Fair work cases; valid reason for dismissal

Although the Fair Work Act does not command that the most important legal criterion when determining whether the termination of an employee’s employment is relevantly unfair, it is perhaps the most important factor and is determined thus;

“Valid reason (s 387(a))

General principles

[12] It is necessary to consider whether the employer had a valid reason for the dismissal of the employee, although it need not be the reason given to the employee at the time of the dismissal. 1 In order to be “valid”, the reason for the dismissal should be “sound, defensible and well founded”2 and should not be “capricious, fanciful, spiteful or prejudiced.”3

[13] The Commission will not stand in the shoes of the employer and determine what the Commission would do if it was in the position of the employer. 4 The question the Commission must address is whether there was a valid reason for the dismissal related to the employee’s capacity or conduct (including its effect on the safety and welfare of other employees).5

[14] In cases relating to alleged conduct, the Commission must make a finding, on the evidence provided, whether, on the balance of probabilities, the conduct occurred.6 It is not enough for an employer to establish that it had a reasonable belief that the termination was for a valid reason. 7

[15] The employer bears the evidentiary onus of proving that the conduct on which it relies took place. 8 In cases such as the present where allegations of serious misconduct are made, the Briginshaw standard applies so that findings that an employee engaged in the misconduct alleged are not made lightly.9

[16] In Patrick Stevedores Holdings Pty Ltd v CFMMEU, 10 Justice Lee made the following useful observations about the Briginshaw standard and its impact on fact finding and the state of satisfaction required [references omitted]:

“Fact Finding and the State of Satisfaction Required

  1. It is trite that both Patricks and Qube are required to prove their case on this liability hearing to the civil standard having regard to the degree of satisfaction required by s 140 of the EA. This section requires the court, in a civil proceeding, to find the case of a party proved if it is satisfied that the case has been proved on the balance of probabilities. In deciding, in a civil case, whether it is satisfied that the case has been proved, the court is to take into account: (a) the nature of the cause of action or defence; (b) the nature of the subject-matter of the proceeding; and (c) the gravity of the matters alleged. Although the standard of proof remains the balance of probabilities, the degree of satisfaction varies according to the seriousness of the allegations made and the gravity of the consequences (if the allegations are found to be correct): see EA s 140.
  2. Importantly, the factual allegations made by both Patricks and Qube are not only foundations for the nature of the relief dealt with at this liability hearing (that is, declarations of contraventions of the FW Act), but are also the foundations for the deferred relief, that is, the imposition of pecuniary penalties.
  3. It is well-established that s 140 reflects the common law as explained seminally by Dixon J in Briginshaw v Briginshaw. As the Full Court noted in Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing & Allied Services Union of Australia v Australian Competition and Consumer Commission:

The mandatory considerations which s 140(2) specifies reflect a legislative intention that a court must be mindful of the forensic context in forming an opinion as to its satisfaction about matters in evidence. Ordinarily, the more serious the consequences of what is contested in the litigation, the more a court will have regard to the strength and weakness of evidence before it in coming to a conclusion.

Even though he spoke of the common law position, Dixon J’s classic discussion in Briginshaw…at 361-363 of how the civil standard of proof operates appositely expresses the considerations which s 140(2) of the [EA] now requires a court to take into account. Dixon J emphasised that when the law requires proof of any fact, the tribunal must feel an actual persuasion of its occurrence or existence before it can be found. He pointed out that a mere mechanical comparison of probabilities independent of any belief in its reality, cannot justify the finding of a fact. But he recognised that (Briginshaw 60 CLR at 361-262):

‘No doubt an opinion that a state of facts exists may be held according to indefinite gradations of certainty; and this has led to attempts to define exactly the certainty required by the law for various purposes. Fortunately, however, at common law no third standard of persuasion was definitely developed. Except upon criminal issues to be proved by the prosecution, it is enough that the affirmative of an allegation is made out to the reasonable satisfaction of the tribunal. But reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters “reasonable satisfaction” should not be produced by inexact proofs, indefinite testimony, or indirect inferences…’

Dixon J also pointed out that the standard of persuasion, whether one is applying the relevant standard of proof on the balance of probabilities or beyond reasonable doubt, is always whether the affirmative of the allegation has been made out to the reasonable satisfaction of the tribunal. He said that the nature of the issue necessarily affected the process by which reasonable satisfaction was attained. And, so, he concluded that in a civil proceeding, when a question arose whether a crime had been committed, the standard of persuasion was the same as upon other civil issues. But he added, weight must be given to the presumption of innocence and exactness of proof must be expected (Briginshaw 60 CLR at 362-363).

  1. It is also clear that so-called “Briginshaw principles” apply to civil penalty proceedings (which is a particular example of the application of s 140(1) of the EA)…”

Extract from Hall v Pacific National Pty Ltd (2022) FWC 94 delivered 20 January 2022 per Saunders DP

ason for dismsal