Unfair dismissal and employer policies

This extract from an unfair dismissal case of the Fair Work Commission constitutes a good example of the legal principles which are used to determine the effect of breaches of an employer’s policies and unfair dismissal outcomes.

“Consideration

[14] By operation of s.387 of the Act, the Commission must take into account certain

cumulative matters in considering whether a dismissal was harsh, unjust or unreasonable. I turn

to those matters.

(a) Whether there was a valid reason for the dismissal related to the person’s capacity or

conduct (including its effect on the safety and welfare of other employees)

[15] The Code of Conduct imposes certain obligations on employees of the respondent.

Relevantly, clause 3 (Staff responsibilities) identifies to employees that:

“You are responsible for familiarising yourself with agency policies and procedures, and

complying with them. You are also responsible for making enquiries if you are unsure

about what actions to take.

You need to be aware that the reputation of the transport agencies can be affected by

your actions at work and, in certain circumstances, by your conduct outside the

workplace.

You must: …[various obligations]”.

[16] Apart from the overarching matters set out in clause 3 of the Code of Conduct, clause

14 also addresses specific obligations. Clause 14 reads as follows:

“14. Criminal Conduct

If you are charged or convicted with any offence which may impact on your ability to

undertake part or all of the inherent requirements of your role, you must immediately

notify your manager.

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If you are charged or convicted with a serious criminal offence, whether or not it is

related to work, you must immediately notify your manager. You may be suspended

from duty pending the outcome of disciplinary or legal proceedings. A serious criminal

offence means an offence committed in New South Wales that is punishable by

imprisonment for six months or more or an offence committed elsewhere that, if it had

been committed in New South Wales, would be an offence so punishable.

If there is sound evidence that you have committed a criminal offence at work or related

to work, Transport may take disciplinary action against you as well as notifying the

police or other relevant external authority.

[17] At least some of the May 2021 Charges can be described as involving, within the

meaning of clause 14 of the Code of Conduct, a “serious criminal offence” (or offences), given

the potential imprisonment term of six months or more attaching to a conviction. The

applicant’s failure to immediately notify his manager (or, after the charges had been laid, in a

timeframe immediately proximate to when the charges had been laid) involved a breach of the

obligation in clause 14 of the Code of Conduct.

[18] I am satisfied that there was a valid reason for the dismissal related to the applicant’s

conduct in failing to make the report required to be made by the Code of Conduct. As the Code

of Conduct notes: “You may be suspended from duty pending the outcome of … legal

proceedings.” The failure by the applicant to comply with the reporting obligation not only

amounted to a breach of the Code of Conduct, but the applicant’s failure to report also deprived

the respondent of information that would have informed its own decision-making concerning

any steps it may have wished to take in relation to the applicant’s employment, pending the

determination or outcome of the charges. As to that, the May 2021 Charges involved, in short,

charges with components concerning drugs, guns and alleged proceeds of crime. I accept the

respondent’s submission that the applicant’s reporting breach was not a minor breach, but

constituted a breach which went to the heart of the trust that the respondent is entitled to have

in its employment relationships.

[19] The dismissal letter referred also to the fact of the 2022 convictions. As expressed in the

dismissal letter, the fact of the convictions gave cause for concern to the respondent separately

from, and/or in addition to, the failure to report the May 2021 Charges. Specifically, Magistrate

Follent said the following in relation to one of the charges:

“For the offence of supply cannabis, more than the indictable but less than the commercial

quantity, you are convicted and sentenced to imprisonment for 12 months to date from

29 June 2022 and to expire on 28 June 2023, to be served by way of an intensive

corrections order under s 7 of the Crimes (Sentencing Procedure) Act. …”.

[20] In and of themselves, criminal convictions do not necessarily provide a valid basis for

the dismissal of an employee (and the historical conviction to which reference was made in this

case certainly would not provide a valid basis for dismissal). The fact of the convictions in 2022

does not, however, appear to have been the principal reason for the dismissal – at least as the

case was advanced before me. It was the reporting breach which appeared to have a greater

emphasis in the respondent’s case albeit the fact of the subsequent convictions significantly

fed-into the decision-making concerning the disciplinary outcome of dismissal. I have noted

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and accepted the applicant’s submission that the respondent appears, from the dismissal letter,

to proceeded on the mistaken basis that the applicant had been convicted on a dozen charges,

whereas no conviction was recorded concerning some of the charges that were eventually

pressed. However, I have also considered the evidence of one of the respondent’s witnesses,

which read:

“24. Sydney Trains is an organisation that operates under the Rail Safety National Law

which deals with all matters to do with rail safety. Importantly, it requires that a rail

safety workers must not carry out or attempt to carry out rail safety work while there is

any presence of alcohol or a ‘prescribed drug’ in their system. A prescribed drug

includes cannabis.

  1. I am regularly involved with new staff members coming into Sydney Trains and the

process whereby we explain to them the fact that even taking small amounts of drugs in

their spare time might result in them losing their jobs if they test positive at work. A

Station Duty Manager is someone who also has to explain this to staff and assist with

the facilitation of drug testing.

  1. I do not suggest that Mr Strangio had illicit drugs in his system or took illicit drugs

at any point. And when I was considering this matter and speaking with [the decision

maker], I did not proceed on the basis that Mr Strangio did consume cannabis. What I

have had regard to is the fact that Mr Strangio admitted to being in possession of

approximately 2 kilograms of cannabis, which is deemed as supply. In my view, that

makes it difficult to see how Sydney Trains could have confidence in his ability to

deliver this message and be seen as genuine. I consider that if staff were aware of this

fact, it would send a very poor message about the values of Sydney Trains.

  1. My view is that the nature of the offence itself is incompatible with working at

Sydney Trains. …”

(b) Whether the person was notified of that reason

[21] I am satisfied that the applicant was notified of the reasons for his dismissal, in the priordismissal sense considered in Crozier v Palazzo Corporation Pty Ltd (2000) 98 IR 137, as

affirmed in cases including Mark Bartlett v Ingleburn Bus Services Pty Ltd t/a Interline Bus

Services [2020] FWCFB 6429.

(c) Whether the person was given an opportunity to respond to any reason related to the

capacity or conduct of the person

[22] I am satisfied that the applicant was given an opportunity to respond to the conductrelated reason as contemplated in the criterion in s.387(c) of the Act, and did in fact respond.

(d) Any unreasonable refusal by the employer to allow the person to have a support person

present to assist at any discussions relating to dismissal

[23] There is no evidence that there was any unreasonable failure by the respondent to allow

the applicant to have a support person present to assist at any discussions relating to dismissal.

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(e) If the dismissal related to unsatisfactory performance by the person—whether the person

had been warned about that unsatisfactory performance before the dismissal

[24] The dismissal in this case did not relate to unsatisfactory performance, so the question

of prior warning is not apposite. As I have noted, the applicant was a well-regarded employee

in terms of performance.

(f) The degree to which the size of the employer’s enterprise would be likely to impact on the

procedures followed in effecting the dismissal and (g) The degree to which the absence of

dedicated human resource management specialists or expertise in the enterprise would be likely

to impact on the procedures followed in effecting the dismissal

[25] The respondent is a sizeable employer, with approximately 11,000 employees. The

procedures that the respondent adopted were conformable with procedures that might be

expected from an employer of its size and which has in-house human resources management

personnel. The procedures that the respondent adopted were also conformable with its own,

multi-stage processes.

(h) Any other matters that the Commission considers relevant

[26] A central feature of the applicant’s case was that his failure to report the May 2021

Charges arose against the background of legal advice that was given to him. As the applicant

put matters: “At all times I was acting on the legal advice of my solicitor who recommended

that I ‘hold off’ informing my employer of the charges until the police facts were settled.” The

applicant advanced, by way of mitigation, that, acting on legal advice, he fully intended to

inform the respondent of the pending charges, but was denied this opportunity due to the

intervening anonymous tip-off.

[27] The statement of evidence by the applicant’s solicitor in the criminal matters, Rodney

Van Houten of Van Houten Law, was similarly to the effect that he had advised the applicant

not to report matters to the respondent until the final form of the charges was settled. Mr Van

Houten’s evidence read, in part:

“5. Due to the nature of the charges, I was working with the Police Informant and later

Police Prosecutor to reach an agreed fact sheet and Withdrawal of the charge of Deal

with proceeds of Crime.

  1. In what was quite a remarkable departure from usual practice and for inexplicable

reasons, these negotiations were protracted and not settled for a further 12 months. I

believe that the impact of COVID-19 and the availability of various personnel,

significantly contributed to much of this delay.

  1. It was on my advice to Mr Strangio that he delay informing his employer of the

charges as they were first comprised in May 2021, given the work that was being done

by me and the Police.

  1. I advised Mr Strangio that it would be likely at least one of the of the charges would

be withdrawn and the Police facts amended.

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  1. Based on the Police brief and evidence, I formed the opinion that whilst Mr Strangio

was charged with a number of offences, that it would be unlikely that he would receive

a custodial sentence and that those charges would likely be dealt with at the lower end

of the Sentencing options. It was on this basis that I advised Mr Strangio to delay

informing his employer of the charges until they were settled.

  1. Regrettably, and before the hearing, I am advised that Mr Strangio’s employer

received an anonymous report incorrectly advising that Mr Strangio had been convicted

of a number of offences. At the date of the anonymous report, Mr Strangio’s matter had

not been heard before the Parramatta Local Court.”

[28] As to that part of the applicant’s case around the advice given by Mr Van Houten, the

respondent’s submissions included the following:

“26. … To the extent that it is based on a submission that the Applicant relied upon the

advice of his criminal lawyer to not report the 10 May 2021 Charges, Sydney Trains

says:

(a) this was a choice made by the Applicant and one freely exercised when

alternatives existed;

(b) there is no evidence that he received advice about alternatives such as

disclosing that he had been charged but was in receipt of advice not to presently

disclose to Sydney Trains;

(c) it demonstrates that he placed his own interests above those of Sydney Trains;

(d) the Respondent should not have to factor poor or incorrect advice into its

decision-making process with reference to its employees;

(e) there is no evidence about when he would have disclosed the 10 May 2021

Charges to Sydney Trains despite the 13 month period between the 10 May 2021

Charges and making Sydney Trains aware of the advice he had received; and

(f) it is available to draw the conclusion that absent the anonymous report, the

Applicant would not have ever disclosed the 10 May 2021 Charges.

  1. All of these matters should assist the Commission in drawing the conclusion that

Sydney Trains reached, that is, the advice received does not undermine the valid reason

for dismissal in any way or otherwise render the dismissal decision harsh, unjust or

unreasonable.

  1. Further, the Applicant’s conduct was objectively very serious. He was charged with

13 criminal offences and was convicted of having 2kgs of cannabis in his possession.

This is not a minor criminal matter. His role with Sydney Trains was one where the

safety of his colleagues and customers depended on the exercise of trustworthy decision

making.

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  1. The Code makes it clear that breach of the Code might result in the termination of

employment. The Applicant must have appreciated the risk of that occurring when he

knowingly chose not to report the 10 May 2021 Charges. The conclusion is readily

available that he made this choice because he knew how serious those charges were and

the seriousness with which they would be viewed by Sydney Trains.”

[29] I have noted and considered the evidence of the applicant and Mr Van Houten about the

advice given by Mr Van Houten that the applicant acted on, in not informing the respondent

about the May 2021 Charges. Regardless of the advice given by Mr Van Houten to the

applicant, the employment obligation on the applicant, arising from the Code of Conduct, was

unambiguously applicable, namely, that “If you are charged … with a serious criminal offence,

whether or not it is related to work, you must immediately notify your manager.” The (only)

appropriate course would have been for the applicant to adhere to his reporting obligation under

the Code of Conduct once that obligation was engaged around 10 May 2021.

[30] If and when the initial criminal charges changed, it would have been the open and

appropriate course to update the relevant manager/the respondent accordingly after the initial

report concerning the May 2021 Charges had been made by the applicant (albeit the Code of

Conduct does not appear to impose any updating requirement, unless, for example, an additional

charge or charges were laid which came within the Code of Conduct-specified meaning of “a

serious criminal offence”). Having regard to the mandatory language of the Code of Conduct,

it was not an open or appropriate course for the applicant to withhold information from the

respondent about the May 2021 Charges. This is so notwithstanding the matters addressed in

the evidence of Mr Van Houten as to the reasons for his advice to the applicant, including: that

Mr Van Houten “was working with the Police Informant and later Police Prosecutor to reach

an agreed fact sheet and Withdrawal of the charge of Deal with proceeds of Crime”; that “these

negotiations were protracted and not settled for a further 12 months”; and/or that Mr Van

Houten considered it would be unlikely the applicant would “receive a custodial sentence and

that those charges would likely be dealt with at the lower end of the Sentencing options. It was

on this basis that I advised Mr Strangio to delay informing his employer of the charges until

they were settled.”

[31] As things transpired, the fact of the applicant’s non-disclosure of the May 2021 Charges

came to be the subject of an investigation as a result of an anonymous tip-off on 9 April 2022 –

which was approximately 11 months after the laying of the initial charges. The tip-off

information was incorrect to the extent that it suggested the applicant already had been

convicted, but it was a particularly regrettable turn of events in the employment relationship

that information about criminal matters came to the attention of the respondent other than by a

direct report from the applicant as required by the Code of Conduct – and, thereby, an

investigation was commenced by the respondent.

[32] As to various other matters in the case, including in connection with the submissions

about whether the dismissal was harsh in all the circumstances, I have considered all matters

relied upon by the parties even if not canvassed in this decision. I have given particular

consideration to the applicant’s atypically lengthy period of employment, i.e., the applicant’s

employment commenced when he was aged 16 years and he had an ensuing 37 years of “largely

untarnished” and satisfactory performance with the respondent and its predecessor/s. I have

also given particular consideration to the fact that the sentencing on the convictions concerning

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the amended charges comprised, in terms of practical outcomes, 100 hours of community

service on the drug charge and a fine concerning the prohibited weapon charge. I have also

given consideration to what was said by Magistrate Follent on 29 June 2022 in the sentencing

remarks, including reference to the applicant’s “stability in employment for a very significant

period” in terms of his rehabilitation prospects.

[33] Both parties’ cases advanced matters around the question of proportionality of the

disciplinary outcome of dismissal. Even accepting the matters relied on in the applicant’s case

at their highest in such respects (including, for example, the financial impact and the availability

of alternatives short of dismissal), I am not satisfied that the dismissal was disproportionate to

the applicant’s conduct in him failing to adhere to the reporting obligation imposed by the Code

of Conduct.

Conclusion

[34] Considering all matters, including the authorities to which reference was made, the

applicant has not established a case that the dismissal was harsh, unjust or unreasonable. As

such, the applicant’s application for an unfair dismissal remedy is dismissed.”

 

Strangio v Sydney Trains [2023] FWC 730 delivered 6 April 2023 per McKenna C