General protections cases; knowledge and the rebuttable presumption

One of the most important forensic elements of the body of case law which now exists about the Fair Work Act general protections arises from the practical obstacles which a respondent faces in establishing or making out the rebuttable presumption, often called the reverse onus of proof.

Here is the issue at play in an important appeal dealt with by a Full Court of the Federal Circuit Court. It involved an analysis of the difficulties for a respondent attempting to discharge the rebuttable presumption in circumstances in which the relevant person may not have even known of the critical events. I beg your pardon, you may well ask!

“We deal first with the issue of whether knowledge by a respondent that a person has engaged in industrial action is a pre-condition to the engagement of the presumption in s 361(1).

The authorities establish that in order to engage s 361, the following must be established.

First, there must be an allegation in the application which satisfies the requirements of s 361(1)(a). That requirement is not an issue in this case so we do no more than refer to the decision of this Court in Australian Building and Construction Commissioner v Hall [2018] FCAFC 83; (2018) 261 FCR 347 (Hall) at [13]–[14].

Secondly, the applicant must establish as an objective fact the circumstance said to be the reason for the taking of the adverse action.  That requirement is not an issue in this case so we do no more than refer to Tattsbet Ltd v Morrow [2015] FCAFC 62; (2015) 233 FCR 46 (Tattsbet) at [119] per Jessup J (with whom Allsop CJ and White J agreed); Celand v Skycity Adelaide Pty Ltd [2017] FCAFC 222; (2017) 256 FCR 306 (Celand) at [154] per Bromberg J (with whom Charlesworth J agreed on this point); Hall at [16].

Thirdly, and perhaps there is more scope here for debate as to precisely how the following consideration operates, it is said that an applicant must establish that the evidence is consistent with the hypothesis that the respondent was actuated by a proscribed purpose.

In General Motors-Holden’s Pty Ltd v Bowling (1976) 51 ALJR 235 (Bowling), the High Court considered s 5(4) of the Conciliation and Arbitration Act 1904 (Cth) which was in the following terms:

In any proceeding for an offence against this section, if all the facts and circumstances constituting the offence, other than the reason for the defendant’s action, are proved it shall lie upon the defendant to prove that he was not actuated by the reason alleged in the charge.

Justice Mason (as his Honour then was; with whom Stephen and Jacobs JJ agreed) said the following about the operation of the subsection:

Section 5(4) imposed the onus on the appellant of establishing affirmatively that it was not actuated by the reason alleged in the charge. The consequence was that the respondent, in order to succeed, was not bound to adduce evidence that the appellant was actuated by that reason, a matter peculiarly within the knowledge of the appellant. The respondent was entitled to succeed if the evidence was consistent with the hypothesis that the appellant was so actuated and that hypothesis was not displaced by the appellant. To hold that, despite the subsection, there is some requirement that the prosecutor brings evidence of this fact is to make an implication which, in my view, is unwarranted and which is at variance with the plain purpose of the provision in throwing on to the defendant the onus of proving that which lies peculiarly within his own knowledge.

In Board of Bendigo Regional Institute of Technical and Further Education v Barclay (No 1) [2012] HCA 32; (2012) 248 CLR 500, Gummow and Hayne JJ at [104]–[105] said that the approach of Mason J in Bowling applied to the provisions of the FW Act (in that case s 346) and that, with respect to onus of proof, the FW Act adopts the same position as that under the 1904 Act.

In Australian Building and Construction Commissioner v Hall [2017] FCA 274; (2017) 269 IR 28, Flick J (at [253]) referred to Mason J’s observations in the passage set out above in support of the proposition which his Honour accepted that, in order to invoke the reverse onus of proof, an applicant need only establish that the evidence is consistent with the hypothesis that a respondent was actuated by a proscribed reason.

In Construction, Forestry, Mining and Energy Union v BHP Coal Pty Ltd [2015] FCAFC 25; (2015) 230 FCR 298, the Full Court made the following observation (at [192]):

It is possible that the alleged reason may be negated by a respondent on the applicant’s own evidence.  Where the connection between the reason alleged and the impugned conduct is so remote as to be fanciful, the onus may well be discharged in the absence of any evidence from the decision-maker.  But as French CJ and Crennan J observed at [45] of Barclay, “[g]enerally, it will be extremely difficult to displace the statutory presumption in s 361 if no direct testimony is given by the decision-maker”.

Finally, in terms of our review of the authorities, in Celand, Bromberg J (with whom Charlesworth J agreed on this point) after reviewing the above authorities said that neither of the “qualifications”, that is the second and third matters set out above, mean that the applicant must establish a prima facie connection between the alleged adverse action and a prohibited reason and that there is an obvious difference between establishing a prima facie connection and demonstrating that the connection between the reason alleged and the impugned conduct is not so remote as to be fanciful.

It may well be appropriate to describe the requirement that the evidence is consistent with the hypothesis that the respondent was actuated by a proscribed purpose a pre-condition or as operating before the presumption is engaged.  After all, the presumption operates and continues to operate unless the person who took the action proves otherwise.  However, we do not think a conclusion to that effect resolves the issue in this case which is whether it was necessary for the Union to prove, before the presumption was engaged, that Ms Emblem engaged in protected industrial action.

In our opinion, the Union was not required to prove that Ms McIlroy knew that Ms Emblem had engaged in protected industrial action before the presumption in s 361(1) was engaged. First, the time delay between the protected industrial action and the inappropriate language incident of four to five months was not (contrary to the submission of the Red Cross parties) of such a nature as to make a connection between the reason alleged and the impugned conduct so remote as to be fanciful. Secondly, if the evidence was as it was, but excluding any evidence one way or the other of Ms McIlroy’s knowledge of Ms Emblem’s engagement in protected industrial action, still we do not think it could be said that the evidence was inconsistent with a hypothesis that Ms McIlroy had acted for a proscribed purpose. Thirdly, and most importantly, 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 (i.e., knowledge that the relevant person had, say, engaged in protected industrial action). For these reasons, we do not consider that the Union was required to prove that Ms McIlroy knew Ms Emblem had engaged in protected industrial action before the presumption in s 361(1) was engaged.

Ms McIlroy gave evidence and it was necessary for her evidence to be assessed.  If the primary judge had found that Ms McIlroy did not know that Ms Emblem had engaged in protected industrial action, then it is difficult to see how she could be found to have a proscribed purpose.  It is in the evidence and the way in which it was dealt with by the primary judge that the difficulties lie.

There are three points which should now be made.

First, although the Union does not have to uphold the primary judge’s reasoning in paragraph 121 (set out above at [61]) in view of the operation of the presumption, that reasoning does not withstand analysis without evidence (at least) that Ms McIlroy knew that Ms Emblem associated with Ms Bailey and Ms Condon.

Secondly, Ms McIlroy gave evidence that she did not specifically recall whether Ms Emblem had engaged in protected industrial action.  In response to evidence from Ms Emblem that she saw Ms McIlroy and Ms McIlroy saw her a few times “during the period when I took protected industrial action”, Ms McIlroy consulted her diary and Ms Emblem’s timesheets.  Ms McIlroy identified only two occasions where she was present at the Edward Street Donor Centre which might be relevant.  The first occasion was on 5 November 2013 when she was present at the centre for approximately two hours to conduct interviews with enrolled nurses.  The second occasion was on 11 November 2013 when she attended the centre at 8 am for a one hour interview with an enrolled nurse.  On this date, Ms Emblem did not start work until 10 am.  Ms McIlroy is unsure whether she was still present at the centre when Ms Emblem commenced her shift.  She said that her general practice after conducting interviews at a donor centre was to leave the donor centre and return to the Brisbane Processing Centre or wherever her next meeting was.  The primary judge does not address this evidence in his Honour’s reasons for judgment.

Thirdly, and on the other side, the Union referred to evidence not relied on by the primary judge which the Union submits supported a finding that Ms McIlroy was aware that Ms Emblem took protected industrial action. The Union refers to evidence of Ms McIlroy in her affidavit to the effect that the overwhelming majority of employees at the Area 1 Donor Centres participated in some form of protected industrial action and oral evidence from Ms McIlroy to similar effect. She said that she did not know who the staff were who participated in protected industrial action, but, “[t]here was an overwhelming majority of our staff that took industrial action”. The Union also submitted that it was logical to infer that the corporate knowledge gained by Ms McNab would have been passed on to Ms Fealy who, in turn, would pass it on to her immediate superior, Ms McIlroy, with whom she worked closely. The Union submitted that putting these matters together, it was sufficient to establish that, with or without the operation of s 361(1) of the FW Act, the fact that Ms Emblem had engaged in protected industrial action was established by the evidence.

The difficulty is that the primary judge has not expressly dealt with the evidence that might favour a conclusion that Ms McIlroy did not know that Ms Emblem had engaged in protected industrial action.  The primary judge was required to consider all the evidence advanced by a party relevant to an issue.

A trial judge is not required to refer in his or her reasons to every piece of evidence relevant to an issue.  The significance of the evidence and whether it is covered by a more general finding will bear on the assessment of whether it should be concluded that the evidence has been overlooked.  We consider that substantial delay between the trial and the delivery of reasons is also relevant to this assessment.  It supports, in our respectful opinion, the conclusion that the evidence has not been assessed and weighed in the balance.  In Expectation Pty Ltd v PRD Realty Pty Ltd  [2004] FCAFC 189; (2004) 140 FCR 17, the Full Court identified principles which are relevant to the issues in this case. The Court said (at [71] and [80]):

71           In the normal course, statements made by a trial judge of a general assertive character can be accepted as encompassing a detailed consideration of the evidence. However, where there is significant delay, such statements should be treated with some reserve. After a significant delay, a more comprehensive statement of the relevant evidence than would normally be required should be provided by the trial judge in order to make manifest, to the parties and the public, that the delay has not affected the decision.

80          The delay in the present case went beyond the minimum period of “operative delay”. In those circumstances, in his reasons for judgment his Honour was required to carry out a detailed consideration ie, a more comprehensive statement of the relevant evidence (to use the words of the Court of Criminal Appeal in Maxwell) than would normally be required. The purpose of doing so would have been to demonstrate to all concerned that the delay had not affected his decision. This is not a case in which, sitting as an appellate court, it can be assumed that the mere failure to refer to evidence did not mean that it had been overlooked.

We do not think that it can be concluded that the primary judge has considered all of the evidence relevant to Ms McIlroy’s knowledge.  Nor do we think that this Court can undertake the task of weighing and assessing the evidence which would include not only Ms McIlroy’s evidence, but also the additional evidence relied on by the Union.  Self-evidently, much may depend on the assessment of Ms McIlroy as a witness.

We have considered whether the primary judge’s adverse conclusions with respect to a number of aspects of Ms McIlroy’s evidence should lead to the conclusion that it was inevitable that he would have rejected her evidence.  There are two problems in taking that approach.  One is the obvious one that a Court may accept the evidence of a witness on some matters, but not on others.  Secondly, the delay between the trial and the delivery of judgment means that, in relation to the findings his Honour did make, there is a real risk the primary judge has compromised his ability to use the advantage his Honour had of observing Ms McIlroy (and others) as a witness (Tattsbet at [134] per Jessup J; Allsop CJ and White J agreeing).

Regrettably, having regard to the circumstances, the appropriate order in this case is a retrial before another judge.  We would invite the parties to make short written submissions on the appropriate terms of the remitter.

We should add that we consider the same result would follow even if we are wrong about the operation of the presumption in s 361(1) because in that event, evidence relied on by the Union as relevant to the issue has not been considered or considered properly by the primary judge.

Was Ms McIlroy a Decision-Maker in relation to the Fourth Decision, that is, the Decision to Dismiss Ms Emblem on 2 June 2014?

There are two issues in relation to the decision to dismiss Ms Emblem on 2 June 2014.

The first issue is that of Ms McIlroy’s knowledge that Ms Emblem had engaged in protected industrial action.  This is the same issue as is raised in connection with the first issue and is discussed above.  The same result obtains.  Because that issue cannot be determined by this Court, the overall issue of whether there was a contravention in relation to the fourth decision cannot be determined by this Court unless this Court decides the second issue in favour of the Red Cross parties.

The second issue is whether Ms McIlroy was a decision-maker in relation to the decision to dismiss Ms Emblem.  As we have previously said, the primary judge found that the decision‑makers were Ms Thompson and Mr Bosse.  The Union submitted that this conclusion was wrong and that Ms McIlroy was either a decision-maker or she made an indispensable contribution to the decision such that if she had a proscribed purpose, it taints the decision.  Clearly, a “decision-maker” can range from one person to a committee or group, and from a person or body starting from scratch to a person or body rubber-stamping the recommendation of others.

The decision of this Court in Elliott v Kodak Australasia Pty Ltd [2001] FCA 1804; (2001) 129 IR 251 (Kodak) that the absence of a proscribed purpose in the mind of a decision-maker who adopts as his or her starting point the results of an assessment and ranking of an employee by reference to certain criteria performed by others does not foreclose the issue of purpose and a proscribed purpose may still be found where such was the purpose of a person who makes an indispensable contribution to the rankings.  Kodak was followed by Reeves J in Construction, Forestry, Mining and Energy Union v Clermont Coal Pty Ltd [2015] FCA 1014; (2015) 253 IR 166 who (at [121]–[122]) spoke in terms of a person whose reasons had a material effect on the ultimate decision or outcome.

We accept that a person who is involved in the process leading to the decision may be a decision‑maker for the purpose of a proscribed purpose, but we do not need to formulate a precise test for the purpose of this case and consider it prudent to refrain from doing so.

There was a good deal of evidence in this case that Ms McIlroy was centrally involved in the decision to dismiss Ms Emblem.  Ms McIlroy was Mr Fealy’s superior and it was the two of them who interviewed Ms Emblem on 29 May 2014.  Ms McIlroy advised Ms Thompson of Ms Emblem’s responses at the meeting and she recommended the dismissal of Ms Emblem.  Ms McIlroy attended a meeting with Ms Thompson and Mr Bosse on 30 May 2014 and she, with Ms Fealy, attended the meeting with Ms Emblem on 2 June 2014 when the latter was told that her employment would be terminated.  Ms McIlroy admitted in cross-examination that she was the person who had investigated the matter, that Ms Thompson and Mr Bosse had had “no hands-on role in dealing with the disciplinary issue” and that she was part of the decision‑making process.

The difficulty in this Court deciding that Ms McIlroy was a decision-maker in the relevant sense is that we do not have the primary judge’s assessment of the evidence of Ms Thompson that Ms McIlroy was not part of the decision-making process and Mr Bosse’s evidence that he was the decision-maker.  We cannot see how this Court can assess that evidence as it has not seen or heard the witnesses.

This is a matter which, although not as compelling as the problems with the knowledge issue, means that the matter must be the subject of a retrial.”

 

Australian Red Cross Society v Queensland Nurses’ Union of Employees [2019] FCAFC 215 delivered 3 December 2019 per Greenwood, Besanko and Rangiah JJ