Andrew Douglas: All right, our main topic today is around harshness and whether it can override a valid reason to terminate. And if I can give a bit of background, Tom, it’s very common that a piece of misconduct will be discovered. There’ll be discussions around it. Nothing much will happen. The complainant says, “No, no, no, please don’t proceed.” The complainant then falls out with the respondent six months, a year later and says, “No, I really want to proceed now.” And so an investigation is undertaken.

They find the conduct was wrong, and this results that the person’s terminated. They get to the Fair Work Commission. The Fair Work Commission goes, if it was really that serious, you should have terminated straight away. Now this is slightly different. So there’s a whole line of cases that show that you cannot sit on serious misconduct. If you say someone has committed serious misconduct, by condoning and allowing them to stay, you’re really saying it’s not serious. And therefore, to summary, dismiss them later will normally fail.

Tom Daly: Yeah.

Andrew Douglas: That might mean they aren’t, you can’t reinstate them ’cause the nature of the conduct breaches trust and confidence. So that’s one line of authority. But the Melbourne University professor case we’re going to talk about in a second is a second line of authority. And it’s quite a clever and interesting case because it talks about, well, if there is a delay between the conduct and the final determination, and in that period of time, it shows the person was of good character, there was no further problem. So it was just a once off, and they’ve actually rebuilt the trust in confidence. They’ve demonstrated that they are a good person, and there is a good explanation for why a particular behaviour occurred. Then harshness may be a defence for a dismissal.

Tom Daly: Yeah.

Andrew Douglas: maybe I’ll let you go with the facts of the case, Tom.

Tom Daly: So in this one, the professor in question sort of confided in one of his PhD students at a party, I think.

Andrew Douglas: Yeah, that’s right.

Tom Daly: That he’d just broken up with his partner and was struggling with that. And the two sort of slowly struck up, sort of like a relationship that went a little bit beyond. It was of a sexual nature, but yeah. Not sure how the, extent of it but.

Andrew Douglas: Well we don’t know, nobody sent photos. But what we do know in respect of it, it got to a stage where she was willing to undress on camera.

Tom Daly: Yeah.

Andrew Douglas: At one stage. He sent a picture of himself in his boxer shorts, talk about his body types.

Tom Daly: There’s a couple of no-nos.

Andrew Douglas: Yeah.

Tom Daly: Yeah.

Andrew Douglas: She sent a poem of love, you know, like it, there’s a lot of stuff which was.

Tom Daly: We can read out if you want.

Andrew Douglas: Which we won’t, but there’s a whole lot of warning signs and can I say in any relationship of trust. So where if Tom was working with me, then I need to be much more careful with the position of power that exists before us. At university, this is something that’s really clearly understood that the distance, the gap that must stay between a student and professional staff member.

Tom Daly: Yep.

Andrew Douglas: So he’s breached that, unquestionably breached it. And what he did.

Tom Daly: She’s put in an, she put in an informal complaint.

Andrew Douglas: Yep.

Tom Daly: But she didn’t say, she didn’t provide too much detail.

Andrew Douglas: Yep.

Tom Daly: And the university have sort of not really done anything.

Andrew Douglas: Well, she asked them not to do anything about it.

Tom Daly: Yeah, yeah, so it’s an example of the complainant saying, “Please don’t act.”

Andrew Douglas: I think she went and was supervised by somebody else afterwards.

Tom Daly: Yeah, and then, so that’s in 2017. Seven years later, 2024, she makes a formal complaint.

Andrew Douglas: Bitterness runs deep, doesn’t it, Tom?

Tom Daly: Yeah, yeah, I’d love to know why, what happened here in the interim.

Andrew Douglas: Well, they don’t have those sorts of side notes, do they?

Tom Daly: Yeah, yeah, Netflix docu maybe. And then the university has taken that to, as a reason to conduct a formal investigation. They’ve uncovered, uncovered the behaviour. I don’t know if they uncovered it then.

Andrew Douglas: Well they, he admitted it. He admitted to all the behaviour.

Tom Daly: Yeah.

Andrew Douglas: In detail. So they had a, and not only that, he produced copies of all the emails and everything they’ve done.

Tom Daly: Yeah, showing what was serious misconduct. But, and they’ve terminated him for that. But because it was seven years later and in the interim, he’d shown an unblemished record.

Andrew Douglas: Yeah.

Tom Daly: They said that he had sort of undone that, not undone that pattern but.

Andrew Douglas: Yeah, DP common said, looking back at it, this was a once off. He’d rebuilt the trust and confidence.

Tom Daly: Yeah, yeah.

Andrew Douglas: And therefore, he reinstated him.

Tom Daly: Yeah.

Andrew Douglas: So we’ve now got these two lines of authority, I guess, that I want you to run with. I think this is a great case, by the way.

Tom Daly: Yeah, I thought it was interesting.

Andrew Douglas: And I think that the reinstatement was the appropriate remedy as well. But what it shows is where time lapses and a person’s good behaviour comes to the fore. Any arguments about breach of trust and confidence fall away. So you’re going to get reinstatement. With the other liners we’ve talked about, sitting on your hands in relation to serious misconduct fails because you can no longer say it’s so serious, that there’s an imminent risk.

You know, what’s the imminent risk to someone’s health? The fundamental breach of the lawful and reasonable direction. But you’ve condoned it. All those things say that it’s no longer serious misconduct. So the lesson here really is if someone raises a complaint in respect to their own safety and they say, “Don’t do anything about it,” the answer is, “You do need to do something,” because it triggers your safety liability.

Tom Daly: So in this case, is there a certain amount of time or is it just enough time? So in this case, it was seven years had elapsed.

Andrew Douglas: Yeah.

Tom Daly: It’s not so much the number of years or the amount of time is enough time to rebuild the trust and confidence and to.

Andrew Douglas: Yeah, I think, I think that could have been two or three years, Tom. It’s not so much a time issue.

Tom Daly: Yeah.

Andrew Douglas: But the issue really here is that when the university was advised that there was an inappropriate relationship of a kind that caused a person concern, they can’t hide from it.

Tom Daly: Mm.

Andrew Douglas: They had to actually act. Their obligations under safety law are explicit that they must act under those circumstances and they failed to do so. And not argued here, not argued, would’ve been argued. Not argued here, but they’re in breach of their own safety obligations.

Tom Daly: Yep.

Andrew Douglas: They can’t then turn around and say, ah, well you’re still a bad person. Go.

Tom Daly: Yeah, yeah.

Andrew Douglas: By that stage, they failed to do the thing they were obliged to do.

Tom Daly: Mm.

Andrew Douglas: So great bit of case law.

Tom Daly: Yes.

Andrew Douglas: Why don’t we go on and have a look at the case study? I’ll just bring it up for you, Tom. So, and this, we do focus a bit on this case, but expanded to make it a little bit more complex.

Tom Daly: Yeah, so Evan was a curious character. He was an expert water resources engineer from Auckland. He was not an empath. He was hired by Deep Water Projects as the superintendent of a major artesian water project designed to bring fresh, palatable water to remote western Australian communities.

Andrew Douglas: Can I say that’s palatable? I wrote it wrong.

Tom Daly: Palatable?

Andrew Douglas: Palatable means drinkable. Yeah, sorry.

Tom Daly: I think palatable like tastes good.

Andrew Douglas: No, it tastes, it’s really good water. Palatable is can be drunk.

Tom Daly: Okay. Evan had to work with a, Evan had to work with a remote construction crew. They all lived in, you know, is it dongas?

Andrew Douglas: [Instructor] Dongas, yeah.

Tom Daly: I don’t know that word.

Andrew Douglas: [Instructor] I see you struggling with this .

Tom Daly: I could think of a few.

Andrew Douglas: [Instructor] Just stay on the chart.

Tom Daly: All lived in dongas and had a camp manager, cook, and cleaner. Alice was a junior engineer. Late one night, she and Evan were having a quiet beer around the campfire. She found him stiff, prickly, and indifferent. But she was not someone who took a backward step. She said to Evan, “How come you’re so stuck up?” He liked her directness. He told her he had left his wife behind in Auckland and she had since hooked up with another man. He said the pain was overwhelming. He wasn’t good at handling emotions, but emotionally, it felt like walking through a trip through treacle every day.

Alice grabbed his hand. He tried to pull back, but she told, but she held it tight. “You might be stuck up Evan, but you’re a good man,” she said. Evan left a little later. Alice followed him up. He was always thankful. At Friday night drinks a week later, Alice clung to him, clung to his arm, hugged him, and was clearly becoming infatuated with him. Evan knew there were strict rules around engaging with members of the opposite sex. He knew he was senior to her and needed to be careful. However, they were alone in the remote outback where drinking was common, and he was the most senior person present. Inevitably, they ended up in bed together. Inevitably . She had been very drunk.

Andrew Douglas: I wrote it. I’m a romantic. What can I say, Tom?

Tom Daly: She had been very drunk. The next morning, she was distressed by what had happened, and he was consumed by guilt over his wife. It was awkward. He distanced himself. They struggled to work together. She still liked him, but he became cold, isolated, and reluctant to engage with her. Her work began to suffer. She complained to HR but asked them not to take any action. HR spoke to Evan, who admitted he had breached the code of conduct. Two months later, Evan transferred to another site. Alice stayed behind. She continued messaging him, but his replies were curt and cautious. Six months later, her performance had deteriorated. She was being performance managed and said it was all Evan’s fault. She then formalised her complaint.

Andrew Douglas: All right, so the first question is, Evan knew that.

Tom Daly: Sex on site.

Andrew Douglas: Sex on site with a junior was forbidden under the code, for many reasons, including the remote nature of work and trust issues. He knew this, what he’d signed up for. What should Deep Water Projects have done?

Tom Daly: Yeah, well this, the thing that sticks out to me is Evan knew that there were strict rules around engaging with members of the opposite sex. He knew he was senior to her, but he did it anyway. So we’re looking at willful.

Andrew Douglas: Willful and deliberate conduct. So the issue is, even at this stage, the moment he admitted to that, they should have taken disciplinary action. Now, the disciplinary action may have had some controls around it. At the initial stage they might have said, “Look, it’s a final warning. She can no longer report to you. You may need to move to another site.” All those sort of things.

Tom Daly: So it doesn’t necessarily have to be?

Andrew Douglas: Not necessarily.

Tom Daly: Oh, we need to handle this. Let’s terminate him.

Andrew Douglas: Yeah, but you.

Tom Daly: Need to do something.

Andrew Douglas: Yeah, they were on notice. Damage had been done, breach had occurred. Evan committed no further wrongdoing after the one night encounter with Alice. If his employment was terminated after she’d made a formal complaint, would it be unfair? And if so, why? So this is, it’s not fair to throw this one at you, Tom. This is the two two strands. They knew that he’d done the breach. He admitted to the breach early on. They never investigated so.

Tom Daly: Similar to the previous case.

Andrew Douglas: Yeah, except they sort of knew much more this time.

Tom Daly: Right.

Andrew Douglas: They knew that he had admitted a breach of the code. They might not have known the particulars of it, but at that stage their obligation was to investigate and they didn’t. So they have effectively condoned it.

Tom Daly: Which is to say that it’s like it’s not serious misconduct.

Andrew Douglas: Yeah, so there’s no way they’d get up with a term, a summary termination.

Tom Daly: Right.

Andrew Douglas: It may, there’s absolutely no doubt their terminating may not be reinstated because they’d say there’s a breach of trust and confidence. Relatively short term, this stage. It’s only six months what the difference. But yes, the unfair dismissal claim would succeed without a doubt.

Tom Daly: Yep.

Andrew Douglas: Okay, so next.

Tom Daly: Was there anything wrong with Evan’s behaviour after the one night encounter? And if so, what would have been an appropriate intervention? So for me, this one is after the encounter, he’s become awkward and withdrawn and is.

Andrew Douglas: Yeah, he’s damaged. He’s created a number of psychological hazards.

Tom Daly: Around her.

Andrew Douglas: Yeah.

Tom Daly: By isolating her.

Andrew Douglas: That’s right.

Tom Daly: Yeah.

Andrew Douglas: Treating her differently.

Tom Daly: Yeah.

Andrew Douglas: So he really needed, he really needed to step up at this time and say to his boss, “This has happened. It’s not going well. I need your help and you need to give us some support.” And the boss might’ve said, “Well I’m sacking you Evan,” but that’s too bad.

Tom Daly: Yeah.

Andrew Douglas: Okay? Is it, I thought this was a bit of fun. ‘Cause in America they have things called love contracts. Okay, so in particularly in professional.

Tom Daly: Explain that, what is that?

Andrew Douglas: So in a professional services business, if you and your partner joined up or you form you’d, sorry, if you were in the firm and you formed into a romantic relationship with someone else, if you’d have to disclose the organisation.

Tom Daly: You would.

Andrew Douglas: Yeah, you’d have to.

Tom Daly: Yeah.

Andrew Douglas: And this is what’s called a love contract. Which means that A, you must disclose. And the reason for that is in professional services relationships, your goodwill, you know, if the relationship breaks up, what happens to the goodwill that is held by each person? So there are often rules which say you cannot form a relationship with people within this group of people. They’re called love contracts. So can you do that? Well as a matter of law, particularly, you can say where there is a compelling argument like living in a remote placeness, that you must not have relationships with people, that you’re there with.

Tom Daly: And is that because, ’cause I was reading this, trying to think of why that would be the case. And is that because of there’s only a few of them out there in this remote area, it’s important that they maintain rapport and support each other and?

Andrew Douglas: Yeah, because if you allow relationships to occur, the reporting cycle’s sort of shattered. So if there’s three of us in the room and Toya and I are in a partnership.

Tom Daly: And I’m feeling it right now.

Andrew Douglas: Yeah, yeah, you’re doing it right now. It means I’m going to treat her a lot better than you, partly ’cause I’m frightened. But it means that you get different types of treatment and there’s no escape from it ’cause you live in a tiny community.

Tom Daly: Yeah.

Andrew Douglas: So there is a good reason for it and it can be done. So I thought that’s an interesting part just to look at when people say, “Oh, you can’t tell people no.” Well part of the employment relationship, you can.

Tom Daly: Yep.

Andrew Douglas: All right guys, thanks very much. Give us some.

Tom Daly: It has to be reasonable.

Andrew Douglas: Yeah, it has to reasonable.

Tom Daly: Yeah.

Andrew Douglas: It can’t be unreasonable.

Tom Daly: You have to back it up.

Andrew Douglas: Yeah, yeah.

Tom Daly: Yeah.

Andrew Douglas: All right, there you go, guys. Next week, thanks very much. Thumbs up.

Tom Daly: No worries.

Andrew Douglas: Cheers.