Harsh, Unreasonable Or Unjust Dismissal On Medical Grounds

"Harsh, unreasonable or unjust dismissal on medical grounds – onus effectively lies on large employer to show that it has acted reasonably"

Warren v Department of Education [2009] NSWIRComm 1032

1 July 2009

In Brief

• The Industrial Commission of NSW has served notice on large organisations that they defend unfair dismissal cases purely "on the papers" at their peril.

• The decision under the unfair dismissal provisions of the Industrial Relations Act 1996 (NSW) is indicative of the criteria likely to be considered under similar provisions in Part 3-2 of the Fair Work Act 2009 (Cth). It therefore has wide application to large employers, be they government or private.

Background

The Applicant was continually employed as a teacher by the Department of Education of New South Wales from 1977¹. She had received awards for her high standard of teaching and contribution to public education.

In 2005 the Applicant was granted a transfer from a school in Ballina to another school in Byron Bay (both in northern NSW) on compassionate grounds, being her difficulty in driving a motor vehicle for longer than 15 minutes. The Principal of Byron Bay School was made aware of the Applicant's medical inability to perform some playground duties or teach sport. Accommodations were made by the School to re-rostering playground duties and classes.

In September 2006, the Applicant informed the Byron Bay Principal that she was allergic to certain resins and paints which might be present at Byron Bay School premises. The Principal ordered a Medical Assessment which found that she "should be fit for the inherent job requirements with some adjustments."

In August 2007, the Principal of the school requested a further Medical Assessment. This resulted in a report dated January 2008 which identified 5 significant restrictions on the Applicant's ability to perform the inherent requirements of her role, being:

• inability to travel by motor vehicle for periods in excess of 20 minutes;
• inability to drive at night;
• inability to conduct sport lessons or playground supervision;
• inability to supervise students on extended excursions; and
• allergic response to resin, paint fumes and solvents with potential for anaphylactic reaction.

Nevertheless, the report concluded that the Applicant "would be capable of teaching with some adjustments".

The Department of Education directed the Applicant via telephone not to return to work for the start of the 2008 School year. The Applicant successfully appealed this suspension of her employment.

After further Workplace Assessment by an Occupational Therapist which again noted the significant restrictions on her capacity to perform her role, the Department ordered her retirement on medical grounds.

Application for reinstatement

The Applicant filed a claim in the Industrial Relations Commission of NSW pursuant to section 84 of the Industrial Relations Act 1996, seeking reinstatement to her position on the basis that her decision was "harsh, unreasonable or unjust".

It should be noted that section 385 of the Fair Work Act 2009 (Cth) also applies a regime of "Unfair Dismissal", and this is in almost identical terms to that of the NSW Industrial Relations Act, protecting against dismissals that are "harsh, unjust or unreasonable". This judgment therefore has application beyond the fairly narrow scope of cases which fall under the former Act.

Following unsuccessful conciliation, the matter proceeded to arbitration before Commissioner Cambridge.

The Arbitration

The Department of Education did not adduce oral evidence from the senior bureaucrat who made the decision to dismiss the Applicant teacher. It is not uncommon for large organisations to dispense with evidence from such senior managers, given their numerous other responsibilities. Instead, the case was essentially run "on the papers".

What may at first glance have appeared to be a relatively strong case for dismissal on medical grounds began to unravel: Counsel for the Applicant was able to point to at least one significant inconsistency between the letter of dismissal and the Medical Assessment reports, and this strengthened his complaint that the Applicant was unable to test various assertions in her letter of dismissal by reason of the absence of the decision-maker.

This complaint of prejudice was reinforced by the acknowledged fact that the teacher had not been given the opportunity to state her case directly to the decision-maker (as opposed to her immediate supervisor, the Principal of the school).

Other failings in the Department's case were also apparent:

• Although the applicant acknowledged the significant restriction on her ability to perform her duties, the Medical Assessment report which identified them had stopped short of a finding that she was unable to perform her duties, instead finding that she could do so, "with adjustments".
• The Department was unable to demonstrate that a risk management plan had been prepared to address the Applicant's allergy/anaphylaxis risks. The Commissioner commented adversely on this failure by an organisation that was responsible for the safety of thousands of school children in New South Wales.
• The Department was further unable to demonstrate that it had explored other options, for example transfer to other suitable locations.

The Findings

The Commissioner found that several factors taken together led to the conclusion that the Applicant's dismissal had been "harsh, unreasonable or unjust". These were:

1. The Applicant was not given the opportunity to put her case on dismissal directly to the decision-maker before the decision to dismiss was made;
2. The absence of evidence from the decision-maker in turn meant that important issues raised in the letter of dismissal were unable to be tested;
3. The letter of dismissal displayed a "crucial factual error" when it concluded from the medical assessment report that she was unable to perform the inherent requirements of her position, when the health report had actually not drawn such a conclusion;
4. The prior action in directing the Applicant not to work was prejudicial to her (being an action normally only taken where a teacher is suspected of putting the safety of children at risk). Once that direction had been given (in circumstances where there was no justification for it), it operated to severely prejudice the Applicant in the continuing process of assessing whether she should be retired on medical grounds.

The Commissioner observed:

"Large organisations usually have structured hierarchies that devolve decision making to particular individuals. These decision makers will logically rely heavily on information and recommendations provided by others. However, if the decision maker determines something as serious as termination of employment without providing opportunity for face to face contact, he or she risks creating the appearance that they do not have the courage of their convictions. In addition, both the legal and ethical basis for the decision is open to manifest challenge."

Orders

The Department was ordered to reinstate the Applicant to her former position as soon as practicable and to remunerate the Applicant in respect to the intervening period between dismissal and reinstatement.

Implications

• The key factor in the case was the Department's failure to adduce cogent evidence on a number of issues, even though the Applicant was the moving party in the proceedings. Without bringing the relevant decision-maker to give evidence, the onus of proof was effectively reversed on to the employer.
• Industrial Relation tribunals will continue to expect large organisations to provide commensurate evidence of attempts to accommodate employees' medical needs and other restrictions.

Footnote

1 but for a three year period in the 1980s. Nothing turned on this.

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