal from that judgment (see Esso Australia Pty Ltd v Australian Workers’ Union (2017) 92 ALJR 106; 350 ALR 404 at [61] (Kiefel CJ, Keane, Nettle and Edelman JJ)).

28    In relation to the objective element, the use of unlawful, illegitimate or unconscionable conduct, Allsop CJ, Collier and Rangiah JJ said the following in Auimatagi v Australian Building and Construction Commissioner [2018] FCAFC 191 at [157]-[159] (citations omitted):

[157]    The notion of unconscionability, as imposing a standard of right behaviour formed around conscience, will take its content from the values and expected conduct in an industrial setting. It is a word best understood in its practical application to real life settings where there can be an articulation and expression of why, in an employment and industrial context, the pressure sought to be exerted should be ascribed such a description of departing from right behaviour.

[158]    Although illegitimacy can be seen to be a similar conception to unconscionability as a word connoting a degree of right behaviour, illegitimacy has emerged (rightly or wrongly) as its own separate category of behaviour

    …

[159]    The notion of proportionality has been said to inform the concept of illegitimacy, in an assessment whether there is a reasonable or justifiable connection between the nature of the demand made and the nature of the pressure exerted.

29    This element is concerned with the nature of the “action” threatened, organised or taken and operates to require that that action be shown to have been unlawful, illegitimate or unconscionable. As I said in Fair Work Ombudsman at [63]-[68] and also in Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (The Bay Street Case) (2018) 260 FCR 564 at [100]-[103], this is an objective factor that must be proved by the applicant. Section 361(1) therefore has no application to this element.

30    Although not an issue put in contest, it is worth noting that in Esso-HC at [62]-[63], Kiefel CJ, Keane, Nettle and Edelman JJ (Gageler J agreeing at [65]) left open whether this requirement also includes a subjective or state of mind consideration, namely, whether the respondent “had a subjective understanding of the factual circumstances that, viewed objectively, would be seen as rendering the [‘action’] unlawful, illegitimate or unconscionable”. Relevantly to the scope of s 361(1), an issue to which I will return, their Honours noted that if that subjective understanding was necessary to be proved, s 361(1) would have application.

The actual existence of the circumstance said to be the subject of the coercive “action” organised, taken or threatened

31    A further objective element that an applicant must prove and to which s 361(1) has no application, is the factual existence of the circumstance said to be the subject of the coercive “action” organised, taken or threatened: Hall at [15]-[16]. It is far from clear, however, what the relevant circumstance or circumstances that need to be proved are. I discussed that issue at [69]-[81] of Fair Work Ombudsman. Without reaching a concluded view, I there observed that it may be necessary for an applicant to prove the factual existence, at the time that the coercive “action” was taken, of the choice or capacity which is sought to be protected by the provision in question. In the case of s 348 that choice or capacity is the ability to engage or not engage in the particular “industrial activity” which the applicant relies on. In the case of s 355 it will be one or more of the capacities enumerated at paras (a)-(d) of that provision. That is not a matter I need to consider further. Save for one reservation, it was not in contest that at the time the action here alleged was taken, the protected choices – relevantly, APC’s capacity to engage in the “industrial activity” alleged (s 348) or its capacity to allocate or not allocate particular duties or responsibilities to Michael Newton (s 355), existed. In so far as, in relation to s 348, Michael Newton relied upon the “industrial activity” specified by s 347(b)(iv) of complying with a “lawful request”, the APC respondents and the CEPU relied upon the reservation expressed in my judgment in the Bay Street Case at [82]-[85] to formally reserve their position. The same reservation was made by the APC respondents in relation to Michael Newton’s reliance upon s 347(e). I note, however, that that provision was not the subject of the view I expressed in the Bay Street Case that a “request” within the meaning of s 347(b)(iv) is to be construed as limited to a request made to associate with or participate in the activities of the industrial association that made the request.

State of mind elements

32    The state of mind elements of ss 348, 355 (and s 343) arise from the fact that a contravention of those provisions depends upon action being taken, organised or threatened with a particular state of mind. As Greenwood, Besanko and Rangiah JJ said in Australian Red Cross Society v Queensland Nurses’ Union of Employees [2019] FCAFC 215 at [75]:

one of the evident purposes of a section like s 361(1) as described by Mason J in Bowling is to place the onus of proving a mental state on the person best able to prove it, being the person whose mental state is in issue. It would be odd if the applicant bore the onus of proving part of the decision-maker’s mental state.

33    There are two components to the state of mind elements required to be proved under ss 348 and 355 (and s 343). The first goes to the respondent’s intent and the second to the respondent’s reason. Section 361(1) is applicable to each. In Construction, Forestry, Mining and Energy Union v McCorkell Constructions Pty Ltd (No 2) [2013] FCA 446 at [230] and in relation to s 343, which is relevantly in the same form, I said this:

Section 343(1) is a provision which, in the words of s 361, depends upon action taken ‘for a particular reason or with a particular intent’. The intent which s 343(1) deals with has two aspects. The first aspect is addressing the nature or character of the intent. The particular intent required is an intent to coerce. The second aspect of the requisite intent is addressing the purpose or reason of the action taken. The purpose or reason for the taking of the action must be to have the other person (or third person) do or not do one of those things specified by paragraphs (a) and (b) of s 343(1). The first aspect may be characterised as a ‘particular intent’ and the second as a ‘particular reason’ within the meaning of those terms in s 361(1).

34    On appeal, that approach to s 361(1) was left undisturbed with apparent approval: Victoria v Construction, Forestry, Mining and Energy Union at [82] (Buchanan and Griffiths JJ). In Hall (at [24]) Tracey, Reeves and Bromwich JJ expressly endorsed the reasoning in McCorkell.

35    Accordingly, to establish a contravention, both the requisite nature of the intent (an intent to negate choice) (as discussed above at [27] and see Hall at [25]-[27]) and that a reason or purpose of the action taken, organised or threatened was the engagement in “industrial activity” (for s 348) or, the engagement in the particular conduct specified by paras (a)-(d) of s 355 (for s 355), must be proved. As stated, s 361(1) is applicable.

Engaging s 361(1)

36    In order to engage s 361(1), there are two pre-conditions that need to be met.

37    First, as is stated by s 361(1)(a) itself, to engage the benefit of s 361, an applicant must make the allegation that “a person took, or is taking action for a particular reason or with a particular intent”: Celand v Sky City Adelaide Pty Ltd (2017) 256 FCR 306 at [147] (Bromberg J with whom Charlesworth J agreed at [167]); Australian Red Cross Society at [65] (Greenwood, Besanko and Rangiah JJ). In Hall (at [14]) the Full Court emphasised that the allegation “must precisely and distinctly identify the alleged reason or the alleged intent, for contravening conduct”. As discussed at [35], a contravention of ss 348 and 355 requires the respondent to have both a “particular intent” (an intent to negate choice) and a particular reason (for s 348, engagement in one or more of the industrial activities defined in s 347 and, for s 355, one or more of the matters addressed by paras (a)-(d) thereof). Both the particular intent and the particular reason will need to be precisely and distinctly conveyed in the allegation made: Hall [40]. In identifying the “particular intent” an applicant must, by the allegation made, “convey the relevant particular intent required for a contravention of [ss 348 or 355], namely an intent to negate choice”: Hall at [41]. To merely allege an “intent to coerce” may not suffice, a matter further discussed at [169] below.

38    Second, the evidence must be consistent with the hypothesis that the respondent was actuated to take the impugned action by the reason or intent alleged. I discussed the relevant authorities on that issue in Celand at [155]-[157] (Charlesworth J agreeing) and see Australian Red Cross Society at [67]-[74] (Greenwood, Besanko and Rangiah JJ). As Greenwood, Besanko and Rangiah JJ sought to emphasise by reference to the discussion in Celand, it is not necessary for the applicant to establish a prima facie connection between the alleged action and the impugned reason or intent but only that the connection is not so remote as to be fanciful.

39    A second pre-condition to the engagement of s 361(1) was referred to in Hall at [15] and at [19] where the Full Court said:

an applicant wishing to take advantage of the presumption in s 361, in addition to making the allegation in a form that meets the requirements of s 361(1)(a), must provide sufficient information about the action, and the related reason or intent (or both) for which that action was taken, to show that, in combination, they would constitute a contravention of a provision of Pt 3-1 of the FWA.

40    In my respectful view, that observation is not intended to raise a third precondition but should be understood consistently with the second pre-condition to the engagement of s 361(1) articulated in Celand and Australian Red Cross Society and the authorities there discussed.

When the rebuttal of the presumption falls to be determined

41    Lastly, as was mentioned in Hall at [18] by reference to observations made by the Full Court in Construction, Forestry, Mining and Energy Union v Anglo Coal (Dawson Services) Pty Ltd (2015) 238 FCR 273 at [27]-[28], whether the presumption in s 361(1) has been displaced falls to be determined at the end of the trial and its answer would depend on “the assessment of all of the facts by the trier of fact, including, most importantly in the conventional case, his or her assessment of the evidence given by the decision-maker acting on behalf of the [respondent]”.

Can s 361(1) apply to a threat?

42    An issue arises as to whether the reference in s 361(1) to the need to allege that “a person took, or is taking, action” extends to an allegation that action is or was threatened. The respondents assert that a threat is not “action” within the meaning of that term in s 361(1) and that therefore s 361 can have no application where the making of a threat is the conduct alleged against the respondent.

43    There is authority for the proposition that s 361(1) does not apply in relation to an alleged contravention of s 355 where the alleged conduct is a threat: Director of Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (The Red and Blue Case) [2015] FCA 1125 at [111] (Jessup J). In the Red and Blue Case and for the same reasons, Jessup J also determined that s 361(1) does not apply in relation to an alleged contravention of s 355 of the FW Act where the alleged conduct was the organising of action taken by others (at [114]). His Honour said that s 361(1) applies “only to the mental element involved in taking action. In terms, it does not apply to a threat to take action” (at [111]).

44    If that reasoning in relation to s 355 is correct, it would also apply to the other provision here in question, s 348 of the FW Act. The Red and Blue Case has been followed by a number of authorities to which I will shortly refer. There are other authorities which are inconsistent with the reasoning in the Red and Blue Case.

45    In my view, an allegation that a person made a threat or organised action is an allegation that “a person took, or is taking, action” within the meaning of that phrase in s 361(1).

46    First, on the natural meaning of the word “action” it means the “process or condition of acting or doing”: Shorter Oxford English Dictionary (6th ed, Oxford University Press, 2007) Vol 1 p 22. “Action” is a word of broad application and as White J said in Director of the Fair Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union [2015] FCA 1293 at [102] “[t]he word ‘action’ is used in s 361(1) without qualification”. Its intended broad application is confirmed by the definition of “action” in s 12 of the FW Act as including “an omission”. The term plainly extends to the act of making a threat or the act of organising someone else to do or not to do an act. To threaten or to organise is to do an act and engage in an “action” and to make an allegation that a person has made a threat or has organised others, is to allege that “a person took, or is taking action”.

47    Second, s 361(1) serves a beneficial purpose and ought not be narrowly construed. Third, if resort is to be had to the context and purpose of s 361, as Mason J explained in General Motors-Holdens Pty Ltd v Bowling (1976) 51 ALJR 235 at 241, the “plain purpose” for a reverse onus provision such as s 361 is that a respondent’s reason for engaging in the impugned conduct “lies peculiarly within his [or her] own knowledge”: see further Celand at [148], (Bromberg J) and Australian Red Cross Society at [69]-[70] and [75] (Greenwood, Besanko and Rangiah JJ). Bearing in mind its purpose, there is no discernible reason why s 361(1) should be regarded as not intended to have application to the state of mind elements required to be proved where action is organised or threatened. Further, the Explanatory Memorandum to the Fair Work Bill 2008 (Cth) at [1459]-[1461] supports the proposition that the term “action” includes threatened action. So much is expressly referred to at [1461] and the content of [1459] makes good the proposition that, when the word “conduct” used in the legislative predecessor to s 361 (s 809 of the Workplace Relations Act 1996 (Cth)) was replaced with the word “action”, there was no intention to narrow the scope of the provision: see further Director of the Fair Building Industry Inspectorate at [103] (White J).

48    The reasoning in the Red and Blue Case purports to construe the plain words of s 361(1) not by reference to s 361(1) itself, but through the prism of s 355 and the phrase “[a] person must not organise or take, or threaten to organise or take, any action”. That provision, like others to which s 361(1) has application, can provide context but the focus of the constructional exercise must be the words of s 361(1). In any event, each of the words “organise”, “take” and “threaten” used in s 355 are verbs which, like all verbs, are words which are used to describe an action. The phrase “any action” is used in s 355 to clarify the broad nature of the prohibition. It is not being used to deny that to “threaten” or to “organise” is a form of action.

49    There are a number of authorities which support the view I prefer: I have already mentioned the judgment of White J in Director of the Fair Work Building Industry Inspectorate at [101]-[104]. Although the issue was not there in contest, McCorkell is an example of a case where s 361 was applied in relation to an allegation of threatened action (see at [229]). As outlined above at [34], the approach I took in McCorkell was endorsed in Hall in a passage which expressly referred to s 361(1) having application in relation to “action…threatened to be taken”. Section 361(1) has also been applied to threatened action in Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union [2015] FCA 225 at [264]-[265] (Tracey J); Director of the Fair Work Building Industry Inspectorate v Construction, Forestry, Mining and Energy Union (No 2) [2015] FCA 199 at [100] (Mansfield J).

50    Furthermore, and with respect to Jessup J, his Honour’s approach in the Red and Blue Case is at odds with the approach that his Honour took in Esso Australia Pty Ltd v Australian Workers’ Union [2015] FCA 758 at [167] where, in relation to the organising of (and not the taking of) industrial action, Jessup J held that s 361 applied. On appeal Esso Australia Pty Ltd v The Australian Workers’ Union (2016) 245 FCR 39 (“Esso-FC”) Buchanan J (with whom Siopis J agreed) also held (at [172]-[173]) that s 361(1) applied. That approach was not disturbed in the High Court when the operation of s 361(1) was addressed in the passage set out at [22] above. The reference I have made to Esso-HC in the last sentence of [30] above, also supports the view that s 361 has application to all of the possible state of mind elements in ss 348, 343 and 355.

51    Having said all that, I appreciate that the Red and Blue Case has been followed by a number of authorities, although not necessarily in circumstances where the approach there taken was in contest: Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (The Quest Apartments Case) [2017] FCA 1398 at [70]; Australian Building and Construction Commissioner v O’Connor (No 3) [2018] FCA 43 at [128]; Australian Building and Construction Commissioner v Parker [2017] FCA 564 at [105]-[106]. In Australian Building and Construction Commissioner v Upton (The Gorgon Project Case) [2017] FCA 847 at [119], Barker J did not regard the reasoning in the Red and Blue Case as “plainly wrong”; Charlesworth J applied this reasoning in McDermott [2018] FCA 1611 at [137]-[147] with which Banks-Smith J agreed in Australian Building and Construction Commissioner v Molina (No 2) [2019] FCA 1014 at [175]. In Construction, Forestry, Mining and Energy Union v De Martin and Gasparini Pty Ltd (No 2) [2017] FCA 1046 (at [364]) Wigney J expressed reservation about the correctness of the Red and Blue Case but followed it in circumstances where its correctness was not there challenged.

52    There is, in my view, a conflict in the authorities on this issue. For the reasons stated, the better view is that s 361(1) can have application to an allegation that a person has organised or has threatened action. I will proceed on that basis.

Standard of proof

53    The respondents emphasised the gravity of the allegations made against them by Michael Newton. They characterised the allegations as allegations of unlawful conduct deliberately taken and involving intentional impropriety. They relied upon s 140(2)(c) of the Evidence Act 1995 (Cth) as embodying the principle in Briginshaw v Briginshaw (1938) 60 CLR 336 and contended that the allegations made by Michael Newton cannot be proved on the strength of “inexact proofs, indefinite testimony or indirect inferences”: Briginshaw at 362 (Dixon J).

54    I accept that any contravention of the FW Act must be “clearly established”: Bragdon v Director of the Fair Work Building Industry Inspectorate (2016) 242 FCR 46 at [45] (Buchanan, Reeves and Bromberg JJ). Nor is a finding of contravention to be lightly made: Australian Building and Construction Commissioner v Hall [2017] FCA 274 at [20] (Flick J). In Hall, the Full Court referred to the applicable standard as “the Briginshaw standard” (at [100]). However it must always be appreciated, as Jagot J helpfully observed in Fair Work Ombudsman v Maritime Union of Australia [2017] FCA 1363 at [20], that:

The standard of proof is on the balance of probabilities. Section 140(2)(c) does not alter the standard of proof in a civil matter. It speaks to the process of reasoning by which a finder of fact may be satisfied that the evidence reaches or does not reach the standard. In that process, due recognition must be given to the fact that some events are inherently more or less likely than others.

55    I have adopted that process of reasoning in carrying out the fact finding task required in relation to each of the statutory claims made by Michael Newton. Furthermore many of the facts sought to be established by Michael Newton rely on the Court drawing inferences from the evidence. In the approach to inferential fact-finding which I am bound to take, I will need to be satisfied that the circumstances appearing in the evidence give rise to reasonable and definite inferences and not merely to conflicting inferences of equal degrees of probability: Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Australian Competition and Consumer Commission (2007) 162 FCR 466 at [38] (Weinberg, Bennett and Rares JJ) citing Trustees of the Property of Cummins (a bankrupt) v Cummins (2006) 227 CLR 278 at [34] (Gleeson CJ, Gummow, Hayne, Heydon and Crennan JJ).

Admitted Allegations

56    I will shortly refer to the pleadings and, in particular, to allegations made by Michael Newton that were admitted in the Amended Defence of the APC respondents but not admitted by Metcher or the CEPU.

57    It is not in contest that Michael Newton is, as against the APC respondents, entitled to rely upon the allegations admitted by those parties. The admitted allegations concern factual matters and the effect of the admissions is to put the facts alleged out of dispute. A court is not bound to act on admissions (Australian Competition and Consumer Commission v Leahy Petroleum Pty Ltd (2007) 160 FCR 321 at [42] and [49], Gray J), but in the absence of any contention to the contrary, I intend to treat the factual allegations admitted by the APC respondents as binding and as establishing against them the existence of those facts.

58    However, it is necessary to observe that the allegations admitted by the APC respondents are not received as evidence. Particularly where, as here, pleadings are not required to be directly verified by the party on whose behalf they are made, admitted allegations are not to be treated as though they are evidentiary admissions made by the party making a pleadings admission: Laws v Australian Broadcasting Tribunal (1990) 170 CLR 70 at 86 (Mason CJ and Brennan J). That the allegations admitted by the APC respondents through their pleadings should be treated as evidentiary admissions was the premise upon which Michael Newton contended that, in the context of the conduct of “several trials that have been joined”, the admissions made by the APC respondents can also be relied upon by Michael Newton as against Metcher and the CEPU. That submission must be rejected.

59    That contention is rejected because, first as already stated, pleadings admissions are not evidentiary admissions even against the party whose pleadings contain the admission. Second and by analogy, in the absence of consent, even evidentiary admissions are not admissible as against a party to the proceeding where the admission is made by evidence adduced by another party: s 83 of the Evidence Act. Third, Michael Newton’s reliance on the conduct of a joint trial is misplaced A joint trial involving multiple respondents is not one trial but several trials in which, putting aside exceptions not presently relevant, admissions made in the trial of one respondent are not admissible as evidence in the trial of another. For an example of the application of that principle see R v Cornelissen [2004] NSWCCA 449 at [110]-[115] (James J, with whom Hidden and Bell JJ agreed).

The Pleadings and the Admitted Allegations

60    Before referring to the evidence, it is both necessary and convenient to set out the critical conversation between Metcher and Fahour on 5 February 2016 as pleaded in Michael Newton’s Second Further Amended Statement of Claim (“SFASoC”) and as dealt with in the Amended Defence of the APC respondents. Michael Newton pleaded that:

41.    On 5 February 2016, Metcher spoke to Fahour by telephone. During the conversation, Metcher told Fahour that:

a.    Metcher had in his possession leaked APC documents about ‘Project Dove’ (APC documents);

   b.    He was opposed to APC’ s implementation of ‘Project Dove’; and

   c.     He could not work with [Michael Newton] any more.

41A.     By telling Fahour that he could not work with [Michael Newton] any more, Metcher was in effect demanding that [Michael Newton] be removed from his role as National Compensation Manager.

41B     When Fahour was told by Metcher that he (Metcher) could not work with [Michael Newton] any more, Fahour understood that this was in effect a demand by Metcher that [Michael Newton] be removed from his role as National Compensation Manager.

42.    During the conversation, Metcher also said that he would:

a.    leak the APC documents to the media and politicians;

b.    arrange protest rallies about ‘Project Dove’;

c.    take [APC] to the cleaners;

d.    take serious industrial action; and

e.     take legal action.

unless Fahour:

    i.    cancelled Project Dove; and

ii.    removed [Michael Newton] from his position as National Compensation Manager.

43.    Fahour agreed with Metcher that APC would:

   a.    cancel ‘Project Dove’; and

b.    remove [Michael Newton] from his position as National Compensation Manager.

Particulars

The agreement was made orally on 5 February 2016 during a telephone conversation between Metcher and Fahour.

61    The APC respondents jointly filed an Amended Defence. They admitted para 41 of the SFASoC subject to disputing that Metcher described the slides in his possession as “leaked”. Importantly, the APC respondents admit that Metcher told Fahour that he could not work with Michael Newton anymore. However, in answer to para 41A of the SFASoC, APC and Fahour deny that by saying that he could not work with Michael Newton, Metcher was in effect demanding that Michael Newton be removed from his role as National Compensation Manager. They also deny para 41B of the SFASoC that, from the statement made by Metcher that he could not work with Michael Newton, Fahour understood that the demand was made. They say that the alleged demand was not made either expressly or impliedly.

62    The alleged threatened actions are the subject of para 42 of the SFASoC. The APC respondents admit the content of the statements alleged by Michael Newton to constitute the “threats”, but say that those words were not said in the context of Metcher asking, requesting or requiring of Fahour that Michael Newton be removed from his position as National Compensation Manager. In so far as they admit that the threats were conditional upon APC taking any action, the APC respondents only admit that they were conditional upon Fahour cancelling Project Dove.

63    The APC respondents denied the allegations in para 43 of the SFASoC that Fahour agreed with Metcher that APC would cancel Project Dove and remove Michael Newton from his position as National Compensation Manager.

64    Further in pleading Fahour’s reason for removing Michael Newton from his position as National Compensation Manager, the APC respondents say that during the course of the phone call on 5 February 2016, Metcher said to Fahour words to the effect that “[Michael Newton] had a personal zealotry to hurt injured workers the subject of Project Dove and that [Metcher] was angry with [Michael Newton]” and “that [Michael Newton] was the cause of problems that [Metcher] perceived with [APC’s] workers’ compensation function”. The pleadings of the APC respondents also state that during the phone call, Metcher expressed anger and volatility, including specifically towards Michael Newton.

The Facts

65    The only direct evidence of the conversation on 5 February 2016 between Fahour and Metcher was given by Fahour. Metcher was not called. At the time that he gave his evidence, Fahour was no longer employed by APC and was working as the Managing Director and CEO of a financial services company.

66    Fahour first commenced employment with APC in February 2010 in the role of Managing Director and CEO. That was the role he held at the time of the conversation with Metcher. Before dealing with the conversation itself, there are some background matters that Fahour and others gave evidence about which provide a relevant context.

67    APC utilised over 50,000 direct and indirect employees. It had, at the time, a 4 level management structure with about 10 people on an executive committee and a second layer of 30-40 managers at a management committee level. Walsh was at that level. There was a third level, the “senior leadership team” of about 200 managers, followed by a fourth level of some 1,000 managers. Michael Newton was at that fourth level. Whilst Fahour had regular contact with Walsh, he had no prior contact with or knowledge of Michael Newton before 5 February 2016.

68    Fahour deposed that in late 2013/early 2014, APC began to develop a reform program (“APC reform program”) designed to save thousands of jobs and APC’s business from looming significant financial loss. The APC reform program was designed to transform APC from being a letter delivery company to a parcel delivery company. It was described by Fahour as the largest reform in APC’s history. The Commonwealth Parliament approved the APC reform program in late 2015 and the implementation of those reforms began in January 2016.

69    Of the 30,000 or so employees directly employed by APC, Fahour deposed of his understanding that around 22,000 were members of the CEPU. The primary contact with the CEPU was through its National Secretary but contact on State-based issues occurred with other officials. In relation to New South Wales, where the largest number of employees of APC resided, the contact for him and APC was largely with Metcher.

70    Fahour described his understanding of Metcher as someone who had a very long history in the CEPU. He said that what struck him most about Metcher when he met him was that he almost had an obsession with the everyday employee, those at the bottom of the income pile, for whom he felt a special connection. Fahour considered that he had very professional dealings throughout most of the time he interacted with Metcher until the APC reform program began, when Metcher seemed concerned about how management was going about the path of reform. He described Metcher as “cynical”.

71    Fahour also felt that something happened in 2015 to Metcher which changed the nature of his interaction with APC. A number of communications were made by Metcher on “regular issues” in which Metcher seemed quite antagonistic and quite agitated. In about mid-2015, Fahour was notified by the National Secretary of the CEPU that he would no longer deal with Metcher who was taking a leave of absence and Metcher “disappeared” for the second half of 2015. Fahour’s understanding of that absence was described by him as “a medical absence” which he later suggested was mental health related.

72    Fahour deposed that in late January 2016 he was conscious that pretty serious accusations were being made by Metcher about APC failing in its workers’ compensation unit. He was conscious of various communications forwarded by Metcher on the issue. Metcher became particularly involved in the case of Ms Leanne White (“White”), which he viewed as a “primary case study to what [was] occurring within the [APC] workers’ compensation department in how claims are being managed”.

73    From 22 January 2016 to 3 February 2016 email correspondence ensued between Metcher and senior executives at APC, including Walsh, in relation to alleged defects in APC’s workers’ compensation system, and concerns relating to White’s case. In that correspondence Metcher repeated an intention to publicly expose APC “in Canberra” in relation to those concerns and also the CEPU’s intention to commence legal proceedings.

74    It is in the context of this communication that Fahour emailed Walsh on 3 February 2016 at 9.16am requesting that she get together with Blake, Nick Macdonald, General Counsel and General Manager, Assurance (Corporate Centre) (“Macdonald”), Darryl Newton, Chief Risk Officer (“Darryl Newton”), Paul Burke, Corporate Secretary and General Manager, Government Affairs (“Burke”), Blee and Laz Cotsios, Group Executive, Business Services and “lay out the allegations” made by Metcher and propose a “very quick review”.

75    The communication emphasised the urgency of the matter, requiring the review to “begin on Friday (very important that it is documented as beginning this Friday)”. It stated that the questions “we need answered in the next 4 weeks” include the allegations made about workers’ compensation and payments, the current process for handling claims and any improvements that can be made, whether there is any basis in the White case and also the best process “to handle Union escalation and deal with issues…distracting the whole Organisation”. This “quick review” became what I will refer to as the “Leanne White Review”.

76    Although chronologically out of order, it is desirable to here set out the conduct and findings of the Leanne White Review.

77    The Leanne White Review was carried out by Darryl Newton, who chaired the committee and had management accountability for the performance of the Review, Roger Sweet, Senior Manager, Internal Audit, BRM Risk Management, an external audit firm, and Tim Lyon (“Lyon”), former Assistant Secretary of the Australian Council of Trade Unions (“ACTU”), who was engaged as an independent reviewer.

78    The review was to investigate two matters: first, the conduct of White’s workers’ compensation case, and second, to consider the management activities of the workers’ compensation unit. The review involved conducting interviews with ten APC personnel, including Blee and Michael Newton, interviews with White and Metcher, and the review of over 100 documents and over 200 emails. The final report was released on 20 April 2016 and was provided to a broader group of people, including Fahour, Metcher, Lyon and Michael Newton.

79    The report found that the management of her claim resulted in a “poor experience” for White and that she had experienced delays and errors, some of which resulted in “technical non-compliance with procedural requirements under the [Safety, Rehabilitation and Compensation Act 1988 (Cth)]”, however none of which constituted a breach of that Act. The review found that all payments had been made to White and her sick and annual leave balances were correct and that there had in fact been a minor overpayment.

80    The report noted that the manner in which concerns had been raised by the CEPU “has often not been conducive to their resolution”, and that the “volume, tone, timing and escalation of communications, along with demands for sometimes unreasonable timeframes for responses and regular threats of external action has hindered the ability for the claim to be effectively managed”. The report further stated that this had also resulted in “significant negative personal impacts” to some APC staff.

81    Returning to events of 3 February 2016, Fahour agreed that he called for the Leanne White Review, in part, because Metcher was “ratcheting up his concerns” by raising his allegations with other union officials. Fahour said that he was concerned about the escalation of the issue and, in circumstances where APC was seeking to implement the APC reform program, the issue represented a “significant distraction”. Fahour considered that APC may learn something from studying White’s case to see if there were any wider implications.

82    Fahour’s decision to have a review of workers’ compensation practices occurred in the context that Fahour was aware that, before he joined APC and in 2009, APC’s injury management unit and workers’ compensation system was the subject of a Parliamentary review by the Senate. He described his understanding that that review had been preceded by a one-year campaign (presumably by the CEPU) which had made claims about failures in the way APC managed workers’ compensation. He said that APC had agreed “to a bunch of undertakings” in relation to the Parliamentary review. In that context and in January 2016, when allegations made by Metcher of failures in APC’s workers’ compensation unit were being received, Fahour deposed that he and Walsh were “concerned deeply” because APC had just received approval from the Senate for the APC reform program. Fahour said this:

And, of course, in the back of my mind, I was deeply concerned about that, so what then I tried to do, without making this thing bigger than Ben Hur, rather than boiling the ocean, as such – what I suggested to [Walsh] is this Leanne White case seems to be becoming much bigger than what it really seems, but maybe we can learn something from that case by studying it to see if there’s any wider implications. So we had developed, over time, this terms of reference to have a short, sharp review so that when I did face the Senate, I was in a position to be able to respond to the allegations if they were the case.

83    Earlier in his evidence, Fahour deposed that he had anticipated that the allegations that were being made by Metcher might find their way into the Senate estimates program and that he had suggested that APC had three or four weeks to prepare an answer to the allegations that he contemplated may be raised. That was a motivation for conducting the Leanne White Review and appears to have been the motivation for Fahour requiring, in his 3 February 2016 email, that the review be conducted urgently with answers “in the next four weeks”.

84    At 9.29am on 4 February 2016 Metcher sent a further email to Walsh, this time copying in Fahour, in relation to White’s case. In that email Metcher stated that he intended to present White and other sick and injured APC workers as examples of how APC treats its sick and injured workers and manages their claims, when in Canberra on the following Monday and Tuesday.

85    Later, on 4 February 2016, Metcher attended a meeting of the APC Workers’ Compensation Reform Forum via phone link from Sydney. Blee and Michael Newton were in attendance. It was at this meeting that Metcher informed Michael Newton that he was in possession of Project Dove documents. Michael Newton deposed that he told Metcher that he was happy to coordinate another meeting to discuss Project Dove to which Metcher laughed down the phone. Michael Newton deposed that Metcher’s comments caused a “flurry of activity” and a “sense of panic” at APC.

86    At 9.03am on 5 February 2016, Walsh sent an email to Metcher detailing how APC was taking proactive steps to address the complaints that he had been making regarding White, and noting that Metcher’s complaints about White and the workers’ compensation system generally were being taken seriously. In response to the email, at 10.48am Metcher emailed Walsh (copied to Fahour) stating that APC management and himself were “embroiled in a bitter brawl” over APC’s workers’ compensation management systems. He concluded the lengthy email by stating that “Operation Dove” had been leaked to him, and that Michael Newton had confirmed to him that it existed, and further “this is all I needed to know to what is occurring with the present [workers’ compensation] strategy and attack on sick and injured workers by [APC].” Metcher concluded the email with a threat of exposing APC. Fahour deposed that he hadn’t read this email.

87    At 11.54am on 5 February 2016 Fahour sent Metcher a letter attaching an explanation about the Leanne White Review and its Terms of Reference.

88    At 12.32pm, less than an hour after Fahour sent his letter to Metcher, Metcher emailed Fahour. He expressed his disappointment that the proposed Leanne White Review was only an internal review, during which “life goes on as normal”. He then added the following line:

In addition - Michael Newton’s ‘Operation Dove’!

Got to be kidding me.

89    The email was signed off by Metcher with: “Return to Sender”.

90    Fahour deposed that he read that email sometime between 12.32 and 2.17pm on the day it was sent. When he read it, he did not know who Michael Newton was. Nor did he know what “Operation Dove” was. He said that, at that time, he had never heard of “Operation Dove”.

91    At 2:17pm on 5 February 2016 Fahour forwarded the email he had received from Metcher to Walsh asking her “Who is Michael Newton and what is Operation Dove?”

92    Later that afternoon, and before Walsh had responded to Fahour, Metcher and Fahour spoke by phone. The call took place at some time between 2.17pm and 5pm.

93    Before recounting the evidence of the critical conversation between Fahour and Metcher on 5 February 2016, it is convenient that I express my reservations about the reliability of the evidence given by Fahour. In particular, those concerns attend the evidence Fahour gave about that critical conversation as well as the conversation Fahour later had with Walsh and the evidence given by Fahour as to what motivated the actions he took on 5 February 2016, including his decision to remove Michael Newton from his position.

94    In assessing the reliability of the evidence given, including that of Fahour, I have had regard to the following considerations conveniently collected by Wigney J in Rush v Nationwide News Pty Ltd (No 7) [2019] FCA 496 at [307]-[309]:

[307]    Witness demeanour is one consideration which may assist a judge to resolve conflicting evidence.  Sometimes the demeanour of a witness while giving evidence about contentious issues may provide insight into whether the evidence given by the witness is either honest and reliable, or dishonest or unreliable.  Signs that may indicate dishonesty or unreliability include evasiveness, nervousness, an apparent unwillingness on the part of the witness to make appropriate or obvious concessions and even, in some circumstances, overconfidence.  

[308]    Even where a witness displays such traits when giving evidence, however, some caution must generally be exercised.  That is because a witness may, for example, appear nervous or evasive for reasons that have nothing whatsoever to do with the honesty or reliability of their evidence.  Other witnesses may be able to give evidence in an appropriately confident and direct manner and yet their evidence may be found to have been unreliable or, worse still, dishonest.  Witness reliability is not always a reliable signpost.  Indeed, judges have often cautioned against the dangers of too readily drawing conclusions about truthfulness and reliability based solely or mainly on the appearance of witnesses.  Scientific research has also cast doubt on the ability of judges to tell truth from falsehood accurately on the basis of such appearances: see Fox v Percy (2003) 214 CLR 118 at [30]-[31] and the cases there cited.

[309]    Aside from demeanour, there are other factors or considerations which may assist a judge in determining the credibility of a witness and the reliability of his or her evidence. Those considerations include: whether the witness has previously given an account of the events in question and, if so, whether that previous account is consistent or inconsistent with the evidence given by the witness; the plausibility and apparent logic of the events described by the witness; and the consistency of the account of the events described as compared with other objectively established events. Such considerations often turn out to be a much surer guide to the reliability of the evidence given by a witness about disputed events. As Atkin LJ observed in Société d’Avances Commerciales (Société Anonyme Egyptienne) v Merchants’ Marine Insurance Co (The ‘Palitana’) (1924) 20 Ll L Rep 140 at 152; cited in Fox v Percy at [30]:

… I think that an ounce of intrinsic merit or demerit in the evidence, that is to say, the value of the comparison of evidence with known facts, is worth pounds of demeanour.

95    The events Fahour gave evidence of occurred some two and three quarter years prior to him giving that evidence. It would be understandable if the detail of what was said and the detail of Fahour’s reactions and his own thought processes were lost or diminished by time. That is particularly so given that Fahour was a very busy CEO of a very large corporation and, it may be assumed, most of the events in question were not of much significance to a person in that position at the time they occurred. But my concern with Fahour’s evidence is not about any professed inability to recall the detail. To the contrary, most of Fahour’s evidence on these matters was given by a person who gave the impression that he mostly had very good recall. However, the evidence was so plagued with implausibility and contradictions, including that the same events were described differently from one day to the next, that it was clear to me that the detail of these events was often being reconstructed rather than being accurately recalled. Many of the inconsistencies are recorded in the submissions made by Michael Newton. I refer to some of those inconsistencies below. As will also be apparent shortly, there were direct and substantial inconsistencies between Fahour’s pleaded case and the evidence he gave about his critical conversation with Metcher on 5 February 2016. I have reached my view about the reliability of Fahour’s evidence without the need to rely on those inconsistencies. I accept, however, that in the absence of any attempt made to explain those inconsistencies (including, if it were relevant, some explanation as to why an explanation could not be given), Michael Newton was entitled to rely on those inconsistencies to impugn the reliability of Fahour’s evidence.

96    In my view, the evidence given by Fahour was peppered with speculative and often self-serving reconstructions of the detail of conversations and motivations, many of which are critical to the issues I need to determine. I do not reject all of Fahour’s evidence. Some of it I accept as reliable. To some extent documentary corroboration has assisted. In other respects, I have regarded some of the evidence as plausible. I have used the apparent logic of events as a strong guiding consideration in assessing the reliability of Fahour’s evidence. My general approach has been to only accept Fahour’s evidence where it is corroborated by other evidence or is sufficiently consistent with objectively established events for me to regard the evidence as plausible.

97    The references to the evidence which Fahour gave which now follow are not intended to necessarily suggest my acceptance of that evidence. So much of Fahour’s evidence which I do accept, and which is necessary for me to make findings about, will be set out later in these reasons.

98    Fahour’s evidence was that he was sitting in his car on the afternoon of 5 February 2016, possibly in Sydney, when he participated in the call with Metcher. He was not sure who called whom and he did not know how long the call lasted. His evidence was that White and the proposed Leanne White Review, Project Dove, Michael Newton and the APC reform process were all discussed. Fahour deposed that the majority of the conversation was about “the workers’ compensation system”. He said that Metcher was obsessively concerned about what he perceived to be the injustice in relation to White. Fahour then said that towards the back end of the call the conversation turned to Project Dove and Michael Newton. Given the importance of the conversation it is best that the account given in chief by Fahour be set out largely in full. For ease of reference I have emphasised some elements I consider to be most significant:

he – he raised once again – he said – and really he said, ‘You know, [Fahour], you know, you’ve gotten through the Parliament this reform program of yours and you’ve made all these promises about saving people’s jobs and it’s all about, you know, transferring them over and that’s what your intention – that you told them was, but here you are in the background working out how you’re going to hurt the most vulnerable of your employees and our members and those that are injured.’ And I said, ‘What are you talking about?’ He said, ‘Operation Dove.’ And I said – I said, ‘Is this a joke? What is Operation Dove?’ He said, ‘You know what it is.’ I said, ‘I have no clue. I haven’t heard what it is. You know, I – I tried to get hold of [Walsh] to find out and I have not been able to get an answer. So what are you talking about?’

And what did he say?---Well, he said, ‘You’re – I’ve got some slides and it shows that you’re planning, through this operation, to fire 3000 or so people so that you can save a tonne of money and you think by saving that money, you’re going to save [APC] but you’re going to do it on the back of the most vulnerable, injured, hurt people in the company. These are the posties, the staff members.’ He – and – and he said some, you know, some words against me.

Doing the best you can, what can you remember the words – about the words he used and what he said?---Well, when – when Mr Metcher is angry, his language can be quite vile and he was upset because he thought – he thought, and I might say completely wrongly, that I was somehow secretly plotting behind the scenes to – to – to fire the people that I have spent five years working on to help and support and to take care of. And he – he – he then said words to the effect, ‘You know, do you not have any morals? Do you have any values? How could you do this to these people? These are – these have given their heart and soul to the company and look what you’re doing to them’, blah, blah, blah, blah, blah. And then the first time, you know, he mentioned any other name – then he said – then the next person he went after was Catherine Walsh and he said, ‘I’ve worked with her for all these years and I can’t believe that she’s turning her back, as the head of HR, on these injured people.’

And did he mention anyone else from [APC]?---He mentioned very much in passing – and he said something to the effect, ‘And your henchman,’ something – some word to that effect, ‘Michael Newton’s doing all your dirty work for you in this analysis that I’ve got here or in these spreadsheets that I’ve got here or these slides,’ or something to that effect.

And did you say anything in response to that?---I said, ‘How can I have somebody doing my dirty work for me in the background when I don’t even know who he is?’ He said, ‘You know who he is. He’s done all this work for you.’

And I said, ‘I don’t.’ And then because he could see that I actually [sic] no answer, he then went back at that point to accusing [Walsh] and I of all sorts of accusations that, quite frankly, are a bit unfair and, well, that are wrong, but just not very nice.

Again, what can you recall about the words he used in making any accusations?---He was just really, really angry that we were lying, that we were deceiving the Australian people about our true intention of how we were going to save [APC]. He thought that we were going to fire and hurt the livelihoods of all these injured people who were the most vulnerable. He – he was deeply and emotionally – beyond anything I’ve ever seen in my life felt that he was the last man standing to take care of these 3000 people. And I said to him, ‘[Metcher], I remind you these are my staff and I don’t need you to tell me this point. I will take care of my own people.’

Can you recall anything else that he said during the call, anything else that you said to him?---I raised several times an opportunity to do this – this – the – a more thorough review about how we can do this, about how we can tackle the Workers’ Compensation review. And then, he said to me along the lines, you know, you –‘You’re about to launch this Operation Dove and I’m going to make sure that I expose you and all your staff for what you’re about to do.’ And I said to him, ‘I think you’re exaggerating, and there’s nothing going to occur about this because I don’t know anything about it.’ So he was very focused on – he thought there was something imminent that he had stumbled upon that we were about to do, and he couldn’t be further from the truth.

99    Fahour was reminded by his Counsel about the evidence he had given that Metcher’s language can be vile and was asked whether there was any swearing during the phone call. Fahour confirmed that there was. He then gave the following evidence about Metcher’s language and how the call ended (emphasis added):

Well, you see, he – he was really, you know, you fucking bastards, you have – you’re going to fuck these people over, and how fucking dare you, you know, treat injured people this way, you know. They’re – they’re hurt. They’re at home and they can’t pay their mortgages. You’re going to fucking ruin their lives. You’re going to – you’re – you’re going to send people to, you know, suicide and things like that. And it – it really – the language was one thing, but it was quite emotionally distressing. Really emotionally distressing actually.

100    Despite the admission made in his pleading, Fahour denied that Metcher had made a demand that he shut down or cancel Project Dove, or said anything that he interpreted as a demand made by Metcher that he shut down or cancel Project Dove. Fahour denied that he had agreed with Metcher that he would shut down or cancel Project Dove. He was also asked by his Counsel whether, during the phone call, Metcher had demanded that he remove Michael Newton from his position or from the workers’ compensation unit or whether Metcher had said anything which he had interpreted as being a demand to that effect. Fahour denied that such a demand had been made or that so much was suggested by what Metcher had said. He also denied that he agreed with Metcher that he would remove Michael Newton from his position or from the worker’s compensation unit. He added that one of the statements made by Metcher was something along the lines of “I don’t give a fuck what you do, you do what you do and I will do my job”.

101    Although not mentioned by Fahour in the initial account of the conversation given by him in chief and set out above, in cross-examination, Fahour agreed that during the conversation Metcher had made a number of “threats”. Fahour deposed that Metcher said that he would do certain things, that he had uncovered this conspiracy and that he was going to stop it. One of the “threats” made by Metcher was that he would organise protest rallies. Metcher also threatened industrial action. Fahour thought that Metcher was referring to the taking of “legal” industrial action that APC could not stop. He agreed, however, that it was most likely that all that Metcher said were words to the effect “we are going to take industrial action”. Based on that threat about industrial action, Fahour came to the view that there was “an impending disaster looming from an industrial point of view”. Another threat raised by Metcher was publicity that could be instigated – publicity about Project Dove. This threat made Fahour concerned that Metcher would spread misinformation about the APC reform program. Metcher also raised, as another threat, instigating legal action against APC. Fahour said that Metcher mentioned “some legal threats, because he seemed to have some information that could prove that we had breached the Act”.

102    Later in his cross-examination (on the next day of the trial) Fahour sought to deny that Metcher had uttered any “threats” saying that Metcher “did offer a number of actions that he would take”. Despite having himself used the word “threat” several times on the previous day, Fahour disagreed with that characterisation on the basis that a threat meant “if you don’t do A, I am going to do B”, whereas he deposed that what Metcher was saying was “I don’t care what you do”. Fahour insisted that Metcher had said he would do a number of things “anyway”, irrespective of whatever Fahour did.

103    In cross-examination, Fahour described Metcher as having got “extremely emotional” during the conversation. Metcher accused Fahour of lying and got “quite verbal. The language really escalated”. Fahour described Metcher as being absolutely convinced that he and Walsh and the management team “were up to some big, massive program to fire 3,000 people”. To Fahour’s protestations that Metcher was wrong and that there was no conspiracy, no secret plan, Metcher said “I’ve got slides”. Fahour described the issue that Metcher “got most distressed about” was that he thought that Fahour and his team were working to fire 3,000 people. It was then that Metcher “got emotional and his voice really elevated. And he used some language which was quite profane”.

104    Fahour agreed that Metcher had expressed very strong negative views about Project Dove and when asked whether it was clear to him that Metcher didn’t want Project Dove to proceed, Fahour said “[h]e didn’t tell me that. But I can assume that that’s something he wouldn’t want done.”

105    When it was later suggested to Fahour that Metcher’s focus was on Project Dove, Fahour said that his focus was “on exposing me and [APC]…that we were doing something – breaching the Act”. Fahour said that Metcher had some legal action that he was going to take to expose APC and that he was going to organise political rallies against APC. Fahour accepted that Project Dove was part of the focus but stated that the mismanagement of White’s case as well as Metcher’s view that the APC reform program “was flawed and not true” was also at the heart of the discussion.

106    Fahour confirmed that Michael Newton was mentioned during the conversation. He was reminded of his evidence that Metcher had referred to Michael Newton as “your henchman”. Fahour was asked what he understood by that. He said “I just assumed he meant he was the guy doing my dirty work” and that the “dirty work” was the secret plan to sack 3,000 employees.

107    Fahour denied that Metcher had said he would do “those things”, unless Fahour cancelled Project Dove or unless Fahour removed Michael Newton from his position as National Compensation Manager. Fahour also denied that Metcher had said during the conversation, that he considered Michael Newton to be the cause of the problems with APC’s workers’ compensation system.

108    Despite the admission made by his pleading, when asked whether Metcher had raised during the course of the telephone call that he could not work with Michael Newton anymore, Fahour said “I don’t recall him saying those words”. To the suggestion that Metcher had said words to the effect that his working relationship with Michael Newton had broken down, Fahour said “No, he didn’t say it like that”. When asked if Metcher had said anything about whether he was prepared to continue working for Michael Newton, Fahour said that what Metcher said about Michael Newton was that he was “your henchman”. Fahour stated that Metcher described Michael Newton as one of Fahour’s underlings out there doing his dirty work for him, trying to fire 3,000 injured workers. Fahour also denied that Metcher expressed any dislike for Michael Newton.

109    There was evidence of Fahour’s reaction to his conversation with Metcher and the actions he took in response to it. Fahour deposed that once he was able to compose himself after the conversation with Metcher, he sat in his car and thought through “how do I avoid what seemed to be an impending disaster looming from an industrial point of view”. He said that he was concerned that Metcher was going to use a political rally, and that there was a political meeting of some sort in the lead up to “the Senate that was going to derail the reform”. By that, I understand Fahour to be referring to committee hearings held as part of the Senate estimates process which he feared would be used to derail the APC reform program. He also said that he had “the industrial actions looming” and that he thought about how “do I get this [workers’ compensation] review done”. He said that he then called Walsh.

110    Fahour deposed that he told Walsh of his conversation with Metcher. He paused to ask her “who is Michael Newton?” To that, Fahour said that Walsh described Michael Newton as a mid to lower-level manager who works in the workers’ compensation unit. Fahour deposed that he then mentioned that Metcher had said something about Operation Dove and the firing of 3,000 injured workers and asked Walsh what all that was about, to which Walsh replied “its some desktop analysis that one of my staff, Emma Blee, is working on with the team to identify some opportunities of how can we deal with…the injured employees”. Fahour stated that he then told Walsh that he did not know anything about it; that it had never been raised with him and it was the first time he had heard of it. He stated that Walsh replied that “it’s just some analysis that somebody is doing”. Fahour then said that he responded to Walsh as follows (emphasis added):

‘Okay. Well, that’s useful to know.’ I said, ‘But it seemed to me, from what I gathered, [Metcher] was very agitated, very concerned that we are secretly plotting to do this and that Michael Newton was leading this analysis and he had it in for these 3000 people, it seems. That’s my impression that I’ve gathered. And I’m concerned that if Michael [Newton] is just doing his job, that somehow, he’s going to, you know, be targeted in ordinary course of doing his job and I’m really concerned about that.’

111    Asked whether in the phone call he gave Walsh any instructions or directions, Fahour referred to four things as follows (emphasis added):

Well, after she had explained to me what was going on, I said to [Walsh], ‘Look, [Walsh], I’ve thought this thing through, and I’m doing this a little bit on the fly, but I need to do something today because I’m worried about what’s going to happen over the weekend, and misinformation is going to be spread about our reform program and this Operation Dove.’ And I said, ‘If this is just an analysis, the numbers don’t sound right to me at all. As if we would ever, ever fire 3000 injured employees, let alone if it’s even legal to do such a thing. We – this is completely in contrast. So do you agree with me that there is nothing to be lost by just stopping this analysis so that we can demonstrate unequivocally, at least to Greg Rayner, the national secretary of the union, that there is no substance to this secret project to fire 3000 people?’ And she said, ‘That – that is no problem at all. We can easily close that analysis,’ is what she said to me. So I said, ‘Fine. Well, that’s an easy decision.’ The second one of what I communicated – and I think was very clear in my mind – I said, ‘Look, it’s really important that the health and wellbeing of the people who are surrounding this area is protected, including you, [Walsh], because I’ve noticed you’ve been copping a lot with me, as you know, [Metcher’s] fury, and I’m really worried about you and your health and wellbeing.’ I said, ‘I can handle it; I’m the CEO, and so, therefore, I can take this pressure. We’ve got 1000 things we’re doing. I need you to get some help for yourself and any support, so let’s talk about that.’ So we talked about that. And then thirdly, I said, ‘This review that we have to do on workers’ compensation that we need to do, given that this person whom I don’t know, Michael Newton, is heading it, can we park him aside somewhere else just temporarily while we sort out what’s going on here and how we handle this because I don’t want him to cop any flak from [Metcher] or anybody else. So just move him somewhere. Just don’t let him be affected by this – this situation.’ And then last, ‘Can we catch up some stage early next week and talk about ideas that I’ve been developing of how we can do this workers’ compensation review so that we can get agreement with the union movement that we would do that.’ They – they were the – essentially the four or five things that I had come up with on the spot to defuse and to protect the organisation and the individuals within the organisation to the best of my ability.

112    Fahour also added that he asked Walsh to “by the close of business to discuss this with her team and to cease this Operation Dove analysis”. He said that Walsh agreed she would do that.

Consideration

Were threats/demands made by Metcher?

113    For the reasons already discussed, Michael Newton bears the onus of proving the “action” alleged under ss 348 and 355, namely that Metcher made the threats alleged and recorded at [13] above. By reason of the principles expressed at [25] above, I reject the contention made by the APC respondents that because the alleged threats were conditional they were not “threats” of a kind which are capable of engaging ss 348 or 355 of the FW Act.

114    The conditional nature of the threats as alleged is nevertheless important, the condition being that the threatened actions would be taken unless Fahour cancelled Project Dove and removed Michael Newton from his position. Those conditions are what Michael Newton asserts was demanded of Fahour by Metcher. They form part of the “action” that Michael Newton must demonstrate occurred. The trial was conducted on the basis that Michael Newton accepted that it was his onus to prove that Metcher demanded that Project Dove be cancelled and demanded Michael Newton’s removal from his role as National Compensation Manager.

115    Additionally and in support of his claim that APC and Fahour were accessorily liable, Michael Newton has also alleged that in the 5 February conversation with Metcher, Fahour responded to Metcher’s threats and demands by agreeing to cancel Project Dove and remove Michael Newton from his position. That is also an allegation that Michael Newton must prove.

116    At the outset, I should say that the fact finding exercise in which I am here involved is not straightforward. It has been complicated by issues of credit and also by the fact that some matters have been admitted by some respondents but not others. Nevertheless, in the end, I have been able to reach the conclusions I have made with sufficient confidence.

117    There is direct evidence from Fahour which denies each of the two critical demands alleged to have been made by Metcher in Metcher’s conversation with Fahour on 5 February 2016. Fahour denied that Metcher demanded that he cancel Project Dove or that he remove Michael Newton from his position. If all that evidence was accepted, Michael Newton’s fate on his ss 348 and 355 claims would be sealed. However, as earlier indicated, the caution which I have determined to take with the evidence given by Fahour means that I have not been prepared to accept his evidence as reliable unless it is corroborated by other evidence or there is a basis for believing the evidence to be plausible.

118    Michael Newton’s best point in support of a finding that the demands for which he contends were made, is the uncontested fact that the decisions made by Fahour to remove Michael Newton from his position and to cancel Project Dove were made by Fahour very shortly after his conversation with Metcher and were likely to have been responsive to something said, done or appreciated in that conversation. On any view, the decisions taken by Fahour to cancel Project Dove and remove Michael Newton from his position were extraordinary decisions taken in great haste. It may be inferred that Fahour was responding to an extraordinary circumstance which had imposed intense pressure upon him to act extraordinarily.

119    Objectively discerned, the decision to remove Michael Newton from his position was extraordinary for many reasons. Fahour must have known that such a decision was likely to have ramifications for Michael Newton and for APC. Such a decision would not ordinarily be made by a manager in Fahour’s position without advice, including advice as to APC’s contractual or other legal obligations to Michael Newton. The ramifications for APC and for Michael Newton would ordinarily be carefully assessed. Yet Fahour’s decision to remove Michael Newton was made with no apparent consideration of its potential ramifications for either Michael Newton or for APC.

120    On Fahour’s account, the decision to remove Michael Newton was made in circumstances where Fahour knew nothing of Michael Newton other than that Walsh told him that he was a manager working for APC in the workers’ compensation unit. There is no suggestion in the evidence that when the decision was taken Fahour knew anything at all about Michael Newton’s contract of employment, or very much about the nature of the work he was doing within the workers’ compensation unit or of its importance. A decision of that kind, particularly if it were taken, as Fahour deposed, to protect Michael Newton from Metcher might be expected to have been taken after some consultation with Michael Newton. There was no consultation. Nor was there any evidence of any significant attempt made by Fahour to obtain information to enable an informed decision. The decision was obviously made with extraordinary haste, indeed as Fahour told Walsh in their conversation of 5 February 2016, he was acting “a little bit on the fly”. Fahour required that the decision be implemented immediately (before the close of business on 5 February 2016). All of that is demonstrative of the likelihood that Fahour was acting under great pressure.

121    The decision to cancel Project Dove was also taken without Fahour having any significant understanding of the nature, objective or importance of Project Dove and the ramifications, both legal and operational, of its immediate cancellation. I say that accepting Fahour’s evidence that as at 5 February 2016 and prior to his interactions with Metcher on that day, he knew nothing of Project Dove, but not accepting Fahour’s evidence that in his conversation with Walsh she told him that it was “some desktop analysis” that Blee was working on. For Walsh to have down-played the prominence of Project Dove in that way would have involved Walsh substantially misrepresenting the position to Fahour. Although still in a development phase, there was cogent evidence before me to which I have already referred, that by 5 February 2016 Project Dove was no “desktop analysis”. Apart from the extensive attention given to its development by Michael Newton, other senior managers (including Walsh, Bass and Blee) had had considerable input into Project Dove. Project Dove had a not insignificant history at APC. Between January and June 2015 Michael Newton and others were scoping the project which was formalised in June/July 2015. Project Dove then became a performance target for Michael Newton, with 20% of his performance review for the 2015/16 financial years relating to Project Dove. Further, as Michael Newton deposed, and as the evidence suggests, Project Dove was approved at the APC People Remuneration Culture Forum (“PRCF”) in September 2015, a management committee chaired by Blake, where a noting paper on the Project was tabled and accepted as read. After receiving PRCF approval, in January 2016 letters were being sent out as part of Phase 1 of Project Dove to APC’s long-term workers’ compensation claimants.

122    Even if Fahour had been misled into believing that Project Dove was of less significance than the reality, the lack of information he had or sought about Project Dove and about Michael Newton’s circumstances, strongly suggests that Fahour was of the view that whatever the ramifications were for APC or for Michael Newton of Michael Newton being removed and Project Dove being cancelled, those ramifications were far less serious than the ramifications of not acting to remove Michael Newton and cancel Project Dove. I readily infer, and it is not really in contest, that something highly consequential occurred in the conversation between Fahour and Metcher, something which was sufficiently serious and substantial to have motivated Fahour to take the extraordinary and urgent action that he did.

123    That all makes it likely that something that Metcher said or did during the conversation or something that Fahour appreciated as a result of that conversation was the impetus for Fahour’s decision.

124    That Metcher may have made forceful demands or threats would not, on the evidence, be out of character. The evidence suggested a significant history of antagonism and anger from Metcher directed at APC managers in relation to concerns Metcher had for the plight of injured CEPU members and their treatment under APC’s workers’ compensation system. Metcher had expressed those concerns in strong, colourful terms and, at times, in terms that were open to be regarded as disrespectful. A range of examples were relied upon by Michael Newton including comments made in various email exchanges relating to the White issue, to which I have referred earlier. The examples relied upon include Metcher describing APC’s workers’ compensation processes as a “broken system”; that he described himself as being “filthy angry” at APC’s workers’ compensation unit and described that unit as a “dam disgrace”; that he accused the unit of being “incompetent” and that he accused Blee of lying to him.

125    To further support the characterisation of Metcher as forceful and demanding, Michael Newton relied on various records made by APC employees. In particular Blee made a complaint on 16 April 2016 to APC (the “Blee complaint”) in which she stated that APC employees are repeatedly told that they have to tolerate or ignore “Metcher’s tirades even when the attacks are incredibly personal”. She described Metcher as a bully and characterised APC’s acceptance of his behaviour as amounting to “company sanctioned bullying”. In other documentary evidence, Walsh described Metcher as a “bear” in observing that APC employees dealing with workers’ compensation claims were “well versed in not poking the bear”. Neither Walsh nor Blee were called to give evidence. Their characterisations of Metcher were not objected to or otherwise contested.

126    There was other evidence relied upon by Michael Newton to portray Metcher as the type of person likely to make threatening demands. As earlier recorded, shortly after Michael Newton commenced his employment, he met with Metcher in a meeting held on 1 April 2014 also attended by Blee and Metcher’s son, Nathan Metcher. Michael Newton deposed that at the meeting Metcher said words to the effect that nothing happened at APC within its workers’ compensation unit without it going through him as otherwise there would be consequences, and further that Metcher had had a previous manager dismissed and that the same would happen to Michael Newton if Metcher was not treated with respect. That those words were said was denied by Nathan Metcher. It is, however, unnecessary to resolve that particular conflict in the evidence other than for one purpose. In so far as that evidence was directed to persuading me that Metcher was well capable of making threatening demands upon APC, and doing so forcefully, there is sufficient other evidence which has persuaded me to accept that proposition. In so far as that evidence was being relied upon by Michael Newton to suggest that Metcher had previously demanded that a manager be sacked and was thus predisposed to make a demand of that kind, I do not accept the evidence to be reliable. Michael Newton had contemporaneous notes which he recorded during the course of the meeting. However, the line in his note concerning Metcher having had a previous manager dismissed was not written during the meeting like the rest of the note. Michael Newton deposed that it was written into his note when he was in a taxi after the meeting. Michael Newton explained that he did not bother to record Metcher’s comments, in particular the threat in relation to Michael Newton’s position during the meeting because Metcher’s bad behaviour was tolerated by APC. He also said that he did not take the claim seriously. It is difficult to accept Michael Newton’s claim that shortly after the meeting he added a reference to Metcher’s asserted claim. Why he did that after the meeting in circumstances where he was not motivated to do that during the meeting was not explained and caused me to doubt the reliability of the evidence in circumstances where Nathan Metcher denied that the assertion was ever made. In any event, Michael Newton’s evidence that he did not take the claim made by Metcher seriously diminishes the potency of that evidence, even if I had accepted it.

127    Although I accept Michael Newton’s contention that Metcher had a history of making threats and demands and that APC was inclined to tolerate his behaviour and be responsive to his demands, I think it is also important to notice Metcher’s modus operandi. The threats made by Metcher which were in evidence and which were made prior to 5 February 2016, were not threats of disruption, whether by way of industrial action or otherwise, or threats of any unlawful conduct. The threats made by Metcher that he or the CEPU would take action unless his complaints about the workers’ compensation system were addressed, were threats about the CEPU publicly and politically exposing the way in which injured workers were being treated by APC. An important example is contained in an email mentioned at [84] and sent by Metcher to Walsh and Fahour (copied to the CEPU National Office officials) on the day before his conversation with Fahour, in which Metcher informed Walsh and Fahour that (emphasis added):

I intend to present Ms White and other sick and injured workers of [APC] as examples to [sic] how sick and injured workers are treated by [APC] and their claims are being managed under the Workers’ compensation systems of [APC] when in Canberra on Monday and Tuesday next week.

128    APC is a major government business enterprise. It is also a prominent entity whose activities, although diminished in the modern era, remain important to all Australians and attract political attention. Fahour expected that negative information about a government business enterprise like APC would be communicated to parliamentarians in the Labor Party by the unions. That APC was frequently subject to or likely to be subjected to parliamentary oversight through Senate estimates processes was apparent from Fahour’s evidence. APC’s sensitivity to political scrutiny and potential criticism was manifest in the evidence Fahour gave on that issue, evidence which I regard as plausible. Even prior to receiving the 4 February 2016 email in which Metcher expressly told APC that he would raise his complaints “when in Canberra”, Fahour had anticipated that allegations were being made by Metcher that might find their way to the Senate estimates program. For that reason, as discussed at [74]-[75], on 3 February 2016, he instigated the Leanne White Review requiring that the review be conducted urgently so that APC would have an answer at Senate estimates for the allegations Fahour contemplated would there be raised.

129    APC’s appreciation that political exposure would be Metcher’s weapon of choice and APC’s sensitivities to that eventuality is also demonstrated in an email dated 23 January 2016 which was sent to various APC managers, in which Walsh stated that “[Metcher] has gone off again about a workers’ compensation issue and has now made a number of serious threats about having a very public outing of the [APC] workers’ compensation system flaws…at Senate estimates, in the media or potentially a Senate Inquiry”. Walsh stated that the particular issue that had driven the “current escalation” was whether APC was required to pay public holidays to its employees on workers’ compensation and at what rate. She stated that she feared that whatever position APC took, Metcher was “so unwell and irrational at the moment” that he would nevertheless “still play this out at Senate Estimates or call for a Senate inquiry”. Walsh then suggested that APC should do some background lobbying with the “Labour [sic] Party” so that APC could try to get on the front foot and “prevent this going down the Senate estimates path”.

130    In my view, it is highly likely that Metcher’s threats that he would take his complaints to Canberra were made with an appreciation of APC’s sensitivity to political scrutiny of its activities. It is likely that a long standing senior and experienced union representative of APC employees well understood APC’s sensitivity to public and political scrutiny. It is likely, that Metcher considered that the threat of political exposure was likely to be an effective strategy to be deployed by the CEPU in addressing concerns about the mistreatment of injured employees. As Metcher’s 4 February 2016 email to Walsh and Fahour referred to at [84] demonstrates, Metcher was upfront about his intentions. He told them that he would be raising his concerns about APC’s treatment of injured workers in Canberra on the following Monday and Tuesday.

131    It is not clear on the evidence exactly when Metcher discovered the existence of Project Dove. It is clear that about an hour and a half after he sent the email of 4 February 2016 and at the conclusion of the meeting of the APC Workers’ Compensation Reform Forum, Metcher told Michael Newton that he “was in possession of Project Dove documents” as detailed above at [85]. Given that none of Metcher’s earlier communications with APC complaining about the treatment of injured workers raised Project Dove or its subject matter, it seems to me most likely that Metcher learned of Project Dove on or perhaps shortly before 4 February 2016. I do not doubt that Metcher was likely incensed by what he had discovered which, from his perspective, was the prospect that APC was working on a plan to dismiss some 3,000 injured workers on workers’ compensation payments. Those prospective dismissals, I would infer, would have been regarded by Metcher as highly detrimental to the interests of both the injured employees and the CEPU. If Metcher believed that APC was intent on dismissing 3,000 injured employees he is likely to have regarded that prospect as both unprecedented and outrageous. Any union official in his position would likely have been incensed and most if not all union officials in Metcher’s circumstances would likely have been highly motivated to do something to stop it. There is good reason to accept Fahour’s evidence that when his conversation with Metcher on 5 February 2016 turned to Project Dove, Metcher’s language was “vile”, that he was “upset”, “really really angry”, that “he was deeply and emotionally [disturbed] – beyond anything I have ever seen in my life”.

132    The evidence also permits the inference that on learning of Project Dove and given Metcher’s understanding of what was intended by APC, Metcher must have thought he had struck gold in relation to his intended campaign to politically expose APC in Canberra about how APC treated its injured workers.

133    Whilst I need to be cautious with evidence given by Fahour, I accept his evidence that Metcher said in relation to Project Dove words to the effect that “I’m going to make sure that I expose you and all your staff for what you are about to do”. I also accept that it is likely that Metcher said that he was going to stop Project Dove and identified at least some of the means he intended to utilise.

134    The APC respondents admitted that Metcher made a request that Project Dove be cancelled. However, as against Metcher and the CEPU there is no such admission. Michael Newton contended that the evidence of Fahour denying that such a request was made should be rejected and that an inference should be drawn that the request was made because it is inherently unlikely that Metcher would make a series of threats to Fahour to take certain action, not seek anything in return and not subsequently carry out any of the threats he had made.

135    Fahour denied that Metcher had demanded that he shut down or cancel Project Dove or that he had interpreted that any such demand had been made from anything said by Metcher. However, he confirmed in cross-examination that it was apparent to him that Metcher had strong negative views about Project Dove. As referred to earlier at [104], in response to whether it was clear to him that Metcher did not want Project Dove to proceed, Fahour said “He didn’t tell me that. But I can assume that that is something he wouldn’t want done”.

136    It may well be the case that a request to cancel Project Dove was not expressly made but that does not foreclose a finding that the request was not made implicitly. Fahour’s evidence of his subjective perception as to whether or not such a request was implicit is contradictory. His answer given in cross-examination suggests that it was. In any event, Fahour’s subjective perceptions are not determinative. As stated earlier, the issue must be assessed objectively.

137    Given my acceptance that Metcher was strongly opposed to Project Dove and made that opposition crystal clear to Fahour including by threatening the actions he threatened to take as part of his campaign to stop it, I accept that a reasonable person would have construed Metcher as demanding that Fahour shut down or cancel Project Dove.

138    As to the actions that were threatened should Project Dove not be cancelled, I accept that it is likely Metcher raised the organisation of protest rallies and exposing APC to negative publicity. I accept that it was likely to have been at least implicit from what Metcher did say that he intended to pursue the issue politically. All of that is entirely consistent with reliable evidence of Metcher’s stated position prior to the 5 February conversation in relation to how he would fight to address what he perceived as APC’s mistreatment of its injured employees. It is reasonable to infer that Metcher wanted to stop Project Dove in circumstances where he likely perceived it as a further and gross example of APC’s mistreatment of its injured employees.

139    I am satisfied on the basis of the findings I have just made as to the actions raised by Metcher that those actions are objectively to be construed as having been threatened. I take into account not only what was said but the context in which it was said and the aggressive and forceful manner in which the taking of those actions was raised. I accept Fahour’s evidence about the forceful nature of the language used by Metcher in the conversation. That is all consistent with evidence of Metcher’s prior behaviour and also consistent with reliable evidence of Fahour’s reaction to the conversation and what I have described as the extraordinary decisions that he then took. In relation to Metcher’s communications that he would organise protest rallies, expose APC to negative publicity, pursue APC politically and take legal action against APC, I am satisfied that the communication was a warning of an intention to inflict harm made for the purpose of intimidating Fahour and APC and that Metcher held a subjective intent to carry out those actions. Each of those communications was capable of constituting a threatened action within the meaning of s 348 of the FW Act.

140    I accept that Metcher threatened to take action within the meaning of s 348 of the FW Act. The action threatened was to organise protest rallies and expose APC to negative publicity and political scrutiny if Project Dove was pursued. For the purpose of proving that Metcher threatened to take action within the meaning of s 348, the threat of organising political exposure is of itself sufficient to establish that element of the cause of action as against each of the respondents. However, that was but one of the five threatened actions pleaded by Michael Newton.

141    Michael Newton also pleaded that Metcher said that he would “take [APC] to the cleaners”. As against Metcher and the CEPU and in so far as that allegation is to be understood as a threat to expose APC to negative publicity, I accept that the threat was made. As against the APC respondents the making of that threat was admitted so far as it was conditional upon the cancellation of Project Dove. I would accept that the threat of action was likely associated with the demand that Project Dove be cancelled.

142    I also accept that Metcher said he would “take legal action”. Metcher had made a number of complaints prior to his conversation with Fahour that White and others on workers’ compensation payments were not being paid their annual leave entitlements. Consistently with the making of those complaints, I accept Fahour’s evidence that Metcher raised the taking of legal action against APC for breaching “the Health and Safety Act”. The APC respondents admitted that that threat was made. However, as against each of the respondents, it has not been demonstrated that the threat was made in relation to either Project Dove or any demand made to remove Michael Newton. It is likely that this threat was made in relation to Metcher’s complaint that APC had failed to pay annual leave entitlements to White and other employees.

143    Michael Newton also pleaded that Metcher said that he would “leak the [leaked APC documents about Project Dove] to the media and politicians”. In support of that contention, although it is not clear, Michael Newton appears to have relied upon evidence given by Fahour that he suspected that at “some stage” (a likely reference to a time much later than February 2016) Metcher “leaked, discussed Project Dove to [sic] the Parliamentarians”. Fahour went on to say that this was his assumption and that he did not know where information about Project Dove in the hands of politicians came from including because representatives of both the Opposition and the Government questioned APC about Project Dove at a hearing of Senate estimates. That evidence does not address what was said in the conversation of 5 February 2016 at all. Although the evidence deals with communications received by politicians about Project Dove, it does not in terms address “leaked APC documents about Project Dove”. The evidence is not capable of sustaining an inference against Metcher and the CEPU that the threat as pleaded was made on 5 February 2016. As against the APC respondents, those respondents admitted the making of the threat although they did not admit that Metcher referred to the APC documents as “leaked”.

144    Further, Michael Newton pleaded that Metcher also said that he would “take serious industrial action”. Michael Newton contended for a finding that Metcher threatened that he would organise unlawful industrial action. The finding sought goes beyond the threat which was pleaded. The taking of industrial action by the CEPU and its members may be lawful or it may not be. Much depends upon whether the industrial action is taken as “protected industrial action” provided for by Part 3-3 of the FW Act. The allegation that “serious industrial action” was threatened is not an allegation of a threat of unlawful industrial action. Whilst the APC respondents admitted the allegations made, the admission does not constitute an admission that Metcher threatened unlawful industrial action. Fahour deposed that Metcher raised the taking of industrial action. His evidence was that Metcher was talking about “legalised industrial action”, that is, action that APC could not stop. What Metcher actually said to give him that impression was not dealt with.

145    I am not prepared to accept that a communication was made by Metcher that the CEPU and its members would take unlawful industrial action. First, there is no evidence that action of that kind was ever previously raised by Metcher in support of his campaign against APC’s treatment of its injured workers. If I accept Fahour’s evidence, which is the only available evidence as to whether lawful or unlawful industrial action was threatened, Fahour deposed that his understanding was that lawful industrial action was threatened. If I do not accept Fahour’s evidence, there is simply an insufficient basis available on the evidence to make a finding that unlawful industrial action was threatened.

146    I will return to consider the other elements necessary for Michael Newton to demonstrate a contravention of s 348 in relation to threats made by Metcher to take action unless Project Dove was cancelled. It is convenient that I first consider, in relation to the s 348 claim, whether Michael Newton has established that Metcher made threats demanding that Michael Newton be removed from his position as well as, in relation to the claim of contravention of s 355, whether Metcher demanded that Michael Newton not be allocated the duties or responsibilities of the position he then held as National Compensation Manager. I will first consider the position as against Metcher and the CEPU.

147    The factual circumstances that support my finding that Metcher had a strong motivation to stop Project Dove are not necessarily transferrable to support a finding that Metcher was motivated to have Michael Newton removed from his position. The extent to which Metcher considered Michael Newton responsible for Project Dove is not entirely clear. In his email of 5 February 2016 he did refer to Project Dove as “Michael Newton’s ‘Operation Dove’!” Fahour said that he told Michael Newton, in their conversation on 12 February 2016, that Metcher had referred to Michael Newton leading Project Dove with Walsh. However, on Fahour’s account, Metcher attributed primary responsibility for Project Dove to Fahour. Metcher thought that Fahour was “secretly plotting behind the scenes”. Fahour said that after himself “the next person [Metcher] went after was [Walsh]”. On Fahour’s evidence, Michael Newton was mentioned “very much in passing” and referred to as “Fahour’s henchman” doing Fahour’s “dirty work”. Fahour described Metcher as being absolutely convinced that Fahour and Walsh and the management team were involved. Fahour said that Metcher’s focus was “on exposing me and [APC]”.

148    It is sufficiently clear on the evidence that on 5 February 2016 Metcher understood that Michael Newton had a significant association with Project Dove. However, there is no basis for thinking that Metcher would have regarded Michael Newton as the only person responsible for Project Dove and given the subject matter of Project Dove, its scale and unprecedented nature, I would infer that Metcher would likely have assumed that such a program could not get off the ground without the support of very senior management including Fahour. I would accept Fahour’s evidence that Metcher perceived Fahour as being behind Project Dove and that Michael Newton was his “henchman”. Fahour’s evidence that Metcher refused to accept Fahour’s protestations that he was not involved is, in my view plausible.

149    Further, there is no cogent basis for thinking that Metcher would have regarded the removal of Michael Newton from his position as likely to significantly ameliorate, let alone remove, his concerns about the implementation of Project Dove. In terms of Metcher’s perceptions, the removal of Michael Newton from his role would have achieved very little unless Project Dove itself was cancelled. There is no reason to infer that Project Dove and its cancellation was not Metcher’s main objective. If Metcher wanted the removal of a person from his or her position, that objective was only ever likely to have been supplementary or subsidiary to the cancellation of Project Dove. The evidence does not enable the inference that Metcher would have held the view that it was necessary to take down Michael Newton in order to stop Project Dove.

150    If Metcher was motivated to take a scalp out of vengeance rather than necessity, it is not clear that Michael Newton would have been the head that he wanted rolled. It may have been that Metcher recognised Michael Newton as the instigator of Project Dove but on Fahour’s evidence Metcher directed his anger firstly at Fahour and secondly at Walsh with whom he had a long-standing relationship and according to Fahour said, as referred to at [98], “I’ve worked with her for all these years and I can’t believe that she’s turning her back, as the head of HR, on these injured people”. The evidence demonstrates that Metcher had issues with a number of employees within the workers’ compensation unit, including Blee, who he accused of lying to him. There is no credible evidence that at least before 4 February 2016 or thereabouts (when Metcher discovered Project Dove), Michael Newton was on Metcher’s radar at all. The complaints that he had made critical of the workers’ compensation unit did not single out Michael Newton for any criticism.

151    Fahour’s denials that any such request or demand was made would be determinative of the issue if that evidence is accepted. If that evidence is rejected as Michael Newton urges me to do, there is really little beyond the fact that Michael Newton was removed from his position shortly after Fahour spoke to Metcher to sufficiently support an inference that Metcher demanded that Michael Newton be removed. If the only possible and cogent explanation for that removal was a demand made by Metcher, Michael Newton’s position may well be stronger.

152    However, Michael Newton’s contention that there was no “logical explanation” for his removal from his position other than that Fahour acceded to a demand from Metcher that that be done should not, in my view, be accepted. On the basis contended for by Michael Newton, that Fahour’s evidence that no such demand was made is unreliable and that Fahour’s explanation for removing Michael Newton is also unreliable (a matter to which I will return), there is at least one other logical explanation for why Michael Newton was removed.

153    In my view the following statement made by Fahour cogently identifies the primary fear, sensitivity and concern held by Fahour as a result of what Metcher communicated to him during their telephone conversation on 5 February 2016 (emphasis added):

And I got off the phone and I remember I looked out the window of my car and I was in shock. I actually didn’t know what – like I was in – I was in shock that he could be so wrong and so misjudge what I wanted to do and what I was trying to do for the staff, and the intention, and I was concerned, deeply concerned, that he could, through negative publicity, derail the single largest reform program in the history of [APC]. And that would be a monumental disaster, because, if the Parliament reversed the decision we had to go and find $6.7 billion of funding, and I was really afraid for the 20,000 people that worked in the mail centres, the posties, the retail staff. I was deeply concerned about where their livelihood would come from, and that if he had used his industrial power to cause us to not reform, that – and on – on an incorrect assumption, that this would bring down [APC]. And I didn’t want to be the last chief executive to see 20,000 people marched out without a job.

154    There is, on the evidence, a plausible basis for thinking that there were three driving reasons to explain why immediately after his conversation with Metcher, Fahour was under the immense pressure that I accept he was subjected to. First, he was deeply concerned that Metcher’s threats about exposing Project Dove may bring down the APC reform program. Second, he had failed to convince Metcher that Project Dove did not exist or would not be pursued. Third, he was convinced that Metcher had the capacity to and would begin using Project Dove to seriously damage APC immediately, recalling in particular that Metcher had stated in his email of 4 February 2016 that he was taking his campaign to Canberra on the following Monday 8 February 2016. In those circumstances and particularly as Fahour had no attachment to Project Dove, the most obvious thing for Fahour to do was to continue to try and convince Metcher that Project Dove was not going to occur. It seems to me at least logically possible (if not likely) that Fahour realised that it was necessary for him to do something concrete and convincing and do it quickly. One possible means of convincing Metcher that Fahour had no intention of pursuing Project Dove was to remove from the arena the person that Metcher regarded as Fahour’s “henchman” for implementing Project Dove. On that scenario, Michael Newton was the sacrifice necessary to be made in order for Fahour to protect what he was most deeply concerned about, the damage that Metcher and the CEPU could do, mainly through political processes, to the APC reform program.

155    It is instructive, I think, to notice that there is no evidence of Metcher exposing Project Dove in Canberra on 8 February 2016 or any time soon thereafter or possibly at all. Indeed, at about 11am on Monday 8 February 2016, Metcher sent an email to Fahour referring to their discussions of the previous Friday. The email was civil and polite. It indicated that Metcher was now receptive to the conduct of the Leanne White Review and proposed the CEPU’s nominee for the team of persons who were to conduct that review. The email made no mention of Project Dove. It seems likely that by the time this email was sent, Metcher had been convinced to accept that which he had rejected during the conversation with Fahour on the previous Friday, that APC would not pursue Project Dove. There is only one event of relevance in the evidence before me that occurred between the conversation on 5 February 2016 and Metcher’s communication on 8 February 2016. That event is that Michael Newton was removed from his position. There is no direct evidence of how the removal of Michael Newton from his position was communicated to Metcher. Fahour deposed that he did not communicate that to Metcher but, although he said he was speculating, he said he assumed that Walsh would have done so.

156    I do not positively find that Fahour removed Michael Newton from his position because he sought to convince Metcher that Project Dove was truly dead and buried. I need not make that finding. However, that Fahour removed Michael Newton for that reason is an inference not less supportable than the inference that Michael Newton was removed from his position because Metcher demanded that Fahour do so. In other words, each of those reasons are possible logical explanations for why Michael Newton was removed from his position. If the existence of only one logical explanation for Fahour’s conduct had been sufficient to allow the inference contended for by Michael Newton to be drawn, the inference cannot be drawn because there are other logical explanations which can explain Fahour’s conduct.

157    I have arrived at that conclusion mindful of the fact that, although I raised the possible explanation I have just set out with Michael Newton’s Counsel, it had not been raised or relied upon by any of the respondents and not put to Fahour. None of the respondents had an incentive to put that case because each sought to convince the Court that Fahour was a reliable witness whose explanation for removing Michael Newton should be accepted. Fahour deposed that Michael Newton was removed because of Fahour’s concern for Michael Newton’s wellbeing and in order to protect him from exposure to Metcher. Michael Newton contended that I should not accept Fahour’s explanation and for the reasons that follow I do not. However, my non-acceptance of that evidence (which has contributed to my concern about the reliability of Fahour’s evidence and the general impression I gained of him), serves to support the existence as a logical possibility of the undisclosed explanation I have raised, and does so despite the unfortunate position that the explanation was not explored with Fahour.

158    There are a number of reasons why I do not accept that Fahour removed Michael Newton from his position to protect Michael Newton’s wellbeing. First there was an inconsistency in Fahour’s evidence as to who raised a concern for Michael Newton’s welfare. Fahour deposed that he explained his decision to Walsh (in his conversation with Walsh following his conversation with Metcher) on the basis that he did not want Michael Newton “to cop any flak from [Metcher] or anybody else”. Contrary to that evidence given in chief, which suggested that protecting Michael Newton was Fahour’s idea, in cross-examination and in an attempt to explain his decision in the context of his evidence that he did not know Michael Newton at the time, Fahour deposed that Walsh had told him that Michael Newton was a “good person” and “good manager” and that it was Walsh who raised the need to protect Michael Newton.

159    Second, Fahour’s evidence that he told Walsh to remove Michael Newton in order to protect him is inconsistent with the explanation for the decision given by Walsh in a meeting she had with Blee and Michael Newton shortly after her conversation with Fahour on 5 February 2016. Walsh did not explain the decision on the basis that it was made to protect Michael Newton. She merely said that Michael Newton was being removed from his position “as a result of a phone call Ahmed Fahour received about proposed management of injured workers”.

160    It seems to me more likely that if the decision was taken for Michael Newton’s benefit and out of a concern for his wellbeing, especially if taken at Walsh’s suggestion, Walsh would have explained the decision to Michael Newton on that basis. She did not. Neither did Blee when two days after the decision was made she wrote to another APC senior manager saying that Fahour had insisted that she and Walsh inform Michael Newton “of the temporary change Friday afternoon because of some pending media and legal threats”.

161    Third, I think it unlikely that such a decision would have been taken for the reason given by Fahour without some consultation with Michael Newton. If the object of the exercise was to look after Michael Newton, surely his input including his view as to whether or not he needed protection from Metcher and his view as to whether or not the removal from his position was ultimately of benefit to him, would have been canvassed.

162    Fourth, why was it imperative for the decision to be made and implemented immediately? Surely if Michael Newton’s welfare was the driving motivation, the decision could have waited until the following Monday or later. Fahour’s suggestion that he was concerned that Metcher would attack Michael Newton over the weekend was unconvincing, particularly in light of the next reason I have for rejecting his explanation.

163    Fifth, Fahour’s evidence was that Michael Newton needed protection from Metcher not because of anything to do with Project Dove but because Michael Newton was “heading” the Leanne White Review. Read in the context of other evidence Fahour gave, I understood Fahour to mean by that that Michael Newton would be particularly exposed to Metcher whilst the Leanne White Review was being conducted because he was the person responsible for the workers’ compensation unit. There are a number of difficulties with that evidence including that, when the decision was made on 5 February 2016 shortly after the discussion between Fahour and Metcher, given the conversation he had just had with Metcher, Fahour could have had no confidence that the Leanne White Review (which required the cooperation and involvement of Metcher) would be conducted. Secondly, Michael Newton had little to do with the complaint made in relation to White or the wider issues raised by those complaints. There are others, including Blee, that the evidence suggests were far more directly in Metcher’s sights than Michael Newton in relation to issues that would be the subject of the Leanne White Review. Why Fahour considered it was necessary to protect Michael Newton from Metcher rather than someone like Blee was not really explained by Fahour and it was Blee who took over the responsibilities of Michael Newton’s role when he was removed from his position. Additionally, and I think tellingly, Fahour’s evidence that his concern to protect Michael Newton from Metcher because of the Leanne White Review is entirely inconsistent with Fahour’s refusal to allow Michael Newton to take up a position in the workers’ compensation unit after the Leanne White Review had been completed. Fahour adopted that position, despite the Leanne White Review making no finding of any sort against Michael Newton, and despite the fact that following the Leanne White Review a new process for interacting with the CEPU (“CEPU escalation arrangements”) was established within the workers’ compensation unit such that all future interaction with the CEPU would be directly through Darryl Newton and not with the workers’ compensation unit. This new process would have prevented Michael Newton from having any potential interaction with Metcher if returned to the workers’ compensation unit.

164    Fahour’s refusal to permit Michael Newton to return to a position involved with workers’ compensation or injury management continued through to the termination of Michael Newton’s employment in August 2016. As the evidence I discuss when dealing with the contractual claims demonstrates, that was so despite suitable alternative positions in that area of APC’s activities being available and despite both Walsh and Darryl Newton being of the view that Michael Newton should take up the position of Manager Injury Management Strategy. It became clear from the evidence of Darryl Newton that Fahour had directed that Michael Newton not be placed in that role and nor was he to be reappointed into the National Compensation Manager position. Despite efforts made between April and August 2016 to find an alternative position for Michael Newton, no position in workers’ compensation or injury management was ever offered to him. I would infer that that occurred because of the direction made by Fahour.

165    That all of that occurred out of a concern by Fahour for Michael Newton’s welfare is neither plausible nor believable. All of those findings serve to demonstrate that there was another reason, a reason other than that proffered by Fahour, for Fahour’s deep-seated objection to Michael Newton occupying a position which involved Michael Newton with workers’ compensation or injury management at APC. The difficulty for Michael Newton’s case is that the available explanations which may reveal that other reason, are not confined to the “logical explanation” for which Michael Newton contended.

166    For all of those reasons, Michael Newton has not established as against Metcher and the CEPU that, in the conversation between Fahour and Metcher, Metcher demanded that Michael Newton be removed from his position or that any demand was made that Michael Newton not be allocated the duties or responsibilities of that position. The evidence admissible as against Metcher and APC does not give rise to reasonable and definite inferences that such demands were made.

167    Nor has that been established as against the APC respondents. Both of those respondents denied the making of any request or demand by Metcher that Michael Newton be removed from his position. They did however admit that Metcher told Fahour that he could not work with Michael Newton anymore. The admission cuts both ways. It supports Metcher having a motive to make the demand contended for by Michael Newton. However, that that was said by Metcher also supports Fahour using the removal of Michael Newton as an instrument to convince Metcher that Project Dove would not be pursued. In the end, I am not satisfied that the circumstances appearing in the evidence admissible against the APC respondents give rise to a reasonable and definite inference that Metcher made a request or demand that Michael Newton be removed from his position or not be allocated the duties of his position.

Intent to coerce

Removal of Michael Newton

168    My finding that Michael Newton has failed to establish that Metcher threatened action unless Michael Newton was removed from his position or that he not be allocated the duties of that position is critical to Michael Newton’s ss 348 and 355 claims based on that threatened action. If I am wrong about that and such a threat was made, those claims would fail in any event.

169    There is an issue as to whether Michael Newton engaged s 361(1) by making the requisite allegation (see [37] above) that Metcher had an intention to negate APC’s choice. In relation to the s 348 claim, the allegation made in the SFASoC was that “Metcher intended to overbear the will of APC”. In my view, that description was sufficient (in the words of the Full Court in Hall at [41]) to “convey the relevant particular intent” required for a contravention of s 348. In relation to s 355, Michael Newton pleaded that Metcher threatened to take action “with intent to coerce APC”. Pleading the requisite allegation in that form may well be insufficient. I consider, however, that attention must be given to what is conveyed rather than merely what is stated. In the context of what was earlier stated in the pleading as to the nature of Metcher’s intent and given the settled view as to the singular nature of the intent necessary to be proved, I consider that for the legally represented respondents to whom the pleading was directed, the pleading conveyed the allegation that Metcher intended to negate APC’s choice. No practical unfairness was occasioned upon those respondents. There is no basis for thinking that they did not fully appreciate this aspect of the case being put against them.

170    Assuming in favour of Michael Newton that by his pleadings he did enough to engage s 361(1) of the FW Act and proceeding on the basis earlier discussed that s 361(1) is available to be engaged in relation to the making of threats, I would have been satisfied, because the presumption created by s 361(1) was not rebutted, that the “intent to negate choice” element of coercion was established.

171    I would have rejected Michael Newton’s contention that he discharged his onus to establish the second necessary element of coercion – the use of unlawful, illegitimate or unconscionable means. The legal basis for my view that on this issue Michael Newton bears the onus of proof is set out at [29] above. Even if that legal analysis is wrong, and I took the view that Michael Newton could have engaged s 361(1) on this issue, at the factual level and by reason of the pleading deficiencies to which I will shortly refer, I would not have come to the view that s 361(1) was engaged.

172    The deficiencies in the pleading on this aspect of Michael Newton’s case are manifest. Michael Newton failed to plead any material facts in support of any asserted unlawfulness, illegitimacy or unconscionability in relation to his s 348 case. In relation to his s 355 case, even the bare allegation that the threats made by Metcher were unlawful, unconscionable or illegitimate was not pleaded.

173    Michael Newton conceded in submissions made by his Counsel that there was “little by way of articulation” of those matters. It was said, however, and it is the case that the fact that Metcher had leaked APC documents in his possession and that he had told Fahour that he would leak those documents to the media, was pleaded. The first difficulty for Michael Newton is that whilst those allegations were made, the pleading failed to link or connect those allegations to the claims that the threats made by Metcher were unlawful, unconscionable or illegitimate. No such connection is expressed or reasonably to be implied. I would not conclude that, in this respect, the SFASoC satisfied Michael Newton’s obligation to clearly and precisely inform the respondents of the case they had to meet: Hall (at [50]).

174    Michael Newton also relied on an outline filed prior to the commencement of the trial to buttress his contention that the respondents had been put on notice as to the case that they would need to meet that the threats made were unlawful, illegitimate or unconscionable. Paragraphs 26 and 27 of that outline were relied on. There is no mention there made of any leaked APC documents. Under the heading “Coercion: unlawful, illegitimate or unconscionable” the only allegations of any substance were that Metcher “was seeking to interfere with the contractual relationship between APC and [Michael Newton]” and that Metcher’s conduct was “illegitimate” because the means employed by him (presumably in making the threats) “were clearly disproportionate, assessed objectively, to what he and the CEPU might have legitimately wanted to achieve”. No material facts in support of those allegations were given. Michael Newton further submitted that there was no unfairness as proper notice had been given and the respondents’ ability to conduct a trial fairly was not impacted.

175    In Hall, the Full Court at [48] and [51] rejected a contention made by the appellant in that case that the deficiencies in the appellant’s pleading of its case under ss 343 and 355 were overcome by reason of statements made in opening and closing submissions which clarified how those cases were put. Referring to the observations of Mason CJ and Gaudron J in Banque Commerciale SA En Liquidation v Akhil Holdings Ltd (1990) 169 CLR 279 at 286-287, the Full Court in Hall accepted that the general rule that relief is confined to that available on the pleadings, may be avoided where the parties have deliberately chosen to conduct the case on a basis different to that disclosed by the pleadings. However, the Full Court held that there was insufficient evidence in that case of the respondents making any such deliberate choice.

176    There is here no evidence of any deliberate choice made by the respondents sufficient to abrogate the general rule that relief is confined to that available on the pleadings. In any event, the failure of the SFASoC to set out the material facts relied upon to support the allegation that Metcher’s threats were made unlawfully, illegitimately or unconscionably, was not cured by what was stated in the outline of submission relied upon. The outline did no more than pose two legal conclusions. No material facts were given in support of those conclusions. The case that the respondents had to meet was not articulated by the outline relied upon.

177    As no unlawful, illegitimate or unconscionable conduct was either pleaded or established in relation to the threatened action directed at the removal of Michael Newton from his position as National Compensation Manager, the ss 348 and 355 claims must also be rejected for this reason.

Cancellation of Project Dove

178    The same conclusion is applicable in relation to the threat that I have found was made – that unless Project Dove was cancelled Metcher would carry the actions referred to above at [13]. For that reason – that no unlawful, illegitimate, or unconscionable conduct was either pleaded or established in relation to that threat – Michael Newton’s claims of contraventions of ss 348 and 355 in reliance upon that threat, must fail.

179    I should add that even if I had found contraventions of ss 348 and 355 based on the threat directed at Project Dove, no attempt was made by Michael Newton to establish that the conduct in question had caused him any loss or damage. The only apparent purpose of that cause of action appears to be the pursuance of pecuniary penalties.

180    For all those reasons each of the claims made by Michael Newton of contraventions of ss 348 and 355 must be rejected.

Availability of a Jones v Dunkel inference

181    For completeness, I should record that at various times Michael Newton sough to support the factual findings he contended for on the basis of the principle in Jones v Dunkel (1959) 101 CLR 298. Reliance in particular was placed on the failure of APC to call either Walsh or Blee. I would accept that both of those individuals ought to be regarded as in the camp of the APC respondents. If the APC respondents had desired to put a full and comprehensive picture before the Court, it might have been expected that those respondents would have called Walsh and Blee. Nevertheless, Michael Newton did not persuade me that in relation to any particular finding of consequence, the finding he contended for could be made with greater confidence because of the failure of the APC respondents to call Walsh or Blee. It is important in this respect to recall that the principle in Jones v Dunkel is not to be utilised for the purpose of gap-filling: see Hutchinson v Comcare (No 4) [2019] FCA 1133 at [215] (Bromberg J).

Accessorial Liability of Fahour and APC

182    Each of Fahour and APC are alleged to have been “involved in” the contraventions of ss 348 and 355 committed by Metcher within the meaning of s 550 of the FW Act. Section 550 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.

183    Although pleaded more widely, ultimately, Michael Newton only pressed reliance upon paras (c) and (d) of s 550(2).

184    The accessorial liability of the APC respondents would only arise for determination if I had found, on the admissible evidence in the case as against the APC respondents, that a primary contravention (by Metcher) of either ss 348 or 355 had occurred. I have not made those findings. In case I am wrong not to have done so, I will briefly outline why, if either or both of those findings had been made, I would nevertheless have rejected Michael Newton’s case that the APC respondents were accessorily liable. For the purpose of the exercise, I will assume that the contraventions alleged against Metcher are made out (“assumed contraventions”).

185    Michael Newton contended that Fahour (and APC derivatively by reason of s 793 of the FW Act) were “involved in” Metcher’s assumed contraventions by being “knowingly concerned in or party to “those contraventions” (s 550(2)(c)) because:

    in succumbing to Metcher’s coercion, Fahour helped Metcher achieve the outcome Metcher wanted and was thereby “a participant in” Metcher’s contravention; and

    by appeasing Metcher, Fahour associated himself with Metcher’s contravening conduct and was linked in purpose with Metcher.

186    Further, it was contended that Fahour and APC were “involved in” Metcher’s contraventions by “conspiring with others to affect the contraventions” (s 550(2)(d)) because in the conversation of 5 February 2016 Fahour agreed with Metcher to effect Metcher’s demand that Michael Newton be removed from his position and further “effected” Metcher’s contravention by removing Michael Newton from his position. At a factual level, I would not have found that Fahour agreed to effect Metcher’s demand that Michael Newton be removed because I have found that no such demand was made. However, I will, for current purposes, assume that I should have made such a finding. I will also proceed on the basis that Fahour’s preparedness to cancel Project Dove may be characterised as Fahour agreeing to Metcher’s demand that that be done.

187    Michael Newton’s contentions on accessorial liability must be rejected. They are founded upon a misunderstanding of the particular contraventions said to have been committed by Metcher and when those contraventions were complete.

188    The assumed contraventions in question are contraventions committed by Metcher making threats in his conversation with Fahour on 5 February 2016. On the assumption that those threats were made and made with the state of mind requirements of ss 348 and 355, the contraventions of those provisions were complete the moment that the threats were uttered. The contraventions of those provisions do not require any further or later conduct or consequence. As Buchanan J (with whom Siopis J agreed) said in Esso-FC at [180] in relation to s 343 “the nub of s 343 is that it is not necessary to wait until the action takes its toll and has overborn the will of the target”. As I said about that same provision in McCorkell at [227] by reference to the Explanatory Memorandum to the Fair Work Bill, the prohibition applies irrespective of whether the action taken to coerce another person is effective or not, the focus of s 343 is upon the intent and reason for action of an alleged offender. Those observations are equally applicable to ss 348 and 355.

189    All of the conduct of Fahour relied upon by Michael Newton for demonstrating that Fahour and APC were “involved in” Metcher’s assumed contraventions (ie succumbing to Metcher’s coercion, appeasing Metcher, agreeing to Metcher’s demands and affecting them) occurred after the threats were uttered and the contraventions were complete. There is no suggestion, let alone evidence, that Fahour was “involved in” the uttering of the threats. There is no evidence that Fahour was implicated in, consented to or concurred in or had a practical connection with the uttering of the threats to him by Metcher: see Ezy Accounting 123 Pty Ltd v Fair Work Ombudsman [2018] FCAFC 134 at [13] (Flick, Bromberg and O’Callaghan JJ); Fair Work Ombudsman v Priority Matters Pty Ltd [2017] FCA 833 at [116]-[119] (Flick J). The APC respondents were correct to contend that they could only have conspired to affect the contraventions if Fahour had agreed with Metcher in advance for Metcher to threaten Fahour.

190    The APC respondents are also right to contend that a fundamental defect underlying the approach to the construction of s 550 of the FW Act taken by Michael Newton is the characterisation of himself as being the “victim” or the “target” of the contraventions. It was the APC respondents who were subjected to the assumed contravening conduct. It was their capacity to engage in “industrial activity” and their capacity to allocate duties and responsibilities to a particular person that ss 348 and 355 sought to protect. Those provisions prohibit conduct which is likely to have the effect of denying or diminishing those protections and thereby victimising the person the provision seeks to benefit. A construction of s 550 of the FW Act which imposes accessorial liability upon the very person sought to be protected by a statutory prohibition, for having succumbed to the prohibited conduct, is most obviously unattractive. Michael Newton’s contentions completely ignored the fact that no such consequence could have been intended. Those contentions must be rejected.

section 340 claim – removal decision

Relevant Legislation and Legal Principles

191    Section 340 of the FW Act is in the following terms:

340 Protection

(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.

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

192    The term “workplace right” is defined in s 341 of the FW Act and relevantly includes an entitlement to the benefit of or having a role or responsibility under a workplace law. The definition of “adverse action” is provided in s 342. Relevant for present purposes, the definition includes at item 1 of s 342, the employer:

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

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

193    The nexus in s 340(1) between the prohibition on taking adverse action and the holding or exercise of a workplace right is found in the word “because”.  As is well established on the authorities, that nexus will be satisfied and therefore s 340(1) will be contravened, where the holding or exercise by a person of a workplace right was a substantial and operative reason for the adverse action taken against that person: Short v Ambulance Victoria [2015] FCAFC 55, at [55]. At [54]-[56] of Short Dowsett, Bromberg and Murphy JJ said this:

[54]    When an employee alleges that an employer has taken action against him or her because the employee exercised a workplace right s 361 casts the onus on the employer to ‘prove otherwise’. Under s 360, while there may be multiple reasons for an employer to have taken the adverse action, the employer takes action for a prohibited reason if the reasons for the action include that reason. The rationale for the presumption was explained by Mason J in General Motors Holden Pty Ltd v Bowling (1976) 12 ALR 605 at 617 per Mason J as being to throw on to the employer the onus of proving that which lies peculiarly within its own knowledge (cited with approval in Board of Bendigo Regional Institute of Technical and Further Education v Barclay (2012) 248 CLR 500 at [50] (French CJ and Crennan J)).

[55]    Where adverse action is taken by one person against another, the task of a court in a proceeding alleging contravention of s 340 or s 351 is to determine why the person took the adverse action and to ask whether it was for a prohibited reason or reasons which included a prohibited reason (Barclay at [5], [44] per French CJ and Crennan J). The question is whether a prohibited reason was a ‘substantial and operative’ reason for the respondent’s action (Barclay at [104] per Gummow and Hayne JJ, see also [59] per French CJ and Crennan J). The relevant inquiry is therefore into the ‘particular reason’ of the decision-maker for taking action (Barclay at [42] per French CJ and Crennan J, [102] per Gummow and Hayne JJ), which is a determination of fact to be made by the court taking account of all the facts and circumstances of the case and available inferences (Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd (2014) 88 ALJR 980 at [7] per French CJ and Kiefel J, Barclay at [45] per French CJ and Crennan J, [79] per Gummow and Hayne JJ).

[56]    To displace the presumption created by s 361 in light of the effect of s 360, the respondent must prove that its conduct was not motivated in whole or in part by the prohibited reason alleged. A failure to displace the presumption enables the allegation by an applicant of adverse action for a prohibited reason to stand as sufficient proof of that fact: Davids Distribution Pty Ltd v National Union of Workers (1991) 91 FCR 463 at [109] per Wilcox and Cooper JJ.

194    As I said in McCorkell at [158] by reference to the observations made by Gray J in National Tertiary Education Union v Royal Melbourne Institute of Technology [2013] FCA 451 at [20], “what the party seeking to rebut the presumption must do is to establish on the balance of probabilities that the alleged improper reason was not a reason for taking the action.”

195    Michael Newton alleged that the Removal decision constituted adverse action and that Fahour made that decision for the reason, or for reasons that include the reason, that Michael Newton had a “workplace right” namely, that (relying on s 341(1)(a) of the FW Act) he was entitled to the benefit of a workplace law being s 19(2)(a) (a likely intended reference to s 19(1)(a)) of the Work Health and Safety Act 2011 (Cth) (“WHS Act”). Michael Newton also pleaded (again relying on s 341(1)(a)) that he had a role or responsibility under s 28 of the WHS Act, but reliance on that matter was not pressed.

196    Section 19(1)(a) of the WHS Act provides that an employee has a right to a safe working environment. Relevantly it states that a person conducting a business or undertaking must ensure, so far as is reasonably practicable, the health and safety of workers engaged by that person while they are at work in the business or undertaking.

Whether the Removal Decision Constituted Adverse Action

197    Michael Newton bears the onus of establishing that adverse action was taken against him by APC. He has discharged that onus. I am satisfied, despite APC’s denial, that the decision to remove Michael Newton from his position altered Michael Newton’s position to his prejudice within the meaning of that part of the definition of adverse action provided by Item 1(c) of s 342(1) of the FW Act. The prejudice suffered included loss of security in employment: Patrick Stevedores Operations No 2 Pty Ltd v Maritime Union of Australia (1998) 195 CLR 1 at [4] (Brennan CJ, McHugh, Gummow, Kirby and Hayne JJ), as later events demonstrated. In being removed from a position in which he was exercising high level skills and expertise in his chosen field of endeavour, Michael Newton was also denied non-pecuniary benefits (Maritime Union of Australia v Fair Work Ombudsman (2016) 247 FCR 154 at [22]-[24], Tracey and Buchanan JJ, and at [63]-[66] Bromberg J) associated with working in the position in which he was contracted to work in. As, for reasons later discussed, the Removal decision involved a breach of Michael Newton’s contract of employment, Michael Newton was also injured in his employment within the meaning of Item 1(b) of s 342(1) (Patrick Stevedores at [4]).

Workplace Right

198    I am also satisfied that Michael Newton had the workplace right he contended for. The WHS is a “workplace law” within the meaning of s 341(1)(a) and Michael Newton was entitled to the benefit of s 19(1)(a) of the WHS Act.

State of Mind Element

199    I then turn to the state of mind element that constitutes another necessary ingredient of a contravention of s 340 of the FW Act. Section 361(1) has application. The relevant principles have already been set out. Michael Newton’s SFASoC made the allegation necessary to engage s 361(1) – he alleged that Fahour made the Removal decision for reasons that included the reason that Michael Newton was entitled “pursuant to s 19[1](a) of the WHS Act, to be provided with a working environment that was, so far as reasonably practicable, without risks to his health and safety”.

200    In relation to the removal decision, Fahour gave the following evidence:

When you made the decision to ask Ms Walsh to have [Michael] Newton stepped aside from his role, was it any part of your reasoning that [Michael] Newton was entitled to benefits under the [WHS Act]?---No.

Was it any part of your reasoning that [Michael] Newton was entitled to be provided with a working environment that was, so far as practicable, without risks to health and safety?---I wasn’t thinking about that. I was thinking about just giving him something useful to do and where he could be out of any harm’s way of any emotional or email abuse, and I could do this review independently without interference.

And was it any part of your reasoning in making the decision we’ve been talking about that [Michael] Newton, as a supervisor and manager, had himself some roles and responsibilities under the [WHS Act], including the obligation to take reasonable care for his own health and safety and for the health and safety of others?---No.

201    By that evidence APC rebutted the presumption which pursuant to s 361(1) would otherwise have applied. It was unpersuasively submitted that Fahour’s evidence was equivocal. Beyond that faintly put contention, Michael Newton’s submissions made no real attempt to persuade me that Fahour’s evidence should not be accepted. Instead, Michael Newton contended that Fahour had a different reason for removing Michael Newton from the reason alleged in the SFASoC. It was said that Michael Newton was removed from his position because “APC had no means by which it could meet its statutory duty to its employees under s 19 of the [WHS Act] other than removing them from any function that would bring them into contact with [Metcher]”.

202    That proposition is completely at odds with the pleaded case. The pleaded case relied upon the bizarre proposition that Michael Newton was removed so as to deny him his entitlement to a safe workplace. The alternative proposition is that he was removed to protect him or, in other words, to provide him with a safe workplace. That the alternative proposition was put, does no more than highlight the lack of any substantive merit in the case as pleaded.

203    I have already expressed my doubt that the reason for Michael Newton’s removal from his position had anything much to do with his welfare. However, a finding to that effect is not necessary to dispose of this claim. It is sufficient for me to record that I am not satisfied that the reason for Michael Newton being removed from his position was the reason alleged by Michael Newton in the SFASoC. I have reached that view on the assumption favourable to Michael Newton that the second pre-condition to the engagement of s 361(1) (see [38]-[40] above) was met. I should not, however, be thought to have accepted that the connection between the adverse action and the prohibited reason alleged was not so remote as to be fanciful.

204    For those reasons, the claim that the Removal decision constituted a contravention of s 340 of the FW Act must be rejected.

contractual claims

205    It is convenient to set out an outline of the relevant events that occurred between 5 February 2016 and the termination of Michael Newton’s employment on 11 August 2016. It is also convenient that I divide that time into three distinct periods. To the extent necessary, a more detailed discussion of particular events will be given later.

206    In a meeting with Walsh and Blee at approximately 5.30pm on 5 February 2016, Michael Newton was informed that Project Dove would be cancelled and told that he was removed from his position as National Compensation Manager. From that time through to 27 April 2016 (“first period”), Michael Newton attended work and undertook a range of minor administrative tasks at the direction of Blee and Bass.

207    On 21 April 2016, Michael Newton attended a meeting with Darryl Newton and Walsh where he was presented with a position description for the position of Manager Injury Management Strategy (“MIMS position”). On the morning of 26 April 2016 Michael Newton met with Roode to discuss the MIMS position. At a team meeting later that day Darryl Newton and Walsh announced that Michael Newton would take on the MIMS position. Whether Michael Newton actually took up this position will be further discussed below. On the next day (27 April 2016) at approximately 5.30pm, Michael Newton was directed by Roode that he was being sent home and that APC required that he be medically cleared before he could return to work. At that point, what I will characterise as the second period (“second period”) commenced. That period extended until 20 June 2016 when APC’s requirement that Michael Newton undertake a medical assessment was withdrawn. In this second period, Michael Newton did not perform any work at APC. Most of his interaction with APC concerned communications about whether he should, and the basis upon which he should, be required to undergo a medical assessment. The direction given for Michael Newton not to perform duties until he had obtained a medical clearance is the subject of Michael Newton’s statutory and contractual claim that he was unlawfully required to take “garden leave”.

208    A third relevant period followed from a discussion between Michael Newton and Darryl Newton on 26 May 2016. It was largely in consequence of that discussion that, on 20 June 2016, APC’s requirement for a medical clearance was removed and on that day three potential roles that Michael Newton “may perform upon his return to work” were proposed by APC for Michael Newton’s consideration. Those roles were Manager, Business Infrastructure and Integration (“MBII position”); Manger, People Framework Strategy (“MPFS position”); and Manager, Future Workforce Planning and Analytics (“MFWPA position”). What I characterise as the “third period” commenced on the making of that proposal and ended with the termination of Michael Newton’s employment on 11 August 2016. In this period, Michael Newton did not perform any work. His interaction with APC involved various communications about the suitability of the three positions under discussion.

209    On 27 July 2016, APC directed that Michael Newton return to work on 1 August 2016 (later extended to 3 August 2016) to perform the MBII position. Michael Newton did not attend for work on 3 August 2016. On 4 August 2016, Michael Newton was informed that by reason of his failure to comply with the direction that he attend for work on 3 August 2016, APC was considering terminating his employment. By letter dated 11 August 2016, APC informed Michael Newton that his employment with APC was terminated effective immediately.

210    It is convenient that I now turn to identify those clauses of relevance in Michael Newton’s contract of employment with APC (“contract”), the alleged breaches of that contract and determine any issues between the parties as to how those clauses should be construed. I will then turn to consider further the facts relevant to the contractual breaches alleged.

211    Clause 1 is headed “Your role” and relevantly provides:

1.1 Position

You will be employed in the position of National Compensation Manager on the terms and conditions set out in this document (Contract) from 24 March 2014 (Commencement Date).

1.2 Probationary period

...

1.3    Change of position

(a)    [APC] may require You to occupy a position different from the position referred to at clause 1.1 of this Contract.

(b)     Any such position must be suitable for You, having regard to Your skills, training and experience.

(c)    Unless this Contract is replaced by another agreement, the terms and conditions set out in this Contract will continue to apply to your employment even if Your position is changed in accordance with this clause 1.3.

1.4    Duties and changes to duties

(a)     You will faithfully and diligently perform, to the best of your abilities and knowledge, such duties as [APC] may from time to time assign to You.

(b)    You are required to achieve a satisfactory level of performance of your duties as measured against agreed performance objectives.

   (c)    [APC] may at any time change the duties assigned to You.

(d)     [APC] may only assign duties to you that are suitable for You, having regard to Your skills, training and experience.

(e)     Unless this Contract is replaced by another agreement, the terms and conditions set out in this Contract will continue to apply to your employment even if Your duties are changed in accordance with this clause 1.4.

1.5    Reporting lines and changes to reporting lines

    …

1.6    Location

    …

1.7    Change of location

    …

1.8    Employment Checks

Throughout Your employment in the position referred to in clause 1.1 or any subsequent or alternative position in accordance with clause 1.3, [APC] may require you to undergo medical, criminal, security, or character checks where [APC] determines it desirable or necessary to do so. It is an ongoing condition of your employment that:

(a)    You comply with any requirement to undergo a check; and

(b)     the results of any check are satisfactory to [APC]

212     Clause 10 is headed “Ending Your employment” and relevantly provides:

10.1    Employment ending on notice by [APC]

(a)    [APC] may terminate Your employment at any time by giving you 12 weeks’ notice.

(b)    Without limiting its rights under clause 10.3 or 10.1(a), [APC] may terminate Your employment under this clause if:

(i)    You contravene or fail to comply with the terms and conditions upon which You are employed, including, without limitation, the achievement of a satisfactory level of performance as measured against agreed performance objectives;

(ii)    in the reasonable opinion of [APC], You are unable to adequately and safely perform the inherent requirements of your position; or

   (iii)    Your position no longer exists.

(c)     [APC] may provide payment in lieu of all or part of this notice period.

10.2    Employment ending on notice by You

You may terminate your employment at any time by the provision of 12 weeks’ written notice to [APC].

10.3    Summary dismissal

    ...

10.4    Garden leave

(a)    During part or all of any period of notice of termination given by You or by [APC] or during any period in which [APC] is investigating any disciplinary issue involving you, [APC] may, at its sole discretion:

(i)    require you to perform only such duties as [APC] may determine or not to perform any duties at all;

(ii)    require you not to have any contact with any employees, customers or business associates of [APC] other than normal social contact; and/or

(iii)    exclude you from all or part of [APC’s] premises.

(b)    Your remuneration will not be withheld or reduced as a result of You complying with such directions.

213    Clause 13 is headed “General” and relevantly at cl 13.3 provides:

13.3    Rights cumulative

Except as expressly stated otherwise in this document, the rights of a party under this document are cumulative and are in addition to any other rights of that party.

214    There are two categories of breach pleaded in the SFASoC. The first is concerned with the Removal decision and asserts a breach of cll 1.1, 1.3 and 1.4. The second concerns the Garden leave decision and asserts a breach of cl 10.4.

Alleged Contractual Breach Relating to the Removal Decision

215    That Michael Newton was, with effect from 24 March 2014, employed by APC in the position of National Compensation Manager was admitted in the pleading of the APC respondents. The duties of the position of National Compensation Manager were set out in a document entitled “ROLE PROFILE (Proposed Only)” (“Role Profile”). It was not in contest that in the position of National Compensation Manager Michael Newton was expected to perform duties in accordance with the Role Profile.

216    The SFASoC alleged that cll 1.1, 1.3 and 1.4 of the contract were breached by APC by reason that, on 5 February 2016, Michael Newton was removed from his position of National Compensation Manager and that, upon being removed, Michael Newton was not offered an alternative position with APC, required by APC to fulfil the duties of another position, or assigned to alternative duties by APC. Read in the light of the particulars given of the breach, the pleading is to be understood as alleging a breach by reason of APC removing Michael Newton from his position of National Compensation Manager on 5 February 2016 without placing him into an alternative “suitable” position within the meaning of cl 1.3 of the contract.

217    That was essentially the way in which the breach was put and pursued at trial. There was no reliance placed on cl 1.4 of the contract and in so far as the SFASoC asserted a breach of that clause such a breach was not pressed.

218    The focus of Michael Newton’s submission was on cl 1.3 as encapsulated in the following contention made in written submission:

On 5 February 2016 when [Michael Newton] was removed from the position to which he had been appointed without being assigned to another position that was suitable for him having regard to his skills, training and experience in breach of cl 1.3.

219    Whilst the submission was never a model of clarity, as I understood it, Michael Newton maintained that under his contract he had a “dual right”. First (and pursuant to cl 1.1) a right to be employed in “the position under the contract”, that is the position of National Compensation Manager, and second a right to a “suitable” alternative position under cl 1.3(b) if he was removed from the position of National Compensation Manager.

220    Michael Newton’s case was really that APC had an obligation to employ him in either the position of National Compensation Manager or in an alternative but suitable position in accordance with clause 1.3(b). Michael Newton accepted that a reasonable period may be allowed for APC to move him from the National Compensation Manager position into an suitable alternative position without the contract being breached. He contended, however, that on 5 February 2016 he was removed from his position as National Compensation Manager and that thereafter, and in breach of the contract, he was not employed in either the National Compensation Manager position or a suitable alternative position.

221    Despite the lack of clarity in the way in which this part of Michael Newton’s case was pleaded and pressed, APC’s submissions indicate a sufficient appreciation of the case against it which it was being required to meet.

222    APC denied that cll 1.1 or 1.3 were breached. By its written submissions, APC contended that there was no breach because Michael Newton was offered a number of roles which were “suitable” positions within the meaning of cl 1.3, in particular the MBII position, a position that Michael Newton was initially directed to perform on 11 July 2016 but later altered to commence on 3 August 2016. APC contended that there is no temporal limitation imposed by cl 1.3 but, in the alternative, if a temporal limitation existed it required only that a suitable alternative position be offered within a reasonable period of time from Michael Newton’s removal from his position as National Compensation Manager.

223    APC’s written submissions largely proceeded on an implicit assumption that save for allowing for a reasonable period of time between positions, cl 1 of the contract imposed upon APC an obligation to employ Michael Newton in either the National Compensation Manager position or in a suitable alternative position. However, somewhat inconsistently with its written submission, in oral argument, APC contended that cl 1.3 conferred a right upon APC but did not confer any right upon Michael Newton and that cl 1.3 did not oblige it to provide Michael Newton with an alternative position at all once he was removed from the National Compensation Manager position, but merely required that if and when Michael Newton was required to take up an alternative position, that position had to be a suitable alternative position. APC contended that until a suitable alternative position was provided to Michael Newton, at common law, it was entitled to have Michael Newton carry out various tasks without providing Michael Newton with any position at all. That submission seems to have been put in addition to the contention that APC was entitled under the contract, to a reasonable period of time in which to place Michael Newton in a suitable alternative position.

224    I do not accept that the contract is to be construed as APC contended that it should be. Nor do I construe cl 1 entirely consistently with the contentions made by Michael Newton.

225    Clauses 1.1, 1.3 and 1.4 deal with the position that Michael Newton must be employed in and its duties. The position that Michael Newton must be employed in on commencement of the employment is specified as that of National Compensation Manager. The contract contemplates that Michael Newton will continue to be employed in that position (referred to at cl 1.3(c) as “Your Position”), unless a change of position is affected in accordance with cl 1.3. Under the heading “Change of Position”, cl 1.3 provides APC with the capacity to require Michael Newton “to occupy a position different from” the National Compensation Manager position but restricts the exercise of that right by requiring that the alternative position “must be suitable for You, having regard to Your skills, training and experience”.

226    That restriction is directed at protecting Michael Newton’s interests. It is not a restriction beneficial to APC. Although cl 1.3 provides APC with a right to change Michael Newton’s position, it nevertheless imposes a negative or restrictive stipulation upon the exercise of that right. A failure to comply with a negative or restrictive stipulation in a clause otherwise permissive is capable of constituting a contravention of the clause: see as an example Construction, Forestry, Maritime, Mining and Energy Union v Hay Point Services Pty Ltd [2018] FCAFC 182 at [12]-[13] (Reeves, Bromberg and O’Callaghan JJ).

227    However, in my view, cl 1.3 must be read with cl 1.1. When read together, I consider that the obligation imposed upon APC is to be found in cl 1.1. That obligation is to employ Michael Newton in the position of National Compensation Manager unless APC is relieved of that obligation, if and when, it affects a change to Michael Newton’s position in accordance with cl 1.3. Put another way, whilst Michael Newton is not employed in the National Compensation Manager position, APC will be in breach of cl 1.1 unless it has availed itself of the capacity to move him to a suitable alternative position in accordance with cl 1.3.

228    APC may be correct in its submission that cl 1.3 is directed at a right conferred upon it and that it is not obliged under cl 1.3 to do anything at all. However, that acceptance does not relieve APC of its obligation under cl 1.1 to have employed Michael Newton in the position of National Compensation Manager unless and until it moved him to a suitable alternative position in accordance with cl 1.3.

229    I would accept that cl 1 should be construed as permitting APC some reasonable time to move Michael Newton from the National Compensation Manager position into a new position which accords with the requirements of cl 1.3, without APC being in breach of the contract. Clause 1 should be construed to operate in the practical manner as was obviously intended. The possibility of a necessary interregnum between roles must have been contemplated to address practical considerations such as a shift of locations to the new role or perhaps the need for the occupant of the new position to vacate.

230    However, the clause is addressing an exchange of the National Compensation Manager position for an alternative position in circumstances where APC is requiring Michael Newton to occupy the alternative position. It contemplates that the alternative position be identified and, practical considerations aside, that it be available in the exchange which cl 1.3 permits APC to effectuate. I do not construe cl 1 as authorising the removal of Michael Newton from his position per se. The capacity given to APC to remove Michael Newton from his contracted position, is part and parcel of a single process in which Michael Newton’s existing position is replaced with a different position which accords with the suitability requirement in cl 1.3(b).

231    The obligation imposed on APC by cl 1.1 is not suspended where Michael Newton is removed from his position as National Compensation Manager on the basis that some unidentified suitable position may be found for him at some indeterminate time in the future. That, as I will shortly explain, is what I consider occurred in this case.

232    It is first necessary to address two matters before returning to the facts. First, there is a distinction to be drawn between APC’s power to direct Michael Newton not to perform his duties in the position of National Compensation Manager and its power to remove him from that position. That distinction was not observed in the submissions made by APC that sought to justify the interregnum inflicted upon Michael Newton based upon APC’s asserted common law right not to have Michael Newton carry out his duties as National Compensation Manager and perform other duties instead.

233    Second, save for the exception allowed for by cl 1.3, the obligation upon APC imposed by cl 1.1 to employ Michael Newton in the position of National Compensation Manager is a continuing obligation. On-going conduct in breach of cl 1.1 would therefore constitute a continuing breach – a breach which subsists so long as the requirements of cl 1.1 remain unsatisfied. An obligation to employ an employee in the contracted position was held to be a continuing obligation in Norwest Holst Group Administration Ltd v Harrison [1985] ICR 668 at 681 (Neil LJ). In Mann v Capital Territory Health Commission (1982) 148 CLR 97, a failure to employ the services of an employee in a senior capacity as a general surgeon was regarded as a “continuing wrong”: see at 100-101 (Stephen, Wilson and Brennan JJ).

234    The SFASoC does not expressly plead a continuing breach of the contract. Strictly read the pleading suggests that all that is alleged is a single breach on 5 February 2016 consequent upon Michael Newton’s removal from his position as National Compensation Manager. The case was run more broadly and was the subject of some complaint by the APC respondents but not any formal objection. No practical unfairness was either asserted or is apparent if Michael Newton’s case is permitted to be made on the basis of a continuing breach rather than a single breach on 5 February 2016. Including because the result would be the same in either case, I will proceed on the correct characterisation of the nature of the breach in question.

First Period

235    Michael Newton’s evidence was that at a meeting with Walsh and Blee at approximately 5.30pm on 5 February 2016, Walsh told him that he was removed from his role as National Compensation Manager at the request of Fahour. He deposed that Walsh had indicated that he would be looked after and that he would be put into a different role, that that role had yet to be determined but that the role “sat with Peter Bass”. He deposed that Walsh told him that he could be in that other role for one or more months and that Walsh could not indicate how many months. Michael Newton also deposed that Walsh and Blee spoke about replacing him, discussed a contractor being brought in to fill his position and also discussed “a direct report stepping up into my position”. In a handwritten note made by Michael Newton of the meeting, Michael Newton recorded that “[a]s a directive of [Fahour], [Walsh] withdrew me from my position and the [sic] proposed a role with [Bass] in Operations…”

236    That evidence includes the suggestion that the removal of Michael Newton from his position was represented to him as a temporary removal. There is other evidence of correspondence sent by Blee on 7 February 2016 and 9 February 2016 that suggests that Blee regarded the change to be temporary and that Michael Newton was joining the Mail Network Leadership Team managed by Bass for two months, which she described as a short-term secondment. Blee directed that in that period, the APC employees who reported to Michael Newton report to her. On 8 February 2016, Michael Newton was asked to remove himself from all his work and pass it on to his direct reports. There is no evidence that after 5 February 2016 Michael Newton undertook any of the duties of the National Compensation Manager position.

237    The evidence is best characterised as establishing that on 5 February 2016, Michael Newton was removed as the occupant of the position of National Compensation Manager albeit that Blee and Walsh may have, at that time, regarded the removal as temporary. The unchallenged evidence of Michael Newton as to what he was told by Walsh at the meeting of 5 February 2016 and her characterisation of the nature of the change being effectuated, persuades me that Michael Newton was not merely directed to temporarily not perform the duties of his position but, instead, was removed from that position in a manner sufficient to meet the contractual description of no longer being “employed in the position of National Compensation Manager”.

238    It is not in contest that in what I have described as the first period (5 February 2016-27 April 2016), Michael Newton was not occupying a “suitable” alternative position in accordance with cl 1.3(b) of the contract. I hold that in that first period, APC’s conduct constituted a continuing breach of its obligation under cl 1.1 of the contract to employ Michael Newton in the position of National Compensation Manager.

Second Period

239    What I have described as the second period commenced on 26 April 2016 when at a meeting attended by over 100 employees about a proposed restructure of APC’s workers’ compensation unit, it was announced by Walsh and Darryl Newton that Michael Newton would take on the MIMS position. Given that it was not in contest that the MIMS position was a “suitable” position for Michael Newton within the meaning of cl 1.3(b) of the contract, a question arises as to whether on or about 26 April 2016, Michael Newton occupied that position thereby ending the continuing breach of cl 1.1 of the contract by APC.

240    A discussion of the events here in question should commence with some background. In the course of what I have referred to as the first period, Michael Newton made a number of attempts to have APC provide him with a new role. At a meeting with Blee on 22 March 2016 he asked that he be provided with options for either returning to the position of National Compensation Manager or undertaking other roles within APC that were commensurate with his skills and experience. It appears that as a result of that request a meeting was organised for Michael Newton with Walsh and Darryl Newton on 21 April 2016. The evidence is not clear, but it would appear that either at that meeting or prior to that meeting, Michael Newton was informed that he would not be able to return to the National Compensation Manager position. At the meeting with Walsh and Darryl Newton, he was presented with a position description for the MIMS position. He asked for time to read the position description and have a discussion with Roode. He met with Roode on the morning of 26 April 2016 where he raised some concerns about the conditions of employment in the MIMS position. He suggested a further meeting with Roode be held by 28 April 2016 “so that all parties can move forward”. It would appear, that later that same day and without any prior consultation with or notice to Michael Newton, it was announced at the meeting to which I have already referred that Michael Newton would be taking on the MIMS position.

241    On the following day, 27 April 2016 Michael Newton was verbally directed by Roode that he was being sent home and that APC required that he be medically cleared before he could return to work. That was confirmed by a letter dated 29 April 2016 in which Michael Newton was informed by Roode that:

As I advised on Wednesday, we have received a complaint that has specifically raised concerns that you have been under a level of work stress that has placed your health and wellbeing at risk. While I accept that you are of the view that this is not the case and you are able to continue work, given the seriousness of the allegations, we are of the view that we have a duty of care to obtain independent medical opinion confirming your fitness for duty.

242    Roode requested Michael Newton to refrain from contacting anyone at APC or accessing his emails. He also stated that he would be in touch again with Michael Newton shortly with details of medical appointments he was to attend.

243    Darryl Newton’s evidence was equivocal as to whether Michael Newton had been appointed into the MIMS position. At times he referred to Michael Newton having been “appointed” into that position on 26 April 2016 in the expectation that he would start work as soon as possible. However, when asked whether Michael Newton ever commenced in the role, Darryl Newton indicated that he never did. When it was suggested to him that Michael Newton was “appointed” into the position on 26 April 2016, Darryl Newton said “[a]ppointed is an interesting expression. We announced Michael into that role”. He then agreed that Michael Newton “never fulfilled the role”. Michael Newton was adamant that he never took on the MIMS position.

244    In the terms utilised by cl 1.3(a) I am not satisfied that APC did “require [Michael Newton] to occupy” the MIMS position. I am satisfied therefore that APC’s breach of cl 1.1 continued throughout the course of the second period.

Third Period

245    It is not necessary for current purposes to describe in any detail the interactions between Michael Newton and APC (over some two months) about APC’s requirement that Michael Newton undergo medical examinations and Michael Newton’s resistance to that course. It is sufficient to say that the requirement for Michael Newton to undertake medical examinations arose from a direction made by Fahour. Fahour asserted that the direction was instigated by the Blee complaint on 16 April 2016 in which Blee complained that her team had been subjected to constant harassment and bullying by Metcher and noted that, as a result, a number of members of her team, including herself, were under the care of medical professionals. Blee complained that APC’s acceptance of the behaviour amounted to “company sanctioned bullying”.

246    Having been sent home on 27 April 2016, it was not until 9 May 2016 that Roode forwarded to Michael Newton drafts of letters that were proposed be sent to Michael Newton’s treating general practitioner and to other medical practitioners in relation to obtaining medical assessments and reports. That correspondence from Roode only came after Michael Newton had prompted Roode to deal with the situation. Michael Newton took issue with the wording of the draft letters and further issue with later drafts of those letters through to about 20 May 2016.

247    In correspondence of 23 May 2016, Michael Newton wrote to Roode and again communicated his discontent with further revised draft letters and requested further revisions. He suggested that APC was not engaged in the process of returning him to employment. He also stated that he considered the request for him to attend a medical examination unreasonable and unlawful. He requested that he be provided with a copy of the Blee complaint. Michael Newton deposed that he was unhappy with the medical clearance request and stated that it was his impression that he was being put through the first process of being removed from his employment.

248    Michael Newton’s resistance was not without its justification. There was no foundation in the evidence that Michael Newton’s psychological wellbeing was affected by his prior interactions with Metcher or that he was otherwise unwell. Some of the other employees who had also been on Blee’s team who had extensive involvement with Metcher were not directed not to work. Additionally on 13 May 2016 Blee wrote an email to which Newton was copied in apologising that he had been caught up in “this whole mess” and stated that at no point in her complaint did she raise a concern about Michael Newton’s fitness for duty, although she noted that she had said to APC that she felt that Michael Newton (and others) were under inappropriate levels of stress because of APC’s expectation that they tolerate Metcher’s behaviour.

249    On 26 May 2016, Darryl Newton telephoned Michael Newton. This was a long conversation and, again, it is not necessary to set it out in detail. It is sufficient to say that Darryl Newton contacted Michael Newton to try and bring things to a head including to determine whether or not Michael Newton would continue to be employed by APC. Although there is some suggestion in the evidence that Darryl Newton may have commenced the conversation with the intention of ending the employment relationship between Michael Newton and APC, I accept that Darryl Newton was by no means fixed in the pursuance of that course. He was however as he himself said, intent on having a discussion with Michael Newton about whether, being realistic, there was a job for Michael Newton at APC. The conversation led to a without prejudice meeting held on 6 June 2016 in which Darryl Newton, Walsh, Michael Newton and Michael Newton’s lawyer (“Maley”) participated, and a further without prejudice meeting on 15 June between Darryl Newton, Macdonald and Maley.

250    On 20 June 2016, Mcdonald sent a letter to Maley in relation to Michael Newton’s employment. In that letter APC’s requirement that Michael Newton be medically assessed was removed. That was said to have occurred on the basis of Michael Newton’s assurance that he was physically and mentally fit to work and APC’s desire to get Michael Newton back into the workplace. Mcdonald’s letter enclosed three position descriptions for Michael Newton which had been discussed with Maley at the meeting on 15 June 2016. Those positions were for the:

    MBII position;

    MPFS position; and

    MFWPA position.

251    On 4 July 2016 Macdonald sent a letter to Maley. In that letter Macdonald noted that Darryl Newton had not received a response from Michael Newton indicating a preference for any of the proposed roles. Macdonald reiterated APC’s position that the roles were “appropriate for Michael Newton’s experience and skill set” and asked for a response from Michael Newton by 5pm on 8 July 2016. The letter stated that if Michael Newton did not respond by that date that he would be appointed to one of the proposed roles and would be required to return to work from 18 July 2016.

252    By letter of 8 July 2016, Maley responded to APC’s letter; Maley noted that he had reviewed each of the proposed roles and that they did “not appear to us to be suitable for Michael [Newton], having regard to his skills, training and experience.” Maley specified the basis upon which it was asserted that the positions were not suitable.

253    Maley proposed an alternative solution; that Michael Newton be returned to the National Compensation Manager position, and that if the conduct of Metcher remained problematic that APC should make an application under the FW Act anti-bullying provisions. If it were not possible to return Michael Newton to his previous positon, Maley proposed that Michael Newton should be placed in the MIMS position.

254    On 11 July 2016, Macdonald sent two letters to Maley regarding Michael Newton’s employment. In the first letter APC noted its disagreement with the assertion that the roles were not suitable and stated “we maintain that each of these roles are appropriate: they are all senior, strategic roles and are roles Michael [Newton] would be capable of performing given his training, skill-set and experience.” It was noted (presumably because Fahour had so directed) that APC had made a “business decision” not to return Michael Newton to the workers’ compensation unit and instead that Michael Newton had been appointed to the MBII position and was required to return to work on 18 July 2016. The second letter largely reiterated statements made in the first letter with the additional comment that should Michael Newton refuse to return to work in the MBII position that APC is available to attend a without prejudice meeting with Maley and Michael Newton to discuss the basis upon which his employment will end.

255    Maley wrote to Macdonald on 13 July 2016 seeking a letter setting out the basis and reasoning for the “business decision” not to place Michael Newton in any role in the workers’ compensation unit.

256    In further correspondence dated 14 July 2016, APC confirmed that the decision not to return Michael Newton to the workers’ compensation unit was made because it was “no longer tenable” due to the tensions between Michael Newton and a key external stakeholder and due to APC’s concerns about the ongoing impact of this tension on Michael Newton’s wellbeing.

257    Further correspondence ensued between Macdonald and Maley as a result of which APC made a number of changes to the MBII position description. By letter dated 27 July 2016, APC noted:

in light of the concerns you have raised, and to give Michael [Newton] some comfort, we have made some adjustments to the position description...to more accurately reflect the skills, experience and training required for the role.

Although we consider that Michael [Newton] has the skills, experience and training required for this role, we anticipate that it may take some time to bring Michael [Newton] up to speed on the specific requirements of the role. We confirm that this will be taken into account when assessing Michael [Newton’s] performance in the role.

258    The letter stated that Michael Newton was expected to return to work on 1 August 2016. The letter attached an updated position description for the MBII position. Key changes included removal of the requirement for “data manipulation and analysis” skills and removal of design and management requirements in relation to database and technology. The position description also changed the required technical and professional skills to only a tertiary level qualification in business or a related discipline.

259    Maley sent an email to Macdonald on 28 July 2016 in response to the updated position description. Maley stated that the position being offered was different to that previously offered, and requested until 10 August 2016 to consider the “new” position.

260    Macdonald responded by email on 29 July 2016. He stated that “ample opportunity” had been provided to Michael Newton to decide whether to return to work, that the position was not a “new position” and that as a “gesture of good will” the return date would be extended to 3 August 2016.

261    On 3 August 2016 Michael Newton did not attend work in accordance with the direction made by APC.

262    On 4 August 2016, APC sent correspondence to Michael Newton. The correspondence asserted that the decision to appoint Michael Newton to the MBII position “was made in accordance with clause 1.3 of your 13 March 2014 employment contract, which allows [APC] to appoint you to another position suitable for you having regard to your skills, training and experience”. The letter referred to APC’s direction that Michael Newton return to work to perform the MBII position and stated that:

Given your failure to comply with this direction to attend work on 3 August 2016, we are now considering terminating your employment with [APC], and we propose to make a final decision by early next week.

263    By letter of 11 August 2016, on behalf of APC, Darryl Newton informed Michael Newton that his employment was “being terminated due to your failure to comply with a lawful and reasonable direction, namely that you attend for work on 3 August 2016 in the [MBII position]”. Darryl Newton further stated that:

[a]lthough we are of the view that under clause 10.3(a) of your employment contract, we are entitled to summarily terminate your employment on the basis of your failure to comply with this lawful and reasonable direction…we have made the decision to terminate your employment under clause 10.1(a), with pay in lieu of notice.

264    As will be apparent from the facts set out above, APC appointed Michael Newton to the MBII position on 11 July 2016 and required him to commence work in that positon initially by 18 July 2016 but ultimately the commencement date was extended to 3 August 2016. If I had found that the MBII position was a “suitable” position within the meaning of cl 1.3(b) of the contract, I would have held that APC’s continuing breach of cl 1.1 extended to 11 July 2016. However, for the reasons I will now address, I do not consider that the MBII position was a “suitable position”. I hold, therefore, that APC’s continuing breach of cl 1.1 extended through to the termination of the contract on 11 August 2016.

Suitability of alternative positions proposed/offered

265    It is not uncommon for contracts of employment and industrial instruments such as enterprise agreements made under the FW Act to allow for an employer to shift an employee into a different position but at the same time protect the employee by requiring that the new position be suitable or a suitable alternative position. A contractual provision of that kind must be construed according to its own terms and that is the approach I will adopt in relation to cl 1.3(b). Nevertheless, it is instructive to examine some of the authorities and the approach taken to exercises similar to that with which I am here confronted.

266    In CMP Manufacturing Pty Ltd v Barbieri [2018] FCA 622 at [41], a contractual provision required that on the redundancy of an existing position, an employee had to be offered “an alternative” to “your position”. I there determined that, read in context, an “alternative position…connotes a reciprocity or an equivalence in the exchange. A reciprocal position in the context in question would be a position with the same or similar characteristics to [the employee’s] existing position”. I observed that an assessment as to whether a position is an “alternative position” required an assessment of the nature and character of the existing position as well as the employee’s career expertise and experience. Further, that “[a]n assessment of whether the work and duties of one position is the same or similar in nature or character to the next, is likely to have both a quantitative and a qualitative dimension” (at [44]-[45]). This is essentially the approach taken by Harper and Tate JJA and Kyrou AJA in Gamboni v Bendigo and Adelaide Bank Ltd (2013) 39 VR 578 where, in assessing whether a new position offered to an employee was a “suitable alternative position” in accordance with the employer’s redundancy policy, their Honours made a qualitative and quantitative assessment of the attributes of the two positions. In particular, the Full Court compared the status and seniority of the positions, including the number of subordinates, supervisory responsibilities and access to business funds, and whether the work and skill sets required to carry out the new position were commensurate with those exercised by the employee in the former position. At [88], Kyrou AJA (with whom Harper and Tate JJA agreed) said, alluding to the managerial nature of the positions being compared:

[88]    The concept of ‘position’ in the present context includes at least the following features:

(a)    the nature of the work attached to the position;

(b)    the title that is associated with the position;

(c)    the status and seniority of the position;

(d)    the reporting lines associated with the position, including the number and seniority of the persons reporting to that position and the seniority of the superiors to whom that position reports; and

(e)    the level of autonomy associated with the position.

267    The comparison of positions made in Gamboni focused upon whether there was sufficient commonality between the “defining features of the work performed” (at [79]) in the respective positions. Important to the conclusion that the latter position was not a “suitable alternative position” was that when the attributes of the work required to be performed were compared, a major portion of the work required in the former position was not required in the latter position (see at [65]-[82]) in particular). This was a qualitative assessment in which the “work” compared involved a comparison of the skill and expertise required to perform the work of the respective positions.

268    Further, in assessing what a contractual position requiring suitability for an alternative position intends, it is helpful to bear in mind the settled principle that, as a general rule, a significant diminution in an employee’s remuneration, status or responsibility may constitute a repudiation of the contract in and of itself: see Whittaker v Unisys Australia Pty Ltd (2016) 26 VR 668 at [41] (Ross J) and Westen v Union des Assurances de Paris (1996) 88 IR 259 (Madgwick J).

269    Clause 1.3(b) of the contract provides that the different position that Michael Newton may be required to occupy “must be suitable for [Michael Newton] having regard to [Michael Newton’s] skills, training and experience”. Unlike Gamboni, where the criteria required assessing one position against another, the criteria in cl 1.3(b) is more personal to Michael Newton and calls for a comparison of the skills, training and experience held by him in his employment at APC and those called for by the alternative position. There is no subjective element in that criterion. The question is not whether Michael Newton regards a position to be suitable. Suitability is to be assessed objectively. Michael Newton’s skills, training and experience are the primary considerations which the clause intends should inform the assessment. Regard must be had to Michael Newton’s skills, training and experience, meaning that both the quality and extent of the skills, training or experience held or undertaken must be given weight in the assessment. Thus, if Michael Newton has high level management skills and experience managing a large team of employees, all other things being equal, a position that does not require that level of skill or experience is to be regarded as less suitable than a position that does.

270    The clause is not suggesting that a position is suitable simply because it is within Michael Newton’s skills and competence to perform the role. A position as a clerk is not a suitable position for a person with the skills, training and experience of a supervisor or manager simply because that person has the ability to perform the clerk’s role. If cl 1.3(b) was merely intended to empower APC to transfer Michael Newton into a position that he has the capacity to perform, the clause would not have used the phrase “suitable for You” as the controlling condition. A phrase like “within your skills, training and experience” might have been used in that case. What the clause calls for is a sufficient alignment or correspondence between the skills, training and experience held or undertaken by Michael Newton and the skills, training and experience required to perform the alternative position, to make the alternative position befitting or suitable for Michael Newton. It is in that sense that the “position must be suitable for [Michael Newton]”. The employment context suggests that a holistic and practical rather than a technical or formulaic assessment was intended.

271    Turning then to the requisite assessment, I will commence with what the evidence reveals about Michael Newton’s skills, training and experience. For most of 2016, Michael Newton was 45 years of age. He completed his Victorian Certificate of Education in 1989. He then obtained a Bachelor of Engineering and a Post Graduate Diploma in Occupational Health and Safety. He also obtained a Masters of Business Administration and a further Masters of Business in Industrial Relations and Human Resources. In 2016, Michael Newton commenced studies for a legal degree.

272    Utilising his engineering skills, from about 1993 Michael Newton worked as a metallurgical and then as a galvanising line operator for some 3 years at BHP. He then commenced work for Pacific Brands Ltd as the National Workers’ Compensation Manager. In the latter part of his seven years working for Pacific Brands Ltd, he also undertook a role as a Business Analyst. For a short period, a year or two, Michael Newton worked in Business Planning before returning to Pacific Brands Ltd in 2009 to the National Workers’ Compensation Manager role. In that role he managed five employees. He left Pacific Brands Ltd in 2014 to take up the position with APC as National Compensation Manager. He moved to APC including because APC was of the largest self-insurers for workers compensation. He referred to working for a self-insured employer as an aspect of the career he had had working at Pacific Brands Ltd.

273    In the position of National Compensation Manager, Michael Newton managed some 30 employees with 5 managers directly reporting to him. His day to day work in the position included liaising with Blee, attending to project work allocated to him and overseeing the work of his direct reports, in particular reviewing high risk worker’s compensation claims.

274    The skills, training and experience held by Michael Newton are reflected in the Role Profile for the position of National Compensation Manager. The evidence was that Michael Newton had performed well in the position of National Compensation Manager and I would infer that his skills and expertise were commensurate with those required by the Role Profile.

275    The Role Profile described the purpose of the National Compensation Manager position as including developing APC’s compensation strategy and developing the future compensation operating model by reviewing existing practices and processes and examining external best practice approaches, considering the broader APC operating model and determining efficiency opportunities. Michael Newton deposed that he had been able to draw on his past experience in the worker’s compensation field to fulfil that objective and in particular his experience working for a self-insurer. In this respect, Michael Newton deposed that he had conducted research examining the efficiency of other self-insurers and was able to offer suggestions for improvement to assist APC to effectively improve their claims management of workers’ compensation. As I understood it, much of that evidence related to the development by him of Project Dove.

276    In identifying its purpose, the Role Profile also referred to the need for the National Compensation Manager to lead the implementation of “the new compensation operating model by leading their team through the change process and ensuring the business is supportive of the new model”. Further, the National Compensation Manager was charged with ensuring the performance of the workers’ compensation unit including continuing to effectively manage APC’s compensation obligations, a responsibility stated to involve the maintenance of APC’s self-insurance licence by ensuring compliance with legislative requirements, providing specialist advice and guidance to business leaders and working in conjunction with the compensation team to contribute to mitigating workers’ compensation liability.

277    The Role Profile described the position’s “Major Accountabilities” as follows:

Provision of Compensation Expertise

•    Management of [APC’s] workers’ compensation function nationally.

•    Provide expert advice and guidance on the complex and high risk workers compensation related matters.

•    Provide senior management with detailed analysis of the cost of workplace injuries to the organisation, injury types and trends

•    Oversight and effectively manage the workers’ compensation national provision.

•    Ensure compliance with all policies, procedures, legislative and SRCC licensing requirements

•    Source and manage professional development for claims managers specifically relating to medical and legal knowledge

Strategy Execution & Customer

•    Accountable for the development of the future compensation strategy and operation model.

•    Investigating external best practices for managing the compensation function in other comparible [sic] organisations.

•    Take an enterprise wide approach to the management of compensation and the long term success of [APC].

•    Manage the change transition function from a state based team to a national function to meet the needs of the business.

Financial

•    Manage workers’ compensation provision and costs.

•    In conjunction with finance, develop a business case for the new operating model.

Leadership & Organisation

•    Lead a high performing team with behaviours aligned to Culture Pillars

•    Ensuring the people are committed and accepting of change and there is stakeholder buy-in to facilitate change.

•    Facilitate the people strategy and planning process for the BU in partnership with HR Business Partners, Business Leaders, other COE teams and Corporate strategy

•    Coach & monitor performance of direct reports

•    Actively manage safety, health and wellbeing of team

278    Two aspects of what are described in the Role Profile as “Person Specification” are worthy of detailed consideration. Under the subheading “Essential Experience” the Role Profile called for:

•    Experience in the management [sic] a high volume workers’ compensation claims unit

•    Managing Stakeholder relationships including employee unions, staff, government and community

•    Experience working with legal advisors to manage workers’ compensations [sic] litigation obligations

•    Managed a number of projects (ideally managing change) simultaneously from conception to implementation and realisation of program objectives

•    Significant experience diagnosing and delivering organisational development and change solutions with business leaders

•    Communicating with, influencing and advising senior business and HR stakeholders

•    Established record of coaching, development and managing the performance of others

279    Under the subheading “Critical Knowledge” the following was stated:

•    Detailed understanding of the Safety, Rehabilitation and Compensation Act 1988 and expert knowledge of compensation

•    Detailed understanding of the workers compensation regulatory environment

•    Detailed understanding of the Self Insurance licensing system and compliance requirements

•    Business analysis, understanding of key financial tools and management reports to measure performance and inform decision making

•    Tertiary qualifications in Business, OH&S or related discipline

•    Extensive knowledge of key market drivers, industry players and latest developments within Comcar [sic] jurisdiction

•    Existing and new workers’ compensation processes and regulatory requirements

•    Must have existing knowlege [sic] of processing systems

•    Must have understanding of [APC] SBU components parts (PON, Retail, CMS), interfaces, key processes and information/material flows

•    Business and financial analysis and reporting process

•    High level decision making and communication skills

•    Capacity to understand complex issues, analyse data and develop appropriate solutions

Suitability of the MBII position

280    The MBII position was one of the three roles offered for Michael Newton to consider. The context in which those roles was offered is of some relevance. The MBII position did not exist within APC at the time it was offered. It is not clear on the evidence whether the other two positions were also newly created. These positions were offered to Michael Newton in the circumstances earlier recounted where, at the direction of Fahour, Darryl Newton was unable to offer Michael Newton a position in workers’ compensation or injury management.

281    As earlier set out, a position description for the MBII position was provided to Michael Newton with two other position descriptions on 20 June 2016. After a complaint from Maley on 8 July 2016 that each of those positions required skills that Michael Newton did not possess, the position description for the MBII position was amended and provided to Michael Newton by letter on 27 July 2016. APC’s position was that the adjustments to the position description did not create “a different or new position” and Darryl Newton’s evidence was that, despite the adjustments, the “essence of the role hasn’t really changed”. It is helpful to identify the adjustments in setting out the role description in its adjusted form. If the essence of the role was not changed the requirements deleted serve to help to identify that essence.

282    The MBII position description sets out the business context in which the position was intended to operate. It stated that APC had embarked upon a rapid transformation of its business model to better suit the needs of its customers in response to dramatic social and technological changes affecting Australia. Further, that APC was beginning “the next wave of change which will reposition it as a truly customer focussed organisation, with a broad offer beyond communications, and differentiated go-to-market propositions and associated brands”. Under the heading “Position Purpose” the following was stated (with the words which appeared in the original position description crossed through):

    The position brings together an unparalleled set of skills in data manipulation and analysis to help inform complex solutions and provide clarity to drive efficiencies within the Corporate Centre.

    This role is accountable to design, implement and deliver the analytics framework to deliver efficiencies within the Corporate Centre and make it simpler and more customer orientated to support the [APC] strategy.

283    Matters listed under the heading “Major Accountabilities” were broken up into three categories – Strategic Execution and Customer Interaction, Leadership and Organisation and Execution. Much of the focus of these accountabilities was data collection and analysis including, for instance, ensuring “effective day-to-day oversight of analytics for the Corporate Centre and adherence to analytical protocols”. The “Leadership” accountabilities made no reference to leading or managing other employees and other evidence confirmed that the role did not involve any direct reports. The role involved no management of employees. The “Organisation and Execution” accountabilities referred to problem solving skills critical to business issues, a demonstrated ability to deliver robust data analysis and reporting. References made in the original position description, to the ability to design data manipulation interfaces, perform data quality control, develop database reports and normalise relational data, were omitted.

284    Under a heading identifying the experience and knowledge that the position holder should ideally demonstrate, the position description set out the essential experience and critical knowledge required. For “Essential Experience” the following were stated (words in the original that were omitted are crossed out):

Industry and Function:

•    Strong project management experience.

•    Experience analysing data from financial systems.

•    Strong attention to detail and thoroughness in following systems and procedures.

•    Excellent organisational / time management skills.

•    Strong written and verbal communication skills.

•    Specific experience in the development of management and operational dashboards.

•    Demonstrated analytical thinking combining business acumen and elements of creativity.

•    Strong presentations skills; experience of presenting to internal and external stakeholders.

•    Comfortable working both internally and externally with technical and business experts providing input into future business offerings and opportunities.

•    Strong technical ability in the use of data analytical tools, data mining and data manipulation.

•    Ability to design solutions with ease of use in mind enabling seemless handover to business users.

Relationships:

•    Strong stakeholder management skills.

285    Under the heading “Critical Knowledge”, the following was stated (words in the original that were omitted are crossed out additional words are underlined):

Market and Environment:

•    Understanding of core accounting concepts.

•    Date Warehousing methodologies/techniques; Business intelligence reporting; and ERP systems.

[APC] Specific:

•    Not applicable.

Technical and Professional Qualifications/Skills Required:

•    Qualifications in IT, Computer Science or Finance

•    A solid technical grounding in SQL;

•    Experience in predictive analytic tools – e.g. Alteryx, Viscovery. R, etc

•    Data management and extraction experience – SSIS

•    Tertiary level qualifications in business or a related discipline

286    The assessment I need to make is not assisted by the vacuous “HR speak” with which position descriptions are commonly plagued. The oral evidence given did not provide much clarity into what the new and never before performed MBII position really would entail.

287    It is sufficiently clear, however, that the MBII position had nothing to do with Michael Newton’s defining skills, training and experience – his primary and essential skill and expertise as a manager leading and supervising a large team of employees and as a specialist in the field of the management of workers’ compensation claims, including with extensive experience in a self-insured corporation. Michael Newton had some 14 years of prior experience in the management of injured employees and their claims for compensation. That he was given the task of developing Project Dove illustrates the sophistication of his skills in that area.

288    No doubt the MBII position would have involved the utilisation of what I might call the generic or basic competencies which a long-standing manager with significant responsibilities would have, such as effective communication skills or time management and organisational skills or a basic capacity to analyse data. However, skills of that kind are merely foundational. They do not reflect the particular and defining expertise and specialist capabilities held by Michael Newton which no part of the MBII position description called for. To my mind, the essential rather than basic or foundational skills and experience required by the MBII position are not at all matched or suited to those which defined Michael Newton in his employment with APC.

289    The essential skills and experience called for by the MBII position are directed to customer service, product and business development with a focus on sophisticated data gathering and analysis to solve problems and develop strategies. These are matters largely foreign to Michael Newton’s particular expertise and specialist capabilities even though, including because of his training in business and some earlier relatively brief experience as a business analyst, Michael Newton may have been capable of carrying out the MBII position. It is suitability rather than capability which must drive the assessment. The fact that basic or foundational skills and expertise of the kind that Michael Newton has may make him capable of performing the duties of the MBII position, does not make the skills, training and experience required by the position commensurate with or matched with or befitting the skills, training and expertise held by Michael Newton. I do not consider the MBII position to be a “suitable” position within the meaning of cl 1.3(b) of the contract. The contrary conclusion would fall well short of the protection which cl 1.3(b) intended be provided to Michael Newton.

Suitability of the MPFS and MFWPA positions

290    APC did not require Michael Newton to occupy the MPFS position or the MFWPA position. It is not necessary to assess the suitability of those positions other than for questions of causation and mitigation of damages later addressed. It is convenient to assess here whether those two positions were “suitable” within the meaning of cl 1.3(b) of the contract. In my view neither position was “suitable for [Michael Newton]”.

291    APC put forward the MBII position as the most suitable of the three. I would infer from that a likely acceptance that if the Court held that the MBII position was not suitable it would follow that neither of the other two positions were suitable. I do not mean to suggest that any concession of that kind was necessarily made. However, if it was, the concession was correctly made.

292    The purpose of the MPFS position was to develop and drive strategy and a holistic and integrated people and career framework. The position description clearly articulated that this position was suited to the experience and skills of a senior HR manager, requiring at least 10 years’ experience in HR and extensive knowledge of HR strategy, best practice and principles. Michael Newton did not possess these skills or experience; he had never worked in HR let alone had 10 years’ experience in HR. Although Michael Newton has a qualification in business, has undertaken some HR courses and has experience leading a team, this experience was not commensurate with the level of HR knowledge and experience required of the MPFS position. The essential skills and experience called for by the position were not commensurate or matched with Michael Newton’s defining expertise and specialist capabilities. The position did not require Michael Newton to utilise his expertise as a manager leading and supervising a large group of employees. It had no direct or indirect reports and no management of budgeted spend. It was not a “suitable” alternative position within the meaning of cl 1.3(b) of the contract.

293    The purpose of the MFWPA position was to develop corporate strategy, the key accountabilities included developing a 3-5 year workforce strategy, supporting in the development and execution of a 1-3 year operating plan and contributing to the development of the enterprise strategy. The position requirements included strong working knowledge of the parcels/logistics industry and its consumers and the ability to lead quantitative and financial business analysis. Michael Newton did not have these skills or knowledge. Further, as deposed by Michael Newton, he did not have a “proven track record” in a top tier strategy consulting firm or strategic management role with at least 3-5 years’ experience, as the position required. The position also had no direct or indirect reports and no management of budgeted spend. Again, although Michael Newton held an MBA, the defining skills and experience required of this position were not commensurate with or matched to Michael Newton’s expertise and it was not a “suitable” alternative position.

Alleged Contractual Breach Relating to the Garden Leave Decision

294    Michael Newton’s SFASoC alleges that APC breached cl 10.4 of the contract by directing that Michael Newton take “garden leave”. The relevant direction was alleged to have been given in Roode’s letter to Michael Newton of 29 April 2016 referred to at [241] above.

295    Fairly read, Roode’s letter contained two directions:

(i)    that Michael Newton’s fitness for duty be assessed by a general practitioner and a psychiatrist (“medical assessment direction”); and

(ii)    that until those medical assessments were obtained, Michael Newton not return to work, refrain from contacting anyone at APC or accessing his emails (“exclusion from work direction”).

296    Clause 10.4 is headed “Garden leave”. What is meant by that expression is apparent from its terms. The clause addresses APC’s right to make an exclusion from work direction – that is, that no duties be performed, that no contact with APC employees, customers or business associates be made and that Michael Newton be excluded from APC’s premises. The capacity for APC to make such a direction under cl 10.4 is limited. It may only be made during part or all of any period of notice of termination given by Michael Newton or by APC, or during any period in which APC is investigating any disciplinary issues involving Michael Newton.

297    Clause 10.4 does not in any way deal with the making of a direction by APC requiring Michael Newton to be medically assessed. Much of the submissions made by Michael Newton in support of the alleged breach of cl 10.4 of the contract were directed to demonstrating that the medical assessment direction was not a lawful and reasonable direction. There are a number of difficulties with the submissions made for that purpose. First, the SFASoC does not allege that cl 10.4 was breached by reason of APC making the medical assessment direction. The SFASoC only alleges that cl 10.4 was breached because APC directed Michael Newton to take “garden leave”, which can only be a reference to the direction which I have described as the exclusion from work direction. Second, cl 1.8 of the contract provides that APC may require Michael Newton “to undergo medical…checks where [APC] determines it is desirable or necessary to do so”. The clause states that it is an ongoing condition of Michael Newton’s employment that he comply with any requirement to undergo a check. Neither the submissions of Michael Newton or APC seemed to have appreciated the existence of that contractual capacity given to APC.

298    There are two answers to Michael Newton’s claim that cl 10.4 was breached by APC making the exclusion from work direction. The first is that, putting aside para (b) thereof which is not relevant for present purposes, cl 10.4 does not impose any obligation upon APC which it is capable of breaching. Second, the circumstances in which the exclusion from work direction was made, did not engage cl 10.4. Clause 10.4 specifically confines the circumstances of its operation and none of those circumstances were present in relation to the making of the exclusion from work direction.

299    Michael Newton’s contention that cl 10.4 should be construed as a code which covers the field about the circumstances in which Michael Newton could be excluded from his workplace is entirely unpersuasive. Neither the terms of the provision nor common sense supports such a construction. Clause 10.4 could not have been intended to cover the field of reasons for which Michael Newton could be restrained from attending APC’s premises. If that were so absurd results would prevail. For example, even if attendance was dangerous to the health of employees, on the construction of cl 10.4 for which he contends, Michael Newton could not be instructed to stay away.

300    In so far as Michael Newton’s submissions relied upon the exclusion from work direction being an unlawful and unreasonable direction, that reliance has nothing whatsoever to do with an allegation that cl 10.4 of the contract was breached. That raises a different allegation of breach which has not been pleaded. Michael Newton ought not here be permitted to travel outside of his pleading including because, even if there were merit in the contention made, Michael Newton’s submissions do not establish that any relief whatsoever would flow from that breach. Those submissions did not even attempt to demonstrate any connection between the breach contended for and the damages claimed. If it was intended to ascribe part of the general damages claimed to the “garden leave” contractual breach claim, for reasons I will set out below, general damages could not be awarded in any event.

301    For all of those reasons, I reject the contractual claim made in reliance upon the Garden leave decision.

section 340 claim – garden leave decision

302    It is not in issue that the exclusion from work direction communicated to Michael Newton by Roode was a direction which emanated from Fahour. Michael Newton contended that by excluding him from work, APC subjected him to adverse action within the meaning of s 342 of the FW Act for reasons including the reason that he had a workplace right being his entitlement to a safe working environment pursuant to s 19(1)(a) of the WHS Act.

303    The relevant legislation and legal principles, including the basis for the workplace right that Michael Newton relies upon have been discussed already at [191]-[196] above.

304    I am satisfied that Michael Newton had the workplace right he contended for. I am also satisfied, by reason of the authorities discussed at [197] above, that the exclusion from work direction denied Michael Newton non-pecuniary benefits of employment sufficient to constitute a prejudicial alteration to his position. So much was accepted by APC.

305    It is because I am not satisfied that the reason asserted by Michael Newton was a reason for the exclusion from work direction that this claim must fail.

306    Fahour denied that he was actuated by the alleged reasons relied upon by Michael Newton. There is no basis for that denial not to be accepted. It is entirely plausible that Michael Newton’s entitlement to a safe workplace played no part in Fahour’s decision to give the direction.

307    I say that despite the fact that I harbour some concern that the reasons for the direction may not be truly reflected in the evidence given by Fahour. The decision to send Michael Newton home was an odd decision. It came well after the making of the Blee complaint. At the time the decision was made, Michael Newton had had no contact with Metcher for many months. Some of the other employees on Blee’s team, that Blee had suggested were put under stress by their contact with Metcher, were not sent home. Michael Newton had shown no symptoms of having been affected by stress. Neither Darryl Newton or Walsh could have held any concern about his fitness for duty including in relation to a position in injury management, as they had just selected Michael Newton to commence the MIMS position. The timing of the direction, coming a day or two after it was announced that Michael Newton would take up the MIMS position is also a matter which contributes to my concern given my conclusion about Fahour’s resistance to Michael Newton returning to a position in the area of workers’ compensation and injury management.

308    It is not, however, sufficient for Michael Newton to persuade me that Fahour had an ulterior purpose in making the exclusion from work direction. Michael Newton needs to demonstrate that that ulterior purpose or reason was the workplace right which he has asserted to be a reason which actuated the direction. To make that case out Michael Newton relied upon the same analysis as was put for the s 340 claim made in relation to the Removal decision which, as I have stated at [199], involved contending for a different prohibited reason to that alleged in the SFASoC. I have already addressed (at [201]-[202]) the reasons why that analysis is flawed. I have rejected this claim having assumed favourably to Michael Newton that s 361(1) of the FW Act was engaged, although I should not be taken to have accepted that the connection between the adverse action and the prohibited reason alleged was not so remote as to be fanciful.

relief

309    The only cause of action that has succeeded is Michael Newton’s claim that the contract was breached when he was removed from his position as National Compensation Manager. I have determined that cl 1.1 of the contract was breached by APC on 5 February 2016 when Michael Newton was removed from his position and that the breach continued until the contract was terminated.

310    Michael Newton claims substantial damages in the sum of $1,702,582.00. That calculation includes what in truth is a claim for debt relating to an unpaid bonus for the 2015/16 financial year. That claim was not pleaded and ultimately no claim relating to that bonus was pressed. The calculation also includes $4,116 for the reimbursement of university fees, but that claim was not pleaded nor proved. A claim for general damages of $50,000 is also included.

Loss of Remuneration Damages

311    What remains when those claimed losses are put aside, is a claim for loss of remuneration both past (as at the time of the trial) and future. The loss of remuneration claim is based on the annual salary and full bonus that Michael Newton alleged he would have earned under the contract from August 2016 through to December 2024 (less 30% for contingencies in relation to future earnings). Michael Newton contended that, but for the breach of his contract, he would have continued working for APC in a senior managerial role.

312    The economic loss claimed by Michael Newton only fell in after the termination of the contract. All of the loss sought by Michael Newton referable to the breach of cl 1.1 of the contract post-date the termination of Michael Newton’s employment.

Causation

313    The general principle is that damages for breach of contract are awarded to put the promisee, so far as money can do it, in the same situation as if the contract had been performed as promised: Clark v Macourt (2013) 253 CLR 1 at [26] (Crennan and Bell JJ). That principle emanates from a well-known statement made by Parke B in Robinson v Harman (1848) 1 Ex 850 at 855 that:

[w]here a party sustains a loss by reason of a breach of contract, he is, so far as money can do it, to be placed in the same situation with respect to damages, as if the contract had been performed.

314    As Brennan J stated in Commonwealth of Australia v Amann Aviation Pty Ltd (1991) 174 CLR 64 at 98, the principle expressed in Robinson v Harman “identifies both the subject of compensation (loss sustained by reason of a breach of contract) and the measure of damages (the amount required to place the innocent party in the same situation as if the contract had been performed)”. As Brennan J went on to say at 99, a plaintiff seeking damages from a defendant “bears the onus of proving both the loss sustained by reason of the breach and the damages for the loss”.

315    Chief Justice Mason and Dawson J observed in Amann Aviation at 80, that the award of damages for breach of contract “protects a plaintiff’s expectation of receiving the defendant’s performance. That expectation arises out of or is created by the contract. Hence, damages for breach of contract are often described as ‘expectation damages’”.

316    It was not really in contest that if removing Michael Newton from his position as National Compensation Manager and not providing him with a suitable alternative position was a breach of the contract, that breach was a repudiatory breach. A repudiatory breach entitled Michael Newton to elect to accept the repudiation and sue for damages brought about by the termination of the contract. But such an election was not made, or at least, it was not Michael Newton’s case that it was. However, contrary to the suggestion made in APC’s submissions, Michael Newton’s failure to rescind the contract for repudiatory breach did not foreclose his capacity to sue for damages relying on the same breach. A plaintiff can claim damages for breach of contract even though the plaintiff has not exercised a right to terminate the contract: Heydon JD, Heydon on Contract (Thomson Reuters, 2019) at [26.90]. As Mason J said in Progressive Mailing House Pty Ltd v Tabali Pty Ltd (1985) 157 CLR 17 at 31 (emphasis added):

It is often said that repudiation or fundamental breach - in the sense of breach of a condition or breach of another term or terms which is so serious that it goes to the root of the contract, and thus deprives the other party of substantially the whole benefit of the contract (Federal Commerce & Navigation Co. Ltd. v. Molena Alpha – entitles the innocent party to rescind the contract and sue for damages for loss of the bargain: see, e.g., Ogle v. Comboyuro Investments Pty. Ltd. But this does not mean that such damages are recoverable only in the event of discharge for breach though it is essential to an award of damages for loss of bargain that the defendant can no longer be required to perform his contractual obligations in specie.

317    In this case APC terminated the contract, not Michael Newton. Upon the termination of the contract APC was no longer required to perform its contractual obligations including the obligation to pay remuneration to Michael Newton.

318    As the contract was terminated, Michael Newton lost the benefit of the contract – namely, the remuneration he would have earned under the contract for the continuance of its term. If the breach of cl 1.1 was a cause of the termination of the contract then that breach was a cause of the loss or injury, being the remuneration Michael Newton would have earned under the contract.

319    On this head of damage Michael Newton contended that a loss of chance analysis was the appropriate approach to the assessment of his loss. It is not clear to me that it makes any difference to the assessment of this head of damage whether the loss is characterised as a loss of the bargain or the loss of a chance or opportunity to take the benefit of the bargain. In either case what is being valued is the benefit of the contract. In either case, what needs to be assessed is whether the loss flowed from the breach of cl 1.1 and, if it did, the extent of that loss by reference to the remuneration that Michael Newton has or is likely to earn by reason of other employments or engagements (a scenario I will call “the factual”) and the remuneration he would have earned under the contract in his employment with APC (a scenario I will call “the counter-factual”) over the period that that employment would have continued. Michael Newton’s loss would be the difference between the remuneration that was or would have been earned on the factual and the remuneration that would have been earned on the counter-factual. By that process of assessment the object of putting the promisee, so far as money can do it, in the same situation as if the contract had been performed as promised, may be achieved.

320    There are issues raised as to whether Michael Newton has suffered loss by reason of the breach of the contract upon which his cause of action relies. APC contended that all of Michael Newton’s claimed economic loss is referable to the termination of the contract by APC, an act not contended by Michael Newton to be in breach of the contract or otherwise unlawful. APC contended that Michael Newton suffered no loss by reason of any breach by it of cl 1 of the contract.

321    That contention raises a causation issue. Did the economic loss claimed by Michael Newton flow from the breach of cl 1.1 or did it solely flow from APC’s unchallenged act of termination of the contract? That issue about causation is not avoided by Michael Newton characterising his claim for damages, as I perceive he attempted to do, as a claim for a loss of a chance. As Kiefel J said in Tabet v Gett (2010) 240 CLR 537 at [143] “[r]esort to the language of ‘chance’ cannot displace the analysis necessary for the determination of the issue of causation of damage”.

322    The now well established principles relating to causation were recently expressed by the Court of Appeal of the Supreme Court of Victoria in Trampoline Enterprises Pty Ltd v Fresh Retailing Pty Ltd [2019] VSCA 74 at [86] (Kaye, McLeish and Hargrave JJA). Relying on a series of High Court judgments including March v E and M H Stramare Pty Ltd (1991) 171 CLR 506 at 514 (Mason CJ); Chappel v Hart (1998) 195 CLR 232 at 244 at [27] (McHugh J); Henville v Walker (2001) 206 CLR 459 at [106] (McHugh J) and also Alexander v Cambridge Credit Corporation Ltd (1987) 9 NSWLR 310 at 315 (Glass JA), and at 357–8 (McHugh JA), their Honours said this:

In essence, the law does not take a philosophical or formulaic approach to the question of whether a breach of contract has resulted in loss to the injured party. Rather, the law approaches the issue of causation as a matter of common sense. In particular, it is not necessary for a plaintiff to establish that the relevant breach of contract was the sole or exclusive cause of the loss claimed. It is sufficient if, in the circumstances of the case, the breach of contract materially contributed to the loss.

323    It is helpful in understanding what was meant by the expression “the breach of contract materially contributed to the loss” to refer to its source and the observation made by McHugh J at [27] of Chappel v Hart, where his Honour said this:

Before the defendant will be held responsible for the plaintiff’s injury, the plaintiff must prove that the defendant’s conduct materially contributed to the plaintiff suffering that injury. In the absence of a statute or undertaking to the contrary, therefore, it would seem logical to hold a person causally liable for a wrongful act or omission only when it increases the risk of injury to another person. If a wrongful act or omission results in an increased risk of injury to the plaintiff and that risk eventuates, the defendant’s conduct has materially contributed to the injury that the plaintiff suffers whether or not other factors also contributed to that injury occurring.

324    In my view, APC’s breach of contract created or generated the situation in which it was likely that the injury suffered by Michael Newton would be sustained. In that respect the breach materially contributed to the injury and was thus a cause of it.

325    In assessing whether APC’s breach of cl 1.1 was a cause of the loss of Michael Newton’s employment and the remuneration he would have earned in that employment, it is important to properly identify the breach. As I have said, the breach was APC’s failure, commencing on 5 February 2016, to employ Michael Newton in the position of National Compensation Manager. That breach could have been avoided or remedied if Michael Newton had been placed into a suitable alternative position but he was not.

326    At the heart of the contract of employment is an exchange of work for remuneration – the work/pay bargain. Under the contract, Michael Newton’s remuneration was paid to him for providing the services required by the contracted position ie either the National Compensation Manager position or a suitable alternative position. Once Michael Newton was denied the capacity to provide those services to APC, for which he continued to be remunerated at the level commensurate with his contracted position, his ongoing future employment became commercially unsustainable. Taking a common sense view, it was likely, and in the absence of a variation of the contract it was inevitable, that that situation would result in the termination of Michael Newton’s employment within a short period after what had been bargained for by APC was not being received. APC’s failure to employ Michael Newton in his contracted position created or generated the very risk of injury that Michael Newton suffered – that his employment and earning capacity under the contract would be brought to an end by APC exercising its right to terminate on notice pursuant to cl 10.1(a) of the contract.

327    It would not be correct to construe APC’s exercise of its right to terminate as based upon Michael Newton’s refusal to obey a lawful and reasonable direction to perform the MBII position, because on the findings I have made about the suitability of that position, there was no lawful and reasonable direction made. It may however be said that a cause of the exercise of the right to terminate was APC’s view that a lawful and reasonable direction had been refused. In either case, such a cause bore a relationship to the breach of contract proven by Michael Newton and was not independent of that breach as a cause of the loss suffered by Michael Newton. Even if an independent and separate cause existed, it was not necessary for Michael Newton to establish that the breach he relies upon was the sole cause of the loss claimed.

Did an intervening event break the chain of causation?

328    If APC’s exercise of its contractual right to terminate is of itself to be regarded as an intervening event, it is not an event which broke the chain of causation because irrespective of whether that event was innocent or unlawful, it was, in the ordinary course of things, the very kind of thing likely to happen as a result of APC’s breach. That conclusion is an application of what was said by Mason CJ in March at 518 as follows:

It has been said that the fact that the intervening action was foreseeable does not mean that the negligent defendant is liable for damage which results from the intervening action: see Chapman v. Hearse; M’Kew; Caterson v. Commissioner of Railways. But it is otherwise if the intervening action was in the ordinary course of things the very kind of thing likely to happen as a result of the defendant’s negligence. In Dorset Yacht, Lord Reid observed:

‘But if the intervening action was likely to happen I do not think that it can matter whether that action was innocent or tortious or criminal. Unfortunately, tortious or criminal action by a third party is often the ‘very kind of thing’ which is likely to happen as a result of the wrongful or careless act of the defendant’.

329    APC contended that the chain of causation between the breach and the termination losses was severed by the various actions of Michael Newton between February 2016 and 11 August 2016. In particular it was contended that what led to the termination of Michael Newton’s employment was his own actions in failing to reasonably engage with any sensible return to work. In that respect it was said that Michael Newton failed to engage in a meaningful way with the process of meeting with Darryl Newton to discuss the roles being proffered or by attempting to grow into any of the roles on offer. APC contended that it was clear that Michael Newton would have remained in employment with APC, under the same contract of employment, at the same hierarchical level, earning the same amount of remuneration with the same bonus eligibility, if he had so engaged. Instead of so doing, APC submitted that it was Michael Newton’s own free, informed and voluntary actions in failing to reasonably engage which ultimately led to the termination of his employment. It was APC’s submission that it was those actions that are properly to be regarded as the only, or only effective, cause of Michael Newton’s losses. It was further contended that the losses would not have been caused by the breach alone and could not have been caused without Michael Newton’s own actions in failing to reasonably engage in the process of his return to work, or ultimately, to accept the MBII position he was directed to take up.

330    I do not accept that Michael Newton failed to reasonably engage in the process of being returned to work in a position including by not accepting the MBII position he was directed to take up. As I have found, neither the MBII position nor the other two positions offered for Michael Newton’s consideration were a “suitable” alternative position. It was not unreasonable for Michael Newton to reject a return to work in a position of employment by, in effect, insisting on being employed in a position to which he was entitled to be employed under the contract. Michael Newton’s conduct amounted to no more than an insistence that APC comply with its contractual obligation and was not unreasonable. If Michael Newton’s conduct was not unreasonable, “it could not be said in the circumstances that that action, rather than [APC’s breach], was the cause of [Michael Newton’s losses]”: Caterson v Commissioner for Railways (1973) 128 CLR 99 at 110-111 (Gibbs J, with whom Barwick CJ, Menzies and Stephen JJ agreed); see also Medlin v The State Government Insurance Commission (1995) 182 CLR 1 at 22.

331    It is APC that bears responsibility for the failure to place Michael Newton into a “suitable” alternative position. A number of “suitable” positions were available for Michael Newton to take up including a return to the National Compensation Manager position (available at least until 26 April 2016) and the MIMS position (available from that date). It was Fahour’s refusal to permit Michael Newton to take up either position which denied Michael Newton’s placement into a “suitable” position. As I have stated, I do not accept that Fahour’s refusal was materially based on a concern for Michael Newton’s wellbeing and no other basis to justify the refusal is apparent. That both Walsh and Darryl Newton were in favour of Michael Newton being appointed to the MIMS position persuades me that there was no reasonable basis for Michael Newton’s exclusion from that position.

332    In so far as APC relies on Michael Newton’s attitude and behaviour demonstrated during the process of being returned into a suitable position, I accept that at times Michael Newton was slow to respond to communications (although APC was slow as well) and that Michael Newton was less receptive and less willing to meaningfully engage with APC than he might otherwise have been. That needs to be assessed in the context of Michael Newton’s justifiable view that he had been badly mistreated by APC and that the process that APC was engaging him in was really the first step in bringing about the termination of his employment. His behaviour was not unreasonable in the circumstances and could not be said to be the cause of the losses which he claims.

333    There is no reason, as Mason CJ said in March at 519 “in common sense, logic or policy” for refusing to regard APC’s breach of cl 1.1 of the contract as a cause of the losses suffered by Michael Newton.

Remoteness of damage

334    APC also contended that the claimed termination losses were too remote from any breach of the contract. The principles for assessing whether damage is too remote were not in contest. The principles are set out by Brennan J in Amann Aviation at 98:

The rule in Hadley v. Baxendale prescribes the condition on which damages can be awarded in respect of a loss sustained by reason of a breach of contract:

‘Where two parties have made a contract which one of them has broken, the damages which the other party ought to receive in respect of such breach of contract should be such as may fairly and reasonably be considered either arising naturally, i.e., according to the usual course of things, from such breach of contract itself, or such as may reasonably be supposed to have been in the contemplation of both parties, at the time they made the contract, as the probable result of the breach of it.’

Applying the rule in C. Czarnikow Ltd. v. Koufos, Lord Reid said that:

‘The crucial question is whether, on the information available to the defendant when the contract was made, he should, or the reasonable man in his position would, have realised that such loss was sufficiently likely to result from the breach of contract to make it proper to hold that the loss flowed naturally from the breach or that loss of that kind should have been within his contemplation.’

335    What is “sufficiently likely” are damages “not unlikely to result from the breach” (C. Czarnikow Ltd v Koufos [1969] 1 AC 350 at 382-3 and 385; Wenham v Ella (1972) 127 CLR 454 at 471-2), or which are a “serious possibility” (Alexander at 365; Unity Insurance Brokers Pty Ltd v Rocco Pezzano Pty Ltd (1998) 192 CLR 603 at [60]; Romero v Farstad Shipping (Indian Pacific) Pty Ltd (No 3) [2016] FCA 1453 at [21]).

336    As APC correctly contended, the onus of proving that the claimed losses are not too remote falls upon Michael Newton: Amann Aviation at 80 and 99; Clark v Macourt at [27].

337    APC contended that Michael Newton cannot establish that the losses were a “serious possibility” arising from the breach of cl 1 of the contract. It submitted that the relevant juxtaposition here is between the contract being performed (by Michael Newton being placed in a “suitable” position) and the contract being breached (by Michael Newton being placed in no position, or an unsuitable position). APC said that in either case, when the parties made the contract, they would not have reasonably contemplated that placing Michael Newton into an unsuitable position would have led to the claimed loss on termination and that, in fact, they would not have contemplated any loss arising from such a breach, as the contract would have remained on foot and the employment would have continued.

338    The submission is unpersuasive. It is premised on the unlikely scenario that the parties contemplated that the innocent party the subject of the breach of the contract, would have accepted the contract-breaker’s non-performance and, by conduct or otherwise, assented to its variation.

339    The correct analysis, unburdened by a flawed premise, is that termination losses flow naturally from the breach of cl 1.1, including because it was a repudiatory breach of the contract and Michael Newton was entitled to terminate the contract and sue for termination losses. Termination losses are therefore damages “not unlikely to result from the breach”. Furthermore, for the reasons explained at [326] as to why it was likely that the breach of the contract would result in termination and subsequent loss, those losses are damages “not unlikely to result from the breach” even if the analysis is to be confined to a termination at the instance of APC. Lastly, APC’s contention that because Michael Newton refused to accept a “suitable” position he increased his damages thereby making those damages too remote, is rejected including because there was no rejection of a “suitable” position and further, the responsibility for any failure for a “suitable” position to have been provided so that it could have been accepted, falls at the feet of APC.

The Measure of Damages

340    I turn then to deal with the measure of damages. In dealing with the measure of damages, the “least burdensome principle” can have application. Under that principle and as the High Court (Gleeson CJ, Kirby, Heydon, Crennan and Kiefel JJ) said in Gumland Property Holdings Pty Ltd v Duffy Bros Fruit Market (Campbelltown) Pty Ltd (2008) 234 CLR 237 at [89] “where a contract-breaker has a choice of methods of performance, damages will be assessed on the basis of the contract-breaker’s minimum legal obligation – the method which would have been least onerous to the contract-breaker in the sense that non-compliance with it attracts the lowest measure of damages”.

341    APC did not rely upon the “least burdensome principle” and it was correct not to do so. APC did not suggest that the termination effected on 11 August 2016 with the giving of notice, was the invocation by it of the least onerous method of non-compliance with its contractual obligation. No such suggestion was open including because by the time APC effected the termination, the breach upon which Michael Newton relies was complete. The facts are not relevantly dissimilar to those in Commonwealth Bank of Australia v Barker (2013) 214 FCR 450, where the failure to follow a redeployment policy and redeploy an employee was the alleged breach of contract but where the damage which the employee suffered fell in at the point at which he was later dismissed by his employer on four weeks written notice. In obiter but not in dissent on this issue and on the presumption that there was a breach of the contract by reason of the failure to redeploy, Jessup J at [354] rejected the employer’s invocation of the “least burdensome principle”:

The appellant’s invocation of the least burdensome principle encounters an immediate obstacle in the facts of the case. The least burdensome principle takes it as a given that the party otherwise in default would seek to do, or at least to achieve the effect of, what was done irregularly. The appellant had no desire to terminate the respondent’s employment. On 2 March 2009, he was told that it was the appellant’s preference that he be redeployed to another position. It was not until 9 April 2009 that the appellant dismissed the respondent, but by then the breach of contract for which damages were assessed by the primary Judge was complete. In respects relevant to that breach, the case was not one in which the appellant made an ineffective attempt lawfully to terminate the employment of the respondent. It is not, therefore, a situation in which we should assume that the appellant would have adopted the least burdensome method of lawfully doing what it attempted to do. The question was not whether there was a means of dispensing with the services of the respondent that would not involve a breach of contract. The omissions which the primary Judge held to constitute a breach of contract on the part of the appellant were not by way of attempts to terminate his services. In my view, the least burdensome principle had no role to play in the assessment of damages in the present case.

The counter-factual

342    There is, however, another way in which the availability to APC of a contractual capacity to terminate the contract on providing notice of termination may be relevant in assessing the measure of damages where, on the counter-factual, the assessment of damages takes into account the future capacity to earn remuneration under that contract. APC’s capacity to terminate is a hypothetical future event of relevance just like other possible personal exigencies or contingencies which must be taken into account. The relevant question being would APC have exercised its capacity to terminate the contract and if so when? That approach has been taken or considered in a number of cases including Walker v Citigroup Global Markets Australia Pty Ltd [2006] FCAFC 101 at [83]-[84] (Gyles, Edmonds, and Greenwood JJ), Willis Australia Group Services Pty Ltd v Mitchell-Innes [2015] NSWCA 381 at [117-123] (MacFarlan JA with whom Ward and Leeman JJA agreed) and Amann Aviation at 93 and 97-8 (Mason CJ and Dawson J). The approach is not, in my view, confined to cases where damages are being assessed on the basis of a loss of a chance.

343    However, no submission was made by APC and no evidence was called to the effect that if APC had not breached the contract and, on the counter-factual, Michael Newton had remained employed by APC, APC would have exercised its right to terminate the contract on providing notice either at the time it did or otherwise, save that in contending for a discount for contingencies APC referred to the possibility of Michael Newton’s employment with it coming to an end.

344    I will return later to the issue of the appropriate discount for contingencies. I turn first to consider, on the counter-factual, the income Michael Newton would have likely earned under the contract. Under the counter-factual, I will assume that Michael Newton would have remained employed in the position of National Compensation Manager or in an alternative “suitable” position, although the assumption remains valid even if Michael Newton was placed into a position other than a “suitable” position so long as the remuneration in that other position remained commensurate with that likely to have been earned in the National Compensation Manager position.

345    Michael Newton’s claim for loss is based on 8.33 years of employment with APC from 11 August 2016 when the contract was terminated. APC’s submission did not specify the period Michael Newton would likely stay in employment with it on the counter-factual but that submission was based on the proposition that within no more than about 3 years and 9 months of August 2016, Michael Newton would have been in employment in which his income was commensurate with the income he would have earned at APC. For reasons I will further develop, I consider that assessment to be about right but would regard 4 years as a more likely time period by which Michael Newton’s income would reach the same level as it would have been if he had remained employed by APC.

346    I am of the view that even if Michael Newton remains unemployed as at the time of this judgment, it is likely that he will obtain remunerative employment commensurate with the remuneration payable for the National Compensation Manager position by August 2020 because, by this judgment, a very significant impediment to Michael Newton’s opportunity of obtaining such employment will be lifted. Michael Newton’s employment history prior to August 2016 demonstrates that he has not previously had difficulty finding employment and securing new job opportunities commensurate with his skills and specialist expertise. As I later record, Michael Newton made extensive efforts to find work between August 2016 and the date of the trial without any success. But I regard that as an aberration largely brought about by the circumstances in which he lost his employment with APC. He has not been able to obtain a reference from APC and he has been often required to tell potential employers that he was dismissed by APC for refusing a lawful and reasonable direction. It is likely that any potential employer seriously considering employing Michael Newton would want to know the basis upon which he left his prior employment and will be greatly concerned, if not put off entirely, by being told that APC terminated Michael Newton’s employment for the reason that APC gave. This judgment vindicates Michael Newton’s position and provides Michael Newton the opportunity of conveying to potential employers that APC bears responsibility for the loss of what the evidence persuades me was a very capable and highly performing employee.

347    On that basis, in considering the counter-factual, it is only necessary to work on the assumption, which I consider to be reasonable, that Michael Newton would have stayed in employment with APC in his contracted position or another position with the same remuneration for four years – that is to 11 August 2020. At that time Michael Newton will be a little less than 49 years of age.

348    Michael Newton’s annual salary when the contract was terminated was $187,480. Although it was contended that an allowance should be made for an increase in Michael Newton’s annual salary based on likely future promotions, there was no evidence about the likelihood of future promotions nor was the extent of any allowance contended for specified. I would not provide for any such allowance.

349    The evidence persuades me that Michael Newton is a very capable high performing employee. In the last full financial year in which he worked in the National Compensation Manager position (2014/15) he earned a bonus of $34,701. I consider it reasonable to assume that in each of the four years through to August 2020 Michael Newton would have continued to earn an annual salary of $187,480 and a bonus commensurate with the bonus earned in 2014/15 ($35,000) ie a total salary of $222,480 per annum and, over the four year period in question, a total of $889,920.

350    I accept that that total should be discounted for contingencies. The submissions were not particularly enlightening as to the appropriate rate at which that should be set. For the first 2.33 years post August 2016, Michael Newton contended that no discount should be made but that thereafter a discount of 30% should be allowed. I assume, although it was not explained, that that discount was based on the vicissitudes of life and that in the first 2.33 years to the date of the trial which was attended by a seemingly fit and healthy Michael Newton, there could be no suggestion for a discount of that kind. Michael Newton referred to the 25% contingency discount applied in Walker “to take account of the possibility of early termination for one reason or another” (at [84] and [87]) as indicative of the appropriateness of the discount suggested by him.

351    By its submission, APC contended that the appropriate discount for contingencies would be in the order of 50%. APC relied on the discount of 50% found to be appropriate in Maritime Union of Australia v Fair Work Ombudsman [2015] FCAFC 120. In that case, a Full Court (Allsop CJ, Mansfield and Siopis JJ) in reassessing the appropriate discount for contingencies increased the discount applied by the primary judge from 20% to 50%. As is apparent from the observations made at [142]-[146], the basis for the 30% uplift to the rate applied by the Full Court was the failure of the primary judge to take into account the casual nature of the counter-factual employment as well as the particular vicissitudes of life at sea and the significant possibility that the employees concerned would find lengthy periods of separation unsustainable. None of the considerations upon which the 30% uplift was based are here relevant. In so far as I am assisted by the result in that case, it seems to me that that decision supports a discount rate of about 20%. However, I am not much assisted because in my view, primary attention must be given to the particular circumstances of the case in question.

352    APC contended that the evidence demonstrated that there was some turnover of managers at APC and that, despite there being no evidence of “mass redundancies”, the workplace was redolent with change including because alterations to roles and duties are not infrequent. However, the evidence referred to does not suggest anything other than the ordinary turnover of staff in a large employer like APC. It was further contended that Michael Newton’s employment may well have ceased either by reason of changes to his role, or by reason of his reaction to those proposed changes. The submission is unpersuasive. It is premised on Michael Newton being responsible for the loss of his employment in August 2016. I reject that premise for reasons previously addressed.

353    APC is a very large employer and as such its opportunity to provide its employees with ongoing employment is relatively large. I consider Michael Newton’s characterisation of APC as a large employer that offered “security and longevity” likely to be accurate. I rely as well on the evidence that, on average, employment at APC lasts 16 years. Furthermore, prior to the termination of his contract, Michael Newton had a record of stability in employment and family and financial responsibilities which suggest that he would be keen to maintain secure employment. Michael Newton struck me as a capable individual, well respected by his colleagues, hard working and the kind of person who would be well placed to enhance the security of his employment. There is nothing out of the ordinary to suggest that as an individual of less than 50 years of age in a managerial role, health or personal considerations would have impeded his ongoing employment through to August of 2020. In the circumstances, I consider that a 20% discount for contingencies should be applied.

The factual

354    Turning then to consider what I have called the “factual scenario”, there are known facts and yet unknown factors which need to be considered. At the time of the trial, evidence was received about Michael Newton’s earnings and his attempts to secure work.

355    Michael Newton has not been able to secure any full-time work since his employment was terminated by APC on 11 August 2016. Since then he has undertaken paid and unpaid consultancy work for two businesses and has been self-employed as a landscape gardener. He has earnt $22,366 through this work. The calculation of his earnings must also take into account the 3 months’ pay provided in lieu of notice by APC.

356    After the Removal decision and fearing that his employment at APC was at risk, Michael Newton first contacted a number of recruitment agencies in February 2016 and had weekly contact with those firms before the termination of the contract. Michael Newton provided the Court with a list of job positions that he had applied for commencing from February 2016 to the date of trial, and deposed that he was still searching for a job. The jobs that Michael Newton applied for were in the workers’ compensation, injury management and occupational health and safety fields. The majority of salaries for these positions ranged from $120,000 to $150,000, the lowest salary was $90,000 and the highest was $200,000. Doing the best I can to interpret Michael Newton’s comments on the list provided, he applied and was unsuccessful for approximately 31 positions and he made enquiries about approximately 28 other positions. Michael Newton also registered with approximately 15 recruitment agencies. Michael Newton deposed that in applying for positions he was often asked to provide the reason for leaving his position at APC and that he advised that his position was terminated due to not following a reasonable management request. Further, that many potential employers requested references and that he had attempted to secure references from his APC managers but that he did not receive any response to those requests. As at the date of the trial, a number of job applications were still pending.

Mitigation

357    APC was critical of Michael Newton’s conduct contending that he failed to mitigate his losses. The legal principles are not in contest. They are helpfully surveyed by Ross J in Whittaker at [169]-[176]. Subject to the reservation that each case must be determined on its own facts, the observations of Ross J were adopted by Nicholson J (with whom Gray and Sulan JJ agreed) at [139]-[140] of Regional Development Australia Murraylands and Riverlands Inc v Smith [2015] SASCFC 160. Those authorities support the following principles:

    the general rule is that an applicant is not entitled to recover damages for any loss that has in fact been avoided or could have been avoided by taking reasonable steps;

    the question of what steps are reasonable is a question of fact to be determined having regard to the particular circumstances;

    there is no onus on an applicant to show it has taken reasonable steps to mitigate loss, rather the onus is on the respondent to show that the applicant did not take reasonable steps and show the extent of the failure to do so;

    mitigation does not require an applicant to do what is unreasonable including to do things that present serious risks to the applicant’s interests;

    in employment cases, personal factors are likely to be of greater weight than in commercial cases; and

    it is not unreasonable to refuse an offer of employment where the level of remuneration or status of the position offered is less than that previously enjoyed by the applicant, but with the passage of time, it may be reasonable for the applicant to “lower their sights”.

358    APC contended that Michael Newton’s attempts to obtain employment are characterised by a lack of reasonableness. That was said to be so because Michael Newton focused almost exclusively on employment in the field of workers’ compensation or injury management in circumstances where he has post-graduate qualifications in finance, human resources and industrial relations. In that respect APC contended that Michael Newton had not been prepared to “lower his sights”.

359    That criticism must be rejected. The evidence that Michael Newton was prepared to “lower his sights” is manifest. The vast majority of positions that he applied for were positions well below the level of remuneration, and I would infer, level of status, of the position that Michael Newton previously enjoyed. The jobs applied for were in the fields of workers’ compensation, injury management and occupational health and safety. Each of those fields are wide and the large number of positions applied for (as well as Michael Newton’s registration with approximately 15 recruitment agencies) demonstrated that Michael Newton embarked upon a wide field of enquiry. Despite the fact that the field did not extend to finance, human resources and industrial relations (areas in which Michael Newton has some qualifications but no experience) does not in my view, demonstrate that the field of exploration chosen by Michael Newton was unreasonably narrow and that, in that respect, Michael Newton failed to “lower his sights”. In any event, I note that Michael Newton did work outside of his occupational field including by taking on landscaping work. The most cursory of factual comparison with the facts in Riverlands, where the employee there in question was held to have failed to “lower his sights” well demonstrates how far off the mark APC’s reliance on Riverlands is. In that case, the former CEO of a regional council only applied for four positions after his contract was repudiated in the 2 years and 4 months subsequent to the termination of his contract and did not lower his sights by applying for positions of a lower status or less remuneration to that which he previously enjoyed.

360    APC also contended that Michael Newton failed to mitigate his losses by refusing alternative positons offered to him by APC in the period after 5 February 2016. As only the MBII position was refused, I assume that the contention was confined to that position, although if reliance was also being made on the MPFS or MFWPA positions my conclusion would be the same. Although I doubt it to be the case, I will assume in favour of APC that a duty to mitigate loss exists at a time when that loss is merely prospective and whether it will eventuate is uncertain. Nevertheless, I reject APC’s contention that there was a failure to mitigate by any non-acceptance of either the MBII, MPFS or MFWPA positions. As I have earlier discussed, there was nothing unreasonable in Michael Newton insisting on APC complying with its contractual obligations. Further, the duty to mitigate did not extend to requiring Michael Newton to do things that presented a serious risk to his own interests. Accepting a position that compromised his contractual entitlements would have, in the circumstance, likely to have been seriously adverse to Michael Newton’s interests.

The need for updating

361    To return more directly to the assessment of earnings on the factual scenario, it is also necessary to assess Michael Newton’s earnings after the trial and through to August 2020. As things currently stand, that assessment could only be made as a matter of judgment and degree on the basis of evidence that was current at the time of the trial. The unfortunate delay between that time and the present is long. It is likely that if the Court was updated with evidence of Michael Newton’s earnings and employment circumstances, the Court would be better able to assess with greater surety the quantum of Michael Newton’s loss because the assessment will more readily be able to be made on actual rather than assumed facts.

362    I am minded therefore, subject to hearing any objection if there be any, to receive evidence or preferably a statement of agreed facts which deals with Michael Newton’s earnings and his employments since trial. It would be better still if on the basis of that updating and my findings, the parties were able to agree the damages and any interest payable under s 51A of the Federal Court of Australia Act 1976 (Cth). A Registrar of the Court can be made available to mediate if that would be of assistance.

363    This course will be facilitated by directions I intend to make.

General Damages

364    Lastly, Michael Newton also claims $50,000 in general damages for pain and suffering. The claim was based on Michael Newton’s evidence that he had become withdrawn, had difficulty sleeping and suffered from isolation. I suspect that the claim was made principally in relation to Michael Newton’s statutory causes of action which have not succeeded. Nevertheless, the claim for general damages was also made under the contractual claim.

365    The claim must be rejected because Michael Newton is not able to claim damages for distress in relation to his breach of contract claim.

366    The general rule in relation to contractual breaches is that damages for anxiety, disappointment and distress are generally not recoverable, save for certain exceptions: Baltic Shipping Co v Dillon (1993) 176 CLR 344 at 361 (Mason CJ with whom Toohey and Gaudron JJ agreed). The rule in relation to those exceptions was detailed by Mason CJ in Dillon (at 365, with whom Toohey and Gaudron JJ agreed) as follows:

damages for disappointment and distress are not recoverable unless they proceed from physical inconvenience caused by the breach or unless the contract is one the object of which is to provide enjoyment, relaxation or freedom from molestation. In cases falling within the last-mentioned category, the damages flow directly from the breach of contract, the promise being to provide enjoyment, relaxation or freedom from molestation. In these situations the court is not driven to invoke notions such as ‘reasonably foreseeable’ or ‘within the reasonable contemplation of the parties’ because the breach results in a failure to provide the promised benefits.

367    It was not the object of the contract to provide Michael Newton peace of mind nor was Michael Newton physically inconvenienced. Even if I were to be satisfied that Michael Newton was distressed and that the distress flowed from the breach of contract, I would nevertheless find that no award for distress could be made. In support of his submission Michael Newton referred to Walker (at [91]), however, in that case the damage for distress was awarded in relation to Mr Walker’s statutory claim and not his contractual claim.

conclusion

368    I have rejected all of Michael Newton’s statutory claims and, in particular, his claimed contraventions of ss 348, 355 and 340 of the FW Act and associated claims of accessorial liability.

369    Of the two contractual claims made, one (a breach of cl 1.1 of the contract) has succeeded but the other (an asserted breach of cl 10.4 of the contract) has failed.

370    In relation to the contractual claim that has succeeded, I have rejected Michael Newton’s claim of general damages for pain and suffering. I have upheld his claim of damages for loss of remuneration. The quantum of that loss is not yet fully assessed and I propose that the Court receive further evidence or an agreed proposal to enable that assessment to be finalised.

371    I will make orders to facilitate that course.

Associate:

Dated:    23 December 2019

SCHEDULE OF PARTIES